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As filed with the Securities and Exchange Commission on February 14, 2006
Securities Act File No. 333-124942
 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
Amendment No. 6
to
Form S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
 
India Globalization Capital, Inc.
(Exact name of Registrant as specified in charter)
         
Maryland   6770   20-2760393
(State or other jurisdiction of
incorporation or organization)
  (Primary Standard Industrial
Classification Code Number)
  (I.R.S. Employer
Identification Number)
4336 Montgomery Ave.
Bethesda, Maryland 20814
(301) 983-0998
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Ram Mukunda
Chief Executive Officer and President
India Globalization Capital, Inc.
4336 Montgomery Ave.
Bethesda, Maryland, 20814
(301) 983-0998
(Name, address, including zip code, and telephone number, including area code, of agent for service)
 
Copies to:
     
Michael E. Blount, Esq.
Stanley S. Jutkowitz, Esq.
Seyfarth Shaw LLP
55 East Monroe Street, Suite 4200
Chicago, Illinois 60603-5803
Telephone: (312) 346-8000
Facsimile: (312) 269-8869
  Arthur S. Marcus, Esq.
Peter J. Gennuso, Esq.
Kristin J. Angelino, Esq.
Gersten Savage LLP
600 Lexington Avenue
New York, New York 10022
Telephone: (212) 752-9700
Facsimile: (212) 980-5192
           Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement.
         The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
Amending the Prospectus, Part II and filing certain exhibits
 
 


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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED FEBRUARY 13, 2006
PRELIMINARY PROSPECTUS
$58,980,000
India Globalization Capital, Inc.
9,830,000 Units
     India Globalization Capital, Inc. is a blank check company recently formed for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition or other similar business combination, one or more operating businesses with primary operations in India.
     This is an initial public offering of our securities. Each unit that we are offering consists of:
  •  one share of our common stock; and
  •  two warrants.
     The units are being offered at a price of $6.00 per unit.
     Each warrant entitles the holder to purchase one share of our common stock at a price of $5.00. Each warrant will become exercisable on the later of our completion of a business combination or                  , 2007 [one year from the date of this prospectus] , and will expire on                  , 2011 [five years from the date of this prospectus] , or earlier upon redemption.
     We have granted the underwriters a 45-day option to purchase up to 1,474,500 additional units solely to cover over-allotments, if any (over and above the 9,830,000 units referred to above). The over-allotment will be used only to cover the net syndicate short position resulting from the initial distribution. We have also agreed to sell to Ferris, Baker Watts, Inc., the representative of the underwriters, for $100, an option to purchase up to a total of 500,000 units at $7.50 per unit (125% of the price of the units sold in the offering). The units issuable upon exercise of this option are identical to those offered by this prospectus, except that each of the warrants underlying such units entitles the holder to purchase one share of our common stock at a price of $6.25 (125% of the exercise price of the warrants included in the units sold in the offering). The purchase option and its underlying securities have been registered under the registration statement of which this prospectus forms a part.
     Our officers and directors have agreed to purchase an aggregate of 170,000 units at a price of $6.00 per unit ($1,020,000 in the aggregate) in a private placement that will occur immediately prior to this offering. Such units will be identical to the units in this offering. These individuals will not have any right to any liquidation distributions with respect to the shares included in such private placement units in the event we fail to consummate a business combination. The shares comprising such units may not be sold, assigned or transferred until we consummate a business combination. Such individuals have further agreed to waive their right to any liquidation distributions with respect to such shares in the event we fail to consummate a business combination.
     There is presently no public market for our units, common stock or warrants. We have applied to have our units listed on the American Stock Exchange under the symbol IGC.U, subject to official notice of listing. Once the securities comprising the units begin separate trading, the common stock and warrants will also be listed on the American Stock Exchange under the symbols IGC and IGC.WS, respectively. We cannot assure you, however, that any of such securities will be or continue to be listed on the American Stock Exchange. In the event that the securities are not listed on the American Stock Exchange, we anticipate that the units will be quoted on the OTC Bulletin Board but we cannot assure you that our securities will be so quoted or, if quoted, will continue to be quoted.
     Investing in our securities involves a high degree of risk. See “Risk Factors” beginning on page 10 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities .
     Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
                         
        Underwriting    
    Public Offering   Discount and   Proceeds, Before
    Price   Commission(1)   Expenses, to Us
             
Per unit
  $ 6.00     $ .48     $ 5.52  
Total
  $ 58,980,000     $ 4,718,400     $ 54,261,600  
 
(1)  Includes a non-accountable expense allowance in the amount of 3% of the gross proceeds, or $.18 per unit ($1,769,400 in total), payable to Ferris, Baker Watts, Inc., the representative of the underwriters. Ferris, Baker Watts, Inc. has agreed to deposit 3% of the gross proceeds attributable to the non-accountable expense allowance ($.18 per Unit) into the trust account until the earlier of the completion of a business combination or the liquidation of the trust account. They have further agreed to forfeit any rights to or claims against such proceeds unless we successfully complete a business combination.
     Of the proceeds of this offering, $57,210,600 (approximately $5.82 per unit) will be deposited into a trust account at United Bank Inc. maintained by Continental Stock Transfer & Trust Company acting as trustee. This amount includes up to $1,769,400 ($0.18 per unit) which will be paid to the underwriters if a business combination is consummated, but which will be forfeited by the underwriters if a business combination is not consummated. This amount also includes the net proceeds from the 170,000 units being purchased in a private placement immediately prior to this offering by our officers and directors or their nominees, which they have agreed to forfeit if a business combination is not consummated. This amount also includes loans from our founders in the aggregate amount of $870,000 which will be repaid from the interest accrued on the amount in escrow, but will not be repaid from the principal in escrow. As a result, our public stockholders will receive $5.82 per unit (97% of the initial purchase price of the units) (plus residual interest earned but net of $1,855,000 in working capital and taxes payable) in the event of a liquidation of our company prior to consummation of a business combination.
     We are offering the units for sale on a firm-commitment basis. Ferris, Baker Watts, Inc., acting as representative of the underwriters, expects to deliver our securities to investors in the offering on or about         , 2006.
     
Ferris, Baker Watts
        Incorporated
  Ladenburg Thalmann & Co. Inc.
First Albany Capital Merriman Curhan Ford & Co.
SG Corporate & Investment Banking
The date of this Prospectus is                  , 2006


 

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    F-1  
  Form of Underwriting Agreement
  By-laws
  Form of Investment Management Trust Agreement
  Promissory Note
  Extension of Due Date of Promissory Note
  Form of Stock and Unit Escrow Agreement
  Form of Warrant Purchase Agreement
  Letter Advisory Agreement
  Promissory Note
  Extension of Due Date of Promissory Note
  Form of Promissory Note
  Consent of Goldstein Golub Kessler LLP
 
      You should rely only on the information contained or incorporated by reference in this prospectus. We have not and the underwriters have not authorized anyone to provide you with different information. We are not making an offer of these securities in any jurisdiction where the offer is not permitted.
 


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PROSPECTUS SUMMARY
      This summary highlights certain information appearing elsewhere in this prospectus. For a more complete understanding of this offering, you should read the entire prospectus carefully, including the risk factors set forth in the section below entitled “Risk Factors” and the financial statements, and the related
notes and schedules thereto. Unless otherwise stated in this prospectus, references to “we,” “us” or “our” refer to India Globalization
Capital, Inc. sometimes referred to herein as IGC, Inc. You should rely only on the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with different information. We are not making an offer of these securities in any jurisdiction where that offer is not permitted. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters have not exercised their over-allotment option.
      Unless we tell you otherwise, the term “business combination” as used in this prospectus means an acquisition of, through a merger, capital stock exchange, asset acquisition or other business acquisition, one or more operating businesses. In addition, unless we tell you otherwise, the term “public stockholder” as used in this prospectus refers to those persons that purchase the securities offered by this prospectus including any of our existing stockholders that purchase these securities either in this offering or afterwards; provided that our existing stockholders’ status as “public stockholders” shall exist only with respect to those securities so purchased in this offering or afterwards. Unless we tell you otherwise, references in this prospectus to “units” include 170,000 units that certain of our officers and directors or their nominees have agreed to purchase in a private placement immediately prior to this offering. Certain numbers in this
prospectus have been rounded.
      IGC, Inc. is a recently organized Maryland blank check company formed on April 29, 2005, for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition or other similar business combination or acquisition, one or more businesses with operations primarily in India. To date, our efforts have been limited to organizational activities.
      We believe that the future potential of the Indian economy and current market conditions present favorable opportunities for acquisitions of Indian companies. According to the World Factbook published by the U.S. Central Intelligence Agency, the Indian economy has posted a growth rate of approximately 6.8% since 1994, and has become the fourth largest economy in the world. According to the World Factbook, the Indian economy had a Gross Domestic Product in 2004 of approximately $3.319 trillion and its growth rate in 2004 was approximately 6.2%.
      In addition, according to Mega Ace Consultancy, an India-based think tank studying the Indian economy, since mid-1991, the Indian government has committed itself to implementing an economic structural reform program with the objective of liberalizing India’s exchange and trade policies, reducing the fiscal deficit, controlling inflation, promoting a sound monetary policy, reforming the financial sector, and placing greater reliance on market mechanisms to direct economic activity. Mega Ace’s principals include a former economic advisor to the Central Bank — Reserve Bank of India and a former CEO of the Bombay Stock Exchange. Mega Ace’s projects include serving as chief consultant to an agency looking to promote investment in France among Indian investors and serving as a south-Asian consultant to a project devoted to forming links between small and medium sized enterprises in the UK and Europe with companies based in South Asia. According to Mega Ace, a significant component of the program is the promotion of foreign investment in key areas of the economy and the further development of, and the relaxation of restrictions in, the private sector. As a result, we believe the regulatory environment for foreign investment has become more favorable. There are already a number of industry sectors, including, but not limited to, telecommunications, drug and pharmaceuticals, banking and insurance, airports and airlines and mining and petroleum that have been deregulated
whereby foreign investors can own and control Indian companies and where profits can be reinvested in India or repatriated to the U.S.
      While we are not limiting our acquisition of target businesses in India to any particular sector, we believe that the following two sectors are illustrative of the opportunities that we may consider for prospective target businesses: (1) business process outsourcing and information technology and (2) infrastructure. Our strategy in any sector will be to identify potential “market sector leaders” which we think will grow at a substantially faster rate than the overall economy.

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      Our management team is experienced in starting, financing, growing, operating, sourcing, structuring and consummating business combinations in India as well as in North America, Europe and Asia. Through our management team, directors and our advisors, we believe that we have extensive contacts and sources, including private equity and venture capital funds, public and private companies, investment bankers, attorneys and accountants, from which to generate acquisition opportunities. Our management team intends to use its operating and transaction experience to find and evaluate potential target companies and to maintain and build on the relationships that they have developed through their years of experience in the U.S. and Indian business arenas.
      While we may seek to effect business combinations with more than one target business, our initial business acquisition must be with one or more operating businesses whose fair market value, collectively, is at least equal to 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of such acquisition. Consequently, if we cannot identify and acquire multiple operating businesses contemporaneously, we will need to identify and acquire a larger single operating business. There are also certain risks associated with investing in a development stage company such as ours. Certain state administrators may disallow an offering of a development stage company if the initial equity investment by a company’s promoters does not equal a certain percentage of the aggregate public offering price. For a more complete discussion of certain states’ requirements concerning promoter’s equity percentage in a development stage company, please see the section below entitled “Risk Factors — Risks associated with our business.”
      IGC, Inc is a Maryland corporation formed on April 29, 2005. Our offices are located at 4336 Montgomery Avenue, Bethesda, Maryland 20814. Our telephone number is (301) 983-0998.
Private Placement
      Certain of our officers and directors and their nominees have agreed to purchase from us an aggregate of 170,000 units at $6.00 per unit in a private placement that will occur immediately prior to this offering.

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THE OFFERING
      In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company, as well as the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act of 1933, as amended, and, therefore, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled “Risk Factors” beginning on page 10 of this prospectus.
     
Securities Offered:
  9,830,000 units, at $6.00 per unit, each unit consisting of:
    • one share of common stock; and
    • two warrants.
    The units will begin trading on or promptly after the date of this prospectus. Each of the common stock and warrants will trade separately on the 90th day after the date of this prospectus unless Ferris, Baker Watts, Inc. determines that an earlier date is acceptable, based upon its assessment of the relative strengths of the securities market and small capitalization companies in general, and the trading pattern of, and demand for, our securities in particular. In no event will Ferris, Baker Watts, Inc. allow separate trading of the common stock and warrants until we file an audited balance sheet reflecting our receipt of the gross proceeds of this offering. We will file a Current Report on Form 8-K, including an audited balance sheet, upon the consummation of this offering, which is anticipated to take place three business days from the date the units commence trading. The audited balance sheet will include proceeds we receive from the exercise of the over-allotment option if the over-allotment option is exercised prior to the filing of the Current Report on Form 8-K. If the over-allotment option is exercised after our initial filing of a Form 8-K, we will file an amendment to the Form 8-K to provide updated financial information to reflect the exercise of the over-allotment option. We will also include in this Form 8-K, or amendment thereto, or in a subsequent Form 8-K information indicating if Ferris, Baker Watts, Inc. has allowed separate trading of the common stock and warrants prior to the 90th day after the date of this prospectus.
Common Stock:
   
Number of shares that will be outstanding before this offering and the private placement:
  2,500,000 shares
Number of shares to be outstanding after this offering and the private placement:
  12,500,000 shares

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Warrants:
   
Number of warrants outstanding before this offering and the private placement:
  0 warrants
Number of warrants to be outstanding after this offering and the private placement:
  20,000,000 warrants
Exercisability:
  Each warrant is exercisable for one share of common stock.
Exercise price:
  $5.00
Exercise period:
  The warrants will become exercisable on the later of:
    • the completion of a business combination on terms as described in this prospectus; or
    •       , 2007 [one year from the date of this prospectus].
    • The warrants will expire at 5:00 p.m., Washington, DC time, on           , 2011 [five years from the date of this prospectus] , or earlier upon redemption.
    None of the warrants may be exercised until after the consummation of a business combination and, thus, after the proceeds of the trust account have been disbursed. Upon exercise of the warrants and disbursement of the trust, the warrant exercise price will be paid directly to us.
Redemption:
  We may redeem the outstanding warrants (including warrants held by Ferris, Baker Watts, Inc. as a result of the exercise of the purchase option):
    • in whole and not in part;
    • at a price of $.01 per warrant at any time after the warrants become exercisable;
    • upon a minimum of 30 days’ prior written notice of redemption; and
    • if, and only if, the last sales price of our common stock equals or exceeds $8.50 per share for any 20 trading days within a 30 trading day period ending three business days before we send the notice of redemption.

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    We have established our redemption criteria to provide warrant holders with a premium to the initial warrant exercise price as well as a reasonable cushion against a negative market reaction, if any, to our redemption call. If the foregoing conditions are satisfied, we will call the warrants and each warrant holder will be entitled to exercise his or her warrants prior to the date scheduled for redemption. There can be no assurance, however, that the price of the common stock will exceed $8.50 or the warrant exercise price after the redemption call is made.
Proposed American Stock Exchange symbols for our securities:
   
Units:
  IGC.U
Common Stock:
  IGC
Warrants:
  IGC.WS
Offering proceeds to be held in trust:
  $57,210,600 of the proceeds of this offering and the private placement (approximately $5.82 per unit) will be placed in a trust account at United Bank maintained by Continental Stock Transfer & Trust Company acting as trustee, pursuant to an agreement to be signed on the date of this prospectus. These proceeds consist of $55,441,200 from the net proceeds payable to us and $1,769,400 of the proceeds attributable to the underwriters’ non-accountable expense allowance. These proceeds will not be released until the earlier of (i) the completion of a business combination on the terms as described in this prospectus or (ii) our liquidation. Therefore, unless and until a business combination is consummated, these proceeds held in the trust account will not be available for our use for any expenses related to this offering or expenses which we may incur related to the investigation and selection of a target business and the negotiation of an agreement to effect the business combination. These expenses will be paid prior to a business combination only from the interest earned by the principal in the trust accounts up to an aggregate of $1,855,000. The $1,769,400 of the proceeds attributable to the underwriters’ non-accountable expense allowance which are being held in the trust account will be released to Ferris, Baker Watts, Inc. upon completion of a business transaction on the terms described in this prospectus or to our public stockholders upon our liquidation and will in no event be available for use by us.

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    We may use a portion of the funds not held in the trust account to make a deposit or fund a “no-shop, standstill” provision with respect to a prospective business combination. In the event that we are required to forfeit such funds (whether as a result of a breach of the agreement relating to such payment or otherwise), we may not have sufficient working capital available to pay expenses related to locating a suitable business combination without securing additional financing. In such event, if we are unable to secure additional financing, we may not consummate a business combination in the proscribed time period and we will be forced to liquidate and dissolve.
    Prior to the consummation of a business combination, there will be no fees, reimbursements or cash payments made to our existing stockholders and/or officers and directors other than:
    • Repayment of loans in the aggregate principal amount of $870,000 with interest at the rate of 4% per annum made by our chief executive officer and our chairman to us to cover offering expenses and working capital;
    • Payment of up to $4,000 per month to affiliates of our existing stockholders for office space and administrative expenses;
    • Reimbursement for any expenses incident to the offering and finding a suitable business combination; and
    • Fees payable to our officers, directors and advisers in kind for services to be rendered.
    Other than the agreement with IGN, LLC, with respect to rent for office space and administrative expenses, there are no current agreements or understandings with any of our existing stockholders or any of their respective affiliates with respect to the payment of compensation of any kind subsequent to a business combination. However, there can be no assurance that such agreements may not be negotiated in connection with, or subsequent to, a business combination.

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The stockholders must approve business
combination:
  We will seek stockholder approval before we effect our initial business combination, even if the nature of the acquisition would not ordinarily require stockholder approval under applicable state law. In connection with the vote required for our initial business combination, all of our existing stockholders, including all of our officers, directors and special advisors, have agreed to vote the shares of common stock owned by them (whether purchased prior to, during or after the consummation of the offering or the private placement) in accordance with the majority of the shares of common stock voted by the public stockholders other than our existing stockholders. Accordingly, they will not be entitled to exercise the conversion rights described below for public stockholders who vote against a business combination. We will proceed with a business combination only if: (i) a majority of the shares of common stock voted by the public stockholders are voted in favor of the business combination and (ii) public stockholders owning less than an aggregate of 20% of the shares sold in this offering and purchased in the private placement subsequently exercise their conversion rights described below.
Conversion rights for stockholders voting to reject a business combination:
  Public stockholders voting against a business combination will be entitled to convert their stock into a pro rata share of the trust account (approximately $5.82 per share), plus any interest earned on their portion of the trust account, net, of working capital (up to a maximum of $1,855,000) and taxes, if the business combination is approved and consummated.

In order to exercise this right, the public stockholders must make an affirmative election. Voting against a business combination does not automatically trigger the conversion right. Public stockholders who convert their shares of stock into their share of the trust account will continue to have the right to exercise any warrants they may hold.

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Liquidation if no business combination:
  We will dissolve and promptly distribute only to our public stockholders the amount in our trust account inclusive of the $1,769,400 attributable to the underwriters’ non-accountable expense allowance, plus any remaining net assets, if we do not effect a business combination within 18 months after consummation of this offering (or within 24 months after the consummation of this offering if a letter of intent, agreement in principle or definitive agreement has been executed within 18 months after consummation of this offering and the business combination relating thereto has not yet been consummated within such 18-month period). The existing stockholders have agreed to waive their respective rights to participate in any liquidation distribution occurring upon our failure to consummate a business combination, but only with respect to those shares of common stock acquired by them prior to this offering and with respect to the shares included in the 170,000 units our officers and directors or their nominees are purchasing in the private placement; they will participate in any liquidation distribution with respect to any shares of common stock acquired in connection with or following this offering.
Escrow of existing stockholder shares:
  On the date of this prospectus, all of our existing stockholders (which includes all of our officers, directors and special advisors) will place the shares of common stock they own prior to this offering and the private placement into an escrow account maintained by Continental Stock Transfer & Trust Company, acting as escrow agent. Subject to certain limited exceptions, such as transfers to family members and trusts for estate planning purposes and upon death, while in each case remaining in the escrow account, these shares will not be released from escrow until six months after the consummation of a business combination. The shares will only be released prior to that date if we are forced to liquidate, in which case the shares would be destroyed, or if we were to consummate a transaction after the consummation of a business combination which results in all of the stockholders of the combined entity having the right to exchange their shares of common stock for cash, securities or other property.

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Summary Financial Data
      The following table summarizes the relevant financial data for our business and should be read in conjunction with our financial statements, and the related notes and schedules thereto, which are included in this prospectus. To date, our efforts have been limited to organizational activities so only balance sheet data is presented.
                   
    December 31, 2005
     
    Actual   As Adjusted(1)
         
Balance Sheet Data:
               
 
Working capital (deficiency)
  $ (762,218 )   $ 54,460,681  
 
Total assets
    762,463       55,435,681  
 
Total liabilities
    767,982       975,000  
 
Value of common stock that may be converted to cash
(approximately $5.82 per share) 2
          11,634,180  
 
Stockholders’ equity (deficiency)
  $ (5,519 )     42,826,501  
 
(1)  Excludes the $100 purchase price of the purchase option payable by Ferris, Baker Watts, Inc.
 
(2)  Includes .18¢ per share escrowed from the underwriters’ fees.
      The working capital excludes $756,699 of costs related to this offering and the private placement which were paid or accrued prior to December 31, 2005. These deferred offering costs have been recorded as a long-term asset and are reclassified against stockholders’ equity in the “as adjusted” column.
      The “as adjusted” information gives effect to the sale of the units in this offering and the private placement, including the application of the estimated gross proceeds and the payment of the estimated remaining costs from such sale.
      The working capital (as adjusted) and total assets (as adjusted) amounts will be available to us only upon the consummation of a business combination within the time period described in this prospectus. If a business combination is not so consummated, we will be dissolved and the proceeds held in the trust account will be distributed solely to our public stockholders.
      We will not proceed with a business combination if public stockholders owning 20% or more of the shares sold in this offering and the private placement vote against the business combination and then subsequently exercise their conversion rights. Accordingly, if public shareholders owning a majority of the shares sold in this offering approve a business combination, we may effect that business combination even if public stockholders owning up to approximately 19.99% of the shares sold in this offering and the private placement exercise their conversion rights. If this occurs, we would be required to convert to cash up to approximately 19.99% of the 10,000,000 shares of common stock sold in this offering and the private placement, or 1,999,000 shares of common stock, at an initial per-share conversion price of approximately $5.82, without taking into account interest earned on the trust account. The actual per-share conversion price will be equal to the amount deposited in the trust account, including all accrued interest, through the record date for the determination of stockholders entitled to vote on the proposed business combination.

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RISK FACTORS
      An investment in our securities involves a high degree of risk. You should consider carefully all of the material risks described below, together with the other information contained in this prospectus, before making a decision to invest in our securities. If any of the following risks occur, our business and financial conditions may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Additional risks not currently known to us, or that we deem immaterial, may also harm us or affect your investment. We make various statements in this section which constitute “forward-looking statements”. See “Forward-Looking Statements.”
Risks associated with our business
We are a development stage company with no operating history and, accordingly, you will have no basis upon which to evaluate our ability to achieve our business objective.
      We are a recently incorporated development stage company with no operating results to date. Therefore, our ability to begin operations is dependent upon obtaining financing through the public offering of our securities. Because we do not have an operating history, you will have no basis upon which to evaluate our ability to achieve our business objective, which is to acquire one or more operating businesses with primary operations in India. We have not conducted any discussions and we have no plans, arrangements or understandings with any prospective acquisition candidates. We will not generate any revenues (other than interest income on the proceeds of this offering) until, at the earliest, after the consummation of a business combination. We cannot assure you as to when or if a business combination will occur.
We may not be able to consummate a business combination within the required time frame, in which case, we would be forced to liquidate.
      We must complete a business combination with a fair market value of at least 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of acquisition within 18 months after the consummation of this offering (or within 24 months after the consummation of this offering if a letter of intent, agreement in principle or a definitive agreement has been executed within 18 months after the consummation of this offering and the business combination relating thereto has not yet been consummated within such 18-month period). If we fail to consummate a business combination within the required time frame, we will be forced to liquidate our assets. We may not be able to find suitable target businesses within the required time frame. In addition, our negotiating position and our ability to conduct adequate due diligence on any potential target may be reduced as we approach the deadline for the consummation of a business combination. We do not have any specific merger, capital stock exchange, asset acquisition or other similar business combination under consideration and have not had any discussions, formal or otherwise, with respect to such a transaction.
If we are forced to liquidate before a business combination, our public stockholders will receive less than $6.00 per share upon distribution of the trust account and our warrants will expire worthless.
      If we are unable to complete a business combination and are forced to liquidate our assets, the per-share liquidation will be less than $6.00 because of the expenses related to this offering, our general and administrative expenses and the anticipated costs of seeking a business combination. Furthermore, the warrants will expire worthless if we liquidate before the completion of a business combination. For a more complete description on the effects on our stockholders if we are unable to complete a business combination, see the section below entitled “Proposed Business — Effecting a business combination — Liquidation if no business combination.”
You will not be entitled to protections normally afforded to investors of blank check companies under federal securities laws.
      Because the net proceeds of this offering are intended to be used to complete a business combination with one or more operating businesses that have not been identified, we may be deemed to be a “blank check”

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company under the federal securities laws. However, since we will have net tangible assets in excess of $5,000,000 upon the successful consummation of this offering and our units are being offered at an initial price of $6.00 per unit, we believe that we are exempt from rules promulgated by the SEC to protect investors of blank check companies such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Because we do not believe we are subject to Rule 419, our units will be immediately tradeable and we have a longer period of time within which to complete a business combination in certain circumstances. For a more detailed comparison of our offering to offerings under Rule 419, see the section below entitled “Proposed Business — Comparison to offerings of blank check companies.”
  If third parties bring claims against us, the proceeds held in trust could be reduced and the per-share liquidation or conversion price received by stockholders may be less than approximately $5.82 per share.
      Our placing of funds in trust may not protect those funds from third party claims against us. Although we will seek to have all vendors, prospective target businesses or other entities we engage execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders, there is no guarantee that they will execute such agreements, or even if they execute such agreements that they would be prevented from bringing claims against the trust account. If any third party refused to execute an agreement waiving such claims to the monies held in the trust account, we would perform an analysis of the alternatives available to us if we chose not to engage such third party and evaluate if such engagement would be in the best interest of our stockholders if such third party refused to waive such claims. Examples of possible instances where we may engage a third party that refused to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a provider of required services willing to provide the waiver. In addition, there is no any guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Accordingly, the proceeds held in trust could be subject to claims which could take priority over the claims of our public stockholders and the per-share liquidation price could be less than approximately $5.82 plus partial interest, due to claims of such creditors. If we are unable to complete a business combination and are forced to liquidate, our officers and directors will be personally liable under certain circumstances to ensure that the proceeds in the trust account are not reduced by the claims of various vendors or other entities that are owed money by us for services rendered or products sold to us. However, we cannot assure you that our officers and directors will be able to satisfy those obligations. In addition, such third party claims may result in the per share conversion price received by stockholders who vote against a business combination and elect to convert their shares into cash being less than approximately $5.82 per share.
Because we have not currently selected any prospective target businesses with which to complete a business combination, investors in this offering are unable to currently ascertain the merits or risks of any particular target business’ operations.
      Because we have not yet identified any prospective target businesses, investors in this offering have no current basis to evaluate the possible merits or risks of any particular target business’ operations. To the extent we complete a business combination with a financially unstable company or an entity in its development stage, we may be affected by numerous risks inherent in the business operations of those entities. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors, or that we will have adequate time to complete due diligence. We also cannot assure you that an investment in our units will not ultimately prove to be less favorable to investors in this offering than a direct investment, if an opportunity were available, in any particular target business. For a more complete discussion of our selection of target businesses, see the section below entitled “Proposed Business — Effecting a business combination — We have not identified any target businesses.”

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We may issue shares of our capital stock, including through convertible debt securities, to complete a business combination, which would reduce the equity interest of our stockholders and likely cause a change in control of our ownership.
      Our certificate of incorporation authorizes the issuance of up to 75,000,000 shares of common stock, par value $.0001 per share and 1,000,000 shares of preferred stock, par value $.0001 per share. Immediately after this offering (assuming no exercise of the underwriters’ over-allotment option), there will be 41,000,000 authorized but unissued shares of our common stock available for issuance (after appropriate reservation for the issuance of shares upon full exercise of our outstanding warrants and the purchase option granted to Ferris, Baker Watts, Inc.) and all of the 1,000,000 shares of preferred stock available for issuance. Although we have no commitments as of the date of this offering to issue any securities, we may issue a substantial number of additional shares of our common stock or preferred stock or a combination of both, including through convertible debt securities, to complete a business combination. The issuance of additional shares of our common stock including upon conversion of any debt securities:
  •  may significantly reduce the equity interest of investors in this offering;
 
  •  will likely cause a change in control if a substantial number of our shares of common stock or voting preferred are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and most likely also result in the resignation or removal of our present officers and directors;
 
  •  may adversely affect the voting power or other rights of holders of our common stock if we issue preferred stock with dividend, liquidation, compensation or other rights superior to the common stock; and
 
  •  may adversely affect prevailing market prices for our common stock, warrants or units.
      For a more complete discussion of the possible structure of a business combination, see the section below entitled “Proposed Business — Effecting a business combination — Selection of target businesses and structuring of a business combination.”
We may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial condition.
      Although we have no commitments as of the date of this offering to incur any debt, we may choose to incur a substantial amount of debt to finance a business combination. The incurrence of debt:
  •  may lead to default and foreclosure on our assets if our operating revenues after a business combination are insufficient to pay our debt obligations;
 
  •  may cause an acceleration of our obligations to repay the debt even if we make all principal and interest payments when due if we breach the covenants contained in the terms of the debt documents;
 
  •  may create an obligation to immediately repay all principal and accrued interest, if any, upon demand to the extent any debt securities are payable on demand; and
 
  •  may hinder our ability to obtain additional financing, if necessary, to the extent any debt securities contain covenants restricting our ability to obtain additional financing while such security is outstanding, or to the extent our existing leverage discourages other potential investors.
      For a more complete discussion of the possible structure of a business combination, see the section below entitled “Proposed Business — Effecting a business combination — Selection of target businesses and structuring of a business combination.”
Our current officers and directors may resign upon consummation of a business combination.
      Our ability to successfully effect a business combination will be totally dependent upon the efforts of our key personnel. The future role of our key personnel, particularly Dr. Ranga Krishna, our Chairman of the

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Board, Ram Mukunda, our Chief Executive Officer and President and John Cherin, our Chief Financial Officer, Treasurer, following a business combination, however, cannot presently be ascertained. While several of our management and other key personnel, particularly Messrs. Mukunda and Cherin, have indicated their willingness to remain associated with us following a business combination, we have no current expectation that they will do so, and we may employ other personnel following the business combination. Moreover, our current management will only be able to remain with the combined company after the consummation of a business combination if they are able to negotiate the same as part of any such combination. If we acquired a target business in an all-cash transaction, it would be more likely that current members of management would remain with us if they chose to do so. If a business combination were structured as a merger whereby the stockholders of the target company were to control the combined company following a business combination, it may be less likely that management would remain with the combined company unless it was negotiated as part of the transaction via the acquisition agreement, an employment agreement or other arrangement. In making the determination as to whether current management should remain with us following the business combination, management will analyze the experience and skill set of the target business’ management and negotiate as part of the business combination that certain members of current management remain if it is believed that it is in the best interests of the combined company post-business combination. If management negotiates to be retained post-business combination as a condition to any potential business combination, such negotiations may result in a conflict of interest.
Our ability to successfully effect a business combination and to be successful afterwards will be completely dependent upon the efforts of our key personnel, some of whom may join us following a business combination and whom we would have only a limited ability to evaluate.
      We may employ other personnel following a business combination regardless of whether our existing personnel remain with us. While we intend to closely scrutinize any additional individuals we engage after a business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be unfamiliar with the requirements of operating a public company as well as United States securities laws, which could cause us to have to expend time and resources helping them become familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory issues that may adversely affect our operations.
Our officers, directors and special advisors may allocate their time to other businesses, thereby causing conflicts of interests in their determination as to how much time to devote to our affairs. This may have a negative impact on our ability to consummate a business combination.
      Our officers, directors and special advisors are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time between our operations and other businesses. This could have a negative impact on our ability to consummate a business combination. We do not intend to have any full time employees prior to the consummation of a business combination. Each of our officers is engaged in several other business endeavors and are not obligated to contribute any specific number of hours per week to our affairs, although we expect Mr. Mukunda to devote an average of approximately fifteen hours per week to our business, for Mr. Cherin and Dr. Krishna to devote an average of approximately ten hours a week to our business and for Mr. Mukunda to devote substantially all of his time to our business during the process of conducting due diligence on a target company. For example, Mr. Mukunda, our Chief Executive Officer and President, serves as chairman and chief executive officer, and is a managing member for Integrated Global Networks, LLC and Global Starlink LLC, both privately-held telecommunications companies. If Messrs. Mukunda and Cherin’s and Dr. Krishna’s other business affairs require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability to devote time to our affairs and could have a negative impact on our ability to consummate a business combination. We cannot assure you that these conflicts will be resolved in our favor. For a complete discussion of the potential conflicts of interest that you should be aware of, see the section below entitled “Certain Relationships and Related Transactions.”

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Our officers, directors and special advisors are and may in the future become affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented.
      Our officers, directors and special advisors may in the future become affiliated with entities, including other “blank check” companies, engaged in business activities similar to those intended to be conducted by us. Additionally, our officers, directors and special advisors may become aware of business opportunities that may be appropriate for presentation to us as well as the other entities with which they are or may be affiliated. Our officers, directors and special advisors involved in businesses similar to what we may intend to conduct following a business combination may have fiduciary or contractual obligations to present opportunities to those entities first. We cannot assure you that any such conflicts will be resolved in our favor. For a complete discussion of our management’s business affiliations and the potential conflicts of interest that you should be aware of, see the sections below entitled “Management — Directors and Executive Officers” and “Certain Relationships and Related Transactions.”
Because all of our officers, directors and our special advisors own shares of our securities that will not participate in liquidation distributions, they may have a conflict of interest in determining whether a particular target business is appropriate for a business combination.
      All of our officers, directors and our special advisors own stock in our company, but have, with respect to those shares of common stock acquired by them prior to this offering, waived their right to receive distributions upon our liquidation in the event we fail to complete a business combination. Additionally, Mr. Mukunda has agreed with Ferris, Baker Watts, Inc. that he and certain of his affiliates, designees and assignees collectively will purchase, in the aggregate 170,000 units in a private placement that will occur immediately prior to this offering, but have waived their right to liquidation distributions with respect to the shares included in such units. Those shares and warrants owned by our officers, directors and our special advisors will be worthless if we do not consummate a business combination. The personal and financial interests of our officers and directors may influence their motivation in identifying and selecting target businesses and completing a business combination in a timely manner. Consequently, our officers’ and directors’ discretion in identifying and selecting suitable target businesses may result in a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate and in our stockholders’ best interest.
If our common stock becomes subject to the SEC’s penny stock rules, broker-dealers may experience difficulty in completing customer transactions and trading activity in our securities may be adversely affected.
      If at any time we have net tangible assets of $5,000,000 or less and our common stock has a market price per share of less than $5.00, transactions in our common stock may be subject to the “penny stock” rules promulgated under the Securities Exchange Act of 1934, as amended. Under these rules, broker-dealers who recommend such securities to persons other than institutional accredited investors must:
  •  make a special written suitability determination for the purchaser;
 
  •  receive the purchaser’s written agreement to a transaction prior to sale;
 
  •  provide the purchaser with risk disclosure documents that identify certain risks associated with investing in “penny stocks” and that describe the market for these “penny stocks” as well as a purchasers legal remedies; and
 
  •  obtain a signed and dated acknowledgment from the purchaser demonstrating that the purchaser has actually received the required risk disclosure document before a transaction in a “penny stock” can be completed.
      If our common stock becomes subject to these rules, broker-dealers may find it difficult to effect customer transactions and trading activity in our securities may be adversely affected. As a result, the market price of our securities may be depressed, and you may find it more difficult to sell our securities.

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It is probable that we will only be able to complete one business combination, which may cause us to be solely dependent on a single business and a limited number of products or services.
      The net proceeds from this offering and the private placement will provide us with approximately $55,441,200 (subject to reduction resulting from shareholders electing to convert their shares into cash), which we may use to complete a business combination. While we may seek to effect a business combination with more than one target business, our initial business acquisition must be with one or more operating businesses whose fair market value, collectively, is at least equal to 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of such acquisition. At the time of our initial business combination, we may not be able to acquire more than one target business because of various factors, including insufficient financing or the difficulties involved in consummating the contemporaneous acquisition of more than one operating company; therefore, it is probable that we will have the ability to complete a business combination with only a single operating business, which may have only a limited number of products or services. The resulting lack of diversification may:
  •  result in our dependency upon the performance of a single or small number of operating businesses;
 
  •  result in our dependency upon the development or market acceptance of a single or limited number of products, processes or services; and
 
  •  subject us to numerous economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent to a business combination.
      In this case, we will not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities that may have the resources to complete several business combinations in different industries or different areas of a single industry so as to diversify risks and offset losses. Further, the prospects for our success may be entirely dependent upon the future performance of the initial target business or businesses we acquire.
We will not generally be required to obtain a determination of the fair market value of a target business from an independent, unaffiliated third party.
      The initial target business or businesses with which we entered into a business combination must have a collective fair market value equal to at least 80% of our net assets at the time of such acquisition. The fair market value of such business generally will be determined by our board of directors based upon standards generally accepted by the financial community, such as actual and potential sales, earnings and cash flow and book value. We will obtain an opinion from an unaffiliated, independent investment banking firm that is a member of the National Association of Securities Dealers, Inc. with respect to the satisfaction of the 80% requirement only if our board is not able to independently determine that the target businesses have a sufficient fair market value or if a conflict of interest exists with respect to such determination, such as the target business being affiliated with one or more of our officers or directors. We will not be required to obtain an opinion from an investment banking firm as to the fair market value if our board of directors independently determines that the target business has sufficient fair market value or if no such conflict exists.
We have substantial discretion as to how to spend the proceeds in this offering which are outside of the trust.
      Our management has broad discretion as to how to spend the proceeds in this offering which are held outside of the trust account and may spend these proceeds in ways with which our stockholders may not agree. If we choose to invest some of the proceeds held outside of the trust account, we cannot predict that investment of the proceeds will yield a favorable return, if any.

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Because of our limited resources and the significant competition for business combination opportunities, we may not be able to consummate an attractive business combination.
      We expect to encounter intense competition from other entities having a business objective similar to ours, including venture capital funds, leveraged buyout funds and operating businesses competing for acquisitions. Many of these entities are well established and have extensive experience in identifying and effecting business combinations directly or through affiliates. Many of these competitors possess greater technical, human and other resources than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe that there are numerous potential target businesses that we could acquire with the net proceeds of this offering and the private placement, together with additional financing if available, our ability to compete in acquiring certain sizable target businesses will be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Further:
  •  our obligation to seek stockholder approval of a business combination may delay the consummation of a transaction;
 
  •  our obligation to convert into cash the shares of common stock in certain instances may reduce the resources available for a business combination; and
 
  •  our outstanding warrants and the purchase option granted to Ferris, Baker Watts, Inc., and the future dilution they potentially represent, may not be viewed favorably by certain target businesses.
      In addition, because our business combination may entail the contemporaneous acquisition of several operating businesses and may be with different sellers, we will need to convince such sellers to agree that the purchase of their businesses is contingent upon the simultaneous closings of the other acquisitions.
      Any of these obligations may place us at a competitive disadvantage in successfully negotiating a business combination.
Because there are numerous companies with a business plan similar to ours seeking to effectuate a business combination, it may be more difficult for us to do so.
      Since August 2003, based upon publicly available information, approximately 40 similarly structured blank check companies have completed initial public offerings. Of these companies, only four companies have consummated a business combination, while seven other companies have announced that they have entered into a definitive agreement for a business combination, but have not consummated such business combination. Accordingly, there are approximately 29 blank check companies with approximately $1.8 billion in trust that are seeking to carry out a business plan similar to our business plan. While, like us, some of those companies have specific industries that they must complete a business combination in, a number of them may consummate a business combination in any industry they choose. We may therefore be subject to competition from these and other companies seeking to consummate a business plan similar to ours, which will, as a result, increase demand for privately-held companies to combine with companies structured similarly to ours. Further, the fact that only two of such companies has completed a business combination and five of such companies have entered into a definitive agreement for a business combination may be an indication that there are only a limited number of attractive target businesses available to such entities or that many privately-held target businesses may not be inclined to enter into business combinations with publicly held blank check companies like us. We cannot assure you that we will be able to successfully compete for an attractive business combination. Additionally, because of this competition, we cannot assure you that we will be able to effectuate a business combination within the required time periods. If we are unable to find a suitable target business within such time periods, we will be forced to liquidate.

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We may be unable to obtain additional financing, if required, to complete a business combination or to fund the operations and growth of the target business, which could compel us to restructure or abandon a particular business combination.
      Although we believe that the net proceeds of this offering will be sufficient to allow us to consummate a business combination, in as much as we have not yet identified any prospective target businesses, we cannot ascertain the capital requirements for any particular business combination. If the net proceeds of this offering prove to be insufficient, either because of the size of the business combination or the depletion of the available net proceeds in search of target businesses, or because we become obligated to convert into cash a significant number of shares from dissenting stockholders, we will be required to seek additional financing through the issuance of equity or debt securities or other financing arrangements. We cannot assure you that such financing would be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed to consummate a particular business combination, we would be compelled to restructure or abandon that particular business combination and seek alternative target business candidates. In addition, if we consummate a business combination, we may require additional financing to fund the operations or growth of the target businesses. The failure to secure additional financing could have a material adverse effect on the continued development or growth of the target businesses. None of our officers, directors or stockholders is required to provide any financing to us in connection with or after a business combination.
Our existing stockholders, including our officers, directors and special advisors, control a substantial interest in us and thus may influence certain actions requiring stockholder vote.
      Upon consummation of our offering, our existing stockholders, including our officers, directors and special advisors, will collectively own approximately 21% of our issued and outstanding shares of common stock (including the purchase of 170,000 units in the private placement).
      In connection with the vote required for our initial business combination, all of our existing stockholders, including all of our officers, directors and special advisors, have agreed to vote the shares of common stock owned by them (whether purchased prior to, during or after the offering) in accordance with the majority of the shares of common stock voted by the public stockholders.
      Our board of directors is divided into three classes (Class A, Class B, and Class C), each of which will generally serve for a term of three years with only one class of directors being elected in each year. It is unlikely that there will be an annual meeting of stockholders to elect new directors prior to the consummation of a business combination, in which case all of the current directors will continue in office at least until the consummation of the business combination. If there is an annual meeting, as a consequence of our “staggered” board of directors, only a minority of the board of directors will be considered for election and our existing stockholders, because of their ownership position, will have considerable influence regarding the outcome. Accordingly, our existing stockholders will continue to exert control at least until the consummation of a business combination. In addition, our existing stockholders and their affiliates and relatives are not prohibited from purchasing units in this offering or shares in the aftermarket, and they will have full voting rights with respect to any shares of common stock they may acquire, either through this offering or in subsequent market transactions. If they do, we cannot assure you that our existing stockholders will not have considerable influence upon the vote in connection with a business combination.
  Our existing stockholders paid an aggregate of $25,000, or an average of approximately $.01 per share for their shares and, accordingly, you will experience immediate and substantial dilution from the purchase of our common stock.
      The difference between the public offering price per share of our common stock and the pro forma net tangible book value per share of our common stock after this offering and the private placement constitutes the dilution to you and the other investors in this offering. The fact that our existing stockholders acquired their shares of common stock at a nominal price has significantly contributed to this dilution. Assuming the offering and the private placement are completed, you and the other new investors will incur an immediate and

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substantial dilution of approximately 32% or $1.92 per share (the difference between the pro forma net tangible book value per share of $4.08 and the initial offering price of $6.00 per unit).
Our outstanding warrants may have an adverse effect on the market price of common stock and make it more difficult to effect a business combination.
      In connection with this offering and the private placement, as part of the units, we will be issuing warrants to purchase 20,000,000 shares of common stock (assuming no exercise of the underwriter’s over-allotment option). In addition, we have agreed to sell to Ferris, Baker Watts, Inc. an option to purchase up to a total of 500,000 units, which, if exercised, will result in the issuance of warrants to purchase an additional 1,000,000 shares of common stock. To the extent we issue shares of common stock to effect a business combination, the potential for the issuance of substantial numbers of additional shares upon exercise of these warrants could make us a less attractive acquisition vehicle in the eyes of a target business as such securities, when exercised, will increase the number of issued and outstanding shares of our common stock and reduce the value of the shares issued to complete the business combination. Accordingly, our warrants may make it more difficult to effectuate a business combination or increase the cost of a target business. Additionally, the sale, or even the possibility of sale, of the shares underlying the warrants could have an adverse effect on the market price for our securities or on our ability to obtain future public financing. If and to the extent these warrants are exercised, you may experience dilution to your holdings.
If our existing stockholders exercise their registration rights, it may have an adverse effect on the market price of our common stock and the existence of these rights may make it more difficult to effect a business combination.
      Our existing stockholders are entitled to demand that we register the resale of the 2,500,000 shares of common stock they acquired prior to this offering and the private placement in certain circumstances. Furthermore, they are entitled to demand the registration of the securities underlying the 170,000 units they are purchasing in the private placement at any time after we announce that we have entered a letter of intent, an agreement in principle or a definitive agreement in connection with a business combination. If our existing stockholders exercise their registration rights with respect to all of their shares of common stock, then there will be an additional 2,670,000 shares of common stock eligible for trading in the public market. The presence of this additional number of shares of common stock eligible for trading in the public market may have an adverse effect on the market price of our common stock. In addition, the existence of these rights may make it more difficult to effect a business combination or increase the cost of a target business, as the stockholders of a particular target business may be discouraged from entering into a business combination with us or will request a higher price for their securities as a result of these registration rights and the potential future effect their exercise may have on the trading market for our common stock.
The American Stock Exchange may delist our securities from quotation on its exchange which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions.
      Our securities will be listed on the American Stock Exchange, a national securities exchange, upon consummation of this offering. We cannot assure you that our securities will continue to be listed on the American Stock Exchange in the future prior to a business combination. Additionally, in connection with our business combination, it is likely that the American Stock Exchange may require us to file a new initial listing application and meet its initial listing requirements as opposed to its more lenient continued listing requirements. We cannot assure you that we will be able to meet those initial listing requirements at that time.

