indiaglobal-424b5110209.htm
Filed
Pursuant to Rule 424(b)(5)
Registration
No. 333-160993
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Title
of Each Class of Securities Offered
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Proposed
Maximum Aggregate
Offering
Price
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Amount
of
Registration Fee(1)
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Common
stock, par value $0.0001 per share
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$4,000,000
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$223.20
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(1)
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Pursuant
to Rule 457(o) under the Securities Act of 1933, as amended (the
“Securities Act”), the filing fee was calculated based on a maximum
aggregate offering price. The filing fee, calculated in accordance with
Rule 457(r) of the Securities Act, has been previously transmitted to
the Securities and Exchange Commission in connection with the securities
offered from Registration Statement File No. 333-160993 by means of
this prospectus supplement.
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PROSPECTUS
SUPPLEMENT
(To
prospectus dated September 16, 2009)
India
Globalization Capital, Inc.
$4,000,000
Common
Stock
We have entered into an ATM Agency Agreement with Enclave
Capital LLC (“Enclave” or the “Agent”), relating to shares of our common stock,
par value $0.0001 per share.
Under the agency agreement, we may offer and sell shares of
our common stock having an aggregate offering price of up to $4 million from
time to time through Enclave, as our distribution agent. Sales of the shares, if
any, will be made by means of ordinary brokers’ transactions on the NYSE Amex at
market prices or as otherwise agreed with Enclave.
Our common stock is listed on the NYSE Amex under the symbol "IGC".
On November 2, 2009, the last reported sale price of our common stock as
reported on the NYSE Amex was $1.60 per share. Based on such
last reported sale price, as of the date hereof, the aggregate market value of
our outstanding common stock held by non-affiliates is approximately
$15,950,328, based on 12,363,991 shares of outstanding common stock, of which
approximately 9,968,955 shares are held by non-affiliates. As of the date
hereof we have sold an aggregate of $2,510,630 worth of securities pursuant to
General Instruction I.B.6 of Form S-3 during the prior 12 calendar month period
that ends on and includes the date hereof.
Investing in our common stock
involves risks. Before investing in our common stock you should carefully
consider the risk factors described in “Risk Factors” in this prospectus
supplement, and in other documents incorporated by reference, including our
Annual Report on Form 10-K for our fiscal year ended March 31,
2009.
Neither the Securities and Exchange
Commission nor any state securities commission has approved or disapproved of
these securities or determined if this prospectus supplement or the accompanying
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
We urge
you to carefully read this prospectus supplement and the accompanying prospectus
which will describe the terms of the offering before you make your investment
decision.
Enclave
will receive from us a commission of 3% of the gross proceeds of any shares
sold through it pursuant to this prospectus supplement. After payment
of the commission to Enclave, and the payment of expenses of the offering which
we estimate to be approximately $50,000, the net proceeds to us of the offering
will be approximately $3,830,000. Please see “Plan of Distribution”
in this prospectus supplement. Enclave will use its commercially
reasonable efforts to place on our behalf any shares to be offered by us
under the ATM Agency Agreement and is nor required to sell any specific number
or dollar amount of shares.
Enclave
Capital LLC
The date
of this prospectus supplement is November 2 ,
2009.
Prospectus
Supplement
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Page
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S-1
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S-2
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S-3
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S-4
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S-3
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S-4
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S-5
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S-5
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S-5
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S-6
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S-6
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S-7
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S-7
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S-7
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S-7
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Prospectus
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Page
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3
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6
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7
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7
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7
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8
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8
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11
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12
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13
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14
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14
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In making
your investment decision, you should rely only on the information contained in
or incorporated by reference in this prospectus supplement and in the
accompanying prospectus. Neither India Globalization Capital nor Enclave has
authorized anyone to provide you with different information. If anyone provides
you with different or inconsistent information, you should not rely on it.
Neither India Globalization Capital nor Enclave is making an offer to sell these
securities in any jurisdiction where the offer or sale is not permitted. You
should assume that the information contained in or incorporated by reference
into this prospectus supplement and the accompanying prospectus or in any free
writing prospectus that we may provide to you is accurate only as of the date of
those documents. Our business, financial condition, results of operations and
prospects may have changed since those dates.
This supplement amends and supersedes the prospectus supplement dated
October 13, 2009.
Unless
otherwise stated or the context otherwise requires, references in this
prospectus supplement or the accompanying prospectus to “IGC,” “we,” “our,” “us”
or similar references are to India Globalization Capital, Inc. and its
consolidated subsidiaries.
This
document consists of two parts. The first part is this prospectus supplement,
which describes the specific terms of this offering and other matters relating
to us. The second part is the accompanying prospectus, which gives more general
information about securities we may offer from time to time, some of which may
not apply to this offering. This prospectus supplement and the accompanying
prospectus are part of a “shelf” registration statement that we filed with the
Securities and Exchange Commission (or the SEC) using the SEC’s shelf
registration rules.
You
should read both this prospectus supplement and the accompanying prospectus
together with additional information described in this prospectus supplement in
the section titled “Where You Can Find More Information.” If there is any
inconsistency between the information in this prospectus supplement and the
accompanying prospectus, you should rely on the information contained in this
prospectus supplement.
You
should rely only on the information contained or incorporated by reference in
this prospectus supplement, the accompanying prospectus and any free writing
prospectus prepared by or on behalf of us. We have not, and Enclave has not,
authorized any other person to provide you with different information. If anyone
provides you with different or inconsistent information, you should not rely on
it. We are not, and Enclave is not, making an offer to sell these securities in
any jurisdiction where the offer or sale is not permitted.
The rules
of the Securities and Exchange Commission (SEC) allow us to incorporate by
reference certain information into this prospectus supplement and into the
accompanying prospectus. You should read this prospectus supplement, any related
free writing prospectus that we may authorize and the accompanying prospectus,
including the documents incorporated by reference that are described under
“Incorporation by Reference” in this prospectus supplement. You should carefully
consider the information described under “Risk Factors” on page S-4 of this
prospectus supplement and under “Risk Factors” on page 7 of the accompanying
prospectus before making an investment decision.
Any
statement made in this prospectus supplement, in the accompanying prospectus or
in any document incorporated or deemed to be incorporated by reference in this
prospectus supplement or the accompanying prospectus will be deemed to be
modified or superseded for purposes of this prospectus supplement to the extent
that a statement contained in this prospectus supplement or in any other
subsequently filed document that is also incorporated or deemed to be
incorporated by reference in this prospectus supplement or the accompanying
prospectus modifies or supersedes that statement. Any statement so modified or
superseded will not be deemed, except as so modified or superseded, to
constitute a part of this prospectus supplement or the accompanying
prospectus.
The
information in this prospectus supplement is accurate as of the date on the
front cover. You should not assume that the information contained in this
prospectus supplement or in the accompanying prospectus is accurate as of any
date other than the date on the front of the applicable document, or that
information incorporated by reference is accurate as of any date other than the
date of the document incorporated by reference. Our business, financial
condition, results of operations and prospects or other important facts or
circumstances may have changed since those dates.
The Private Securities
Litigation Reform Act of 1995 provides a safe harbor for forward-looking
statements. This prospectus supplement, the accompanying prospectus, and the
documents incorporated herein or therein by reference contain “forward-looking
statements” within the meaning of Section 27A of the Securities Act of
1933, as amended (the “Securities Act”) and Section 21E of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”). Additionally, we or our
representatives may, from time to time, make other written or verbal
forward-looking statements. In this prospectus supplement, and the documents
incorporated by reference herein, we discuss plans, expectations and objectives
regarding our business, financial condition and results of operations. Without
limiting the foregoing, statements that are in the future tense, and all
statements accompanied by terms such as “believe,” “project,” “expect,” “trend,”
“estimate,” “forecast,” “assume,” “intend,” “plan,” “target,” “anticipate,”
“outlook,” “preliminary,” “will likely result,” “will continue,” and variations
thereof and similar terms are intended to be “forward-looking statements” as
defined by federal securities laws. We caution you not to place undue reliance
on forward-looking statements, which are based upon assumptions, expectations,
plans and projections. Forward-looking statements are subject to risks and
uncertainties, including those identified in the “Risk Factors” included in this
prospectus supplement and in the documents incorporated by reference herein,
that may cause actual results to differ materially from those expressed or
implied in the forward-looking statements. Forward-looking statements speak only
as of the date when they are made. Except as required by applicable law, we do
not undertake any obligation to update forward-looking statements to reflect
events, circumstances, changes in expectations, or the occurrence of
unanticipated events after the date of those statements. We intend that all
forward-looking statements made will be subject to safe harbor protection of the
federal securities laws pursuant to Section 27A of the Securities Act and
Section 21E of the Exchange Act.
