Exhibit 10.3


 


 





STOCK ESCROW AGREEMENT


 


STOCK ESCROW AGREEMENT, dated as of ________,
2014 (“Agreement”), by and among HARMONY MERGER CORP., a Delaware corporation (“Company”), ERIC S. ROSENFELD,
DKU 2013, LLC, THE K2 PRINCIPAL FUND L.P., POLAR SECURITIES INC., DAVID D. SGRO, GREGORY MONAHAN, THOMAS KOBYLARZ, VICTOR BONILLA,
KYRILL ASATUR, JOEL GREENBLATT, JOHN P. SCHAUERMAN, ADAM SEMLER and LEONARD B. SCHLEMM (“Initial Stockholders”) and
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, a New York corporation (“Escrow Agent”).


 


WHEREAS, the Company has entered into an Underwriting
Agreement, dated as of ________, 2014 (“Underwriting Agreement”), with Cantor Fitzgerald & Co. (“Cantor Fitzgerald”)
acting as representative of the several underwriters (collectively, the “Underwriters”), pursuant to which, among other
matters, the Underwriters have agreed to purchase 10,000,000 units (“Units”) of the Company, plus an additional 1,500,000
Units if the Underwriters exercise their over-allotment option in full. Each Unit consists of one share of common stock of the
Company, par value $0.0001 per share (“Common Stock”), and one warrant to purchase three-fourths of
one share of Common Stock (as more fully described in the Company’s
final Prospectus, dated _________, 2014 (“Prospectus”), comprising part of the Company’s Registration Statement
on Form S-1 (File No. 333-197330) under the Securities Act of 1933, as amended (“Registration Statement”), declared
effective on _________, 2014 (“Effective Date”) and hereinafter referred to as a “Business Combination”).


 


WHEREAS, the Initial Stockholders have agreed
as a condition of the sale of the Units to deposit their shares of Common Stock 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 Stockholders
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 Stockholders 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 Stockholders shall deliver to the Escrow Agent certificates representing such Initial Stockholder’s
respective Escrow Shares, to be held and disbursed subject to the terms and conditions of this Agreement. Each of the Initial Stockholders
acknowledges that the certificate representing such Initial Stockholder’s Escrow Shares is legended to reflect the deposit
of such Escrow Shares under this Agreement.


 



    	



    	 



    




 


3.      Disbursement of the Escrow Shares.


 


3.1      The Escrow Agent shall hold the Escrow Shares during
the period (the “Escrow Period”) commencing on the date hereof and ending (i) for 50% of the Escrow Shares, on the
earlier of (x) one year after the date of the consummation of the Company’s initial Business Combination and (y) the date
on which the closing price of the Company’s Common Stock equals or exceeds $12.50 per share (as adjusted for stock splits,
stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after
the Company’s initial Business Combination and (ii) for the remaining 50% of the Escrow Shares, one year after the date of
the consummation of an initial Business Combination. The Company shall promptly provide notice of the consummation of a Business
Combination to the Escrow Agent. Upon completion of the Escrow Period, the Escrow Agent shall disburse such amount of each Initial
Stockholder’s Escrow Shares (and any applicable share power) to such Initial Stockholder; 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; provided further,
however, that if, within one year after the Company consummates a Business Combination, the Company (or the surviving entity) subsequently
consummates a liquidation, merger, stock exchange or other similar transaction which results in all of the stockholders of such
entity having the right to exchange their shares of Common Stock for cash, securities or other property, then the Escrow Agent
will, upon receipt of a notice executed by the Chairman of the Board, Chief Executive Officer or other authorized officer of the
Company, in form reasonably acceptable to the Escrow Agent, certifying that such transaction is then being consummated or such
conditions have been achieved, as applicable, release the Escrow Shares to the Initial Stockholders. The Escrow Agent shall have
no further duties hereunder after the disbursement or destruction of the Escrow Shares in accordance with this Section 3.


 


3.2      Notwithstanding Section 3.1, if the Underwriters do not
exercise their over-allotment option to purchase an additional 1,500,000 Units of the Company in full within 45 days of the date
of the Prospectus (as described in the Underwriting Agreement), the Initial Stockholders agree that the Escrow Agent shall return
to the Company for cancellation, at no cost, the number of Escrow Shares held by each such holder determined by multiplying (a)
the product of (i) 375,000, multiplied by (ii) a fraction, (x) the numerator of which is the number of Escrow Shares held by each
such holder, and (y) the denominator of which is the total number of Escrow Shares, by (b) a fraction, (i) the numerator of which
is 1,500,000 minus the number of shares of Common Stock purchased by the Underwriters upon the exercise of their over-allotment
option, and (ii) the denominator of which is 1,500,000. The Company shall promptly provide notice to the Escrow Agent of the expiration
or termination of the Underwriters’ over-allotment option and the number of Units, if any, purchased by the Underwriters
in connection with their exercise thereof.


