india-defr14a332008.htm


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 

 
SCHEDULE 14A
 

 
(RULE 14a-101)
 
INFORMATION REQUIRED IN PROXY STATEMENT
 
SCHEDULE 14A INFORMATION
 
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
 
Filed by the Registrant 
þ
Filed by a Party other than the Registrant
o
 
Check the appropriate box:
 
¨
Preliminary Proxy Statement
¨
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
¨
Definitive Proxy Statement
þ
Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
 
India Globalization Capital, Inc. 
(Name of Registrant as Specified In Its Charter)
 
 
                                                                                                                                                  
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
 
Payment of Filing Fee (Check the appropriate box):
 
£
No fee required.
 
þ
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
 
 
(1)
Title of each class of securities to which transaction applies:  Common stock, par value $0.0001 per share
 
(2)
Aggregate number of securities to which transaction applies:  0 shares (cash transaction)
 
(3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined):  Not applicable.
 
(4)
Proposed maximum aggregate value of transaction: $56,000,000(1)*
 
(5)
Total fee paid: $2,166.50
 
 
þ  
Fee paid previously with preliminary materials:
 
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing.
 
 
(1)
Amount previously paid: _________________________________
 
(2)
Form, Schedule or Registration Statement No.:  ________________
 
(3)
Filing Party: ________________
 
(4)
Date Filed: _________________
 
Copies of all communications to:
Michael E. Blount, Esq.
Stanley S. Jutkowitz, Esq.
Seyfarth Shaw LLP
131 South Dearborn, Suite 2400
Chicago, Illinois 60603
(312) 460-5000
 
*Based on an exchange rate of $1.00 = INR 39.23 on November 19, 2007. Pursuant to paragraphs (c), (f)(1) and (f)(3) of Rule 457 and estimated solely for the purpose of calculating the filing fee. 
1

 
 
INDIA GLOBALIZATION CAPITAL, INC.
4336 Montgomery Avenue
Bethesda, MD, 20814
(301) 983-0998
 
To the Stockholders of India Globalization Capital, Inc.:
 
 
You recently received our proxy statement dated February 6, 2008 (the “Proxy Statement”) concerning the upcoming special meeting of the stockholders of India Globalization Capital, Inc. (“we,” “us” or “IGC”). The Proxy Statement includes a proposal to approve the “Acquisition Proposal” of IGC acting directly or indirectly through one or more newly formed affiliates, consisting of the following proposed acquisitions: (a) acquisition of a 63% equity interest in Sricon Infrastructure Private Limited (“Sricon”), (b) the acquisition of convertible preference shares, and a direct equity interest in Techni Bharathi Limited (“TBL”) and (c) the acquisition from Odeon Limited of convertible preference shares of TBL, which when converted along with the convertible preference shares purchased directly from TBL would result in IGC owning a 77% equity interest in TBL.
 
Please note that we have rescheduled the special meeting of our stockholders to 10:00 a.m., Eastern Time, on Thursday, March 6, 2008, at the offices of Seyfarth Shaw, LLP, 815 Connecticut Avenue, N.W., Suite 500, Washington, D.C. 20006-4004.
 
Since we sent you the Proxy Statement, we have had further discussions with Sricon and TBL, and they have agreed in principle to loan us an aggregate of approximately $23,000,000 conditioned upon, and subsequent to, the consummation of the transactions contemplated by the Acquisition Proposal.  These loans, if made, would not change the terms of the Acquisition Proposal or any of the other proposals we have asked you to vote on at the special meeting of stockholders. The consummation of the transactions contemplated by the Acquisition Proposal is not conditioned on Sricon and TBL making the loans to us.
 
One of the potential uses of the loan proceeds may be to repurchase from no more than 10 stockholders all or a portion of the shares of stock that they hold in exchange for each of the stockholders agreeing to vote such shares in favor of, or to change their vote to vote in favor of, the proposals presented at the stockholders meeting or granting us a proxy to vote their shares in our discretion.  The repurchases will be made in individually negotiated transactions, and we are not making a general offer to repurchase the shares held by our stockholders.  While we do not have any such agreements currently in place, we anticipate that the repurchases would be structured in a manner that would provide for settlement of the repurchases subsequent to the consummation of the transactions contemplated by the Acquisition Proposal (the “Acquisition”).  The funds for the repurchases would come solely from the Sricon and TBL loans, and we estimate that we could spend up to the total proceeds of the loans to repurchase shares.  Alternatively, we may use some or all the loan proceeds for general corporate purposes but currently have no specific plans for the use of the proceeds in this fashion.
 
Enclosed is a supplement to the Proxy Statement containing additional information concerning the Sricon and TBL loans and our proposed use of the loan proceeds. We urge you to read this material carefully. In particular, you should carefully consider the discussion in the section entitled “Additional Risk Factors” beginning on page 19 of the supplement.  We have also enclosed a new proxy card for your use if you have not yet voted on the matters to be considered at the special meeting or if you wish to change your prior vote after reviewing the supplement.
 
If you have any questions or need assistance in voting your shares, please call me at (301) 983-0998.
 
 
Sincerely yours,
/s/ Ram Mukunda                
Ram Mukunda
 
2

 
SUPPLEMENT TO PROXY STATEMENT FOR SPECIAL MEETING OF
STOCKHOLDERS OF
INDIA GLOBALIZATION CAPITAL, INC.
 
MARCH 6, 2008
 
 
The following information amends and supplements the proxy statement dated February 6, 2008 (the “Proxy Statement”) previously sent to the stockholders of India Globalization Capital, Inc. (“we,” “us” or “IGC”) and should be read in conjunction with the Proxy Statement, which is incorporated herein by reference.  If, after reviewing this supplement, you wish to change to your vote with respect to any of the matters to be voted on at the special meeting of stockholders, please read “How to Change Your Vote” on page 22 for instructions on how to do so. We have enclosed an additional proxy card for your convenience.
 
THE SRICON AND TBL LOANS
 
Terms of the Loans
 
 
Subsequent to the mailing date of the Proxy Statement, the Company has entered into agreements in principle with Sricon and TBL pursuant to which Sricon and TBL will loan us up to an aggregate of approximately $23,000,000 following the consummation of the transactions contemplated by the Acquisition Proposal on the following terms:
 
 
·  
Sricon will lend us up to approximately $17,000,000 and TBL will lend us up to approximately $6,000,000.
·  
The loans will bear interest at a rate equal to the applicable federal rate at the time the loans are made.
·  
Principal and interest on the loans will be due and payable upon the earlier of the first anniversary of the loans and the consummation of the sale of all or substantially all of the assets or stock of IGC.
·  
The loans may be prepaid at any time without penalty.
·  
Our obligations under the loans will be unsecured.
 
