INVESTMENT MANAGEMENT TRUST AGREEMENT

EXHIBIT 10.4

INVESTMENT MANAGEMENT TRUST AGREEMENT

This Agreement is made as of                     , 2005 by and between India Globalization Capital, Inc. (the “Company”) and Continental Stock Transfer & Trust Company (“Trustee”).

WHEREAS, the Company’s Registration Statement on Form S-1, No. 333-124942 (“Registration Statement”), for its initial public offering of securities (“IPO”) has been declared effective as of the date hereof by the Securities and Exchange Commission (“Effective Date”); and

WHEREAS, Ferris, Baker Watts, Incorporated (“FBW”) is acting as the representative of the underwriters in the IPO; and

WHEREAS, as described in the Company’s Registration Statement, $57,210,600 of the gross proceeds of the IPO and the Placement as herein provided as herein provided ($65,615,250 if the underwriters over-allotment option is exercised in full) (the “Base Deposit”) will be delivered to the Trustee to be deposited and held in a trust account for the benefit of the Company, FBW and the holders of the Company’s common stock, par value $.0001 per share, issued in the IPO (the amount to be delivered to the Trustee will be referred to herein as the “Property”; the stockholders for whose benefit the Trustee shall hold the Property will be referred to as the “Public Stockholders,” and the Public Stockholders, FBW and the Company will be referred to together as the “Beneficiaries”) and in the event the securities offered in the IPO are registered in Colorado, pursuant to Section 11-51-302(6) of the Colorado Revised Statutes (the “CRS”). A copy of Section 11-51-302(6) of the CRS is attached hereto and made a part hereof and

WHEREAS, a portion of the Property consists of $1,769,400 attributable to the underwriters’ non-accountable expenses allowance which FBW, on behalf of the underwriters, has agreed to deposit in the Trust Account (defined below); and

WHEREAS, the Company has agreed to issue securities in a private placement (the “Placement”); and

WHEREAS, the Company and the Trustee desire to enter into this Agreement to set forth the terms and conditions pursuant to which the Trustee shall hold the Property

IT IS AGREED:

1.        AGREEMENTS AND COVENANTS OF TRUSTEE. The Trustee hereby agrees and covenants to:

(a)      Hold the Property in trust for the Beneficiaries in accordance with the terms of this Agreement, including, without limitation, the terms of Section 11-51-302(6) of the CRS, in a segregated trust account (“Trust Account”) established by the Trustee at a branch of United Bank, Inc. selected by the Trustee;

(b)      Manage, supervise and administer the Trust Account subject to the terms and conditions set forth herein;

(c)      In a timely manner, upon the instruction of the Company, to invest and reinvest the Property in any “Government Security.” As used herein, Government Security means any Treasury Bill issued by the United States, having a maturity of one hundred and eighty days or less;

(d)      Collect and receive, when due, all principal and income arising from the Property, which shall become part of the “Property,” as such term is used herein;

(e)      Notify the Company and FBW of all communications received by it with respect to any Property requiring action by the Company;

(f)      Supply any necessary information or documents as may be requested by the Company in connection with the Company’s preparation of the tax returns for the Trust Account;

(g)      Participate in any plan or proceeding for protecting or enforcing any right or interest arising from the Property if, as and when instructed by the written instructions of the Company to do so;

(h)      Render to the Company and to FBW, and to such other person as the Company may instruct, monthly written statements of the activities of and amounts in the Trust Account reflecting all receipts and disbursements of the Trust Account;

(i)       As of the date of the consummation of a business combination (“Business Combination”), commence liquidation of the Trust Account upon receipt of the Officers’ Certificate signed by the Chief Executive Officer and Chief Financial Officer and in accordance with the terms of a letter (“Termination Letter”), in a form substantially similar to that attached hereto as Exhibit A signed on behalf of the Company by its President, Chief Financial Officer or Chairman of the Board and Secretary or Assistant Secretary. The Trustee shall complete the liquidation of the Trust Account and distribute the Property in the Trust Account to the Beneficiaries as directed in the Termination Letter and the other documents referred to therein. The Trustee understands and agrees that disbursements from the Trust Account shall be made only pursuant to a duly executed Termination Letter, together with the other documents referenced herein, including, without limitation, an independently certified oath and report of inspector of election in respect of the shareholder vote in favor of the Business Combination. In all cases, the Trustee shall provide FBW with a copy of any Termination Letters, Officers’ Certificates and/or any other correspondence that it receives with respect to any proposed withdrawal from the Trust Account promptly after it receives same.