Forward-looking
statements are based upon, among other things, our assumptions with respect
to:
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competition
in the road building sector;
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legislation
by the government of India;
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general
economic conditions and the Indian growth
rates;
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our
ability to win licenses, contracts and
execute;
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current
and future economic and political
conditions;
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overall
industry and market performance;
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the
impact of accounting
pronouncements;
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management’s
goals and plans for future operations;
and
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·
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other
assumptions described in this report underlying or relating to any
forward-looking statements.
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You
should consider the limitations on, and risks associated with, forward-looking
statements and not unduly rely on the accuracy of predictions contained in such
forward-looking statements. As noted above, these forward-looking statements
speak only as of the date when they are made. Moreover, in the future, we may
make forward-looking statements through our senior management that involve the
risk factors and other matters described in our most recent Annual Report on
Form 10-K and in this prospectus supplement, as well as other risk factors
subsequently identified, including, among others, those identified in our
filings with the SEC in our Quarterly Reports on Form 10-Q and our Current
Reports on Form 8-K
The following summary is
provided solely for your convenience. It is not intended to be complete. You
should read carefully this entire prospectus supplement, the accompanying
prospectus and all the information included or incorporated by reference herein
or therein carefully, especially the risks discussed in the section titled “Risk
Factors” beginning on page S-4 of this prospectus supplement and in the
documents incorporated by reference herein.
Our
Business
IGC, a
Maryland corporation, was organized on April 29, 2005 as a blank check
company formed for the purpose of acquiring one or more businesses with
operations primarily in India through a merger, capital stock exchange, asset
acquisition or other similar business combination or acquisition. On March 8,
2006, we completed an initial public offering. On February 19, 2007,
we incorporated India Globalization Capital, Mauritius, Limited (IGC-M), a
wholly owned subsidiary, under the laws of Mauritius. On March 7,
2008, we consummated the acquisition of 63% of the equity of Sricon
Infrastructure Private Limited (Sricon) and 77% of the equity of Techni Bharathi
Limited (TBL). Sricon is an engineering and construction company that is engaged
in three business areas: 1) civil construction of highways and other heavy
construction, 2) mining and quarrying and 3) the construction and maintenance of
high temperature cement and steel plants. TBL is an engineering and
construction company engaged in the execution of civil construction and
structural engineering projects.
The
shares of the two Indian companies, Sricon and TBL, are held by
IGC-M. On February 19, 2009 IGC-M beneficially purchased 100%
of IGC Mining and Trading, Limited (IGC-IMT based in Chennai,
India). IGC-IMT was formed on December 16, 2008 as a privately held
start-up company engaged in the business of mining and trading. Its
current activity is to operate a shipping hub and export iron ore to
China. On July 4, 2009, IGC-M beneficially purchased 100% of IGC
Materials, Private Limited (IGC-MPL based in Nagpur, India), which will conduct
IGC’s quarrying business, and 100% of IGC Logistics, Private Limited (IGC-LPL
based in Nagpur, India), which will be involved in the transport and delivery of
ore, cement, aggregate and other material. Each of IGC-IMT,
IGC-MPL and IGC-LPL were formed by third parties at the behest of IGC-M to
facilitate the creation of the subsidiaries, and the purchase price paid for
each of IGC-IMT. IGC-MPL and IGC-LPL was equal to the expenses incurred in
incorporating the respective entities with no premium paid. No
officer or director of IGC had a financial interest in the subsidiaries at the
time of their acquisition by IGC-M. India Globalization
Capital, Inc. (the Registrant, the Company, or we) and its subsidiaries are
significantly engaged in one segment, infrastructure construction.
Our
principal executive offices are located at 4336 Montgomery Ave, Bethesda,
Maryland 20814 and our telephone number is (301) 983-0998.
We
maintain a website at http:/
www.indiaglobalcap.com. The information contained on our website is not
incorporated by reference in this prospectus supplement or the accompanying
prospectus, and you should not consider it a part of this prospectus supplement
or the accompanying prospectus.
For
additional information about us, you should refer to the information described
in “Where You Can Find More Information” in this prospectus
supplement.
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Issuer
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India
Globalization Capital, Inc.
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Common
stock offered
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Shares
of common stock, $0.0001 par value per share having an aggregate offering
price of up to $4.0 million.
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Common
stock offered outstanding prior to this offering
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12,363,991
shares(1).
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Manner
of Offering
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Commercially
reasonable efforts offering that may be made from time to time through our
placement agent, Enclave Capital LLC. See “Plan of
Distribution” on page S-6.
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Use
of proceeds
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We
expect to use the net proceeds from this offering for working capital,
repayment of indebtedness and other general corporate
purposes. See “Use of Proceeds” on page
S-4.
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NYSE
Amex Trading Symbol
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IGC.
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Risk
factors
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An
investment in our common stock involves significant risks. Before making
an investment in our common stock, you should carefully review the "Risk
Factors" section beginning on page S-4, as well as the other
documents incorporated by reference into this prospectus supplement and
the accompanying prospectus.
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(1) Based
on 12,363,991 shares outstanding as of October 7, 2009. Excludes
12,125,102 shares of our common stock issuable upon the exercise of
warrants outstanding as of October 7, 2009, 1,491,000 shares of our common stock
issuable upon the exercise of options issued under our stock incentive plan and
outstanding as of October 7, 2009, and 67,000 shares of common stock
available for future issuance under our stock incentive plan as of October 7,
2009.
You should carefully consider the
risk factors described in our Annual Report on Form 10-K for the year ended
March 31, 2009, as well as the other information contained or incorporated
by reference in this prospectus supplement and the accompanying prospectus, and
the risk factors set forth below before deciding to invest in the common stock.
Such risks and uncertainties are not the only ones we face. Additional risks and
uncertainties not presently known to us or that we currently deem immaterial may
also impair our business operations. The occurrence of any of the events or
actions described in these risk factors may have a material adverse effect on
our business or financial performance.
Risks
Related To This Offering
Future
sales of common stock by us could cause our stock price to decline and dilute
your ownership of us.
There
are currently outstanding warrants to purchase 12,175,102 shares of our
common stock and options to purchase 1,491,000 shares of our common
stock. We are not restricted from issuing additional shares of our
common stock or preferred stock, including any securities that are convertible
into or exchangeable for, or that represent the right to receive, common stock
or preferred stock or any substantially similar securities. The market price of
our common stock could decline as a result of sales of a large number of shares
of our common stock by us in the market after this offering or the perception
that such sales could occur. If we raise funds by issuing additional
securities in the future or the outstanding warrants or options to purchase our
common stock are exercised, the newly issued shares will also dilute
your percentage ownership in us.
The
market price for our common stock after this offering may be lower than the
offering price, and our stock price may be volatile.
The
price at which the shares of our common stock may sell in the public market
after this offering may be lower than the price at which they are sold. In
addition, the trading volume in our common stock may fluctuate and cause
significant price variations to occur. Fluctuations in our stock price may not
be correlated in a predictable way to our performance or operating results. Our
stock price may fluctuate as a result of a number of events and factors such as
those described elsewhere in this "Risk Factors" section, events described or
incorporated by reference in this prospectus supplement and the accompanying
prospectus, and other factors that are beyond our control. If the market price
of our common stock declines significantly after this offering, you may be
unable to resell your shares at or above the public offering price.
In
addition, the stock market, in general, has historically experienced significant
price and volume fluctuations. The overall weakness in the economy and the
current financial crisis have recently contributed to the extreme volatility of
the markets, including the market price of our common stock. These fluctuations
are often unrelated to the operating performance of particular companies. These
broad market fluctuations may cause declines in the market price of our common
stock. When the market price of a company’s common stock drops significantly,
stockholders often institute securities class action lawsuits against the
company. A lawsuit against us could cause us to incur substantial costs and
could divert the time and attention of our management and other resources from
our business.
Our
publicly filed reports are subject to review by the SEC, and any significant
changes or amendments required as a result of any such review may result in
material liability to us and may have a material adverse impact on the trading
price of our common stock.
The
reports of publicly traded companies are subject to review by the SEC from time
to time for the purpose of assisting companies in complying with applicable
disclosure requirements, and the SEC is required to undertake a comprehensive
review of a company’s reports at least once every three years under the
Sarbanes-Oxley Act of 2002. SEC reviews may be initiated at any time. We could
be required to modify, amend or reformulate information contained in prior
filings as a result of an SEC review. Any modification, amendment or
reformulation of information contained in such reports could be significant and
result in material liability to us and have a material adverse impact on the
trading price of our common stock.
We
estimate that the net proceeds from the sale of the shares of common stock we
are offering will be approximately $3.83
million. We intend to use the net proceeds from the sale of
securities offered in this prospectus supplement for working capital, repayment
of indebtedness and other general corporate purposes.