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      If the American Stock Exchange delists our securities from trading on its exchange, we could face significant material adverse consequences including:
  •  a limited availability of market quotations for our securities;
 
  •  a determination that our common stock is a “penny stock” which will require brokers trading in our common stock to adhere to more stringent rules and possibly resulting in a reduced level of trading activity in the secondary trading market for our common stock;
 
  •  a limited amount of news and analyst coverage for our company; and
 
  •  a decreased ability to issue additional securities or obtain additional financing in the future.
There is currently no market for our securities and a market for our securities may not develop, which could adversely affect the liquidity and price of our securities.
      There is no market for our securities. Therefore, stockholders should be aware that they cannot benefit from information about prior market history as to their decisions to invest which means they are at further risk if they invest. In addition, the price of the securities, after the offering, can vary due to general economic conditions and forecasts, our general business condition and the release of our financial reports.
      Furthermore, an active trading market for our securities may never develop or, if developed, it may not be maintained. Investors may be unable to sell their securities unless a market can be established or maintained.
If we are deemed to be an investment company, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete a business combination.
      If we are deemed to be an investment company under the Investment Company Act of 1940, as amended, our activities may be restricted, including:
  •  restrictions on the nature of our investments; and
 
  •  restrictions on the issuance of securities, each of which may make it difficult for us to complete a business combination.
      In addition, we may have imposed upon us burdensome requirements, including:
  •  registration as an investment company;
 
  •  adoption of a specific form of corporate structure; and
 
  •  reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations.
      We do not believe that our anticipated principal activities will subject us to the Investment Company Act of 1940. To this end, the proceeds held in trust may only be invested by the trust agent in “government securities” with specific maturity dates. By restricting the investment of the proceeds to these instruments, we intend to meet the requirements for the exemption provided in Rule 3a-1 promulgated under the Investment Company Act of 1940. If we were deemed to be subject to the act, compliance with these additional regulatory burdens would require additional expense that we have not allotted for.
Because we may be deemed to have no “independent” directors, actions taken and expenses incurred by our officers and directors on our behalf will generally not be subject to “independent” review.
      Each of our directors owns shares of our common stock and, although no salary or other compensation will be paid to them for services rendered prior to or in connection with a business combination, they may receive reimbursement for out-of -pocket expenses incurred by them in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. There is no limit on the amount of these out-of -pocket expenses and there will be no review of the reasonableness of the expenses by anyone other than our board of directors, which includes persons who may seek reimbursement, or a court of competent jurisdiction if such reimbursement is challenged. Because

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none of our directors may be deemed “independent,” we will generally not have the benefit of independent directors examining the propriety of expenses incurred on our behalf and subject to reimbursement. Although we believe that all actions taken by our directors on our behalf will be in our best interests, we cannot assure you that this will be the case. If actions are taken, or expenses are incurred that are not in our best interests, it could have a material adverse effect on our business and operations and the price of our stock held by the public stockholders.
Risks associated with companies with primary operations in India
Political, economic, social and other factors in India may adversely affect our ability to achieve our business objective which is to acquire one or more operating businesses with primary operations in India.
      Our ability to achieve our business objective may be adversely affected by political, economic, social and religious factors, changes in Indian law or regulations and the status of India’s relations with other countries. In addition, the economy of India may differ favorably or unfavorably from the U.S. economy in such respects as the rate of growth of gross domestic product, the rate of inflation, capital reinvestment, resource self-sufficiency and balance of payments position. According to the World Factbook published by the United States Central Intelligence Agency, the Indian government has exercised and continues to exercise significant influence over many aspects of the economy, and privatization of government-owned industries proceeds at a slow pace. Accordingly, Indian government actions in the future could have a significant effect on the Indian economy, which could have a material adverse affect on our ability to achieve our business objective.
      According to Mega Ace Consultancy, an India-based think tank studying the Indian economy, since mid-1991, the Indian government has committed itself to implementing an economic structural reform program with the objective of liberalizing India’s exchange and trade policies, reducing the fiscal deficit, controlling inflation, promoting a sound monetary policy, reforming the financial sector, and placing greater reliance on market mechanisms to direct economic activity. According to Mega Ace, a significant component of the program is the promotion of foreign investment in key areas of the economy and the further development of, and the relaxation of restrictions in, the private sector. These policies have been coupled with the express intention to redirect the government’s central planning function away from the allocation of resources and toward the issuance of indicative guidelines. While the government’s policies have resulted in improved economic performance, there can be no assurance that the economic recovery will be sustained. Moreover, there can be no assurance that these economic reforms will persist, and that any newly elected government will continue the program of economic liberalization of previous governments. Any change may adversely affect Indian laws and policies with respect to foreign investment and currency exchange. Such changes in economic policies could negatively affect the general business and economic conditions in India, which could in turn affect us and our ability to achieve our business objective.
      According to the World Factbook, religious and border disputes persist in India and remain pressing problems. For example, India has from time to time experienced civil unrest and hostilities with neighboring countries such as Pakistan. The longstanding dispute with Pakistan over the border Indian state of Jammu and Kashmir, a majority of whose population is Muslim, remains unresolved. If the Indian government is unable to control the violence and disruption associated with these tensions, the results could destabilize the economy and, consequently, adversely affect us and our ability to achieve our business objective.
      Since early 2003, there have also been military hostilities and civil unrest in Afghanistan, Iraq and other Asian countries. These events could adversely influence the Indian economy and, as a result, negatively affect us and our ability to achieve our business objective.
India has different corporate disclosure, governance and regulatory requirements than those in the United States which may make it more difficult or complex to consummate a business combination.
      Companies in India are subject to accounting, auditing, regulatory and financial standards and requirements that differ, in some cases significantly, from those applicable to public companies in the United States, which may make it more difficult or complex to consummate a business combination. In particular, the

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assets and profits appearing on the financial statements of an Indian company may not reflect its financial position or results of operations in the way they would be reflected had such financial statements been prepared in accordance with GAAP. There is substantially less publicly available information about Indian companies than there is about United States companies. Moreover, companies in India are not subject to the same degree of regulation as are United States companies with respect to such matters as insider trading rules, tender offer regulation, shareholder proxy requirements and the timely disclosure of information.
      Legal principles relating to corporate affairs and the validity of corporate procedures, directors’ fiduciary duties and liabilities and shareholders’ rights for Indian corporations may differ from those that may apply in the U.S., which may make the consummation of a business combination with an Indian company more difficult. We therefore may have more difficulty in achieving our business objective.
Foreign currency fluctuations could adversely affect our ability to achieve our business objective.
      Because our business objective is to acquire one or more operating businesses with primary operations in India, changes in the U.S. dollar – Indian rupee exchange rate may affect our ability to achieve such objective. The exchange rate between the Indian rupee and the U.S. dollar has changed substantially in the last two decades and may fluctuate substantially in the future. If the U.S. dollar declines in value against the Indian rupee, any business combination will be more expensive and therefore more difficult to complete. Furthermore, we may incur costs in connection with conversions between U.S. dollars and Indian rupees, which may make it more difficult to consummate a business combination.
Exchange controls that exist in India may limit our ability to utilize our cash flow effectively following a business combination.
      Following a business combination, we will be subject to India’s rules and regulations on currency conversion. In India, the Foreign Exchange Regulation Act or FERA, regulates the conversion of the Indian rupee into foreign currencies. FERA provisions previously imposed restrictions on locally incorporated companies with foreign equity holdings in excess of 40% known as FERA companies. Following a business combination, we will likely be a FERA company as a result of our ownership structure. However, comprehensive amendments have been made to FERA to add strength to the liberalizations announced in their recent economic policies. Such companies are now permitted to operate in India without any special restrictions, effectively placing them on par with wholly Indian owned companies. In addition, foreign exchange controls have been substantially relaxed. Notwithstanding, the Indian foreign exchange market is not yet fully developed and we cannot assure you that the Indian authorities will not revert back to regulating FERA companies and impose new restrictions on the convertibility of the Rupee. Any future restrictions on currency exchanges may limit our ability to use our cash flow for the distribution of dividends to our shareholders or to fund operations we may have outside of India.
Returns on investment in Indian companies may be decreased by withholding and other taxes.
      Our investments in India will incur tax risk unique to investment in India and in developing economies in general. Income that might otherwise not be subject to withholding of local income tax under normal international conventions may be subject to withholding of Indian income tax. This is especially true in the area of supply of technology and management support services to Indian companies which may be an area of interest to us. Under treaties with India and under local Indian income tax law income is generally sourced in India and subject to Indian tax if paid from India. This is true whether or not the services or the earning of the income would normally be considered as from sources outside India in other contexts. Additionally, proof of payment of withholding taxes may be required as part of the remittance procedure. Any withholding taxes paid by us on income from our investments in India may or may not be creditable on our income tax returns.
      We intend to avail ourselves of income tax treaties with India to seek to minimize any Indian withholding tax or local tax otherwise imposed. However, there is no assurance that the Indian tax authorities will recognize application of such treaties to achieve a minimization of Indian tax. We may also elect to create

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foreign subsidiaries to effect the business combinations to attempt to limit the potential tax consequences of a business combination.
Certain sectors of the Indian economy are subject to government regulations that limit foreign ownership, which may adversely affect our ability to achieve our business objective which is to acquire one or more operating businesses with primary operations in India.
      The Indian government prohibits investments in certain sectors and limits the ownership in certain other sectors. We intend to avoid sectors in which foreign investment is disallowed. This could limit the possible number of acquisitions that are available for investment. The Indian government also regulates investments in certain other sectors (e.g. banking) by increasing the amount of ownership over time. The management team will evaluate the risk associated with investments in sectors in which ownership is restricted. However, there can be no guarantee that management will be correct in its assessment of political and policy risk associated with investments in general and in particular in sectors that are regulated by the Indian government. Any changes in policy could have an adverse impact on our ability to achieve our business objective which is to acquire one or more operating businesses with primary operations in India.
      If the relevant Indian authorities find us or the target business with which we ultimately complete a business combination to be in violation of any existing or future Indian laws or regulations, they would have broad discretion in dealing with such a violation, including, without limitation:
  •  Levying fines;
 
  •  Revoking our business and other licenses; and
 
  •  Requiring that we restructure our ownership or operations.
The requirement that Indian companies provide accounting statements that are in compliance with U.S. Generally Accepted Accounting Principles (GAAP) may limit the potential number of acquisition targets.
      To meet the requirements of the United States Federal securities laws, in order to seek stockholder approval of a business combination, a proposed target business will be required to have certain financial statements which are prepared in accordance with, or which can be reconciled to GAAP and audited in accordance with U.S. Generally Accepted Auditing Standards (GAAS). GAAP and GAAS compliance may limit the potential number of acquisition targets.
If political relations between the U.S. and India weaken, it could make a target business’ operations less attractive.
      The relationship between the United States and India may deteriorate over time. Changes in political conditions in India and changes in the state of Indian-U.S. relations are difficult to predict and could adversely affect our future operations or cause potential target businesses to become less attractive. This could lead to a decline in our profitability. Any weakening of relations with India could have a material adverse effect on our operations after a successful completion of a business combination.
Because the Indian judiciary will determine the scope and enforcement under Indian law of almost all of our target business’ material agreements, we may be unable to enforce our rights inside and outside of India.
      Indian law will govern almost all of our target business’ material agreements, some of which may be with Indian governmental agencies. We cannot assure you that the target business or businesses will be able to enforce any of their material agreements or that remedies will be available outside of India. The inability to enforce or obtain a remedy under any of our future agreements may have a material adverse impact on our future operations.

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FORWARD-LOOKING STATEMENTS
      This prospectus contains forward-looking statements, including, among others, (a) our expectations about possible business combinations, (b) our growth strategies, (c) our future financing plans, and (d) our anticipated needs for working capital. Forward-looking statements, which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by use of the words “may,” “should,” “expect,” “anticipate,” “approximate,” “estimate,” “believe,” “intend,” “plan,” or “project,” or the negative of these words or other variations on these words or comparable terminology. This information may involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from the future results, performance, or achievements expressed or implied by any forward-looking statements. These statements may be found in this prospectus. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors, including, without limitation, the risks outlined under “Risk Factors” and matters described in this prospectus generally. In light of these risks and uncertainties, the events anticipated in the forward-looking statements may or may not occur. These statements are based on current expectations and speak only as of the date of such statements. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information or otherwise.
      The information contained in this prospectus identifies important factors that could adversely affect actual results and performance. Prospective investors are urged to carefully consider such factors.
      All forward-looking statements attributable to us are expressly qualified in their entirety by the foregoing cautionary statements.

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USE OF PROCEEDS
      We estimate that the net proceeds of this offering will be set forth in the following table:
                     
    Without Over-   With Over-
    Allotment Option   Allotment Option
         
Gross proceeds (1)
               
 
Offering
  $ 58,980,000     $ 67,827,000  
 
Private placement
    1,020,000       1,020,000  
   
Total
    60,000,000       68,847,000  
Offering expenses (2)
               
 
Underwriting discount (5% of offering)(3)
    2,949,000       3,391,350  
 
Underwriting non-accountable expense allowance (3% of offering without the over-allotment option)(3)
    1,769,400       1,769,400  
 
Legal fees and expenses (including blue sky services and expenses)
    515,000       515,000  
 
Miscellaneous expenses
    60,432       60,432  
 
Printing and engraving expenses
    120,000       120,000  
 
Accounting fees and expenses
    35,000       35,000  
 
SEC registration fee
    45,668       45,668  
 
NASD registration fee
    39,300       39,300  
 
Net proceeds
    54,466,200       62,870,850  
 
Contributions to escrow from founders loans and deferred payments(7)
    975,000       975,000  
             
 
Held in trust
  $ 55,441,200     $ 63,845,850  
             
                     
Working capital — funded from interest earned on amount held in trust (7)
               
 
Legal, accounting and other expenses attendant to the due diligence investigations, structuring and negotiation of a business combination(4)
    300,000       300,000  
 
Due diligence of prospective target businesses(4)
    185,000       185,000  
 
Legal and accounting fees relating to SEC reporting obligations
    115,000       115,000  
 
Administrative fees relating to office space ($4,000 per month for 24 months)
    96,000       96,000  
 
Working capital to cover travel, miscellaneous expenses, (including potential deposits, down payments or funding of a “no-shop” provision with respect to a prospective business combination) D&O insurance and reserves
    184,000       184,000  
 
Repayment of loans from founders and deferred payments(7)
    975,000       975,000  
             
   
Total (6)(7)
  $ 1,855,000     $ 1,855,000  
             
 
(1)  Excludes the payment of $100 from Ferris, Baker Watts, Inc. for its purchase option, proceeds from the sale of units under the purchase option and proceeds from the exercise of any warrants.
(2)  A portion of the offering expenses have been paid from the funds we received from Mr. Mukunda as described below. These funds will be repaid out of the proceeds of this offering not being placed in trust upon consummation of this offering.
(3)  Ferris, Baker Watts, Inc. has agreed to deposit the non-accountable expense allowance ($0.18 per Unit) into the trust account until the earlier of the completion of a business combination or the liquidation of the trust account. They have further agreed to forfeit any rights to or claims against such proceeds unless we successfully complete a business combination.
(4)  The $300,000 is expected to be paid to legal, accounting and other outside professionals to conduct due diligence once a potential target for a business combination is identified and to assist in negotiating and structuring the ultimate business transaction. The $185,000 represents costs expected to be incurred by the Company and its officers, directors and employees in identifying and reviewing potential targets for business combinations.
(6)  Excludes a financial advisory fee payable to Ferris, Baker Watts, Inc. equal to two percent (2%) of the consideration of any business combination by us up to a maximum fee of $1,500,000, a portion of which shall be allocated to SG Americas Securities, LLC.
(7)  The working capital of up to $1,855,000 will be funded from the interest earned from monies in escrow. In order to finance the working capital, at closing the founders will loan the company $720,000 and extend the pre-IPO loans of $150,000, for an aggregate amount of $870,000 to be used as working capital. Certain vendors have agreed to defer an aggregate of $105,000 of expenses. These will be repaid from the interest earned from the funds held in trust. The loans will be repaid with 4% interest from the interest earned from the funds held in trust. The loans and the vendor deferrals will not have any access or rights against the principal in escrow.

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     We intend to use the proceeds from the sale of the units to acquire one or more operating businesses with primary operations in India.
      $55,441,200, or $63,845,850 if the underwriters’ over-allotment option is exercised in full, of net proceeds of this offering and the private placement will be placed in a trust account at United Bank maintained by Continental Stock Transfer & Trust Company acting as trustee. Additionally, $1,769,400 of the proceeds attributable to the underwriters’ non-accountable expense allowance will be deposited in the trust account. The proceeds will not be released from the trust account until the earlier of the completion of a business combination or our liquidation. The proceeds held in the trust account may be used as consideration to pay the sellers of a target business with which we ultimately complete a business combination. Any amounts not paid as consideration to the sellers of the target business may be used to finance operations of the target businesses, other than amounts held in trust or paid to Ferris, Baker Watts, Inc. for its services as representative of the underwriters as financial advisor (including the $1,500,000 maximum financial advisory fee described above), amounts paid for finders’ or professional fees or amounts paid for any fees or costs incurred in connection with any debt or equity financing made in connection with the business combination. The Company does not currently have any agreement with any party with respect to the payment of finders’ or professional fees. If the Company agrees to pay such fees in the future, such fees shall be negotiated on an arms-length basis. While it is difficult to determine what the specific operating expenses of a target business may entail, we expect that they may include some or all of the following: capital expenditures, expenditures for future projects, general ongoing expenses including supplies and payroll, expanding markets and strategic acquisitions or alliances.
      We have agreed to pay Integrated Global Networks, LLC or IGN, LLC, an affiliate of Mr. Mukunda, a monthly fee of $4,000 for general and administrative services including office space, utilities and secretarial support. This arrangement is for our benefit and is not intended to provide Mr. Mukunda, the Chief Executive Officer of IGN, LLC and our Chairman, Chief Executive Officer and President, with compensation in lieu of salary. We believe, based on rents and fees for similar services in the Washington, DC metropolitan area, that the fee charged by IGN, LLC is at least as favorable as we could have obtained from an unaffiliated third party. However, because our directors may not be deemed “independent”, we did not have the benefit of disinterested directors approving the transaction.
      We intend to use the working capital (approximately $1,855,000) for repayment of founders loans, deferred expenses, director and officer liability insurance premiums, with the balance being held in reserve for other expenses such as, travel to India, due diligence, legal, accounting, and other expenses of structuring and negotiating business combinations, and deposits, down payments and/or funding of a “no shop” provision in connection with a business combination as well as for reimbursement of any out-of-pocket expenses incurred by our existing stockholders in connection with activities on our behalf as described below. We believe that the working capital will be sufficient to cover the foregoing expenses and reimbursement costs.
      We may not use all of the proceeds in the trust in connection with a business combination, either because the consideration for the business combination is less than the proceeds in trust or because we financed a portion of the consideration with our capital stock or debt securities. In that event, the proceeds held in the trust account as well as any other net proceeds not expended will be used to finance the operations of the target businesses, which may include subsequent acquisitions.
      Mr. Mukunda has loaned a total of $100,000 to us for the payment of offering expenses. Dr. Krishna has loaned a total of $50,000 to us for the payment of offering expenses. Upon the consummation of this offering, the founders will loan an additional $720,000 to us for working capital purposes. Each loan bears interest at a rate of 4% per year and will be payable on the earlier of the first anniversary of the consummation of this offering or the consummation of a business combination. Prior to the release of the escrowed funds to us each loan will be solely repaid out of the interest earned on the escrowed funds, provided that we will not be required to make any payments from such interest until we have withdrawn an aggregate of $1,855,000 from such interest for working capital purposes.
      The net proceeds of this offering (including that portion of the proceeds attributable to the underwriters’ discount and non-accountable expense allowance held in the trust account) that are not immediately required for the purposes set forth above will be invested only in United States “government securities,” defined as

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any Treasury Bill issued by the United States having a maturity of 180 days or less so that we are not deemed to be an investment company under the Investment Company Act of 1940. The interest income derived from investment of the net proceeds not held in trust during this period will be used to defray our general and administrative expenses, as well as costs relating to compliance with securities laws and regulations, including associated professional fees, until a business combination is completed.
      We believe that, upon consummation of this offering, we will have sufficient available funds to operate for at least the next 24 months, assuming that a business combination is not consummated during that time.
      We intend to allocate $185,000 of the interest paid on the trust proceeds for expenses incurred in examining and evaluating prospective target businesses. Mr. Mukunda will supervise this process and we expect that he will devote substantially all of his time to our business once we have signed a term sheet with a target business. We anticipate that Mr. Mukunda will be assisted in his efforts by the officers and advisors of the Company, together with the Company’s outside attorneys, accountants and other representatives. Other than IGN, LLC, we will not pay compensation of any kind (including finder’s and consulting fees) to the Company’s directors, officers, employees, stockholders or special advisors or their respective affiliates for services rendered to us prior to or in connection with the consummation of the business combination. However, our existing stockholders will receive reimbursement for any out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations. Since the role of present management after a business combination is uncertain, we have no ability to determine what remuneration, if any, will be paid to those persons after a business combination. However, other than the agreement with IGN, LLC described above, there are no current agreements or understandings with any of our existing stockholders or any of their respective affiliates with respect to the payment of compensation of any kind subsequent to a business combination. These reimbursements may be paid from the $185,000 allocated for due diligence.
      A public stockholder will be entitled to receive funds from the trust account (including interest earned on his, her or its portion of the trust account) only in the event of our liquidation upon our failure to complete a business combination or if that public stockholder were to seek to convert such shares into cash in connection with a business combination which the public stockholder voted against and which we actually consummate. In no other circumstances will a public stockholder have any right or interest of any kind to or in the trust account.
      Upon the consummation of a business combination, the underwriters will be entitled to receive that portion of the proceeds attributable to the underwriters’ discount and non-accountable expense allowance held in trust and any accrued interest thereon. In the event that we are unable to consummate a business combination and the trustee is forced to liquidate the trust account, the underwriters have agreed to the following: (i) forfeit any rights or claims to such proceeds and any accrued interest thereon; and (ii) that the proceeds attributable to the underwriters’ discount and non-accountable expense allowance will be distributed on a pro-rata basis among the public shareholders along with any accrued interest thereon.

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CAPITALIZATION
      The following table sets forth our capitalization at December 31, 2005 and as adjusted to give effect to the sale of our units and the application of the estimated net proceeds derived from the sale of our units:
                   
    December 31, 2005
     
    Actual   As Adjusted(1)
         
Notes payable to stockholders
  $ 150,000     $ 870,000  
             
Common Stock, $.0001 par value — 0 — and 1,999,000 shares which are subject to possible conversion, shares at conversion value
          11,634,180  
             
Stockholders’ equity
               
Preferred stock, $.0001 par value, 1,000,000 shares authorized; none issued and outstanding
           
Common stock, $.0001 par value, 75,000,000 shares authorized; 2,437,500 shares issued and outstanding, 12,437,500 shares issued and outstanding (including 1,999,000 shares which are subject to possible conversion), as adjusted
    244       1,244  
Additional paid-in capital
  $ 24,756       42,855,776  
Deficit accumulated during the development stage
  $ (30,519 )     (30,519 )
             
 
Total stockholders’ equity
  $ (5,519 )     42,826,501  
             
 
Total capitalization
  $ 144,481     $ 55,330,681  
             
 
(1)  Assumes full payment of the underwriters’ discount and expense allowance.
      If we consummate a business combination, the conversion rights afforded to our public stockholders may result in the conversion into cash of up to approximately 19.99% of the aggregate number of shares sold in this offering and the private placement at a per-share conversion price equal to the amount in the trust account, inclusive of any applicable net interest income thereon, as of the record date for determination of stockholders entitled to vote on a proposed business combination, divided by the number of shares sold in this offering and the private placement.

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DILUTION
      The difference between the public offering price per share of common stock, assuming no value is attributed to the warrants included in the units, and the pro forma net tangible book value per share of our common stock after this offering constitutes the dilution to investors in this offering. Net tangible book value per share is determined by dividing our net tangible book value, which is our total tangible assets less total liabilities (including the value of common stock that may be converted into cash), by the number of outstanding shares of our common stock.
      At December 31, 2005, our net tangible book value was a deficiency of approximately $762,218, or approximately $(0.31) per share of common stock. After giving effect to the sale of 10,000,000 shares of common stock included in the units sold in this offering and the private placement (but excluding shares underlying the warrants included in the units), and the deduction of underwriting discounts and estimated expenses of this offering, our pro forma net tangible book value (as decreased by the value of 1,999,000 shares of common stock which may be converted into cash) as of December 31, 2005 would have been approximately $42,826,501 or approximately $4.08 per share, representing an immediate increase in net tangible book value of $4.39 per share to the existing stockholders and an immediate dilution of $1.92 per share or approximately 32% to new investors not exercising their conversion rights.
      The following table illustrates, the dilution to the new investors on a per-share basis, assuming no value is attributed to the warrants included in the units:
                   
Public offering price
          $ 6.00  
 
Net tangible book value before this offering
  $ (.31 )        
 
Increase attributable to new investors
    4.39          
             
Pro forma net tangible book value after this offering
            4.08  
             
Dilution to new investors
          $ 1.92  
             
      Our pro forma net tangible book value after this offering has been reduced by approximately $11,634,180 because if we effect a business combination, the conversion rights to the public stockholders may result in the conversion into cash of up to approximately 19.99% of the aggregate number of the shares sold in this offering and the private placement at a per-share conversion price equal to the amount in the trust account calculated as of the record date for determination of stockholders entitled to vote on a proposed business consummation, inclusive of any interest, divided by the number of shares sold in this offering.
      The following table sets forth information with respect to our existing stockholders prior to and after the private placement and the new investors:
                                           
    Shares Purchased   Total Consideration    
            Average Price
    Number   Percentage   Amount   Percentage   per Share
                     
Existing stockholders
    2,500,000       20.00 %   $ 25,000       .04 %   $ .01  
Private placement
    170,000       1.36 %   $ 1,020,000       1.70 %     6.00  
New investors
    9,830,000       78.64 %   $ 58,980,000       98.26 %     6.00  
                               
 
Total
    12,500,000       100.00 %   $ 60,025,000       100.00 %        
                               

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      Our pro forma net tangible book value after this offering and the private placement is calculated as follows:
           
Numerator:
       
 
Net tangible book value before this offering and the private placement
  $ (762,218 )
 
Proceeds from this offering and the private placement
    54,466,200  
 
Offering costs excluded from net tangible book value before this offering and the private placement
    756,699  
 
Less: Proceeds held in trust subject to conversion
to cash
    (11,634,180 )
       
    $ 42,826,501  
       
Denominator:
       
 
Shares of common stock outstanding prior to this offering and the private placement
    2,500,000  
 
Shares of common stock included in the units offered, including the private placement
    10,000,000  
 
Less: Shares subject to conversion (10,000,000 × 19.99%)
    (1,999,000 )
       
      10,501,000  
       
      The preceding calculations assume the payment in full of the underwriters discount and expense allowance.

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MANAGEMENT’S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
      We were formed on April 29, 2005, as a blank check company for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition or other similar business combination, one or more businesses in an unspecified industry, with operations primarily in India. We do not have any specific merger, capital stock exchange, asset acquisition or other similar business combination under consideration and have not had any discussions, formal or otherwise, with respect to such a transaction. We intend to use cash derived from the proceeds of this offering, our capital stock, debt or a combination of cash, capital stock and debt, to effect a business combination.
      The issuance of additional capital stock, including upon conversion of any convertible debt securities we may issue, or the incurrence of debt could have material consequences on our business and financial condition. The issuance of additional shares of our capital stock (including upon conversion of convertible debt securities):
  •  may significantly reduce the equity interest of our stockholders;
 
  •  will likely cause a change in control if a substantial number of our shares of common stock or voting preferred stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and may also result in the resignation or removal of one or more of our present officers and directors;
 
  •  may adversely affect the voting power or other rights of holders of our common stock if we issue preferred stock with dividend, liquidation, conversion or other rights superior to the common stock; and
 
  •  may adversely affect prevailing market prices for our common stock, warrants or units.
Similarly, the incurrence of debt:
  •  may lead to default and foreclosure on our assets if our operating revenues after a business combination are insufficient to pay our debt obligations;
 
  •  may cause an acceleration of our obligations to repay the debt even if we make all principal and interest payments when due if we breach the covenants contained in the terms of the debt documents, such as covenants that require the maintenance of certain financial ratios or reserves, without a waiver or renegotiation of such covenants;
 
  •  may create an obligation to immediately repay all principal and accrued interest, if any, upon demand to the extent any debt securities are payable on demand; and
 
  •  may hinder our ability to obtain additional financing, if necessary, to the extent any debt securities contain covenants restricting our ability to obtain additional financing while such security is outstanding, or to the extent our existing leverage discourages other potential investors.
      To date, our efforts have been limited to organizational activities. We have neither engaged in any operations nor generated any revenues to date.
      We estimate that the net proceeds from the sale of the units in the offering and the private placement and the loans from founders and the deferred costs will be $55,441,200 (or $63,845,850 if the underwriters’ over-allotment is exercised in full), after deducting offering expenses of approximately $815,400 and underwriting discounts of approximately $4,718,400 (or $5,160,750 if the underwriters’ over-allotment option is exercised in full), including $1,769,400 evidencing the underwriters’ non-accountable expense allowance of 3% of the

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gross proceeds. All of this amount will be held in trust. Additionally, $1,769,400 or of the proceeds attributable to the underwriters’ non-accountable expense allowance will be deposited in the trust account. We will use substantially all of the net proceeds of this offering to acquire one or more operating businesses, including identifying and evaluating prospective acquisition candidates, selecting one or more operating businesses, and structuring, negotiating and consummating the business combination. However, we may not use all of the proceeds in the trust in connection with a business combination, either because the consideration for the business combination is less than the proceeds in trust, because we finance a portion of the consideration with our capital stock or debt securities or because certain fees and expenses held in the trust account are due to Ferris, Baker Watts, Inc. In that event, other than the fees and expenses due to Ferris, Baker Watts, the proceeds held in the trust account as well as any other net proceeds not expended will be used to finance the operations of the target business or businesses.
      In the event that we consummate a business combination, the proceeds held in the trust account will be used for the following purposes:
  •  Payment of the purchase price for the business combination;
 
  •  Payment of the fees and costs due to Ferris, Baker Watts, Inc. as representative of the underwriters and financial advisor to the company;
 
  •  Payment of any finder’s fees or professional fees and costs; and
 
  •  Payment of any fees and costs the Company may incur in connection with any equity or debt financing relating to the business combination.
 
  •  In addition, the Company will repay the outstanding balance of the aggregate $870,000 in loans made by Mr. Mukunda and Dr. Krishna to the Company and any deferred expenses.
      The Company does not currently have any agreement with any party with respect to the payment of finders’ or professional fees. If the Company agrees to pay such fees in the future, such fees shall be negotiated on an arms-length basis.
      We believe that, upon consummation of this offering, the funds available to us outside of the trust account will be sufficient to allow us to operate for at least the next 24 months, assuming that a business combination is not consummated during that time. Over this time period, we anticipate making the following expenditures:
  •  approximately $300,000 of expenses for legal, accounting and other expenses attendant to the due diligence investigations, structuring and negotiating of a business combination;
 
  •  Approximately $185,000 of expenses for the due diligence and investigation of a target business;
 
  •  approximately $115,000 of expenses in legal and accounting fees relating to our SEC reporting obligations;
 
  •  approximately $96,000 of expenses in fees relating to our office space and certain general and administrative services; and

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  •  approximately $184,000 for travel, general working capital that will be used for miscellaneous expenses and reserves, including for director and officer liability insurance premiums, deposits, down payments and/or funding of a “no shop” provision in connection with a prospective business transaction and for international travel with respect to negotiating and finalizing a business combination.
      We do not believe we will need additional financing following this offering in order to meet the expenditures required for operating our business. However, we may need to obtain additional financing to the extent such financing is required to consummate a business combination, in which case we may issue additional securities or incur debt in connection with such business combination.
      As of May 2, 2005, Mr. Mukunda loaned a total of $100,000 to us for payment of offering expenses, as of September 15, 2005, Dr. Krishna loaned a total of $50,000 to us for payment of offering expenses. Upon the consummation of this offering, the founders will loan an additional $720,000 to us for working capital purposes. The loans bear interest at a rate of 4% per year and will be payable on the earlier of April 30, 2006 or the first anniversary of the consummation of this offering or the consummation of a business combination. Prior to the consummation of a business combination, the loans will be solely repaid out of the interest earned on the escrowed funds, provided that we will not be required to make any payments from such interest until we have withdrawn an aggregate of $1,855,000 from such interest for working capital purposes.
      We have agreed to pay IGN, LLC, an affiliate of Mr. Mukunda, a monthly fee of $4,000 for general and administrative services including office space, utilities and secretarial support. This arrangement is for our benefit and is not intended to provide Mr. Mukunda, Chief Executive Officer of IGN, LLC and our Chairman, Chief Executive Officer and President, with compensation in lieu of salary. We believe, based on rents and fees for similar services in the Washington, DC metropolitan area, that the fee charged by IGN, LLC is at least as favorable as we could have obtained from an unaffiliated third party. However, because our directors may not be deemed “independent”, we did not have the benefit of disinterested directors approving the transaction.

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PROPOSED BUSINESS
Introduction
      We are a recently organized Maryland blank check company formed on April 29, 2005 for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition or other similar business combination or acquisition, one or more businesses with operations primarily in India. To date, our efforts have been limited to organizational activities.
      Country Focus: We intend to focus on finding opportunities with operations in India. We believe that India presents opportunities to acquire target businesses that have not previously been available because it has become one of the world’s largest democracies, and in recent years, has undergone significant deregulation of certain sectors of its economy. According to the 2001 World Factbook published by the U.S. Central Intelligence Agency, India’s economy, in terms of gross domestic product (GDP), the total value of goods and services produced in India, as measured by purchasing power parity (PPP), the relative value of a nation’s currency based on what the currency can buy in the country of origin, is the fourth largest in the world just behind Japan and ahead of Germany. The Indian economy is also currently transitioning from traditional farming and handicrafts to modern agriculture, modernized industries and services. Some basic facts relating to India as set forth in the 2001 World Factbook are:
  •  India is the world’s second most populous country. The population of India is approximately 1.1 billion, with a total labor force of about 482 million (2004 estimate).
 
  •  Inflation is approximately 4.2% (2004 estimate).
 
  •  India’s exports are approximately $69.18 billion on a free on board basis (f.o.b.) (2004 estimate).
 
  •  India’s top five export partners as of the end of 2003 are the following:
        (1) United States (approximately 20.3%);
 
        (2) China (approximately 6.3%);
 
        (3) United Kingdom (approximately 5.2%);
 
        (4) Hong Kong (approximately 4.7%); and
 
        (5) Germany (approximately 4.3%).
  •  India’s reserves of foreign exchange and gold are approximately $126 billion (2004 estimate).
 
  •  The Indian currency is the rupee and over the past three years on average US $1.00 was equivalent to:
  •  45.8692 Indian rupees in 2004,
 
  •  46.5806 Indian rupees in 2003, and
 
  •  48.6103 Indian rupees in 2002.
Determinate Factors for Acquisition Opportunities
      We believe that there is an opportunity to buy a business in India at an attractive valuation, which may lead to exceptional potential growth opportunity. There are two significant macro economic factors that we believe drive this opportunity:
      Rapidly Growing Economy:      According to the World Factbook, India has posted a growth rate of 6.8% since 1994 and has become the fourth largest economy in the world behind Japan in terms of PPP. However, the Japanese economy with a GDP of approximately $3.745 trillion is growing at a rate of approximately 2.9% compared to the Indian economy which is growing at a rate of approximately 6.2% and has a GDP of

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approximately $3.319 trillion. Below is a table illustrating GDP, as measured in terms of PPP, of the top eight economies and their growth rates.
                 
    GDP as measured    
    in terms of PPP   Growth rate
    (2004 estimate)   (2004 estimate)
         
U.S. 
  $ 11.75 trillion       4.4 %
China
  $ 7.262 trillion       9.1 %
Japan
  $ 3.745 trillion       2.9 %
India
  $ 3.319 trillion       6.2 %
Germany
  $ 2.362 trillion       1.7 %
U.K. 
  $ 1.782 trillion       3.2 %
France
  $ 1.737 trillion       2.1 %
Italy
  $ 1.609 trillion       1.3 %
 
Source: World Factbook published by the United States Central Intelligence Agency in 2004.
      A commitment to stability and economic reforms. According to Mega Ace Consultancy, an India-based think tank studying the Indian economy, since mid-1991, the Indian government has committed itself to implementing an economic structural reform program with the objective of liberalizing India’s exchange and trade policies, reducing the fiscal deficit, controlling inflation, promoting a sound monetary policy, reforming the financial sector, and placing greater reliance on market mechanisms to direct economic activity. Mega Ace’s principals include a former economic advisor to the Central Bank — Reserve Bank of India and a former CEO of the Bombay Stock Exchange. Mega Ace’s projects include serving as chief consultant to an agency looking to promote investment in France among Indian investors and serving as a south-Asian consultant to a project devoted to forming links between small and medium sized enterprises in the UK and Europe with companies based in South Asia. According to Mega Ace Consultancy, a significant component of the program is the promotion of foreign investment in key areas of the economy and the further development of, and the relaxation of restrictions in, the private sector. As a result, we believe the regulatory environment has become more favorable. There are already a number of industry sectors that have been deregulated, including, but not limited to, telecommunications, drug and pharmaceuticals, banking and insurance, airports and airlines and mining and petroleum whereby foreign investors may own and control Indian companies and profits may be reinvested in India or repatriated to the U.S. or to other foreign countries.
Identification of Industry Sectors
      While we are not limited to the sectors outlined below, we believe that there are two broad areas: (1) Business Process Outsourcing and Information Technology and (2) Infrastructure, that are illustrative of the opportunities that we may consider. We believe that some industry sectors are fragmented and present a greater opportunity for a capitalized entity to consolidate a number of the best middle tier companies in India. Our strategy in each of these sectors (as well as others we may consider) is to identify potential “market sector leaders” which we think will grow at a substantially faster rate than the overall economy. The two broad illustrative areas are as follows:
  Business Process Outsourcing and Information Technology: Business Process Outsourcing or BPO typically refers to the act of transferring business processes to an outside provider in order to achieve cost savings while improving service quality. BPO extends beyond typical information technology outsourcing. A BPO service provider may take on a specific corporate function like customer service and/or help desk, or more complex and knowledge-based functions, such as human resources, accounting and finance, research and development, and monitoring of networks. A BPO service provider may also assume the responsibility for re-engineering and introducing best practices into processes that are outsourced. In this way, BPO is fast emerging as not just a cost saving mechanism, but a powerful strategic management tool in achieving business objectives. We believe that India has a well educated, English speaking middle class and a low wage base that will

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  allow the BPO and Information Technology businesses to continue to grow. Within the BPO and Information Technology sector, we believe there are several compelling industries to explore, including, but not limited to:

  •  Knowledge-based and Other Back Office Outsourcing : As labor costs for information technology and similar professionals soar in the U.S. and technology facilitates communication between persons in disparate parts of the world, we believe that the benefits of out-sourcing knowledge-based and back office functions to countries such as India, will be increasingly utilized by businesses all over the world. We may consider sectors, such as software development, research and development, information technology, telecommunications outsourcing, financial services, and customer care.
 
