INDIA GLOBALIZATION CAPITAL, INC. Note and Share Purchase Agreement Dated September 30, 2008
Exhibit
10.1
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Dated
September 30, 2008
TABLE OF
CONTENTS
| 1. The Loans, Notes and Shares. | ||
|
1.1
|
The
Loans
|
|
|
1.2
|
The
Notes
|
|
|
1.3
|
The
Shares
|
|
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1.4
|
Closings
|
|
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1.5
|
Delivery
|
|
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1.6
|
Issuance
of Additional Shares and Penalty Shares
|
|
| 2. Representations and Warranties of the Company | ||
|
2.1
|
Organization,
Standing and Power
|
|
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2.2
|
Authority
and Enforceability
|
|
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2.3
|
Valid
Issuance
|
|
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2.4
|
Accuracy
of Public Filings
|
|
|
2.5
|
Use
of Proceeds
|
|
|
2.6
|
No
Conflicts
|
|
|
2.7
|
Capitalization
|
|
|
2.8
|
Offering
|
|
|
2.9
|
Brokers
or Finders
|
|
|
2.10
|
Accuracy
of Information Furnished
|
|
| 3. Representations and Warranties of the Investor | ||
|
3.1
|
Authorization
|
|
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3.2
|
Purchase
Entirely for Own Account
|
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3.3
|
Disclosure
of Information
|
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|
3.4
|
Investment
Experience; Financial Risk
|
|
|
3.5
|
Accredited
Investor
|
|
|
3.6
|
Restricted
Securities
|
|
|
3.7
|
Legends
|
|
|
3.8
|
No
Conflicts
|
|
|
3.9
|
Relationship
Among Investors
|
|
|
3.10
|
Brokers
or Finders
|
|
| 4. Pari Passu with All Notes | ||
| 5. Conditions to Closing. | ||
|
5.1
|
Conditions
of Investor’s Obligations at Closing
|
|
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5.2
|
Conditions
to Obligations of the Company
|
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| 6. Covenants. | ||
|
6.1
|
Listing
of Shares
|
|
| 7. Miscellaneous. | ||
|
7.1
|
Waivers
and Amendments
|
|
|
7.2
|
Governing
Law
|
|
|
7.3
|
Survival
|
|
|
7.4
|
Successors
and Assigns
|
|
|
7.5
|
Entire
Agreement
|
|
|
7.6
|
Notices,
etc
|
|
|
7.7
|
Severability
of this Agreement
|
|
|
7.8
|
Counterparts
|
|
|
7.9
|
Expenses
|
|
Exhibit A - Form
of Unsecured Promissory Note
Exhibit B - Form
of Registration Rights Agreement
Exhibit C - Disclosure
Schedule
THIS NOTE
AND SHARE PURCHASE AGREEMENT (this “Agreement”) is effective as of September 30,
2008, by and between INDIA GLOBALIZATION CAPITAL, INC., a Maryland corporation
(the “Company”) and ____________ (the “Investor”).
1. The Loans, Notes and
Shares.
1.1 The
Loans. Subject to the terms and conditions of this Agreement,
the Investor agrees to make a loan (the “Loan”) to the Company in the principal
amount of ______ Dollars ($______,000.00) to be governed by the terms and
conditions of, and repaid in accordance with, this Agreement.
1.2 The
Notes. The Loan made by the Investor pursuant hereto shall be
evidenced by an unsecured promissory note of the Company executed concurrently
herewith in the form attached hereto as Exhibit A (the
“Note” and together with each other Note issued pursuant to and in connection
with the terms hereof, the “Notes”).
1.3 The
Shares. Subject to the terms of this Agreement and in
consideration of the Loan, the Company shall issue and sell to the Investor One
Hundred Thousand (100,000) shares of the Common Stock of the Company (the
“Shares”) for every One Million Dollars ($1,000,000) of the Loan made by the
Investor. The Company will also enter into a Registration Rights
Agreement in substantially the form attached hereto as Exhibit B (the
“Registration Rights Agreement”) providing for registration rights for the
Shares, the Additional Shares and the Penalty Shares (each as defined below)
(together, the “Total Shares”).
