|
EXHIBIT 10.5
FORM REGISTRATION RIGHTS AGREEMENT
THIS
REGISTRATION RIGHTS AGREEMENT (this "Agreement") is entered
into as of the ___ day of _____________ 200__, by and among:
India Globalization Capital, Inc., a Maryland corporation (the
"Company"); and the undersigned parties listed under Investors
on the signature pages hereto (each, an "Investor" and
collectively, the "Investors").
This
Agreement is made pursuant to the Note Purchase Agreement,
dated as of the date hereof, between the Company, each
Investor and certain other parties for the purchase of certain
promissory notes (the “Notes”) in the aggregate
principal amount specified therein and, under certain
conditions, shares of the Company’s Common Stock (the "
Purchase
Agreement ").
NOW,
THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as
follows:
1.
DEFINITIONS. The following capitalized terms used herein have
the following meanings:
"AGREEMENT"
means this Agreement, as amended, restated, supplemented, or
otherwise modified from time to time.
"COMMISSION"
means the Securities and Exchange Commission, or any other
federal agency then administering the Securities Act or the
Exchange Act.
"COMMON
STOCK" means the common stock, par value $0.0001 per share, of
the Company.
"COMPANY"
is defined in the preamble to this Agreement
"DEMAND
REGISTRATION" is defined in Section 2.1.1.
"DEMANDING
HOLDER" is defined in Section 2.1.1.
"EXCHANGE
ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission promulgated
thereunder, all as the same shall be in effect at the
time.
"FORM
S-3" is defined in Section 2.3.
"INDEMNIFIED
PARTY" is defined in Section 4.3.
"INDEMNIFYING
PARTY" is defined in Section 4.3.
"INVESTOR"
is defined in the preamble to this Agreement.
"INVESTOR
INDEMNIFIED PARTY" is defined in Section 4.1.
"MAXIMUM
NUMBER OF SHARES" is defined in Section 2.1.4.
"NOTICES"
is defined in Section 6.3.
"PIGGY-BACK
REGISTRATION' is defined in Section 2.2.1.
"REGISTER,"
"REGISTERED" and "REGISTRATION" mean a registration effected
by preparing and filing a registration statement or similar
document in compliance with the requirements of the Securities
Act, and the applicable rules and regulations promulgated
thereunder, and such registration statement becoming
effective.
“REGISTRABLE
SECURITIES” means (A) all shares of Common
Stock of the Company issuable pursuant to the Purchase
Agreement to the Investors that are party to this Agreement,
and (B) any securities issued or issuable upon any stock
split, dividend or other distribution, recapitalization or
similar event with respect to the foregoing,
provided
, that the Investor has completed and delivered to the Company
a Selling Shareholder Questionnaire attached hereto as
Exhibit A
; and provided,
further ,
that an Investor’s securities shall cease to be
Registrable Securities upon the earliest to occur of the
following: (A) a sale pursuant to a Registration Statement or
Rule 144 under the Securities Act (in which case, only such
security sold shall cease to be a Registrable Security); or
(B) such security becoming eligible for sale by the Investor
pursuant to Rule 144(k) under the Securities Act.
"REGISTRATION
STATEMENT" means a registration statement filed by the Company
with the Commission in compliance with the Securities Act and
the rules and regulations promulgated thereunder for a public
offering and sale of Common Stock (other than a registration
statement on Form S-4 or Form S-8, or their successors, or any
registration statement covering only securities proposed to be
issued in exchange for securities or assets of another entity
or for equity compensation plans, or a registration on any
registration form that does not permit secondary
sales.
"RELEASE
DATE" means the date on which shares of Common Stock are
issued by the Company pursuant to the Purchase
Agreement.
"SECURITIES
ACT" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated
thereunder, all as the same shall be in effect at the
time
"UNDERWRITER"
means a securities dealer who purchases any Registrable
Securities as principal in an underwritten offering and not as
part of such dealer's market-making activities.
2.
REGISTRATION RIGHTS.
2.1
DEMAND REGISTRATION.
2.1.1
REQUEST FOR REGISTRATION. At any time and from time to time on
or after the Release Date, the holders of a
majority-in-interest of the Registrable Securities held by the
Investors may make a written demand for
registration under the Securities Act of all of the
Registrable Securities then outstanding (a "DEMAND
REGISTRATION"). Any demand for a Demand Registration shall
specify the number of shares of Registrable Securities
proposed to be sold and the intended method(s) of distribution
thereof. The Company will notify all holders of Registrable
Securities of the demand, and each holder of Registrable
Securities who wishes to include all or a portion of such
holder's Registrable Securities in the Demand Registration
(each such holder including shares of Registrable Securities
in such registration, a "DEMANDING. HOLDER") shall so notify
the Company within fifteen (15) days after the receipt by the
holder of the notice from the Company. Upon any such request,
the Demanding Investors shall be entitled to have their
Registrable Securities included in the Demand Registration,
subject to Section 2.1.4 and the provisos set forth in Section
3.1.1. The Company shall not be obligated to effect more than
an aggregate of one (1) Demand Registration under this Section
2.1.1 in respect of Registrable Securities.