Each
holder of common stock is entitled to one vote for each share held. Shareholders
do not have the right to cumulate their votes in elections of directors.
Accordingly, holders of a majority of the issued and outstanding common stock
will have the right to elect all of our directors and otherwise control the
affairs of IGC.
Holders
of common stock are entitled to receive dividends on a pro rata basis upon
declaration of dividends by our board of directors, provided that required
dividends, if any, on any outstanding preferred stock have been provided for or
paid. Dividends are payable only out of funds legally available for the payment
of dividends.
Upon a
liquidation, dissolution or winding up of IGC, holders of our common stock will
be entitled to a pro rata distribution of our assets, after payment of all
amounts owed to our creditors, and subject to any preferential amount payable to
holders of preferred stock, if any. Holders of our common stock have no
preemptive, subscription, conversion, redemption or sinking fund
rights.
We have
never declared or paid cash dividends on our common stock and, while this policy
is subject to periodic review by our board of directors, we currently intend to
retain any earnings for use in our business and do not anticipate paying cash
dividends in the foreseeable future. Our ability to declare dividends may also
from time to time be limited by the terms of our existing or future credit
facilities.
The
following table shows, for the last eight fiscal quarters, the high and low
closing prices per share of our Common Stock as quoted on the NYSE
Amex:
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Quarter
ended 2007
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High
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Low
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December
31
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$
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5.94
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$
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5.69
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2008
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High
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Low
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March
31
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$
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5.90
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$
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3.60
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June
30
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$
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5.90
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$
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3.81
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September
30
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$
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4.99
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$
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4.50
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December
31
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$
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4.78
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$
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0.70
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|
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2009
|
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High
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Low
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March
31
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$
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1.10
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$
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0.33
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June 30
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$
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1.25
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$
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1.12
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September
30
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$
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1.86
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$
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0.88
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On
November 2, 2009, the closing price of our common stock, as reported by the NYSE
Amex, was $1.60 per share.
The
following table sets forth our capitalization as of March 31, 2009 (1) on an
actual basis and (2) on an as adjusted basis to reflect the assumed sale of our
common stock in the aggregate amount of $4,000,000 offered at an assumed price
of $ 1.60 per share, less
estimated sales commissions and offering expenses payable by us. The
amounts and prices at which will sell shares of our common stock in this
offering will vary depending largely on the market price of our common stock at
the time of each sale.
You
should read this table in conjunction with our financial statements incorporated
herein by reference into this prospectus supplement and the accompanying
prospectus.
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As
of
March
31, 2009
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Actual
|
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As
Adjusted
|
|
|
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(unaudited)
(in
thousands)
|
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Cash
and cash equivalents
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$
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2,129,365
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$
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5,959,365
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Long-term
debt, net of current portion
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1,497,458
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1,497,458
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Stockholders’
equity:
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Common
stock)
|
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1,009
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1,259
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Additional
paid-in capital
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33,186,530
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37,016,280
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Accumulated
other comprehensive income
|
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(4,929,581
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)
|
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(4,929,581
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)
|
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Accumulated
deficit
|
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(4,662,689
|
)
|
|
|
(4,662,689
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)
|
|
Total
stockholders’ equity
|
|
|
23,595,269
|
|
|
|
27,425,269
|
|
|
Total
capitalization
|
|
$
|
51,832,513
|
|
|
$
|
55,662,513
|
|
We have
entered into an ATM Agency Agreement with Enclave Capital LLC under
which we may issue and sell shares of our common stock from time to time through
Enclave as our sales agent. Sales of the shares, if any, will be made by means
of ordinary brokers’ transactions on the NYSE Amex at market prices, privately
negotiated transactions, crosses or block transactions and such other
transactions as may be agreed between us and Enclave, including a combination of
any of these transactions.
When
requested by us, Enclave will offer the shares of common stock subject to the
terms and conditions of the agency agreement, which may be on a daily basis
for periods of time, or otherwise, or as we may otherwise agree with
Enclave. We will designate the maximum amount of shares of common stock to be
sold through Enclave when we request Enclave to do so. Enclave has agreed,
subject to the terms and conditions of the agency agreement, to use its
commercially reasonable efforts to place on our behalf all of the
designated shares of common stock. We may instruct Enclave not to place shares
of common stock at or below a price designated by us. We or Enclave may suspend
the offering of shares of common stock under the agency agreement
upon proper notice to the other party.
We will
pay Enclave a commission equal to 3% of the gross proceeds for the shares
Enclave places as our agent pursuant to this prospectus supplement. The
estimated offering expenses payable by us, in addition to such commission, are
approximately $50,000, which includes legal, accounting and printing costs and
various other fees associated with registering the shares of common
stock. We have agreed to reimburse Enclave for expenses it incurs in
connection with the offering up to a maximum of $25,000, which amount is
included in our estimate of offering expenses.
Enclave
will provide written confirmation to us following the close of trading on the
NYSE Amex each day on which shares of common stock are sold under the agency
agreement. Each confirmation will include the number of shares sold
on that day, the aggregate gross proceeds of such sales and the commission
payable by us to Enclave. Settlement for sales of common stock will
occur, unless otherwise agreed, on the third business day following the date on
which such sales were made.
In
connection with the sale of our common stock on our behalf, Enclave may be
deemed to be an “underwriter” within the meaning of the Securities Act of 1933,
and the compensation paid to Enclave may be deemed to be underwriting
commissions or discounts.
We have
agreed to indemnify Enclave against certain liabilities, including liabilities
under the Securities Act of 1933, as amended, and liabilities arising from
breaches of representations and warranties contained in the agency agreement. We
have also agreed to contribute to payments Enclave may be required to make in
respect of such liabilities.
If
Enclave or we have reason to believe that the exemptive provisions set forth in
Rule 101(c)(1) of Regulation M under the Securities Exchange Act of 1934 are not
satisfied, that party will promptly notify the other and sales of common stock
under the agency agreement will be suspended until that or other exemptive
provisions have been satisfied in the judgment of Enclave and us.
The
offering of shares of common stock pursuant to the agency agreement will
terminate upon the earlier of (i) the sale of all shares of common stock subject
to the agency agreement, (ii) the termination of the agency agreement according
to its terms by either Enclave or us, or (iii) the third anniversary of the
effective date of the agency agreement.
It is
anticipated that Enclave will provide various investment banking, financial
advisory and other services to us and our affiliates for which services it may
receive customary fees.
Seyfarth
Shaw LLP, Chicago, IL, will issue an opinion about the validity of the shares of
common stock offered by this prospectus supplement.
The
consolidated financial statements and financial statement schedule of India
Globalization Capital, Inc. and subsidiaries as of March 31, 2008 and 2007, and
for each of the years in the two-year period ended March 31, 2009, have been
incorporated by reference herein and in the registration statement in reliance
upon the reports of Yoganandh & Ram, an independent registered public
accounting firm, incorporated by reference herein, and upon the authority of
said firms as experts in accounting and auditing.
We are a
reporting company and file annual, quarterly and current reports, proxy
statements and other information with the Securities and Exchange Commission. In
addition, we have filed with the SEC a Registration Statement on Form S-3, of
which this prospectus supplement is a part, under the Securities Act with
respect to the securities offered hereby. This prospectus supplement does not
contain all of the information set forth in the registration statement or the
exhibits which are a part of the registration statement. You may read and copy
the registration statement and any document we file with the SEC at the public
reference room maintained by the SEC at 100 F Street, N.E., Washington, D.C.
20549. You may obtain information on the operation of the public reference room
by calling the SEC at 1-800-SEC-0330. Our filings with the SEC are also
available to the public through the SEC’s Internet site at http://www.sec.gov.
We are
“incorporating by reference” information into this prospectus supplement. This
means that we are disclosing important information to you by referring you to
another document that has been filed separately with the SEC. The information
incorporated by reference is considered to be part of this prospectus
supplement, and information that we file later with the SEC will automatically
update and supersede the information contained in documents filed earlier with
the SEC or contained in this prospectus supplement. We incorporate by reference
in this prospectus supplement the documents listed below and any future filings
made by us with the SEC under Section 13(a), 13(c), 14 and 15(d) of the
Securities Exchange Act of 1934 after the initial filing of this prospectus
supplement and prior to the time that we sell all of the securities offered by
this prospectus supplement and the accompanying prospectus (except in each case
the information contained in such documents to the extent “furnished” and not
“filed”):
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Annual Report on Form 10-K for the fiscal year ended March 31,
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Our
Quarterly Report on Form 10-Q for the quarter ended June 30,
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Current Report on Form 8-K filed on October 8, 2009
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Our
Current Report on Form 8-K filed on October 13, 2009
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The
description of our common stock contained in our Registration Statement on
Form 8-A filed pursuant to Section 12 of the Exchange Act on March 7,
2006.