The loans will be conditioned upon he consummation of the transactions contemplated by the Acquisition Proposal.  The terms of the Acquisition Proposal and the other proposals to be voted on at the special meeting of the stockholders remain unchanged, and the consummation of the transactions contemplated by the Acquisition Proposal is not conditioned on Sricon and TBL making the loans to us. When we enter into definitive agreements with respect to the loans, we will file a Form 8-K with the Securities and Exchange Commission which will include copies of the loan agreements as exhibits.

Use of Loan Proceeds

One of our potential uses of the loan proceeds not expressly contemplated by our prospectus or the Proxy Statement may be to repurchase from no more than 10 stockholders in privately negotiated transactions all or a portion of the shares of stock that they hold in exchange for such stockholders agreeing to vote in favor of, or to change their vote to vote in favor of, the proposals presented at the stockholders meeting or granting us a proxy to vote their shares in our discretion.  The repurchases will be made in individually negotiated transactions, and we are not making a general offer to repurchase the shares held by our stockholders.  We anticipate that the repurchases would be structured in a manner that would provide for settlement of the repurchases subsequent to the consummation of the transactions contemplated by the Acquisition Proposal and would be conditioned upon the approval and completion of the Acquisition Proposal.  We will not repurchase shares for an aggregate repurchase price in excess of the proceeds of the loans from Sricon and TBL.  At this time, we have not entered into any agreements with any stockholders with respect to the repurchase of our shares.  These shares would be purchased at prices to be negotiated between us and the stockholders, although we expect that the per share price would be equal to the per share amount held in trust for payment to the holders of our common stock who vote against the Acquisition Proposal and request conversion of their shares. The amount in the trust account in which a substantial portion of the proceeds of our initial public offering is deposited (the “Trust Account”) as of December 31, 2007 was approximately $5.92 per share (net of estimated taxes).  We intend to retire any shares repurchased in this fashion, reducing the number of our outstanding shares.  Alternatively, we may use some or the entire loan proceeds for general corporate purposes but currently have no specific plans for the use of the proceeds in this fashion.

Shares of our common stock that are purchased in such transactions will not be counted towards whether the holders of 20% or more of the shares of common stock issued in our initial public offering (“Public Shares”) have voted against the transaction and demanded that we convert their shares to their pro rata share of the Trust Account.  Our amended and restated certificate of incorporation provides that we cannot complete the Acquisition if the holders of 20% or more of the Public Shares vote against the Acquisition Proposal and demand conversion of their shares into a pro rata portion of the Trust Account.  While we expect that the purchase price of any shares we repurchase will be approximately equal to the price per share payable upon conversion, the shares repurchased will be voted in favor of the Acquisition Proposal and will not be eligible to elect conversion.  In addition, the shares being repurchased will be repurchased pursuant to separately negotiated contractual arrangements and not in accordance with the shareholders’ conversion rights.  Accordingly, any repurchased shares would not be included with the shares that elect conversion.
 
3

 
Impact of the Loans On Us
 
As the loans and any stock repurchases would occur subsequent to, and be conditioned upon, the Acquisition Proposal, we do not anticipate that the loans or stock repurchases structured in the manner described above will have any impact on the funds available to our stockholders upon conversion of their shares or upon our liquidation if the Acquisition Proposal is not approved by our stockholders.
 
If we borrow the funds from Sricon and TBL we anticipate that we will not have sufficient cash remaining to repay the loans after payment of the purchase price for the acquisition of Sricon and TBL stock and the payments to any of our stockholders that elect to convert their shares into cash.  Accordingly, unless we receive sufficient revenues from the target companies or from holders of our warrants exercising the warrants we will likely need to raise additional funds to repay the loans.  Among the methods we may use to raise funds include the sale of additional equity securities, or the sale of debt securities together with equity securities, such as warrants, which would dilute our existing stockholders.
 
As disclosed in our Proxy Statement in the section entitled “Additional Investment Activity – Wind Farm Purchase Agreement”, we have also entered into a Contract Agreement dated April 29, 2007, as subsequently amended (“CWEL Purchase Agreement”), with Chiranjjeevi Wind Energy Limited, Arul Mariamman Textiles Limited, and Marudhavel Industries Limited (collectively, “CWEL”) pursuant to which IGC will acquire 100% of a 24-mega watt wind energy farm, consisting of 96 250-kilowatt wind turbines, located in Karnataka, India to be manufactured by CWEL (the “CWEL Acquisition”).  At closing, the purchase price for the 24-mega watt wind energy farm is INR 1,140,000,000 (approximately $28,500,000 based on a conversion ratio of $0.025 per INR.).  The price is subject to revision based on the prices of major components at closing. We have previously made a $250,000 deposit toward the purchase price.  The actual payments made to CWEL will be spread over nine to twelve months.  We noted in our Proxy Statement that we anticipate obtaining a credit facility for about $22.1 million to help finance the CWEL Acquisition.  We have not yet obtained this credit facility, and if the Sricon and TBL loans remain outstanding, it may be more difficult or expensive for us to obtain this facility than it would if we did not enter into the Sricon and TBL loans.  The CWEL Acquisition is not part of the Acquisition Proposal, and you will not be voting on the CWEL Acquisition at the stockholders meeting.
 
Impact of the Loans on Sricon and TBL
 
We believe that Sricon and TBL are capable of maintaining operations at their current levels with the portion of the purchase price they would respectively retain if they made the proposed loans to us.  However, without obtaining capital from other sources, they may lack sufficient capital in the short term to permit them to bid on larger build, operate and transfer (“BOT”) contracts, which could impact their long term revenues.  We believe that Sricon and TBL could obtain capital from other sources if the need arises, but the additional cost of that capital could negatively impact their earnings.
 