  •  Pharmaceutical and Health Services : As healthcare costs soar in the U.S., we believe that the benefits of outsourcing medical care, drug manufacturing or medical transcription to countries such as India, will be increasingly utilized in the healthcare industry and by consumers all over the world. For example, medical transcription (where medical dictation is converted by workers in India into print) is an area that has taken advantage of the lower labor rates in India and other countries. Other areas that are expected to benefit from outsourcing are generic drug manufacturing, drug trial testing, and telemedicine. For example, we might consider buying a middle tier generic drug manufacturer with a U.S. Federal Drug Administration approved manufacturing plant and combining it with a distributor in the U.S. to create a vertical generic drug manufacturing and distribution company.
        Infrastructure: We believe that because of rapid economic growth there is a substantial demand for ongoing infrastructure improvements to support continued growth. We further believe that the rapid economic growth has created a growing middle class that has developed increasing buying power. As a result of these factors, we further believe there has been an increased growth opportunity for companies that develop and build infrastructure. Some middle tier infrastructure acquisition opportunities would include, among others, companies that build business complexes, residential housing and shopping complexes. We would also consider transportation companies, logistics companies or financial services companies operating within India as prospective middle tier infrastructure acquisition target businesses.
      While we may seek to effect a business combination with more than one target business, our initial business acquisition must be with one or more operating businesses whose fair market value, collectively, is at least equal to 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of such acquisition. Consequently, if we cannot identify and acquire multiple operating businesses contemporaneously, we will need to identify and acquire a larger single operating business or a small number of similarly focused operating businesses.
      We do not have any specific merger, capital stock exchange, asset acquisition or other similar business combination under consideration and have not had any discussions, formal or otherwise, with respect to such a transaction.
Effecting a business combination
      General To date, we have not selected any target business for a business combination. Moreover, neither we nor any of our affiliates, agents or representatives has had any contact or discussions, directly or indirectly, with representatives of any other company regarding a potential business combination with such company nor have we, nor any of our affiliates, agents or representatives, been approached, directly or indirectly, by any potential candidates (or representatives of any potential candidates) with respect to such a transaction or by any unaffiliated party with respect to a potential candidate or a potential transaction with such a candidate. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable candidate for a proposed business combination with us other than Ferris, Baker Watts,

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Inc. and SG Americas Securities, LLC with whom we have entered into the advisory agreement described below.
      We are not presently engaged in, and we will not engage in, any substantive commercial business for an indefinite period of time following this offering. We intend to use cash derived from the proceeds of this offering, our capital stock, debt or a combination of these to effect a business combination involving one or more operating businesses in India, in an unspecified industry. Although substantially all of the net proceeds of this offering are intended to be generally applied toward effecting a business combination as described in this prospectus, the proceeds are not otherwise being designated for any more specific purposes. Accordingly, prospective investors will invest in us without an opportunity to evaluate the specific merits or risks of any one or more business combinations. A business combination may involve the acquisition of, or merger with, one or more operating businesses that do not need substantial additional capital but desire to establish a public trading market for their shares, while avoiding what they may deem to be adverse consequences of undertaking a public offering itself. We believe these include certain time delays, significant expense, loss of voting control and compliance with various federal and state securities laws. In the alternative, a business combination may involve one or more companies that may be financially unstable or in their early stages of development or growth.
     We have not identified any target business
      To date, we have not selected any target businesses. Subject to the requirement that our initial business combination must be with one or more operating businesses that, collectively, have a fair market value of at least 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of the acquisition, we will have limited, if any, restrictions on our ability to identify and select prospective acquisition candidates. Accordingly, there is no basis for investors in this offering to evaluate the possible merits or risks of the particular industry in which we may ultimately operate or the target businesses with which we may ultimately complete a business combination. To the extent we effect a business combination with a financially unstable company or an entity in its early stage of development or growth, including entities without established records of sales or earnings; we may be affected by numerous risks inherent in the business and operations of financially unstable and early stage or potential emerging growth companies. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors.
     Sources of target businesses
      We anticipate that acquisition candidates will be primarily derived from three possible sources: (1) the professional community, including, without limitation, investment bankers, attorneys and accountants, (2) quasi-governmental associations such as the International Finance Corporation, which is a member of the World Bank, and (3) the deregulation of industries by the government of India. In addition, we may receive acquisition candidates from other unaffiliated sources, including private equity and venture capital funds and public and private companies. Our officers, directors and special advisors and their affiliates may also bring to our attention acquisition candidates. In addition to contacting the sources described above for potential acquisition candidates, we expect that we may be contacted by unsolicited parties who become aware of our interest in prospective targets through press releases, word of mouth, media coverage and our website, should these outlets develop. We may pay a finder’s fee to any unaffiliated party that provides information regarding prospective targets to us. Any such fee would be conditioned on our consummating a business combination with the identified target. We anticipate that such fees, if any, like the Ferris, Baker Watts Inc. and SG Securities Americas, LLC fee described below, would be a percentage of the consideration associated with such business combination, with the percentage to be determined based on local market conditions at the time of such combination.
      We have also entered into a financial advisory agreement with Ferris, Baker Watts, Inc., the representative of the underwriters in this offering, and SG Securities Americas, LLC, one of the participating underwriters in this offering, whereby Ferris, Baker Watts, Inc. and SG Securities Americas, LLC will serve as our exclusive financial advisors in connection with a business combination for a period of two years from the effective date of this offering. Ferris, Baker Watts, Inc. and SG Securities Americas, LLC will perform

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certain advisory services for us, including without limitation, assisting us in determining an appropriate acquisition strategy and tactics, evaluating the consideration that may be offered to a target business, assisting us in the negotiation of the financial terms and conditions of a business combination and preparing a due diligence package regarding a business combination for our board of directors. The due diligence services to be provided by Ferris, Baker Watts, Inc. and SG Americas Securities, LLC will consist of gathering, preparing and organizing information to be considered by our board of directors, among other things, once a target for a business combination has been identified. Pursuant to the terms of this agreement, Ferris, Baker Watts, Inc., will be entitled to receive two percent (2%) of the consideration associated with any business combination by us, a portion of which shall be allocated to SG Americas Securities, LLC pursuant to a separate agreement between the parties. The fee will be capped at $1,500,000 and will be paid out of the trust proceeds only upon consummation of a suitable business combination. In addition to the foregoing fee, we have agreed to reimburse Ferris, Baker Watts, Inc. and SG Americas Securities, LLC, promptly, on a monthly basis, for all of the reasonable out-of-pocket expenses incurred by Ferris, Baker Watts, Inc. and SG Americas Securities, LLC, whether or not a business combination is consummated; provided, however, that such expenses in the aggregate will not exceed $25,000 without our prior consent.
      Other than our advisory agreement with Ferris, Baker Watts, Inc. and SG Americas Securities, LLC, we do not presently anticipate engaging the services of professional firms that specialize in business acquisitions on any formal basis. Notwithstanding the foregoing, we may engage these firms in the future, in which event we may pay a finder’s fee or other compensation. In no event, however, will we pay any of our existing officers, directors, stockholders or any entity with which they are affiliated (other than IGN, LLC) any finder’s fee or other compensation for services rendered to us prior to or in connection with the consummation of a business combination.
     Selection of target businesses and structuring of a business combination
      Mr. Mukunda will supervise the process of evaluating prospective target businesses, and we expect that he will devote substantially all of his time to our business once we have signed a term sheet with a target business. We anticipate that Mr. Mukunda will be assisted in his efforts by officers and advisors of the Company, together with the Company’s outside attorneys, accountants and other representatives. As described above, under their advisory agreement with us, Ferris, Baker Watts, Inc. and SG Americas Securities, LLC may also assist in this process, including the preparation of due diligence packages for management’s review.
      Subject to the requirement that our initial business combination must be with one or more operating businesses that, collectively, have a fair market value of at least 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of such acquisition, our management will have limited, if any, restrictions on our ability to identify and select prospective target businesses. In evaluating prospective target businesses, our management will likely consider, among other factors, the following:
  •  financial condition, results of operation and repatriation regulations;
 
  •  growth potential both in India and growth potential outside of India;
 
  •  capital requirements;
 
  •  experience and skill of management and availability of additional personnel;
 
  •  competitive position;
 
  •  barriers to entry into the businesses’ industries;
 
  •  potential for compliance with GAAP, SEC regulations, Sarbanes-Oxley requirements and capital requirements;
 
  •  domestic and global competitive position and potential to compete in the U.S. and other markets;
 
  •  position within a sector and barriers to entry;

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  •  stage of development of the products, processes or services;
 
  •  degree of current or potential market acceptance of the products, processes or services;
 
  •  proprietary features and degree of intellectual property or other protection of the products, processes or services;
 
  •  regulatory environment of the industry and the Indian government’s policy towards the sector; and
 
  •  costs associated with effecting the business combination.
      These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular business combination with one or more operating businesses will be based, to the extent relevant, on the above factors as well as other considerations deemed relevant by our management in effecting a business combination consistent with our business objective. In evaluating prospective target businesses, we intend to conduct an extensive due diligence review that will encompass, among other things, meetings with incumbent management and inspection of facilities, as well as review of financial and other information that will be made available to us.
      We will endeavor to structure a business combination so as to achieve the most favorable tax treatment to the target businesses, their stockholders, as well as our own stockholders and us. We cannot assure you, however, that the Internal Revenue Service or appropriate state tax or foreign tax authority will agree with our tax treatment of the business combination.
      The time and costs required to select and evaluate target businesses and to structure and complete the business combination cannot presently be ascertained with any degree of certainty. Any costs incurred with respect to the identification and evaluation of prospective target businesses with which a business combination is not ultimately completed will result in a loss to us and reduce the amount of capital available to otherwise complete a business combination. However, other than IGN, LLC, we will not, and no other person or entity will, pay any finders or consulting fees to our existing directors, officers, stockholders or special advisors, or any of their respective affiliates, for services rendered to or in connection with a business combination. In addition, we will not make any other payment to them out of the proceeds of this offering (or the funds held in trust) other than reimbursement for any out-of-pocket expenses they incur in conducting due diligence, the payments to IGN, LLC for administrative services and the repayment of an aggregate of $870,000 in loans issued by Mr. Mukunda and Dr. Krishna to us.
     Fair market value of target businesses
      The initial target businesses that we acquire must have a fair market value equal to at least 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of such acquisition, although we may acquire a target business whose fair market value significantly exceeds 80% of our net assets. To this end, we may seek to raise additional funds through the sale of our securities or through loan arrangements if additional funds are required to consummate such a business combination, although we have not engaged or retained, had any discussions with, or entered into any agreements with, any third party regarding any such potential financing transactions. If we were to seek additional funds, any such arrangement would only be consummated simultaneously with our consummation of a business combination. The fair market value of such businesses will be determined by our board of directors based upon standards generally accepted by the financial community, such as actual and potential sales, earnings and cash flow and book value. If our board is not able to independently determine that the target businesses have a sufficient fair market value or if a conflict of interest exists with respect to such determination, including, but not limited to the fact that the target is affiliated with one or more of our officers or directors, we will obtain an opinion from an unaffiliated, independent investment banking firm which is a member of the NASD with respect to the satisfaction of such criteria. However, we will not be required to obtain an opinion from an investment banking firm as to the fair market value if our board of directors independently determines that the target businesses have sufficient fair market value or if no such conflict exists.

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     Possible lack of business diversification
      The net proceeds from this offering and the private placement will provide us with approximately $55,441,200 (subject to reduction resulting from shareholders electing to convert their shares into cash), which we may use to complete a business combination. While we may seek to effect a business combination with more than one target business, our initial business acquisition must be with one or more operating businesses whose fair market value, collectively, is at least equal to 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of such acquisition. At the time of our initial business combination, we may not be able to acquire more than one target business because of various factors, including insufficient financing or the difficulties involved in consummating the contemporaneous acquisition of more than one operating company, including, but not limited to, the potential lack of resources to simultaneously conduct due diligence reviews and to negotiate acquisition terms with multiple targets; therefore, it is probable that we will have the ability to complete a business combination with only a single operating business, which may have only a limited number of products or services. The resulting lack of diversification may:
  •  result in our dependency upon the performance of a single or small number of operating businesses;
 
  •  result in our dependency upon the development or market acceptance of a single or limited number of products, processes or services; and
 
  •  subject us to numerous economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent to a business combination.
      In this case, we will not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities that may have the resources to complete several business combinations in different industries or different areas of a single industry so as to diversify risks and offset losses. Further, the prospects for our success may be entirely dependent upon the future performance of the initial target business or businesses we acquire.
      In addition, since our business combination may entail the contemporaneous acquisition of several operating businesses at the same time and may be with different sellers, we will need to convince such sellers to agree that the purchase of their businesses is contingent upon the simultaneous closings of the other acquisitions.
     Limited ability to evaluate the target business’ management
      Although we intend to closely scrutinize the management of prospective target businesses when evaluating the desirability of effecting a business combination, we cannot assure you that our assessment of the target business’ management will prove to be correct. In addition, we cannot assure you that the future management will have the necessary skills, qualifications or abilities to manage a public company intending to embark on a program of business development. Furthermore, the future role of our officers, directors and special advisors, if any, in the target businesses cannot presently be stated with any certainty. While it is possible that one or more of our officers, directors and special advisors will remain associated with us in some capacity following a business combination, it is unlikely that any of them will devote their full efforts to our affairs subsequent to a business combination. Moreover, we cannot assure you that our officers, directors and special advisors will have significant experience or knowledge relating to the operations of the particular target businesses acquired.
      Following a business combination, we may seek to recruit additional managers to supplement the incumbent management of the target businesses. We cannot assure you that we will have the ability to recruit additional managers, or that additional managers will have the requisite skills, knowledge or experience necessary to enhance the incumbent management.

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     Opportunity for stockholder approval of business combination
      Prior to the completion of a business combination, we will submit the transaction to our stockholders for approval, even if the nature of the acquisition is such as would not ordinarily require stockholder approval under applicable state law. In connection with seeking stockholder approval of a business combination, we will furnish our stockholders with proxy solicitation materials prepared in accordance with the Securities Exchange Act of 1934, which, among other matters, will include a description of the operations of the target business and certain required financial information regarding the business.
      In connection with the vote required for our initial business combination, all of our existing stockholders, including all of our officers, directors, and our special advisors, have agreed to vote the shares of common stock owned by them in accordance with the majority of the shares of common stock voted by the public stockholders other than our existing stockholders. Accordingly, they will not be entitled to exercise the conversion rights described below for public stockholders who vote against a business combination. We will proceed with the business combination only if a majority of the shares of common stock voted by the public stockholders are voted in favor of the business combination and public stockholders owning less than 19.99% of the shares sold in this offering and the private placement exercise their conversion rights.
     Conversion rights
      At the time we seek stockholder approval of any business combination, we will offer each public stockholder the right to have such stockholder’s shares of common stock converted to cash if the stockholder votes against the business combination and the business combination is approved and completed. The actual per-share conversion price will be equal to the amount in the trust account, inclusive of any interest (calculated as of the record date for determination of stockholders entitled to vote on a proposed business combination), divided by the number of shares sold in this offering. Without taking into account any interest earned on the trust account, the initial per-share conversion price would be approximately $5.82 (or approximately $.18 less than the per-unit offering price of $6.00).We will take steps to try to protect the assets held in trust from third party claims. However, to the extent that such claims are successfully made against the trust assets, they may reduce the per-share conversion price below approximately $5.82. An eligible stockholder may request conversion at any time after the mailing to our stockholders of the proxy statement and prior to the vote taken with respect to a proposed business combination at a meeting held for that purpose, but the request will not be granted unless the stockholder votes against the business combination and the business combination is approved and completed. Any request for conversion, once made, may be withdrawn at any time up to the date of the meeting. It is anticipated that the funds to be distributed to stockholders entitled to convert their shares who elect conversion will be distributed promptly after completion of a business combination. Public stockholders who convert their stock into their share of the trust account still have the right to exercise the warrants that they received as part of the units. We will not complete any business combination if public stockholders owning an aggregate of 20% or more of the shares sold in this offering and purchased in the private placement exercise their conversion rights.
     Liquidation if no business combination
      If we do not complete a business combination within 18 months after the consummation of this offering, or within 24 months if the extension criteria described below have been satisfied, we will be dissolved and will distribute to all of our public stockholders, in proportion to their respective equity interests, an aggregate sum equal to the amount in the trust account, inclusive of any interest, plus any remaining net assets. Our existing stockholders have agreed to waive their respective rights to participate in any liquidation distribution occurring upon our failure to consummate a business combination, but only with respect to those shares of common stock acquired by them prior to this offering and the 170,000 shares included in the unit they have agreed to purchase in the private placement; they will participate in any liquidation distribution with respect to any shares of common stock acquired in connection with or following this offering. Additionally, the underwriters have agreed to forfeit any rights to or claims against the proceeds held in the trust account which

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include a portion of their discount and non-accountable expense allowance. There will be no distribution from the trust account with respect to our warrants.
      If we were to expend none of the net proceeds of this offering, other than the proceeds deposited in the trust account, and without taking into account interest, if any, earned on the trust account, the initial per-share liquidation price would be approximately $5.82 or approximately $.18 less than the per-unit offering price of $6.00. The proceeds deposited in the trust account could, however, become subject to the claims of our creditors that could be prior to the claims of our public stockholders. We cannot assure you that the actual per-share liquidation price will not be less than approximately $5.82, plus interest, due to claims of creditors. The officers and directors of the Company have agreed pursuant to an agreement with us and Ferris, Baker Watts, Inc. that, if we liquidate prior to the consummation of a business combination, they will be personally liable under certain circumstances to ensure that the proceeds of the trust account are not reduced by the claims of vendors or other entities that are owed money by us for services rendered or products sold to us in excess of the net proceeds of this offering not held in the trust account. We cannot assure you, however, that the officers and directors of the Company will be able to satisfy those obligations.
      If we enter into either a letter of intent, an agreement in principle or a definitive agreement to complete a business combination prior to the expiration of 18 months after the consummation of this offering, but are unable to complete the business combination within the 18-month period, then we will have an additional six months in which to complete the business combination contemplated by the letter of intent, agreement in principle or definitive agreement. If we are unable to do so by the expiration of the 24-month period from the consummation of this offering, we will then liquidate. The trustee of the trust account will immediately commence liquidating the investments constituting the trust account and will turn over the proceeds to our public stockholders.
Competition
      In identifying, evaluating and selecting target businesses, we may encounter intense competition from other entities having a business objective similar to ours. Many of these entities are well established and have extensive experience identifying and effecting business combinations directly or through affiliates. Many of these competitors possess greater technical, human and other resources than us and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous potential target businesses that we could acquire with the net proceeds of this offering, our ability to compete in acquiring certain sizable target businesses will be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of target businesses. Further:
  •  our obligation to seek stockholder approval of a business combination or obtain the necessary financial statements to be included in the proxy materials to be sent to stockholders in connection with a proposed business combination may delay the completion of a transaction;
 
  •  our obligation to convert into cash shares of common stock held by our public stockholders in certain instances may reduce the resources available to us for a business combination; and
 
  •  our outstanding warrants and the purchase option granted to Ferris, Baker Watts, Inc., and the future dilution they potentially represent, may not be viewed favorably by certain target businesses.
      Any of these factors may place us at a competitive disadvantage in successfully negotiating a business combination. Our management believes, however, that our status as a public entity and potential access to the United States public equity markets may give us a competitive advantage over privately-held entities having a similar business objective as ours in acquiring a target business on favorable terms.
      If we succeed in effecting a business combination, there will be, in all likelihood, intense competition from competitors of the target businesses. In particular, certain industries that experience rapid growth frequently attract an increasingly larger number of competitors, including competitors with increasingly greater financial, marketing, technical and other resources than the initial competitors in the industry. The

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degree of competition characterizing the industry of any prospective target business cannot presently be ascertained. We cannot assure you that, subsequent to a business combination, we will have the resources to compete effectively, especially to the extent that the target businesses are in high-growth industries.
Facilities
      We do not own any real estate or other physical properties materially important to our operation. Our headquarters are located at 4336 Montgomery Avenue, Bethesda, Maryland, 20814. The cost of this space is included in the $4,000 per month fee IGN, LLC charges us for general and administrative services pursuant to a letter agreement between us and IGN, LLC. We believe that our office facilities are suitable and adequate for our business as it is presently conducted.
Employees
      We currently have two executive officers, both of whom are members of our board of directors as well as five special advisors. We have two other part time employees. These individuals are not obligated to devote their full time to our matters and intend to devote only as much time as they deem necessary to our affairs, although we expect Mr. Mukunda to devote an average of approximately fifteen hours per week to our business, for each of Mr. Cherin and Dr. Krishna to devote an average of approximately ten hours per week to our business and for Mr. Mukunda to devote substantially all of his time to our business once we have signed a term sheet with a target business. We do not intend to have any full time employees prior to the consummation of a business combination.
Legal Proceedings
      We are not involved in nor a party to any material legal proceedings.
Periodic Reporting and Audited Financial Statements
      On or about the date on which the SEC declares effective the registration statement, we will register our units, common stock and warrants under the Securities Exchange Act of 1934, and thereafter will have reporting obligations thereunder, including the requirement that we file annual and quarterly reports with the SEC. In accordance with the requirements of the Securities Exchange Act of 1934, our annual reports will contain financial statements audited and reported on by our independent registered public accounting firm.
      We will not acquire a target business if audited financial statements based on United States generally accepted accounting principles cannot be obtained for the target business. Additionally, our management will provide stockholders with audited financial statements, prepared in accordance with generally accepted accounting principles, of the prospective businesses as part of the proxy solicitation materials sent to stockholders to assist them in assessing a business combination. Our management believes that the requirement of having available audited financial statements for the target businesses will not materially limit the pool of potential target businesses available for acquisition.
Comparison to offerings of blank check companies
      The following table compares and contrasts the terms of our offering and the terms of an offering by blank check companies under Rule 419 promulgated by the SEC assuming that the gross proceeds, underwriting discounts and underwriting expenses for the Rule 419 offering are the same as this offering and that the

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underwriters will not exercise their over-allotment option. None of the terms of a Rule 419 offering will apply to this offering.
         
    Terms of Our Offering   Terms Under a Rule 419 Offering
         
Escrow of offering proceeds
  $57,210,600 of the proceeds of this offering and the private placement will be deposited into a trust account located at United Bank Inc., and maintained by Continental Stock Transfer & Trust Company acting as trustee. These proceeds consist of $55,441,200 from the net proceeds payable to us and $1,769,400 of the proceeds attributable to the underwriters’ non-accountable expense allowance.   $49,680,000 of the offering proceeds would be required to be deposited into either an escrow account with an insured depositary institution or in a separate bank account established by a broker- dealer in which the broker-dealer acts as trustee for persons having the beneficial interests in the account.
Investment of offering proceeds
  The $57,210,600 of the proceeds of this offering and the private placement held in trust will only be invested in U.S. “government securities,” defined as any Treasury Bill issued by the United States having a maturity of one hundred and eighty days or less.   Proceeds could be invested only in specified securities such as a money market fund meeting conditions of the Investment Company Act of 1940 or in securities that are direct obligations of, or obligations guaranteed as to principal or interest by, the United States.
Limitation on fair value or net assets of target business
  The initial target businesses that we acquire must have a fair market value equal to at least 80% of our net assets (excluding any fees and expenses held in the trust account for the benefit of Ferris, Baker Watts, Inc.) at the time of such acquisition.   We would be restricted from acquiring a target business unless the fair value of such business or net assets to be acquired represent at least 80% of the maximum offering proceeds.
Trading of securities issued
  The units may commence trading on or promptly after the date of this prospectus. The common stock and warrants comprising the units will begin to trade separately on the 90th day after the date of this prospectus unless Ferris, Baker Watts, Inc. informs us of its decision to allow earlier separate trading, provided we have filed with the SEC a Current Report on Form 8-K, which includes an audited balance sheet reflecting our receipt of the proceeds of this offering, including any proceeds we receive from the exercise of the over-allotment option, if such option is exercised prior to the filing of the Form 8-K.   No trading of the units or the underlying common stock and warrants would be permitted until the completion of a business combination. During this period, the securities would be held in the escrow or trust account.

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    Terms of Our Offering   Terms Under a Rule 419 Offering
         
Exercise of the warrants
  The warrants cannot be exercised until the later of the completion of a business combination or one year from the date of this prospectus and, accordingly, will only be exercised after the trust account has been terminated and distributed.   The warrants could be exercised prior to the completion of a business combination, but securities received and cash paid in connection with the exercise would be deposited in the escrow or trust account.
Election to remain an investor
  We will give our stockholders the opportunity to vote on the business combination. In connection with seeking stockholder approval, we will send each stockholder a proxy statement containing information required by the SEC. A stockholder following the procedures described in this prospectus is given the right to convert his or her shares into his or her pro rata share of the trust account. However, a stockholder who does not follow these procedures or a stockholder who does not take any action would not be entitled to the return of any funds.   A prospectus containing information required by the SEC would be sent to each investor. Each investor would be given the opportunity to notify the company, in writing, within a period of no less than 20 business days and no more than 45 business days from the effective date of the post- effective amendment, to notify the company of their election to remain an investor. If the company has not received the notification by the end of the 45th business day, funds and interest or dividends, if any, held in the trust or escrow account would automatically be returned to the stockholder. Unless a sufficient number of investors elect to remain investors, all of the deposited funds in the escrow account must be returned to all investors and none of the securities will be issued.
Business combination deadline
  A business combination must occur within 18 months after the consummation of this offering or within 24 months after the consummation of this offering if a letter of intent, agreement in principal or definitive agreement relating to a prospective business combination was entered into prior to the end of the 18-month period.   If an acquisition has not been consummated within 18 months after the effective date of the initial registration statement, funds held in the trust or escrow account would be returned to investors.
Release of funds
  The proceeds held in the trust account will not be released until the earlier of the completion of a business combination or our liquidation upon our failure to effect a business combination within the allotted time.   The proceeds held in the escrow account would not be released until the earlier of the completion of a business combination or the failure to effect a business combination within the allotted time.

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MANAGEMENT
Directors, Executive Officers and Special Advisors
      Our current directors, executive officers and special advisors are as follows:
             
Name   Age   Position
         
Dr. Ranga Krishna
    42     Chairman of the Board
Ram Mukunda
    47     Chief Executive Officer, President and Director
John Cherin
    64     Chief Financial Officer, Treasurer and Director
Sudhakar Shenoy
    58     Director
Suhail Nathani
    40     Director
Larry Pressler
    63     Special Advisor
P.G. Kakodkar
    69     Special Advisor
Shakti Sinha
    48     Special Advisor
Dr. Prabuddha Ganguli 
    56     Special Advisor
Dr. Anil K. Gupta
    55     Special Advisor
      Dr. Ranga Krishna, has served as our Chairman of the Board since December 15, 2005. Dr. Krishna previously served as a Director from May 25, 2005 to December 15, 2005 and as our Special Advisor from April 29, 2005 through June 29, 2005. In September 1999, he co-founded Fastscribe, Inc., an Internet-based medical and legal transcription company with its operations in India and over 200 employees. He has served as a director of Fastscribe since September 1999. In February 2003, Dr. Krishna founded International Pharma Trials, Inc., a company with operations in India and over 150 employees which assists U.S. pharmaceutical companies performing Phase II clinical trials in India. He is currently the Chairman and CEO of that company. In April 2004, Dr. Krishna founded Global Medical Staffing Solutions, Inc., a company that recruits nurses and other medical professionals from India and places them in U.S. hospitals. Dr. Krishna is currently serving as the Chairman and CEO of that company. Dr. Krishna is a member of several organizations, including the American Academy of Neurology and the Medical Society of the State of New York. He is also a member of the Medical Arbitration panel for the New York State Worker’s Compensation Board. Dr. Krishna was trained at New York’s Mount Sinai Medical Center (1991-1994) and New York University (1994-1996).
      Mr. Ram Mukunda, has served as our Chief Executive Officer, President and a Director since our inception on April 29, 2005 and was Chairman of the Board from April 29, 2005 through December 15, 2005. Since September, 2004 Mr. Mukunda has served as Chief Executive Officer of Integrated Global Networks, LLC, a communications contractor in the U.S. Government space. From January, 1990 to May, 2004, Mr. Mukunda served as Founder, Chairman and Chief Executive Officer of Startec Global Communications, an international telecommunications carrier focused on providing voice over Internet protocol (VOIP) services into the emerging economies. Startec was among the first carriers to have a direct operating agreement with India for the provision of telecom services. Mr. Mukunda was responsible for the organization and structuring of the acquisition of a number of companies by Startec, for strategic investments in companies with India-based operations or which provided services to India-based companies and for integrating the acquired companies with Startec. Under Mr. Mukunda’s tenure at Startec, the company made an initial public offering of its equity securities in 1997 and conducted a public high-yield debt offering in 1998. Mr. Mukunda further was responsible for the restructuring of Startec after the company filed for protection under Chapter 11 in December 2001. Startec emerged from Chapter 11 in 2004. Ferris, Baker Watts, Inc., the representative of the underwriters for this offering, acted as the managing underwriter in connection with the initial public offering of Startec in 1997, and one of its executives is also a member of the board of directors of Startec.
      From June 1987 to January 1990, Mr. Mukunda served as Strategic Planning Advisor at INTELSAT, a provider of satellite capacity. Mr. Mukunda serves on the Board of Visitors at the University of Maryland, School of Engineering. Mr. Mukunda is the recipient of several awards, including the University of Maryland’s 2001 Distinguished Engineering Alumnus Award and the 1998 Ernst & Young, LLP’s Entrepreneur of the Year Award. He holds B.S. degrees in electrical engineering and mathematics and a masters degree in Engineering from the University of Maryland.

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      Mr. John Cherin, has served as our Chief Financial Officer and Treasurer and Director since our inception on April 29, 2005. Since 1998, Mr. Cherin has acted as a consultant and the principal of various partnerships, such as Cherin Global Consulting LC, Cherin Group LLC, Dolphin LLC, Infinity Global LLC and Cruising Global Inc. From 1966 through 1998 he worked at Arthur Andersen, an independent registered public accounting firm. Mr. Cherin was admitted to the worldwide partnership in 1977. Mr. Cherin served as a Senior Partner from March, 1993 to June 1998. From October 1984 to March 1993 Mr. Cherin ran the Enterprise practice for the metropolitan Washington area. Prior to that, Mr. Cherin ran the entrepreneurial practice in South Florida from September, 1977 to October, 1984. Mr. Cherin holds a BA degree from Northeastern University in Boston.
      Sudhakar Shenoy, has served as our Director since May 25, 2005. Since January 1981, Mr. Shenoy has been the Founder, Chairman and CEO of Information Management Consulting, Inc., a business solutions and technology provider to the government, business, health and life science sectors. Mr. Shenoy is a member of the Non Resident Indian Advisory Group that advises the Prime Minister of India on strategies for attracting foreign direct investment. Mr. Shenoy was selected for the United States Presidential Trade and Development Mission to India in 1995. From 2002 to June 2005 he served as the chairman of the Northern Virginia Technology Council. Since 1998 Mr. Shenoy has served on the Board of Directors of Startec Global Communications, a telecommunication company of which Mr. Mukunda, our CEO, was Chairman and CEO. In 1970, Mr. Shenoy received a B. Tech (Hons.) in electrical engineering from the Indian Institute of Technology (IIIT). In 1971 and 1973 he received an M.S. in electrical engineering and an M.B.A. from the University of Connecticut Schools of Engineering and Business Administration, respectively.
      Suhail Nathani, has served as our Director since May 25, 2005. Since September, 2001 he has served as a partner at the Economics Laws Practice in India, which he co-founded. The 25-person firm focuses on consulting, general corporate law, tax regulations, foreign investments and issues relating to the World Trade Organization (WTO). From December 1998 to September 2001, Mr. Nathani was the Proprietor of the Strategic Law Group, also in India, where he practiced telecommunications law, general litigation and licensing. Mr. Nathani earned a LLM in 1991 from Duke University School of Law. In 1990 Mr. Nathani graduated from Cambridge University with a MA (Hons) in Law. In 1987 he graduated from Sydenham College of Commerce and Economics, Bombay India.
      Senator Larry Pressler, has served as our Special Advisor since February 3, 2006. Since leaving the U.S. Senate in 1997, Mr. Pressler has been a combination of businessman, lawyer, corporate board director and lecturer at universities. From March 2002 to present he has been a partner in the New York firm Brock Law Partners. Prior to that, March 1997 to March 2002, he was a law partner with O’Connor & Hannan.
      From 1979 to 1997, Mr. Pressler served as a member of the United States Senate. He served as the Chairman of the Senate Commerce Committee on Science and Transportation, and the Chairman of the Subcommittee on Telecommunications (1994 to 1997). From 1995 to 1997 he served as a Member of the Committee on Finance and from 1981 to 1995 on the Committee on Foreign Relations. From 1975 to 1979, Mr. Pressler served as a member of the United States House of Representatives. Among other bills, Senator Pressler authored the Telecommunications Act of 1996. As a member of the Senate Foreign Relations Committee, he authored the “Pressler Amendment” which became the parity for nuclear weapons in Asia from 1980 to 1996.
      In 2000, Senator Pressler accompanied President Clinton on a visit to India. He is a frequent traveler to India where he lectures at universities and business forums. He is a member of several boards of Indian and US companies including the board of directors for Infosys Technologies, Inc. (INFY). He serves on the board of directors for The Philadelphia Stock Exchange and Flight Safety Technologies, Inc. (FLST). From 2002 to 2005 he served on the board of advisors at ChrysCapital, a fund focused on investments in India. He was on the board of directors of Spectramind from its inception in 1999 until its sale to WIPRO, Ltd (WIT) in 2003.
      In 1971, Mr. Pressler earned a Juris Doctor from Harvard Law School and a Masters in Public Administration from the Kennedy School of Government at Harvard. From 1964 to 1965 he was a Rhodes Scholar at Oxford University, England where he earned a diploma in public administration. Mr. Pressler is a

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Vietnam war veteran having served in the U.S. Army in Vietnam in 1967-68. He is an active member of the Veterans of Foreign Wars Association.
      P. G. Kakodkar, has served as our Special Advisor since February 3, 2006. Mr. Kakodkar serves on 13 boards of Indian companies, 11 of which are public in India. Since January of 2005 he has been a member of the board of directors of State Bank of India (SBI) Fund Management, Private Ltd. which runs one of the largest mutual funds in India. Mr. Kakodkar’s career spans 40 years at the State Bank of India. He served as its Chairman from October 1995 to March 1997. Prior to his Chairmanship he was the Managing Director of State Bank of India (SBI) Fund Management Private Ltd. which operates the SBI Mutual Fund.
      Mr. Kakodkar is on the boards of 13 companies. Since July 2005 he has served on the board of directors of the Multi Commodity Exchange of India. Since April 2000 he has been on the board of Mastek, Ltd, an Indian software house specializing in client server applications. In June 2001 he joined the board of Centrum Capital Ltd, a financial services company. Since March 2000 he has been on the board of Sesa Goa Ltd., the second largest mining company in India. In April 2000 he joined the board at Uttam Galva Steel and in April 1999 he joined the board of Goa Carbon Ltd a manufacturer-exporter of petcoke. Mr. Kakodkar received a BA from Karnataya University and an MA from Bombay University, in economics, in 1954 and 1956, respectively. Mr. Kakodkar currently is an advisor to Societe Generale, India, which is an affiliate of SG Americas Securities, LLC, one of the underwriters of this offering.
      Shakti Sinha, has served as our Special Advisor since May 25, 2005. Since July 2004, Mr. Sinha has been working as a Visiting Senior Fellow, on economic development, with the Government of Bihar, India. From January 2000 to June 2004 he was a Senior Advisor to the Executive Director on the Board of the World Bank. From March 1998 to November 1999 he was the Private Secretary to the Prime Minister of India. He was also the Chief of the Office of the Prime Minister. Prior to that he has held high level positions in the Government of India, including from January 1998 to March 1998 as a Board Member responsible for Administration in the Electricity Utility Board of Delhi. From January 1996 to January 1998 he was the Secretary to the Leader of the Opposition in the lower house of the Indian Parliament. From December 1995 to May 1996 he was a Director in the Ministry of Commerce. In 2002, Mr. Sinha earned a M.S. in International Commerce and Policy from the George Mason University, USA. In 1978 he earned a M.A. in History from the University of Delhi and in 1976 he earned a BA (Honors) in Economics from the University of Delhi.
      Dr. Prabuddha Ganguli has served as our Special Advisor since May 25, 2005. Since September 1996 Dr. Ganguli has been the CEO of Vision-IPR. The company offers management consulting on the protection of Intellectual Property Rights (IPR). His clients include companies in the Pharmaceutical, Chemical and Engineering industries. He is an adjunct professor of IPR at the Indian Institute of Technology, Bombay. Prior to 1996, from August 1991 to August 1996 he was the Head of Information Services and Patents at the Hindustan Lever Research Center. In 1986 he was elected as a fellow to the Maharastra Academy of Sciences. In 1966 he received the National Science Talent Scholarship (NSTS). In 1977 he was awarded the Alexander von Humboldt Foundation Fellow (Germany). He is Honorary Scientific Consultant to the Principal Scientific Adviser to the Government of India. He is a Member of the National Expert Group on Issues linked to Access to Biological materials vis-à-vis TRIPS and CBD Agreements constituted by the Indian Ministry of Commerce and Industry. He is also a Member of the Editorial Board of the IPR journal “World Patent Information” published by Elsevier Science Limited, UK. He is a Consultant to the World Intellectual Property Organization (WIPO), Geneva in IPR capability building training programs in various parts of the world. In 1976 Dr. Ganguli received a PhD from the Tata Institute of Fundamental Research, Bombay in chemical physics. In 1971 he received a M.Sc. in Chemistry from the Indian Institute of Technology (Kanpur) and in 1969 he earned a BS from the Institute of Science (Bombay University).
      Dr. Anil K. Gupta, has served as our Special Advisor since May 25, 2005. Dr. Gupta has been Chair of the Management & Organization Department, Ralph J. Tyser Professor of Strategy and Organization, and Research Director of the Dingman Center for Entrepreneurship at the Robert H. Smith School of Business, The University of Maryland at College Park since July 2003. Dr. Gupta earned a Bachelor of Technology from the Indian Institute of Technology in 1970, an MBA from the Indian Institute of Management in 1972, and a Doctor of Business Administration from the Harvard Business School in 1980.

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      Dr. Gupta has served on the board of directors of NeoMagic Corporation (NMGC) since October 2000 and has previously served as a director of Omega Worldwide (OWWP) from October 1999 through August 2003 and Vitalink Pharmacy Services (VTK) from July 1992 through July 1999.
      Our board of directors is divided into three classes (Class A, Class B and Class C) with only one class of directors, being elected in each year and each class serving a three-year term. The term of office of the Class A directors, consisting of Mr. Nathani and Mr. Shenoy, will expire at our first annual meeting of stockholders. The term of office of the Class B directors, consisting of Mr. Cherin and Dr. Krishna, will expire at the second annual meeting of stockholders. The term of office of the Class C directors, consisting of Mr. Mukunda, will expire at the third annual meeting of stockholders.
      These individuals will play a key role in identifying and evaluating prospective acquisition candidates, selecting the target business, and structuring, negotiating and consummating its acquisition. None of these individuals has been a principal of or affiliated with a public company or blank check company that executed a business plan similar to our business plan and none of these individuals is currently affiliated with such an entity. However, we believe that the skills and expertise of these individuals, their collective access to acquisition opportunities and ideas, their contacts, and their transaction expertise should enable them to successfully identify and evaluate prospective acquisition candidates, select target businesses and structure, negotiate and consummate a business combination, although we cannot assure you that they will, in fact, be able to do so.
Executive Compensation
      Other than IGN, LLC, no executive officer or any affiliate of an executive officer has received any cash compensation for services rendered. We have agreed to pay IGN, LLC, an affiliate of Mr. Mukunda, a monthly fee of $4,000 for general and administrative services including office space, utilities and secretarial support. This arrangement is for our benefit and is not intended to provide Mr. Mukunda, Chief Executive Officer of IGN, LLC and our Chairman, Chief Executive Officer and President, with compensation in lieu of salary. We believe, based on rents and fees for similar services in the Washington, DC metropolitan area, that the fee charged by IGN, LLC is at least as favorable as we could have obtained from an unaffiliated third party. However, because our directors at the time we entered into the agreement with IGN, LLC may not be deemed “independent”, we did not have the benefit of disinterested directors approving the transaction.
      Other than the $4,000 fee paid to IGN, LLC, no compensation of any kind, including finder’s and consulting fees, will be paid to any of our existing stockholders, including our officers, directors and special advisors, or any of their respective affiliates, for services rendered prior to or in connection with a business combination. However, these individuals will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. There is no limit on the amount of these out-of-pocket expenses and there will be no review of the reasonableness of the expenses by anyone other than our board of directors, which includes persons who may seek reimbursement, or a court of competent jurisdiction if such reimbursement is challenged. If all of our directors are not deemed “independent,” we will not have the benefit of independent directors examining the propriety of expenses incurred on our behalf and subject to reimbursement.
      Other than the agreement with IGN, LLC, there are no current agreements or understandings with any of our existing stockholders or any of their respective affiliates with respect to the payment of compensation of any kind subsequent to a business combination. However, there can be no assurance that such agreements may not be negotiated in connection with, or subsequent to, a business combination.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Prior Share Issuances
      On May 5, 2005, we issued 1,750,000 shares for an aggregate consideration of $17,500 in cash, at an average purchase price of approximately $.01 per share, as follows:
             
    Number of    
Name   Shares(1)   Relationship to Us
         
Dr. Ranga Krishna
    250,000     Chairman of the Board
Ram Mukunda
    1,250,000     Chief Executive Officer, President and Director
John Cherin
    250,000     Chief Financial Officer, Treasurer and Director
      On June 20, 2005, we issued 750,000 shares for an aggregate consideration of $7,500 in cash, at a purchase price of approximately $.01 per share, as follows:
             
    Number of    
Name   Shares(1)(2)(3)   Relationship to Us
         
Parveen Mukunda(4)
    425,000     Secretary
Sudhakar Shenoy
    37,500     Director
Suhail Nathani
    37,500     Director
Shakti Sinha
    12,500     Special Advisor
Dr. Prabuddha Ganguli
    12,500     Special Advisor
Dr. Anil K. Gupta
    25,000     Special Advisor
 
(1)  The share numbers and per share purchase prices in this section reflect the effects of a 1-for-2 reverse split effected September 29, 2005.
 
(2)  Representing shares issued to our officers, directors and Special Advisors in consideration of services rendered or to be rendered to us.
 
(3)  On September 7, 2005 one shareholder surrendered to the Company 62,500 shares, and on February 3, 2006 a shareholder surrendered to the Company 137,500 shares. These were reissued as set forth below.
 
(4)  Parveen Mukunda is the wife of Ram Mukunda.
      On February 3, 2006, we reissued the 200,000 shares for an aggregate consideration of $2,000 in cash at a price of approximately $.01 per share as follows:
             
Name   Number of Shares   Relationship to Us
         
Dr. Ranga Krishna
    100,000     Chairman of the Board
John Cherin
    37,500     Chief Financial Officer, Treasurer and Director
Larry Pressler
    25,000     Special Advisor
P.G. Kakodkar
    12,500     Special Advisor
Sudhakar Shenoy
    12,500     Director
Suhail Nathani
    12,500     Director
      The holders of the majority of these shares will be entitled to make up to two demands that we register these shares pursuant to an agreement to be signed prior to or on the date of this prospectus. The holders of the majority of these shares can elect to exercise these registration rights at any time after the date on which the lock-up period expires. In addition, these stockholders have certain “piggy-back” registration rights on registration statements filed subsequent to such date. We will bear the expenses incurred in connection with the filing of any such registration statements.
      Mr. Mukunda has agreed with Ferris, Baker Watts, Inc. that he and certain of his affiliates, designees and assignees collectively will purchase in the aggregate 170,000 units in a private placement that will occur immediately prior to this offering at a price equal to the price of this offering, $6.00 per unit.

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      The existing stockholders have agreed to waive their respective rights to participate in any liquidation distribution occurring upon our failure to consummate a business combination, but only with respect to those shares of common stock acquired by them prior to this offering, and the 170,000 shares included in the units they have agreed to purchase in the private placement, therefore, they will participate in any liquidation distribution with respect to any shares of common stock acquired in connection with or following this offering. In addition, in connection with the vote required for our initial business combination, all of our existing stockholders, including all of our officers, directors and special advisors, have agreed to vote all of the shares of common stock owned by them, including those acquired in the private placement or during or after this offering, in accordance with the majority of the shares of common stock voted by the public stockholders.
Conflicts of Interest
      Investors should be aware of the following potential conflicts of interest:
  •  None of our officers, directors and special advisors are required to commit their full time to our affairs and, accordingly, they may have conflicts of interest in allocating management time among various business activities.
 
  •  In the course of their other business activities, our officers, directors and special advisors may become aware of investment and business opportunities that may be appropriate for presentation to us as well as the other entities with which they are affiliated. They may have conflicts of interest in determining to which entity a particular business opportunity should be presented. For a complete description of our management’s other affiliations, see the previous section entitled “Management.”
 
  •  We may also determine to effect a business combination with another entity that is affiliated with one or more of our existing stockholders.
 
  •  Our current management will only be able to remain with the combined company after the consummation of a business combination if they are able to negotiate the same as part of any such combination. If management negotiates to be retained post-business combination as a condition to any potential business combination, such negotiations may result in a conflict of interest between management and the stockholders resulting in management attempting to negotiate terms that may be less favorable to the stockholders than what they might otherwise receive.
 
  •  Our officers, directors and special advisors may in the future become affiliated with entities, including other blank check companies, engaged in business activities similar to those intended to be conducted by us.
 
  •  Because our officers, directors and special advisors own shares of our common stock that will be subject to lock-up agreements restricting their sale until six months after a business combination is successfully completed, our board may have a conflict of interest in determining whether a particular target business is appropriate to effect a business combination. The personal and financial interests of our directors, officers and special advisors may influence their motivation in identifying and selecting target businesses and completing a business combination in a timely manner.
 
  •  IGN, LLC, an affiliate of Mr. Mukunda, has agreed that, commencing on the effective date of this prospectus through the acquisition of a target business, it will make available to us office space and certain general and administrative services, as we may require from time to time. We have agreed to pay IGN, LLC $4,000 per month for these services. Mr. Mukunda is the Chief Executive Officer of IGN, LLC. As a result of this affiliation, Mr. Mukunda will benefit from the transaction to the extent of his interest in IGN, LLC. However, this arrangement is solely for our benefit and is not intended to provide Mr. Mukunda with compensation in lieu of a salary. We believe, based on rents and fees for similar services in the Washington, DC metropolitan area, that the fee charged by IGN, LLC is at least as favorable as we could have obtained from an unaffiliated third party. However, as our directors at the time we entered into this agreement may not be deemed “independent,” we did not have the benefit of disinterested directors approving this transaction.

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      In general, officers and directors of a corporation incorporated under the laws of the State of Maryland are required to present business opportunities to a corporation if:
  •  the corporation could financially undertake the opportunity;
 
  •  the opportunity is within the corporation’s line of business; and
 
  •  it would not be fair to the corporation and its stockholders for the opportunity not to be brought to the attention of the corporation.
      Accordingly, as a result of the multiple business affiliations, our officers and directors may have similar legal obligations relating to presenting business opportunities meeting the above listed criteria to other entities. For example, Mr. Mukunda has pre-existing fiduciary obligations that arise as a result of his affiliation with IGN, LLC. Although we believe it is unlikely that IGN, LLC would seek to acquire businesses that we target, we cannot assure you that this will not occur. In addition, conflicts of interest may arise when our board evaluates a particular business opportunity with respect to the above-listed criteria. We cannot assure you that any of the above mentioned conflicts will be resolved in our favor.
      In order to minimize potential conflicts of interest that may arise from multiple corporate affiliations, each of our officers, directors and special advisors has agreed, until the earliest of a business combination, our liquidation or such time as he ceases to be an officer or director or special advisor, to present to us for our consideration, prior to presentation to any other entity, any business opportunity which may reasonably be required to be presented to us under Maryland law, subject to any pre-existing fiduciary obligations they might have.
      In connection with the vote required for any business combination, all of our existing stockholders (which includes all of our officers, directors and special advisors) have agreed to vote all of their respective shares of common stock, including shares they may acquire in the private placement or during or after this offering, in accordance with the vote of the public stockholders owning a majority of the shares of our common stock sold in this offering. Accordingly, they will not be entitled to exercise the conversion rights available to public stockholders who vote against a business combination. In addition, they have agreed to waive their respective rights to participate in any liquidation distribution, but only with respect to those shares of common stock acquired by them prior to this offering and the 170,000 shares included in the units they have agreed to purchase in the private placement.
      To further minimize potential conflicts of interest, we have agreed not to consummate a business combination with an entity which is affiliated with any of our existing stockholders unless we obtain an opinion from an independent investment banking firm that the business combination is fair to our stockholders from a financial perspective.
      Mr. Mukunda has loaned a total of $100,000 to us for the payment of offering expenses. Dr. Krishna has loaned a total of $50,000 to us for the payment of offering expenses. Upon the consummation of this offering, the founders will loan an additional $720,000 to us for working capital purposes. Each loan bears interest at a rate of 4% per year and will be payable on the earlier of the consummation of a business combination or the first anniversary of the consummation of this offering. Prior to the consummation of a business combination, each loan will solely repaid out the interest earned on the escrowed funds, provided that we will not be required to make any payments from such interest until we have withdrawn an aggregate of $1,855,000 from such interest for working capital purposes.
      We will reimburse our officers, directors and special advisors for any out-of-pocket business expenses incurred by them in connection with certain activities on our behalf such as identifying and investigating possible target businesses and business combinations. There is no limit on the amount of accountable out-of-pocket expenses reimbursable by us, which will be reviewed only by our board or a court of competent jurisdiction if such reimbursement is challenged.