1.4 Closings. The
closing of the purchase and sale of the Notes and the Shares (each such closing,
a “Closing”) will take place at the offices of Seyfarth Xxxx LLP, 000
Xxxxxxxxxxx Xxxxxx, X.X., Xxxxx 000, Xxxxxxxxxx, X.X. at such time as the
parties shall mutually agree. Upon the receipt from investors and
acceptance by the Company of Loans totaling at least Two Million Dollars
($2,000,000.00) in the aggregate principal amount, the Company may close the
initial purchase and sale of the Notes and Shares (the “Initial
Closing”). Following the Initial Closing, and from time-to-time
thereafter until October 31, 2008, the Company may sell to such persons as the
Company may determine additional Notes, each with a principal amount of at least
$100,000 or any multiple thereof, and hold additional Closings with respect
thereto (each, a “Subsequent Closing”). Any such sale shall be upon
the same terms and conditions as those contained herein, and such persons or
entities shall become parties to an agreement identical in form and substance to
this Agreement and shall have the rights and obligations of an Investor
thereunder (all such investors together, the “Investors”). At the
Initial Closing and each Subsequent Closing, the Company will deliver to each
Investor the respective Note and Shares purchased by such Investor, against
receipt by the Company of the respective principal amount of the Note purchased
by such Investor. The Company shall have the right to reject any
investment, in whole or in part, for any reason whatsoever notwithstanding the
Company’s prior execution hereof, and any funds received for an investment so
rejected shall be returned immediately to the appropriate
Investor. The obligations of the Investors under the Notes are
several and not joint.
1.5 Delivery. At
the Closing, the Company will deliver to the Investor (i) the Note representing
the Loan made by the Investor and (ii) the certificate(s) representing the
Shares issued to the Investor as set forth in Section 1.3.
1.6 Issuance of Additional
Shares and Penalty Shares.
(a) Upon the
occurrence of an Event of Default under the Note as defined and provided
therein, provided such Event of Default is not cured within thirty (30) days,
the Company shall issue and sell to the Investor, for no additional
consideration, an additional Ten Thousand (10,000) shares of the Common Stock of
the Company for each One Hundred Thousand Dollars ($100,000) in principal amount
of the Note held by such Investor (the “Additional Shares”).
(b) If the
Company fails to file a Registration Statement on or prior to the applicable
Filing Date, or if the Effective Date of a Registration Statement is not on or
prior to the applicable Effectiveness Date (as each of those terms is defined in
the Registration Rights Agreement), the Company shall issue and sell to each of
the Investors, upon the terms and conditions set forth in the Registration
Rights Agreement and for no additional consideration, an additional Twenty-Five
Thousand (25,000) shares of the Common Stock of the Company for each One Million
Dollars ($1,000,000) in principal of the Note held by such Investor and, if the
Effective Date is more than 30 days after such applicable Effectiveness Date, an
additional Five Thousand (5,000) shares of the Common Stock of the Company for
each One Million Dollars ($1,000,000) in principal of the Note held by such
Investor and for each subsequent 30-day period that such Registration Statement
is not declared effective (the “Penalty Shares”).
2. Representations and
Warranties of the Company. Except as disclosed in the
Disclosure Schedule attached hereto as Exhibit C, the
Company hereby represents and warrants to the Investor 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 own, lease and operate its
properties and to carry on its business as contemplated to be
conducted. The Company is duly qualified and authorized to transact
business in each jurisdiction in which the failure to so qualify would have a
material adverse effect on its business, assets, liabilities, financial
condition, property or results of operation.
2.2 Authority and
Enforceability. The Company has all requisite corporate power
and authority to execute and deliver this Agreement, the Notes and the
Registration Rights Agreement (together, the “Transaction Documents”) and to
perform fully its obligations thereunder. The execution and delivery
of the Transaction Documents and the consummation of the transactions
contemplated thereby have been duly authorized by all necessary corporate action
on the part of the Company, its officers, directors and
stockholders. Each of the Transaction Documents has been duly
executed and delivered by the Company and, assuming that each of the Transaction
Documents constitutes a valid and binding agreement of the other parties hereto,
each such Transaction Document constitutes a legal, valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to creditors’ rights and
remedies generally and subject, as to enforceability, to general principles of
equity, regardless of whether enforceability is considered in a proceeding at
law or in equity.
2.3 Valid
Issuance. The Shares and the Additional Shares and Penalty
Shares, if and when issued and delivered in accordance with the terms of this
Agreement or the Registration Rights Agreement for the consideration expressed
herein or therein, as the case may be, will be duly and validly issued, fully
paid, and non-assessable and will be free of restrictions on transfer other than
restrictions on transfer under applicable state and federal securities
laws.
2.4 Accuracy of Public
Filings. The representations, warranties and other statements
of the Company contained in the documents (the “SEC Documents”) filed with the
Securities and Exchange Commission (“SEC”) under the Securities Exchange Act of
1934, as amended (the “Exchange Act”), taken as a whole, do not contain any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements contained therein not misleading as of the
respective dates of such filings. The Company has timely filed all
reports, schedules, forms, statements and other documents required to be filed
by it with the SEC pursuant to the reporting requirements of the Exchange Act,
including material filed pursuant to Section 13(a) or 15(d) of the Exchange
Act. Since the date that the Company filed its last Form 10-Q with
the SEC, there has been no material adverse change in the assets, business, or
financial condition of the Company.
2.5 Use of
Proceeds. All of the proceeds of the Loans will be used for
working capital and general corporate purposes.