(j)       As of the date 18 months from the date of this Agreement (the “LOI Termination Date”) (or 24 months from the date hereof in the event the Company has executed the Letter of Intent (defined below) prior to the LOI Termination Date but failed to consummate a Business Combination (“Second Termination Date”)), commence liquidation of the Trust Account. The Trustee, upon consultation with the Company and FBW, shall deliver a notice to Public Stockholders of record as of the LOI Termination Date or Second Termination Date, whichever the case may be, by U.S. mail or via the Depository Trust Company (“DTC”), within five days of the LOI Termination Date or Second Termination Date, to notify the Public Stockholders of such event and take such other actions as it may deem necessary to inform the Beneficiaries. The Trustee shall deliver to each Public Stockholder its ratable share of the Property against satisfactory evidence of delivery of the stock certificates by the Public Stockholders to the Company through DTC, its Deposit Withdraw Agent Commission (DWAC) system or as otherwise presented to the Trustee. Notwithstanding the foregoing, if the Trustee receives a bona fide, executed letter of intent or engagement letter (the “Letter of Intent”) for a Business Combination prior to the LOI Termination Date accompanied by an Officers’ Certificate as described in Section 2(e) hereof, then the Trustee shall forego or suspend any liquidation of the Trust Account until the earlier of a Business Combination or the Second Termination Date.

2.       LIMITED DISTRIBUTIONS OF INCOME ON PROPERTY.

(a)     Upon receipt by the Trustee of an Officer’s Certificate signed by the Chief Executive Officer and Chief Financial Officer of the Company certifying as true, accurate and complete a copy of any tax return required to be filed on behalf of the Trust Account in respect of income earned on the Property held therein, the Trustee shall deliver to the Company for submission to the appropriate taxing authority a check made payable to the order of such taxing authority in the amount required to pay such taxes; provided, however, that in no event shall the aggregate amount of all checks issued to taxing authorities pursuant to this Section 2(a) exceed the income in respect of which such taxes are due and owing.

(b)     Upon written request from the Company, which may be given not more than once in any calendar month, the Trustee shall distribute to the Company an amount equal to the income earned on the Base Deposit, net of taxes payable through the last day of the month immediately preceding the date of receipt of the Company’s request; provided, however, that the maximum amount of distributions, net of taxes, that the Company may request and the Trustee shall distribute pursuant to this Section 2(b) shall be $1,855,000.

(c)     Except as provided in Sections 2(a) and 2(b) above, no other distributions from the Trust Account shall be permitted except in accordance with Sections 1(i) and 1(j) hereof.

3.        AGREEMENTS AND COVENANTS OF THE COMPANY.

(a)      The Company hereby agrees and covenants to provide all instructions to the Trustee hereunder in writing, signed by the Company’s President or Chairman of the Board and Chief Financial Officer. In addition, except with respect to its duties under section 1(i) and (j) above, the Trustee shall be entitled to rely on, and shall be protected in relying on, any verbal or telephonic advice or instruction which it in good faith believes to be given by any one of the persons authorized above to give written instructions, provided that the Company and/or FBW, whichever has the authority to issue the instructions, shall promptly confirm such instructions in writing;