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      Other than the reimbursable out-of-pocket expenses payable to our officers, directors and our special advisor, no compensation or fees of any kind, including finders and consulting fees, will be paid to any of our existing stockholders, officers, directors, or our special advisor who owned our common stock prior to this offering, or, other than under the general and administrative services arrangement with IGN, LLC, to any of their respective affiliates for services rendered to us prior to or with respect to the business combination.
      All ongoing and future transactions between us and any of our officers, directors, special advisors or their respective affiliates, including loans by our officers and directors, will be on terms believed by us to be no less favorable than are available from unaffiliated third parties and such transactions or loans, including any forgiveness of loans, will require prior approval in each instance by a majority of our uninterested “independent” directors (to the extent we have any) or the members of our board who do not have an interest in the transaction, in either case who had access, at our expense, to our attorneys or independent legal counsel.

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PRINCIPAL STOCKHOLDERS
      On May 5, 2005, we issued an aggregate of 1,750,000 shares of our common stock to our officers, directors and special advisors for an aggregate consideration of $17,500. On June 20, 2005, we issued 750,000 shares for an aggregate consideration of $7,500 in cash, at a purchase price of approximately $.01 per share, to certain of our officers, directors and special advisors. On September 7, 2005, one of our shareholders surrendered 62,500 shares of our common stock to us and on February 3, 2006, one of our shareholders surrendered 137,500 shares of our common stock to us. We reissued these shares. For additional information, see the section above entitled “Certain Relationships and Related Transactions.” On September 29, 2005, the Company amended its Certificate of Incorporation to effect a 1-for-2 reverse stock split pursuant to which every two shares of the Company’s Common Stock outstanding prior to the reverse split were exchanged for one share of the Company’s Common Stock after the reverse split. The share numbers in this Section reflect the effects of the reverse stock split.
      The following table sets forth information regarding the beneficial ownership of our common stock as of February 3, 2006, and as adjusted to reflect the sale of our common stock included in the units offered by this prospectus (and sold in the private placement assuming no purchase of additional units by our officers and directors in this offering), by:
  •  each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock;
 
  •  each of our executive officers, directors and our special advisors; and
 
  •  all our officers and directors as a group.
      Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all shares of common stock beneficially owned by them.
                         
    Amount and   Approximate Percentage of
    Nature of   Outstanding Common Stock
Name and Address of   Beneficial    
Beneficial Owner(1)   Ownership   Before Offering   After Offering(2)
             
Ranga Krishna
    350,000       14.0%       2.8%  
Ram Mukunda
    1,250,000 (3)     50.0%       10.0%  
John Cherin
    287,500       11.5%       2.3%  
Parveen Mukunda
    425,000       17.0%       3.4%  
Sudhakar Shenoy
    50,000       2.0%       0.4%  
Suhail Nathani
    50,000       2.0%       0.4%  
Larry Pressler
    25,000       1.0%       0.2%  
P.G. Kakodkar
    12,500       0.5%       0.1%  
Shakti Sinha
    12,500       0.5%       0.1%  
Dr. Prabuddha Ganguli
    12,500       0.5%       0.1%  
Dr. Anil K. Gupta
    25,000       1.0%       0.2%  
All directors and executive officers as a group (5 individuals)
    1,987,500       79.5%       17.3%  
 
(1)  Unless otherwise noted, the business address of each of the following is 4336 Montgomery Avenue, Bethesda, Maryland, 20814.
 
(2)  Our officers and directors have agreed to purchase an aggregate of 170,000 units in the private placement, which purchase will occur immediately prior to the offering. The percentage ownership after the offering for all executive officers and directors as a group reflects this purchase; however, the percentages for each holder do not since the allocation of the purchase obligation among the officers and directors has not yet been determined.
 
(3)  Excludes 425,000 shares owned by Mr. Mukunda’s wife, Parveen Mukunda, as to which Mr. Mukunda disclaims beneficial ownership.

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      Immediately after this offering, our existing stockholders, which include all of our officers, directors and special advisors, collectively, will beneficially own 21.4% of the then issued and outstanding shares of our common stock. Because of this ownership block, these stockholders may be able to effectively exercise control over all matters requiring approval by our stockholders, including the election of directors and approval of significant corporate transactions, other than approval of a business combination.
      All of the shares of our common stock outstanding prior to the date of this prospectus will be subject to lock-up agreements between us, the holders of the shares and Ferris, Baker Watts, Inc. restricting the sale of such shares until six months after a business combination is successfully completed. During the lock-up period, the holders of the shares will not be able to sell or transfer their shares of common stock except in certain limited circumstances such as to their spouses and children or trusts established for their benefit, but will retain all other rights as our stockholders, including without limitation, the right to vote their shares of common stock. If we are unable to effect a business combination and liquidate, none of our existing stockholders will receive any portion of the liquidation proceeds with respect to common stock owned by them prior to the consummation of this offering.
      Our officers and directors have agreed to purchase an aggregate of 170,000 units in a private placement that will occur immediately prior to in this offering. The shares comprising such units may not be sold, assigned or transferred until we consummate a business combination. Such individuals have further agreed to waive their right to any liquidation distributions with respect to such shares in the event we fail to consummate a business combination. These shares are subject to a lock-up on transferability until we complete a business combination.
      The warrants may trade separately on the 90 th day after the date of this prospectus unless Ferris, Baker Watts, Inc. determines that an earlier date is acceptable. In no event will Ferris, Baker Watts, Inc. allow separate trading of the common stock and warrants until we file a Current Report on Form  8-K which includes an audited balance sheet reflecting our receipt of the proceeds of this offering including any proceeds we receive from the exercise of the over-allotment option if such option is exercised prior to our filing of the Form  8-K. Purchases of warrants stabilize the price and establish a market for the warrants. In addition, it demonstrates confidence in our ultimate ability to effect a business combination, because the warrants will expire worthless if we are unable to consummate a business combination and are ultimately forced to liquidate.
      The existing stockholders have agreed to waive their respective rights to participate in any liquidation distribution occurring upon our failure to consummate a business combination, but only with respect to those shares of common stock acquired by them prior to this offering; they will participate in any liquidation distribution with respect to any shares of common stock acquired in connection with or following this offering.
      In addition, in connection with the vote required for our initial business combination, all of our existing stockholders, including all of our officers, directors and our special advisors, have agreed to vote all of the shares of common stock owned by them, including shares they may acquire in the private placement or during or after the offering, in accordance with the majority of the shares of common stock voted by the public stockholders other than our existing stockholders. Accordingly, they will not be entitled to exercise the conversion rights available to public stockholders who vote against a business combination.
      Messrs. Mukunda, Cherin and Krishna may be deemed to be our “parent”, “founder” and “promoter,” as these terms are defined under the Federal securities laws.

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DESCRIPTION OF SECURITIES
General
      We are authorized to issue 75,000,000 shares of common stock, par value $.0001, and 1,000,000 shares of preferred stock, par value $.0001. As of February 3, 2006, 2,500,000 shares of common stock are outstanding, held by 11 record holders and no shares of preferred stock are outstanding.
Units
      Each unit consists of one share of common stock and two warrants. Each warrant entitles the holder to purchase one share of common stock. Each of the common stock and warrants will trade separately on the 90th day after the date of this prospectus unless Ferris, Baker Watts, Inc. determines that an earlier date is acceptable. In no event may the common stock and warrants be traded separately until we have filed with the SEC a Current Report on Form  8-K that includes an audited balance sheet reflecting our receipt of the gross proceeds of this offering. We will file a Current Report on Form  8-K that includes this audited balance sheet upon the consummation of this offering, which is anticipated to take place three business days after the date of this prospectus. The audited balance sheet will reflect proceeds we receive from the exercise of the over-allotment option, if the over-allotment option is exercised prior to the filing of the Current Report on Form  8-K. If the over-allotment option is exercised after our initial filing of the Form 8-K, we will file an amendment to the Form 8-K to provide updated financial information to reflect the exercise of the over-allotment.
Common stock
      Our stockholders are entitled to one vote for each share held of record on all matters to be voted on by stockholders. In connection with the vote required for our initial business combination, all of our existing stockholders, including all of our officers, directors and our special advisors, have agreed to vote all of the shares of common stock owned by them, including shares acquired during or after the offering, in accordance with the majority of the shares of common stock voted by the public stockholders. Additionally, our existing stockholders, officers, directors and our special advisors will vote all of their shares in any manner they determine, in their sole discretion, with respect to any other items that come before a vote of our stockholders.
      We will proceed with the business combination only if a majority of the shares of common stock voted by the public stockholders are voted in favor of the business combination and public stockholders owning less than 20% of the shares sold in this offering and the private placement exercise their conversion rights discussed below.
      Our board of directors is divided into three classes (Class A, Class B and Class C), each of which will generally serve for a term of three years with only one class of directors being elected in each year. There is no cumulative voting with respect to the election of directors, with the result that the holders of more than 50% of the shares voted for the election of directors can elect all of the directors.
      If we are forced to liquidate prior to a business combination, our public stockholders are entitled to share ratably in the trust account, inclusive of any interest, and any net assets remaining available for distribution to them after payment of liabilities. The existing stockholders have agreed to waive their respective rights to participate in any liquidation distribution occurring upon our failure to consummate a business combination, but only with respect to those shares of common stock acquired by them prior to this offering and the 170,000 shares to be acquired by them in the private placement.
      Our stockholders have no conversion, preemptive or other subscription rights and there are no sinking fund or redemption provisions applicable to the common stock, except that public stockholders have the right to have their shares of common stock converted to cash equal to their pro rata share of the trust account if they vote against the business combination and the business combination is approved and completed. Public stockholders who convert their stock into their share of the trust account still have the right to exercise the warrants that they received as part of the units.

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Preferred stock
      Our certificate of incorporation authorizes the issuance of 1,000,000 shares of blank check preferred stock with such designation, rights and preferences as may be determined from time to time by our board of directors. No shares of preferred stock are being issued or registered in this offering. Accordingly, our board of directors is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, conversion, voting or other rights which could adversely affect the voting power or other rights of the holders of common stock, although the underwriting agreement prohibits us, prior to a business combination, from issuing preferred stock which participates in any manner in the proceeds of the trust account, or which votes as a class with the common stock on a business combination. We may issue some or all of the preferred stock to effect a business combination. In addition, the preferred stock could be utilized as a method of discouraging, delaying or preventing a change in control of us. Although we do not currently intend to issue any shares of preferred stock, we cannot assure you that we will not do so in the future.
Warrants
      No warrants are currently outstanding. Each warrant entitles the registered holder to purchase one share of our common stock at a price of $5.00 per share, subject to adjustment as discussed below, at any time commencing on the later of:
  •  the completion of a business combination; or
 
  •  one year from the date of this prospectus.
      None of the warrants may be exercised until after the consummation of a business combination and, thus, after the proceeds of the trust account have been disbursed. Upon exercise of the warrants and disbursement of the trust, the warrant exercise price will be paid directly to us. The warrants will expire five years from the date of this prospectus at 5:00 p.m., Washington, DC time. We may call the warrants for redemption,
  •  in whole and not in part,
 
  •  at a price of $.01 per warrant at any time after the warrants become exercisable,
 
  •  upon not less than 30 days’ prior written notice of redemption to each warrant holder, and
 
  •  if, and only if, the reported last sale price of the common stock equals or exceeds $8.50 per share, for any 20 trading days within a 30 trading day period ending on the third business day before we send notice of redemption to warrant holders.
      The redemption criteria for our warrants have been established at a price which is intended to provide warrantholders with a reasonable premium to the initial exercise price and provide sufficient liquidity to cushion the market reaction to our redemption call.
      The warrants will be issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. You should review a copy of the warrant agreement, which has been filed as an exhibit to the registration statement of which this prospectus is a part, for a complete description of the terms and conditions applicable to the warrants.
      The exercise price and number of shares of common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, or our recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuances of common stock at a price below their respective exercise prices.
      The warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price, by certified check payable to us, for the number of warrants being exercised. The warrant holders do not have the rights or privileges of holders of common stock and any voting rights until they exercise their warrants and receive

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shares of common stock. After the issuance of shares of common stock upon exercise of the warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by stockholders.
      No warrants will be exercisable unless at the time of exercise a prospectus relating to common stock issuable upon exercise of the warrants is current and the common stock has been registered or qualified or deemed to be exempt under the securities laws of the state of residence of the holder of the warrants. Under the terms of the warrant agreement, we have agreed to meet these conditions and use our best efforts to maintain a current prospectus relating to common stock issuable upon exercise of the warrants until the expiration of the warrants. However, we cannot assure you that we will be able to do so. The warrants may be deprived of any value and the market for the warrants may be limited if the prospectus relating to the common stock issuable upon the exercise of the warrants is not current or if the common stock is not qualified or exempt from qualification in the jurisdictions in which the holders of the warrants reside.
      No fractional shares will be issued upon exercise of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, round up to the nearest whole number the number of shares of common stock to be issued to the warrant holder.
Purchase Option
      We have agreed to sell to Ferris, Baker Watts, Inc. an option to purchase up to a total of 500,000 units at a per-unit price of $7.50 (125% of the price of the units sold in the offering). The units issuable upon exercise of this option are identical to those offered by this prospectus except that the warrants included in the option have an exercise price of $6.25 (125% of the exercise price of the warrants included in the units sold in the offering). For a more complete description of the purchase option, see the section below entitled “Underwriting — Purchase Option.”
Dividends
      We have not paid any dividends on our common stock to date and do not intend to pay dividends prior to the completion of a business combination. The payment of dividends in the future will be contingent upon our revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of a business combination. The payment of any dividends subsequent to a business combination will be within the discretion of our then board of directors. It is the present intention of our board of directors to retain all earnings, if any, for use in our business operations and, accordingly, our board does not anticipate declaring any dividends in the foreseeable future.
Our Transfer Agent and Warrant Agent
      The transfer agent for our securities and warrant agent for our warrants is Continental Stock Transfer & Trust Company.
Shares Eligible for Future Sale
      Immediately after this offering, we will have 12,500,000 shares of common stock outstanding, or 13,974,500 shares if the underwriters’ over-allotment option is exercised in full. Of these shares, the 9,830,000 shares sold in this offering, or 11,304,500 shares if the over-allotment option is exercised, will be freely tradable without restriction or further registration under the Securities Act of 1933, except for any shares purchased by one of our affiliates within the meaning of Rule 144 under the Securities Act of 1933. This will include the 170,000 shares included in the units being purchased in the private placement by our officers and directors or their nominees, which are the subject of a lock-up agreement with us and the representative of the underwriters until we complete a business combination. All of the remaining 2,500,000 shares are restricted securities under Rule 144, in that they were issued in private transactions not involving a public offering. None of those will be eligible for sale under Rule 144 until the one year holding period has elapsed with respect to each purchase. Notwithstanding the foregoing, all of those shares have been placed in escrow and will not be transferable until six months after a business combination and will only be transferred prior to that date subject to certain limited exceptions, such as transfers to family members and

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trusts for estate planning purposes and upon death, while in each case remaining subject to the escrow agreement, and will only be released prior to that date if we are forced to liquidate, in which case the shares would be destroyed, or if we were to consummate a transaction after the consummation of a business combination which results in all of the stockholders of the combined entity having the right to exchange their shares of common stock for cash, securities or other property.
Rule 144
      In general, under Rule 144 as currently in effect, a person who has beneficially owned restricted shares of our common stock for at least one year would be entitled to sell within any three-month period a number of shares that does not exceed the greater of either of the following:
  •  1% of the number of shares of common stock then outstanding, which will equal 125,000 shares immediately after this offering (or 139,745 if the underwriters exercise their over-allotment option); and
 
  •  the average weekly trading volume of the common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.
      Sales under Rule 144 are also limited by manner of sale provisions and notice requirements and to the availability of current public information about us.
Rule 144(k)
      Under Rule 144(k), a person who is not deemed to have been one of our affiliates at the time of or at any time during the three months preceding a sale, and who has beneficially owned the restricted shares proposed to be sold for at least two years, including the holding period of any prior owner other than an affiliate, is entitled to sell their shares without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144.
SEC Position on Rule 144 Sales
      The SEC has taken the position that promoters or affiliates of a blank check company and their transferees, both before and after a business combination, would act as an “underwriter” under the Securities Act of 1933 when reselling the securities of a blank check company. Accordingly, the SEC believes that those securities can be resold only through a registered offering and that Rule 144 would not be available for those resale transactions despite technical compliance with the requirements of Rule 144.
Registration Rights
      The officer, director and our special advisor holders of our 2,500,000 shares of common stock that we expect will be issued and outstanding on the date of this prospectus will be entitled to registration rights pursuant to an agreement to be signed prior to or on the effective date of this offering. The 170,000 shares purchased by such persons or their designees in the private placement will also be entitled to registration rights pursuant to the agreement. The holders of the majority of these shares are entitled to make up to two demands that we register these shares. The holders of the majority of these shares can elect to exercise these registration rights at any time after the date on which the lock-up period expires. In addition, these stockholders have certain “piggy-back” registration rights on registration statements filed subsequent to such date. We will bear the expenses incurred in connection with the filing of any such registration statements.

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UNDERWRITING
      In accordance with the terms and conditions contained in the underwriting agreement, we have agreed to sell to each of the underwriters named below, and each of the underwriters, for which Ferris, Baker Watts, Inc. is acting as representative, have severally, and not jointly, agreed to purchase on a firm commitment basis the number of units offered in this offering set forth opposite their respective names below:
         
Underwriters   Number of Units
     
Ferris, Baker Watts, Inc.
       
First Albany Capital Inc.
       
Ladenburg Thalmann & Co. Inc.
       
Merriman Curhan Ford & Co.
       
SG Americas Securities, LLC
       
Total
    9,830,000  
       
      A copy of the underwriting agreement has been filed as an exhibit to the registration statement of which this prospectus forms a part.
Pricing of Securities
      We have been advised by the representative that the underwriters propose to offer the units to the public at the initial offering price set forth on the cover page of this prospectus. They may allow some dealers concessions not in excess of $           per unit.
      Prior to this offering there has been no public market for any of our securities. The public offering price of the units and the terms of the warrants were negotiated between us and the representative. Factors considered in determining the prices and terms of the units, including the common stock and warrants underlying the units, include:
  •  the history and prospects of companies whose principal business is the acquisition of other companies;
 
  •  prior offerings of those companies;
 
  •  our prospects for acquiring an operating business in India at attractive values;
 
  •  our capital structure;
 
  •  an assessment of our management and their experience in identifying operating companies;
 
  •  general conditions of the securities markets at the time of the offering; and
 
  •  other factors as were deemed relevant.
      However, although these factors were considered, the determination of our offering price is more arbitrary than the pricing of securities for an operating company in a particular industry since the underwriters are unable to compare our financial results and prospects with those of public companies operating in the same industry.
Over-Allotment Option
      We have also granted to the underwriters an option, exercisable during the 45-day period commencing on the date of this prospectus, to purchase from us at the offering price, less underwriting discounts, up to an aggregate of 1,474,500 additional units for the sole purpose of covering over-allotments, if any. The over-allotment option will only be used to cover the net syndicate short position resulting from the initial distribution. The underwriters may exercise that option if the underwriters sell more units than the total number set forth in the table above. If any units underlying the option are purchased, the underwriters will severally purchase shares in approximately the same proportion as set forth in the table above.

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Commissions and Discounts
      The following table shows the public offering price, underwriting discount to be paid by us to the underwriters and the proceeds, before expenses, to us. This information assumes either no exercise or full exercise by the underwriters of their over-allotment option.
                         
    Per Unit   Without Option   With Option
             
Public Offering Price
  $ 6.00     $ 58,980,000     $ 67,827,000  
Discount(1)
  $ 0.30     $ 2,949,000     $ 3,391,350  
Non-accountable Expense Allowance(1)
  $ 0.18     $ 1,769,400     $ 1,769,400  
                   
Proceeds Before Expenses(2)
  $ 5.52     $ 54,261,600     $ 62,666,250  
                   
 
(1)  Ferris, Baker Watts, Inc., the representative of the underwriters in this offering, has agreed to deposit 3% of the gross proceeds attributable to the non-accountable expense allowance ($0.18 per Unit) into the trust account until the earlier of the completion of a business combination or the liquidation of the trust account.
 
(2)  The offering expenses are estimated as $815,400.
      Upon the consummation of a business combination, the underwriters will be entitled to receive that portion of the proceeds attributable to the underwriters’ discount and non-accountable expense allowance held in the trust account and any accrued interest thereon. In the event that we are unable to consummate a business combination and the trustee is forced to liquidate the trust account, the underwriters have agreed to the following: (i) forfeit any rights to or claims against such proceeds and any accrued interest thereon; and (ii) that the proceeds attributable to the underwriters’ discount and non-accountable expense allowance will be distributed on a pro-rata basis among the public shareholders along with any accrued interest thereon.
Purchase Option
      We have agreed to sell to Ferris, Baker Watts, Inc., for $100, an option to purchase up to a total of 500,000 units. The units issuable upon exercise of this option are identical to those offered by this prospectus except that the warrants included in the units have an exercise price of $6.25 (125% of the exercise price of the warrants included in the units sold in the offering). This option is exercisable at $7.50 per unit (125% of the price of the units sold in the offering) commencing on the later of the consummation of a business combination and one year from the date of this prospectus and expiring five years from the date of this prospectus. The purchase option and the 500,000 units, the 500,000 shares of common stock and the 1,000,000 warrants underlying such units, and the 1,000,000 shares of common stock underlying such warrants, have been deemed compensation by the NASD and are therefore subject to a 180-day lock-up pursuant to Rule 2710(g)(1) of the NASD Conduct Rules. Accordingly, the option may not be sold, during the offering or sold, transferred, assigned, pledged or hypothecated, or be the subject of any hedging, short sale, derivative, put, or call transaction that would result in the effective economic disposition of the securities by any person for a one year period (including the foregoing 180-day period) following the date of this prospectus. However, the purchase option may be transferred to any underwriter and selected dealer participating in the offering and their bona fide officers or partners.
      Although the purchase option and its underlying securities have been registered under the registration statement of which this prospectus forms a part of, the purchase option grants to holders demand and “piggy back” rights for periods of five and seven years, respectively, from the date of this prospectus with respect to the registration under the Securities Act of 1933 of the securities directly and indirectly issuable upon exercise of the purchase option. We will bear all fees and expenses attendant to registering the securities, other than underwriting commissions which will be paid for by the holders themselves. The exercise price and number of units issuable upon exercise of the purchase option may be adjusted in certain circumstances including in the event of a stock dividend, or our recapitalization, reorganization, merger or consolidation. However, the purchase option will not be adjusted for issuances of common stock at a price below its exercise price.

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Regulatory Restrictions on Purchase of Securities
      Rules of the SEC may limit the ability of the underwriters to bid for or purchase our securities before the distribution of the securities is completed. However, the underwriters may engage in the following activities in accordance with the rules:
  •  Stabilizing Transactions. The underwriters may make bids or purchases for the purpose of pegging, fixing or maintaining the price of our securities, so long as stabilizing bids do not exceed a specified maximum as set forth in Regulation M which requires generally, among other things, that no stabilizing bid will be initiated at or increased to a price higher than the lower of the offering price or the highest independent bid for the security on the principal trading market for the security.
 
  •  Over-Allotments and Syndicate Coverage Transactions. The underwriters may create a short position in our securities by selling more of our securities than are set forth on the cover page of this prospectus. If the underwriters create a short position during the offering, the representative may engage in syndicate covering transactions by purchasing our securities in the open market. The representative may also elect to reduce any short position by exercising all or part of the over-allotment option.
 
  •  Penalty Bids. The representative may reclaim a selling concession from a syndicate member when the common stock originally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions.
      Stabilization and syndicate covering transactions may cause the price of the securities to be higher than they would be in the absence of these transactions. The imposition of a penalty bid might also have an effect on the prices of the securities if it discourages resales of the securities.
      Neither we nor the underwriters makes any representation or prediction as to the effect that the transactions described above may have on the prices of the securities. These transactions may occur on the OTC Bulletin Board, in the over-the -counter market or on any trading market. If any of these transactions are commenced, they may be discontinued without notice at any time.
Other Terms
      We have granted Ferris, Baker Watts, Inc. for a period of two years from the later of our consummation of a business combination or one year after the effective date of the registration statement, the right to send a representative (who need not be the same individual from meeting to meeting) to observe each meeting of our board of directors. Each such representative will be required to sign a customary confidentiality agreement. We agree to give Ferris, Baker Watts, Inc. written notice of each such meeting and to provide Ferris, Baker Watts, Inc. with such items as are provided to the other directors.
      We have also entered into a financial advisory agreement with Ferris, Baker Watts, Inc., the representative of the underwriters in this offering, and SG Americas Securities, LLC, one of the participating underwriters in this offering, whereby Ferris, Baker Watts, Inc., and SG Americas Securities, LLC, will serve as our exclusive financial advisors in connection with a business combination for a period of two years from the effective date of this offering. Pursuant to the terms of this agreement, Ferris, Baker Watts, Inc. and SG Americas Securities, LLC will be entitled to receive an aggregate of two percent (2%) of the consideration associated with any business combination by us (up to a maximum aggregate fee of $1,500,000).
      Although they are not obligated to do so, any of the underwriters may introduce us to potential target businesses or assist us in raising additional capital, as needs may arise in the future. Other than our agreement with Ferris Baker Watts, Inc., the representative of the underwriters in this offering, and SG Americas Securities, LLC, one of the participating underwriters in this offering, there are no preliminary agreements or understandings between any of the underwriters and any potential targets. We are not under any contractual obligation to engage any of the underwriters to provide any services for us after this offering, but if we do, we may pay the underwriters a finder’s fee that would be determined at that time in an arm’s length negotiation

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where the terms would be fair and reasonable to each of the interested parties; provided that no agreement will be entered into and no fee will be paid prior to the one year anniversary of the date of this prospectus.
Indemnification
      We have agreed to indemnify the underwriters against some liabilities, including civil liabilities under the Securities Act of 1933, or to contribute to payments the underwriters may be required to make in this respect.
      Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers and controlling persons pursuant to the provisions of our Articles of Incorporation and our By-laws, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by our directors, officers or controlling persons in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.
LEGAL MATTERS
      Seyfarth Shaw LLP will pass upon the validity of the securities offered in this prospectus for us. Certain legal matters with respect to this offering will be passed upon for the underwriters by Gersten Savage LLP.
EXPERTS
      The financial statements of India Globalization Capital, Inc. on December 31, 2005 and for the period from April 29, 2005 (date of inception) through December 31, 2005 appearing in this prospectus and in the registration statement have been included herein in reliance upon the report, which contains an explanatory paragraph relating to substantial doubt existing about the ability of India Globalization Capital, Inc. to continue as a going concern, of Goldstein Golub Kessler LLP, independent registered public accounting firm, given on the authority of such firm as experts in accounting and auditing. Certain information relating to the Indian economy set forth in the section entitled “Proposed Business” has been included herein in reliance upon the report of Mega Ace Consultancy, an India-based consulting firm, given on the authority of such firm as experts on the Indian economy.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
      We have filed with the SEC a registration statement on Form  S-1, which includes exhibits, schedules and amendments, under the Securities Act of 1933, with respect to this offering of our securities. Although this prospectus, which forms a part of the registration statement, contains all material information included in the registration statement, parts of the registration statement have been omitted as permitted by rules and regulations of the SEC. We refer you to the registration statement and its exhibits for further information about us, our securities and this offering. The registration statement and its exhibits, as well as our other reports filed with the SEC, can be inspected and copied at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. The public may obtain information about the operation of the public reference room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains a web site at http:// www.sec.gov which contains the Form  S-1 and other reports, proxy and information statements and information regarding issuers that file electronically with the SEC.

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INDIA GLOBALIZATION CAPITAL, INC.
INDEX TO FINANCIAL STATEMENTS
         
    Page
     
Financial Statements
       
    F-2  
    F-3  
    F-4  
    F-5  
    F-6  
    F-7  

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
India Globalization Capital, Inc.
      We have audited the accompanying balance sheet of India Globalization Capital, Inc. (a development stage company) as of December 31, 2005 and the related statements of operations, stockholders’ equity and cash flows for the period from April 29, 2005 (date of inception) through December 31, 2005. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
      We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
      In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of India Globalization Capital, Inc. as of December 31, 2005 and the results of its operations and its cash flows for the period from April 29, 2005 (date of inception) through December 31, 2005 in conformity with United States generally accepted accounting principles.
      The accompanying financial statements have been prepared assuming India Globalization Capital, Inc. will continue as a going concern. The Company has a net loss, working capital deficiency and has no operations. This raises substantial doubt about the Company’s ability to continue as a going concern. As discussed in Note C, the Company is in the process of raising capital through a Proposed Offering. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
GOLDSTEIN GOLUB KESSLER LLP
New York, New York
February 12, 2006

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INDIA GLOBALIZATION CAPITAL, INC.
(a development stage company)
BALANCE SHEET
             
    December 31, 2005
     
ASSETS
Current assets:
       
 
Cash
  $ 5,764  
       
 
Total current assets:
    5,764  
Deferred offering costs
    756,699  
       
   
Total assets
  $ 762,463  
       
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
       
 
Accrued expenses
  $ 617,982  
 
Notes payable to stockholders
    150,000  
       
   
Total current liabilities
  $ 767,982  
       
COMMITMENT
       
STOCKHOLDERS’ EQUITY
       
Preferred stock — $.0001 par value; 1,000,000 shares authorized; 0 issued and outstanding
     
Common stock — $.0001 par value; 75,000,000 shares authorized; 2,437,500 issued and outstanding
    244  
Additional paid-in capital
    24,756  
Deficit accumulated during the development stage
    (30,519 )
       
   
Total stockholders’ equity
    (5,519 )
       
   
Total liabilities and stockholders’ equity
  $ 762,463  
       
See notes to financial statements

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INDIA GLOBALIZATION CAPITAL, INC.
(a development stage company)
STATEMENT OF OPERATIONS
         
    April 29, 2005
    (Date of Inception)
    through
    December 31, 2005
     
Legal and formation, travel and other startup costs
  $ 30,519  
       
Net loss for the period
  $ (30,519 )
       
Net loss per share
  $ (.01 )
       
Weighted average number of shares outstanding — basic and fully diluted
    2,325,837  
       
See notes to financial statements

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INDIA GLOBALIZATION CAPITAL, INC.
(a development stage company)
STATEMENT OF STOCKHOLDERS’ EQUITY
                                         
                Deficit    
            Accumulated    
    Common Stock   Additional   During the   Total
        Paid-In   Development   Stockholders’
    Shares   Amount   Capital   Stage   Equity
                     
Issuance of common stock to founders at $.0001 per share (1,750,000 shares on May 5, 2005 and 750,000 shares on June 20, 2005)
    2,500,000     $ 250     $ 24,750             $ 25,000  
Surrendered shares (on September 7, 2005)
    (62,500 )     (6 )     6                
Net loss
                    $ (30,519 )     (30,519 )
                               
Balance — December 31, 2005
    2,437,500     $ 244     $ 24,756     $ (30,519 )   $ (5,519 )
                               
See notes to financial statements

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INDIA GLOBALIZATION CAPITAL, INC.
(a development stage company)
STATEMENT OF CASH FLOWS
                 
    April 29, 2005
    (Date of Inception)
    through
    December 31, 2005
     
Cash flows from operating activities:
       
 
Net loss
  $ (30,519 )
 
Adjustments to reconcile net loss to net cash provided (used) by operating activities:
       
   
Changes in:
       
     
Accrued expenses
    15,854  
       
       
Net cash provided (used) by operating activities
    (14,665 )
       
Cash flows from financing activities:
       
 
Issuance of common stock to founders
    25,000  
 
Payment of offering costs
    (154,571 )
 
Proceeds from Notes payable to stockholders
    150,000  
       
       
Cash provided by financing activities
    20,429  
       
Net increase in cash and cash at end of period
  $ 5,764  
       
Non cash financing activity: accrual of deferred offering costs
  $ 602,128  
       
See notes to financial statements

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INDIA GLOBALIZATION CAPITAL, INC.
(a development stage company)
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
NOTE A — ORGANIZATION AND BUSINESS OPERATIONS
      India Globalization Capital, Inc. (the “Company”) was incorporated in Maryland on April 29, 2005. The Company was formed to serve as a vehicle for the acquisition of an operating business in an unspecified industry located in India through a merger, capital stock exchange, asset acquisition or other similar business combination. The Company has neither engaged in any operations nor generated significant revenue to date. The Company is considered to be in the development stage and is subject to the risks associated with activities of development stage companies. As such, the Company has no operating results through December 31, 2005, and their ability to begin operations is dependent upon the completion of a financing. The Company has selected March 31 as its year-end.
      The Company’s management has broad discretion with respect to the specific application of the net proceeds of a proposed private placement (the “Private Placement”) and the proposed initial public offering of its Units, (as described in Note C)(“Public Offering” and together with the Private Placement (the “Proposed Offering”) although substantially all of the net proceeds of the Proposed Offering are intended to be generally applied toward acquiring one or more operating businesses in an unspecified industry located in India (“Business Combination”), which may not constitute a business combination for accounting purposes. Furthermore, there is no assurance that the Company will be able to successfully effect a Business Combination. Upon the closing of the Proposed Offering, approximately ninety percent (90%) of the net proceeds, after payment of certain amounts to the underwriter, will be held in a trust account (“Trust Fund”) and invested in government securities until the earlier of (i) the consummation of its first Business Combination or (ii) the distribution of the Trust Fund as described below. The remaining proceeds may be used to pay for business, legal and accounting due diligence on prospective acquisitions and continuing general and administrative expenses. The Company, after signing a definitive agreement for the acquisition of a target business, will submit such transaction for stockholder approval. In the event that holders of 50% or more of the shares issued in the Proposed Offering vote against the Business Combination or the holders of 20% or more of the shares issued in the Proposed Offering elect to exercise their conversion rights, the Business Combination will not be consummated. However, the persons who were stockholders prior to the Proposed Offering (the “Founding Stockholders”) will participate in any liquidation distribution with respect to any shares of the common stock acquired in connection with or following the Proposed Offering.
      In the event that the Company does not consummate a Business Combination within 18 months from the date of the consummation of the Proposed Offering, or 24 months from the consummation of the Proposed Offering if certain extension criteria have been satisfied (the “Acquisition Period”), the proceeds held in the Trust Fund will be distributed to the Company’s public stockholders, excluding the Founding Stockholders to the extent of their initial stock holdings. In the event of such distribution, it is likely that the per share value of the residual assets remaining available for distribution (including Trust Fund assets) will be less than the initial public offering price per share in the Proposed Offering (assuming no value is attributed to the Warrants contained in the Units to be offered in the Proposed Offering discussed in Note C).
NOTE B — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
[1]     Loss per common share:
      Loss per share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding for the period.
[2]     Use of estimates:
      The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial

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INDIA GLOBALIZATION CAPITAL, INC.
(a development stage company)
NOTES TO FINANCIAL STATEMENTS — (Continued)
statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
[3]     Income taxes:
      Deferred income taxes are provided for the differences between the bases of assets and liabilities for financial reporting and income tax purposes. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized.
      The Company recorded a deferred income tax asset for the tax effect of deferred start-up costs aggregating approximately $10,400. In recognition of the uncertainty regarding the ultimate amount of income tax benefits to be derived, the Company has recorded a full valuation at December 31, 2005.
      The effective tax rate differs from the statutory rate of 34% due to increase in the valuation allowance.
[4]     Deferred offering costs:
      Deferred offering costs consist principally of legal and accounting and related regulatory filing fees incurred through the balance sheet date that are related to the Proposed Offering and that will be charged to capital upon the receipt of the capital or charged to expense if not completed.
NOTE C — PROPOSED OFFERING; VALUE OF THE UNDERWRITERS PURCHASE OPTION
      The Public Offering calls for the Company to offer for public sale up to 9,830,000 Units. Each Unit consists of one share of the Company’s common stock, $.0001 par value, and two redeemable common stock purchase Warrants. On the 90th day after the date of the prospectus or earlier, at the discretion of the underwriter, the Warrants will separate from the Units and begin to trade.
      After separation, each Warrant will entitle the holder to purchase from the Company one share of common stock at an exercise price of $5.00 commencing on the latter of (a) one year from the effective date of the Public Offering or (b) the earlier of the completion of a business combination with a target business or the distribution of the Trust Fund and expiring five years from the date of the prospectus. The Company has a right to call the Warrants, provided the common stock has traded at a closing price of at least $8.50 per share for any 20 trading days within a 30 trading day period ending on the third business day prior to the date on which notice of redemption is given. If the company calls the Warrants, the holder will either have to redeem the Warrants by purchasing the common stock from the company for $5.00 or the Warrants will expire.
      The Private Placement calls for the Company to sell to certain of its officers and directors an aggregate of 170,000 units identical to the units to be sold in the Public Offering. The Private Placement will occur immediately prior to the Public Offering.
      The Company will pay the underwriters in the Public Offering an underwriting discount of 5.0% of the gross proceeds of the Proposed Offering and a non-accountable expense allowance of 3% of the gross proceeds of the Public Offering. Ferris, Baker Watts, Inc. has agreed to deposit 3% of the gross proceeds attributable to the non-accountable expense allowance ($0.18 per Unit) into the Trust Fund until the earlier of the completion of a business combination or the liquidation of the Trust Fund. They have further agreed to forfeit any rights to or claims against such proceeds unless the Company successfully completes a business combination. In addition, the Company has agreed to sell to Ferris Baker, Watts, Inc. for $100, an option to purchase up to a total of 500,000 Units. The Units that would be issued upon exercise of this option are identical to those offered by this prospectus, except that each of the Warrants underlying this option entitles the holder to purchase one share of the Company’s common stock at a price of $6.25. This Underwriter’s Purchase Option (UPO) is exercisable at $7.50 per Unit at the latter of one year from the effective date, or the consummation of a business combination. The UPO has a life of five years from the effective date.

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INDIA GLOBALIZATION CAPITAL, INC.
(a development stage company)
NOTES TO FINANCIAL STATEMENTS — (Continued)
      The sale of the option will be accounted for as an equity transaction. Accordingly, there will be no net impact on the Company’s financial position or results of operations, except for the recording of the $100 proceeds from the sale. The Company has determined, based upon a Black-Scholes model, that the fair value of the option on the date of sale would be approximately $756,200 using an expected life of five years, volatility of 30.1% and a risk-free interest rate of 3.9%.
      IGC has no trading history, as such it is not possible to value the UPO based on historical trades. In order to estimate the value of the UPO the Company considered a basket of Indian companies that trade either in the U.S. or in the U.K. The average volatility of the representative Indian companies was calculated to be 30.1%. Management believes that this volatility is a reasonable benchmark to use in estimating the value of the UPO. The actual volatility of the Unit will depend on many factors that cannot be ascertained at this time.
NOTE D — NOTES PAYABLE TO STOCKHOLDERS
      Two unsecured notes were issued to two of the Founding Stockholders of the Company. One note for $100,000 and another for $50,000 were issued on May 2, 2005 and on September 26, 2005, respectively. The notes bear interest at 4% per annum and are payable on the earlier of April 30, 2007 or the consummation of the Proposed Offering. Due to the short-term nature of the notes, the fair value of the notes approximate their carrying amount. Approximately $4,000 of interest has been included in the statement of operations for the period ended December 31, 2005 relating to these notes.
      On December 15, 2005, the unsecured notes referred to in Note D were amended to provide that they become payable upon the earlier of the consummation of a business transaction and the first anniversary of the consummation of the Proposed Offering.
NOTE E — RELATED PARTY TRANSACTION
      The Company has agreed to pay Integrated Global Network, LLC, a related party and privately-held company where one of the Founding Stockholders serves in an executive capacity, an administrative fee of $4,000 per month for office space and general and administrative services from the effective date of the Proposed Offering through the acquisition date of a target business.
NOTE F — STOCK
      On August 24, 2005, the Company’s Board of Directors authorized a reverse stock split of one share of common stock for each two outstanding shares of common stock and approved an amendment to the Company’s Certificate of Incorporation to decrease the number of authorized shares of common stock to 75,000,000. All references in the accompanying financial statements to the number of shares of stock have been retroactively restated to reflect these transactions.

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________________________________________________________________________________
 
           Until           2006, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
          No dealer, salesperson or any other person is authorized to give any information or make any representations in connection with this offering other than those contained in this prospectus and, if given or made, the information or representations must not be relied upon as having been authorized by us. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any security other than the securities offered by this prospectus, or an offer to sell or a solicitation of an offer to buy any securities by anyone in any jurisdiction in which the offer or solicitation is not authorized or is unlawful. The delivery of this prospectus will not, under any circumstances, create any implication that the information is correct as of any time subsequent to the date of this prospectus.
 
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________________________________________________________________________________
 
$58,980,000
India Globalization Capital, Inc.
9,830,000 Units
 
PROSPECTUS
 
Ferris, Baker Watts
Incorporated
Ladenburg Thalmann & Co. Inc.
First Albany Capital
Merriman Curhan Ford & Co.
SG Corporate & Investment Banking
                    , 2006
 
 


Table of Contents

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution
      The estimated expenses payable by us in connection with the offering described in this registration statement (other than the underwriting discount and commissions and the representative non-accountable expense allowance) will be as follows:
         
Initial Trustees’ Fee(1)
    1,000  
SEC Registration Fee
  $ 45,668  
NASD Filing Fee
    39,300  
Accounting Fees and Expenses
    35,000  
Printing and Engraving Expenses
    120,000  
Legal Fees and Expenses
    475,000  
Blue Sky Services and Expenses
    40,000  
Miscellaneous(2)
    59,432  
       
Total
  $ 815,400  
       
 
(1)  In addition to the initial acceptance fee that is charged by Continental Stock Transfer & Trust Company, as trustee, the registrant will be required to pay to Continental Stock Transfer & Trust Company annual fees of $3,000 for acting as trustee, $4,800 for acting as transfer agent of the registrant’s common stock, $2,400 for acting as warrant agent for the registrant’s warrants and $1,800 for acting as escrow agent.
 
(2)  This amount represents additional expenses that may be incurred by the Registrant or Underwriters in connection with the offering over and above those specifically listed above, including distribution and mailing costs.
Item 15. Recent Sales of Unregistered Securities
      (a) During the past three years, on a pre 2-1 reverse stock split basis, we sold the following shares of common stock without registration under the Securities Act:
         
    Number of
Stockholders   Shares
     
Ram Mukunda
    2,500,000 *
John Cherin
    500,000 *
Dr. Ranga Krishna
    500,000 *
Raghu Ram
    125,000 **
Emmanuel K. Nzai
    275,000 **
Parveen Mukunda
    850,000 **
Sudhakar Shenoy
    75,000 **
Suhail Nathani
    75,000 **
Shakti Sinha
    25,000 **
Dr. Prabuddha Ganguli 
    25,000 **
Dr. Anil K. Gupta
    50,000 **
 
         
*
  Shares issued on May 5, 2005.    
**
  Shares issued on June 20, 2005.    
      On February 3, 2006, subsequent to the 2-1 reverse stock split, we issued the following shares of common stock without registration under the Securities Act:
         
    Number of
Stockholders   Shares
     
John Cherin
    37,500 *
Dr. Ranga Krishna
    100,000 *
Larry Pressler
    25,000  
P.G. Kakodkar
    12,500  
Sudhakar Shenoy
    12,500  
Suhail Nathani
    12,500  

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     The shares issued on May 5, 2005, June 20, 2005 and February 3, 2006 were issued in connection with our organization pursuant to the exemption from registration contained in Section 4(2) of the Securities Act of 1933, as they were sold to sophisticated, wealthy individuals. The shares issued to the individuals and entities above were sold for an aggregate offering price of $25,000 at an average purchase price of approximately $.005 per share. No underwriting discounts or commissions were paid with respect to such sales.
Item 16. Exhibits and Financial Statement Schedules
      (a) The following exhibits are filed as part of this Registration Statement:
         
Exhibit No.   Description
     
  1 .1   Form of Underwriting Agreement
  1 .2   Form of Selected Dealer Agreement*
  3 .1   Amended and Restated Articles of Incorporation*
  3 .2   By-laws
  4 .1   Specimen Unit Certificate*
  4 .2   Specimen Common Stock Certificate*
  4 .3   Specimen Warrant Certificate*
  4 .4   Form of Warrant Agreement between Continental Stock Transfer & Trust Company and the Registrant*
  4 .5   Form of Purchase Option to be granted to the Representative*
  5 .1   Opinion of Seyfarth Shaw LLP*
  10 .1   Amended and Restated Letter Agreement between the Registrant, Ferris, Baker Watts, Inc. and Ram Mukunda*
  10 .2   Amended and Restated Letter Agreement between the Registrant, Ferris, Baker Watts, Inc. and John Cherin*
  10 .3   Amended and Restated Letter Agreement between the Registrant, Ferris, Baker Watts, Inc. and Ranga Krishna*
  10 .4   Form of Investment Management Trust Agreement between Continental Stock Transfer & Trust Company and the Registrant
  10 .5   Promissory Note issued by the Registrant to Ram Mukunda
  10 .5.1   Extension of Due Date of Promissory Note issued to Ram Mukunda
  10 .6   Form of Stock and Unit Escrow Agreement among the Registrant, Ram Mukunda, John Cherin and Continental Stock Transfer & Trust Company
  10 .7   Form of Registration Rights Agreement among the Registrant and each of the existing stockholders*
  10 .8   Form of Unit Purchase Agreement among Ferris, Baker Watts, Inc. and one or more of the Initial Stockholders
  10 .9   Form of Office Service Agreement between the Registrant and Integrated Global Networks, LLC*
  10 .10   Amended and Restated Letter Advisory Agreement between the Registrant, Ferris, Baker Watts, Inc. and SG Americas Securities, LLC
  10 .11   Form of Letter Agreement between Ferris, Baker Watts, Inc. and certain officers and directors of the Registrant*
  10 .12   Form of Letter Agreement between Ferris, Baker Watts, Inc. and each of the Special Advisors of the Registrant*
  10 .13   Form of Letter Agreement between the Registrant and certain officers and directors of the Registrant*
  10 .14   Form of Letter Agreement between the Registrant and each of the Special Advisors of the Registrant*
  10 .15   Promissory Note issued by the Registrant to Ranga Krishna
  10 .15.1   Extension of Due Date of Promissory Note issued to Ranga Krishna
  10 .16   Form of Promissory Note to be issued by the Registrant to Ranga Krishna
  23 .1   Consent of Goldstein Golub Kessler LLP
  23 .2   Consent of Seyfarth Shaw LLP (incorporated by reference from Exhibit 5.1)
  23 .3   Consent of Mega Ace Consultancy*
  24     Power of Attorney*
  99 .1   Code of Ethics**
 
     
*
  Previously filed.
**
  To be filed with the Registrant’s initial Form 10-K.