In the Proxy Statement, we identified a number of potential uses for the capital provided by us to the targets in order to improve their earnings margins.  See “The Acquisition Proposal – Industry Background: Infrastructure - Sricon Infrastructure Private Limited (Sricon) – Sricon Projections” and “The Acquisition Proposal – Industry Background: Infrastructure - Techni Bharathi Limited (TBL) – Short/Medium Term Margin Expansion” in the Proxy Statement.  These uses included paying vendors for raw materials in a more timely fashion, purchasing additional equipment and lowering interest costs by, among other things, improving the balance sheets of the targets.  We believe that if we repay the loans when due that Sricon and TBL should have sufficient capital on hand to apply to the first two of these uses over the next year.  However, the loans to us may result in a delay in the projected margin increases attributable to lowering interest costs depending on when the loans are repaid.  If we are unable to repay the loans on time, Sricon and TBL may not be able to maintain the projected margin improvements in future years.
 
 
INTERESTS OF OUR DIRECTORS AND OFFICERS IN THE ACQUISITION
 
 
If we are unable to consummate the Acquisition by March 8, 2008, we will be forced to liquidate.  When you consider the recommendation of our board of directors that you vote in favor of adoption of the Acquisition Proposal, you should keep in mind that certain of our directors and officers have interests in the Acquisition that are different from, or in addition to, your interest as a stockholder. These interests include, among other things, that if the Acquisition is not approved and we are required to liquidate, the stock and units issued to our executives and directors prior to the consummation of our public offering, including those purchased by our executives and directors in the private placement immediately preceding the public offering, will be worthless, because these shares will not participate in any distribution of the assets held in our Trust Account. As of the record date, our present and past executives, directors and advisors owned a total of 2,500,000 shares of our common stock and 170,000 of our Units. In addition, Richard Prins has received an option to purchase 71,250 units, at a strike price of $7.50, from the Underwriters Purchase Option (UPO) that we granted to the underwriter, Ferris, Baker Watts and Ranga Krishna, our Chairman of the Board, is entitled to receive 446,226 shares of our common stock if we consummate the Acquisition under the terms of a $4,300,000 loan made by Dr. Krishna to us, which loan shall be due and payable upon the earlier of 10 days after the completion of the Acquisition and December 24, 2008. The note evidencing the loan provides that Dr. Krishna will have no recourse against the Trust Account for repayment of the loan if we do not consummate a business combination.  Accordingly, if we do not consummate a business combination we may not have the funds available to repay Dr. Krishna’s loan,
 
4

 
Mr. Suhail Nathani is a partner at the law firm of ELP in Mumbai, India. He is also one of our directors. His law firm is responsible for the legal due diligence and for drafting the purchase agreements. Our board of directors took the relationship into consideration, and debated the potential conflicts before approving the hiring of ELP for representing us in India. Nathani did not take part in the board’s approval process of choosing ELP as our Indian legal council. One of the key considerations that the board took into account was the experience that Nathani and other ELP partners have in mergers, acquisitions, Indian and US securities law and cross border relations. While ELP is paid their standard fee for the work they did and continue to do for us, there is no arrangement of a success fee of any kind associated with the Acquisition Proposal.
 
In addition, we anticipate that following the completion of the Acquisition, Ranga Krishna will serve as the chairman of our board of directors, Ram Mukunda will serve as the executive chairman, president and chief executive officer, Sudhakar Shenoy, Suhail Nathani and Richard Prins will remain on our board of directors. Each of our directors and officers will, following the Acquisition, be compensated in such manner, and in such amounts, as our board of directors may determine to be appropriate, subject in the case of our officers to the requirements of any employment agreements entered into with them.
 
 
SELECTED SUMMARY HISTORICAL FINANCIAL INFORMATION
 

 Selected Summary Historical Financial Information

All three companies IGC, Sricon and TBL, have fiscal years that end at March 31. The following financial information is provided to assist you in your analysis of the financial aspects of the proposed acquisition transactions. IGC’s historical information is derived from (i) its audited financial statements as of March 31, 2007 and for the period from its inception (April 29, 2005) to March 31, 2007, and (ii) its unaudited condensed financial statements as of December 31, 2007 and for the nine months ended December 31, 2007 and 2006. Sricon’s historical information is derived from (i) its audited financial statements as at March 31, 2006 and 2007 and for the years ended March 31, 2005, 2006 and 2007, and (ii) its unaudited condensed financial statements as of December 31, 2007 and for the nine months ended December 31, 2007 and 2006.   TBL’s historical information is derived from (i) its audited financial statements as at March 31, 2006 and 2007, and for the years ended March 31, 2005, 2006 and 2007, and (ii) its unaudited condensed financial statements as of December 31, 2007 and for the nine months ended December 31, 2007 and 2006.  The information is only a summary and should be read in conjunction with each of IGC’s, Sricon’s and TBL’s historical financial statements and related notes.  The historical results included below and elsewhere herein are not indicative of the future performance of IGC, Sricon and TBL.

India Globalization Capital, Inc.
Selected Summary Statement of Income Data

(Amounts in US Dollars, except share data and as stated otherwise)
 
From Inception
(April 29, 2005) to March 31, 2006
   
Year Ended
March 31, 2007
   
Nine Months Ended
December 31, 2006
   
Nine Months Ended
December 31, 2007
 
Interest income
 
$
210,584
   
$
3,171,818
   
$
2,414,645
   
$
1,836,957
 
Income (loss) before income taxes
   
(398,840
   
2,302,855
     
1,814,816
     
(118,277
Provision for Income taxes
   
(45,000
   
(784,858
   
(623,625
   
(40,026
)
Net income (loss)
   
(443,840
   
1,517,997
     
1,191,191
     
(78,251
)
Weighted average shares outstanding – basic and diluted
   
3,191,000
     
13,974,500
     
13,974,500
     
13,974,500
 
Net income (loss) per share – basic and diluted
 
$
(0.14
 
$
0.11
   
$
0.09
   
$
(0.01
)


India Globalization Capital, Inc.
Selected Summary Balance Sheet Data

   
March 31, 2006
   
March 31, 2007
   
December 31, 2007
 
ASSETS
                 
Investments held in trust fund
  $ 65,825,016     $ 66,104,275     $ 66,938,208  
LIABILITIES AND STOCKHOLDERS' EQUITY
                       
Common stock subject to possible conversion
    12,762,785       12,762,785       12,762,785  
Total stockholders’ equity
  $ 50,170,702     $ 52,923,699     $ 52,845,448  