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All
other reports filed pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 since the end of the fiscal year covered by the above
referred to annual report.
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All
documents that we file after the date of this prospectus supplement pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 shall
be deemed incorporated by reference into this prospectus supplement. The reports
and other documents that we file after the date of this prospectus supplement
will update, supplement and supersede the information in this prospectus
supplement.
Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this prospectus.
Copies
of the above documents (other than exhibits to such documents unless those
exhibits have been specifically incorporated by reference in this prospectus
supplement) may be obtained upon request without charge upon writing to India
Globalization Capital, Inc., Attn: Corporate Secretary, 4336 Montgomery Ave,
Bethesda, Maryland 20814.
PROSPECTUS
—DATED September 16, 2009
$6,000,000
India
Globalization Capital, Inc.
Common
Stock
Preferred
Stock
Warrants
Units
From
time to time, we may offer up to $6,000,000 of any combination of the securities
described in this prospectus, either individually or in units. We may also offer
common stock upon conversion of preferred stock, or common stock or preferred
stock upon the exercise of warrants. Such securities may be offered and sold by
us in one or more offerings with a total aggregate principal amount or initial
purchase price not to exceed $6,000,000.
This
prospectus provides a general description of these securities. We will provide
specific information and the terms of the securities being offered in
supplements to this prospectus. The supplements may also add, update or change
information in this prospectus. Please read this prospectus and any prospectus
supplements together with any documents incorporated by reference carefully
before investing. This prospectus may not be used to sell securities unless
accompanied by a prospectus supplement.
Our
common stock is traded on the NYSE Amex under the symbol “IGC.” On September 9,
2009, the last reported sale price for our common stock on the NYSE Amex was
$1.27 per share.
Our
principal executive offices are located at 4336 Montgomery Ave, Bethesda,
Maryland 20814, and our telephone number is (301) 983-0998.
We
may offer these securities directly to investors, through underwriters, dealers
or agents, on a continuous or delayed basis. See “Plan of Distribution.” Each
prospectus supplement will provide the terms of the plan of distribution
relating to each series of securities.
Investing in our securities involves
risks that you should consider and that are described in our most recent Annual
Report on Form 10-K, and any subsequent Quarterly Report on Form 10-Q, which are
incorporated by reference into this prospectus or any applicable prospectus
supplement.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the adequacy or
accuracy of this prospectus. Any representation to the contrary is a criminal
offense.
The
date of this prospectus is September 16, 2009.
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the Securities
and Exchange Commission (the “SEC”) using a “shelf” registration, or continuous
offering, process. Under this shelf registration process, we may, from time to
time, offer shares of our common stock, preferred stock, or warrants to purchase
any of such securities, either individually or in units, in one or more
offerings, up to a total initial issuance amount of $6,000,000.
This
prospectus provides you with a general description of the securities we may
offer. The specific terms of any securities to be offered will be described in a
prospectus supplement. Any prospectus supplement and any related free writing
prospectus that we may authorize to be provided to you may also add, update or
change information contained in this prospectus. Any statement that we make in
this prospectus will be modified or superseded by any inconsistent statement
made by us in a prospectus supplement. The registration statement we filed with
the SEC includes exhibits that provide more detail on descriptions of the
matters discussed in this prospectus. You should read this prospectus and the
related exhibits filed with the SEC and any prospectus supplement, together with
additional information described under the heading “Where You Can Find More
Information.”
Unless
the context otherwise requires, references in this prospectus and the
accompanying prospectus supplement to “we,” “us” and “our” refer to India
Globalization Capital, Inc. and its subsidiaries.
TABLE
OF CONTENTS
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You
should rely only on the information incorporated by reference or provided in
this prospectus, any prospectus supplement, the registration statement and any
other free writing prospectus authorized by us to be provided to you. We have
not authorized anyone else to provide you with different information. If anyone
provides you with different or inconsistent information, you should not rely on
it. We are not making an offer to sell these securities in any state where the
offer or sale is not permitted. You should assume that the information in this
prospectus and any prospectus supplement, or incorporated by reference, is
accurate only as of the dates of those documents. Our business, financial
condition, results of operations and prospects may have changed since those
dates.
Background of India Globalization
Capital, Inc.
(IGC)
IGC, a
Maryland corporation, was organized on April 29, 2005 as a blank check
company formed for the purpose of acquiring one or more businesses with
operations primarily in India through a merger, capital stock exchange, asset
acquisition or other similar business combination or acquisition. On March 8,
2006, we completed an initial public offering. On February 19, 2007,
we incorporated India Globalization Capital, Mauritius, Limited (IGC-M), a
wholly owned subsidiary, under the laws of Mauritius. On March 7,
2008, we consummated the acquisition of 63% of the equity of Sricon
Infrastructure Private Limited (Sricon) and 77% of the equity of Techni Bharathi
Limited (TBL). The shares of the two Indian companies, Sricon and TBL, are held
by IGC-M. On February 19, 2009 IGC-M beneficially purchased 100% of
IGC Mining and Trading, Limited (IGC-IMT based in Chennai,
India). IGC-IMT was formed on December 16, 2008 as a privately held
start-up company engaged in the business of mining and trading. Its
current activity is to operate a shipping hub and export iron ore to
China. On July 4, 2009, IGC-M beneficially purchased 100% of IGC
Materials, Private Limited (IGC-MPL based in Nagpur, India), which will conduct
IGC’s quarrying business, and 100% of IGC Logistics, Private Limited (IGC-LPL
based in Nagpur, India), which will be involved in the transport and delivery of
ore, cement, aggregate and other material. Each of IGC-IMT,
IGC-MPL and IGC-LPL were formed by third parties at the behest of IGC-M to
facilitate the creation of the subsidiaries, and the purchase price paid for
each of IGC-IMT. IGC-MPL and IGC-LPL was equal to the expenses incurred in
incorporating the respective entities with no premium paid. No
officer or director of IGC had a financial interest in the subsidiaries at the
time of their acquisition by IGC-M. India Globalization
Capital, Inc. (the Registrant, the Company, or we) and its subsidiaries are
significantly engaged in one segment, infrastructure construction.
IGC’s
organizational structure is as follows:
Most of
the shares of Sricon and TBL acquired by IGC were purchased directly from the
companies. IGC purchased a portion of the shares from the existing owners of the
companies. The founders and management of Sricon own 37% of Sricon
and the founders and management of TBL own 23% of TBL.
The
acquisitions were accounted for under the purchase method of
accounting. Under this method of accounting, for accounting and
financial purposes, IGC-M, Limited was treated as the acquiring entity and
Sricon and TBL as the acquired entities. The financial statements
provided here and going forward are the consolidated statements of IGC, which
include IGC-M, Sricon, TBL and their subsidiaries. However,
historical description of our business for periods and dates prior to March 7,
2008 include information on Sricon and TBL.
Unless
the context requires otherwise, all references in this report to the “Company”,
“IGC”, “we”, “our”, and “us” refer to India Globalization Capital, Inc, together
with its wholly owned subsidiary IGC-M, and its direct and indirect subsidiaries
(Sricon, TBL, IGC-IMT, IGC-MPL and IGC-LPL).
Overview
Sricon
Infrastructure Private Limited (“Sricon”) was incorporated as a private limited
company on March 3, 1997 in Nagpur, India. Sricon is an engineering
and construction company that is engaged in three business areas: 1) civil
construction of highways and other heavy construction, 2) mining and quarrying
and 3) the construction and maintenance of high temperature cement and steel
plants. Sricon’s present and past clients include various Indian
government organizations. It has the prior experience to bid on
contracts that are priced at a maximum of about $116
million. As indicated in previous press releases and quarterly
reports, in October 2008 lack of available credit drove Sricon to curtail much
of its construction activity, as it was unable to provide Bank Guarantees for
construction contracts, and to focus on long term recurring contracts such as
maintenance of high temperature cement factories. This led to a sharp
decline in overall revenue. Sricon took several steps to curtail its
expenses including lay offs. Sricon also turned its attention to
pursuing claims against the contracting agencies for delays it had suffered on
some of its contracts. Due to arbitration requirements in our
contract agreements, we expect our claims to be resolved in arbitration. Sricon
claims losses from having to maintain equipment and personnel during the delay
period, as well as opportunity costs. There can be no assurance that
Sricon will be successful in its claims. While the cost associated
with delays is accounted in the relevant period, any revenue from claims is not
accounted until and unless they are paid.