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SIGNATURES
      Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this amended registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Bethesda, in the State of Maryland on February 14, 2006.
  India Globalization Fund, Inc.
  By:  /s/ Ram Mukunda
 
 
  Ram Mukunda
  Chief Executive Officer and President
      Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated. This document may be executed by the signatories hereto on any number of counterparts, all of which shall constitute one and the same instrument.
             
Signature   Title   Date
         
 
/s/ Ranga Krishna*

Ranga Krishna
  Chairman   February 14, 2006
 
/s/ Ram Mukunda

Ram Mukunda
  Chief Executive Officer,
President and Director
(Principal Executive Officer)
  February 14, 2006
 
/s/ John Cherin*

John Cherin
  Chief Financial Officer, Treasurer
and Director
(Principal Financial and Accounting Officer)
  February 14, 2006
 
/s/ Suhail Nathani*

Suhail Nathani
  Director   February 14, 2006
 
/s/ Sudhakar Shenoy*

Sudhakar Shenoy
  Director   February 14, 2006
by Ram Mukunda, Power of Attorney

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EXHIBIT 1.1

UNDERWRITING AGREEMENT

between

INDIA GLOBALIZATION CAPITAL, INC.

and

FERRIS, BAKER WATTS
INCORPORATED

Dated: February      , 2006

 


 

INDIA GLOBALIZATION CAPITAL, INC.

UNDERWRITING AGREEMENT

Baltimore, Maryland
February       , 2006

Ferris, Baker Watts, Inc.
100 Light Street
Baltimore, MD 21202

Dear Sirs:

          The undersigned, India Globalization Capital, Inc., a Maryland corporation (“ Company ”), hereby confirms its agreement with Ferris, Baker Watts, Inc. (hereinafter referred to as “ you ,” “ FBW ” or the “ Representative ”) and with the other underwriters named on Schedule I hereto for which FBW is acting as Representative (the Representative and the other Underwriters being collectively called the “ Underwriters ” or, individually, an “ Underwriter ”) as follows:

1. Purchase and Sale of Securities .

     1.1 Firm Securities .

          1.1.1 Purchase of Firm Securities . On the basis of the representations and warranties herein contained, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell, severally and not jointly, to the several Underwriters, an aggregate of 10,000,000 units (“ Firm Units ”) of the Company at a purchase price (net of discounts and commissions) of $5.52 per Firm Unit. The Underwriters, severally and not jointly, agree to purchase from the Company the number of Firm Securities set forth opposite their respective names on Schedule I attached hereto and made a part hereof at a purchase price (net of discounts and commissions) of $5.52 per share. The Units are to be offered initially to the public (the “ Offering ”) at the offering price set forth on the cover page of the Prospectus (as defined in Section 2.1.1 hereof). Each Firm Unit consists of one share of the Company’s common stock, par value $.0001 per share (the “ Common Stock ”), and two warrants (“ Warrant(s) ”). The shares of Common Stock and the Warrants included in the Firm Units will not be separately transferable until 90 days after the effective date (the “ Effective Date ”) of the Registration Statement (as defined in Section 2.1.1 hereof) unless FBW informs the Company of its decision to allow earlier separate trading, but in no event will FBW allow separate trading until the preparation of an audited balance sheet of the Company reflecting receipt by the Company of the proceeds of the Offering. Each Warrant entitles its holder to exercise it to purchase one share of Common Stock for $5.00 during the period commencing on the later of the consummation by the Company of its “Business Combination” or one year from the Effective Date of the Registration Statement and terminating on the five-year anniversary of the Effective Date. “ Business Combination ” shall mean any merger, capital stock exchange, asset acquisition or other similar business combination consummated by the Company with a company which has its primary operations located in India (as described more fully in the Registration Statement).

          1.1.2 Payment and Delivery . Delivery and payment for the Firm Units shall be made at 10:00 A.M., Baltimore time, on the third business day following the Effective Date of the Registration Statement (or the fourth business day following the Effective Date, if the Registration Statement is declared effective after 4:30 p.m.) or at such earlier time as shall be agreed upon by the Representative and the Company at the offices of the Representative or at such other place as shall be agreed upon by the

 


 

Representative and the Company. The hour and date of delivery and payment for the Firm Units is called the “ Closing Date .” Payment for the Firm Units shall be made on the Closing Date at the Representative’s election by wire transfer in Federal (same day) funds or by certified or bank cashier’s check(s) in Clearing House funds, payable as follows: $57,210,600 of the proceeds received by the Company for the Firm Units shall be deposited in the trust fund established by the Company for the benefit of the public stockholders as described in the Registration Statement (“ Trust Fund ”) pursuant to the terms of an Investment Management Trust Agreement (the “ Trust Agreement ”) and the remaining proceeds shall be paid to the order of the Company upon delivery to you of certificates (in form and substance satisfactory to the Underwriters) representing the Firm Units (or through the facilities of the Depository Trust Company (the “ DTC ”)) for the account of the Underwriters. The Firm Units shall be registered in such name or names and in such authorized denominations as the Representative may request in writing at least two full business days prior to the Closing Date. The Company will permit the Representative to examine and package the Firm Units for delivery, at least one full business day prior to the Closing Date. The Company shall not be obligated to sell or deliver the Firm Units except upon tender of payment by the Representative for all the Firm Units.

           1.1.3 Escrow of Underwriters’ Expense Allowance . On the Closing Date, the Underwriters agree to deposit into the Trust Fund three percent (3.0%) of the gross proceeds of the Offering (attributable to the non-accountable expense allowance) (the “Escrowed Fees” ) until the earlier of the completion of a Business Combination or the liquidation of the Trust Fund. Upon the consummation of a Business Combination, the Underwriters shall promptly receive the Escrowed Fees along with any interest accrued thereon. In the event that the Company is unable to consummate a Business Combination and Continental Stock Transfer & Trust Company, the trustee of the Trust Fund, is directed to liquidate the Trust Fund, the Underwriters hereby agree to the following: (i) forfeit any rights or claims to the Escrowed Fees and any interest accrued thereon; and (ii) that the Escrowed Fees shall be distributed on a pro-rata basis among the holders of the Public Securities (defined below) along with any interest accrued thereon.

     1.2 Over-Allotment Option .

          1.2.1 Option Units . For the purposes of covering any over-allotments in connection with the distribution and sale of the Firm Units, the Underwriters are hereby granted, severally and not jointly, an option to purchase up to an additional 1,474,500 units from the Company (the “ Over-allotment Option ”). Such additional 1,474,500 units are hereinafter referred to as “ Option Units .” The Firm Units and the Option Units are hereinafter collectively referred to as the “ Units ,” and the Units, the shares of Common Stock and the Warrants included in the Units and the shares of Common Stock issuable upon exercise of the Warrants are hereinafter referred to collectively as the “ Public Securities .” The purchase price to be paid for the Option Units will be the same price per Option Unit as the price per Firm Unit set forth in Section 1.1.1 hereof.

          1.2.2 Exercise of Option . The Over-allotment Option granted pursuant to Section 1.2.1 hereof may be exercised by the Representative as to all (at any time) or any part (from time to time) of the Option Units within 45 days after the Effective Date. The Underwriters will not be under any obligation to purchase any Option Units prior to the exercise of the Over-allotment Option. The Over-allotment Option granted hereby may be exercised by the giving of oral notice to the Company from the Representative, which must be confirmed in writing by overnight mail or facsimile transmission setting forth the number of Option Units to be purchased and the date and time for delivery of and payment for the Option Units, which will not be later than five full business days after the date of the notice or such other time as shall be agreed upon by the Company and the Representative, at the offices of the Representative or at such other place as shall be agreed upon by the Company and the Representative. If such delivery and payment for the Option Units does not occur on the Closing Date, the date and time of the closing for such Option Units will be as set forth in the notice (hereinafter the “ Option Closing Date ”). Upon exercise of the Over-allotment Option, the Company will become obligated to convey to the Underwriters, and, subject to the terms and conditions set forth herein, the Underwriters will become obligated to purchase, the number of Option Units specified in such notice.

          1.2.3 Payment and Delivery . Payment for the Option Units will be at the Representative’s election by wire transfer in Federal (same day) funds or by certified or bank cashier’s check(s) in Clearing House funds, payable to the Trust Fund at the offices of the Representative or at such other place as shall be agreed upon by the Representative and the Company upon delivery to you of certificates representing such securities (or through the facilities of DTC) for the account of the Underwriters. The certificates representing the Option Units to be delivered will be in such denominations and registered in such names as the Representative requests not less than two full business days prior to the Closing Date or the Option Closing Date, as the case may be, and will be made available

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to the Representative for inspection, checking and packaging at the aforesaid office of the Company’s transfer agent or correspondent not less than one full business day prior to such Closing Date.

     1.3 Representative’s Purchase Option .

          1.3.1 Purchase Option . The Company hereby agrees to issue and sell to the Representative (and/or their designees) on the Effective Date an option (“ Representative’s Purchase Option ”) for the purchase of an aggregate of 500,000 units (the “ Representative’s Units ”) for an aggregate purchase price of $100.00. Each of the Representative’s Units is identical to the Firm Units, except that the Warrants included in the Representative’s Units (“ Representatives Warrants ”) have an exercise price of $6.25 (125% of the exercise price of the Warrants included in the units sold to the public). The Representative’s Purchase Option shall be exercisable, in whole or in part, commencing on the later of the consummation of a Business Combination or one year from the Effective Date and expiring on the five-year anniversary of the Effective Date at an initial exercise price per Representative’s Unit of $7.50, which is equal to one hundred and twenty five percent (125%) of the initial public offering price of a Unit. The Representative’s Purchase Option, the Representative’s Units, the Warrants included in the Representative’s Units (the “ Representative’s Warrants ”) and the shares of Common Stock issuable upon exercise of the Representative’s Warrants are hereinafter referred to collectively as the “ Representative’s Securities .” The Public Securities and the Representative’s Securities are hereinafter referred to collectively as the “ Securities .” The Representative understands and agrees that there are significant restrictions against transferring the Representative’s Purchase Option during the first year after the Effective Date, as set forth in Section 3 of the Representative’s Purchase Option.

          1.3.2 Delivery and Payment . Delivery and payment for the Representative’s Purchase Option shall be made on the Closing Date. The Company shall deliver to the Underwriters, upon payment therefor, certificates for the Representative’s Purchase Option in the name or names and in such authorized denominations as the Underwriters may request.

2. Representations and Warranties of the Company . The Company represents and warrants to the Underwriters as follows:

     2.1 Filing of Registration Statement .

          2.1.1 Pursuant to the Act . The Company has filed with the Securities and Exchange Commission (“ Commission ”) a registration statement and an amendment or amendments thereto, on Form S-1 (File No. 333-124942), including any related preliminary prospectus (the “ Preliminary Prospectus ”), for the registration of the Public Securities under the Securities Act of 1933, as amended (“ Act ”), which registration statement and amendment or amendments have been prepared by the Company in conformity with the requirements of the Act, and the rules and regulations (“ Regulations ”) of the Commission under the Act. Except as the context may otherwise require, such registration statement, as amended, on file with the Commission at the time the registration statement becomes effective (including the prospectus, financial statements, schedules, exhibits and all other documents filed as a part thereof or incorporated therein and all information deemed to be a part thereof as of such time pursuant to paragraph (b) of Rule 430A of the Regulations), is hereinafter called the “ Registration Statement ,” and the form of the final prospectus dated the Effective Date included in the Registration Statement (or, if applicable, the form of final prospectus filed with the Commission pursuant to Rule 424 of the Regulations), is hereinafter called the “ Prospectus .” The Registration Statement has been declared effective by the Commission on the date hereof.

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          2.1.2 Pursuant to the Exchange Act . The Company has filed with the Commission a Form 8-A (File Number 000-___) providing for the registration under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), of the Units, the Common Stock and the Warrants. The registration of the Units, Common Stock and Warrants under the Exchange Act has been declared effective by the Commission on the date hereof.

     2.2 No Stop Orders, Etc. Neither the Commission nor, to the best of the Company’s knowledge, any state regulatory authority has issued any order preventing or suspending the use of any Preliminary Prospectus or has instituted or, to the best of the Company’s knowledge, threatened to institute any proceedings with respect to such an order.

     2.3 Disclosures in Registration Statement .

          2.3.1 10b-5 Representation . At the time the Registration Statement becomes effective and at all times subsequent thereto up to the Closing Date and the Option Closing Date, if any, the Registration Statement and the Prospectus will contain all material statements that are required to be stated therein in accordance with the Act and the Regulations, and will in all material respects conform to the requirements of the Act and the Regulations; neither the Registration Statement nor the Prospectus, nor any amendment or supplement thereto, on such dates, will contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. When any Preliminary Prospectus was first filed with the Commission (whether filed as part of the Registration Statement for the registration of the Securities or any amendment thereto or pursuant to Rule 424(a) of the Regulations) and when any amendment thereof or supplement thereto was first filed with the Commission, such Preliminary Prospectus and any amendments thereof and supplements thereto complied or will comply in all material respects with the applicable provisions of the Act and the Regulations and did not and will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The representation and warranty made in this Section 2.3.1 does not apply to statements made or statements omitted in reliance upon and in conformity with written information furnished to the Company with respect to the Underwriters by the Representative expressly for use in the Registration Statement or Prospectus or any amendment thereof or supplement thereto.

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          2.3.2 Disclosure of Agreements . The agreements and documents described in the Registration Statement and the Prospectus conform to the descriptions thereof contained therein and there are no agreements or other documents required to be described in the Registration Statement or the Prospectus or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by which its property or business is or may be bound or affected and (i) that is referred to in the Prospectus, or (ii) is material to the Company’s business, has been duly and validly executed by the Company, is in full force and effect in all material respects and is enforceable against the Company and, to the Company’s knowledge, the other parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (y) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought, and none of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the best of the Company’s knowledge, any other party is in default thereunder and, to the best of the Company’s knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder. To the best of the Company’s knowledge, performance by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation, those relating to environmental laws and regulations.

          2.3.3 Prior Securities Transactions . No securities of the Company have been sold by the Company or by or on behalf of, or for the benefit of, any person or persons controlling, controlled by, or under common control with the Company within the three years prior to the date hereof, except as disclosed in the Registration Statement.

          2.3.4 Regulations . The disclosures in the Registration Statement concerning the effects of Federal, State and local regulation and any foreign regulation on the Company’s business as currently contemplated are correct in all material respects and do not omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.

     2.4 Changes After Dates in Registration Statement .

          2.4.1 No Material Adverse Change . Since the respective dates as of which information is given in the Registration Statement and the Prospectus, except as otherwise specifically stated therein: (i) there has been no material adverse change in the condition, financial or otherwise, or business prospects of the Company; (ii) there have been no material transactions entered into by the Company, other than as contemplated pursuant to this Agreement; and (iii) no member of the Company’s management has resigned from any position with the Company.

          2.4.2 Recent Securities Transactions, Etc. Subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, and except as may otherwise be indicated or contemplated herein or therein, the Company has not: (i) issued any securities or incurred any liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other distribution on or in respect to its capital stock.

     2.5 Independent Accountants . To the knowledge of the Company, Goldstein Golub Kessler LLP (“ GGK ”), whose report is filed with the Commission as part of the Registration Statement, are independent accountants as required by the Act and the Regulations. GGK has not, during the periods

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covered by the financial statements included in the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act.

     2.6 Financial Statements . The financial statements, including the notes thereto and supporting schedules included in the Registration Statement and Prospectus fairly present the financial position and the results of operations of the Company at the dates and for the periods to which they apply; and such financial statements have been prepared in conformity with generally accepted accounting principles, consistently applied throughout the periods involved; and the supporting schedules included in the Registration Statement present fairly the information required to be stated therein. The Registration Statement discloses all material off-balance sheet transactions, arrangements, obligations (including contingent obligations), and other relationships of the Company with unconsolidated entities or other persons that may have a material current or future effect on the Company’s financial condition, changes in financial condition, results of operations, liquidity, capital expenditures, capital resources, or significant components of revenues or expenses.

     2.7 Authorized Capital; Options, Etc. The Company had at the date or dates indicated in the Prospectus duly authorized, issued and outstanding capitalization as set forth in the Registration Statement and the Prospectus. Based on the assumptions stated in the Registration Statement and the Prospectus, the Company will have on the Closing Date the adjusted stock capitalization set forth therein. Except as set forth in, or contemplated by, the Registration Statement and the Prospectus, on the Effective Date and on the Closing Date, there will be no options, warrants, or other rights to purchase or otherwise acquire any authorized, but unissued shares of Common Stock of the Company or any security convertible into shares of Common Stock of the Company, or any contracts or commitments to issue or sell shares of Common Stock or any such options, warrants, rights or convertible securities.

     2.8 Valid Issuance of Securities, Etc.

          2.8.1 Outstanding Securities . All issued and outstanding securities of the Company have been duly authorized and validly issued and are fully paid and non-assessable; the holders thereof have no rights of rescission with respect thereto, and are not subject to personal liability by reason of being such holders; and none of such securities were issued in violation of the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. The authorized Common Stock conforms to all statements relating thereto contained in the Registration Statement and the Prospectus. The offers and sales of the outstanding Common Stock were at all relevant times either registered under the Act and the applicable state securities or Blue Sky laws or, based in part on the representations and warranties of the purchasers of such shares of Common Stock, exempt from such registration requirements.

          2.8.2 Securities Sold Pursuant to this Agreement . The Securities have been duly authorized and, when issued and paid for, will be validly issued, fully paid and non-assessable; the holders thereof are not and will not be subject to personal liability by reason of being such holders; the Securities are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company; and all corporate action required to be taken for the authorization, issuance and sale of the Securities has been duly and validly taken. The Securities conform in all material respects to all statements with respect thereto contained in the Registration Statement. When issued, the Representative’s Purchase Option, the Representative’s Warrants and the Warrants will constitute valid and binding obligations of the Company to issue and sell, upon exercise thereof and payment of the respective exercise prices therefor, the number and type of securities of the Company called for thereby in accordance with the terms thereof and such Representative’s Purchase Option, the Representative’s Warrants and the Warrants are enforceable against the Company in accordance with their respective terms, except: (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of any indemnification or contribution provision may be limited under the federal and

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state securities laws; and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

     2.9 Registration Rights of Third Parties . Except as set forth in the Prospectus, no holders of any securities of the Company or any rights exercisable for or convertible or exchangeable into securities of the Company have the right to require the Company to register any such securities of the Company under the Act or to include any such securities in a registration statement to be filed by the Company.

     2.10 Validity and Binding Effect of Agreements . This Agreement, the Warrant Agreement (as defined in Section 2.21 hereof), the Trust Agreement, the Services Agreement (as defined in Section 3.7.2 hereof), the Advisory Agreement (as defined in Section 2.25 hereof) and the Escrow Agreement (as defined in Section 2.22.2 hereof) have been duly and validly authorized by the Company and constitute, and the Representative’s Purchase Option, has been duly and validly authorized by the Company and, when executed and delivered, will constitute, the valid and binding agreements of the Company, enforceable against the Company in accordance with their respective terms, except: (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws; and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

     2.11 No Conflicts, Etc. The execution, delivery, and performance by the Company of this Agreement, the Warrant Agreement, the Representative’s Purchase Option, the Trust Agreement, the Advisory Agreement, the Service Agreement and the Escrow Agreement, the consummation by the Company of the transactions herein and therein contemplated and the compliance by the Company with the terms hereof and thereof do not and will not, with or without the giving of notice or the lapse of time or both: (i) result in a material breach of, or conflict with any of the terms and provisions of, or constitute a material default under, or result in the creation, modification, termination or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any agreement or instrument to which the Company is a party except pursuant to the Trust Agreement referred to in Section 2.23 hereof; (ii) result in any violation of the provisions of the Articles of Incorporation or the By-Laws of the Company; or (iii) violate any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its properties or business constituted as of the date hereof.

     2.12 No Defaults; Violations . No default exists in the due performance and observance of any term, covenant or condition of any material license, contract, indenture, mortgage, deed of trust, note, loan or credit agreement, or any other agreement or instrument evidencing an obligation for borrowed money, or any other material agreement or instrument to which the Company is a party or by which the Company may be bound or to which any of the properties or assets of the Company is subject. The Company is not in violation of any term or provision of its Articles of Incorporation, as may be amended from time to time, or Bylaws or in violation of any franchise, license, permit, applicable law, rule, regulation, judgment or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its properties or businesses.

2.13 Corporate Power; Licenses; Consents.

          2.13.1 Conduct of Business . Except as described in the Prospectus, the Company has all requisite corporate power and authority, and has all necessary authorizations, approvals, orders, licenses, certificates and permits of and from all governmental regulatory officials and bodies that it needs as of the date hereof to conduct its business purpose as described in the Prospectus. The disclosures in the Registration Statement concerning the effects of federal, state, local and foreign regulation on this

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offering and the Company’s business purpose as currently contemplated are correct in all material respects and do not omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

          2.13.2 Transactions Contemplated Herein . The Company has all corporate power and authority to enter into this Agreement and to carry out the provisions and conditions hereof, and all consents, authorizations, approvals and orders required in connection therewith have been obtained. No consent, authorization or order of, and no filing with, any court, government agency or other body is required for the valid issuance, sale and delivery, of the Securities and the consummation of the transactions and agreements contemplated by this Agreement, the Warrant Agreement, the Representative’s Purchase Option, the Trust Agreement, the Services Agreement, the Advisory Agreement and the Escrow Agreement and as contemplated by the Prospectus, except with respect to applicable federal and state securities laws.

     2.14 D&O Questionnaires . To the Company’s knowledge, all information contained in the questionnaires (the “ Questionnaires ”) completed by each of the Company’s stockholders immediately prior to the Offering (the “ Initial Stockholders ”) and provided to the Underwriters as an exhibit to his or her Insider Letter (as defined in Section 2.22.1) is true and correct in all respects and the Company has not become aware of any information which would cause the information disclosed in the questionnaires completed by each Initial Stockholder to become inaccurate and incorrect.

     2.15 Litigation; Governmental Proceedings . There is no action, suit, proceeding, inquiry, arbitration, investigation, litigation or governmental proceeding pending or, to the Company’s knowledge, threatened against, or involving the Company or, to the Company’s knowledge, any Initial Stockholder which has not been disclosed in the Registration Statement or the Questionnaires.

     2.16 Good Standing . The Company has been duly organized and is validly existing as a corporation and is in good standing under the laws of its state of incorporation as of the date hereof, and is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction in which its ownership or lease of property or the conduct of business requires such qualification.

     2.17 Stop Orders . The Commission has not issued any order preventing or suspending the use of any Preliminary Prospectus or Prospectus or any part thereof.

     2.18 Transactions Affecting Disclosure to NASD .

          2.18.1 Finder’s Fees . Except as described in the Prospectus, there are no claims, payments, arrangements, agreements or understandings relating to the payment of a finder’s, consulting or origination fee by the Company or any Initial Stockholder with respect to the sale of the Securities hereunder or any other arrangements, agreements or understandings of the Company or, to the Company’s knowledge, any Initial Stockholder that may affect the Underwriters’ compensation, as determined by the National Association of Securities Dealers, Inc. (the “ NASD ”).

          2.18.2 Payments Within Twelve Months . The Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who raised or provided capital to the Company; (ii) to any NASD member; or (iii) to any person or entity that has any direct or indirect affiliation or association with any NASD member, within the twelve months prior to the Effective Date, other than payments to FBW.

          2.18.3 Use of Proceeds . None of the net proceeds of the Offering will be paid by the Company to any participating NASD member or its affiliates, except as specifically authorized herein and except as may be paid in connection with a Business Combination as contemplated by the Prospectus.

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          2.18.4 Initial Stockholders’ NASD Affiliation . Based on questionnaires distributed to such persons, no officer, director or any beneficial owner of the Company’s unregistered securities has any direct or indirect affiliation or association with any NASD member. The Company will advise the Representative and its counsel if it learns that any officer, director or owner of at least 5% of the Company’s outstanding Common Shares is or becomes an affiliate or associated person of an NASD member participating in the offering.

     2.19 Foreign Corrupt Practices Act . Neither the Company nor any of the Initial Stockholders or any other person acting on behalf of the Company has, directly or indirectly, given or agreed to give any money, gift or similar benefit (other than legal price concessions to customers in the ordinary course of business) to any customer, supplier, employee or agent of a customer or supplier, or official or employee of any governmental agency or instrumentality of any government (domestic or foreign) or any political party or candidate for office (domestic or foreign) or any political party or candidate for office (domestic or foreign) or other person who was, is, or may be in a position to help or hinder the business of the Company (or assist it in connection with any actual or proposed transaction) that (i) might subject the Company to any damage or penalty in any civil, criminal or governmental litigation or proceeding, (ii) if not given in the past, might have had a material adverse effect on the assets, business or operations of the Company as reflected in any of the financial statements contained in the Prospectus or (iii) if not continued in the future, might adversely affect the assets, business, operations or prospects of the Company. The Company’s internal accounting controls and procedures are sufficient to cause the Company to comply with the Foreign Corrupt Practices Act of 1977, as amended.

     2.20. Officers’ Certificate . Any certificate signed by any duly authorized officer of the Company and delivered to you or to your counsel shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.

     2.21 Warrant Agreement . The Company has entered into a warrant agreement with respect to the Warrants and the Representative’s Warrants with Continental Stock Transfer & Trust Company substantially in the form filed as an exhibit to the Registration Statement (the “ Warrant Agreement ”).

     2.22 Agreements With Initial Stockholders .

          2.22.1 Insider Letters . The Company has caused to be duly executed legally binding and enforceable agreements (except (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (ii) as enforceability of any indemnification, contribution or noncompete provision may be limited under the federal and state securities laws, and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought) annexed as Exhibits 10.1, 10.2, 10.3, 10.11, 10.12, 10.13 and 10.14, to the Registration Statement (the “ Insider Letter ”), pursuant to which each of the Initial Stockholders of the Company agree to certain matters, including but not limited to, certain matters described as being agreed to by them under the “Proposed Business” Section of the Prospectus.

          2.22.2 Escrow Agreement . The Company has caused the Initial Stockholders to enter into an escrow agreement (the “ Escrow Agreement ”) with Continental Stock Transfer & Trust Company (the “ Escrow Agent ”) in form and substance satisfactory to the Underwriters, whereby the Common Stock owned by the Initial Stockholders will be held in escrow by the Escrow Agent, until six months after the consummation of a Business Combination. During such escrow period, the Initial Stockholders shall be prohibited from selling or otherwise transferring such shares (except to spouses and children of Initial Stockholders and trusts established for their benefit and as otherwise set forth in the Escrow Agreement), but will retain the right to vote such shares. The Escrow Agreement shall not be amended, modified or otherwise changed without the prior written consent of FBW.

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     2.23 Investment Management Trust Agreement . The Company has entered into the Trust Agreement with respect to certain proceeds of the Offering in form and substance satisfactory to the Underwriters.

     2.24 Covenants Not to Compete . No Initial Stockholder of the Company is subject to any noncompetition agreement with any employer or prior employer which could materially affect his ability to be an Initial Stockholder, employee, officer and/or director of the Company.

     2.25 Financial Advisory Agreement . The Company has entered into an Amended and Restated Financial Advisory Agreement with the Representative (the “ Advisory Agreement ”), in form and substance satisfactory to the Representative, whereby FBW, and SG Americas Securities, LLC, one of the participating underwriters in the offering, will serve as our financial advisors in connection with a Business Combination for a period of two years from the effective date of this offering.

     2.26 Investments . No more than 45% of the “value” (as defined in Section 2(a)(41) of the Investment Company Act of 1940 (the “ Investment Company Act ”)) of the Company’s total assets consist of, and no more than 45% of the Company’s net income after taxes is derived from, securities other than “Government securities” (as defined in Section 2(a)(16) of the Investment Company Act).

     2.27 Subsidiaries . The Company does not own an interest in any corporation, partnership, limited liability company, joint venture, trust or other business entity.

     2.28 Related Party Transactions . There are no business relationships or related party transactions involving the Company or any other person required to be described in the Prospectus that have not been described as required.

     2.29 Board of Directors. The Board of Directors of the Company is comprised of the persons set forth on Schedule 2.29. The qualifications of the persons serving as Board members and the overall composition of the Board comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder. At least one member of the Board qualifies as a “financial expert” as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder.

     2.30 Sarbanes-Oxley Compliance.

               2.30.1 Disclosure Controls. The Company has developed and currently maintains disclosure controls and procedures that will comply with Rule 13a-15 or 15d-15 of the Exchange Act, and such controls and procedures are effective to ensure that all material information concerning the Company will be made known on a timely basis to the individuals responsible for the preparation of the Company’s Exchange Act filings and other public disclosure documents.

               2.30.2 Compliance. The Company and each of its directors and its senior financial officers has consulted with the Company’s independent auditors and outside counsel with respect to, and is familiar in all material respects with, the requirements of the Sarbanes-Oxley Act of 2002. The Company is in, or will be on the Effective Date, compliance with the provisions of the Sarbanes-Oxley Act of 2002 applicable to it, and has implemented or will implement such programs and taken reasonable steps to ensure the Company’s future compliance (not later than the relevant statutory and regulatory deadlines therefore) with all the provisions of the Sarbanes-Oxley Act of 2002.

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3. Covenants of the Company . The Company covenants and agrees as follows:

     3.1 Amendments to Registration Statement . The Company will deliver to the Representative, prior to filing, any amendment or supplement to the Registration Statement or Prospectus proposed to be filed after the Effective Date and not file any such amendment or supplement to which the Representative shall reasonably object in writing.

     3.2 Federal Securities Laws .

          3.2.1 Compliance . During the time when a Prospectus is required to be delivered under the Act, the Company will use its best efforts to comply with all requirements imposed upon it by the Act, the Regulations and the Exchange Act and by the regulations under the Exchange Act, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Public Securities in accordance with the provisions hereof and the Prospectus. If at any time when a Prospectus relating to the Public Securities is required to be delivered under the Act, any event shall have occurred as a result of which, in the opinion of counsel for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Act, the Company will notify the Representative promptly and prepare and file with the Commission, subject to Section 3.1 hereof, an appropriate amendment or supplement in accordance with Section 10 of the Act.

          3.2.2 Filing of Final Prospectus . The Company will file the Prospectus (in form and substance satisfactory to the Representative) with the Commission pursuant to the requirements of Rule 424 of the Regulations.

          3.2.3 Exchange Act Registration . For a period of five years from the Effective Date, or until such earlier time upon which the Company is required to be liquidated, the Company will use its best efforts to maintain the registration of the Units, Common Stock and Warrants under the provisions of the Exchange Act. The Company will not deregister the Units under the Exchange Act without the prior written consent of FBW.

     3.3 Blue Sky Filing . The Company will endeavor in good faith, in cooperation with the Representative, at or prior to the time the Registration Statement becomes effective, to qualify the Public Securities for offering and sale under the securities laws of such jurisdictions as the Representative may reasonably designate, provided that no such qualification shall be required in any jurisdiction where, as a result thereof, the Company would be subject to service of general process or to taxation as a foreign corporation doing business in such jurisdiction. In each jurisdiction where such qualification shall be effected, the Company will, unless the Representative agrees that such action is not at the time necessary or advisable, use all reasonable efforts to file and make such statements or reports at such times as are or may be required by the laws of such jurisdiction.

     3.4 Delivery to Underwriters of Prospectuses . The Company will deliver to each of the several Underwriters, without charge, from time to time during the period when the Prospectus is required to be delivered under the Act or the Exchange Act such number of copies of each Preliminary Prospectus and the Prospectus as such Underwriters may reasonably request and, as soon as the Registration Statement or any amendment or supplement thereto becomes effective, deliver to you two original executed Registration Statements, including exhibits, and all post-effective amendments thereto and copies of all exhibits filed therewith or incorporated therein by reference and all original executed consents of certified experts.

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     3.5 Effectiveness and Events Requiring Notice to the Representative . The Company will use its best efforts to cause the Registration Statement to remain effective and will notify the Representative immediately and confirm the notice in writing: (i) of the effectiveness of the Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Public Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the period described in Section 3.4 hereof that, in the judgment of the Company, makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the Prospectus in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state securities commission shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort to obtain promptly the lifting of such order.

     3.6 Review of Financial Statements . For a period of five years from the Effective Date, or until such earlier upon which the Company is required to be liquidated, the Company, at its expense, shall cause its regularly engaged independent certified public accountants to review (but not audit) the Company’s financial statements for each of the first three fiscal quarters prior to the announcement of quarterly financial information, the filing of the Company’s Form 10-Q quarterly report and the mailing of quarterly financial information to stockholders.

     3.7 Transactions .

          3.7.1 Business Combinations . The Company will not consummate a Business Combination with any entity which is affiliated with any Initial Stockholder unless the Company obtains an opinion from an independent investment banking firm that the Business Combination is fair to the Company’s stockholders from a financial perspective.

          3.7.2 Administrative Services . The Company has entered into an agreement (the “ Services Agreement ”) with Integrated Global Networks, LLC (the “ Provider ”), pursuant to which the Provider will make available to the Company general and administrative services including office space, utilities and secretarial support for an amount equal to $4,000.00 per month.

          3.7.3 Affiliate Compensation . The Company shall not pay any Initial Stockholder or any of their affiliates any fees or compensation from the Company, for services rendered to the Company prior to, or in connection with, the consummation of a Business Combination; provided that the Initial Stockholders shall be entitled to reimbursement from the Company for their out-of-pocket expenses incurred in connection with seeking and consummating a Business Combination.

     3.8 Secondary Market Trading and Standard & Poor’s . The Company will apply to be included in Standard and Poor’s Daily News and Corporation Records Corporate Descriptions for a period of five years from the consummation of a Business Combination. Promptly after the consummation of the Offering, the Company shall take such steps as may be necessary to obtain a secondary market trading exemption for the Company’s securities in the State of California. The Company shall also take such other action as may be reasonably requested by the Representative to obtain a secondary market trading exemption in such other states as may be requested by the Representative.

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      3.9 Intentionally omitted.

     3.10 Financial Public Relations Firm . Promptly after the execution of a definitive agreement for a Business Combination, the Company shall retain a financial public relations firm reasonably acceptable to the Representative for a term to be agreed upon by the Company and the Representative.

     3.11 Reports to the Representative .

          3.11.1 Periodic Reports, Etc. For a period of five years from the Effective Date or until such earlier time upon which the Company is required to be liquidated, the Company will furnish to the Representative (Attn: Scott Bass, Vice President ) and its counsel copies of such financial statements and other periodic and special reports as the Company from time to time (if not readily available via the EDGAR service) furnishes generally to holders of any class of its securities, and promptly furnish to the Representative: (i) a copy of each periodic report the Company shall be required to file with the Commission; (ii) a copy of every press release and every news item and article with respect to the Company or its affairs which was released by the Company; (iii) copies of each Form SR; (iv) a copy of each Form 8-K or Schedules 13D, 13G, 14D-1 or 13E-4 received or prepared by the Company; (v) five copies of each Registration Statement; (vi) a copy of monthly statements, if any, setting forth such information regarding the Company’s results of operations and financial position (including balance sheet, profit and loss statements and data regarding outstanding purchase orders) as is regularly prepared by management of the Company; and (vii) such additional documents and information with respect to the Company and the affairs of any future subsidiaries of the Company as the Representative may from time to time reasonably request.

          3.11.2 Transfer Sheets . For a period of five years following the Effective Date or until such earlier time upon which the Company is required to be liquidated, the Company shall retain a transfer and warrant agent acceptable to the Representative (the “ Transfer Agent ”) and will furnish to the Underwriters at the Company’s sole cost and expense such transfer sheets of the Company’s securities as the Representative may request, including the daily and monthly consolidated transfer sheets of the Transfer Agent and DTC. Continental Stock Transfer & Trust Company is acceptable to the Underwriters.

          3.11.3 Secondary Market Trading Survey . Until such time as the Public Securities are listed or quoted, as the case may be, on the New York Stock Exchange, the American Stock Exchange or quoted on the Nasdaq National Market, or until such earlier time upon which the Company is required to be liquidated, the Company shall engage Gersten Savage LLP (“ Gersten Savage ”), for a one-time fee of $5,000 payable on the Closing Date, to deliver and update to the Underwriters on a timely basis, but in any event on the Effective Date and at the beginning of each fiscal quarter, a written report detailing those states in which the Public Securities may be traded in non-issuer transaction under the Blue Sky laws of the fifty States (the “ Secondary Market Trading Survey ”).

          3.11.4 Trading Reports . During such time as the Public Securities are listed on the American Stock Exchange (the “AMEX”), the Company shall provide to the Representative, at its expense, such reports published by the AMEX relating to price trading of the Public Securities, as the Representative shall reasonably request.

     3.12 Disqualification of Form S-1 . For a period equal to seven years from the date hereof, the Company will not take any action or actions which may prevent or disqualify the Company’s use of Form S-1 (or other appropriate form) for the registration of the Warrants and the Representative’s Warrants under the Act.

     3.13 Payment of Expenses .

          3.13.1 General Expenses Related to the Offering . The Company hereby agrees to pay on each of the Closing Date and the Option Closing Date, if any, to the extent not paid at Closing Date,

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all expenses incident to the performance of the obligations of the Company under this Agreement, including, but not limited to: (i) the preparation, printing, filing and mailing (including the payment of postage with respect to such mailing) of the Registration Statement, the Preliminary and final Prospectuses and the printing and mailing of this Agreement and related documents, including the cost of all copies thereof and any amendments thereof or supplements thereto supplied to the Underwriters in quantities as may be required by the Underwriters; (ii) the printing, engraving, issuance and delivery of the Units, the shares of Common Stock and the Warrants included in the Units and the Representative’s Purchase Option, including any transfer or other taxes payable thereon; (iii) the qualification of the Public Securities under state or foreign securities or Blue Sky laws, including the costs of printing and mailing the “Preliminary Blue Sky Memorandum,” and all amendments and supplements thereto, fees and disbursements for the Representative’s counsel retained for such purpose (such fees shall be capped at $35,000 in the aggregate, of which $10,000 has previously been paid), and a one-time fee of $5,000 payable to the Representative’s counsel for the preparation of the Secondary Market Trading Survey; (iv) filing fees, costs and expenses (including disbursements for the Representative’s counsel) incurred in registering the Offering with the NASD; (v) costs of placing “tombstone” advertisements in The Wall Street Journal , The New York Times and a third publication to be selected by the Representative; (vi) fees and disbursements of the transfer and warrant agent; (vii) the preparation, binding and delivery of transaction “bibles,” in form and style reasonably satisfactory to the Representative and transaction lucite cubes or similar commemorative items in a style and quantity as reasonably requested by the Representative; and (viii) all other costs and expenses incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this Section 3.13.1. The Company also agrees that, if requested by the Representative, it will engage an investigative search firm of the Representative’s choice to conduct an investigation of the principals of the Company as shall be mutually selected by the Representative and the Company. The Representative may deduct from the net proceeds of the Offering payable to the Company on the Closing Date, or the Option Closing Date, if any, the expenses set forth herein to be paid by the Company to the Representative and others. If the Company elects not to proceed with the Offering contemplated by this Agreement, then the Company shall reimburse the Underwriters in full for their out of pocket accountable expenses actually incurred by the Underwriters, including, without limitation, its legal fees (up to a maximum of $50,000) and disbursements.

          3.13.2 Nonaccountable Expenses . The Company further agrees that, in addition to the expenses payable pursuant to Section 3.13.1, on each of the Closing Date, it will pay to the Representative a nonaccountable expense allowance equal to three percent (3.0%) of the gross proceeds received by the Company from the sale of the Firm Units by deduction from the proceeds of the Offering contemplated herein.

          3.13.3 Expenses Related to Business Combination . The Company further agrees that, in the event the Representative assists the Company in trying to obtain approval of a proposed Business Combination, the Company agrees to reimburse the Representative for all out-of-pocket expenses, including, but not limited to, “road-show” and due diligence expenses.

     3.14 Application of Net Proceeds . The Company will apply the net proceeds from the Offering received by it in a manner consistent with the application described under the caption “Use Of Proceeds” in the Prospectus.

     3.15 Delivery of Earnings Statements to Security Holders . The Company will make generally available to its security holders as soon as practicable, but not later than the first day of the fifteenth full calendar month following the Effective Date, an earnings statement (which need not be certified by independent public or independent certified public accountants unless required by the Act or the Regulations, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Act) covering a period of at least twelve consecutive months beginning after the Effective Date.

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     3.16 Notice to NASD . In the event any person or entity (regardless of any NASD affiliation or association), other than FBW, is engaged to assist the Company in its search for a merger candidate or to provide any other merger and acquisition services, the Company will provide the following to the NASD prior to the consummation of the Business Combination: (i) complete details of all services and copies of agreements governing such services; and (ii) justification as to why the person or entity providing the merger and acquisition services should not be considered an “underwriter and related person” with respect to the Company’s initial public offering, as such term is defined in Rule 2710 of the NASD’s Conduct Rules. The Company also agrees that proper disclosure of such arrangement or potential arrangement will be made in the proxy statement which the Company will file for purposes of soliciting stockholder approval for the Business Combination.

     3.17 Stabilization . Except with respect to the agreement between Ram Mukunda and the Representative annexed as Exhibit 10.8 to the Registration Statement, neither the Company, nor, to its knowledge, any of its employees, directors or stockholders (without the consent of FBW) has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Units.

     3.18 Internal Controls . The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with generally accepted accounting principles and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

     3.19 Accountants . For a period of five years from the Effective Date or until such earlier time upon which the Company is required to be liquidated, the Company shall retain GGK or other independent public accountants reasonably acceptable to FBW.

     3.20 Form 8-K . The Company shall, on the date hereof, retain its independent public accountants to audit the financial statements of the Company as of the Closing Date (the “ Audited Financial Statements ”) reflecting the receipt by the Company of the proceeds of the initial public offering. As soon as the Audited Financial Statements become available, the Company shall immediately file a Current Report on Form 8-K with the Commission, which Report shall contain the Company’s Audited Financial Statements.

     3.21 NASD . The Company shall advise the NASD if it is aware that any 5% or greater stockholder of the Company becomes an affiliate or associated person of an NASD member participating in the distribution of the Company’s Public Securities.

     3.22 Corporate Proceedings . All corporate proceedings and other legal matters necessary to carry out the provisions of this Agreement and the transactions contemplated hereby shall have been done to the reasonable satisfaction to counsel for the Underwriters.

     3.23 Investment Company . The Company shall cause the proceeds of the Offering to be held in the Trust Fund to be invested only in “government securities” with specific maturity dates as set forth in the Trust Agreement and disclosed in the Prospectus. The Company will otherwise conduct its business in a manner so that it will not become subject to the Investment Company Act. Furthermore, once the Company consummates a Business Combination, it will be engaged in a business other than that of investing, reinvesting, owning, holding or trading securities.

