Form Share Escrow Agreement



 Exhibit 10.3 
  
 SHARE ESCROW AGREEMENT 
  
 SHARE ESCROW AGREEMENT, dated as of
                    , 2006 (“Agreement”), by and among SHANGHAI CENTURY ACQUISITION CORPORATION., a corporation organized under the
laws of the Cayman Islands (“Company”), FRANKLIN D. CHU, ANTHONY KAI YIU LO, RONALD JOSEPH ARCULLI, HUMPHREY P. POLANEN and RAYMOND CH’IEN (collectively “Initial Shareholders”) and Continental Stock Transfer & Trust
Company (“Escrow Agent”). 
  
 WHEREAS, the Company has
entered into an Underwriting Agreement, dated                     , 2006 (“Underwriting Agreement”), with I-Bankers Securities
Incorporated and [                    ] (collectively, the “Representatives”) acting as representatives of the several underwriters
(collectively, the “Underwriters”), pursuant to which, among other matters, the Underwriters will agree to purchase 12,500,000 units (“Units”) of the Company. Each Unit will consist of one ordinary share, $0.0005 par value, and
one Warrant, each Warrant to purchase one ordinary share, all as more fully described in the Company’s final Prospectus, dated
                    , 2006 (“Prospectus”) comprising part of the Company’s Registration Statement on Form F-1 (File No.
                    ) under the Securities Act of 1933, (together, the “Registration Statement”), which was declared effective on
                    , 2006 (“Effective Date”). 
  
 WHEREAS, the Initial Shareholders have agreed as a condition of the sale of the Units to deposit their ordinary shares of
the Company, as set forth opposite their respective names in Exhibit A attached hereto (collectively “Escrow Shares”), in escrow as hereinafter provided. 
  
 WHEREAS, the Company and the Initial Shareholders desire that the Escrow Agent accept the Escrow Shares, in escrow, to be
held and disbursed as hereinafter provided. 
  
 IT IS AGREED:

  
 1. Appointment of Escrow Agent. The Company and the Initial
Shareholders hereby appoint the Escrow Agent to act in accordance with and subject to the terms of this Agreement and the Escrow Agent hereby accepts such appointment and agrees to act in accordance with and subject to such terms. 
  
 2. Deposit of Escrow Shares. On or before the Effective Date, each of the
Initial Shareholders shall deliver to the Escrow Agent certificates representing his respective Escrow Shares, to be held and disbursed subject to the terms and conditions of this Agreement. Each Initial Shareholder acknowledges that the certificate
representing his Escrow Shares is legended to reflect the deposit of such Escrow Shares under this Agreement. 
  
 3. Disbursement of the Escrow Shares. The Escrow Agent shall hold the Escrow Shares until the third anniversary of the Effective Date (“Escrow
Period”), on which date it shall, upon written instructions from each Initial Shareholder, disburse each of the Initial Shareholder’s Escrow Shares to such Initial Shareholder; provided, however, that if the Escrow Agent is notified by the
Company pursuant to Section 6.7 hereof that the Company is being liquidated at 







 any time during the Escrow Period, then the Escrow Agent shall promptly destroy the certificates representing the Escrow
Shares and; provided further, that if, after the Company consummates a Business Combination (as such term is defined in the Registration Statement), (i) it (or the surviving entity) subsequently consummates a liquidation, stock exchange or other
similar transaction which results in all of the stockholders of such entity having the right to exchange their ordinary shares for cash, securities or other property, then the Escrow Agent will, upon receipt of a certificate, executed by the
Co-Chief Executive Officer or Chief Financial Officer of the Company, in form reasonably acceptable to the Escrow Agent, that such transaction is then being consummated, release the Escrow Shares to the Initial Shareholders upon consummation of the
transaction so that they can similarly participate or (ii) the Company redeems the Warrants and an aggregate of 12,500,000 ordinary shares have been traded on the American Stock Exchange (AMEX), the NASDAQ Stock Market (NASDAQ), the New York Stock
Exchange (NYSE) or the Electronic Over-the-Counter Bulletin Board (OTC-BB) at prices equal to or greater than $12.00 per share, then the Escrow Agent will, upon receipt of a certificate executed by a Co-Chief Executive Officer of the Company and
acknowledged by an officer of the Representatives, in form reasonably acceptable to the Escrow Agent, that such conditions have been satisfied, release twenty percent (20%) of the Escrow Shares to the Initial Shareholders. The Escrow Agent shall
have no further duties hereunder after the disbursement or destruction of the Escrow Shares in accordance with this Section 3. 
  
 4. Rights of Initial Shareholders in Escrow Shares. 
  
 4.1 Voting Rights as a Shareholder. Subject to the terms of the Insider Letter described in Section 4.4 hereof and except as
herein provided, the Initial Shareholders shall retain all of their rights as stockholders of the Company during the Escrow Period, including, without limitation, the right to vote such shares. 
  