Techni
Bharathi Limited (“TBL”) was incorporated as a public (but not listed on the
stock market) limited company on June 19, 1982 in Cochin, India. TBL
is an engineering and construction company engaged in the execution of civil
construction and structural engineering projects. TBL has a focus in
the Indian states of Andhra Pradesh, Karnataka, Assam and Tamil Nadu. Its
present and past clients include various Indian government
organizations. The overall lack of liquidity led TBL to curtail its
construction contracts and cut its costs through layoffs. TBL is
re-focused on smaller construction contracts and the settlement of
claims.
IGC-Mauritius
(IGC-M), through its wholly owned subsidiaries (IGC India Mining and Trading
(IGC-IMT), IGC Materials, Private Limited (IGC-MPL)
and IGC Logistics, Private Limited (IGC-LPL) in India, is also
involved in the building of rock quarries, the export of iron ore and the
transport of materials. IGC-M operates a shipping hub in the
Krishnapatnam port on the west coast of India. We aggregate ore
from smaller mines before shipping to China. We are also engaged in
the production of rock aggregate and the development of rock
quarries. Rock aggregate is used in the construction of roads,
railways, dams, and other infrastructure development. We are in the
process of developing several quarries through partnerships with landowners.
Iron ore is rock and minerals from which metallic iron can be
extracted. The primary form used in industry today is hematite and is
often the principle raw material used to make “pig iron” , a material critical
to the production of industrial steel.
Core
Business Areas
Our core
business areas include the following:
Highway and heavy
construction:
The
Indian government has articulated a plan to build and modernize Indian
infrastructure. The government’s plan, calls for spending over $475
billion over the next five years for the expansion and construction of rural
roads, major highways, airports, seaports, freight corridors, railroads and
townships. We build roads, highways, bridges and other heavy
construction build outs.
Mining
and Quarrying
As Indian
infrastructure modernizes, the demand for raw materials like stone aggregate,
coal, ore and similar resources is projected to increase. In 2006, according to
the Freedonia Group, India was the fourth largest stone aggregate market in the
world with demand of up to 1.1 billion metric tons. Our primary goal
is to build as many as ten rock quarries, operate them and sell rock aggregate
to the infrastructure industry. We are teaming with landowners to
build and operate rock quarries. In addition we have licenses for the
operation of rock aggregate quarries. Our mining and trading
activity centers on the export of Iron ore to China. India is
the fourth largest producer of ore, exporting about 100 million tons of iron ore
annually to Chinese interests around the world.
Construction
and maintenance of high temperature plants
We have
an expertise in the civil engineering, construction and maintenance of high
temperature plants. This requires specialized skills to build and maintain
high temperature chimneys and kilns.
Customers
We are
qualified in all states in India and we have worked in several, including
Maharashtra, Gujarat, Orissa and Madhya Pradesh. The National Highway
Authority of India (NHAI) awards interstate highway contracts on a national
level, while intra-state contracts are awarded by state agencies. The National
Thermal Power Corporation (NTPC) awards contacts for civil work associated
with power plants. The National Coal Limited (NCL) awards large mining
contracts. Our customers include, or have included, NHAI, NTPC, and various
state public works departments. Sricon is registered across India and is
qualified to bid on contracts anywhere in India. For the export of
iron ore from India, we are developing steel factories in China as
customers.
Contract
bidding process
In order
to create transparency, the Indian government has centralized the contract
awarding process for building inter-state
roads. The new process is as follows: At the “federal” level, as an
example, NHAI publishes a Statement of Work for an interstate highway
construction project. The Statement of Work has a detailed
description of the work to be performed as well as the completion time frame.
The bidder prepares two proposals in response to the Statement of Work. The
first proposal demonstrates technical capabilities, prior work experience,
specialized machinery, and manpower required, and other criteria required to
complete the project. The second proposal includes a financial
bid. NHAI evaluates the technical bids and short lists technically
qualified companies. Next, the short list of technically qualified companies
are invited to place a detailed financial bid and show adequate
financial strength in terms of revenue, net worth, credit lines,
and balance sheets. Typically, the lowest bid wins the contract. Also,
contract bidders must demonstrate an adequate level of capital reserves such as
the following: 1) An earnest money deposit between 2% to 10%
of project costs, 2) performance guarantee of between 5% and 10%, 3)
adequate working capital and 4) additional capital for plant and
machinery. Bidding qualifications for larger NHAI projects
are set by NHAI which are imposed on each contractor. As the
contractor executes larger highway projects, the ceiling is increased by
NHAI.
Our
Growth Strategy and Business Model
Our
business model for the construction business is simple. We bid on
construction, over burden removal at mining sites and or maintenance
contracts. Successful bids increase our backlog of orders,
which favorably impacts our revenues and margins. The
contracting process typically takes approximately four months. Over the
years, we have been successful in winning one out of every seven bids on
average. We currently have one bid team. In the
next year we will focus on the following: 1) build out between two and five rock
quarries, begin production and obtain long term contracts for the sale of rock
aggregate, 2) leverage our shipping hub, develop a second shipping hub, develop
customers for the delivery and sale of iron ore, 3) execute and expand recurring
contracts for infrastructure build out, 4) aggressively pursue the collection of
accounts receivables and delay claims.
Competition
We
operate in an industry that is fairly competitive. However, there is
a large gap in the supply of well qualified and financed contractors and the
demand for contractors. Large domestic and international firms compete for
jumbo contracts over $250 million in size, while locally based contractors vie
for contracts less than $5 million. The recent capital markets crisis has made
it more difficult for smaller companies to maturate into mid-sized companies, as
their access to capital has been restrained. Therefore, we would like to be
positioned in the $5 million to $50 million contract range, above locally based
contractors and below the large firms, creating a distinct technical and
financial advantage in this market niche. Rock aggregate is supplied
to the industry through small crushing units, which supply low quality
material. Frequently, high quality rock aggregate is unavailable, or
is transported over large distances. We fill this gap by providing
high quality material in large quantities. We compete on price,
quantity and quality. Iron ore is produced in India and exported to
China. While this is a fairly established industry, we compete by
aggregating ore from smaller suppliers who do not have access to customers in
China. Further, at our second shipping hub we expect to install a crusher that
can grind ore pebbles into dust, again providing a value added service to the
smaller mine owners.
Market
Size
The
Indian government estimates that it will require $475 billion over the next four
to five years to address India’s infrastructure needs. According to
Freedonia Group, in 2006, India was the fourth largest stone aggregate market in
the world with demand of up to 1.1 billion metric tons. With the
infrastructure industry expected to grow rapidly, the demand for aggregate is
expected to increase over the next five years. According to the New
York Times iron ore ranks among the most important commodities in the world, the
main ingredient in steel that goes into construction, bridges and
ships. China imports about half the world’s supply of
ore. In 2008 the market totaled between $75 billion and $80
billion.
Seasonality
The
construction industry (road building) typically experiences recurring and
natural seasonal patterns throughout India. The North East Monsoons,
historically, arrive on June 1, followed by the South West Monsoons, which
usually lasts intermittently until September. Historically, the
monsoon months are slower than the other months because of the
rains. Activity such as engineering, maintenance of high temperature
plants, and export of iron ore are less susceptible to the rains. The
reduced paced in construction activity has historically been used to bid and win
contracts. The contract bidding activity is typically very high during the
monsoon season in preparation for work activity when the rains
abate. During the monsoon season the rock quarries operate to build
up and distribute reserves to the various construction sites.
Employees
and Consultants
As of
March 31, 2009, we employed a work force of approximately 400 employees and
contract workers worldwide. Employees are typically skilled workers
including executives, welders, drivers, and other specialized experts. Contract
workers require less specialized skills. We make diligent efforts to comply with
all employment and labor regulations, including immigration laws in the many
jurisdictions in which we operate. In order to attract and retain
skilled employees, we have implemented a performance based incentive program,
offered career development programs, improved working conditions, and
provided United States work assignments, technology training, and other fringe
benefits. We are hoping that our efforts will make our companies more
attractive. While we have not done so yet, we are exploring adopting
best practices for creating and providing vastly improved labor camps for our
labor force. We are hoping that our efforts will make our companies
“employers of choice” and best of breed. As of March 31, 2009 our
Executive Chairman and Chief Executive Officer is Ram Mukunda and our Chairman
is Ranga Krishna. Our Managing Director for Construction is Ravindra
Lal Srivastava, our Managing Director for Materials, Mining and Trading is P. M.
Shivaraman. Our Treasurer and Principal Accounting officer is
John Selvaraj. Our General Manager of Accounting based in India is
Santhosh Kumar. We also utilize the services of several consultants
who provide USGAAP systems expertise and SOX expertise, among
others.
