|
EXHIBIT 10.3
EXECUTION VERSION
NOTE PURCHASE AGREEMENT
THIS NOTE PURCHASE AGREEMENT (the “ Agreement
”), effective as of December 24, 2007, is by and among INDIA
GLOBALIZATION CAPITAL, INC., a Maryland corporation (the “
Company
”), and each of the other parties who is a signatory hereto
(each a “ Lender
” and, collectively “ Lenders
”).
1.
The
Loan Transaction and Closing .
1.1
The Loans
. Subject to the terms and conditions of this Agreement,
Lenders agree to make a loan to the Company in the aggregate
principal amount of up to $7.275 million, to be governed by
the terms and conditions of, and repaid in accordance with the
Notes (as hereinafter defined). The parties hereto agree
and accept that there is no minimum principal amount of Notes
required to be sold hereunder in order to consummate any sale of
Notes hereunder.
1.2
The Notes and
Pledge Agreements
. A promissory note executed on the date hereof and
delivered to each Lender (each, a “ Note
” and, collectively the “ Notes
”) shall evidence the loan made by each Lender to the Company
pursuant to this Agreement in the amount indicated on Schedule
1 (each, a “ Loan
Amount ”). In order to secure repayment of
the Notes by the Company, the Company will enter into a Pledge
Agreement with the Lenders (the “ Pledge
Agreement ”).
1.3
The IGC Shares
.
(a) Subject to the terms and conditions of this Agreement, the
Company shall also issue, as additional consideration, shares of
common stock (the “ Common
Stock ”) of the Company to each Lender in such amounts
as are indicated on Schedule
2 attached hereto (collectively, such shares of Common Stock
are referred to as, the “ IGC
Shares ”), within 10 business days following the
consummation of a Business Combination (as defined in the Notes)
that is approved by the affirmative vote (the “ Yes
Vote ”) of the holders of a majority of the shares of
the Company’s Common Stock issued in its initial public
offering (the “ Public
Offering ”), provided that the holders of 20% or more
of the shares of Common Stock issued in the Public Offering do not
otherwise elect to exercise their conversion rights, as such rights
are further described in the Company’s final prospectus for
its Public Offering filed March 3, 2007. Regardless
of whether the Notes have been timely paid-in-full, the Lenders
shall be entitled to the issuance of the above shares of Common
Stock should the Company enter into a Business Combination within
one-year of the effective date of the Notes. In addition
to the foregoing, Ranga Krishna (“ Krishna
”) agrees to restrict the transfer of his IGC Shares in
accordance with the terms and conditions of the Lock-Up Letter (the
“ Lock-Up
Letter ”) for the period of time following the
consummation of a Business Combination as is set forth
therein.
(b) Between the date hereof and the Maturity Date (as defined in
each Note), the Company shall take all steps necessary to cause its
wholly owned subsidiary, India Globalization Capital, Mauritius,
Limited, a Mauritius Company (“ IGC-M
”), to abstain from issuing any shares of its capital stock
(and any other securities convertible into such common stock) to
any party other than the Company. If any such prohibited
issuance is made by IGC-M during such period, in addition to any
other rights or remedies available to Lenders under this Agreement,
the Pledge Agreement, or otherwise at law or in equity, each Lender
may at its option and by written notice delivered to the Company
within 10 days after such prohibited issuance, obtain payment in
full of all amounts then owed to such Lender under its respective
Note, which payment shall when made by the Company satisfy in full
the Company’s obligations thereunder to such
Lender.
(c) Each Lender acknowledges that if (i) the Business Combination
is not approved by the holders of a majority of the shares of the
Company’s Common Stock issued in the Public Offering, or (ii)
the Business Combination is validly approved by the shareholders,
but the holders of 20% or more of the shares of Common Stock issued
in the Public Offering elect to exercise their conversion rights,
or (iii) the date by which a Business Combination must be
consummated in accordance with the Company’s Amended and
Restated Articles of Incorporation passes without an extension of
such date, such Lender shall not be entitled to receive any IGC
Shares under this Agreement.
1.4
Registration Rights
. The Company will enter into a Letter Agreement with
Krishna (the “ Krishna
Letter Agreement ”) and with Oliveira (the “
Oliveira
Letter Agreement ” and, together with the Krishna
Letter Agreement, the “ Letter
Agreements ”), and a Registration Rights Agreement
with the remaining Lenders (the “ Registration
Rights Agreement ”), each on the date hereof, in order
to provide for registration with the Securities and Exchange
Commission (“ SEC
”) of the resale of the IGC Shares under the Securities Act
of 1933, as amended (the “ Securities
Act ”).
1.5
Closing
. The purchase and sale of the Notes (the “
Closing
”) will take place at the offices of Shulman, Rogers, Gandal,
Pordy & Ecker, P.A., 11921 Rockville Pike, Suite 300,
Rockville, Maryland, at such time as the parties shall mutually
agree. The Company may issue and sell additional
promissory notes and shares of Common Stock from time to time in
such amounts and to such persons as the Company may determine, in
one or more closings (each, a “ Subsequent
Closing ”) after the initial Closing (the “
Initial
Closing ”). The Initial Closing and each
Subsequent Closing are each referred to herein as a “
Closing
.” Any such issuance and sale shall be upon
substantially the same terms and conditions as those contained
herein. At each Subsequent Closing, (i) each
additional Lender shall execute and deliver a counterpart signature
page to this Agreement and the other agreements described in
Section 1.6, as applicable, and such additional Lender shall
become a “Lender” hereunder, and (ii) the Company
shall cause Schedule 1
and Schedule 2
attached hereto and Schedule 1
to the Pledge Agreement to be amended as appropriate to reflect the
loans made by each such additional Lender, the additional
IGC Shares to be issued to such Lender in accordance with the
terms hereof, and the pro-rata share of such Lender in and to the
collateral described in the Pledge Agreement.
1.6
Deliveries
. At the Closing:
(a) the Company will deliver (i) to each Lender, a Note
in the applicable Loan Amount and the Pledge Agreement; (ii) to
each Lender (other than Ranga Krishna (“ Krishna
”) and Oliveira Capital, LLC (“ Oliveira
”)), the Registration Rights Agreement; (iii) to Krishna, the
Krishna Letter Agreement; and (iv) to Oliveira, the Oliveira
Letter Agreement, each of which shall be duly executed by the
Company; and
(b) each Lender (i) will pay to the Company, by wire
transfer of immediately available funds, the applicable Loan
Amount; (ii) will deliver to the Company duly executed versions of
the applicable Note and the Pledge Agreement; and
(c) Krishna and Oliveira will deliver to the Company duly executed
versions of the Krishna Letter Agreement and Oliveira Letter
Agreement, respectively; and Krishna will deliver to the Company a
duly executed version of the Lock-Up Letter.
2.
Representations, Warranties and Covenants of the
Company
. The Company hereby represents and warrants to each
Lender as follows:
2.1
Organization, Standing and Power
. The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the State
of Maryland and has all requisite corporate power and authority to
carry on its business as contemplated to be conducted.
2.2
Authority and Enforceability
. The Company has all requisite corporate power and
authority to execute and deliver this Agreement, the Notes, the
Pledge Agreement, the Letter Agreements, and the Registration
Rights Agreement (collectively, the “ Loan
Agreements ”) and to perform fully its obligations
hereunder and thereunder. The execution and delivery of
this Agreement and such other Loan Agreeme
|