2.1.2
EFFECTIVE REGISTRATION. A registration will not count as a
Demand Registration until the Registration Statement filed
with the Commission with respect to such Demand Registration
has been declared effective and the Company has complied with
all of its obligations under this Agreement with respect
thereto; PROVIDED, HOWEVER, that if, after such Registration
Statement has been declared effective, the offering of
Registrable Securities pursuant to a Demand Registration is
interfered with by any stop order or injunction of the
Commission or any other governmental agency or court, the
Registration Statement with respect to such Demand
Registration will be deemed not to have been declared
effective, unless and until, (i) such stop order or injunction
is removed, rescinded or otherwise terminated, and (ii) a
majority-in-interest of the Demanding Investors thereafter
elect to continue the offering.
2.1.3
UNDERWRITTEN OFFERING. If a majority-in-interest of the
Demanding Investors so elect and such holders so advise the
Company as part of their written demand for a Demand
Registration, the offering of such Registrable Securities
pursuant to such Demand Registration shall be in the form of
an underwritten offering by an underwriter selected by the
Company and reasonably acceptable to the Demanding Investors.
In such event, the right of any holder to include its
Registrable Securities in such registration shall be
conditioned upon such holder's participation in such
underwriting and the inclusion of such holder's Registrable
Securities in the underwriting to the extent provided herein.
All Demanding Investors proposing to distribute their
securities through such underwriting shall enter into an
underwriting agreement in customary form with the Underwriter
or Underwriters selected for such underwriting by a
majority-ininterest of the holders initiating the Demand
Registration.
2.1.4
REDUCTION OF OFFERING. Subject to the rights of the
holders of securities issued or issuable upon exercise of
those certain Unit Purchase Options issued to Ferris, Baker
Watts, Inc. or its designees in connection with the Company's
initial public offering in 2005 and the holders of securities
that are subject to registration rights agreements entered
into prior to the date hereof, if the managing Underwriter or
Underwriters for a Demand Registration that is to be an
underwritten offering advises the Company and the Demanding
Investors in writing that the dollar amount or number of
shares of Registrable Securities which the Demanding Investors
desire to sell, taken together with all other shares of Common
Stock or other securities which the Company desires to sell
and the shares of Common Stock, if any, as to which
registration has been requested pursuant to written
contractual piggy-back registration rights held by other
shareholders of the Company who desire to sell, exceeds the
maximum dollar amount or maximum number of shares that can be
sold in such offering without adversely affecting the proposed
offering price, the timing, the distribution method, or the
probability of success of such offering (such maximum dollar
amount or maximum number of shares, as applicable, the
"MAXIMUM NUMBER OF SHARES"), then the Company shall include in
such registration: (i) first, the Registrable Securities as to
which Demand Registration has been requested by the Demanding
Investors (pro rata in accordance with the number of shares of
Registrable Securities which such Demanding Investor has
requested be included in such registration, regardless of the
number of shares of Registrable Securities held by each
Demanding Investor) that can be sold without exceeding the
Maximum Number of Shares; (ii) second, to the extent that the
Maximum Number of Shares has not been reached under the
foregoing clause (i), the shares of Common Stock or other
securities that the Company desires to sell that can be sold
without exceeding the Maximum Number of Shares; (iii) third,
to the extent that the Maximum Number of Shares has not been
reached under the foregoing clauses (i) and (ii), the shares
of Common Stock for the account of other persons that the
Company is obligated to register pursuant to written
contractual arrangements with such persons and that can be
sold without exceeding the Maximum Number of Shares; and (v)
fourth, to the extent that the Maximum Number of Shares have
not been reached under the foregoing clauses (i), (ii), and
(iii), the shares of Common Stock that other shareholders
desire to sell that can be sold without exceeding the Maximum
Number of Shares.
2.1.5
WITHDRAWAL. If a majority-in-interest of the Demanding
Investors disapprove of the terms of any underwriting or are
not entitled to include all of their Registrable Securities in
any offering, such majority-in-interest of the Demanding
Investors may elect to withdraw from such offering by giving
written notice to the Company and the Underwriter or
Underwriters of their request to withdraw prior to the
effectiveness of the Registration Statement filed with the
Commission with respect to such Demand Registration. If the
majority-in-interest of the Demanding Investors withdraws from
a proposed offering relating to a Demand Registration, then
such registration shall not count as a Demand Registration
provided for in Section 2.1.1.