 
5

 
Sricon Infrastructure Private Limited
Selected Summary Statement of Income Data

 
   
Year Ended
   
Nine months ended
 
(Amounts in Thousand US Dollars except share data and as stated otherwise)
 
March 31, 2003
   
March 31, 2004
   
March 31, 2005
   
March 31, 2006
   
March 31, 2007
   
December 31, 2006
   
December 31, 2007
 
Revenue
 
$
4,580
   
$
15,298
   
$
11,477
   
$
11,011
   
$
10,604
   
$
8,404
   
$
    16,865
 
Income before income taxes
   
320
     
646
     
907
     
668
     
778
     
265
     
2,756
 
Income taxes
   
(69
   
(199
   
(363
   
(186
   
(368
   
(108
   
(561
Net Income
   
251
     
446
     
544
     
482
     
410
     
157
     
2,195
 
Earning per share - basic and diluted
 
$
0.12
   
$
0.11
   
$
0.19
   
$
0.16
   
$
0.14
   
$
0.05
   
$
0.75
 
Weighted average number of shares outstanding
   
95,200
     
183,259
     
2,932,159
     
2,932,159
     
2,932,159
     
2,932,159
     
2,932,159
 


Sricon Infrastructure Private Limited
Selected Summary Balance Sheet Data

                                     
(Amounts in Thousand US Dollars)
 
As of March 31, 2003
   
As of March 31, 2004
   
As of March 31, 2005
   
As of March 31, 2006
   
As of March 31, 2007
   
As of December 31, 2007
 
ASSETS
                                   
Accounts receivables
  $ 234     $ 2,223     $ 2,128     $ 2,083     $ 2,751     $ 11,442  
Unbilled receivables
    357       984       974       2,980       2,866       1,896  
Inventories
    43       71       154       248       71       325  
Property and equipment, net
    1,461       3,098       3,424       4,347       4,903       5,599  
BOT Project under progress
    -       -       -       1,584       3,080       -  
LIABILITIES
                                               
Short-term borrowings and current portion of long-term debt
    -       359       5,103       3,868       3,646       3,940  
Due to related parties
    217       1,553       1,724       1,604       2,264       1,210  
Long-term debt, net of current portion
    404       1,089       1,278       1,855       2,182       2,264  
Other liabilities
    462       1,267       1,307       697       1,913       1,820  
Total stockholders’ equity
  $ 1,189     $ 2,822     $ 2,760     $ 3,740     $ 4,289     $ 9,219  

 
6


 Techni Bharathi Limited
Selected Summary Statement of Operations Data

   
Year Ended
   
Nine months ended
 
(Amounts in Thousand US Dollars, except share data and as stated otherwise)
 
March 31, 2003
   
March 31, 2004
   
March 31, 2005
   
March 31, 2006
   
March 31, 2007
   
December 31,  2006
   
December 31, 2007
 
Revenue
  $ 13,145     $ 8,773     $ 8,954     $ 2,285     $ 4,318     $ 396     $ 5,042  
Income (loss) before income taxes
    722       (2,609 )     (3,823 )     (2,369 )     401       (1,220 )     3,184  
Income taxes
    322       (63 )     515       62       135       12       (202 )
Net (loss)/income
    400       (2,672 )     (3,308 )     (2,307 )     536       (855 )     2,982  
Earnings (loss) per share
                                                       
Basic
  $ 0.09     $ (0.62 )   $ (0.77 )   $ (0.54 )   $ 0.13     $ (0.30 )   $ 0.66  
Diluted
  $ 0.09     $ (0.62 )   $ (0.77 )   $ (0.54 )   $ 0.13     $ (0.30 )   $ 0.66  
Weighted average number of shares outstanding
                                                       
Basic
    4,287,500       4,287,500       4,287,500       4,287,500       4,287,500       4,287,500       4,287,500  
Diluted
    4,287,500       4,287,500       4,287,500       4,287,500       4,287,500       4,287,500       4,287,500  


Techni Bharathi Limited
Selected Summary Balance Sheet Data

   
 
 
(Amounts in Thousand US Dollars)
 
As of March 31,  2003
   
As of March 31, 2004
   
As of March 31, 2005
   
As of March 31, 2006
   
As of March 31, 2007
   
As of December 31, 2007
 
ASSETS
                                   
Cash and cash equivalents
  $ 200     $ 107     $ 83     $ 69     $ 1,208     $ 157  
Inventories
    4,728       4,922       4,459       4,182       1,284       1,585  
Prepaid and other assets
    1,777       2,070       1,765       1,275       1,231       75  
Property, plant and equipment (net)
    3,622       3,985       3,463       2,417       2,265       2,106  
LIABILITIES
                                               
Short term borrowings and current portion of long-term loan
    1,495       6,614       6,291       8,125       6,079       4,142  
Trade payable
    3,348       2,738       3,341       987       1,502       886  
Long term debts, net of current portion
    4,883       2,892       3,897       3,656       2,333          
Advance from customers
    1,488       2,755       3,057       2,997       1,877       846  
Total Stockholders' equity
  $ 2,927     $ 320     $ (3,032 )   $ (5,438 )   $ (4,895 )   $ (1,172 )

 
7


 
UNAUDITED PRO FORMA CONDENSED FINANCIAL STATEMENT

The following unaudited pro forma condensed balance sheet combines the historical balance sheets of Sricon, TBL and IGC as of December 31, 2007, giving effect to the Acquisition as if it had been consummated on December 31, 2007.

The following unaudited pro forma condensed statement of operations for the nine months ended December 31, 2007 combines the condensed unaudited statements of operations of TBL for the nine  months ended December 31,  2007 and the condensed unaudited statement of operations of Sricon for the nine months ended December 31, 2007 with the unaudited statement of operations of IGC for the nine months period ended December 31, 2007, giving effect to the Acquisition as if it had occurred at the beginning of the periods presented.

The following unaudited pro forma statement of operations for the fiscal year ended March 31, 2007 combines the audited statements of operations of TBL for the fiscal year ended March 31, 2007 and the audited statement of operations of Sricon for the fiscal year ended March, 2007 with the audited statement of operations of IGC for the fiscal year ended March 31, 2007, giving effect to the Acquisition as if it had occurred at the beginning of the periods presented.

The historical financial information has been adjusted to give effect to pro forma events that are directly attributable to the Acquisition, are factually supportable and are expected to have a continuing impact on the combined results.