Environmental
Regulations
India has
very strict environmental, occupational, health and safety
regulations. In most instances, the contracting agency regulates and
enforces all regulatory requirements. We internally monitor and
manage regulatory issues on a continuous basis, and we believe that we are in
compliance in all material respects with the regulatory requirements of the
jurisdictions in which we operate. Furthermore, we do not believe that
compliance will have a material adverse effect on our business
activities.
Information
and timely reporting
Our
operations are located in India where the accepted accounting standards is
Indian GAAP, which in many cases, is not congruent to
USGAAP. Indian accounting standards are evolving towards adopting
IFRS (International Financial Reporting Standards). We
annually conduct PCAOB (USGAAP) audits for the company. We
acknowledge that the process of quarterly reporting and annual audits are at
times cumbersome and places significant constraints on our existing
staff. We believe we are still 12 to 18 months away from having
processes in place to meet the reporting timetables set out by the U.S.
reporting requirements. Until then we expect to file, from time to
time, automatic extensions to meet the reporting timetables. We will
make available on our website, www.indiaglobalcap.com,
our annual reports, quarterly reports, proxy statements as well as up to- date
investor presentations. Our SEC filings are also available at
www.sec.gov.
We
may offer shares of our common stock, preferred stock, or warrants to purchase
any of such securities, either individually or in units, with a total value of
up to $6,000,000 from time to time under this prospectus at prices and on terms
to be determined by market conditions at the time of any offering. This
prospectus provides you with a general description of the securities we may
offer. Each time we offer a type or series of securities under this prospectus,
we will provide a prospectus supplement that will describe the specific amounts,
prices and other important terms of the securities, including, to the extent
applicable:
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or classification;
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Aggregate
principal amount or aggregate offering price;
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Maturity,
if applicable;
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Rates
and times of payment of interest or dividends, if any;
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Redemption,
conversion, exercise or exchange, if any;
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Ranking;
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Restrictive
covenants, if any;
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or other rights, if any;
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prices, if any; and
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Material
U.S. federal income tax
considerations.
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The
prospectus supplement and any related free writing prospectus that we may
authorize to be provided to you may also add, update or change information
contained in this prospectus or in documents we have incorporated by reference.
However, no prospectus supplement or free writing prospectus will offer a
security that is not registered and described in this prospectus at the time of
the effectiveness of the registration statement of which this prospectus is a
part.
An
investment in our securities involves a high degree of risk. Prior to making a
decision about investing in our securities, you should carefully consider the
specific risk factors discussed in the sections entitled “Risk Factors”
contained in any applicable prospectus supplement and our filings with the SEC
and incorporated by reference in this prospectus, together with all of the other
information contained in this prospectus, or any applicable prospectus
supplement. If any of the risks or uncertainties described in our SEC filings or
any prospectus supplement or any additional risks and uncertainties actually
occur, our business, financial condition and results of operations could be
materially and adversely affected. In that case, the trading price of our
securities could decline and you might lose all or part of the value of your
investment.
The
following documents filed with the SEC by India Globalization Capital, Inc. (the
“Company”) pursuant to the Securities Act of 1933, as amended (the “Securities
Act:”) and the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
are hereby incorporated by reference in this registration
statement:
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Our
Annual Report on Form 10-K for the fiscal year ended March 31,
2009
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Our
Quarterly Report on Form 10-Q for the quarter ended June 30,
2009
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The
description of our common stock contained in our Registration Statement on
Form 8-A filed pursuant to Section 12 of the Exchange Act on March 7,
2006.
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All
documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this registration statement and
prior to the filing of a post-effective amendment to the registration statement
of which this prospectus forms a part indicating that all securities offered
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference into this prospectus and to be a part
hereof from the date of filing of such documents.
Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this prospectus.
Copies
of the above documents (other than exhibits to such documents) may be obtained
upon request without charge upon writing to India Globalization Capital, Inc.,
Attn: Corporate Secretary, 4336 Montgomery Ave, Bethesda, Maryland
20814.
We
are a reporting company and file annual, quarterly and current reports, proxy
statements and other information with the Securities and Exchange Commission, or
SEC. In addition, we have filed with the SEC a Registration Statement on Form
S-3, of which this prospectus is a part, under the Securities Act with respect
to the securities offered hereby. This prospectus does not contain all of the
information set forth in the registration statement or the exhibits which are a
part of the registration statement. You may read and copy the registration
statement and any document we file with the SEC at the public reference room
maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You may
obtain information on the operation of the public reference room by calling the
SEC at 1-800-SEC-0330. Our filings with the SEC are also available to the public
through the SEC’s Internet site at http://www.sec.gov.
Some of
the statements in this prospectus, the documents incorporated by reference into
this prospectus and in any prospectus supplement may be deemed “forward-looking
statements” within the meaning of Section 21E of the Exchange Act, and
Section 27A of the Securities Act. All statements, other than statements of
historical fact, that address activities, events or developments that we intend,
expect, project, believe or anticipate will or may occur in the future are
forward-looking statements. Such statements are based upon certain assumptions
and assessments made by us in light of our experience and our perception of
historical trends, current conditions and expected future developments. Actual
results and the timing of events may differ significantly from those projected
in such forward-looking statements due to a number of factors, including those
set forth in the sections entitled “Risk Factors” in our most recent Annual
Report on Form 10-K and any subsequent Quarterly Report on Form 10-Q, which are
incorporated by reference into this prospectus.
Unless
otherwise specified in the applicable prospectus supplement, we intend to use
the net proceeds from the sale of the securities in the prospectus and any
prospectus supplement for general corporate purposes, which could
include:
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Repayment
of indebtedness;
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Working
capital;
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Capital
expenditures; and
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Acquisitions.
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We will
describe the specific use of proceeds from the sale of the securities in the
prospectus supplement.
We
will set forth in a prospectus supplement the following information regarding
any material dilution of the equity interests of investors purchasing securities
in an offering under this prospectus:
• the
net tangible book value per share of our equity securities before and after the
offering;
• the
amount of the increase in such net tangible book value per share attributable to
the cash payments made by purchasers in the offering; and
• the
amount of the immediate dilution from the public offering price which will be
absorbed by such purchasers.
This
section describes the general terms and provisions of the shares of our common
stock, par value $0.001 per share, and preferred stock, par value $0.001 per
share. The summary is not complete and is qualified in its entirety by reference
to the description of our common stock incorporated by reference in this
prospectus. We have also filed our amended and restated articles of
incorporation and our bylaws as exhibits to the registration statement, of which
this prospectus is a part. You should read our amended and restated articles of
incorporation and our bylaws for additional information before you buy any of
our capital stock. See “Where You Can Find More Information.”
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
June 30, 2009 there were 10,091,971 shares of common stock outstanding
and no shares of preferred stock 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 can be traded separately.
Common
Stock
Our
stockholders are entitled to one vote for each share held of record on all
matters to be voted on by 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. 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.
Our
stockholders have no conversion, preemptive or other subscription rights and
there are no sinking fund or redemption provisions applicable to the common
stock.
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. 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.
Maryland
Anti-Takeover Provisions and Certain Anti-Takeover Effects of our Charter and
Bylaws
Business
Combinations
Under the
Maryland General Corporation Law, some business combinations, including a
merger, consolidation, share exchange or, in some circumstances, an asset
transfer or issuance or reclassification of equity securities, are prohibited
for a period of time and require an extraordinary vote. These transactions
include those between a Maryland corporation and the following persons (a
“Specified Person”):
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an
interested stockholder, which is defined as any person (other than a
subsidiary) who beneficially owns 10% or more of the corporation’s voting
stock, or who is an affiliate or an associate of the corporation who, at
any time within a two-year period prior to the transaction, was the
beneficial owner of 10% or more of the voting power of the corporation’s
voting stock or
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an
affiliate of an interested
stockholder.
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A person
is not an interested stockholder if the board of directors approved in advance
the transaction by which the person otherwise would have become an interested
stockholder. The board of directors of a Maryland corporation also may exempt a
person from these business combination restrictions prior to the time the person
becomes a Specified Person and may provide that its exemption is subject to
compliance with any terms and conditions determined by the board of directors.
Transactions between a corporation and a Specified Person are prohibited for
five years after the most recent date on which such stockholder becomes a
Specified Person. After five years, any business combination must be recommended
by the board of directors of the corporation and approved by at least 80% of the
votes entitled to be cast by holders of voting stock of the corporation and
two-thirds of the votes entitled to be cast by holders of shares other than
voting stock held by the Specified Person with whom the business combination is
to be effected, unless the corporation’s stockholders receive a minimum price as
defined by Maryland law and other conditions under Maryland law are
satisfied.