2.1.6 The
Company shall not be required to effect a registration
pursuant to this Section 2.1:
(i)
during the period starting with the date that is 30 days prior
to the filing of, and ending on the date 180 days following
the effective date of, a Registration Statement pertaining to
a public offering, other than pursuant to a Registration
Statement relating to an employee benefit plan;
(ii)
if the Company shall furnish to the Demanding Investors a
certificate signed by the Chief Executive Officer of the
Company stating that in the good faith judgment of the
Company, it would be detrimental to the Company and its
stockholders for such registration statement to be effected at
such time, in which event the Company shall have the right to
defer such filing for a period of not more than 120 days
following receipt of the request for Demand
Registration;
(iii)
if the Company shall furnish to the Demanding Investors a
certificate signed by the Chief Executive Officer of the
Company that it intends to engage in a registered public
offering within 90 days following receipt of the request for
Demand Registration; or
(iv)
if the Demanding Investors propose to dispose of Registrable
Securities that may be immediately registered on Form S-3
pursuant to a request made pursuant to Section 2.5
below.
2.2
PIGGY-BACK REGISTRATION.
2.2.1
PIGGY-BACK RIGHTS. If at any time on or after the Release Date
the Company proposes to file a Registration Statement under
the Securities Act with respect to an offering of equity
securities, or securities or other obligations exercisable or
exchangeable for, or convertible into, equity securities, by
the Company for its own account or for shareholders of the
Company for their account (or by the Company and by
shareholders of the Company including, without limitation,
pursuant to Section 2.1), other than a Registration Statement
(i) filed in connection with any employee stock option or
other benefit plan, (ii) for an exchange offer or offering of
securities solely to the Company's existing shareholders,
(iii) for an offering of debt that is convertible into equity
securities of the Company or (iv) for a dividend reinvestment
plan, then the Company shall (x) give written notice of such
proposed filing to the holders of Registrable Securities as
soon as practicable but in no event less than ten (10) days
before the anticipated filing date, which notice shall
describe the amount and type of securities to be included in
such offering, the intended method(s) of distribution, and the
name of the proposed managing Underwriter or Underwriters, if
any, of the offering, and (y) offer to the holders of
Registrable Securities in such notice the opportunity to
register the sale of such number of shares of
Registrable
Securities as such holders may request in writing within five
calendar (5) days following receipt of such notice (a
"PIGGY-BACK REGISTRATION"). The Company shall cause such
Registrable Securities to be included in such registration and
shall use its commercially reasonable efforts to cause the
managing Underwriter or Underwriters of a proposed
underwritten offering to permit the Registrable Securities
requested to be included in a Piggy-Back Registration to be
included on the same terms and conditions as any similar
securities of the Company and to permit the sale or other
disposition of such Registrable Securities in accordance with
the intended method(s) of distribution thereof. All holders of
Registrable Securities proposing to distribute their
securities through a Piggy-Back Registration that involves an
Underwriter or Underwriters shall enter into an underwriting
agreement in customary form with the Underwriter or
Underwriters selected for such Piggy-Back
Registration.
2.2.2
REDUCTION OF OFFERING. Subject to the rights of the holders of
securities issued or issuable upon exercise of those certain
Unit Purchase Options issued to Ferris, Baker Watts, Inc. or
its designees in connection with the Company's initial public
offering in 2005 and the holders of securities that are
subject to registration rights agreements entered into prior
to the date hereof, if the managing Underwriter or
Underwriters for a Piggy-Back Registration that is to be an
underwritten offering advises the Company and the holders of
Registrable Securities in writing that the dollar amount or
number of shares of Common Stock which the Company desires to
sell, taken together with shares of Common Stock, if any, as
to which registration has been demanded pursuant to written
contractual arrangements with persons other than the holders
of Registrable Securities hereunder, the Registrable
Securities as to which registration has been requested under
this Section 2.2, and the shares of Common Stock, if any, as
to which registration has been requested pursuant to the
written contractual piggy-back registration rights of other
shareholders of the Company, exceeds the Maximum Number of
Shares, then the Company shall include in any such
registration:
(i)
If the registration is undertaken for the Company's account:
(A) first, the shares of Common Stock or other securities that
the Company desires to sell that can be sold without exceeding
the Maximum Number of Shares; (B) second, to the extent that
the Maximum Number of Shares has not been reached under the
foregoing clause (A), the shares of Common Stock, if any,
including the Registrable Securities, as to which registration
has been requested pursuant to written contractual piggy-back
registration rights of security holders (pro rata in
accordance with the number of shares of Common Stock which
each such person has actually requested to be included in such
registration, regardless of the number of shares of Common
Stock with respect to which such persons have the right to
request such inclusion) that can be sold without exceeding the
Maximum Number of Shares; and
(ii)
If the registration is a "demand" registration undertaken at
the demand of persons other than the holders of Registrable
Securities pursuant to written contractual arrangements with
such persons, (A) first, the shares of Common Stock for the
account of the demanding persons that can be sold without
exceeding the Maximum Number of Shares; (B) second, to the
extent that the Maximum Number of Shares has not been reached
under the foregoing clause (A), the shares of Common Stock or
other securities that the Company desires to sell that can be
sold without exceeding the Maximum Number of Shares; and (C)
third, to the extent that the Maximum Number of Shares has not
been reached under the foregoing clauses (A) and (B), the
Registrable Securities as to which registration has been
requested under this Section 2.2 (pro rata in accordance with
the number of shares of Registrable Securities held by each
such holder); and
(D)
fourth, to the extent that the Maximum Number of Shares has
not been reached under the foregoing clauses (A), (B) and (C),
the shares of Common Stock, if any, as to which registration
has been requested pursuant to written contractual piggy-back
registration rights which other shareholders desire to sell
that can be sold without exceeding the Maximum Number of
Shares.