In addition to the Acquisition Proposal we expect to fund a wind energy farm that will be constructed by CWEL. The 24-mega watt wind energy farm is expected to cost INR 1,140,000,000 (about USD 28.5 million, at an exchange rate of INR 40 per USD). We expect to fund the construction of the wind energy farm through a yet to be formed, wholly owned Indian subsidiary called IGC-Power. We expect to invest approximately USD 6,150,000 in equity to capitalize IGC-Power, transfer the deposit of $250,000 from CWEL to IGC-Power and anticipate obtaining a credit facility for about USD 22.1 million. No arrangements have yet been made for the debt financing.  We expect to file a Form 8-K setting forth the details of the debt financing if and when the arrangements are finalized.  Because the wind farm has not yet been constructed, the pro forma financial statements do not reflect the impact of the proposed wind farm because such inclusion would constitute a forecast or projection.  However, the $250,000 we have paid as a deposit on the wind farms is reflected on the pro forma statements.

The unaudited pro forma condensed unaudited balance sheet information at December 31, 2007, and the unaudited pro forma condensed statement of operations for the nine months ended December 31, 2007, and the fiscal year ended March 31, 2007, have been prepared using two different levels of approval of the transaction by the IGC stockholders, as follows:

·  
Assuming No Exercise of Redemption Rights: This presentation assumes that none of the IGC stockholders exercise their redemption rights; and
·  
Assuming Maximum Exercise of Redemption Rights: This presentation assumes that stockholders holding 2,259,770 common stock exercise their redemption rights.

In addition, a third case is also presented:  After the business transaction is consummated and conditioned on the business combination being consummated, we expect that our subsidiaries Sricon and TBL will loan IGC up to about $23 Million.  We may use some or all of this cash to purchase IGC shares from no more than 10 of our shareholders.  We expect to pay no more than an amount equal to the per share amount in escrow as of the closing, expected to be about $5.92 per share.  The Pro Forma scenario presented here assumes that all $23 Million will be used to purchase shares and maximum exercise of redemption rights.

·  
Assuming that we use $23 Million to purchase and retire shares and assuming Maximum Exercise of Redemption Rights.

We are providing the following information to aid you in your analysis of the financial aspects of the acquisition.

We derived the pro forma information for the nine months ended December 31, 2007 from the condensed unaudited condensed financial statements of Sricon for the nine months ended December 31, 2007, the condensed unaudited financial statements of TBL for the nine months ended December 31, 2007 and from the unaudited condensed financial statements of IGC for the nine months ended December 31, 2007.

We derived the pro forma information for the fiscal year ended March 31, 2007 from the audited financial statements of Sricon, TBL and IGC for the fiscal year ended March 31, 2007.

This information should be read together with IGC’s audited and unaudited financial statements and related notes, the Sricon audited and unaudited financial statements and related notes, the TBL audited and unaudited financial statements and related notes and other financial information included elsewhere in the proxy statement.
 
8


 
The unaudited pro forma condensed information is for illustrative purposes only. The financial results may have been different had the companies always been combined. You should not rely on the unaudited pro forma condensed financial information as being indicative of the historical results that would have been achieved had the companies always been combined or the future results that the combined company will experience. IGC, Sricon and TBL have not had any historical relationships prior to the Acquisition. Accordingly, no pro forma adjustments were required to eliminate activities among the companies.

In the proposed acquisition of Sricon, IGC intends to acquire 4,041,676 newly-issued equity shares directly from Sricon and 351,840 equity shares from the promoters so that at the conclusion of the transactions contemplated by the Sricon Subscription Agreement, IGC will own   approximately   63% of the outstanding equity shares of Sricon in exchange for consideration consisting of: (i) INR 120,000,000 (approximately $3,000,000 at an exchange rate of INR 40 per USD) in cash at closing for the Sale Shares, representing a price per share of INR 341.06 (approximately $8.53 per share at an exchange rate of INR 40 per USD), (ii) INR 1,030,000,000 (approximately $25,750,000 at an exchange rate of INR 40 per USD) in cash at closing for the New Sricon Shares, representing a price per share of INR 254.84 approximately $6.37 at an exchange rate of INR 40 per USD).

In the proposed acquisition of TBL, IGC intends to acquire 7,150,000 newly-issued equity shares and 12,500,000 newly-issued 6% compulsorily convertible preference shares (CPS), which may be converted to 2,100,000 shares of common stock, directly from TBL, and 5,000,000 convertible preference shares of TBL (the “TBL Preference Shares”) from Odeon so that at the conclusion of the transactions contemplated by the TBL Subscription Agreement, IGC will own, assuming both convertibles are converted, approximately 77% of the outstanding equity shares of TBL on a fully-diluted basis for consideration consisting of: (i) INR 275,000,000 (approximately  $6,875,000 at an exchange rate of INR 40 per USD) in cash at closing for the 7,150,000 new equity shares, representing a price per share of INR 38.46 (approximately $0.96 at an exchange rate of INR 40 per USD), (ii) INR 125,000,000 (approximately $3,125,000 at an exchange rate of INR 40 per USD) in cash at closing for the CPS, representing a price per share of INR 10.00 (approximately $0.25 at an exchange rate of INR 40 per USD) and (iii) $2,000,000 in cash at closing for the TBL convertible preference shares acquired from Odeon, representing a price per share of $0.40.

The Acquisition will be accounted for as a business combination with IGC as the accounting acquirer. The determination of IGC as the accounting acquirer has been made based on an evaluation of the relevant factors and circumstances of the Acquisition, including among other factors that IGC stockholders will own a majority stake of the acquired companies upon consummation of the Acquisition, and that certain members of IGC’s board of directors will serve on the board of directors of the acquired companies.  Under the purchase method of accounting, the assets and liabilities of Sricon and TBL acquired by IGC will be recorded as of the acquisition date at their respective fair values, and added to those of IGC.