2.6 No
Conflicts. The execution, delivery and performance of the
Transaction Documents, and any other document or instrument contemplated
thereby, by the Company and the consummation by the Company of the transactions
contemplated thereby do not and will not: (i) contravene, conflict with, or
result in the violation of any provision of the Company’s charter or bylaws or
any resolution adopted by the Company’s board of directors, (ii) conflict with,
or constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give rise to any rights of termination,
amendment, acceleration or cancellation of, any material agreement, mortgage,
deed of trust, indenture, note, bond, license, lease agreement, instrument or
obligation to which the Company or any of its subsidiaries is a party, (iii)
create or impose a lien, charge or encumbrance on any property of the Company or
any of its subsidiaries under any agreement or any commitment to which the
Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or by which any of its respective properties or assets
are bound, (iv) result in a material violation of any federal, state, local or
foreign statute, rule, regulation, order, writ, judgment or decree (including
federal and state securities laws and regulations) applicable to the Company or
any of its subsidiaries or by which any property or asset of the Company or any
of its subsidiaries are bound or affected or result in a violation of any rules
or regulations of the American Stock Exchange (“AMEX”) applicable to the Company
or, if the Company’s shares of Common Stock are no longer listed on AMEX, such
other stock exchange on which shares of the Company’s Common Stock are
principally traded and approved for listing at such time, or (v) require any
consent of any third-party that has not been obtained pursuant to any material
contract to which the Company or any of its subsidiaries is subject or to which
any of its respective assets, operations or management may be
subject. The Company or any of its subsidiaries is not required under
federal, state or local law, rule or regulation to obtain any consent,
authorization or order of, or make any filing or registration with, any court or
governmental agency in order for it to execute, deliver or perform any of its
obligations under the Transaction Documents, or issue and sell the Notes or the
Total Shares (other than any filings that may be required to be made by the
Company with the SEC or state securities commissions subsequent to the
Closing).
2.7 Capitalization. The
authorized capital stock of the Company immediately prior to the Initial Closing
consists of 75,000,000 shares of Common Stock, par value $0.0001 per share, of
which Eight Million Five Hundred Eighty Thousand One Hundred Seven (8,580,107)
shares are issued and outstanding. All of the issued and outstanding
shares of Common Stock have been duly authorized and validly issued and are
fully paid and nonassessable. Except as provided in this Agreement or
disclosed in the SEC Documents, (a) no subscription, warrant, option,
convertible security or other right (contingent or otherwise) to purchase or
acquire any shares of capital stock of the Company (including, without
limitation, anti-dilution rights, rights of first refusal or preemptive rights)
is authorized or outstanding; (b) the Company has no obligation (contingent or
otherwise) to issue any subscription, warranty, option, convertible security or
other such right or to issue or distribute to holders of any shares of its
capital stock any evidences of indebtedness or assets of the Company; and (c)
the Company has no obligation (contingent or otherwise) to purchase, redeem or
otherwise acquire any shares of its capital stock or any interest therein or to
pay any dividend or make any other distribution in respect
thereof. All of the issued and outstanding shares of capital stock of
the Company have been offered, issued and sold by the Company in compliance with
applicable federal and state securities laws or pursuant to valid exemptions
therefrom.
2.8 Offering. Subject
in part to the truth and accuracy of the Investor’s representations and
warranties set forth in Section 3 of this Agreement, the offer, sale and
issuance of the Shares, the Additional Shares and the Penalty Shares as
contemplated by this Agreement are exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended (the “Securities Act”), and
neither the Company nor any authorized agent acting on its behalf will take any
action hereafter that would cause the loss of such exemption.
2.9 Brokers or
Finders. The Company has not and will not incur, directly or
indirectly, any liability for brokerage or finders’ fees or agents’ commissions
or any similar charges in connection with the execution and delivery of this
Agreement.
2.10 Accuracy of Information
Furnished. The representations, warranties and other
statements of the Company set forth in Section 2 of this Agreement,
Section 6(b) of the Registration Rights Agreement, the Disclosure Schedule
and Schedule 6(b) attached to the Registration Rights Agreement, taken as a
whole, do not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements contained therein, in light of
the circumstances under which they were made, not misleading.
3. Representations and
Warranties of the Investor. The Investor hereby represents and
warrants only with respect to himself, herself or itself that:
3.1 Authorization. Investor
has full power and authority to enter into this Agreement and the Note
(collectively, the “Loan Agreements”), and that the Loan Agreements constitute
valid and legally binding obligations of such Investor, enforceable in
accordance with their respective terms. The Loan Agreements
have been duly executed and delivered by the Investor and, assuming the Loan
Agreements constitute valid and binding agreements of the other parties thereto,
the Loan Agreements constitute legal, valid and binding obligations of the
Investor, enforceable against the Investor in accordance with their respective
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors’ rights
and remedies generally and subject, as to enforceability, to general principles
of equity, regardless of whether enforceability is considered in a proceeding at
law or in equity.