A
Maryland corporation may elect not to be governed by these provisions by having
its board of directors exempt various Specified Persons, by including a
provision in its charter expressly electing not to be governed by the applicable
provision of Maryland law or by amending its existing charter with the approval
of at least 80% of the votes entitled to be cast by holders of outstanding
shares of voting stock of the corporation and two-thirds of the votes entitled
to be cast by holders of shares other than those held by any Specified Person.
Our Charter does not include any provision opting out of these business
combination provisions.
Control
Share Acquisitions
The
Maryland General Corporation Law also prevents, subject to exceptions, an
acquiror who acquires sufficient shares to exercise specified percentages of
voting power of a corporation from having any voting rights except to the extent
approved by two-thirds of the votes entitled to be cast on the matter not
including shares of stock owned by the acquiring person, any directors who are
employees of the corporation and any officers of the corporation. These
provisions are referred to as the control share acquisition
statute.
The
control share acquisition statute does not apply to shares acquired in a merger,
consolidation or share exchange if the corporation is a party to the
transaction, or to acquisitions approved or exempted prior to the acquisition by
a provision contained in the corporation’s charter or bylaws. Our Bylaws include
a provision exempting IGC from the restrictions of the control share acquisition
statute, but this provision could be amended or rescinded either before or after
a person acquired control shares. As a result, the control share acquisition
statute could discourage offers to acquire IGC stock and could increase the
difficulty of completing an offer.
Board
of Directors
The
Maryland General Corporation Law provides that a Maryland corporation which is
subject to the Exchange Act and has at least three outside directors (who are
not affiliated with an acquirer of the company) under certain circumstances may
elect by resolution of the board of directors or by amendment of its charter or
bylaws to be subject to statutory corporate governance provisions that may be
inconsistent with the corporation’s charter and bylaws. Under these provisions,
a board of directors may divide itself into three separate classes without the
vote of stockholders such that only one-third of the directors are elected each
year. A board of directors classified in this manner cannot be altered by
amendment to the charter of the corporation. Further, the board of directors
may, by electing to be covered by the applicable statutory provisions and
notwithstanding the corporation’s charter or bylaws:
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provide
that a special meeting of stockholders will be called only at the request
of stockholders entitled to cast at least a majority of the votes entitled
to be cast at the meeting,
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reserve
for itself the right to fix the number of
directors,
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provide
that a director may be removed only by the vote of at least two-thirds of
the votes entitled to be cast generally in the election of directors
and
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retain
for itself sole authority to fill vacancies created by an increase in the
size of the board or the death, removal or resignation of a
director.
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In
addition, a director elected to fill a vacancy under these provisions serves for
the balance of the unexpired term instead of until the next annual meeting of
stockholders. A board of directors may implement all or any of these provisions
without amending the charter or bylaws and without stockholder approval.
Although a corporation may be prohibited by its charter or by resolution of its
board of directors from electing any of the provisions of the statute, we have
not adopted such a prohibition. We have adopted a staggered board of directors
with 3 separate classes in our charter and given the board the right to fix the
number of directors, but we have not prohibited the amendment of these
provisions. The adoption of the staggered board may discourage offers
to acquire IGC stock and may increase the difficulty of completing an offer to
acquire our stock. If our board chose to implement the statutory provisions, it
could further discourage offers to acquire IGC stock and could further increase
the difficulty of completing an offer to acquire our stock.
Effect
of Certain Provisions of our Charter and Bylaws
In
addition to the Charter and Bylaws provisions discussed above, certain other
provisions of our Bylaws may have the effect of impeding the acquisition of
control of IGC by means of a tender offer, proxy fight, open market purchases or
otherwise in a transaction not approved by our board of directors. These
provisions of Bylaws are intended to reduce our vulnerability to an unsolicited
proposal for the restructuring or sale of all or substantially all of our assets
or an unsolicited takeover attempt which our board believes is otherwise unfair
to our stockholders. These provisions, however, also could have the effect of
delaying, deterring or preventing a change in control of IGC.
Stockholder Meetings; Advance Notice
of Director Nominations and New Business . Our Bylaws provide that with
respect to annual meetings of stockholders, (i) nominations of individuals for
election to our board of directors and (ii) the proposal of business to be
considered by stockholders may be made only:
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pursuant
to IGC’s notice of the meeting,
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by
or at the direction of our board of directors
or
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by
a stockholder who is entitled to vote at the meeting and has complied with
the advance notice procedures set forth in our
Bylaws.
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Special
meetings of stockholders may be called only by the chief executive officer, the
board of directors or the secretary of IGC (upon the written request of the
holders of a majority of the shares entitled to vote). At a special meeting of
stockholders, the only business that may be conducted is the business specified
in IGC’s notice of meeting. With respect to nominations of persons for election
to our board of directors, nominations may be made at a special meeting of
stockholders only:
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pursuant
to IGC’s notice of meeting,
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by
or at the direction of our board of directors
or
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if
our board of directors has determined that directors will be elected at
the special meeting, by a stockholder who is entitled to vote at the
meeting and has complied with the advance notice procedures set forth in
our Bylaws.
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These
procedures may limit the ability of stockholders to bring business before a
stockholders meeting, including the nomination of directors and the
consideration of any transaction that could result in a change in control and
that may result in a premium to our stockholders.
Our
Transfer Agent and Warrant Agent
The transfer agent for our securities and warrant agent
for our warrants is Continental Stock Transfer & Trust
Company.
We may issue warrants for the purchase of common stock or, preferred stock in
one or more series. We may issue warrants independently or together with common
stock and/or preferred stock, and the warrants may be attached to or separate
from these securities. While the terms summarized below will apply generally to
any warrants that we may offer, we will describe the particular terms of any
series of warrants in more detail in the applicable prospectus supplement. The
terms of any warrants offered under a prospectus supplement may differ from the
terms described below.
We will file as exhibits to the registration statement of which this
prospectus is a part, or will incorporate by reference from reports that we file
with the SEC, the form of warrant agreement, including a form of warrant
certificate, that describes the terms of the particular series of warrants we
are offering before the issuance of the related series of warrants. The
following summaries of material provisions of the warrants and the warrant
agreements are subject to, and qualified in their entirety by reference to, all
the provisions of the warrant agreement and warrant certificate applicable to
the particular series of warrants that we may offer under this prospectus. We
urge you to read the applicable prospectus supplements related to the particular
series of warrants that we may offer under this prospectus and the complete
warrant agreements and warrant certificates that contain the terms of the
warrants.
We
will describe in the applicable prospectus supplement the terms of the series of
warrants being offered, including:
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The
offering price and aggregate number of warrants
offered;
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The
currency for which the warrants may be purchased;
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If
applicable, the designation and terms of the securities with which the
warrants are issued and the number of warrants issued with each such
security or each principal amount of such security;
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If
applicable, the date on and after which the warrants and the related
securities will be separately transferable;
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In
the case of warrants to purchase common stock or preferred stock, the
number of shares of common stock or preferred stock, as the case may be,
purchasable upon the exercise of one warrant and the price at which these
shares may be purchased upon such exercise;
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The
effect of any merger, consolidation, sale or other disposition of our
business on the warrant agreements and the warrants;
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The
terms of our rights to redeem or sell the warrants;
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Any
provisions for changes to or adjustments in the exercise price or number
of securities issuable upon exercise of the warrants;
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The
dates on which the right to exercise the warrants will commence and
expire;
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The
manner in which the warrant agreements and warrants may be
modified;
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A
discussion of any material U.S. federal income tax consequences of holding
or exercising the warrants;
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The
terms of the securities issuable upon exercise of the warrants;
and
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Any
other specific terms, preferences, rights or limitations of or
restrictions on the warrants.
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Each warrant will entitle the holder to purchase the securities that we
specify in the applicable prospectus supplement at the exercise price that we
describe in the applicable prospectus supplement. Holders of the warrants may
exercise the warrants at any time up to the specified time on the expiration
date that we set forth in the applicable prospectus supplement. After such time
on the expiration date, unexercised warrants will become void.
Holders of the warrants may exercise the warrants by delivering the
warrant certificate representing the warrants to be exercised together with
specified information, and paying the required amount to the warrant agent in
immediately available funds, as provided in the applicable prospectus
supplement. We will set forth on the reverse side of the warrant certificate and
in the applicable prospectus supplement the information that the holder of the
warrant will be required to deliver to the warrant agent.
Upon receipt of the required payment and the warrant certificate properly
completed and duly executed at the corporate trust office of the warrant agent
or any other office indicated in the applicable prospectus supplement, we will
issue and deliver the securities purchasable upon such exercise. If fewer than
all of the warrants represented by the warrant certificate are exercised, then
we will issue a new warrant certificate for the remaining amount of warrants. If
we so indicate in the applicable prospectus supplement, holders of the warrants
may surrender securities as all or part of the exercise price for
warrants.