 4.2 Dividends and Other Distributions in Respect of the
Escrow Shares. During the Escrow Period, all dividends payable in cash with respect to the Escrow Shares shall be paid to the Initial Shareholders, but all dividends payable in securities or other non-cash property (“Non-Cash
Dividends”) shall be delivered to the Escrow Agent to hold in accordance with the terms hereof. As used herein, the term “Escrow Shares” shall be deemed to include the Non-Cash Dividends distributed thereon, if any. 
  
 4.3 Restrictions on Transfer. During the Escrow
Period, no sale, transfer or other disposition may be made of any or all of the Escrow Shares except (i) by gift to a member of Initial Shareholder’s immediate family or to a trust, the beneficiary of which is an Initial Shareholder or a
member of an Initial Shareholder’s immediate family, (ii) by virtue of the laws of descent and distribution upon death of any Initial Shareholder, (iii) pursuant to a qualified domestic relations order, or (iv) pursuant to a
transfer of record ownership whereby there is no change in beneficial ownership; provided, however, that such permissive transfers may be implemented only upon the respective transferee’s written agreement to be bound by the terms and
conditions of this Agreement and of the Insider Letter signed by the Initial Shareholder transferring the Escrow Shares. During the Escrow Period, the Initial Shareholders shall not pledge or grant a security interest in the Escrow Shares or grant a
security interest in their rights under this Agreement. 
  
 4.4 Insider Letters. Each of the Initial Shareholders has executed a letter agreement with the Representatives and the Company, dated as indicated on Exhibit A hereto, and which is filed as an exhibit to the
Registration Statement (“Insider Letter”), respecting the rights and obligations of such Initial Shareholder in certain events, including but not limited to the liquidation of the Company. 







 5. Concerning the Escrow Agent. 
  
 5.1 Good Faith Reliance. The Escrow Agent shall not be liable for any action taken or omitted by it
in good faith and in the exercise of its own best judgment, and may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel (including counsel chosen by the Escrow Agent),
statement, instrument, report or other paper or document (not only as to its due execution and the validity and effectiveness of its provisions, but also as to the truth and acceptability of any information therein contained) which is believed by
the Escrow Agent to be genuine and to be signed or presented by the proper person or persons. The Escrow Agent shall not be bound by any notice or demand, or any waiver, modification, termination or rescission of this Agreement unless evidenced by a
writing delivered to the Escrow Agent signed by the proper party or parties and, if the duties or rights of the Escrow Agent are affected, unless it shall have given its prior written consent thereto. 
  
 5.2 Indemnification. The Escrow Agent shall be
indemnified and held harmless by the Company from and against any expenses, including counsel fees and disbursements, or loss suffered by the Escrow Agent in connection with any action, suit or other proceeding involving any claim which in any way,
directly or indirectly, arises out of or relates to this Agreement, the services of the Escrow Agent hereunder, or the Escrow Shares held by it hereunder, other than expenses or losses arising from the gross negligence or willful misconduct of the
Escrow Agent. Promptly after the receipt by the Escrow Agent of notice of any demand or claim or the commencement of any action, suit or proceeding, the Escrow Agent shall notify the other parties hereto in writing. In the event of the receipt of
such notice, the Escrow Agent, in its sole discretion, may commence an action in the nature of interpleader in an appropriate court to determine ownership or disposition of the Escrow Shares or it may deposit the Escrow Shares with the clerk of any
appropriate court or it may retain the Escrow Shares pending receipt of a final, non-appealable order of a court having jurisdiction over all of the parties hereto directing to whom and under what circumstances the Escrow Shares are to be disbursed
and delivered. The provisions of this Section 5.2 shall survive in the event the Escrow Agent resigns or is discharged pursuant to Sections 5.5 or 5.6 below. 
  
 5.3 Compensation. The Escrow Agent shall be entitled to reasonable compensation from the Company for
all services rendered by it hereunder. The Escrow Agent shall also be entitled to reimbursement from the Company for all expenses paid or incurred by it in the administration of its duties hereunder including, but not limited to, all counsel,
advisors’ and agents’ fees and disbursements and all taxes or other governmental charges. 
  
 5.4 Further Assurances. From time to time on and after the date hereof, the Company and the Initial Shareholders shall deliver or
cause to be delivered to the Escrow Agent such further documents and instruments and shall do or cause to be done such further acts as the Escrow Agent shall reasonably request to carry out more effectively the provisions and purposes of this
Agreement, to evidence compliance herewith or to assure itself that it is protected in acting hereunder. 







 5.5 Resignation. The Escrow Agent may resign at any time and be discharged from
its duties as escrow agent hereunder by its giving the other parties hereto written notice and such resignation shall become effective as hereinafter provided. Such resignation shall become effective at such time that the Escrow Agent shall turn
over to a successor escrow agent appointed by the Company, the Escrow Shares held hereunder. If no new escrow agent is so appointed within the 60 day period following the giving of such notice of resignation, the Escrow Agent may deposit the Escrow
Shares with any court it reasonably deems appropriate. 
  