(b)      The Company hereby agrees and covenants to hold the Trustee harmless and indemnify the Trustee from and against, any and all expenses, including reasonable counsel fees and disbursements, or loss suffered by the Trustee in connection with any action, suit or other proceeding brought against the Trustee involving any claim, or in connection with any claim or demand which in any way arises out of or relates to this Agreement, the services of the Trustee hereunder, or the Property or any income earned from investment of the Property, except for expenses and losses resulting from the Trustee’s gross negligence or willful misconduct. Promptly after the receipt by the Trustee of notice of demand or claim or the commencement of any action, suit or proceeding, pursuant to which the Trustee intends to seek indemnification under this paragraph, it shall notify the Company in writing of such claim (hereinafter referred to as the “Indemnified Claim”). The Trustee shall have the right to conduct and manage the defense against such Indemnified Claim, provided, that the Trustee shall obtain the consent of the Company with respect to the selection of counsel, which consent

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shall not be unreasonably withheld. The Company may participate in such action with its own counsel;

(c)      Pay the Trustee an initial acceptance fee of $1,000 and an annual fee of $3,000 (it being expressly understood that the Property shall not be used to pay such fee). The Company shall pay the Trustee the initial acceptance fee and first year’s fee at the consummation of the IPO and thereafter on the anniversary of the Effective Date. The Trustee shall refund to the Company the fee (on a pro rata basis) with respect to any period after the liquidation of the Trust Fund. The Company shall not be responsible for any other fees or charges of the Trustee except as may be provided in section 2(b) hereof (it being expressly understood that the Property shall not be used to make any payments to the Trustee under such section);

(d)     In the event that the Company consummates a Business Combination and the Trust Account is liquidated in accordance with Section 1(i) hereof, the Trustee or another independent party designated by FBW shall act as the inspector of election to certify the results of the shareholder vote.

(e)     The Officers’ Certificate referenced in Sections 1(i) and (j) hereof shall require the Chief Executive Officer and Chief Financial Officer of the Company to each certify the following (wherever applicable): (1) prior to the LOI Termination Date, the Company has entered into a bona fide Letter of Intent with a target business; and/or (2) prior to the LOI Termination Date, the Company has entered into a Business Combination with a target business, the terms of which are consistent with the requirements set forth in the Registration Statement; and/or (3) prior to the Second Termination Date, the Company has entered into a Business Combination with a target business, the terms of which are consistent with the requirements set forth in the Registration Statement; and (4) the Board of Directors (the “Board”) pursuant to the unanimous written consent of the Board has approved (where applicable): (i) the Business Combination; and/or (ii) Letter of Intent. A copy of such consent shall be attached as an exhibit to the Officers’ Certificate.

3.        LIMITATIONS OF LIABILITY. The Trustee shall have no responsibility or liability to:

(a)      Take any action with respect to the Property, other than as directed in Section 1 hereof and the Trustee shall have no liability to any party except for liability arising out of its own gross negligence or willful misconduct;

(b)      Institute any proceeding for the collection of any principal and income arising from, or institute, appear in or defend any proceeding of any kind with respect to, any of the Property unless and until it shall have received written instructions from the Company given as provided herein to do so and the Company shall have advanced or guaranteed to it funds sufficient to pay any expenses incident thereto;

(c)      Change the investment of any Property, other than in compliance with Section 1(c) hereof;

(d)      Refund any depreciation in principal of any Property;

(e)      Assume that the authority of any person designated by the Company and FBW to give written instructions hereunder shall not be continuing unless provided otherwise in such designation, or unless the Company and FBW shall have delivered a written revocation of such authority to the Trustee;

(f)      The other parties hereto or to anyone else for any action taken or omitted by it, or any action suffered by it to be taken or omitted, in good faith and in the exercise of its own best judgment, except for its gross negligence or willful misconduct. The Trustee 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 Trustee), 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 Trustee, in good faith, to be genuine and to be signed or presented by the proper person or persons. The Trustee need not investigate any fact or matter stated in the document. The Trustee shall not be bound by any notice or demand, or any waiver, modification, termination or rescission of this agreement or any of the terms hereof, unless evidenced by a written instrument delivered to the Trustee signed by the proper party or parties and, if the duties or rights of the Trustee are affected, unless it shall give its prior written consent thereto;

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(g)      Verify the correctness of the information set forth in the Registration Statement or to confirm or assure that any acquisition made by the Company or any other action taken by it is as contemplated by the Registration Statement, unless an officer of the Trustee has actual knowledge thereof, written notice of such event is sent to the Trustee or as otherwise required under Section 1(i) hereof; and

(h)      Pay any taxes on behalf of the Trust Account (it being expressly understood that the Property shall not be used to pay any such taxes and that such taxes, if any, shall be paid by the Company from funds not held in the Trust Account).