Unless we provide otherwise in the applicable
prospectus supplement, the warrants and warrant agreements will be governed by
and construed in accordance with the laws of the State of Maryland.
We may issue, in one more series, units consisting of common stock,
preferred stock, and/or warrants or contracts for the purchase of common
stock and/or preferred stock in any combination in such amounts and
in such numerous distinct series as we determine. While the terms we have
summarized below will apply generally to any units that we may offer under this
prospectus, we will describe the particular terms of any series of units in more
detail in the applicable prospectus supplement. The terms of any units offered
under a prospectus supplement may differ from the terms described
below.
We will file as exhibits to the registration statement of which this
prospectus is a part, or will incorporate by reference from reports that we file
with the SEC, the form of unit agreement that describes the terms of the series
of units we are offering, and any supplemental agreements, before the issuance
of the related series of units. The following summaries of material terms and
provisions of the units are subject to, and qualified in their entirety by
reference to, all the provisions of the unit agreement and any supplemental
agreements applicable to a particular series of units. We urge you to read the
applicable prospectus supplements related to the particular series of units that
we may offer under this prospectus, as well as any related free writing
prospectuses and the complete unit agreement and any supplemental agreements
that contain the terms of the units.
Each unit will be issued so that the holder of the unit is also the
holder of each security included in the unit. Thus, the holder of a unit will
have the rights and obligations of a holder of each included security. The unit
agreement under which a unit is issued may provide that the securities included
in the unit may not be held or transferred separately, at any time or at any
time before a specified date.
We
will describe in the applicable prospectus supplement the terms of the series of
units being offered, including:
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The
designation and terms of the units and of the securities comprising the
units, including whether and under what circumstances those securities may
be held or transferred separately;
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Any
provisions of the governing unit agreement that differ from those
described below; and
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Any
provisions for the issuance, payment, settlement, transfer or exchange of
the units or of the securities comprising the
units.
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The
provisions described in this section, as well as those described under
“Description of Capital Stock,” and “Description of Warrants” will apply to each
unit and to any common stock, preferred stock or warrant included in each unit,
respectively.
Each
unit agent will act solely as our agent under the applicable unit agreement and
will not assume any obligation or relationship of agency or trust with any
holder of any unit. A single bank or trust company may act as unit agent for
more than one series of units. A unit agent will have no duty or responsibility
in case of any default by us under the applicable unit agreement or unit,
including any duty or responsibility to initiate any proceedings at law or
otherwise, or to make any demand upon us. Any holder of a unit may, without the
consent of the related unit agent or the holder of any other unit, enforce by
appropriate legal action its rights as holder under any security included in the
unit.
We,
and any unit agent and any of their agents, may treat the registered holder of
any unit certificate as an absolute owner of the units evidenced by that
certificate for any purpose and as the person entitled to exercise the rights
attaching to the units so requested, despite any notice to the
contrary.
We
may sell the securities offered by this prospectus in any one or more of the
following ways from time to time:
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Directly
to investors, including through a specific bidding, auction or other
process;
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To
investors through agents;
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Directly
to agents;
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To
or through brokers or dealers;
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To
the public through underwriting syndicates led by one or more managing
underwriters;
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To
one or more underwriters acting alone for resale to investors or to the
public; or
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Through
a combination of any such methods of
sale.
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We may also in sell the securities offered by this prospectus in “at
the market offerings” within the meaning of Rule 415(a)(4) of the
Securities Act, to or through a market maker or into an existing trading market,
on an exchange or otherwise.
The accompanying prospectus supplement will set forth the terms of the
offering and the method of distribution and will identify any firms acting as
underwriters, dealers or agents in connection with the offering,
including:
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The
name or names of any underwriters, dealers or agents;
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The
purchase price of the securities and the proceeds to us from the
sale;
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Any
over-allotment options under which the underwriters may purchase
additional securities from us;
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Any
underwriting discounts and other items constituting compensation to
underwriters, dealers or agents;
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Any
public offering price;
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Any
discounts or concessions allowed or reallowed or paid to dealers;
or
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Any
securities exchange or market on which the securities offered in the
prospectus supplement may be
listed.
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Only those underwriters identified in such prospectus
supplement are deemed to be underwriters in connection with the securities
offered in the prospectus supplement. Any underwritten offering may be on a best
efforts or a firm commitment basis.
The distribution of the securities may be effected from time
to time in one or more transactions at a fixed price or prices, which may be
changed, at varying prices determined at the time of sale, or at prices
determined as the applicable prospectus supplement specifies. The securities may
be sold through a rights offering, forward contracts or similar arrangements. In
any distribution of subscription rights to stockholders, if all of the
underlying securities are not subscribed for, we may then sell the unsubscribed
securities directly to third parties or may engage the services of one or more
underwriters, dealers or agents, including standby underwriters, to sell the
unsubscribed securities to third parties.
In
connection with the sale of the securities, underwriters, dealers or agents may
be deemed to have received compensation from us in the form of underwriting
discounts or commissions and also may receive commissions from securities
purchasers for whom they may act as agent. Underwriters may sell the securities
to or through dealers, and the dealers may receive compensation in the form of
discounts, concessions or commissions from the underwriters or commissions from
the purchasers for whom they may act as agent.
We
will provide in the applicable prospectus supplement information regarding any
underwriting discounts or other compensation that we pay to underwriters or
agents in connection with the securities offering, and any discounts,
concessions or commissions which underwriters allow to dealers. Underwriters,
dealers and agents participating in the securities distribution may be deemed to
be underwriters, and any discounts and commissions they receive and any profit
they realize on the resale of the securities may be deemed to be underwriting
discounts and commissions under the Securities Act. Underwriters and their
controlling persons, dealers and agents may be entitled, under agreements
entered into with us, to indemnification against and contribution toward
specific civil liabilities, including liabilities under the Securities
Act.
Unless
otherwise specified in the related prospectus supplement, each series of
securities will be a new issue with no established trading market, other than
shares of common stock of India Globalization Capital, Inc., which are listed on
the NYSE Amex. Any common stock sold pursuant to a prospectus supplement will be
listed on the NYSE Amex, subject to official notice of issuance. We may elect to
list any series of preferred stock on an exchange, but we are not obligated to
do so. It is possible that one or more underwriters may make a market in the
securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given as to the liquidity of, or the trading market for, any offered
securities.
In
connection with an offering, the underwriters may purchase and sell securities
in the open market. These transactions may include short sales, stabilizing
transactions and purchases to cover positions created by short sales. Short
sales involve the sale by the underwriters of a greater number of securities
than they are required to purchase in an offering. Stabilizing transactions
consist of bids or purchases made for the purpose of preventing or retarding a
decline in the market price of the securities while an offering is in progress.
The underwriters also may impose a penalty bid. This occurs when a particular
underwriter repays to the underwriters a portion of the underwriting discount
received by it because the underwriters have repurchased securities sold by or
for the account of that underwriter in stabilizing or short-covering
transactions. These activities by the underwriters may stabilize, maintain or
otherwise affect the market price of the securities. As a result, the price of
the securities may be higher than the price that otherwise might exist in the
open market. If these activities are commenced, they may be discontinued by the
underwriters at any time. Underwriters may engage in over-allotment. If any
underwriters create a short position in the securities in an offering in which
they sell more securities than are set forth on the cover page of the applicable
prospectus supplement, the underwriters may reduce that short position by
purchasing the securities in the open market.
Underwriters,
dealers or agents that participate in the offer of securities, or their
affiliates or associates, may have engaged or engage in transactions with and
perform services for, us or our affiliates in the ordinary course of business
for which they may have received or receive customary fees and reimbursement of
expenses.
In
compliance with the guidelines of the Financial Industry Regulatory Authority,
Inc. (“FINRA”), the maximum discount or commission to be received by any FINRA
member or independent broker-dealer may not exceed 8% of the aggregate offering
price of the shares offered hereby.
Unless
otherwise indicated in the applicable prospectus supplement, the validity of any
securities offered by this prospectus will be passed upon for us by Seyfarth
Shaw LLP, Chicago, Illinois. Seyfarth Shaw may also provide opinions
regarding certain other matters. If legal matters in connection with
offerings made pursuant to this prospectus are passed upon by counsel to
underwriters, dealers or agents, if any, such counsel will be named in the
prospectus supplement related to such offering.
The
consolidated financial statements and financial statement schedule of India
Globalization Capital, Inc. and subsidiaries as of March 31, 2008 and 2007, and
for each of the years in the two-year period ended March 31, 2009, have been
incorporated by reference herein and in the registration statement in reliance
upon the reports of Yoganandh & Ram, an independent registered public
accounting firm, incorporated by reference herein, and upon the authority of
said firms as experts in accounting and auditing.