2.2.3
WITHDRAWAL. Any holder of Registrable Securities may elect to
withdraw such holder's request for inclusion of Registrable
Securities in any Piggy-Back Registration by giving written
notice to the Company of such request to withdraw prior to the
effectiveness of the Registration Statement. The Company may
also elect to withdraw a registration statement at any time
prior to the effectiveness of the Registration
Statement.
2.3
REGISTRATIONS ON FORM S-3. The holders of Registrable
Securities may at any time and from time to time, request in
writing that the Company register the resale of any or all of
such Registrable Securities on Form S-3 or any similar
short-form registration which may be available at such time
("FORM S-3"); PROVIDED, HOWEVER, that the Company shall not be
obligated to effect such request through an underwritten
offering. Upon receipt of such written request, the Company
will promptly give written notice of the proposed registration
to all other holders of Registrable Securities, and, as soon
as practicable thereafter, effect the registration of all or
such portion of such holder's or holders' Registrable
Securities as are specified in such request, together with all
or such portion of the Registrable Securities of any other
holder or holders joining in such request as are specified in
a written request given within fifteen (15) days after receipt
of such written notice from the Company; PROVIDED, HOWEVER,
that the Company shall not be obligated to effect any such
registration pursuant to this Section 2.3: (i) if Form S-3 is
not available for such offering; or (ii) if the holders of the
Registrable Securities, together with the holders of any other
securities of the Company entitled to inclusion in such
registration, propose to sell Registrable Securities and such
other securities (if any) at any aggregate price to the public
of less than $1,000,000, (iii) if the Company shall furnish to
the initiating holder(s) of the Registrable Securities a
certificate signed by the Chief Executive Officer of the
Company that the Company intends to engage in a registered
public offering within 90 days following receipt of the Form
S-3 request or (iv) if the Company shall furnish to the
initiating holders(s) of the Registrable Securities a
certificate signed by the Chief Executive Officer of the
Company stating that in the good faith judgment of the
Company, it would be detrimental to the Company for such
Form S-3 registration to be effected at such time, in
which event the Company shall have the right to defer the
filing of the Form S-3 registration statement for a
period of not more than 120 days following receipt of the Form
S-3 Request or (v) if the Company has already effected a
registration on Form S-3 pursuant to this
Section 2.3.
2.3.1 Notwithstanding
the foregoing, the Company shall have the right, upon giving
written notice to the holders that have exercised such right,
to require each holder not to sell any Registrable Securities
pursuant to the Form S-3 for a reasonable period (as
determined in good faith by the Company) from the date on
which such notice is given (a " black-out
period "), if (i)(A) the Company is engaged in or
proposes to engage in discussions or negotiations with respect
to, or has proposed or taken a substantial step to commence,
or there otherwise is pending, any merger, acquisition, other
form of business combination, divestiture, tender offer,
financing or other transaction, or there is an event or state
of facts relating to the Company, in each case which is
material to the Company (any such negotiation, step, event or
state of facts being herein called a " Material
Activity "), (B) in the good faith judgment of the
Company, disclosure of such Material Activity would be
necessary under applicable securities laws, and (C) such
disclosure would, in the good faith judgment of the Company,
be adverse to the interests of the Company, or (ii) the
Company, in its good faith judgment, deems it necessary to
file a post-effective amendment to the Form S-3 Registration
Statement or to prepare a supplement to, or otherwise amend,
the form of prospectus contained therein. During
any such black-out period each Investor agrees not to sell any
Registrable Securities under the Form S-3 Registration
Statement for such period of time as the Company may in good
faith deem advisable.
3.
REGISTRATION PROCEDURES.
3.1
FILINGS; INFORMATION. Whenever the Company is required to
effect the registration of any Registrable Securities pursuant
to Section 2, the Company shall use its reasonably commercial
efforts
|