3.2 Purchase Entirely for Own
Account. The Notes, the Shares, the Additional Shares and the
Penalty Shares (collectively, the “Securities”) will be acquired for investment
for Investor’s own account, not as a nominee or agent, and not with a view to
the resale or distribution of any part thereof, and the Investor has no present
intention of selling, granting any participation in, or otherwise distributing
the same. The Investor does not have any contract, undertaking,
agreement or arrangement with any person to sell, transfer or grant
participation in any of the Securities to such person or to any third
person.
3.3 Disclosure of
Information. The Investor has had an opportunity to ask
questions and receive answers from the Company regarding the terms and
conditions of the offering and sale of the Securities.
3.4 Investment Experience;
Financial Risk. The Investor is an investor in securities of
companies in the development stage and acknowledges that it has (i) such
knowledge and experience in financial and business matters that the Investor is
capable of evaluating the merits and risks of the investment in the Securities,
(ii) had such risks explained to it and has determined that such investment is
suitable for the Investor in view of its financial circumstances and available
investment opportunities, (iii) sufficient net worth and income to bear the
economic risk of this investment, and (iv) no need for liquidity of the
investment and no reason to anticipate any change in the Investor’s financial
circumstances which may cause or require any sale, transfer or other
distribution of the Securities The Investor has not been organized
for the purpose of acquiring the Securities.
3.5 Accredited
Investor. The Investor is an “accredited investor” within the
meaning of the Securities and Exchange Rule 501(a) of Regulation D, as presently
in effect.
3.6 Restricted
Securities. The Investor understands that the Securities it is
purchasing are characterized as “restricted securities” under the federal
securities laws inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that, under such laws and
applicable regulations, such securities may be resold without registration under
the Securities Act only in certain limited circumstances. In this
connection, the Investor is familiar with Rule 144, as presently in effect, and
understands the resale limitations imposed thereby and by the Securities
Act. The Investor understands that reliance by the Company on such
exemptions is predicated in part on the Investor’s representations contained in
this Agreement.
3.7 Legends. The
Investor understands and agree that the certificates evidencing the Securities
may bear one or all of the following legends:
(a) “THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND
NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF, AND
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE SOLD, TRANSFERRED OR ASSIGNED UNLESS COVERED BY AN EFFECTIVE
REGISTRATION STATEMENT UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY TO
THE ISSUER TO THE EFFECT THAT ANY SUCH TRANSFER IS EXEMPT FROM SUCH
REGISTRATION.”
(b) Any
additional legend required by the laws of the State of Maryland or any other
applicable state.
3.8 No
Conflicts. Neither the execution and delivery of this
Agreement nor the consummation or performance of any of the transactions
contemplated hereby will, directly or indirectly (with or without notice or
lapse of time) contravene, conflict with, or result in a violation of, or give
any governmental body the right to challenge any of the transactions
contemplated hereby or to exercise any remedy or obtain any relief under, any
legal requirement or order to which the Investor may be subject.
3.9 Relationship Among
Investors. Each Investor agrees that no Investor nor the
controlling persons, officers, directors, partners, agents or employees of an
Investor shall be liable to any other Investor for any action heretofore or
hereafter taken or omitted to be taken by any of them in connection with the
purchase of the Notes, the Shares, the Additional Shares and the Penalty
Shares. Without limiting the foregoing, no Investor nor any of its
officers, directors, stockholders, partners, employees or agents or affiliates,
or other holder of any Note shall have any obligation, liability or
responsibility whatsoever for the accuracy, completeness or fairness of any or
all information about the Company or any subsidiary or their respective
properties, business or financial and other affairs, acquired by such Investor
or holder from the Company or any subsidiary or the respective officers,
directors, employees, agents, representatives, counsel or auditors of either,
and in turn provided to another Investor or holder of any Note, nor shall any
such Investor or other person or entity have any obligation or responsibility
whatsoever to provide any such information to any other Investor or holder of
any Note or to continue to provide any such information if any information is
provided.
3.10 Brokers or
Finders. The Investor has not and will not incur, directly or
indirectly, any liability for brokerage or finders’ fees or agents’ commissions
or any similar charges in connection with the execution and delivery of this
Agreement.
4. Pari Passu with All
Notes. Each Note shall rank equally without preference or
priority of any kind with each of the Notes issued by the Company to the
Investors hereunder. All payments on account of principal and
interest with respect to the Notes shall be applied ratably and proportionately
on each such Note on the basis of the original principal amount of outstanding
indebtedness represented by such Note.
5. Conditions to
Closing.
5.1 Conditions of Investor’s
Obligations at Closing. The obligations of the Investor at the
Closing are subject to the fulfillment, on or prior to the date of Closing, of
each of the following conditions, any of which may be waived in whole or in part
by the Investors:
(a) The
representations and warranties made by the Company in Section 2 shall be true and correct when made, and shall be
true and correct on the date of Closing with the same force and effect as if
they had been made on and as of the same date.