The purchase price for the respective acquisitions will be determined based on the cash consideration given in exchange for the issued and outstanding shares of Sricon and TBL.  The allocation of the purchase price including the evaluation and computation of deferred taxes, if any, resulting from the Acquisition reflected in the unaudited pro forma condensed financial statements is preliminary and subject to change based on finalization of IGC’s valuation of the acquired assets and liabilities of Sricon and TBL. The pro forma information presented, for the purchase price allocation, is based on preliminary estimates of the fair values of assets acquired and liabilities assumed in connection with the Acquisition.  These preliminary estimates are based on available information and certain assumptions we consider reasonable and may be revised as additional information becomes available. These preliminary valuation estimates were derived by management and are reflected in the fair values in these unaudited pro forma condensed financial statements. The final purchase price allocation for the Acquisition will be dependent upon the finalization of asset and liability valuations, which may depend in part on prevailing market rates and conditions. A final determination of these fair values will include assistance provided by an independent appraiser, which will be completed subsequent to the consummation of the Acquisition. These final valuations will be based on the actual net tangible and intangible assets that existed as of the closing date of the Acquisition. Any final adjustments may change the allocations of purchase price, which could affect the fair value assigned to the assets acquired and liabilities assumed and could result in a material change to the unaudited pro forma condensed financial statements, including the amount recorded in respect of goodwill.

9


SELECTED UNAUDITED PRO FORMA CONDENSED BALANCE SHEET INFORMATION
AS OF DECEMBER 31, 2007


   
Consolidated
   
Consolidated
   
Consolidated
 
   
Assuming No
   
Assuming Maximum
   
Assuming Maximum
 
   
Exercise of
   
Exercise of
   
Buy Back of Stock
 
   
Redemption Rights
   
Redemption Rights
   
and Maximum Redemption
 
                   
Total Current Assets
  $ 77,301,079     $ 64,256,552     $ 41,256,552  
Property and equipment, net
    7,704,887       7,704,887       7,704,887  
Goodwill
    13,068,689       13,068,689       13,068,689  
Total Assets
    102,759,290       89,714,763       66,714,763  
Long-term debt, net of current portion
    3,028,474       3,028,474       3,028,474  
Minority Interest
    14,980,406       14,980,406       14,980,406  
Total stockholders’ equity
    65,349,484       52,304,957       29,304,957  



10


UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
AS OF DECEMBER 31, 2007

                   
Pro Forma
     
Consolidated
         
Consolidated
           
Consolidated
 
   
Sricon
   
TBL
   
IGC
 
Adjustments
     
Assuming No
         
Assuming
           
Assuming
 
                           
Exercise of
         
Maximum
           
Maximum
 
                           
Redemption
         
Exercise of
           
Buy Back of
 
                           
Rights
         
Redemption
           
Stock and
 
                                       
Rights
           
and Maximun
 
                                                     
Redemption
 
ASSETS
                                                       
                                                         
Current Assets:
                                                       
Cash and cash equivalents
  $ 866,436     $ 156,882     $ 2,208,160     66,938,208  
(a)
  $ 55,659,040     (12,762,785 )
(h)
  $ 42,614,513       (23,000,000 )
(a)
  $ 19,614,513  
                            35,750,000  
(a)
          (281,742 )
(h)
                         
                            (32,340,721 )
(a)
                                         
                            (5,000,000 )
(a)
                                         
                            (5,182,287 )
(d)
                                         
                            (4,216,988 )
(e)
                                         
                            (1,769,400 )
(f)
                                         
                            (1,601,250 )
(g)
                                         
                            (150,000 )
(a)
                                         
Accounts Receivable
    11,442,073       644,041       -               12,086,114               12,086,114                 12,086,114  
Unbilled Receivables
    1,895,829       -       -               1,895,829               1,895,829                 1,895,829  
Inventories
    325,004       1,585,455       -               1,910,459               1,910,459                 1,910,459  
Investments held in Trust Fund
    -       -       66,938,208     (66,938,208 )
(a)
    -               -                 -  
Interest Receivable - Convertible Debenture
    -       -       217,479               217,479               217,479                 217,479  
Convertible debenture in MBL
    -       -       3,000,000               3,000,000               3,000,000                 3,000,000  
Loan Acquisition Costs
    -       -       237,705     150,000  
(a)
    -               -                 -  
                            (387,705 )
(a)
                                         
Prepaid Taxes
    -       -       49,289               49,289               49,289                 49,289  
Restricted cash
    -       40,393                       40,393               40,393                 40,393  
Prepaid expenses and other current assets
    818,272       74,790       7,625               900,687               900,687                 900,687  
Due from related parties
    1,455,065       86,725       -               1,541,790               1,541,790                 1,541,790  
Total Current Assets
    16,802,679       2,588,285       72,658,466               77,301,079               64,256,552                 41,256,552  
                                                                           
Property and equipment, net
    5,598,892       2,105,995       -     -         7,704,887               7,704,887                 7,704,887  
Goodwill
    -       -       -     13,068,689  
(a)
    13,068,689               13,068,689                 13,068,689  
Investment – others
    92,401       78,660       -               171,061               171,061                 171,061  
Deposit towards acquisitions
    -       -       3,670,000     (3,409,279 )
(a)
    260,721               260,721                 260,721  
Restricted cash, non-current
    240,222       178,208       -               418,430               418,430                 418,430  
Deferred acquisition costs
    -       -       233,189     1,601,250  
(g)
    699,117               699,117                 699,117  
                            (1,135,322 )
(a)
                                         
Deferred tax assets, net of valuation allowance
    -       166,153       891,547               1,057,700               1,057,700                 1,057,700  
Other assets
    814,001       1,263,605       -               2,077,606               2,077,606                 2,077,606  
Total Assets
  $ 23,548,195     $ 6,380,906     $ 77,453,202             $ 102,759,290             $ 89,714,763               $ 66,714,763  
 
11

                                                                           
LIABILITIES AND STOCKHOLDERS’ EQUITY
                                                                         
Current Liabilities:
                                                                         
Short-term borrowings and current portion of long-term debt
  $ 3,940,048       4,142,008       -               8,082,056               8,082,056                 8,082,056  
Trade payables
    788,086       885,831       -               1,673,917               1,673,917                 1,673,917  
Advance from Customers
    1,134,020       -                       1,134,020               1,134,020                 1,134,020  
Accrued expenses
    -       -     $ 851,613     (87,287 )
(d)
    547,337               547,337                 547,337  
                            (216,989 )
(e)
                                         