 5.6 Discharge of Escrow Agent. The Escrow Agent shall resign and be discharged from its duties as escrow agent hereunder if so requested in writing at any time by the other parties hereto, jointly, provided, however, that such
resignation shall become effective only upon acceptance of appointment by a successor escrow agent as provided in Section 5.5. 
  
 5.7 Liability. Notwithstanding anything herein to the contrary, the Escrow Agent shall not be relieved from liability hereunder for
its own gross negligence or its own willful misconduct. 
  
 6.
Miscellaneous. 
  
 6.1 Governing Law. This
Agreement shall for all purposes be deemed to be made under and shall be construed in accordance with the laws of the State of New York. 
  
 6.2 Third Party Beneficiaries. Each of the Initial Shareholders hereby acknowledges that the Underwriters are third party
beneficiaries of this Agreement and this Agreement may not be modified or changed without the prior written consent of the Representatives. 
  
 6.3 Entire Agreement. This Agreement contains the entire agreement of the parties hereto with respect to the subject matter hereof
and, except as expressly provided herein, may not be changed or modified except by an instrument in writing signed by the party to the charged. 
  
 6.4 Headings. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning
or interpretation thereof. 
  
 6.5 Binding
Effect. This Agreement shall be binding upon and inure to the benefit of the respective parties hereto and their legal representatives, successors and assigns. 







 6.6 Notices. Any notice or other communication required or which may be given
hereunder shall be in writing and either be delivered personally or be mailed, certified or registered mail, or by private national courier service, return receipt requested, postage prepaid, and shall be deemed given when so delivered personally
or, if mailed, two days after the date of mailing, as follows: 
  
 If to the Company, to: 
  
 Shanghai Century Acquisition Corporation 
 Suite 1002, 10th Floor 
 43 Lyndhurst Terrace 
 Central, Hong Kong SAR, China 
 Attn: Franklin
D. Chu 
  
 If to a Stockholder, to his address
set forth in Exhibit A. 
  
 and if to the
Escrow Agent, to: 
  
 Continental Stock Transfer & Trust
Company 
 17 Battery Place, 8th Floor 
 New York, New York 10004 
 Attn: Steven G. Nelson, Chairman 
  
 The parties
may change the persons and addresses to which the notices or other communications are to be sent by giving written notice to any such change in the manner provided herein for giving notice. 
  
 6.7 Liquidation of Company. The Company shall give
the Escrow Agent written notification of the liquidation and dissolution of the Company in the event that the Company fails to consummate a Business Combination within the time period(s) specified in the Prospectus. 
  
 6.8 Amendment. This Agreement contains the entire
agreement and understanding of the parties hereto with respect to the subject matter hereof. This Agreement or any provision hereof may only be changed, amended or modified by a writing signed by each of the parties hereto; provided, however, that
no such change, amendment or modification may be made without the prior written consent of the Representative. As to any claim, cross-claim or counterclaim in any way relating to this Agreement, each party waives the right to trial by jury.

  
 6.9 Assignment. This Agreement may not
be assigned by the Escrow Agent without the prior consent of the Company. 







 WITNESS the execution of this Agreement as of the date first above written. 

 

			
	SHANGHAI CENTURY ACQUISITION
	CORPORATION
		
	By:	 	  


	 	 	Franklin D. Chu
	 	 	Co-Chief Executive Officer
	
	INITIAL SHAREHOLDERS:
		
	 	 	  


	 	 	Franklin D. Chu
		
	 	 	  


	 	 	Anthony Kai Yiu Lo
		
	 	 	  


	 	 	Ronald Joseph Arculli
		
	 	 	  


	 	 	Humphrey P. Polanen
		
	 	 	  


	 	 	Raymond Ch’ien
	
	CONTINENTAL STOCK TRANSFER & TRUST
	COMPANY
		
	By:	 	  


	Name:	 	Steven Nelson
	Title:	 	President









 EXHIBIT A 
  

					
	         Name and Address of Initial
Shareholders        

	  	Number of Shares

	  	Stock Certificate Number


	 Franklin D. Chu
 Suite 1002, 10th Floor
 Lyndhurst Terrac
 Central, Hong Kong SAR, China
	  	1
1,062,499
109,375	  	2
3
11
			
	 Anthony Kai Yiu Lo
 Suite 1002, 10th Floor, 43 Lyndhurst Terrace
 Central, Hong Kong SAR, China
	  	878,907
19,531	  	6
10
			
	 Ronald Joseph Arculli
 2012 Hutchison House
 Central, Hong Kong SAR, China
	  	625,000	  	7
			
	 Humphrey P. Polanen
 3000 Sand Hill Road
 Building 1, Suite 240
 Menlo Park, California 94025
	  	351,562	  	8
			
	 Raymond Ch’ien
 34th Floor, Citicorp Centre
 18 Whitfield Road
 North Point, Hong Kong
	  	78,125	  	9