(b) The
Company shall have performed and complied with all agreements, obligations and
conditions contained in this Agreement that are required to be performed or
complied with by it on or prior to the date of Closing.
(c) Except
for the notices required or permitted to be filed after the date of Closing
pursuant to applicable federal and state securities laws, the Company shall have
obtained all governmental approvals required in connection with the lawful sale
and issuance of the Notes and the Shares.
(d) The
Company shall have delivered to the Investor a certificate duly executed by the
chief executive officer of the Company stating that the Company is in compliance
with the conditions specified in Section 5.1(a)-(c) hereof.
(e) At the
Closing, the sale and issuance by the Company, and the purchase by the Investor,
of the Note, the Shares, the Additional Shares and the Penalty Shares shall be
legally permitted by all laws and regulations to which such Investor and/or the
Company are subject.
(f) At the
Closing, the Company shall duly execute and deliver to the Investor the
Transaction Documents, including such Investor’s Note, and shall have delivered
to its transfer agent irrevocable instructions to issue to the Investor the
Shares to be issued to such Investor hereunder.
(g) The
Company shall have delivered a legal opinion by its counsel that (i) the Shares,
Additional Shares and the Penalty Shares are duly authorized and when issued
will be validly issued, fully paid and non-assessable; (ii) the Transaction
Documents have been duly authorized, executed and delivered, each of which is
enforceable in accordance with its terms; and (iii) the transactions
contemplated by the Transaction Documents do not violate applicable laws, any
material agreements of the Company or its subsidiaries, or the rules and
regulations of AMEX.
5.2 Conditions to Obligations of
the Company. The Company’s obligation to issue and sell the
Notes and the Shares at the Closing is subject to the fulfillment, to the
Company’s satisfaction, on or prior to the date of Closing, of the following
conditions, any of which may be waived in whole or in part by the
Company:
(a) The
representations and warranties made by the Investor in Section 3 shall be
true and correct when made, and shall be true and correct on the date of Closing
with the same force and effect as if they had been made on and as of the same
date.
(b) Except
for any notices required or permitted to be filed after the date of Closing
pursuant to applicable federal or state securities laws, the Company shall have
obtained all governmental approvals required in connection with the lawful sale
and issuance of the Securities.
(c) At the
Closing, the sale and issuance by the Company, and the purchase by the Investor,
of the Note and the Shares, the Additional Shares and the Penalty Shares shall
be legally permitted by all laws and regulations to which such Investor and/or
the Company are subject.
(d) At the
Closing, the Company shall have received immediately available funds in the full
amount of the principal amount of the Note in accordance with the wire transfer
instructions delivered by the Company to the Investor prior to the
Closing.
6. Covenants.
6.1 Listing of
Shares. The Company will use reasonable best efforts to ensure
that, no later than the effective date of any registration statement pertaining
thereto, the Shares and any Additional Shares and/or Penalty Shares that have
been issued, have been duly authorized for listing on AMEX or, if no longer
listed on AMEX, such other stock exchange on which shares of the Company’s
Common Stock are principally traded and approved for listing at such
time.
7. Miscellaneous.
7.1 Waivers and
Amendments. Any provision of this Agreement or any of the
Notes may be amended, waived or modified (either generally or in a particular
instance, either retroactively or prospectively, either for a specified period
of time or indefinitely), upon the written consent of the Company and the
Investors holding at least seventy-five percent (75%) of the aggregate principal
amount of the outstanding Notes issued at the Initial Closing and any Subsequent
Closings; provided, that this Agreement or any of the Notes may not be amended
or modified and no provision hereof or thereof may be waived if such amendment,
modification or waiver would adversely and prejudicially affect the rights of an
Investor vis-à-vis all other Investors without the consent of such affected
Investor.
7.2 Governing
Law. This Agreement and the Notes shall be governed by and
construed in accordance with Maryland law, without regard to the conflict of
laws provisions thereof.
7.3 Survival. The
representations, warranties, covenants and agreements made herein shall survive
any investigation made by any Investor and the Closing of the transactions
contemplated hereby.
7.4 Successors and
Assigns. Except as otherwise expressly provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties
hereto.
7.5 Entire
Agreement. This Agreement (including the exhibits attached
hereto) and the Notes constitute the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof.
7.6 Notices,
etc. All notices and other communications required or
permitted hereunder shall be effective upon receipt, shall be in writing, and
may be delivered in person, by telecopy (with confirmation of transmission),
electronic mail, overnight delivery service or United States mail, in which
event they may be mailed by first-class, certified or registered, postage
prepaid, addressed (a) if to the Investor, at the Investor’s address as the
Investor shall have furnished to the Company in writing, or, until any such
holder so furnishes an address to the Company, then to and at the address of the
last holder of such shares who has so furnished an address to the Company, and a
copy of which shall be likewise delivered to such Investor’s counsel at such
address as shall have been furnished to the Company, or (b) if to the
Company, at its address set forth on the signature page hereto, or at such other
address as the Company shall have furnished to the Investor and each such other
holder in writing.