Notes payable to stockholders
    -       -       5,095,000     (5,095,000 )
(d)
    -               -                 -  
Deferred trust interest
    -       -       281,742     (281,742 )
(h)
    -               -                 -  
Note Payable to Oliveira Capital, LLC
    -       -       3,847,214     (3,847,214 )
(e)
    -               -                 -  
Due to Underwriters
    -       -       1,769,400     (1,769,400 )
(f)
    -               -                 -  
Due to related parties
    1,209,962       -       -               1,209,962               1,209,962                 1,209,962  
Other current liabilities
    2,507,840       915,734       -               3,423,574               3,423,574                 3,423,574  
Total current liabilities
    9,579,956       5,943,574       11,844,969               16,070,867               16,070,867                 16,070,867  
                                                                           
Long-term debt, net of current portion
    2,264,373       764,101       -               3,028,474               3,028,474                 3,028,474  
Advance from Customers
    -       845,606       -               845,606               845,606                 845,606  
Deferred taxes on income
    664,438       -       -               664,438               664,438                 664,438  
Other liabilities
    1,820,015       -       -               1,820,015               1,820,015                 1,820,015  
Total Liabilities
  $ 14,328,782     $ 7,553,281     $ 11,844,969             $ 22,429,400             $ 22,429,400               $ 22,429,400  
                                                                           
Minority Interest
    -       -       -     14,980,406  
(a)
    14,980,406               14,980,406                 14,980,406  
Common stock subject to possible conversion, 2,259,770 at conversion value
    -       -       12,762,785     (12,762,785 )
(h)
    -        
 
    -       -         -  
                                                                           
STOCKHOLDERS’ EQUITY
                                                                         
Preferred Stock
    -       1,182,033       -     (1,182,033 )
(a)
    -               -                 -  
Common stock
    674,000       988,000       1,397     (1,662,000 )
(a)
    2,173     (226 )
(h)
    1,947       (389 )
 (a)
    1,558  
                            226  
(h)
                                         
                            550  
(a)
                                         
Additional paid-in capital
    726,000       199,000       51,848,145     35,750,000  
(a)
    67,877,154     (12,762,559 )
(h)
    55,114,595       (22,999,611 )
 (a)
    32,114,984  
                            (36,675,000 )
(a)
                                         
                            12,762,559  
(h)
                                         
                            3,266,450  
(a)
                                         
Money received pending allotment
    3,239,279                     (3,239,279 )
(a)
    -               -                 -  
Retained earnings
    4,079,895       (3,097,878 )     995,906     (982,017 )
(a)
    (2,529,843 )   (281,742 )
(h)
    (2,811,585 )     -         (2,811,585 )
                            (152,786 )
(e)
                                         
                            281,742  
(h)
                                         
                            (387,705 )
(a)
                                         
                            (3,267,000 )
(a)
                                         
Accumulated other comprehensive (loss) income
    500,239       (443,530 )     -     (56,709 )
(a)
    -               -                 -  
Total stockholders’ equity
    9,219,413       (1,172,375 )     52,845,448               65,349,484               52,304,957                 29,304,957  
                                                                           
Total liabilities and stockholders’ equity
  $ 23,548,195     $ 6,380,906     $ 77,453,202             $ 102,759,290             $ 89,714,763               $ 66,714,763  

See Notes to unaudited Pro Forma Condensed Balance Sheet

12

 
NOTES TO UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
AS OF DECEMBER 31, 2007


The unaudited condensed pro forma balance sheet combines the balance sheets of Sricon, TBL and IGC as of December 31, 2007 assuming that the Acquisition had been completed as of December 31, 2007. The historical balance sheets used in the preparation of the pro forma financial statements have been derived from Sricon’s, TBL’s and IGC’s unaudited financial statements as of December 31, 2007. Pro forma adjustments are necessary to record the accounting for the Acquisition, including a preliminary allocation of purchase price to the estimated fair values of assets and liabilities acquired. No pro forma adjustments were required to conform Sricon’s or TBL’s accounting policies to IGC’s accounting policies. Descriptions of the adjustments included in the unaudited pro forma condensed balance sheet are as follows:

(a)
 
(i) Reflects the release of IGC’s restricted cash held in trust to cash and cash equivalents as a result of the acquisition for the payment of the purchase prices of Sricon and TBL as well as the payment of unpaid acquisition costs.

Amount released from escrow
  $ 66,938,208  
Described in Note b
  $ 35,750,000  
$2,000,000 for the purchase of CPS from Odeon and $3,000,000 for the purchase of shares from the promoters of Sricon.
  $ 5,000,000  

(ii) Estimated total purchase price is derived as the payment of approximately $35,750,000 in cash.  We have a deposit with CWEL in the amount of $250,000.  The components of the purchase price for Sricon and TBL are summarized as follows:

   
Sricon
   
TBL
   
Total
 
New Equity Shares
  $ 25,750,000     $ 6,875,000     $ 32,625,000  
New Preference Shares
    -       3,125,000       3,125,000  
Equity Shares Purchased from existing shareholders
    3,000,000       -       3,000,000  
Preference Shares Purchased from existing shareholders
    -       2,000,000       2,000,000  
Allocation of estimated acquisition costs
    746,941       388,381       1,135,322  
                         
    $ 29,496,941     $ 12,388,381     $ 41,885,322  


Amount paid for the subscription of new equity shares
  $ 32,625,000  
Amount paid for new preference shares
  $ 3,125,000  
Total shown in Pro Forma
  $ 35,750,000  
 
 
13

 
In accordance with Statement of Financial Accounting Standards, or SFAS, No. 141 “Business Combination”, under the purchase method of accounting, the total estimated purchase price for each Sricon and TBL has been allocated to Sricon’s and TBL’s net tangible and intangible assets based on their estimated fair values as of the date of the consummation of the purchase. The estimated purchase price included on the accompanying unaudited pro forma condensed balance sheet is based on the preliminary allocation of purchase price to the estimated fair values of assets acquired and liabilities assumed, and is subject to material changes upon receipt of the final valuation as described in the introduction to these unaudited pro forma condensed financial statements.  The preliminary estimate of the purchase price allocation, including recognition of goodwill, is as follows:
 
 
     
Sricon
     
TBL
     
Total
 
Current assets
 
$
26,808,187
   
$
9,676,767
   
$
36,484,954
 
Property and equipment, net
   
3,527,302
     
1,618,904
     
5,146,206
 
Other non current assets
   
722,373
     
1,296,530
     
2,018,903
 
Goodwill
   
7,466,211
     
5,602,478
     
13,068,689
 
Short-term borrowings and current portion of long-term debt
   
(2,482,230
)
   
(3,184,012
   
(5,666,242
)
Other Current liabilities
   
(3,553,142
)
   
(1,384,885
)
   
(4,938,027
)
Long-term debt, net of current portion
   
(1,426,555
)
   
(587,374
)
   
(2,013,929
)
Other non-current liabilities
   
(1,565,205
)
   
(650,027
)
   
(2,215,232
)
Total
 
$
29,496,941
   
$
12,388,381
   
$
41,885,322
 
 
 
Goodwill is calculated as the difference between tangible and intangible net assets (liabilities) acquired and the estimated purchase price.   In accordance with Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets,” if the management of IGC determines that the value of goodwill or intangible assets with indefinite lives has become impaired, IGC will incur an accounting charge for the amount of impairment during the fiscal quarter in which the determination is made.