 


4.      Rights of Initial Shareholders in Escrow Shares.


 


4.1      Voting Rights as a Stockholder. Subject to the
terms of the Insider Letters described in Section 4.4 hereof and except as herein provided, the Initial Stockholders 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 Stockholders, but all dividends payable in stock 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.


 



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4.3      Restrictions on Transfer. During the Escrow Period,
the only permitted transfers of the Escrow Shares will be (i) amongst the Initial Stockholders or to the Company’s officers,
directors and employees, (ii) by bona fide gift to a member of the Initial Stockholder’s immediate family or to a trust,
the beneficiary of which is the Initial Stockholder or a member of the Initial Stockholder’s immediate family for estate
planning purposes, (iii) by virtue of the laws of descent and distribution upon death of the Initial Stockholder, (iv) pursuant
to a qualified domestic relations order, (v) by certain pledges to secure obligations incurred in connection with purchases of
the Company’s securities, (vi) by private sales made at or prior to the consummation of a Business Combination at prices
no greater than the price at which the Escrow Shares were originally purchased or (vii) to the Company for cancellation in connection
with the consummation of a Business Combination, in each case, except for clause (vii), on the condition that such 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 (as defined below) signed by the Initial Stockholder transferring the Escrow Shares.


 


4.4       Insider Letters. Each of the Initial Stockholders
has executed a letter agreement with Cantor Fitzgerald and the Company, dated as indicated on Exhibit A hereto, and the form of
which is filed as an exhibit to the Registration Statement (“Insider Letter”), respecting the rights and obligations
of such Initial Stockholder 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.


 



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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 Stockholders 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.


 


5.8      Waiver. The Escrow Agent hereby waives any right
of set-off or any other right, title, interest or claim of any kind (“Claim”) in, or to any distribution of, the Trust
Account (as defined in that certain Investment Management Trust Agreement, dated as of the date hereof, by and between the Company
and the Escrow Agent as trustee thereunder) and hereby agrees not to seek recourse, reimbursement, payment or satisfaction for
any Claim against the Trust Account for any reason whatsoever.


 






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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, without giving effect to
conflicts of law principles that would result in the application of the substantive laws of another jurisdiction.


 


6.2      Third Party Beneficiaries. Each of the Initial
Stockholders 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 Cantor Fitzgerald.


 


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:


 


Harmony Merger Corp.


777 Third Avenue, 37th Floor


New York, New York 10017


Attn: Eric S. Rosenfeld, Chairman and
Chief Executive Officer


 


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


New York, New York 10004


Attn: Chairman


 


A copy of any notice sent hereunder shall be
sent to:


 


Cantor Fitzgerald & Co.


499 Park Avenue


New York, New York 10022


Attn: David Batalion


 



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and:


 


Graubard Miller


The Chrysler Building


405 Lexington Avenue


New York, New York 10174


Attn: David Alan Miller, Esq.


 


and:


 


Ellenoff Grossman & Schole LLP


1345 Avenue of the Americas


New York, New York 10105


Attn: Douglas S. Ellenoff, Esq.


 


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 the 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 specified in the Prospectus.


 


[Signature Page Follows]


 






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


 





	 	
        COMPANY:

         

        HARMONY MERGER CORP.

         

        

        By:                                                   

                Name:

                Title:

         

         

        INITIAL STOCKHOLDERS

         

                                                                   

        Eric S. Rosenfeld

        

         

        DKU 2013, LLC

         

        By:                                                   

               Name:

               Title:

         

         

        THE K2 PRINCIPAL FUND L.P.

         

        

        By:                                                   

               Name:

               Title:

         

         

        POLAR SECURITIES INC.

         

        

        By:                                                   

               Name:

               Title:

         

        

                                                                  

        

        David D. Sgro

        

         

        

        

                                                                  

        Gregory Monahan

         








 






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        Thomas Kobylarz

        

         

        

                                                                   

        Victor Bonilla

         

                                                                   

        

        Kyrill Asatur

         

                                                                  

        Joel Greenblatt

         

                                                                  

        John P. Schauerman

         

                                                                  

        Adam Semler

         

                                                                 

        Leonard B. Schlemm

         

         

        CONTINENTAL STOCK TRANSFER & TRUST COMPANY

         

        

        By:                                                    

               Name:

               Title:

         








 









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EXHIBIT A


 


	
        Name and Address of
        

        Initial Stockholder
        
	
        Number

        of
        Shares
	
        Stock
        

        Certificate
        Number
	
        Date
        of 

        Insider
        Letter