7.7 Severability of this
Agreement. If any provision of this Agreement shall be
judicially determined to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
7.8 Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall be
an original, but all of which together shall be deemed to constitute one
instrument.
7.9 Expenses. Regardless
of whether the Closing is effected, each party shall pay all costs and expenses
that it incurs with respect to the negotiation, execution, delivery and
performance of this Agreement and the other Transaction Documents; except that
the Company shall bear up to $15,000 of legal costs and expenses incurred by the
Investor with respect to the negotiation, execution, delivery and performance of
this Agreement and the other Transaction Documents.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK.]
IN
WITNESS WHEREOF, the parties have caused this Note and Share Purchase Agreement
to be duly executed and delivered by their proper and duly authorized officers
as of the date and year first written above.
COMPANY:
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By
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_____________________________
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Its
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_____________________________
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Address:
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_____________________________
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_____________________________
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_____________________________
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INVESTOR:
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___________________
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By
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_____________________________
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Title
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_____________________________
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Address:
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_____________________________
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_____________________________
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_____________________________
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7
SCHEDULE
A
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Investor
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Loan
Amount
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Shares
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||||||
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Xxxxxx
X. Xxxxxxxx 1998
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Charitable
Remainder Unitrust
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$ | 2,000,000.00 | 200,000 | |||||
8
EXHIBIT A
FORM OF UNSECURED PROMISSORY
NOTE
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND
NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF, AND
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY
NOT BE SOLD, TRANSFERRED OR ASSIGNED UNLESS COVERED BY AN EFFECTIVE REGISTRATION
STATEMENT UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER TO
THE EFFECT THAT ANY SUCH TRANSFER IS EXEMPT FROM SUCH REGISTRATION.
UNSECURED
PROMISSORY NOTE
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$____,000
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[Date]
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Bethesda,
MD
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1. Principal and
Interest.
1.1 India
Globalization Capital, Inc., a Maryland corporation (the “Company”), for value
received, hereby promises to pay to the order of __________ or its assigns (the
“Investor” or the “Holder”) the amount of ____ Dollars ($____,000) plus
interest, as set forth hereinafter.
1.2 This
Unsecured Promissory Note (the “Note”) shall bear interest from the date of
issuance of this Note until paid in full at a rate equal to six percent (6%) per
annum, accruing monthly in arrears. This Note, including all interest
earned on the principal amount of this Note, shall be due and payable on the
earlier of (i) one year from the date of the issuance of this Note (the
“Maturity Date”), (ii) upon a Change in Control (as defined in Section 4 hereof)
and (iii) the occurrence of an Event of Default (as defined in Section 5
hereof).
1.3 Payments
of both principal and interest are to be made at the address of the Holder set
forth in Section 7 below or at such other place in the United States as the
Holder shall designate to the Company in writing, in lawful money of the United
States of America in immediately available funds. Interest on this
Note shall be computed on the basis of a 365-day year and actual days
elapsed. Payment shall be credited first to the accrued interest then
due and payable and the remainder applied to principal.
1.4 This Note
is issued pursuant to that certain Note and Share Purchase Agreement dated as of
________________ between the Company and Holder (the “Purchase
Agreement”). The provisions of this Note are a statement of the
rights of the Holder and the conditions to which this Note is subject and to
which the Holder, by the acceptance of this Note, agrees. Capitalized
terms used and not otherwise defined herein shall have the meanings ascribed
thereto on the Purchase Agreement. Holder acknowledges and agrees
that the payment of all or any portion of the outstanding principal amount of
this Note and all interest hereon shall be pari passu in right of payment and in
all other respects to the other Notes issued pursuant to the Purchase Agreement
or pursuant to the terms of such Notes. In the event Holder receives
payments in excess of its pro rata share of the Company’s payments to the
Holders of all of the Notes, then Holder shall hold in trust all such excess
payments for the benefit of the holders of the other Notes and shall pay such
amounts held in trust to such other holders upon demand by such
holders.
2. Prepayment. Notwithstanding
anything else set forth herein, the Company may pre-pay this Note in whole or in
part upon five days prior written notice to Holder.
3. Use of
Proceeds. The proceeds of the Note will be used for working
capital and general corporate purposes.