(iii) Reflects the elimination of deferred acquisition costs as of December 31, 2007

(iv) Reflects the elimination of each of Sricon’s, TBL’s, and IGC historical capital stock amounts, paid-in capital, treasury stock, accumulated deficits and other comprehensive income and the resulting adjustment to minority interest.  Minority interest is generated as IGC is purchasing 63% and 77% of Sricon and TBL respectively.

(v)  
After the consummation of the business transaction we will borrow up to an aggregate of $23 million from our subsidiaries Sricon and TBL.  The interest paid to our subsidiaries would be eliminated in the intercompany eliminations, except for the minority share.  We estimate using an annualized interest of 3%, the minority interest component that would not be eliminated to be about $230,000 for the period of one year.  This amount is not included in the Pro Forma.

(vi)  
As part of obtaining investors in the Bridge Loan we agreed to pay Ferris Baker, Watts and Maxim
Group a total of $300,000.  Of this amount, $150,000 is due upon a successful business combination.

(vii)  A total of $170,000 was expensed in the December quarter.  This amount reflects the differed acquisition cost related to the MBL transaction which the Company believes is improbable.

(viii) With respect to the Bridge loan we agreed to compensate the lenders with 550,000 shares of our common stock.  These shares are due at the closing of a successful business combination.  We estimated using the Black-Scholes model the value of these shares to be $3,267,000.
 
14

 
(b) This amount reflects the adjustment to the provision (benefit) for income taxes as a result of net operating losses generated for Federal and State income tax purposes on a combined basis.

(c)
i.
For December 31, 2007: The basic shares include shares sold in the IPO, founder’s shares and shares sold in the private placement and shares awarded to the Bridge Investors.   The fully diluted shares include basic shares plus the following: shares arising from the exercise of warrants sold as part of the units in the offering plus shares arising from the exercise of warrants issued to Oliveira Capital.   The UPO issued to the underwriters (1,500,000 shares) is not considered in this calculation as the strike price for the UPO is “out of the money” at $6.50 per share. The historical weighted average per share, for our shares, through December 31, 2007, was applied using the treasury method of calculating the fully diluted shares.   The calculation for fully diluted shares includes 2,905,608 shares and excludes 20,468,392 shares from the EPS computations.  In the event that there is maximum redemption, a total of 2,259,770 could potentially be redeemed.  The shares outstanding for the maximum redemption scenario are the shares in the case of no redemption less 2,259,770.  For the third case involving a share purchase from a limited number of our investors, the number of shares bought is calculated at a purchase price of $5.92 per share.
 
 
ii.
For FYE March 31, 2007: The basic shares include shares sold in the IPO, founder’s shares and shares sold in the private placement and shares awarded to the Bridge Investors.   The fully diluted shares include basic shares plus the following: shares arising from the exercise of warrants sold as part of the units in the offering plus shares arising from the exercise of warrants issued to Oliveira Capital.   The UPO issued to the underwriters (1,500,000 shares) is not considered in this calculation as the strike price for the UPO is “out of the money” at $6.50 per share. The historical weighted average per share, for our shares, through March 31, 2007 was applied using the treasury method of calculating fully diluted shares.   The calculation for fully diluted shares includes 2,972,025 shares and excludes 20,401,975 shares from the EPS computations. In the event that there is maximum redemption, a total of 2,259,770 could potentially be redeemed.  The shares outstanding for the maximum redemption scenario are the shares in the case of no redemption less 2,259,770.  For the third case involving a share purchase from a few of our investors, the number of shares bought is calculated at a purchase price of $5.92 per share.
 

(d) Reflects the repayment of notes payable to the founding stockholders inclusive of accrued interest.
 
(e) Reflects the repayment of notes payable to Oliveira Capital, LLC inclusive of accrued interest.
 
(f) Reflects the payment of deferred compensation due to the underwriters arising from the IPO.

(g) Reflects the payment of acquisition costs inclusive of payments to Ferris, Baker Watts, Inc. and SG Americas Securities, LLC., our underwriters.

(h)
(i) Assuming No Exercise of Redemption Rights
Reflects the transfer of common stock subject to possible conversion and deferred trust interest to common stock, additional paid in capital and retained earnings.

(ii) Assuming Maximum Exercise of Redemption Rights
Reflects the payment of common stock subject to possible conversion and deferred trust interest.


15


UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED DECEMBER 31, 2007

                     
Pro Forma
     
Consolidated
           
Consolidated
           
Consolidated
 
   
Sricon
   
TBL
   
IGC
   
Adjustments
     
Assuming No
           
Assuming
           
Assuming
 
                             
Exercise of
           
Maximum
           
Maximum
 
                             
Redemption
           
Exercise of
           
Buy Back of
 
                             
Rights
           
Redemption
           
Stock and
 
                                           
Rights
           
and Maximun
 
                                                         
Redemption
 
                                                             
Revenue
  $ 16,865,236     $ 5,041,565     $ -             $ 21,906,801             $ 21,906,801             $ 21,906,801  
Cost of revenue
    (10,793,156 )     (3,803,513 )     -               (14,596,669 )             (14,596,669 )             (14,596,669 )
                                                                         
Gross profit
    6,072,080       1,238,052       -               7,310,132               7,310,132               7,310,132  
                                                                         
Selling, general and administrative expenses
    (2,166,116 )     (139,719 )     -               (2,305,835 )             (2,305,835 )             (2,305,835 )
Depreciation
    (335,468 )     (356,357 )     -               (691,825