5.        TERMINATION. This Agreement shall terminate as follows:

(a)      If the Trustee gives written notice to the Company that it desires to resign under this Agreement, the Company shall use its reasonable efforts to locate a successor trustee. At such time that the Company notifies the Trustee that a successor trustee has been appointed by the Company and has agreed to become subject to the terms of this Agreement, the Trustee shall transfer the management of the Trust Account to the successor trustee, including but not limited to the transfer of copies of the reports and statements relating to the Trust Account, whereupon this Agreement shall terminate; provided, however, that, in the event that the Company does not locate a successor trustee within ninety days of receipt of the resignation notice from the Trustee, the Trustee may submit an application to have the Property deposited with the United States District Court for the Southern District of New York and upon such deposit, the Trustee shall be immune from any liability whatsoever;

(b)      At such time that the Trustee has completed the liquidation of the Trust Account in accordance with the provisions of Section 1(i) hereof, and distributed the Property in accordance with the provisions of the Termination Letter, this Agreement shall terminate except with respect to Section 2(b) hereof; or

(c)      On such date after                     , 2007 when the Trustee deposits the Property with the United States District Court for the Southern District of New York in the event that, prior to such date, the Trustee has not received a Termination Letter from the Company pursuant to Sections 1(i) or (j) hereof.

6.        MISCELLANEOUS.

(a)      The Company and the Trustee each acknowledge that the Trustee will follow the security procedures set forth below with respect to funds transferred from the Trust Account. Upon receipt of written instructions, the Trustee will confirm such instructions with an Authorized Individual at an Authorized Telephone Number listed on the attached Exhibit C. The Company and the Trustee will each restrict access to confidential information relating to such security procedures to authorized persons. Each party must notify the other party immediately if it has reason to believe unauthorized persons may have obtained access to such information, or of any change in its authorized personnel. In executing funds transfers, the Trustee will rely upon account numbers or other identifying numbers of a beneficiary, beneficiary’s bank or intermediary bank, rather than names. The Trustee shall not be liable for any loss, liability or expense resulting from any error in an account number or other identifying number, provided it has accurately transmitted the numbers provided.

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(b)      This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving effect to conflict of laws. It may be executed in several counterparts, each one of which shall constitute an original, and together shall constitute but one instrument.

(c)      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 FBW. As to any claim, cross-claim or counterclaim in any way relating to this Agreement, each party waives the right to trial by jury.

(d)      The parties hereto consent to the jurisdiction and venue of any state or federal court located in the State of New York for purposes of resolving any disputes hereunder.

(e)      Any notice, consent or request to be given in connection with any of the terms or provisions of this Agreement shall be in writing and shall be sent by express mail or similar private courier service, by certified mail (return receipt requested), by hand delivery or by facsimile transmission:

if to the Trustee, to:

Continental Stock Transfer
& Trust Company
17 Battery Place
New York, New York 10004
Attn: Steven G. Nelson Fax No.: (212) 509-5150

if to the Company, to:

India Globalization Capital, Inc.
4336 Montgomery Avenue
Bethesda, Maryland 20814
Attn: Ram Mukunda, Chairman Fax No.: (240) 465-0273

in either case with a copy to:

Ferris, Baker Watts, Incorporated
100 Light Street
Baltimore, MD 21202
Attn: Scott T. Bass, Vice President Fax No.: (410) 659-4632

(f)      This Agreement may not be assigned by the Trustee without the prior consent of the Company.

(g)      Each of the Trustee and the Company hereby represents that it has the full right and power and has been duly authorized to enter into this Agreement and to perform its respective

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obligations as contemplated hereunder. The Trustee acknowledges and agrees that it shall not make any claims or proceed against the Trust Account, including by way of set-off, and shall not be entitled to any funds in the Trust Account und