A-1
4. Change of
Control. If, prior to the Maturity Date or occurrence of an
Event of Default, a Change of Control occurs, then immediately prior thereto,
this Note shall accelerate and the Holder shall become immediately entitled to
receive an amount equal to the outstanding principal amount of the Note plus any
and all accrued but unpaid interest thereon as of the closing date of such
Change of Control transaction. For purposes hereof, a “Change of
Control” shall mean (i) a sale of all or substantially all of the assets of the
Company or all or substantially all of the capital stock of the Company or (ii)
a merger, consolidation, sale, transfer or other transaction or series of
related transactions in which the holders of the capital stock of the Company
will hold, upon consummation of such transaction, less than fifty percent (50%)
of the voting securities of the surviving entity, other than as a result of the
Company’s issuance of new securities in capital raising
transactions.
5. Events of
Default. The entire unpaid principal sum of this Note,
together with any and all interest accrued but unpaid thereon, shall become
immediately due and payable upon the occurrence of an Event of
Default. An “Event of Default” shall be deemed to have occurred
if:
(a) the
Company shall (i) apply for or consent to the appointment of a
receiver, trustee or liquidator of itself or of its property, (ii) be unable, or
admit in writing its inability, to pay its debts as they mature, (iii) make a
general assignment for the benefit of creditors, (iv) be adjudicated a bankrupt
or insolvent, (v) file a voluntary petition in bankruptcy, or a petition or
answer seeking reorganization or an arrangement with creditors to take advantage
of any insolvency law, or an answer admitting the material allegations of a
bankruptcy, reorganization or insolvency petition filed against it, (vi) take
corporate action for the purpose of effecting any of the foregoing, or (vii)
have an order for relief entered against it in any proceeding under the United
States Bankruptcy Code;
(b) An
order, judgment or decree shall be entered, without the application, approval or
consent of the Company by any court of competent jurisdiction, approving a
petition seeking reorganization of the Company or appointing a receiver, trustee
or liquidator of the Company or of all or a substantial part of its assets, and
such order, judgment or decree shall continue unstayed and in effect for any
period of sixty (60) consecutive days; or
(c) the
Company shall fail to pay as and when due any principal or interest hereunder
and such nonpayment shall continue uncured for a period of thirty (30) business
days after written notice by the Holder thereof; or
(d) the
Company breaches any of its representations or warranties or fails to fulfill
any of its covenants or obligations pursuant to the Purchase
Agreement.
6. Usury. It
is the express intent of the Company and the Holder that the payment of all or
any portion of the outstanding principal balance of and accrued interest on this
Note be exempt from the application of any applicable usury law or similar laws
under any federal, state of foreign jurisdiction. The Company hereby
irrevocably waives, to the fullest extent permitted by law, any objection or
defense which the Company may now or hereafter have to the payment when due of
any and all principal or accrued interest arising out of or relating to a claim
of usury or similar laws and the Company hereby agrees that neither it nor any
of its affiliates shall in the future bring, commence, maintain, prosecute or
voluntarily aid in any action at law, proceeding in equity or other legal
proceeding against the Holder based on a claim that the Company’s payment
obligations under this Note violate the usury or similar laws of any federal,
state or foreign jurisdiction. Notwithstanding the foregoing, in the
event any interest is paid on this Note which is deemed to be in excess of the
then legal maximum rate, that portion of the interest payment representing an
amount deemed to be in excess of the then legal maximum rate shall be deemed a
payment of principal and applied against the principal of this
Note.
A-2
7. Notices. Any
notice, request, other communication or payment required or permitted hereunder
shall be in writing and shall be deemed to have been given upon delivery if
personally delivered, or five (5) business days after deposit if deposited in
the United States mail for mailing by certified mail, postage prepaid, and
addressed as follows:
If to
Investor: at the address indicated on the signature page
hereto.
If to
Company: India
Globalization Capital, Inc.
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx,
XX 00000
Attention: Ram
Xxxxxxx
And
XX Xxx 00000
Xxxxxxx,
XX 00000
Telecopier: (000)
000-0000
Phone: (000)
000-0000
Email: xxx@xxxxxxxxxxxxxx.xxx
and
xxxxx@xxxxxxxxxxxxxx.xxx
With a
copy
to: Seyfarth
Xxxx LLP
000 Xxxxxxxxxxx Xxxxxx, X.X., Xxxxx
000
Xxxxxxxxxx,
X.X. 00000
Attention: Xxxxxxx X.
Xxxxxxxxx
Telecopier: (000)
000-0000
Phone: (000)
000-0000
Each of
the above addressees may change its address for purposes of this Section 7
by giving to the other addressee notice of such new address in conformance with
this Section 7.
A-3
8. Assignment. The
rights and obligations of the Company and the Holder of this Note shall be
binding upon and benefit the successors, assigns, heirs, administrators and
transferees of the parties. Effective upon any such assignment, the
person or entity to whom such rights, interests and obligations were assigned
shall have and exercise all of the Holder’s rights, interests and obligations
hereunder as if such person or entity were the original Holder of this
Note.