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     3.24 Investment Banking Engagement . Pursuant to the Advisory Agreement, the Company hereby engages FBW as its investment banker in connection with the Company’s Business Combination to provide the Company with assistance in structuring the Business Combination and negotiating its terms.

          3.24.1 Compensation . As compensation for the foregoing services, the Company will pay FBW a cash fee at the closing of a Business Combination equal to 2% of the aggregate consideration paid in such Business Combination.

          3.24.2 Payment . All fees payable under Section 3.24.1 are due and payable to FBW, by certified check or wire transfer, at the closing of the Business Combination.

          3.24.3 Business Combination Announcement . Within five business days following the consummation by the Company of a Business Combination, the Company shall cause an announcement (“ Business Combination Announcement ”) to be placed, at its cost, in The Wall Street Journal. Such announcement shall describe the consummation of the Business Combination and indicate that the Representative was the managing underwriter in the Offering and advisor in connection with the Business Combination. The Company shall supply the Representative with a draft of the Business Combination Announcement and provide the Representative with a reasonable opportunity to comment thereon. The Company will not place the Business Combination Announcement without the final approval of the Representative.

     3.25 Colorado Trust Filing . In the event the Securities are registered in the State of Colorado, the Company will cause a Colorado Form ES to be filed with the Commissioner of the State of Colorado no less than 10 days prior to the distribution of the Trust Fund in connection with a Business Combination and will do all things necessary to comply with Section 11-51-302 and Rule 51-3.4 of the Colorado Securities Act.

     3.26 No Fiduciary Duties . The Company acknowledges and agrees that the Underwriters’ responsibility to the Company is solely contractual in nature and that none of the Underwriters or their affiliates shall be acting in a fiduciary capacity, or otherwise owe any fiduciary duty to the company in connection with the Offering and the other transactions contemplated by this Agreement.

4. Conditions of Underwriters’ Obligations . The obligations of the several Underwriters to purchase and pay for the Units, as provided herein, shall be subject to the continuing accuracy of the representations and warranties of the Company as of the date hereof and as of each of the Closing Date and the Option Closing Date, if any, to the accuracy of the statements of officers of the Company made pursuant to the provisions hereof and to the performance by the Company of its obligations hereunder and to the following conditions:

     4.1 Regulatory Matters .

          4.1.1 Effectiveness of Registration Statement . The Registration Statement shall have become effective not later than 5:00 P.M., Baltimore time, on the date of this Agreement or such later date and time as shall be consented to in writing by you, and, at each of the Closing Date and the Option Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for the purpose shall have been instituted or shall be pending or contemplated by the Commission and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of Gersten Savage.

          4.1.2 NASD Clearance . By the Effective Date, the Representative shall have received clearance from the NASD as to the amount of compensation allowable or payable to the Underwriters as described in the Registration Statement.

          4.1.3 No Blue Sky Stop Orders . No order suspending the sale of the Units in any jurisdiction designated by you pursuant to Section 3.3 hereof shall have been issued on either on the

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Closing Date or the Option Closing Date, and no proceedings for that purpose shall have been instituted or shall be contemplated.

     4.2 Company Counsel Matters .

          4.2.1 Effective Date Opinion of Counsel . On the Effective Date, the Representative shall have received the favorable opinion of Seyfarth Shaw LLP (“ Seyfarth ”), counsel to the Company, dated the Effective Date, addressed to the Representative and in form and substance satisfactory to the Representative to the effect that:

               (i) The Company has been duly organized and is validly existing as a corporation and is in good standing under the laws of its state of incorporation. The Company is duly qualified and licensed and in good standing as a foreign corporation in each jurisdiction in which its ownership or leasing of any properties or the character of its operations requires such qualification or licensing, except where the failure to qualify would not have a material adverse effect on the Company.

               (ii) All issued and outstanding securities of the Company have been duly authorized and validly issued and are fully paid and non-assessable; the holders thereof are not subject to personal liability by reason of being such holders; and none of such securities were issued in violation of the preemptive rights of any stockholder of the Company arising by operation of law or under the Articles of Incorporation or Bylaws of the Company. The offers and sales of the outstanding Common Stock were at all relevant times either registered under the Act and the applicable state securities or Blue Sky Laws or exempt from such registration requirements. The authorized and outstanding capital stock of the Company is as set forth in the Prospectus.

               (iii) The Securities have been duly authorized and, when issued and paid for, will be validly issued, fully paid and non-assessable; the holders thereof are not and will not be subject to personal liability by reason of being such holders. The Securities are not and will not be subject to the preemptive rights of any holders of any security of the Company arising by operation of law or under the Articles of Incorporation or Bylaws of the Company. When issued, the Representative’s Purchase Option, the Representative’s Warrants and the Warrants will constitute valid and binding obligations of the Company to issue and sell, upon exercise thereof and payment therefor, the number and type of securities of the Company called for thereby and such Warrants, the Representative’s Purchase Option, and the Representative’s Warrants, when issued, in each case, are enforceable against the Company in accordance with their respective terms, except: (a) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (b) as enforceability of any indemnification or contribution provision may be limited under the United States and state securities laws; and (c) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. The certificates representing the Securities are in due and proper form.

               (iv) This Agreement, the Warrant Agreement, the Services Agreement, the Trust Agreement, Advisory Agreement and the Escrow Agreement have each been duly and validly authorized and, when executed and delivered by the Company, constitute, and the Representative’s Purchase Option has been duly and validly authorized by the Company and, when executed and delivered, will constitute, the valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except: (a) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (b) as enforceability of any indemnification or contribution provisions may be limited under the United States and state securities laws; and (c) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

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               (v) The execution, delivery and performance of this Agreement, the Warrant Agreement, the Representative’s Purchase Option, the Escrow Agreement, Advisory Agreement, the Trust Agreement and the Services Agreement, the issuance and sale of the Securities, the consummation of the transactions contemplated hereby and thereby, and compliance by the Company with the terms and provisions hereof and thereof, do not and will not, with or without the giving of notice or the lapse of time, or both, (a) to such counsel’s knowledge, conflict with, or result in a breach of, any of the terms or provisions of, or constitute a default under, or result in the creation or modification of any lien, security interest, charge or encumbrance upon any of the properties or assets of the Company pursuant to the terms of, any mortgage, deed of trust, note, indenture, loan, contract, commitment or other agreement or instrument filed as an exhibit to the Registration Statement, (b) result in any violation of the provisions of the Articles of Incorporation or the By-Laws of the Company, or (c) to such counsel’s knowledge, violate any statute or any judgment, order or decree, rule or regulation applicable to the Company of any court, domestic or foreign, or of any federal, state or other regulatory authority or other governmental body having jurisdiction over the Company, its properties or assets.

               (vi) The Registration Statement, each Preliminary Prospectus and the Prospectus and any post-effective amendments or supplements thereto (other than the financial statements included therein, as to which no opinion need be rendered) each as of their respective dates complied as to form in all material respects with the requirements of the Act and Regulations. The Securities conform in all material respects to the description thereof contained in the Registration Statement and the Prospectus. No United States or state statute or regulation required to be described in the Prospectus is not described as required (except as to the Blue Sky laws of the various states, as to which such counsel expresses no opinions), nor are any contracts or documents of a character required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement not so described or filed as required (except for the contracts and documents described in the “Underwriting” section of the Registration Statement, as to which such counsel expresses no opinions).

               (vii) Counsel has participated in conferences with officers and other representatives of the Company, representatives of the independent public accountants for the Company and representatives of the Underwriters at which the contents of the Registration Statement, the Prospectus and related matters were discussed and although such counsel is not passing upon and does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement and Prospectus (except as otherwise set forth in this opinion), no facts have come to the attention of such counsel which lead them to believe that either the Registration Statement or the Prospectus or any amendment or supplement thereto, as of the date of such opinion contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (it being understood that such counsel need express no opinion with respect to (i) any disclosures relating to the laws, rules, statutes or regulations of India or (ii) the financial statements and schedules and other financial and statistical data included in the Registration Statement or Prospectus).

               (viii) The Registration Statement is effective under the Act. To such counsel’s knowledge, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or threatened under the Act or applicable state securities laws.

               (ix) To such counsel’s knowledge, there is no action, suit or proceeding before or by any court of governmental agency or body, domestic or foreign, now pending, or threatened against the Company that is required to be described in the Registration Statement.

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          4.2.2 Closing Date and Option Closing Date Opinion of Counsel . On each of the Closing Date and the Option Closing Date, if any, the Representative shall have received the favorable opinion of Seyfarth, dated the Closing Date or the Option Closing Date, as the case may be set forth above, addressed to the Representative and in form and substance reasonably satisfactory to the Representative, confirming as of the Closing Date and, if applicable, the Option Closing Date, the statements made by Seyfarth in their respective opinions delivered on the Effective Date.

          4.2.3 Reliance . In rendering such opinion, such counsel may rely: (i) as to matters involving the application of laws other than the laws of the United States and jurisdictions in which they are admitted, to the extent such counsel deems proper and to the extent specified in such opinion, if at all, upon an opinion or opinions (in form and substance reasonably satisfactory to the Representative) of other counsel reasonably acceptable to the Representative, familiar with the applicable laws; and (ii) as to matters of fact, to the extent they deem proper, on certificates or other written statements of officers of the Company and officers of departments of various jurisdiction having custody of documents respecting the corporate existence or good standing of the Company, provided that copies of any such statements or certificates shall be delivered to the Underwriters’ counsel if requested. The opinion of counsel for the Company and any opinion relied upon by such counsel for the Company shall include a statement to the effect that it may be relied upon by counsel for the Underwriters in its opinion delivered to the Underwriters.

     4.3 Cold Comfort Letter . At the time this Agreement is executed, and at each of the Closing Date and the Option Closing Date, if any, you shall have received a letter, addressed to the Representative and in form and substance satisfactory in all respects (including the non-material nature of the changes or decreases, if any, referred to in clause (iii) below) to you and to Gersten Savage from GGK dated, respectively, as of the date of this Agreement and as of the Closing Date and the Option Closing Date, if any:

          (i) Confirming that they are independent accountants with respect to the Company within the meaning of the Act and the applicable Regulations and that they have not, during the periods covered by the financial statements included in the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act;

          (ii) Stating that in their opinion the financial statements of the Company included in the Registration Statement and Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act and the published Regulations thereunder;

          (iii) Stating that, on the basis of a limited review which included a reading of the latest available unaudited interim financial statements of the Company (with an indication of the date of the latest available unaudited interim financial statements), a reading of the latest available minutes of the stockholders and board of directors and the various committees of the board of directors, consultations with officers and other employees of the Company responsible for financial and accounting matters and other specified procedures and inquiries, nothing has come to their attention which would lead them to believe that: (a) the unaudited financial statements of the Company included in the Registration Statement do not comply as to form in all material respects with the applicable accounting requirements of the Act and the Regulations or are not fairly presented in conformity with generally accepted accounting principles applied on a basis substantially consistent with that of the audited financial statements of the Company included in the Registration Statement; (b) at a date not later than five days prior to the Effective Date, Closing Date or Option Closing Date, as the case may be, there was any change in the capital stock or long-term debt of the Company, or any decrease in the stockholders’ equity of the Company as compared with amounts shown in the September 30, 2005 balance sheet included in the Registration Statement, other than as set forth in or contemplated by the Registration Statement, or, if there was any decrease, setting forth the amount of such decrease, and (c) during the period from September 30, 2005 to a specified date not later than five days prior to the Effective Date, Closing Date or Option

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Closing Date, as the case may be, there was any decrease in revenues, net earnings or net earnings per share of Common Stock, in each case as compared with the corresponding period in the preceding year and as compared with the corresponding period in the preceding quarter, other than as set forth in or contemplated by the Registration Statement, or, if there was any such decrease, setting forth the amount of such decrease;

          (iv) Setting forth, at a date not later than five days prior to the Effective Date, the amount of liabilities of the Company (including a break-down of commercial papers and notes payable to banks);

          (v) Stating that they have compared specific dollar amounts, numbers of shares, percentages of revenues and earnings, statements and other financial information pertaining to the Company set forth in the Prospectus in each case to the extent that such amounts, numbers, percentages, statements and information may be derived from the general accounting records, including work sheets, of the Company and excluding any questions requiring an interpretation by legal counsel, with the results obtained from the application of specified readings, inquiries and other appropriate procedures (which procedures do not constitute an examination in accordance with generally accepted auditing standards) set forth in the letter and found them to be in agreement;

          (vi) Stating that they have not during the immediately preceding five year period brought to the attention of the Company’s management any reportable condition related to internal structure, design or operation as defined in the Statement on Auditing Standards No. 60 “Communication of Internal Control Structure Related Matters Noted in an Audit,” in the Company’s internal controls; and

          (vii) Statements as to such other matters incident to the transaction contemplated hereby as you may reasonably request.

     4.4 Officers’ Certificates .

          4.4.1 Officers’ Certificate . At each of the Closing Date and the Option Closing Date, if any, the Representative shall have received a certificate of the Company signed by the Chairman of the Board or the Chief Financial Officer and the Secretary or Assistant Secretary of the Company, dated the Closing Date or the Option Closing Date, as the case may be, respectively, to the effect that the Company has performed all covenants and complied with all conditions required by this Agreement to be performed or complied with by the Company prior to and as of the Closing Date, or the Option Closing Date, as the case may be, and that the conditions set forth in Section 4.5 hereof have been satisfied as of such date and that, as of Closing Date and the Option Closing Date, as the case may be, the representations and warranties of the Company set forth in Section 2 hereof are true and correct. In addition, the Representative will have received such other and further certificates of officers of the Company as the Representative may reasonably request.

          4.4.2 Secretary’s Certificate . At each of the Closing Date and the Option Closing Date, if any, the Representative shall have received a certificate of the Company signed by the Secretary or Assistant Secretary of the Company, dated the Closing Date or the Option Date, as the case may be, respectively, certifying: (i) that the By-Laws and Articles of Incorporation of the Company are true and complete, have not been modified and are in full force and effect; (ii) that the resolutions relating to the public offering contemplated by this Agreement are in full force and effect and have not been modified; (iii) all correspondence between the Company or its counsel and the Commission; and (iv) as to the incumbency of the officers of the Company. The documents referred to in such certificate shall be attached to such certificate.

     4.5 No Material Changes . Prior to and on each of the Closing Date and the Option Closing Date, if any: (i) there shall have been no material adverse change or development involving a prospective

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material adverse change in the condition or prospects or the business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement and Prospectus; (ii) no action suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Initial Stockholder before or by any court or federal or state commission, board or other administrative agency wherein an unfavorable decision, ruling or finding may materially adversely affect the business, operations, prospects or financial condition or income of the Company, except as set forth in the Registration Statement and Prospectus; (iii) no stop order shall have been issued under the Act and no proceedings therefor shall have been initiated or threatened by the Commission; and (iv) the Registration Statement and the Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Act and the Regulations and shall conform in all material respects to the requirements of the Act and the Regulations, and neither the Registration Statement nor the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

     4.6 Delivery of Agreements .

          4.6.1 Effective Date Deliveries . On the Effective Date, the Company shall have delivered to the Representative executed copies of the Escrow Agreement, the Trust Agreement, Advisory Agreement, the Warrant Agreement, the Services Agreement and all of the Insider Letters.

          4.6.2 Closing Date Deliveries . On the Closing Date, the Company shall have delivered to the Representative executed copies of the Representative’s Purchase Option.

     4.7 Opinion of Counsel for the Underwriters . All proceedings taken in connection with the authorization, issuance or sale of the Securities as herein contemplated shall be reasonably satisfactory in form and substance to you and to Gersten Savage and you shall have received from such counsel a favorable opinion, dated the Closing Date and the Option Closing Date, if any, with respect to such of these proceedings as you may reasonably require. On or prior to the Effective Date, the Closing Date and the Option Closing Date, as the case may be, counsel for the Underwriters shall have been furnished such documents, certificates and opinions as they may reasonably require for the purpose of enabling them to review or pass upon the matters referred to in this Section 4.7, or in order to evidence the accuracy, completeness or satisfaction of any of the representations, warranties or conditions herein contained.

     4.8 Secondary Market Trading Survey . On the Closing Date, the Representative shall have received the Secondary Market Trading Survey from Gersten Savage.

     4.9 Quotation on the American Stock Exchange . On the Closing Date, the Company’s Units shall have been approved for listing on the American Stock Exchange.

5. Indemnification .

     5.1 Indemnification of Underwriters .

          5.1.1 General . Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless each of the Underwriters, their respective directors, officers and employees and each person, if any, who controls any such Underwriter (“ controlling person ”) within the meaning of Section 15 of the Act or Section 20(a) of the Exchange Act, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between any of the Underwriters and the Company or between any of the Underwriters and any third party or otherwise) to which they or any of them may become subject under the Act, the Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in (i) any Preliminary Prospectus, the Registration

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Statement or the Prospectus (as from time to time each may be amended and supplemented); (ii) in any post-effective amendment or amendments or any new registration statement and prospectus in which is included securities of the Company issued or issuable upon exercise of the Representative’s Purchase Option; or (iii) any application or other document or written communication (in this Section 5 collectively called “ application ”) executed by the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Units under the securities laws thereof or filed with the Commission, any state securities commission or agency, the American Stock Exchange; or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, unless such statement or omission was made in reliance upon and in conformity with written information furnished to the Company with respect to an Underwriter by or on behalf of such Underwriter expressly for use in any Preliminary Prospectus, the Registration Statement or Prospectus, or any amendment or supplement thereof, or in any application, as the case may be. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Preliminary Prospectus, the indemnity agreement contained in this paragraph shall not inure to the benefit of any Underwriter to the extent that any loss, liability, claim, damage or expense of such Underwriter results from the fact that a copy of the Prospectus was not given or sent to the person asserting any such loss, liability, claim or damage at or prior to the written confirmation of sale of the Securities to such person as required by the Act and the Regulations, and if the untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance by the Company with its obligations under Section 3.4 hereof. The Company agrees promptly to notify the Representative of the commencement of any litigation or proceedings against the Company or any of its officers, directors or controlling persons in connection with the issue and sale of the Securities or in connection with the Registration Statement or Prospectus.

          5.1.2 Procedure . If any action is brought against an Underwriter or controlling person in respect of which indemnity may be sought against the Company pursuant to Section 5.1.1, such Underwriter shall promptly notify the Company in writing of the institution of such action and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the reasonable approval of such Underwriter) and payment of actual expenses. Such Underwriter or controlling person shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such Underwriter or such controlling person unless: (i) the employment of such counsel at the expense of the Company shall have been authorized in writing by the Company in connection with the defense of such action; (ii) the Company shall not have employed counsel to have charge of the defense of such action; or (iii) such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from or additional to those available to the Company (in which case the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the reasonable fees and expenses of not more than one additional firm of attorneys selected by the Underwriter and/or controlling person shall be borne by the Company. Notwithstanding anything to the contrary contained herein, if the Underwriter or controlling person shall assume the defense of such action as provided above, the Company shall have the right to approve the terms of any settlement of such action which approval shall not be unreasonably withheld.

     5.2 Indemnification of the Company . Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless the Company, its directors, officers and employees and agents who control the Company within the meaning of Section 15 of the Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company to the several Underwriters, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made in any Preliminary Prospectus, the Registration Statement or Prospectus or any amendment or supplement thereto or in any application, in reliance upon, and in strict conformity with, written information furnished to the Company with respect to such Underwriter by or on behalf of the Underwriter expressly for use in such Preliminary Prospectus, the Registration Statement or

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Prospectus or any amendment or supplement thereto or in any such application. In case any action shall be brought against the Company or any other person so indemnified based on any Preliminary Prospectus, the Registration Statement or Prospectus or any amendment or supplement thereto or any application, and in respect of which indemnity may be sought against any Underwriter, such Underwriter shall have the rights and duties given to the Company, and the Company and each other person so indemnified shall have the rights and duties given to the several Underwriters by the provisions of Section 5.1.2.

     5.3 Contribution .

          5.3.1 Contribution Rights . In order to provide for just and equitable contribution under the Act in any case in which (i) any person entitled to indemnification under this Section 5 makes claim for indemnification pursuant hereto but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Section 5 provides for indemnification in such case, or (ii) contribution under the Act, the Exchange Act or otherwise may be required on the part of any such person in circumstances for which indemnification is provided under this Section 5, then, and in each such case, the Company and the Underwriters shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Company and the Underwriters, as incurred, in such proportions that the Underwriters are responsible for that portion represented by the percentage that the underwriting discount appearing on the cover page of the Prospectus bears to the initial offering price appearing thereon (to the extent that it shall have actually been paid from the Trust Fund to the Underwriters as of each date a contribution obligation is payable hereunder; otherwise, the Underwriters’ contribution shall be limited to the underwriting discount paid on the Closing Date) ( the “Underwriters’ Contribution Percentage” ) and the Company is responsible for the balance; provided, that, no person guilty of a fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation, provided, further , that upon consummation of a Business Combination and delivery of the Escrowed Fees to the Underwriters, the Underwriters’ Contribution Percentage shall be increased by the percentage that the Escrowed Fees bears to the initial offering price (the “Final Contribution Percentage” ) and the Final Contribution Percentage shall hereafter be applicable only to new claims for contribution by the Company. Notwithstanding the provisions of this Section 5.3.1, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Public Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has otherwise been required to pay in respect of such losses, liabilities, claims, damages and expenses. For purposes of this Section, each director, officer and employee of an Underwriter or the Company, as applicable, and each person, if any, who controls an Underwriter or the Company, as applicable, within the meaning of Section 15 of the Act shall have the same rights to contribution as the Underwriters or the Company, as applicable.

          5.3.2 Contribution Procedure . Within fifteen days after receipt by any party to this Agreement (or its representative) of notice of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against another party (“contributing party”), notify the contributing party of the commencement thereof, but the omission to so notify the contributing party will not relieve it from any liability which it may have to any other party other than for contribution hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or its representative of the commencement thereof within the aforesaid fifteen days, the contributing party will be entitled to participate therein with the notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any party seeking contribution on account of any settlement of any claim, action or proceeding effected by such party seeking contribution on account of any settlement of any claim, action or proceeding effected by such party seeking contribution without the written consent of such contributing party. The contribution provisions contained in this Section are intended to supersede, to the extent permitted by law, any right to contribution under the Act, the Exchange Act or otherwise available. The Underwriters’ obligations to contribute pursuant to this Section 5.3 are several and not joint.

6. Default by an Underwriter .

     6.1 Default Not Exceeding 10% of Firm Units or Option Units . If any Underwriter or Underwriters shall default in its or their obligations to purchase the Firm Units or the Option Units, if the

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over-allotment option is exercised, hereunder, and if the number of the Firm Units or Option Units with respect to which such default relates does not exceed in the aggregate 10% of the number of Firm Units or Option Units that all Underwriters have agreed to purchase hereunder, then such Firm Units or Option Units to which the default relates shall be purchased by the non-defaulting Underwriters in proportion to their respective commitments hereunder.

     6.2 Default Exceeding 10% of Firm Units or Option Units . In the event that such default relates to more than 10% of the Firm Units or Option Units, you may in your discretion arrange for yourself or for another party or parties to purchase such Firm Units or Option Units to which such default relates on the terms contained herein. If within one business day after such default relating to more than 10% of the Firm Units or Option Units you do not arrange for the purchase of such Firm Units or Option Units, then the Company shall be entitled to a further period of one business day within which to procure another party or parties satisfactory to you to purchase said Firm Units or Option Units on such terms. In the event that neither you nor the Company arrange for the purchase of the Firm Units or Option Units to which a default relates as provided in this Section 6, this Agreement will automatically be terminated without liability on the part of the Company (except as provided in Sections 3.15 and 5 hereof) or the several Underwriters (except as provided in Section 5 hereof); provided , however , that if such default occurs with respect to the Option Units, this Agreement will not terminate as to the Firm Units; and provided further that nothing herein shall relieve a defaulting Underwriter of its liability, if any, to the other several Underwriters and to the Company for damages occasioned by its default hereunder.

     6.3 Postponement of Closing Date . In the event that the Firm Units or Option Units to which the default relates are to be purchased by the non-defaulting Underwriters, or are to be purchased by another party or parties as aforesaid, you or the Company shall have the right to postpone the Closing Date or Option Closing Date for a reasonable period, but not in any event exceeding five business days, in order to effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus or in any other documents and arrangements, and the Company agrees to file promptly any amendment to the Registration Statement or the Prospectus that in the opinion of counsel for the Underwriter may thereby be made necessary. The term “Underwriter” as used in this Agreement shall include any party substituted under this Section 6 with like effect as if it had originally been a party to this Agreement with respect to such Securities.

7. Right to Appoint Representative . For a period of two years from the Effective Date, upon notice from FBW to the Company, FBW shall have the right to send a representative (who need not be the same individual from meeting to meeting) to observe each meeting of the Board of Directors of the Company; provided that such representative shall sign a Regulation FD compliant confidentiality agreement which is reasonably acceptable to FBW and its counsel in connection with such representative’s attendance at meetings of the Board of Directors; and provided further that upon written notice to FBW, the Company may exclude the representative from meetings where, in the written opinion of counsel for the Company, the representative’s presence would destroy the attorney-client privilege. The Company agrees to give FBW written notice of each such meeting and to provide FBW with an agenda and minutes of the meeting no later than it gives such notice and provides such items to the other directors, and reimburse the representative of FBW for its reasonable out-of-pocket expenses incurred in connection with its attendance at the meeting, including but not limited to, food, lodging and transportation.

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8. Additional Covenants .

     8.1 Board Composition and Board Designations . For a period of five years from the Effective Date, the Company shall ensure that (i) the qualifications of the persons serving as board members and the overall composition of the board comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and with the listing requirements of the Nasdaq or any other national securities exchange or national securities association (as the case may be in the event the Company seeks to have its Public Securities listed on another exchange or quoted on an automated quotation system), and (ii) if applicable, at least one member of the board of directors qualifies as a “financial expert” as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder.

     8.2 Additional Shares or Options . The Company hereby agrees that until the Company consummates a Business Combination (as such term is defined in the Registration Statement), it shall not issue any shares of Common Stock or any options or other securities convertible into Common Stock, or any shares of Preferred Stock which participate in any manner in the Trust Fund or which vote as a class with the Common Stock on a Business Combination.

     8.3 Trust Fund Waiver Letters . The Company hereby agrees that it will not commence its due diligence investigation of any operating business which the Company seeks to acquire (“ Target Business ”) or obtain the services of any vendor unless and until the Target Business or the vendor executes a waiver letter in the form attached hereto as Exhibit A and B , respectively. Furthermore, each officer and director of the Company shall execute a waiver letter in the form attached hereto as Exhibit C.

     8.4 Insider Letters . The Company shall not take any action or omit to take any action which would cause a breach of any of the Insider Letters executed between each Initial Stockholder and FBW and will not allow any amendments to, or waivers of, such Insider Letters without the prior written consent of FBW.

     8.5 Articles of Incorporation and By-Laws . The Company shall not take any action or omit to take any action that would cause the Company to be in breach or violation of its Articles of Incorporation or By-Laws.

     8.6 Blue Sky Requirements . The Company shall provide counsel to the Representative with ten copies of all proxy information and all related material filed with the Commission in connection with a Business Combination concurrently with such filing with the Commission. In addition, the Company shall furnish any other state in which its initial public offering was registered, such information as may be requested by such state.

     8.7 Intentionally Omitted .

     8.8 Acquisition/Liquidation Procedure . The Company agrees: (i) that, prior to the consummation of any Business Combination, it will submit such transaction to the Company’s stockholders for their approval (“ Business Combination Vote ”) even if the nature of the acquisition is such as would not ordinarily require stockholder approval under applicable state law; and (ii) that, in the event that the Company does not effect a Business Combination within 18 months from the consummation of this Offering (subject to extension for an additional six-month period, as described in the Prospectus), the Company will be liquidated and will distribute to all holders of IPO Shares (defined below) an aggregate sum equal to the Company’s “Liquidation Value.” With respect to the Business Combination Vote, the Company shall cause all of the Initial Stockholders to vote the shares of Common Stock owned by them immediately prior to this Offering in accordance with the vote of the holders of a majority of the IPO Shares. At the time the Company seeks approval of any potential Business Combination, the Company will offer each of holders of the Company’s Common Stock issued in this

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Offering (the “ IPO Shares ”) the right to convert their IPO Shares at a per share price equal to the amount in the Trust Fund (inclusive of any interest income therein) on the record date (the “ Conversion Price ”) for determination of stockholders entitled to vote upon the proposal to approve such Business Combination (the “ Record Date ”) divided by the total number of IPO Shares. The Company’s “Liquidation Value” shall mean the Company’s book value, as determined by the Company and audited by GGK. In no event, however, will the Company’s Liquidation Value be less than the Trust Fund, inclusive of any net interest income thereon. If holders of less than 20% in interest of the Company’s IPO Shares vote against such approval of a Business Combination, the Company may, but will not be required to, proceed with such Business Combination. If the Company elects to so proceed, it will convert shares, based upon the Conversion Price, from those holders of IPO Shares who affirmatively requested such conversion and who voted against the Business Combination. Only holders of IPO Shares shall be entitled to receive liquidating distributions and the Company shall pay no liquidating distributions with respect to any other shares of capital stock of the Company. If holders of 20% or more in interest of the IPO Shares vote against approval of any potential Business Combination, the Company will not proceed with such Business Combination and will not convert such shares.

     8.8 Rule 419 . The Company agrees that it will use its best efforts to prevent the Company from becoming subject to Rule 419 under the Act prior to the consummation of any Business Combination, including, but not limited to, using its best efforts to prevent any of the Company’s outstanding securities from being deemed to be a “penny stock” as defined in Rule 3a-51-1 under the Exchange Act during such period.

     8.9 Affiliated Transactions . The Company shall cause each of the Initial Stockholders to agree that, in order to minimize potential conflicts of interest which may arise from multiple affiliations, the Initial Stockholders will present to the Company for its consideration, prior to presentation to any other person or company, any suitable opportunity to acquire an operating business, until the earlier of the consummation by the Company of a Business Combination, the liquidation of the Company or until such time as the Initial Stockholders cease to be an officer or director of the Company, subject to any pre-existing fiduciary obligations the Initial Stockholders might have or new fiduciary obligations related to or affiliated with entities to whom the Initial Stockholders have pre-existing fiduciary obligations, including, but not limited to, fiduciary obligations to next generation, follow-on or successor entities to any entities to which the Initial Stockholders have pre-existing obligations.

     8.10 Target Net Assets . The Company agrees that the initial Target Business that it acquires must have a fair market value equal to at least 80% of the Company’s net assets at the time of such acquisition. The fair market value of such business must be determined by the Board of Directors of the Company based upon standards generally accepted by the financial community, such as actual and potential sales, earnings and cash flow and book value. If the Board of Directors of the Company is not able to independently determine that the target business has a fair market value of at least 80% of the Company’s fair market value at the time of such acquisition, the Company will obtain an opinion from an unaffiliated, independent investment banking firm which is a member of the NASD with respect to the satisfaction of such criteria. The Company is not required to obtain an opinion from an investment banking firm as to the fair market value if the Company’s Board of Directors independently determines that the Target Business does have sufficient fair market value.

26


 

9. Representations and Agreements to Survive Delivery . Except as the context otherwise requires, all representations, warranties and agreements contained in this Agreement shall be deemed to be representations, warranties and agreements at the Closing Dates and such representations, warranties and agreements of the Underwriters and Company, including the indemnity agreements contained in Section 5 hereof, shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any Underwriter, the Company or any controlling person, and shall survive termination of this Agreement or the issuance and delivery of the Securities to the several Underwriters until the earlier of the expiration of any applicable statute of limitations and the seventh anniversary of the later of the Closing Date or the Option Closing Date, if any, at which time the representations, warranties and agreements shall terminate and be of no further force and effect.

10. Effective Date of This Agreement and Termination Thereof .

     10.1 Effective Date . This Agreement shall become effective on the Effective Date at the time the Registration Statement is declared effective by the Commission.

     10.2 Termination . You shall have the right to terminate this Agreement at any time prior to any Closing Date, (i) if any domestic or international event or act or occurrence has materially disrupted, or in your opinion will in the immediate future materially disrupt, general securities markets in the United States; or (ii) if trading on the New York Stock Exchange, the American Stock Exchange, the Boston Stock Exchange or on the NASD OTC Bulletin Board (or successor trading market) shall have been suspended, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been fixed, or maximum ranges for prices for securities shall have been required on the NASD OTC Bulletin Board or by order of the Commission or any other government authority having jurisdiction, or (iii)if the United States shall have become involved in a new war or an increase in major hostilities, or (iv) if a banking moratorium has been declared by a New York State or federal authority, or (v) if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United States securities market, or (vi) if the Company shall have sustained a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have been insured, will, in your opinion, make it inadvisable to proceed with the delivery of the Units, or (vii) if any of the Company’s representations, warranties or covenants hereunder are breached, or (viii) if the Representative shall have become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company, or such adverse material change in general market conditions as in the Representative’s judgment would make it impracticable to proceed with the offering, sale and/or delivery of the Units or to enforce contracts made by the Underwriters for the sale of the Units.

     10.3 Expenses . In the event that this Agreement shall not be carried out for any reason whatsoever, within the time specified herein or any extensions thereof pursuant to the terms herein, the obligations of the Company to pay the out of pocket expenses related to the transactions contemplated herein shall be governed by Section 3.13.1 hereof.

     10.4 Indemnification . Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Section 5 shall not be in any way effected by, such election or termination or failure to carry out the terms of this Agreement or any part hereof.

11. Miscellaneous .

     11.1 Notices . All communications hereunder, except as herein otherwise specifically provided, shall be in writing and shall be mailed, delivered or telecopied and confirmed and shall be deemed given when so delivered or telecopied and confirmed or if mailed, two days after such mailing

27


 

If to the Representative:

Ferris, Baker Watts, Inc.
100 Light Street
Baltimore, Maryland 21202
Attn: Scott Bass, Vice-President

Copy to:

Gersten Savage LLP
600 Lexington Avenue, 9 th Floor
New York, New York 10022
Attn: Arthur S. Marcus, Esq.

If to the Company:

India Globalization Capital, Inc.
c/o Integrated Global Networks, LLC
4336 Montgomery Avenue
Bethesda, Maryland 20814
Attn: Ram Mukunda, Chairman and Chief Executive Officer

Copy to:

Seyfarth Shaw LLP
55 East Monroe Street, Suite 4200
Chicago, Illinois 60603-5803
Attn: Michael E. Blount, Esq.

     11.2 Headings . The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the meaning or interpretation of any of the terms or provisions of this Agreement.

     11.3 Amendment . This Agreement may only be amended by a written instrument executed by each of the parties hereto.

     11.4 Entire Agreement . This Agreement (together with the other agreements and documents being delivered pursuant to or in connection with this Agreement) constitute the entire agreement of the parties hereto with respect to the subject matter hereof and thereof, and supersede all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof.

     11.5 Binding Effect . This Agreement shall inure solely to the benefit of and shall be binding upon the Representative, the Underwriters, the Company and the controlling persons, directors and officers referred to in Section 5 hereof, and their respective successors, legal representatives and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Agreement or any provisions herein contained.

     11.6 Governing Law . This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Maryland, without giving effect to conflict of laws. The Company hereby agrees that any action, proceeding or claim against it arising out of, relating in any way to this Agreement shall be brought and enforced in the courts of the State of Maryland of the United States of America for the District of Baltimore, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction

28


 

and that such courts represent an inconvenient forum. Any such process or summons to be served upon the Company may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in Section 10 hereof. Such mailing shall be deemed personal service and shall be legal and binding upon the Company in any action, proceeding or claim. The Company agrees that the prevailing party(ies) in any such action shall be entitled to recover from the other party(ies) all of its reasonable attorneys’ fees and expenses relating to such action or proceeding and/or incurred in connection with the preparation therefor.

     11.7 Execution in Counterparts . This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement, and shall become effective when one or more counterparts has been signed by each of the parties hereto and delivered to each of the other parties hereto.

     11.8 Waiver, Etc. The failure of any of the parties hereto to at any time enforce any of the provisions of this Agreement shall not be deemed or construed to be a waiver of any such provision, nor to in any way effect the validity of this Agreement or any provision hereof or the right of any of the parties hereto to thereafter enforce each and every provision of this Agreement. No waiver of any breach, non-compliance or non-fulfillment of any of the provisions of this Agreement shall be effective unless set forth in a written instrument executed by the party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent breach, non-compliance or non-fulfillment.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

29


 

     If the foregoing correctly sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between us.
         
  Very truly yours,

INDIA GLOBALIZATION CAPITAL, INC.
 
 
  By:      
    Name:   Ram Mukunda   
    Title:   Chairman and Chief Executive Officer   
 

Accepted on the date first
above written.
         
FERRIS, BAKER WATTS, INC.
 
   
By:        
  Name:   Scott Bass    
  Title:   Vice-President     

30


 

SCHEDULE I

INDIA GLOBALIZATION CAPITAL, INC.

10,000,000 Units

         
    Number of Firm Units  
Underwriter   to be Purchased  
Ferris, Baker Watts, Inc.
       
First Albany Capital Inc. 
       
 
       
Ladenburg Thalmann & Co. Inc. 
       
Merriman Curhan Ford & Co.
       
SG Americas Securities, LLC
       
 
       
    9,830,000   

 


 

SCHEDULE 2.29

INDIA GLOBALIZATION CAPITAL, INC.

Board of Directors

Ram Mukunda

John Cherin

Dr. Ranga Krishna

Suhail Nathani

Sudhakar Shenoy

 


 

EXHIBIT A

India Globalization Capital, Inc.
Attn.: Ram Mukunda
c/o Integrated Global Networks, LLC
4336 Montgomery Avenue
Bethesda, Maryland 20814

Gentlemen:

          Reference is made to the Final Prospectus of India Globalization Capital, Inc. (“ IGC ”), dated                      , 2005 (the “ Prospectus ”). Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in Prospectus.

          We have read the Prospectus and understand that IGC has established the Trust Fund, initially in an amount of $                      for the benefit of the Public Stockholders and that IGC may disburse monies from the Trust Fund only (i) to the Public Stockholders in the event of the redemption of their shares or the liquidation of IGC or (ii) to IGC after it consummates a Business Combination.

          For and in consideration of IGC agreeing to evaluate the undersigned for purposes of consummating a Business Combination with it, the undersigned hereby agrees that it does not have any right, title, interest or claim of any kind in or to any monies in the Trust Fund (the “ Claim ”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with IGC and will not seek recourse against the Trust Fund for any reason whatsoever.

     
 
   
 
  Print Name of Target Business
 
   
 
   
 
  Authorized Signature of Target Business

 


 

EXHIBIT B

India Globalization Capital, Inc.
Attn.: Ram Mukunda
c/o Integrated Global Networks, LLC
4336 Montgomery Avenue
Bethesda, Maryland 20814

Gentlemen:

          Reference is made to the Final Prospectus of India Globalization Capital, Inc. (“ IGC ”), dated                      , 2005 (the “ Prospectus ”). Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in Prospectus.

          We have read the Prospectus and understand that IGC has established the Trust Fund, initially in an amount of $                      for the benefit of the Public Stockholders and that IGC may disburse monies from the Trust Fund only: (i) to the Public Stockholders in the event of the redemption of their shares or the liquidation of IGC; or (ii) to IGC after it consummates a Business Combination.

          For and in consideration of IGC engaging the services of the undersigned, the undersigned hereby agrees that it does not have any right, title, interest or claim of any kind in or to any monies in the Trust Fund (the “ Claim ”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any contracts or agreements with IGC and will not seek recourse against the Trust Fund for any reason whatsoever.

     
 
   
 
  Print Name of Lender
 
   
 
   
 
  Authorized Signature of Lender

 


 

EXHIBIT C

India Globalization Capital, Inc.
Attn.: Ram Mukunda
c/o Integrated Global Networks, LLC
4336 Montgomery Avenue
Bethesda, Maryland 20814

Gentlemen:

          The undersigned officer or director of India Globalization Capital, Inc. (“ IGC ”) hereby acknowledges that IGC has established the Trust Fund, initially in an amount of $___for the benefit of the Public Stockholders and that IGC may disburse monies from the Trust Fund only (i) to the Public Stockholders in the event of the redemption of their shares or the liquidation of IGC or (ii) to IGC after it consummates a Business Combination.

          The undersigned hereby agrees that it does not have any right, title, interest or claim of any kind in or to any monies in the Trust Fund (the “ Claim ”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any contracts or agreements with IGC and will not seek recourse against the Trust Fund for any reason whatsoever.

          Notwithstanding the foregoing, such waiver shall not apply to any shares acquired by the undersigned in the public market after the initial public offering by the Company of its securities.

     
 
   
 
  Print Name of Officer/Director
 
   
 
   
 
  Authorized Signature of Officer/Director

 

 

EXHIBIT 3.2

BYLAWS

OF

INDIA GLOBALIZATION CAPITAL, INC.

 


 

EXHIBIT 3.2

TABLE OF CONTENTS

         
ARTICLE I. OFFICES AND RECORDS
    1  
Section 1.01. Registered Office
    1  
Section 1.02. Other Offices
    1  
Section 1.03. Books and Records
    1  
 
       
ARTICLE II. STOCKHOLDERS
    1  
Section 2.01. Annual Meeting
    1  
Section 2.02. Special Meeting
    1  
Section 2.03. Place of Meeting
    2  
Section 2.04. Notice of Meeting
    2  
Section 2.05. Quorum and Adjournment; Voting
    2  
Section 2.06. Proxies
    2  
Section 2.07. Notice of Stockholder Business and Nominations
    3  
Section 2.08. Procedure for Election of Directors; Required Vote; Voting
    6  
Section 2.09. Inspectors of Elections; Opening and Closing the Polls
    6  
Section 2.10. Action Without meeting
    7  
 
       
ARTICLE III. BOARD OF DIRECTORS
    7  
Section 3.01. General Powers
    7  
Section 3.02. Meetings Generally
    8  
Section 3.03. Regular Meetings
    8  
Section 3.04. Special Meetings
    8  
Section 3.05. Notice
    8  
Section 3.06. First Meeting
    8  
Section 3.07. Action by Consent of Board of Directors
    8  
Section 3.08. Conference Telephone Meetings
    8  
Section 3.09. Quorum
    9  
Section 3.10. Committees of the Board of Directors
    9  
Section 3.11. Records
    9  
Section 3.12. Compensation of Directors
    9  
 
       
ARTICLE IV. OFFICERS
    10  
Section 4.01. Elected Officers
    10  
Section 4.02. Election and Term of Office
    10  
Section 4.03. Chairman of the Board and Chief Executive Officer
    10  
Section 4.04. President
    10  
Section 4.05. Vice Presidents
    11  
Section 4.06. Treasurer
    11  
Section 4.07. Secretary
    11  
Section 4.08. Removal
    12  
Section 4.09. Vacancies
    12  
Section 4.10. Execution of Documents
    12  

i


 

         
 
       
ARTICLE V. STOCK CERTIFICATES AND TRANSFERS
    12  
Section 5.01. Stock Certificates and Transfers
    12  
Section 5.02. Lost, Stolen or Destroyed Certificates
    13  
Section 5.03. Transfers of Stock
    13  
Section 5.04. Registered Stockholders
    13  
 
       
ARTICLE VI. MISCELLANEOUS PROVISIONS
    13  
Section 6.01. Fiscal Year
    13  
Section 6.02. Dividends
    13  
Section 6.03. Seal
    14  
Section 6.04. Waiver of Notice
    14  
Section 6.05. Audits
    14  
Section 6.06. Resignations
    14  
Section 6.07. Fixing Record Date
    14  
Section 6.08. Loans
    15  
Section 6.09. Deposits
    15  
Section 6.10. Annual Statement
    15  
Section 6.11. Form of Records
    15  
Section 6.12. Control Share Acquisition Act
    15  
 
       
ARTICLE VII. CONTRACTS, PROXIES, ETC
    15  
Section 7.01. Contracts
    15  
Section 7.02. Proxies
    16  
 
       
ARTICLE VIII. AMENDMENTS
    16  
Section 8.01. Amendments
    16  
 
       
ARTICLE IX. INDEMNIFICATION AND INSURANCE
    16  
Section 9.01. Right to Indemnification
    16  
Section 9.02. Right of Claimant to Bring Suit
    17  
Section 9.03. Non-Exclusivity of Rights
    17  
Section 9.04. Insurance
    18  
Section 9.05. Severability
    18  

ii


 

EXHIBIT 3.2

BYLAWS
OF
INDIA GLOBALIZATION CAPITAL, INC.

ARTICLE I.
OFFICES AND RECORDS

     Section 1.01. Registered Office. The principal office of India Globalization Capital, Inc. (the “Corporation”) shall be located at such place as the Board of Directors of the Corporation may designate.

     Section 1.02. Other Offices. The Corporation may have such other offices, either within or without the State of Maryland, as the board of directors of the Corporation (the “Board of Directors”, and each member thereof, a “Director”) may designate or as the business of the Corporation may from time to time require.

ARTICLE II.
STOCKHOLDERS

     Section 2.01. Annual Meeting. The annual meeting of the stockholders of the Corporation for the election of Directors and for the transaction of such other business as may properly come before the meeting shall be held on such date and at such time as may be fixed by resolution of the Board of Directors.