9. Waiver and
Amendment. Any provision of this Note may be amended, waived
or modified (either generally or in a particular instance, either retroactively
or prospectively, and either for a specified period of time or indefinitely),
upon the written consent of the Company and the Investors holding at least
seventy-five percent (75%) of the aggregate principal amount of the outstanding
Notes issued at the Initial Closing and any Subsequent Closings; provided, that
the Notes may not be amended or modified and no provision thereof may be waived
if such amendment, modification or waiver would adversely and prejudicially
affect the rights of an Investor vis-à-vis all other Investors without the
consent of such affected Investor. No waivers of any term, condition
or provision of this Note, in any one or more instances, shall be deemed to be,
or construed as, a further or continuing waiver of any such term, condition or
provision or a waive of the same or any other term, condition provision or right
on any future occasion.
10. Loss, Theft or Destruction
of Note. Upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft or destruction of this Note and of
indemnity or security reasonably satisfactory to it, the Company will make and
deliver a new Note which shall carry the same rights to interest (unpaid and to
accrue) carried by this Note, stating that such Note is issued in replacement of
this Note, making reference to the original date of issuance of this Note (and
any successors hereto) and dated as of such cancellation, in lieu of this
Note.
11. Accredited
Investor. The Holder represents and warrants that he/she/it is
an “accredited investor” within the meaning of the Securities and Exchange Rule
501 of Regulation D, as presently in effect.
12. Governing Law and Consent to
Jurisdiction. This Note is being delivered in and for all
purposes shall be construed in accordance with and governed by the laws of the
State of Maryland , without regard to the conflicts of laws provisions
thereof. The Company hereby consents to the jurisdiction of and venue
in any court of competent jurisdiction in New York.
13. Issue
Date. The provisions of this Note shall be construed and shall
be given effect in all respects as if this Note had been issued and delivered by
the Company on the earlier of the date hereof or the date of issuance of any
Note for which this Note is issued in replacement. This Note shall be
binding upon any successors or assigns of the Company.
14. Heading;
References. All headings used herein are used for convenience
only and shall not be used to construe or interpret this Note. Except
as otherwise indicated, all references herein to Sections refer to Sections
hereof.
15. Waiver by the
Company. The Company hereby expressly waives demand, notice,
presentment, protest, notice of dishonor and nonpayment of this Note, and all
other notices and demands of any kind in connection with the delivery,
acceptance, performance, default or enforcement hereof.
16. Delays. No
delay by the Holder in exercising any power or right hereunder shall operate as
a waiver of any power or right.
17. Severability. If
one or more provisions of this Note are held to be unenforceable under
applicable law, such provision shall be excluded from this Note and the balance
of the Note shall be interpreted as if such provision were so excluded and shall
be enforceable in accordance with its terms.
18. No
Impairment. The Company will not, by any voluntary action,
avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Company, but will at all times in good
faith assist in the carrying out of all the provisions of this Note and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the Holder of this Note against impairment.
19. Expenses. The
Company agrees to pay all of the Holder’s reasonable costs, fees and expenses,
if any (including reasonable counsel fees and expenses, costs of collection and
court costs), in connection with the enforcement of this Note.
[REMAINDER
OF PAGE LEFT BLANK]
A-4
IN
WITNESS WHEREOF, the Company has caused this Note to be executed in its
corporate name and this Note to be dated, issued and delivered, all on the date
first above written.
a
Maryland corporation
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By
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_____________________________
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Print
Name
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_____________________________
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Title
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_____________________________
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Accepted
and Agreed to:
INITIAL
HOLDER:
| ____________________________ | |
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Print
Name of Holder
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By
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_________________________
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(Signature)
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| ____________________________ | |
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(Print
Name, if signing on behalf of entity)
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| _____________________________ | |
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Title
(if applicable)
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Address:
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_____________________________
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_____________________________
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_____________________________
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A-5
ASSIGNMENT
FORM
(To
Assign the foregoing Note, execute
this form
and supply required information.)
FOR VALUE
RECEIVED, an interest corresponding to the unpaid principal amount of the
foregoing Note and all rights evidenced thereby are hereby assigned
to
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(Please
Print)
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whose
address is
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Dated:
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Holder’s
Signature:
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Holder’s
Address:
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Signature
Guaranteed:
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NOTE:
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The
signature to this Assignment Form must correspond with the name as it
appears on the face of the Note, without alteration or enlargement or any
change whatever, and must be guaranteed by a bank or trust
company. Officers of corporations and those acting in a
fiduciary or other representative capacity should file proper evidence of
authority to assign the foregoing
Note.
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EXHIBIT B
DISCLOSURE
SCHEDULE
Section
2.4
The
following SEC Documents were not timely filed:
Annual Report on Form 10-KSB for the
fiscal year ended March 31, 2008
Section
2.9
The
Company may incur such fees and/or commissions in connection with Loans
consummated at any of the Subsequent Closings.
B-1