     Section 2.02. Special Meeting. Except as otherwise required by law special meetings of stockholders of the Corporation for any purpose or purposes may be called only (a) by the Chief Executive Officer of the Corporation, (b) by the Board of Directors pursuant to a resolution stating the purpose or purposes thereof approved by a majority of the total number of Directors which the Corporation would have if there were no vacancies or unfilled newly-created directorships (the “Whole Board”), or (c) except as otherwise provided by law, by the Secretary of the Corporation on the written request of stockholders entitled to cast at least a majority of all the votes entitled to be cast at such a special meeting. Such written request by the stockholders shall state the purpose or purposes of such special meeting and the matters proposed to be acted on thereat. The Secretary shall inform such requesting stockholders of the reasonably estimated cost of preparing and mailing such notice of the meeting, and, upon payment to the Corporation of such costs, the Secretary shall give notice stating the purpose or purposes of such special meeting to all stockholders entitled to notice of such meeting. No special meeting need be called upon the request of the stockholders entitled to cast less than a majority of all the votes entitled to be cast at such special meeting or to consider any matter which is substantially the same as a matter voted upon at any special meeting of the stockholders held during the preceding twelve (12) months. No business other than that stated in the Corporation’s notice of meeting under Section 2.04 shall be brought before or transacted at any special meeting.

     Section 2.03. Place of Meeting. The Board of Directors or the Chairman of the Board, as the case may be, may designate the place, if any, of meeting for any annual meeting or for any

 


 

special meeting of the stockholders. In lieu of holding a stockholders meeting in a fixed place, the Board of Directors may make arrangements for stockholders to participate in a the meeting by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at such meeting.

     Section 2.04. Notice of Meeting. Notice, stating the place (if any), day and hour of the meeting and the purpose or purposes for which the meeting is called, shall be delivered by the Corporation not less than ten (10) calendar days nor more than ninety (90) calendar days before the date of the meeting, either personally, by mail, by electronic transmission or by other lawful means, to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail with postage thereon prepaid, addressed to the stockholder at such person’s address as it appears on the stock transfer books of the Corporation. If sent by electronic transmission, such notice shall be deemed given when transmitted to the stockholder by electronic mail to any electronic mail address of the stockholder or by any electronic means. Such further notice shall be given as may be required by law. Meetings may be held without notice if all stockholders entitled to notice are present (except when stockholders entitled to notice attend the meeting for the express purpose of objecting, at the beginning of the meeting, because the meeting is not lawfully called or convened), or if notice is waived by those not present in accordance with Section 6.04. Any previously scheduled meeting of the stockholders may be postponed, and any special meeting of the stockholders may be canceled, by resolution of the Board of Directors upon public notice given prior to the date previously scheduled for such meeting of stockholders.

     Section 2.05. Quorum and Adjournment; Voting. Except as otherwise provided by law or by the Articles, the holders of a majority of the voting power of all outstanding shares of the Corporation entitled to vote generally in the election of Directors (the “Voting Stock”), represented in person or by proxy, shall constitute a quorum at a meeting of stockholders, except that when specified business is to be voted on by a class or series of stock voting as a class, the holders of a majority of the voting power of the outstanding shares of such class or series shall constitute a quorum of such class or series for the transaction of such business. The chairman of the meeting may adjourn the meeting from time to time, at his sole discretion, whether or not there is such a quorum. No notice of the time and place of adjourned meetings need be given except as required by law. The stockholders present at a duly called meeting at which a quorum is present may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.

     Section 2.06. Proxies. At all meetings of stockholders, a stockholder may vote by proxy in accordance with the General Corporation Law of the State of Maryland (the “MGCL”) or by such person’s duly authorized attorney in fact. No proxy shall be voted or acted upon after eleven (11) months from its date, unless the proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A stockholder may revoke any proxy which is not irrevocable by attending the meeting of stockholders and voting in person or by filing an instrument in writing revoking the proxy or another duly executed proxy bearing a later date with the Secretary of the Corporation.

2


 

     Section 2.07. Notice of Stockholder Business and Nominations.

          (a) Annual Meetings of Stockholders.

                    (i) Nominations of persons for election to the Board of Directors and the proposal of business to be considered by the stockholders may be made at an annual meeting of stockholders (A) pursuant to the Corporation’s notice of meeting pursuant to Section 2.04, (B) by or at the direction of the Board of Directors or (C) by any stockholder of the Corporation who was a stockholder of record at the time of giving of notice provided for in this Section 2.07, who shall be entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 2.07.

                    (ii) For nominations or other business to be properly brought before an annual meeting by a stockholder pursuant to clause (C) of paragraph (a)(i) of this Section 2.07, the stockholder must (W) have given timely notice thereof in writing to the Secretary of the Corporation; (X) the business must be a proper matter for stockholder action under Maryland law; (Y) if the stockholder, or the beneficial owner on whose behalf any such proposal or nomination is made, has provided the Corporation with a “Solicitation Notice” (as that term is defined below), such stockholder or beneficial owner must, in the case of a proposal, have delivered a proxy statement and form of proxy to holders of at least the percentage of the Corporation’s voting shares required under applicable law to carry any such proposal, or, in the case of a nomination or nominations, have delivered a proxy statement and form of proxy to holders of a percentage of the Corporation’s voting shares reasonably believed by such stockholder or beneficial holder to be sufficient to elect the nominee or nominees proposed to be nominated by such stockholder, and must, in either case, have included in such materials the Solicitation Notice; and (Z) if no Solicitation Notice relating thereto has been timely provided pursuant to this Section 2.07, the stockholder or beneficial owner proposing such business or nomination must not have solicited a number of proxies sufficient to have required the delivery of such a Solicitation Notice under this Section.. To be timely, a stockholder’s notice shall be delivered to the Secretary of the Corporation at the principal executive offices of the Corporation not later than the close of business on the ninetieth (90th) calendar day nor earlier than the close of business on the one hundred and twentieth (120th) calendar day prior to the first (1st) anniversary of the preceding year’s annual meeting; PROVIDED, HOWEVER, that in the event that the date of the annual meeting is more than thirty (30) calendar days before or more than sixty (60) calendar days after such anniversary date or in the case of the first annual meeting, notice by the stockholder to be timely must be so delivered not earlier than the close of business on the one hundred and twentieth (120th) calendar day prior to such annual meeting and not later than the close of business on the later of the ninetieth (90th) calendar day prior to such annual meeting or the tenth (10th) calendar day following the calendar day on which public announcement of the date of such meeting is first made by the Corporation. In no event shall the public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above. Such stockholder’s notice shall set forth (A) as to each person whom the stockholder proposes to nominate for election or reelection as a Director all information relating to such person that is required to be disclosed in solicitations of proxies for election of Directors in an

3


 

election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (including such person’s written consent to being named in the proxy statement as a nominee and to serving as a Director if elected); (B) as to any other business that the stockholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend these Bylaws, the language of the proposed amendment), the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made; and (C) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (1) the name and address of such stockholder, as they appear on the Corporation’s books, and of such beneficial owner, (2) the class (and, if applicable, series) and number of shares of stock of the Corporation which are owned beneficially and of record by such stockholder and such beneficial owner, (3) a representation that the stockholder is a holder of record of stock of the Corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such business or nomination, and (4) a representation whether the stockholder or the beneficial owner, if any, intends or is part of a group which intends to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the Corporation’s outstanding capital stock required to approve or adopt the proposal or elect such nominee or nominees (an affirmative statement of such intent, a “Solicitation Notice”). The foregoing notice requirements shall be deemed satisfied by a stockholder if the stockholder has notified the Corporation of his or her intention to present a proposal at an annual meeting in compliance with Rule 14a-8 (or any successor thereof) promulgated under the Exchange Act and such stockholder’s proposal has been included in a proxy statement that has been prepared by the Corporation to solicit proxies for such annual meeting. The Corporation may require any proposed nominee to furnish such other information as it may reasonably require to determine the eligibility of such proposed nominee to serve as a Director.

                    (iii) Notwithstanding anything in the second sentence of paragraph (a)(ii) of this Section 2.07 to the contrary, in the event that the number of Directors to be elected to the Board of Directors at an annual meeting is increased and there is no public announcement by the Corporation naming all of the nominees for Director or specifying the size of the increased Board of Directors at least one hundred (100) calendar days prior to the first (1st) anniversary of the preceding year’s annual meeting, a stockholder’s notice required by this Section 2.07 shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the tenth (10th) calendar day following the day on which such public announcement is first made by the Corporation.

          (b) Special Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the Corporation’s notice of meeting under Section 2.04. Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which Directors are to be elected (i) pursuant to the Corporation’s notice of meeting, (ii) by or at the direction of the Board of Directors or (iii) provided that the Board of Directors has determined that Directors shall be

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elected at such meeting, by any stockholder of the Corporation who is a stockholder of record at the time of giving of notice provided for in these Bylaws, who shall be entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 2.07. In the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more Directors to the Board of Directors, any stockholder entitled to vote in such election of Directors may nominate, pursuant to clause (iii) of the immediately preceding sentence of this Section 2.07(b), a person or persons (as the case may be) for election to such position(s) as specified in the Corporation’s notice of meeting, if the stockholder’s notice required by paragraph (a)(ii) of this Section 2.07 shall be delivered to the Secretary of the Corporation at the principal executive offices of the Corporation not earlier than the close of business on the one hundred and twentieth (120th) calendar day prior to such special meeting and not later than the close of business on the later of the ninetieth (90th) calendar day prior to such special meeting or the tenth (10th) calendar day following the calendar day on which public announcement of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such special meeting is first made by the Corporation. In no event shall the public announcement of an adjournment or postponement of a special meeting commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.

          (c) General.

                    (i) Only such persons who are nominated in accordance with the procedures set forth in this Section 2.07 shall be eligible to serve as Directors and only such business shall be conducted at a meeting of stockholders as (A) shall have been brought before the meeting in accordance with the procedures set forth in this Section 2.07 and (B) shall have been determined to be a proper matter for stockholder action under Maryland law. Except as otherwise provided by law, the Articles or these Bylaws, the chairman of the meeting shall have the power and the duty to determine whether a nomination or any business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 2.07 (including whether the stockholder or beneficial owner, if any, on whose behalf the nomination or proposal is made solicited (or is part of a group which solicited) or did not so solicit, as the case may be, proxies in support of such stockholder’s nominee or proposal in compliance with such stockholder’s representation as required by clause (a)(ii)(C)(4) of this Section 2.07 and whether any proposal of business to be considered by the stockholders is a proper matter for stockholder action under Maryland law) and, if any proposed nomination or business is not in compliance with this Section 2.07, to declare that such defective proposal or nomination shall be disregarded. Notwithstanding the foregoing provisions of this Section 2.07, if the stockholder (or a qualified representative of the stockholder) does not appear at the annual or special meeting of stockholders of the Corporation to present a nomination or business, such nomination shall be disregarded and such proposed business shall not be transacted, notwithstanding that proxies in respect of such vote may have been received by the Corporation.

                    (ii) For purposes of this Section 2.07, “public announcement” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.

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                    (iii) Notwithstanding the foregoing provisions of this Section 2.07, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations promulgated thereunder with respect to the matters set forth in this Section 2.07. Nothing in this Section 2.07 shall be deemed to affect any rights (a) of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act or (b) of the holders of any series of preferred stock of the Corporation (“Preferred Stock”) to elect Directors under an applicable Preferred Stock Designation (as defined in the Articles).

     Section 2.08. Voting. The affirmative vote of a majority of the voting power of the shares present in person or represented by proxy at the meeting and entitled to vote on any matter properly before the meeting shall be the act of the stockholders, except as otherwise provided in the Articles of Incorporation (the “Articles”). Except as otherwise provided by the Articles, each stockholder shall at every meeting of the stockholders be entitled to one vote in person or by proxy for each share of the Corporation’s capital stock having voting power held by such stockholder. Voting on any question or in any election may be by voice vote unless the chairman of the meeting shall demand that voting be by ballot.

     Section 2.09. Action Without Meeting. Unless otherwise provided in the Articles, any action required or permitted to be taken at any annual or special meeting of stockholders may be taken without a meeting, if a consent in writing, setting forth such action, is signed by all the stockholders entitled to vote on the subject matter thereof and any other stockholders entitled to notice of a meeting of stockholders but not to vote thereat have waived in writing any rights which they may have to dissent from such action, and such consent and waiver are filed with the records of stockholders’ meetings. Such consents and waivers shall be delivered to the Corporation by delivery to its registered office in the State of Maryland, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested or by electronic transmission. Every written consent shall bear the date of signature of each stockholder who signs the consent and no written consent shall be effective to take the corporate action referred to therein unless within sixty (60) days of the earliest dated consent delivered to the Corporation in the manner required by this Section 2.09, all required written consents and waivers are delivered to the Corporation as provided herein.

ARTICLE III.
BOARD OF DIRECTORS

     Section 3.01. General Powers. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to the powers and authorities by these Bylaws expressly conferred upon them, the Board of Directors may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Articles or by these Bylaws required to be exercised or done by the stockholders. The exact number of directors shall be fixed from time to time, within the limits specified herein or in

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the Articles, by the Board of Directors. The Board of Directors may be divided into Classes as more fully described in the Charter.

     Section 3.02. Meetings Generally. Meetings of the Board of Directors, regular or special, may be held at any place in or out of the State of Maryland as the Board of Directors may from time to time determine.

     Section 3.03. Regular Meetings. A regular meeting of the Board of Directors shall be held without other notice than this Bylaw in conjunction with the annual meeting of stockholders. The Board of Directors may, by resolution, provide the time and place for the holding of additional regular meetings without other notice than such resolution.

     Section 3.04. Special Meetings. Special meetings of the Board of Directors shall be called at the request of the Chairman of the Board, the Chief Executive Officer or a majority of the Board of Directors then in office. The person or persons authorized to call special meetings of the Board of Directors may fix the place and time of the meetings.

     Section 3.05. Notice. Notice of any special meeting of Directors shall be given to each Director at such person’s business or residence in writing by hand delivery, first-class or overnight mail or courier service, facsimile transmission, electronic mail transmission, orally by telephone or any other lawful means. If mailed by first-class mail, such notice shall be deemed adequately delivered when deposited in the United States mail so addressed, with postage thereon prepaid, at least five (5) calendar days before such meeting. If by overnight mail or courier service, such notice shall be deemed adequately delivered when the telegram is delivered to the telegraph company or the notice is delivered to the overnight mail or courier service company at least twenty-four (24) hours before such meeting. If by facsimile transmission, such notice shall be deemed adequately delivered when the notice is transmitted at least twelve (12) hours before such meeting. If by electronic mail transmission notice shall be deemed to be given the earlier of actual receipt or within twelve (12) hours of delivery provided that the message is not returned as undeliverable within such twelve (12) hour period. If by telephone, by hand delivery or by other lawful means, the notice shall be given at least twelve (12) hours prior to the time set for the meeting. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the notice of such meeting.

     Section 3.06. Action by Consent of Board of Directors. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if all members of the Board of Directors or committee, as the case may be, consent in writing thereto in accordance with applicable law and such written consent is filed with the minutes of proceedings of the Board of Directors or committee.

     Section 3.07. Conference Telephone Meetings. Members of the Board of Directors or any committee thereof may participate in a meeting of the Board of Directors or such committee by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at such meeting.

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     Section 3.08. Quorum. Subject to Article VIII of the Articles, a whole number of Directors equal to at least a majority of the Whole Board shall constitute a quorum for the transaction of business, but if at any meeting of the Board of Directors there shall be less than a quorum present, a majority of the Directors present may adjourn the meeting from time to time without further notice. The act of the majority of the Directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, unless the concurrence of a greater proportion is required for such action by statute, the Articles or these Bylaws.

     Section 3.09. Interested Directors. No contract or transaction between the Corporation and one or more of its directors or officers, or between the Corporation and any other corporation, partnership, association, or other organization in which one or more of its directors or officers are directors or officers, or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the Board of Directors or committee thereof which authorizes the contract or transaction, or solely because his or their votes are counted for such purpose, if (i) the materials facts as to his or their relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the Board of Directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even through the disinterested directors be less than a quorum; or (ii) the material facts as to his or their relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (iii) the contract or transaction is fair as to the Corporation as of the time it is authorized, approved or ratified, by the Board of Directors a committee thereof or the stockholders. Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction.

     Section 3.10. Committees of the Board of Directors.

          (a) The Board of Directors may from time to time designate committees, which shall consist of one or more Directors. The Board of Directors may designate one or more Directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. Any such committee may, to the extent permitted by law, exercise such powers and shall have such responsibilities as shall be specified in the designating resolution. In the absence or disqualification of any member of such committee or committees, the member or members thereof present at any meeting and not disqualified from voting, whether or not constituting a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Each committee shall keep written minutes of its proceedings and shall report such proceedings to the Board of Directors when required.

          (b) A majority of any committee may determine its action and fix the time and place of its meetings, unless the Board of Directors shall otherwise provide. Notice of such meetings shall be given to each member of the committee in the manner provided for in Section 3.05. The Board of Directors shall have power at any time to fill vacancies in, to change the membership of, or to dissolve any such committee. Nothing herein shall be deemed to prevent

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the Board of Directors from appointing one or more committees consisting in whole or in part of persons who are not Directors; PROVIDED, HOWEVER, that no such committee shall have or may exercise any authority of the Board of Directors.

     Section 3.11. Records. The Board of Directors shall cause to be kept a record containing the minutes of the proceedings of the meetings of the Board of Directors or of any committee thereof and of the stockholders, appropriate stock books and registers and such books of records and accounts as may be necessary for the proper conduct of the business of the Corporation.

     Section 3.12. Compensation of Directors. The Directors may, pursuant to action by the Board of Directors, be paid their expenses, if any, of attendance at each meeting of the Board of Directors and be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as Director. No such payment shall preclude any Director from serving the Corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may, pursuant to action by the Board of Directors, be allowed like compensation for attending committee meetings.

ARTICLE IV.
OFFICERS

     Section 4.01. Elected Officers. The elected officers of the Corporation shall be a Chairman of the Board and Chief Executive Officer, a President, a Secretary, a Treasurer, and such other officers (including, without limitation, chief financial officer, chief operating officer, one or more vice presidents and general counsel) as the Board of Directors from time to time may deem proper. The Chairman of the Board and Chief Executive Officer shall be chosen from among the Directors. All officers elected by the Board of Directors shall each have such powers and duties as generally pertain to their respective offices, subject to the specific provisions of this Article IV. Such officers shall also have such powers and duties as from time to time may be conferred by the Board of Directors or by any committee thereof. The Board of Directors or any committee thereof may from time to time elect, or the Chairman of the Board and Chief Executive Officer may appoint, such other officers (including one or more Vice Presidents, Controllers, Assistant Secretaries and Assistant Treasurers), as may be necessary or desirable for the conduct of the business of the Corporation. Such other officers and agents shall have such duties and shall hold their offices for such terms as shall be provided in these Bylaws or as may be prescribed by the Board of Directors or such committee or by the Chairman of the Board and Chief Executive Officer, as the case may be.

     Section 4.02. Election and Term of Office. The elected officers of the Corporation shall be elected annually by the Board of Directors at the regular meeting of the Board of Directors held in conjunction with the annual meeting of the stockholders. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as convenient. Each officer shall hold office until such person’s successor shall have been duly elected and shall have qualified or until such person’s death or until he shall resign or be removed pursuant to Section 4.10.

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     Section 4.03. Chairman of the Board and Chief Executive Officer. The Chairman of the Board and Chief Executive Officer shall preside at all meetings of the stockholders and of the Board of Directors and shall be the chief executive officer of the Corporation. The Chairman of the Board and Chief Executive Officer shall be responsible for the general management of the affairs of the Corporation and shall perform all duties incidental to such person’s office which may be required by law and all such other duties as are properly required of him by the Board of Directors or the stockholders. The Chairman of the Board and Chief Executive Officer shall make reports to the Board of Directors and the stockholders and shall see that all orders and resolutions of the Board of Directors and of any committee thereof are carried into effect. The Chairman of the Board and Chief Executive Officer shall be the President of the Corporation if no other person has been elected as the President. The Board of Directors also may elect a Vice-Chairman to act in the place of the Chairman of the Board and Chief Executive Officer upon his or her absence or inability to act.

     Section 4.04. Chief Operating Officer: The Board of Directors may designate a chief operating officer. The chief operating officer shall have the responsibilities and duties as set forth by the Board of Directors or the chief executive officer.

     Section 4.05. Chief Financial Officer: The Board of Directors may designate a chief financial officer. The chief financial officer shall have the responsibilities and duties as set forth by the Board of Directors or the chief executive officer.

     Section 4.06. President. The President shall act in a general executive capacity and shall assist the Chairman of the Board and Chief Executive Officer in the administration and operation of the Corporation’s business and general supervision of its policies and affairs. The President shall also perform such other duties as may from time to time be prescribed by the Chairman of the Board and Chief Executive Officer. The President, if he or she is also a Director, shall, in the absence of or because of the inability to act of the Chairman of the Board and Chief Executive Officer and, if applicable, the absence of the Vice-Chairman, perform all duties of the Chairman of the Board and Chief Executive Officer and preside at all meetings of stockholders and of the Board of Directors.

     Section 4.07. Vice Presidents. Each Senior Vice President and Executive Vice President and any Vice President shall have such powers and shall perform such duties as shall be assigned to such person by the Board of Directors or by the Chairman of the Board and Chief Executive Officer.

     Section 4.08. Treasurer. The Treasurer shall exercise general supervision over the receipt, custody and disbursement of corporate funds and shall keep, or cause to be kept, full and accurate accounts of receipts and disbursements in books belonging to the Corporation. The Treasurer shall cause the funds of the Corporation to be deposited in such banks as may be authorized by the Board of Directors, or in such banks as may be designated as depositories in the manner provided by resolution of the Board of Directors. The Treasurer shall disburse the funds of the Corporation as may be ordered by the Board of Directors or the Chairman of the Board and Chief Executive Officer, taking proper vouchers for such disbursements, and shall render to the Chairman of the Board and Chief Executive Officer and the Board of Directors, at

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regular meetings of the Board of Directors or when the Chairman of the Board and Chief Executive Officer or the Board of Directors so requires, an account of all his transactions as Treasurer and of the financial condition of the Corporation. The Treasurer shall have such further powers and duties and shall be subject to such directions as may be granted or imposed from time to time by the Board of Directors or the Chairman of the Board and Chief Executive Officer. The Board of Directors or the Chairman of the Board and Chief Executive Officer may designate one or more Assistant Treasurers who shall have such of the authority and perform such of the duties of the Treasurer as may be assigned to them by the Board of Directors or the Chairman of the Board and Chief Executive Officer. During the Treasurer’s absence or inability, the Treasurer’s authority and duties shall be possessed by such Assistant Treasurer(s) as the Board of Directors or the Chairman of the Board and Chief Executive Officer may designate.

     Section 4.09. Secretary. The Secretary shall attend all meetings of the stockholders and all meetings of the Board of Directors and any committees thereof and shall keep or cause to be kept in one or more books provided for that purpose, the minutes of all meetings of the Board of Directors, the committees of the Board of Directors and the stockholders; shall see that all notices are duly given in accordance with the provisions of these Bylaws and as required by law; shall be custodian of the records and the seal of the Corporation and affix and attest the seal to all stock certificates of the Corporation (unless the seal of the Corporation on such certificates shall be a facsimile, as hereinafter provided) and affix and attest the seal to all other documents to be executed on behalf of the Corporation under its seal and shall see that the books, reports, statements, certificates and other documents and records required by law to be kept and filed are properly kept and filed; shall have general charge of the stock transfer books of the Corporation; shall authenticate records of the Corporation when such authentication is required; and in general, shall perform all the duties incident to the office of Secretary and such other duties as from time to time may be assigned to the Secretary by the Board of Directors or the Chairman of the Board and Chief Executive Officer. The Board of Directors or the Chairman of the Board and Chief Executive Officer may designate one or more Assistant Secretaries who shall have such of the authority and perform such of the duties of the Secretary as may be provided in these Bylaws or assigned to them by the Board of Directors or the Chairman of the Board and Chief Executive Officer. During the Secretary’s absence or inability, the Secretary’s authority and duties shall be possessed by such Assistant Secretary or Assistant Secretaries as the Board of Directors or the Chairman of the Board and Chief Executive Officer may designate.

     Section 4.10. Removal. Any officer or agent of the Corporation may be removed by the affirmative vote of a majority of the Board of Directors whenever, in their judgment, the best interests of the Corporation would be served thereby. Any officer or agent appointed by the Chairman of the Board and Chief Executive Officer may be removed by him or her whenever, in such person’s judgment, the best interests of the Corporation would be served thereby. No elected officer shall have any contractual rights against the Corporation for compensation by virtue of such election beyond the date of the election of such person’s successor, such person’s death, such person’s resignation or such person’s removal, whichever event shall first occur, except as otherwise provided in an employment contract or under an employee benefit plan.

     Section 4.11. Vacancies. A newly created elected office and a vacancy in any elected office because of death, resignation, or removal may be filled by the Board of Directors for the

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unexpired portion of the term at any meeting of the Board of Directors. Any vacancy in an office appointed by the Chairman of the Board and Chief Executive Officer because of death, resignation, or removal may be filled by the Chairman of the Board and Chief Executive Officer.

     Section 4.12. Execution of Documents. All deeds, mortgages, bonds, contracts, and other instruments made by the Corporation may be executed on behalf of the Corporation by any officer of the Corporation (unless such power is restricted by Board resolution or by law) or by any other person or persons designated from time to time by resolution of the Board of Directors. The Secretary, when necessary, shall attest the execution thereof.

ARTICLE V.
STOCK CERTIFICATES AND TRANSFERS

     Section 5.01. Stock Certificates and Transfers. The interest of each stockholder of the Corporation shall be evidenced by certificates for shares of stock in such form as the Corporation may from time to time prescribe. The shares of the stock of the Corporation shall be transferred on the books of the Corporation by the holder thereof in person or by such person’s attorney, upon surrender for cancellation of certificates for at least the same number of shares, with an assignment and power of transfer endorsed thereon or attached thereto, duly executed, with such proof of the authenticity of the signature as the Corporation or its agents may reasonably require. The certificates of stock shall be signed, countersigned and registered in such manner as the Board of Directors may by resolution prescribe or as may otherwise be permitted by applicable law, which resolution may permit all or any of the signatures on such certificates to be in facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue. All certificates for shares shall be consecutively numbered or otherwise identified. The Secretary shall enter into the stock transfer books of the Corporation the name and address of the person to whom the shares represented by any certificate are issued, including the number of shares and the date of issuance. Each certificate for shares of stock which are subject to any restriction on transfer pursuant to the Articles, these Bylaws, applicable securities laws or any agreement among any number of stockholders or among any number of stockholders and the Corporation shall have conspicuously noted on the face or back of the certificate either the full text of the restriction or a statement of the existence of such restriction. Notwithstanding the foregoing provisions regarding share certificates, the Corporation may provide that, subject to the rights of stockholders under applicable law, some or all of any or all classes or series of the Corporation’s common or any preferred shares may be uncertificated shares.

     Section 5.02. Lost, Stolen or Destroyed Certificates. No certificate for shares of stock in the Corporation shall be issued in place of any certificate alleged to have been lost, destroyed or stolen, except on production of such evidence of such loss, destruction or theft and on delivery to the Corporation of a bond of indemnity in such amount, upon such terms and secured by such surety, as the Board of Directors or any financial officer may in its or such person’s discretion require.

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     Section 5.03. Transfers of Stock. Upon surrender to the Corporation or the transfer agent of the Corporation of a certificate for shares endorsed or accompanied by proper evidence of succession, assignment or authority to transfer and in compliance with applicable law, the Corporation or its transfer agent shall issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. Whenever any transfer of shares shall be made for collateral security, and not absolutely, it shall be so expressed in the stock transfer books of the Corporation if, when the certificates are presented to the Corporation for transfer, both the transferor and the transferee request the Corporation to do so.

     Section 5.04. Registered Stockholders. The Corporation shall be entitled to recognize the exclusive rights of a person registered on its books as the owner of shares for all purposes, including all rights deriving from such shares, and shall not be bound to recognize any equitable or other claim to, or interest in, such shares, or rights deriving from such shares, on the part of any other person, unless and until such other person becomes the record holder of such shares, whether or not it shall have express or other notice thereof, except as otherwise provided by applicable law.

ARTICLE VI.
MISCELLANEOUS PROVISIONS

     Section 6.01. Fiscal Year. The fiscal year of the Corporation shall begin on the first (1st) day of January and end on the last day of December of each year, unless otherwise determined by the Board of Directors.

     Section 6.02. Dividends. The Board of Directors may from time to time declare, and the Corporation may pay, dividends on its outstanding shares in the manner and upon the terms and conditions provided by law and the Articles.

     Section 6.03. Seal. The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization and the words “Corporate Seal, Maryland” and such words and figures as the Board of Directors may approve and adopt. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise. Section 6.04. Waiver of Notice. Whenever any notice is required to be given under the provisions of applicable statutes or of the Articles or of these Bylaws, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting of stockholders, Directors or members of a committee of Directors shall constitute a waiver of notice of such meeting, except when the person attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders, Directors or members of a committee of Directors need be specified in any written waiver of notice unless so required by the Articles of these Bylaws.

     Section 6.05. Audits. The accounts, books and records of the Corporation shall be audited upon the conclusion of each fiscal year by an independent certified public accountant selected by

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the Board of Directors, and it shall be the duty of the Board of Directors to cause such audit to be done annually.

     Section 6.06. Resignations. Any Director or any officer, whether elected or appointed, may resign at any time by giving written notice of such resignation to the Chairman of the Board and Chief Executive Officer, the President, or the Secretary, and such resignation shall be deemed to be effective as of the close of business on the date said notice is received by the Chairman of the Board and Chief Executive Officer, the President, or the Secretary, or at such later time as is specified therein. No formal action shall be required of the Board of Directors or the stockholders to make any such resignation effective.

     Section 6.07. Fixing Record Date. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders, or to receive payment of any dividend or other distribution or allotment of any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may, except as otherwise required by law, fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than ninety (90) days (and, in the case of a meeting of stockholders, not less than ten (10) days) before the date on which the action requiring the determination will be taken; PROVIDED, HOWEVER, that if no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day on which the notice of the meeting is mailed or the thirtieth (30th) day before the meeting, whichever is later, and, for determining stockholders entitled to receive payment of any dividend or other distribution or allotment of rights or to exercise any rights of change, conversion or exchange of stock or for any other purpose, the record date shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto, so long as this date shall not be more than sixty (60) days after the adoption of the resolution.

     Section 6.08. Deposits. All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation or otherwise as the Board of Directors, the Chairman of the Board and Chief Executive Officer or the Treasurer shall direct in such banks, trust companies or other depositories as the Chairman of the Board and Chief Executive Officer or the Board of Directors may select, or as may be selected by any other officer or officers or agent or agents of the Corporation to whom power in that respect shall have been delegated by the Board of Directors. For the purpose of deposit and collection for the account of the Corporation, checks, drafts and other orders for the payment of money which are payable to the order of the Corporation may be endorsed, assigned and delivered by any officer of the Corporation.

     Section 6.09. Annual Statement. The President or a Vice-President or the Treasurer shall prepare or cause to be prepared annually a full and correct statement of the affairs of the Corporation, including a balance sheet and a financial statement of operations for the preceding fiscal year, which shall be submitted at the annual meeting and shall be filed within twenty (20) days thereafter at the principal office of the Corporation.

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     Section 6.10. Form of Records. Any records maintained by the Corporation in the regular course of its business, including its stock ledger, books of account and minute books, may be kept on, or be in the form of, punch cards, magnetic tape, photographs, microphotographs or any other information storage device, provided that the records so kept can be converted into clearly legible written form within a reasonable time. The Corporation shall so convert any records so kept upon the request of any person entitled to inspect the same.

     Section 6.11. Control Share Acquisition Act. Notwithstanding any other provision of the Articles or these Bylaws, Title 3, Subtitle 7 of the MGCL, or any successor statute, shall not apply to any acquisition by any person of shares of stock of the Corporation. This section may be repealed, in whole or in part, at any time, whether before or after an acquisition of control shares and, upon such repeal, may, to the extent provided by any successor bylaw, apply to any prior or subsequent control share acquisition.

ARTICLE VII.
CONTRACTS, PROXIES, ETC.

     Section 7.01. Contracts. Except as otherwise required by law, the Articles, a Preferred Stock Designation, or these Bylaws, any contracts or other instruments may be executed and delivered in the name and on the behalf of the Corporation by such officer or officers of the Corporation as the Board of Directors may from time to time direct. Such authority may be general or confined to specific instances as the Board of Directors may determine. The Chairman of the Board and Chief Executive Officer, the President or any Senior Vice President, Executive Vice President or Vice President may execute bonds, contracts, deeds, leases and other instruments to be made or executed or for or on behalf of the Corporation. Subject to any restrictions imposed by the Board of Directors or the Chairman of the Board and Chief Executive Officer, the President and or any Senior Vice President, Executive Vice President or Vice President of the Corporation may delegate contractual powers to others under such person’s jurisdiction, it being understood, however, that any such delegation of power shall not relieve such officer of responsibility with respect to the exercise of such delegated power.

     Section 7.02. Proxies. Unless otherwise provided by resolution adopted by the Board of Directors, the Chairman of the Board and Chief Executive Officer, the President or any Senior Vice President, Executive Vice President or Vice President may from time to time appoint an attorney or attorneys or agent or agents of the Corporation, in the name and on behalf of the Corporation, to cast the votes which the Corporation may be entitled to cast as the holders of stock or other securities in any other entity, any of whose stock or other securities may be held by the Corporation, at meetings of the holders of the stock or other securities of such other entity, or to consent in accordance with applicable law, in the name of the Corporation as such holder, to any action by such other entity, and may instruct the person or persons so appointed as to the manner of casting such votes or giving such consent, and may execute or cause to be executed in the name and on behalf of the Corporation and under its corporate seal or otherwise, all such proxies, consents or other instruments as such person may deem necessary or proper in the premises.

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ARTICLE VIII.
AMENDMENTS

     Section 8.01. Amendments. The Board of Directors shall have the exclusive power to adopt, alter or repeal any provision of the Bylaws and to make new Bylaws.

ARTICLE IX.
INDEMNIFICATION AND INSURANCE

     Section 9.01. Right to Indemnification. Subject to Article Tenth of the Articles, each person who was or is made a party or is threatened to be made a party to or is involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “Proceeding”), by reason of the fact that such person, or a person of whom such person is the legal representative, is or was a Director or officer of the Corporation or, while a Director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, trustee, partner, member, agent or employee of another corporation, partnership, limited liability company, association, joint venture, trust or other enterprise, including service with respect to employee benefit plans, whether the basis of such proceeding is alleged action in an official capacity as a Director, officer, employee or agent or in any other capacity while serving as a Director, officer, employee or agent, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the MGCL, as the same exists or may hereafter be amended, against all expense, liability and loss (including attorneys’ fees, judgments, fines, amounts paid or to be paid in settlement, and excise taxes or penalties arising under the Employee Retirement Income Security Act of 1974, as in effect from time to time) reasonably incurred or suffered by such person in connection therewith if such person acted in good faith and in a manner such person reasonably believed to be in compliance with the standard of conduct set forth in Section 405 (or any successor provision) of the MGCL and such indemnification shall continue as to a person who has ceased to be a Director, officer, employee or agent and shall inure to the benefit of such person’s heirs, executors and administrators; PROVIDED, HOWEVER, that, except as provided in Section 9.02 hereof, the Corporation shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the Board of Directors. Upon the receipt of a written affirmation by the Director or officer of his good faith belief that he has met the standard of conduct necessary for indemnification, the Corporation shall pay the expenses incurred in defending any such proceeding in advance of its final disposition with any advance payments to be paid by the Corporation within 20 calendar days after the receipt by the Corporation of a statement or statements from the claimant requesting such advance or advances from time to time; PROVIDED, HOWEVER, that, if and to the extent the MGCL requires, the payment of such expenses incurred by a Director or officer in such person’s capacity as a Director or officer in advance of the final disposition of a proceeding, shall be made only upon delivery to the Corporation of an undertaking, by or on behalf of such Director or officer, to repay all amounts so advanced if it shall ultimately be determined that such Director or officer is not entitled to be indemnified under this Article IX or otherwise. The Corporation may, to the extent authorized from time to time by the Board of Directors, grant rights to indemnification, and rights to have the Corporation pay the expenses incurred in defending any proceeding in advance of its final disposition, to any employee or agent of the Corporation to the fullest extent of the provisions of

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this Article with respect to the indemnification and advancement of expenses of Directors and officers of the Corporation.

     Section 9.02. Right of Claimant to Bring Suit. If a claim under Section 9.01 is not paid in full by the Corporation within 30 calendar days after a written claim has been received by the Corporation, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such claim. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition where the required undertaking, if any is required, has been tendered to the Corporation) that the claimant has not met the standard of conduct which makes it permissible under the MGCL for the Corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the Corporation. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because the claimant has met the applicable standard of conduct set forth in the MGCL, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.

     Section 9.03. Non-Exclusivity of Rights. The right to indemnification and the payment of expenses incurred in defending a proceeding in advance of its final disposition conferred in this Article IX shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, provision of the Articles, these Bylaws, agreement, vote of stockholders or disinterested Directors or otherwise. No repeal or modification of this Article shall in any way diminish or adversely affect the rights of any Director, officer, employee or agent of the Corporation hereunder in respect of any occurrence or matter arising prior to any such repeal or modification.

     Section 9.04. Insurance. The Corporation may maintain insurance, at its expense, to protect itself and any person who is or was a Director, officer, employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any such expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the MGCL.

     Section 9.05. Severability. If any provision or provisions of this Article IX shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (i) the validity, legality and enforceability of the remaining provisions of this Article IX (including, without limitation, each portion of any Section of this Article IX containing any such provision held to be invalid, illegal or unenforceable, that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (ii) to the fullest extent possible, the provisions of this Article IX (including, without limitation, each such portion of any paragraph of this Article IX containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.

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AMENDMENT TO NO. 1 TO BY-LAWS

OF

INDIA GLOBALIZATION CAPITAL, INC.
Article III, section 3.01 of the By-laws of the Corporation is amended in its entirety to read as follows:
The number of directors of the corporation shall be five (5). By vote of a majority of the entire board of directors, the number of directors fixed by the charter or by these bylaws may be increased or decreased from time to time not exceeding five (5) nor less than one (1), but the tenure of office of a director shall not be affected by any decrease in the number of directors so made by the board. Until the first annual meeting of stockholders or until successors are duly elected and qualify, the board shall consist of the persons named as such in the charter. All the first annual meeting of stockholders and at each annual meeting thereafter, the stockholders shall elect directors to hold office until the next annual meeting or until their successors are elected and qualify. Directors need not be stockholders in the corporation.
Adopted May 25, 2005


 

AMENDMENT TO NO. 2 TO BY-LAWS

OF

INDIA GLOBALIZATION CAPITAL, INC.
     In the Bylaws, the phrase “Chairman of the Board and Chief Executive Officer” is hereby deleted each place it appears and the phrase “Chief Executive Officer” is in inserted in lieu thereof in each such place.
     Section 4.03 is deleted in its entirety and the following two paragraphs are inserted in lieu thereof:
     Section 4.03  Chairman of the Board. The Chairman of the Board shall preside at all meetings of the stockholders and of the Board of Directors and shall have such other duties as the Board of Directors shall, from time to time, determine. The Board of Directors also may elect a Vice-Chairman to act in the place of the Chairman of the board upon his or her absence or inability to act.
     Section  403A. Chief Executive Officer. The Chief Executive Officer shall be the Chief Executive Officer of the Corporation shall be responsible for the general management of the affairs of the Corporation, and shall perform all duties incidental to such person’s office which may be required by law and all such other duties as are properly required of him by the Board of Directors or the stockholders. The Chief Executive officer shall make reports to the Board of Directors and the stockholders and shall see that all orders and resolutions of the Board of Directors and of any committee thereof are carried into effect. The Chief Executive Officer shall be the President of the Corporation if no other person has been elected as the President.
 

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).

4.        CERTAIN RIGHTS OF TRUSTEE.
(a)      Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or opinion of counsel or both. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or opinion of counsel. The Trustee may consult with counsel and the advice of such counsel or any opinion of counsel shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.
(b)      The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.
(c)      The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Agreement.
(d)      The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Agreement; it shall not be accountable for the Company’s use of the proceeds from the Trust Account. Notwithstanding the effective date of this Agreement or anything to the contrary contained in this Agreement, the Trustee shall have no liability or responsibility for any act or event relating to this Agreement or the transactions related thereto which occurs prior to the date of this Agreement, and shall have no contractual obligations to the Beneficiaries until the date of this Agreement.

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

5


 

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 under any circumstance.

[REMAINDER OF PAGE DELIBERATELY LEFT BLANK]

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IN WITNESS WHEREOF, the parties have duly executed this Investment Management Trust Agreement as of the date first written above.

CONTINENTAL STOCK TRANSFER & TRUST
COMPANY, as Trustee

By:

Name:

Title:

INDIA GLOBALIZATION CAPITAL, INC.

By :

Name:                                                         
Chairman and Chief Executive Officer

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EXHIBIT A

[LETTERHEAD OF COMPANY]

[INSERT DATE]

Continental Stock Transfer
& Trust Company
17 Battery Place
New York, New York 10004
Attn: Steven Nelson

Re: TRUST ACCOUNT NO. _____________ TERMINATION LETTER

Gentlemen:

Pursuant to Section 1(i) of the Investment Management Trust Agreement between India Globalization Capital, Inc. (“Company”) and Continental Stock Transfer & Trust Company (“Trustee”), dated as of                      , 2005 (“Trust Agreement”), this is to advise you that the Company has entered into an agreement (“Business Agreement”) with                                           (“Target Business”) to consummate a business combination with Target Business (“Business Combination”) on or about [INSERT DATE]. The Company shall notify you at least 48 hours in advance of the actual date of the consummation of the Business Combination (“Consummation Date”) and shall provide you with an Officers’ Certificate in accordance with Sections 1(i) and 2(d) of the Trust Agreement.

In accordance with the terms of the Trust Agreement, we hereby authorize you to commence liquidation of the Trust Account to the effect that, on the Consummation Date, all of funds held in the Trust Account will be immediately available for transfer to the account or accounts that the Company and FBW shall direct in writing on the Consummation Date.

On the Consummation Date (i) counsel for the Company shall deliver to you written notification that (a) the Business Combination has been consummated, and (b) the provisions of Section 11-51-302(6) and Rule 51-3.4 of the CRS have been met, to the extent applicable; (ii) the Company shall deliver along with the oath and report of inspector of election certified by an independent inspector which may be the Trustee or as otherwise appointed by FBW (collectively, the “Report”); and (iii) the Company shall deliver to you written instructions with respect to the transfer of the funds held in the Trust Account (“Instruction Letter”) along with satisfactory evidence of delivery of the stock certificates from the Public Stockholders who elect to exercise their conversion rights through the Depository Trust Company, its Deposit Withdraw Agent Commission (DWAC) system or as otherwise presented to you (the “Stock Certificates”). You are hereby directed and authorized to transfer the funds held in the Trust Account immediately upon your receipt of the counsel’s letter, the Report, evidence of delivery of the Stock Certificates, the Officers’ Certificate and the Instruction Letter (the “Deliverables”) in accordance with the terms of the Instruction Letter. Notwithstanding the foregoing, upon verification of receipt by you of the Deliverables, we hereby agree and acknowledge that the Property (as defined in the Trust Agreement) in the Trust Account shall be distributed in accordance with the terms of the Instruction Letter. In the event that certain deposits held in the Trust Account may not be liquidated by the Consummation Date without penalty, you will notify the Company and FBW of the same and the Company and, if the amount set forth in clause (1) shall not have been paid in full, FBW, shall issue joint written instructions directing you as to whether such funds should remain in the Trust Account and distributed after the Consummation Date to the Company and/or FBW. Upon the distribution of all the funds in the Trust Account pursuant to the terms hereof, the Trust Agreement shall be terminated.

8


 

In the event that the Business Combination is not consummated on the Consummation Date described in the notice thereof and we have not notified you on or before the original Consummation Date of a new Consummation Date, then the funds held in the Trust Account shall be reinvested as provided in the Trust Agreement on the business day immediately following the Consummation Date as set forth in the notice.

Very truly yours,

INDIA GLOBALIZATION CAPITAL, INC.
         
By:          
    Chief Executive Officer   
          
       
By:          
    Chief Financial Officer   

9


 

EXHIBIT B

           
           
 
AUTHORIZED INDIVIDUAL(S)
FOR TELEPHONE CALL BACK
    AUTHORIZED
TELEPHONE NUMBER(S)
 
 
 
       
 
COMPANY:
       
 
 
       
 
India Globalization Capital, Inc.
       
 
4336 Montgomery Avenue
       
 
Bethesda, Maryland 20814
       
 
Attn: Ram Mukunda, Chairman
       
 
 
    (301) 983-0998  
 
 
       
 
FBW:
       
 
 
       
 
Ferris Baker Watts, Incorporated
       
 
100 Light Street
       
 
Baltimore, Maryland 21202
       
 
Attn.: Scott Bass, Vice-President
    (410) 659-2565  
 
 
       
 
 
       
 
TRUSTEE:
       
 
 
       
 
 
       
 
Continental Stock Transfer
       
 
& Trust Company
       
 
17 Battery Place
       
 
New York, NY 10004
       
 
Attn: Steven Nelson
       
 
    (212) 845-3200  
           

10

 

EXHIBIT 10.5

PROMISSORY NOTE

$100,000
Bethesda, Maryland

India Globalization Capital, Inc. (the “Maker”) promises to pay to the order of Ram Mukunda (the “Payee”) the principal sum of One Hundred Thousand Dollars and No Cents ($100,000.00) in lawful money of the United States of America, together with interest on the unpaid principal balance of this Note, on the terms and conditions described below.

1.        PRINCIPAL. The principal balance of this Note shall be repayable on the earlier of (i) April 30, 2006 or (ii) the date on which Maker consummates an initial public offering of its securities.

2.        INTEREST. The principal balance shall bear interest at the rate of four per cent per annum.

3.        APPLICATION OF PAYMENTS. All payments shall be applied first to payment in full of any costs incurred in the collection of any sum due under this Note, including (without limitation) reasonable attorneys’ fees, then to the payment in full of any late charges and finally to the reduction of the unpaid principal balance of this Note.

4.        EVENTS OF DEFAULT. The following shall constitute Events of Default:

(a)      FAILURE TO MAKE REQUIRED PAYMENTS. Failure by Maker to pay the principal of or accrued interest on this Note within five (5) business days following the date when due.

(b)      VOLUNTARY BANKRUPTCY, ETC. The commencement by Maker of a voluntary case under the Federal Bankruptcy Code, as now constituted or hereafter amended, or any other applicable federal or state bankruptcy, insolvency, reorganization, rehabilitation or other similar law, or the consent by it to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of Maker or for any substantial part of its property, or the making by it of any assignment for the benefit of creditors, or the failure of Maker generally to pay its debts as such debts become due, or the taking of corporate action by Maker in furtherance of any of the foregoing.

(c)      INVOLUNTARY BANKRUPTCY, ETC. The entry of a decree or order for relief by a court having jurisdiction in the premises in respect of maker in an involuntary case under the Federal Bankruptcy Code, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of Maker or for any substantial part of its property, or ordering the winding-up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days.

5.        REMEDIES.

(a)      Upon the occurrence of an Event of Default specified in Section 4(a), Payee may, by written notice to Maker, declare this Note to be due and payable, whereupon the principal

 


 

amount of this Note, and all other amounts payable thereunder, shall become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived, anything contained herein or in the documents evidencing the same to the contrary notwithstanding.

(b)      Upon the occurrence of an Event of Default specified in Sections 4(b) and 4(c), the unpaid principal balance of, and all other sums payable with regard to, this Note shall automatically and immediately become due and payable, in all cases without any action on the part of Payee.

6.        WAIVERS. Maker and all endorsers and guarantors of, and sureties for, this Note waive presentment for payment, demand, notice of dishonor, protest, and notice of protest with regard to the Note, all errors, defects and imperfections in any proceedings instituted by Payee under the terms of this Note, and all benefits that might accrue to Maker by virtue of any present or future laws exempting any property, real or personal, or any part of the proceeds arising from any sale of any such property, from attachment, levy or sale under execution, or providing for any stay of execution, exemption from civil process, or extension of time for payment; and Maker agrees that any real estate that may be levied upon pursuant to a judgment obtained by virtue hereof, on any writ of execution issued hereon, may be sold upon any such writ in whole or in part in any order desired by Payee.

7.        UNCONDITIONAL LIABILITY. Maker hereby waives all notices in connection with the delivery, acceptance, performance, default, or enforcement of the payment of this Note, and agrees that its liability shall be unconditional, without regard to the liability of any other party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Payee, and consents to any and all extensions of time, renewals, waivers, or modifications that may be granted by Payee with respect to the payment or other provisions of this Note, and agree that additional makers, endorsers, guarantors, or sureties may become parties hereto without notice to them or affecting their liability hereunder.

8.        NOTICES. Any notice called for hereunder shall be deemed properly given if (i) sent by certified mail, return receipt requested, (ii) personally delivered, (iii) dispatched by any form of private or governmental express mail or delivery service providing receipted delivery, (iv) sent by telefacsimile or (v) sent by e-mail, to the following addresses or to such other address as either party may designate by notice in accordance with this Section:

If to Maker:
India Globalization Capital, Inc.
4336 Montgomery Avenue
Bethesda, Maryland 20814
Attn.: John Cherin, Chief Financial Officer

If to Payee:
Ram Mukunda
4336 Montgomery Avenue
Bethesda, Maryland 20814

2


 

Notice shall be deemed given on the earlier of (i) actual receipt by the receiving party, (ii) the date shown on a telefacsimile transmission confirmation, (iii) the date on which an e-mail transmission was received by the receiving party’s on-line access provider (iv) the date reflected on a signed delivery receipt, or (vi) two (2) Business Days following tender of delivery or dispatch by express mail or delivery service.

9.        CONSTRUCTION. This Note shall be construed and enforced in accordance with the domestic, internal law, but not the law of conflict of laws, of the State of Maryland.

10.      SEVERABILITY. Any provision contained in this Note which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

IN WITNESS WHEREOF, Maker, intending to be legally bound hereby, has caused this Note to be duly executed by its Chief Executive Officer the day and year first above written.
         
  INDIA GLOBALIZATION CAPITAL, INC.


 
  By:  
/s/ John Cherin
 
   
Chief Financial Officer 
 
       
 

3

 

EXHIBIT 10.5.1
_______________________, 2005
India Globalization Capital, Inc.
4336 Montgomery Avenue
Bethesda, Maryland 20814
Re: Extension of Repayment Date for Loan to India Globalization
Capital, Inc. (the “Company”)
Gentlemen:
     This letter will confirm that for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, the due date for repayment of the loan in the amount of $100,000 made by me to the Company is hereby extended until on the sooner of (i) one year from the date the Company consummates an initial public offering of its securities or (ii) the date of consummation of a Business Combination as that term is defined in Maker’s Articles of Incorporation as may be amended and/or restated from time to time.
         
  Very truly yours,
 
 
     
  Ram Mukunda   
     
 

 

EXHIBIT 10.6

STOCK AND UNIT ESCROW AGREEMENT

STOCK ESCROW AGREEMENT, dated as of ___, 2005 (“Agreement”), by and among INDIA GLOBALIZATION CAPITAL, INC., a Maryland corporation (“Company”), RAM MUKUNDA, JOHN CHERIN, RANGA KRISHNA and those other persons named on Exhibit A hereto (collectively, the “Initial Stockholders”) and CONTINENTAL STOCK TRANSFER & TRUST COMPANY, a New York corporation (“Escrow Agent”).

WHEREAS, the Company has entered into an Underwriting Agreement, dated ___, 2005 (“Underwriting Agreement”), with Ferris, Baker Watts, Inc. (“FBW”) acting as representative of the several underwriters (collectively, the “Underwriters”), pursuant to which, among other matters, the Underwriters have agreed to purchase 9,830,000 units (“Units”) of the Company. Each Unit consists of one share of the Company’s Common Stock, par value $.0001 per share, and two Warrants, each Warrant to purchase one share of Common Stock, all as more fully described in the Company’s final Prospectus, dated ___, 2006 (“Prospectus”) comprising part of the Company’s Registration Statement on Form S-1 (File No. -___) under the Securities Act of 1933, as amended (“Registration Statement”), declared effective on ___, 2006 (“Effective Date”).

WHEREAS, the Initial Stockholders have agreed as a condition of the sale of the Units to deposit their shares of Common Stock of the Company, as set forth opposite their respective names in Exhibit A attached hereto (collectively “Escrow Shares”), in escrow as hereinafter provided.

WHEREAS, the Company and the Initial Stockholders desire that the Escrow Agent accept the Escrow Shares, in escrow, to be held and disbursed as hereinafter provided.

WHEREAS, pursuant to the terms of a Unit Purchase Agreement (“UPA”), Ram Mukunda (“Mukunda”) has agreed to purchase 166,667 Units (the “IPO Units”) in the initial public offering by the Company of its securities (the “IPO”) and deposit the IPO Units in escrow as hereinafter provided.

IT IS AGREED:

1. APPOINTMENT OF ESCROW AGENT. The Company and the Initial Stockholders hereby appoint the Escrow Agent to act in accordance with and subject to the terms of this Agreement and the Escrow Agent hereby accepts such appointment and agrees to act in accordance with and subject to such terms. Capitalized terms used in this Agreement but not defined herein will have the meanings set forth in the Registration Statement.

2. DEPOSIT OF ESCROW SHARES INTO ESCROW.

2.1 ESCROW SHARES. On or before the Effective Date, each of the Initial Stockholders shall deliver to the Escrow Agent certificates representing his respective Escrow Shares, to be held and disbursed subject to the terms and conditions of this Agreement. Each Initial Stockholder acknowledges that the certificate representing his Escrow Shares is legended to reflect the deposit of such Escrow Shares under this Agreement.

2.2 IPO UNITS. On the consummation of the IPO Mukunda shall deliver to the Escrow Agent certificates representing the IPO Units to be held and disbursed subject to the terms and conditions of this Agreement.

3. DISBURSEMENT OF THE ESCROW SHARES.

3.1 The Escrow Agent shall hold the Escrow Shares until the one hundred eightieth day following the consummation by the Company of a Business Combination (“Escrow Period”), on which date it shall, upon written instructions from each Initial Stockholder, disburse each of the Initial Stockholder’s Escrow Shares to such Initial Stockholder; provided, however, that if the Escrow Agent is notified by the Company pursuant to Section 3.3 hereof that the Company is

 


 

being liquidated at any time during the Escrow Period, then the Escrow Agent shall promptly destroy the certificates representing the Escrow Shares; provided further, however, that if, after the Company consummates a Business Combination (as such term is defined in the Registration Statement), it (or the surviving entity) subsequently consummates a liquidation, merger, stock exchange or other similar transaction which results in all of the stockholders of such entity having the right to exchange their shares of Common Stock for cash, securities or other property, then the Escrow Agent will, upon receipt of a certificate, executed by the Chief Executive Officer or Chief Financial Officer of the Company, in form reasonably acceptable to the Escrow Agent, that such transaction is then being consummated, and release the Escrow Shares to the Initial Stockholders upon consummation of the transaction so that they can similarly participate. The Escrow Agent shall have no further duties hereunder after the disbursement or destruction of the Escrow Shares and the IPO Units in accordance with this Section 3.

3.2 The Escrow Agent shall hold the IPO Units until the third business day following receipt of the certificate referred to in Section 3.3 hereof, on which date it shall, upon written instructions from Mukunda and/or his designee(s), as appropriate, disburse the IPO Units to Mukunda or his designee(s); provided, however, that if the Escrow Agent is notified by the Company pursuant to Section 3.4 hereof that the Company is being liquidated at any time prior to disbursement of the IPO Units, then the Escrow Agent shall promptly destroy the certificates representing the IPO Units; provided further, however, that if, after the Company consummates a Business Combination (as such term is defined in the Registration Statement), it (or the surviving entity) subsequently consummates a liquidation, merger, stock exchange or other similar transaction which results in all of the stockholders of such entity having the right to exchange their shares of Common Stock for cash, securities or other property, then the Escrow Agent will, upon receipt of a certificate, executed by the Chief Executive Officer or Chief Financial Officer of the Company, in form reasonably acceptable to the Escrow Agent, that such transaction is then being consummated, release the IPO Units to Mukunda or his designee(s) upon consummation of the transaction so that he or they can similarly participate.

3.3 CONSUMMATION OF A BUSINESS COMBINATION. Within thirty (30) days after the consummation by the Company of a Business Combination, the Company shall deliver to the Escrow Agent a certificate executed by the Chief Executive Officer or the Chief Financial Officer, in form reasonably acceptable to the Escrow Agent, stating that a Business Combination has been consummated, the date of the Business Combination shall have been consummated and the date that is one hundred eighty days after the date of consummation of a Business Combination.

3.4 LIQUIDATION OF THE COMPANY. The Company shall give the Escrow Agent written notification of the liquidation and dissolution of the Company in the event that the Company fails to consummate a Business Combination within the time period(s) specified in the Prospectus.

4. RIGHTS OF INITIAL STOCKHOLDERS IN ESCROW SHARES.

4.1 VOTING RIGHTS AS A STOCKHOLDER. Subject to the terms of the Insider Letter described in Section 4.4 hereof and except as herein provided, the Initial Stockholders shall retain all of their rights as stockholders of the Company during the Escrow Period, including, without limitation, the right to vote such shares.

4.2 DIVIDENDS AND OTHER DISTRIBUTIONS IN RESPECT OF THE ESCROW SHARES. During the Escrow Period, all dividends payable in cash with respect to the Escrow Shares and the IPO Units shall be paid to the Initial Stockholders, but all dividends payable in stock or other non-cash property (“Non-Cash Dividends”) shall be delivered to the Escrow Agent to hold in accordance with the terms hereof. As used herein, the term “Escrow Shares” and “IPO Units” shall be deemed to include the Non-Cash Dividends distributed thereon, if any.

4.3 RESTRICTIONS ON TRANSFER. During the Escrow Period, no sale, transfer or other disposition may be made of any or all of the Escrow Shares or the IPO Units except (i) by gift to a member of Initial Stockholder’s immediate family or to a trust, the beneficiary of which is an Initial Stockholder or a member of an Initial Stockholder’s immediate family, (ii) by virtue of the laws of descent and distribution upon death of any Initial Stockholder, or (iii) pursuant to a qualified domestic relations order; provided, however, that such permissive transfers may be implemented only upon the respective transferee’s written agreement to be bound by the terms and conditions

2


 

of this Agreement and of the Insider Letter signed by the Initial Stockholder transferring the Escrow Shares or the IPO Units. During the Escrow Period, the Initial Stockholders shall not pledge or grant a security interest in the Escrow Shares or the IPO Units or grant a security interest in their rights under this Agreement.

4.4 INSIDER LETTERS. Each of the Initial Stockholders has executed a letter agreement with FBW and the Company, dated as indicated on Exhibit A hereto, and which is filed as an exhibit to the Registration Statement (“Insider Letter”), respecting the rights and obligations of such Initial Stockholder in certain events, including but not limited to the liquidation of the Company.

5. CONCERNING THE ESCROW AGENT.

5.1 GOOD FAITH RELIANCE. The Escrow Agent shall not be liable for any action taken or omitted by it in good faith and in the exercise of its own best judgment, and may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel (including counsel chosen by the Escrow Agent), statement, instrument, report or other paper or document (not only as to its due execution and the validity and effectiveness of its provisions, but also as to the truth and acceptability of any information therein contained) which is believed by the Escrow Agent to be genuine and to be signed or presented by the proper person or persons. The Escrow Agent shall not be bound by any notice or demand, or any waiver, modification, termination or rescission of this Agreement unless evidenced by a writing delivered to the Escrow Agent signed by the proper party or parties and, if the duties or rights of the Escrow Agent are affected, unless it shall have given its prior written consent thereto.

5.2 INDEMNIFICATION. The Escrow Agent shall be indemnified and held harmless by the Company from and against any expenses, including counsel fees and disbursements, or loss suffered by the Escrow Agent in connection with any action, suit or other proceeding involving any claim which in any way, directly or indirectly, arises out of or relates to this Agreement, the services of the Escrow Agent hereunder, or the Escrow Shares and the IPO Units held by it hereunder, other than expenses or losses arising from the gross negligence or willful misconduct of the Escrow Agent. Promptly after the receipt by the Escrow Agent of notice of any demand or claim or the commencement of any action, suit or proceeding, the Escrow Agent shall notify the other parties hereto in writing. In the event of the receipt of such notice, the Escrow Agent, in its sole discretion, may commence an action in the nature of interpleader in an appropriate court to determine ownership or disposition of the Escrow Shares and the IPO Units or it may deposit the Escrow Shares and the IPO Units with the clerk of any appropriate court or it may retain the Escrow Shares and the IPO Units pending receipt of a final, non-appealable order of a court having jurisdiction over all of the parties hereto directing to whom and under what circumstances the Escrow Shares and the IPO Units are to be disbursed and delivered. The provisions of this Section 5.2 shall survive in the event the Escrow Agent resigns or is discharged pursuant to Sections 5.5 or 5.6 below.

5.3 COMPENSATION. The Escrow Agent shall be entitled to reasonable compensation from the Company for all services rendered by it hereunder. The Escrow Agent shall also be entitled to reimbursement from the Company for all expenses paid or incurred by it in the administration

3


 

of its duties hereunder including, but not limited to, all counsel, advisors’ and agents’ fees and disbursements and all taxes or other governmental charges.

5.4 FURTHER ASSURANCES. From time to time on and after the date hereof, the Company and the Initial Stockholders shall deliver or cause to be delivered to the Escrow Agent such further documents and instruments and shall do or cause to be done such further acts as the Escrow Agent shall reasonably request to carry out more effectively the provisions and purposes of this Agreement, to evidence compliance herewith or to assure itself that it is protected in acting hereunder.

5.5 RESIGNATION. The Escrow Agent may resign at any time and be discharged from its duties as escrow agent hereunder by its giving the other parties hereto written notice and such resignation shall become effective as hereinafter provided. Such resignation shall become effective at such time that the Escrow Agent shall turn over to a successor escrow agent appointed by the Company, the Escrow Shares and IPO Units held hereunder. If no new escrow agent is so appointed within the 60 day period following the giving of such notice of resignation, the Escrow Agent may deposit the Escrow Shares and IPO Units with any court it reasonably deems appropriate.

5.6 DISCHARGE OF ESCROW AGENT. The Escrow Agent shall resign and be discharged from its duties as escrow agent hereunder if so requested in writing at any time by the other parties hereto, jointly, provided, however, that such resignation shall become effective only upon acceptance of appointment by a successor escrow agent as provided in Section 5.5.

5.7 LIABILITY. Notwithstanding anything herein to the contrary, the Escrow Agent shall not be relieved from liability hereunder for its own gross negligence or its own willful misconduct.

6. MISCELLANEOUS.

6.1 GOVERNING LAW. This Agreement shall for all purposes be deemed to be made under and shall be construed in accordance with the laws of the State of New York.

6.2 THIRD PARTY BENEFICIARIES. Each of the Initial Stockholders hereby acknowledges that the Underwriters are third party beneficiaries of this Agreement and this Agreement may not be modified or changed without the prior written consent of FBW.

6.3 ENTIRE AGREEMENT. This Agreement contains the entire agreement of the parties hereto with respect to the subject matter hereof and, except as expressly provided herein, may not be changed or modified except by an instrument in writing signed by the party to the charged.

6.4 HEADINGS. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation thereof.

6.5 BINDING EFFECT. This Agreement shall be binding upon and inure to the benefit of the respective parties hereto and their legal representatives, successors and assigns.

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6.6 NOTICES. Any notice or other communication required or which may be given hereunder shall be in writing and either be delivered personally or be mailed, certified or registered mail, or by private national courier service, return receipt requested, postage prepaid, and shall be deemed given when so delivered personally or, if mailed, two days after the date of mailing, as follows:

If to the Company, to:

India Globalization Capital, Inc.
4336 Montgomery Avenue
Bethesda, Maryland 20814
Attn: Chairman

If to a Stockholder, to his address set forth in Exhibit A.

and if to the Escrow Agent, to:

Continental Stock Transfer & Trust Company 17 Battery Place
New York, New York 10004 Attn: Chairman

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

Seyfarth Shaw LLP
815 Connecticut Avenue, N.W., Suite 500
Washington, DC 20006-4004
Attn: Stanley S. Jutkowitz, Esq.

Ferris, Baker Watts, Inc.
100 Light Street
Baltimore, Maryland 21202
Attn: Richard K. Prins, Senior Vice President

and:

Gersten Savage, LLP
600 Lexington Avenue
New York, NY 10022
Attn: Jay M. Kaplowitz, Esq.

The parties may change the persons and addresses to which the notices or other communications are to be sent by giving written notice to any such change in the manner provided herein for giving notice.

5


 

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

INDIA GLOBALIZATION CAPITAL, INC.

By:

INITIAL STOCKHOLDERS:

CONTINENTAL STOCK TRANSFER
& TRUST COMPANY

By:

Name:

Title:

6


 

EXHIBIT A

                 
Name and Address of     Number     Stock   Date of
Initial Stockholder     of Shares     Certificate Number   Insider Letter
Ram Mukunda
    2,500,000         May 5, 2005
John Cherin
    537,500         May 5, 2005
Ranga Krishna
    600,000         May 5, 2005
Parveen Mukunda
    850,000          
Sudhakar Shenoy
    87,500          
Suhail Nathani
    87,500        
Shakti Sinha
    25,000          
Dr. Prabuddha Ganguli
    25,000          
Dr. Anil K. Gupta
    50,000          
Larry Pressler
    25,000          
P.G. Kakodkar
    12,500          

* With the exception of 37,500 shares issued to Mr. Cherin, 100,000 shares issued to Dr. Krishna, 12,500 shares issued to each of Messers. Shenoy and Nathani, and the shares issued to Senator Pressler and Mr. Kakodkar the share numbers reflect the original number of shares issued to the stockholder, without giving effect to a 1-for-2 reverse stock split effected September 29, 2005. Giving effect to the reverse stock split, the number of shares deposited by each of the Initial Stockholders is as follows:

         
    Number  
Initial Stockholder   of Shares  
 
       
Ram Mukunda
    1,250,000  
 
       
John Cherin
    287,500  
 
       
Ranga Krishna
    350,000  
 
       
Parveen Mukunda
    425,000  
 
       
Sudhakar Shenoy
    50,000  
 
       
Suhail Nathani
    50,000  
 
       
Shakti Sinha
    12,500  
 
       
Dr. Prabuddha Ganguli
    12,500  
 
       
Dr. Anil K. Gupta
    25,000  
 
       
Larry Pressler
    25,000  
 
       
P.G. Kakodkar
    12,500  

7

 

EXHIBIT 10.8
UNIT PLACEMENT AGREEMENT
     UNIT PLACEMENT AGREEMENT (this “Agreement”) made as of this ___ day of February, 2006 among India Globalization Capital, Inc., a Maryland corporation (the “Company”), Ferris, Baker Watts Incorporated (“ FBW ”) and the undersigned (the “Purchasers”).
     WHEREAS, the Company has filed with the Securities and Exchange Commission (“SEC”) a registration statement on Form S-1, as amended (File No. 333-124942) (the “Registration Statement”), in connection with the Company’s initial public offering (the “IPO”) of up to 9,830,000 units, each unit (“Unit”) consisting of one share of the Company’s common stock, $.0001 par value (the “Common Stock”), and (ii) two warrants (the “Warrants”), each Warrant to purchase one share of Common Stock; and
     WHEREAS, the Company desires to sell in a private placement to the Purchasers (the “Placement”) an aggregate of 170,000 units (the “Placement Units”) substantially identical to the Units being issued in the IPO pursuant to the terms and conditions hereof and as set forth in the Registration Statement, except that the Placement Units, Common Stock and Warrants to be issued in the Placement shall not be registered under the Securities Act of 1933, as amended (the “Securities Act”);
     WHEREAS, each Purchaser desires to acquire the number of Placement Units set forth opposite his name on Schedule A hereto;
     WHEREAS, the Warrants included in the Placement Units shall be governed by the Warrant Agreement filed as an exhibit to the Registration Statement; and
     WHEREAS, the Purchasers are entitled to registration rights with respect to the Common Stock and the Warrants comprising the Placement Units and the Common Stock underlying such Warrants (collectively, the “Registrable Securities”) on the terms set forth in this Agreement; and
     WHEREAS, FBW is acting as placement agent for the Placement.
     NOW, THEREFORE, for and in consideration of the premises and the mutual covenants hereinafter set forth, the parties hereto do hereby agree as follows:
     1.  Purchase of Units . The Purchasers hereby agree, directly or through nominees, to purchase an aggregate of 170,000 Placement Units at a purchase price of $6.00 per Placement Unit, or an aggregate of $1,020,000 (the “Purchase Price”). Such purchases shall be in the names and amounts set forth on Schedule A hereto.
     2.  Closing . The closing of the purchase and sale of the Placement Units (the “Closing”) will take place at such time and place as the parties may agree (the “Closing Date”), but in no event later than the date on which the SEC declares the Registration Statement effective (the “Effective Date”). On the Effective Date, the Purchasers shall pay the Purchase Price by

 


 

wire transfer of funds to an account maintained by the Company. Immediately prior to the closing of the IPO, the Company shall deposit $1,020,000 of the Purchase Price into the trust account described in the Registration Statement (the “Trust Account”). The certificates for the Common Stock and Warrants comprising the Placement Units shall be delivered to the Purchasers promptly after the closing of the IPO.
     3.  Voting of Shares . If the Company solicits approval of its stockholders of a Business Combination, the Purchasers shall vote all of the shares of the Common Stock acquired by the Purchasers (i) pursuant to this Agreement, (ii) in the IPO and (iii) in the aftermarket in favor of the Business Combination and therefore waive any redemption rights they might have with respect to certain of such shares. As used herein, a “Business Combination” shall mean an acquisition by merger, capital stock exchange, asset or stock acquisition of, or similar business combination with, one or more entities with agreements to acquire vessels or an operating business in the shipping industry selected by the Company.
     4.  Waiver of Liquidation Distributions . In connection with the Placement Units purchased pursuant to this Agreement, the Purchasers hereby waive any and all right, title, interest or claim of any kind in or to any liquidating distributions by the Company in the event of a liquidation of the Company upon the Company’s failure to timely complete a Business Combination. For purposes of clarity, any shares of Common Stock purchased in the IPO or the aftermarket by the Purchasers shall be eligible to receive any liquidating distributions by the Company.
     5.  Lock-Up Agreement . The Purchasers shall not sell, assign, hypothecate, or transfer any of the Common Stock purchased pursuant to this Agreement until the earlier of consummation of a Business Combination or liquidation of the Company. In order to enforce this covenant, the undersigned agrees, if requested by FBW, to deposit the Placement Units in an account to be established at FBW.
     6.  Representations and Warranties of the Purchasers . Each Purchaser hereby represents and warrants to the Company that:
          6.1 The Purchaser is an “accredited investor” as that term is defined in Rule 501 of Regulation D promulgated under the Securities Act.
          6.2 The Placement Units, Common Stock and Warrants are being acquired for the Purchaser’s own account, only for investment purposes and not with a view to, or for resale in connection with, any distribution or public offering thereof within the meaning of the Securities Act.
          6.3 The Purchaser has the full right, power and authority to enter into this Agreement and this Agreement is a valid and legally binding obligation of the Purchaser enforceable against the Purchaser in accordance with its terms.
     7.  Registration Rights .

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          7.1 Demand Registration . At any time and from time to time on or after the date on which the Company has publicly announced that it has entered into a letter of intent or made a comparable announcement with respect to a Business Combination, the Purchasers or their transferees holding a majority-in-interest of the Registrable Securities may make a written demand for registration under the Securities Act of all or part of their Registrable Securities (a “Demand Registration”). Any demand for a Demand Registration shall specify the number 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 Holders shall be entitled to have their Registrable Securities included in the Demand Registration.
          The Company shall, as expeditiously as possible and in any event within sixty (60) days after receipt of a request for a Demand, prepare and file with the SEC a Registration Statement on any form for which the Company then qualifies or which counsel for the Company shall deem appropriate and which form shall be available for the sale of all Registrable Securities to be registered thereunder in accordance with the intended method(s) of distribution thereof, and shall use its best efforts to cause such Registration Statement to become effective as promptly as practicable, but in no event prior to the consummation of the Business Combination.
          The Company shall not be obligated to effect more than two Demand Registrations in respect of Registrable Securities.
          7.2 “ Piggyback” Registration Rights . Subject to the last sentence of this Section 7.2, at any time after a Business Combination, if the Company shall determine to proceed with the actual preparation and filing of a new registration statement under the Securities Act in connection with the proposed offer and sale of any of its securities by it or any of its security holders (other than a registration statement on Form S-4, S-8 or other limited purpose form), the Company will give written notice of its determination to the Purchasers or their nominees. Upon the written request from a majority-in-interest of the Purchasers, within 15 days after receipt of any such notice from the Company, the Company will, except as herein provided, cause all of the Registrable Securities covered by such request (the “Requested Stock”) held by the Purchasers making such request (the “Requesting Holders”) to be included in such registration statement (each, a “Piggy-Back Registration”), all to the extent requisite to permit the sale or other disposition by the prospective seller or sellers of the Requested Stock; provided, further, that nothing herein shall prevent the Company from, at any time, abandoning or delaying any registration. If any registration pursuant to this Section 7.2 shall be underwritten in whole or in part, the Company may require that the Requested Stock be included in the underwriting on the same terms and conditions as the securities otherwise being sold through the underwriters. In such event, the Requesting Holders shall, if requested by the underwriters, execute an underwriting agreement containing customary representations and warranties by selling stockholders and a lock-up on Registrable Securities not being sold. If in the good faith judgment

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of the managing underwriter of such public offering the inclusion of all of the Requested Stock would reduce the number of shares to be offered by the Company or interfere with the successful marketing of the shares of stock offered by the Company, the number of shares of Requested Stock otherwise to be included in the underwritten public offering may be reduced pro rata (by number of shares) among the Requesting Holders and all other holders of registration rights who have requested inclusion of their securities or excluded in their entirety if so required by the underwriter. To the extent only a portion of the Requested Stock is included in the underwritten public offering, those shares of Requested Stock which are thus excluded from the underwritten public offering and any other securities of the Company held by such holders shall be withheld from the market by the Holders thereof for a period, not to exceed 90 days, which the managing underwriter reasonably determines is necessary in order to effect the underwritten public offering. At such time as the provisions of the registration rights agreement filed as an exhibit to the Registration Statement covering the shares of Common Stock acquired by the Purchasers prior to the IPO may be exercised, the exercise and procedural provisions of such agreement, rather than the provisions of Sections 7.2, 7.3 and 7.4 hereof, shall govern the Registrable Securities with respect to Piggy-Back Registrations.
          7.3 Registration Procedures. To the extent required by Sections 7.1 or 7.2, the Company will:
          (a) prepare and file with the SEC a registration statement with respect to such securities, and use its best efforts to cause such registration statement to become and remain effective until the earlier of the date on which all of the Registrable Securities included in the registration statement have been disposed of in accordance with the intended method(s) of distribution set forth in such Registration Statement or three years from the effective date;
          (b) prepare and file with the SEC such amendments to such registration statement and supplements to the prospectus contained therein as may be necessary to keep such registration statement effective until the earlier of the date on which all of the Registrable Securities included in the registration statement have been disposed of in accordance with the intended method(s) of distribution set forth in such Registration Statement or three years from the effective date;
          (c) furnish to the holders participating in such registration and to the underwriters of the securities being registered such reasonable number of copies of the registration statement, preliminary prospectus, final prospectus and such other documents as such underwriters may reasonably request in order to facilitate the public offering of such securities;
          (d) use its best efforts to register or qualify the securities covered by such registration statement under such state securities or blue sky laws of such jurisdictions as the holders may reasonably request in writing within 20 days following the original filing of such registration statement, except that the Company shall not for any purpose be required to execute a general consent to service of process or to qualify to do business as a foreign corporation in any jurisdiction wherein it is not so qualified;

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          (e) notify the holders, promptly after it shall receive notice thereof, of the time when such registration statement has become effective or a supplement to any prospectus forming a part of such registration statement has been filed;
          (f) notify the holders promptly of any request by the SEC for the amending or supplementing of such registration statement or prospectus or for additional information;
          (g) prepare and promptly file with the SEC and promptly notify such holders of the filing of such amendment or supplement to such registration statement or prospectus as may be necessary to correct any statements or omissions if, at the time when a prospectus relating to such securities is required to be delivered under the Securities Act, any event shall have occurred as the result of which any such prospectus or any other prospectus as then in effect would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading; and
          (i) advise the holders, promptly after it shall receive notice or obtain knowledge thereof, of the issuance of any stop order by the SEC suspending the effectiveness of such registration statement or the initiation or threatening of any proceeding for that purpose and promptly use its best efforts to prevent the issuance of any stop order or to obtain its withdrawal if such stop order should be issued.
          The Purchasers shall cooperate with the Company in providing the information necessary to effect the registration of the Registrable Securities, including completion of customary questionnaires.
          7.4 Expenses . The Company shall bear all costs and expenses incurred in connection with any Demand Registration pursuant to Section 7.1, any Piggy-Back Registration pursuant to Section 7.2, and all expenses incurred in performing or complying with its other obligations under this Agreement, whether or not the Registration Statement becomes effective, including, without limitation: (i) all registration and filing fees; (ii) fees and expenses of compliance with securities or “blue sky” laws (including fees and disbursements of counsel in connection with blue sky qualifications of the Registrable Securities); (iii) printing expenses; (iv) the Company’s internal expenses (including, without limitation, all salaries and expenses of its officers and employees); (v) the fees and expenses incurred in connection with the exchange listing of the Registrable Securities; (vi) National Association of Securities Dealers, Inc. fees; (vii) fees and disbursements of counsel for the Company and fees and expenses for independent certified public accountants retained by the Company (including the expenses or costs associated with the delivery of any opinions or comfort letters); (viii) the fees and expenses of any special experts retained by the Company in connection with such registration and (ix) the fees and expenses of one legal counsel selected by the holders of a majority-in-interest of the Registrable Securities included in such registration. The Company shall have no obligation to pay any underwriting discounts or selling commissions attributable to the Registrable Securities being sold by the holders thereof, which underwriting discounts or selling commissions shall be borne

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by such holders. Additionally, in an underwritten offering, all selling shareholders and the Company shall bear the expenses of the underwriter pro rata in proportion to the respective amount of shares each is selling in such offering.
     8.  Waiver of Claims; Indemnification The Purchasers hereby waive any and all rights to assert any present or future claims, including any right of rescission, against the Company, FBW or the other underwriters in the IPO with respect to their purchase of the Placement Units, and each Purchaser agrees jointly and severally to indemnify and hold the Company, FBW and the other underwriters in the IPO harmless from all losses, damages or expenses that relate to claims or proceedings brought against the Company, FBW or such other underwriters by any Purchaser of the Placement Units or their transferees, heirs, assigns or any subsequent holders of the Placement Units.
     9.  Counterparts; Facsimile . This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same instrument. This Agreement or any counterpart may be executed via facsimile transmission, and any such executed facsimile copy shall be treated as an original.
     10.  Governing Law . This Agreement shall for all purposes be deemed to be made under and shall be construed in accordance with the laws of the State of Maryland. Each of the parties hereby agrees that any action, proceeding or claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the courts of the State of Maryland or the United States District Court for the District of Maryland, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. Each of the parties hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the ___ day of February, 2006.
         
  INDIA GLOBALIZATION CAPITAL, INC.

 
  By:      
    Ram Mukunda, President and Chief Executive
Officer 
 
 
         
  FERRIS, BAKER WATTS INCORPORATED

 
  By:      
 
         
  PURCHASERS:

 
     

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SCHEDULE A

8

 

         
 
  EXHIBIT 10.10    
 
 
 
 
     
 
  February 14, 2006

Mr. Ram Mukunda
India Globalization Capital, Inc.
4336 Montgomery Ave.
Bethesda, MD 20814

Dear Ram,

      This letter will confirm and set forth the terms and conditions of engagement of Ferris, Baker Watts, Incorporated (“FBW”) and SG Americas Securities, LLC (“SG”) (collectively, the “Advisors”), by India Globalization Capital, Inc. (the “Company”) as its financial advisors in connection with the proposed purchase by the Company of the stock or assets of a target company or companies (the “Target”), by way of merger, purchase of, or exchange for all or a portion of the stock of the Target, or otherwise (the “Business Combination”). The Advisors’ services in connection with the Business Combination are hereinafter referred to as the “Engagement”. The decision to complete the Business Combination shall be at the sole discretion of the Company.

      The Advisors shall perform financial advisory services for the Company, including, without limitation and for purpose of illustration, assisting the Company in determining an appropriate acquisition strategy and tactics, evaluating the consideration that may be offered to the Target and assisting the Company in the negotiation of the financial terms and conditions of the Business Combination. Such services shall also include conducting due diligence of the target of a prospective Business Combination. In performing their services hereunder, the Advisors may rely entirely, without independent investigation, on publicly available information and such other information as may be furnished to the Advisors by the Company or the Target.

      The Company agrees to furnish to the Advisors all information concerning the Company and the proposed Business Combination which the Advisors and you reasonably deem appropriate, and to use its best efforts to cause the Target to furnish to the Advisors all information concerning the Target and to provide to the Advisors reasonable access to the Company’s officers, directors, employees, accountants, and counsel. Except as otherwise agreed to by the Company, or required by law, all information which is not publicly available will be kept confidential by the Advisors. The Company hereby represents and warrants, to the best of its knowledge, that all information furnished to the Advisors by the Company concerning the Company (excluding forward-looking information, which will be prepared using such reasonable assumptions as the Company considers appropriate) shall be complete and correct in all material respects when furnished and shall not contain any untrue statements of a material fact. In rendering its services hereunder, the Advisors will be using and relying primarily on publicly available information or other information furnished by the Company and has not and does not assume any responsibility for independent verification of such information or any independent appraisal or valuation of assets. Further, in evaluating other companies, the Advisors will be using information contained in public reports and information supplied by the Company, and have not and do not assume any responsibility for independent verification of such information or independent appraisal or valuation of assets.

      To enable the Advisors to render these services in a professional manner, the Company agrees that the Advisors shall have no responsibility to the Company, the Board of Directors, the Target or any other parties for the accuracy,

 


 

Mr. Ram Mukunda
India Globalization Capital, Inc.
  February 14, 2006
Page 2 of 4

completeness or legal sufficiency of any financial statements, memoranda or other documentation prepared by or on behalf of the Company or for verification of any of the information contained therein. Appropriate officials of the Company, as the Company may designate, will be responsible for reviewing any memoranda or other documentation prior to its use to determine that, to the best of their knowledge, it does not contain any material misstatements or omissions. The Company recognizes that the Advisors’ ability to successfully perform the services contemplated herein is to a great extent dependent upon the Company’s timely cooperation.

      For the Advisors’ services in connection with the Engagement, the Company shall pay to FBW, who shall pay a portion to SG, pursuant to their agreed-upon allocation, an aggregate fee equal to 2.0% of the Aggregate Consideration (as defined below) paid in connection with the Business Combination (the “Business Combination Fee”). The Business Combination Fee shall be capped at $1,500,000 and shall constitute the Advisors’ compensation for the Engagement and shall be paid upon consummation of the Business Combination; provided that, to the extent that a portion of the Aggregate Consideration constitutes earnouts or is subject to other contingencies, the Business Combination Fee with respect to such Aggregate Consideration shall only be due and payable when such Aggregate Consideration is paid.

      “Aggregate Consideration”, used herein, means all payments of any type to or for the benefit of the Target, its shareholders, creditors, or employees (including assumption or acquisition or refinancing of debt obligations of the Target or related entities as well as any earnout provisions) in the Business Combination whether in cash or by delivery of notes or other securities or property of any type, including amounts paid into escrow. For purposes of determining Aggregate Consideration, each share of Company common stock issued or issuable in connection with the Business Combination shall be valued at the 10 day volume-weighted average price of the Company’s common stock, as computed by Bloomberg, beginning on the fifth trading day immediately preceding the day on which the Business Combination is consummated.

      In addition to the foregoing fee, the Company will reimburse each of the Advisors promptly, on a monthly basis, for all of the reasonable out-of-pocket expenses incurred by the Advisors in connection with the Engagement, whether or not the Business Combination is consummated; provided, however, that such expenses for the Advisors in aggregate shall not exceed $25,000 without the prior consent of the Company.

      Whether or not the Business Combination is effected, the Company will indemnify and hold harmless each of FBW and SG and each of its officers, directors, employees, attorneys, consultants, agents, servants, parents, affiliates, successors and assigns, jointly and severally (hereinafter collectively “Indemnitees”), from and against any and all losses, claims, damages, liabilities, awards, costs and expenses, including but not limited to reasonable attorneys’ fees (hereinafter collectively “Claim” or “Claims”) to which Indemnitees may become subject by virtue of, in connection with, resulting from, or arising out of the Engagement. Without limitation — but in illustration — of the foregoing, Claims shall include reasonable legal and other expenses, including the cost of any investigation and preparation incurred by Indemnitees in connection with any pending or threatened Claim by any person or entity, whether or not it results in a loss, damages, liability or award. Indemnitees shall be indemnified and held harmless by the Company for any and all Claims whether they arise under contract; foreign, federal, state or local law or ordinance; common law; or otherwise.

      Notwithstanding anything above to the contrary: (1) the Advisors shall promptly notify the Company after any Claim is asserted, and the Company shall have the right, upon notification to FBW or SG, as applicable, within 10 days thereafter, to assume the defense of such Claim or action and to appoint counsel reasonably satisfactory to Indemnitees to conduct such defense, provided that (A) all expenses and costs related thereto shall be borne by the Company; and (B) the Indemnitees shall have the right to retain separate counsel, but the fees and expenses of such counsel shall be at the expense of the Indemnified Parties, unless (i) the Company has failed to assume the defense and employ counsel as required above, or (ii) the named parties to any such action (including any impleaded parties) include both (A) the Indemnitees and (B) the Company, and the Indemnitees shall have reasonably determined that the defenses available to them are not available to the Company and/or may not be consistent with the best interests of the Company or the Indemnitees (in which case the Company shall not have the right to assume the defense of such action on behalf of the Indemnitees) and (2) the Company shall not be liable to any Indemnitee for any Claim to the extent that a court having jurisdiction shall have determined by a final, non-appealable, judgment, that such Claim resulted from the gross negligence or

 


 

Mr. Ram Mukunda
India Globalization Capital, Inc.
  February 14, 2006
Page 3 of 4

willful misconduct of such Indemnitee.

      The foregoing commitment of the Company regarding indemnification will survive any termination of the authorization provided by this letter.

      You agree to promptly notify FBW and SG of any assertion against FBW, SG, the Company, or any other person of any Claim or the commencement of any action or proceeding relating to the services comprising the Engagement.

      The term of the Engagement will commence on the date of the Company’s acceptance of this letter and will expire 24 months after the effective date of the Company’s public offering or upon consummation of a Business Combination(s) with Aggregate Consideration equal to at least 80% of the Company’s net assets. The Engagement may be terminated (except as provided above with respect to reimbursement of expenses and indemnification) by either of SG or FBW at any time with or without cause, upon 30 days written notice to the Company. In the event that only one of the Advisors terminates its Engagement with the Company, such termination shall not affect the Engagement between the Company and the remaining Advisor.

      The Company agrees that FBW and SG have the right to place advertisements in financial and other newspapers and journals at the Advisors’ own expense describing the Advisors’ services to the Company in connection with the Engagement if the Business Combination is consummated, provided that the Advisors will submit a copy of any such advertisement to the Company for its prior approval, which approval shall not be unreasonably withheld or delayed.

      The Advisors’ engagement by the Company is for the limited purposes set forth in this letter, and the rights and obligations of each of FBW, SG and the Company are defined by this letter agreement. Each of FBW, SG and the Company agrees that none of the other parties has any fiduciary duty to it or its stockholders, officers and directors as a result of the engagement described in this letter agreement.

      The Advisors will assume that all financial forecasts have been reasonably prepared and reflect the best then currently available estimates and judgments of the Company’s or the potential target’s management as to the expected future financial performance of the Company or any potential target.

      The Company acknowledges that all advice given by the Advisors in connection with this Engagement is for the benefit and use of the Company in considering the Business Combination. The Company agrees that no such advice shall be used for any other purpose or be disclosed, reproduced, disseminated, quoted or referred to at any time, in any manner or for any purpose, nor shall any public references to the Advisors be made by or on behalf of the Company, in each case without the Advisors’ prior written consent, which consent shall not be unreasonably withheld.

      Each Advisor may delegate the performance of any of the above services to an affiliate or subsidiary of such Advisor. It is expressly understood and agreed that neither Advisor is undertaking to provide any advice relating to legal, regulatory, accounting or tax matters. In furtherance thereof, the Company acknowledges and agrees that (a) it and its affiliates have relied and will continue to rely on the advice of its own legal, regulatory, tax and accounting advisors for all matters relating to the Business Combination, and all other matters and (b) neither it, nor any of its affiliates has received, or has relied upon, the advice of either Advisor or any of its affiliates regarding legal, regulatory, tax or accounting matters. In addition, neither Advisor shall be liable for the acts or omissions of the other Advisor in connection with this agreement or the Engagement.

      The Company acknowledges and agrees that the Advisors have been retained to act as financial advisors to the Company, and not as advisors to or agents of any other person, and that the Company’s engagement of the Advisors is not intended to confer rights upon any person not a party to this Agreement (including shareholders, employees or creditors of the Company) as against either Advisor or its affiliates, or their respective directors, officers, employees or agents.