Debenture Subscription Agreement
Exhibit 10.2
DEBENTURE SUBSCRIPTION AGREEMENT
THIS DEBENTURE SUBSCRIPTION AGREEMENT is made on this 2nd day of February 2007
BY AND AMONG:

1.   MBL INFRASTRUCTURES LIMITED, a company incorporated in India under the
Companies Act, 1956 and having its registered office at 23A, Netaji Subhash
Road, 3rd Floor, Suite No. 14, Kolkata — 700001 (hereinafter referred to as the
“Company”);   2.   THE PERSONS whose names and particulars are more particularly
set out in Schedule 1 hereto (hereinafter referred to collectively as
“Promoters” and each, a “Promoter”, which expression shall unless repugnant to
the context or meaning thereof, be deemed to mean and include their heirs, legal
representatives, executors, and administrators);   3.   INDIA GLOBALISATION
CAPITAL, INC. a company organised under the laws of the State of Maryland and
having its office address at 4336 Montgomery Avenue Bethesda, MD 20814
(hereinafter referred to as “Investor”, which expression shall, unless it be
repugnant to the context or meaning thereof, be deemed to mean and include its
successors and assigns).

WHEREAS:

A.   The Company is inter alia engaged in the business of execution of civil
engineering projects and specialises in road and highway projects (the
“Business”);   B.   The Promoters are the legal and beneficial owners of 95.92 %
of the total issued and paid up share capital of the Company and are presently
in control of the day to day management and operations of the Company;   C.  
The Company has, at the date of this Agreement, an authorised share capital of
INR 20,00,00,000 consisting of 2,00,00,000 equity shares of par value INR 10
each (each, an “Equity Share”). As of date 1,10,63,727 Equity Shares have been
issued and are held by the persons in the number and proportion as set out in
Schedule 2;   D.   The Investor has agreed to acquire (by itself or through its
Affiliates) through subscription and purchase of Equity Shares, upto 57% of the
total issued, subscribed and paid up share capital of the Company on a Fully
Diluted Basis on such terms and conditions, as contained in the SSPA;   E.  
Since the afore-recited subscription and purchase of Equity Shares is subject to
the Investor receiving its shareholder approval, the Promoters have requested
the Investor to make an interim investment of the Investment Amount for
subscribing to the Convertible Instruments of the Company;   F.   The Parties
are entering into this agreement to record the terms and conditions on which the
Investor shall subscribe to Convertible Instruments aggregating to the
Investment Amount. The subscription to the Convertible Instruments shall be in
accordance with the terms and

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Debenture Subscription Agreement

    subject to the conditions of this Agreement.

NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS, AGREEMENTS,
REPRESENTATIONS, WARRANTIES AND INDEMNITIES SET FORTH IN THIS AGREEMENT, AND FOR
OTHER GOOD AND VALUABLE CONSIDERATION, THE SUFFICIENCY OF WHICH IS HEREBY
ACKNOWLEDGED BY THE PARTIES, THE PARTIES HEREBY AGREE AS FOLLOWS:

1.   INTERPRETATION   1.1.   Definitions: In this Agreement, except to the
extent that the context requires otherwise the following terms shall have the
meanings set forth below, such meanings to be applicable to both the singular
and the plural forms of such terms:

  a)   “Act” means the Companies Act, 1956 and any amendment thereto or any
other succeeding enactment for the time being in force;     b)   “Affiliate” in
relation to the Investor means:

     (i) being a corporate entity, means any entity, which Controls, is
Controlled by, or is under the common Control of the Investor;
     (ii) being an individual, means any person who is Controlled by the
Investor or is a relative of such person;

  c)   “Agreement” or “the Agreement” or “this Agreement” shall mean this
Debenture Subscription Agreement, as from time to time amended, supplemented or
replaced or otherwise modified and any document which amends, supplements,
replaces or otherwise modifies this Agreement, together with the recitals and
all the Annexures, Appendices and Schedules attached hereto;     d)  
“Applicable Law” shall mean any Indian statute, law, ordinance, regulation,
rule, order, bye law, administrative interpretation, writ, injunction,
directive, judgment or decree or other instrument which has a force of law in
India applicable to any Party, as is in force from time to time;     e)  
“Board” means the Board of Directors of the Company;     f)   “Business” shall
have the meaning ascribed to it in Recital A;     g)   “Claim” includes any
notice, demand, assessment, letter or other document issued or action taken by
any tax, fiscal or other statutory or governmental authority, body or official
whatsoever (whether of India or elsewhere in the world) whereby the Company is
or may be placed or sought to be placed under a liability to make a payment or
deprived of any relief, allowance, credit or repayment otherwise available;    
h)   “Control” in relation to an entity, shall mean any of: (i) the legal or
beneficial

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Debenture Subscription Agreement
ownership directly or indirectly of more than 50 % of the voting securities of
such entity or; (ii) controlling the majority of the composition of the board of
directors or; (iii) power to direct the management or policies of such entity by
contract or otherwise. The terms “Controlling” and “Controlled” shall be
construed accordingly;

  i)   “Completion Date” means the date specified in Clause 3.1.4 hereof;     j)
  “Conditions” shall mean such conditions as specified in Clause 3.1 hereof;    
k)   “Conversion Rate” shall mean INR 118/- (Rupees One hundred and Eighteen
only), or such other rate as may be mutually agreed between the Parties, which
is the rate at which the Convertible Instruments and all accrued dividends
thereon, are to be converted into Equity Shares;     l)   “Convertible
Instruments” shall mean fully convertible debentures to be subscribed to by the
Investor at INR 118/- (Rupees One hundred and Eighteen only) per such
instrument, bearing an interest rate of 8% per annum, to be subscribed to by the
Investor and to be issued by the Company in accordance with this Agreement and
the terms contained in Schedule 3 hereto;     m)   “DRHP” shall mean the draft
red herring prospectus filed by the Company with Securities Exchange Board of
India, The Stock Exchange, Mumbai and the National Stock Exchange of India Ltd.
pursuant to its program for fund raising through Initial Public Offerings of
Equity Shares and initialed by the Parties for the purpose of identification;  
  n)   “Encumbrances” means any form of legal, equitable, or security interests,
including, but not limited to, any mortgage, assignment of receivables,
debenture, lien, charge, pledge, title retention, right to acquire, security
interest, hypothecation, options, rights of first refusal, any preference
arrangement (including title transfers and retention arrangements or otherwise)
and any other encumbrance or condition whatsoever or any other arrangements
having similar effect;     o)   “Equity Shares” has the meaning ascribed to it
in Recital C;     p)   “Fully Diluted” or “Fully Diluted Basis” means all the
Shares of the Company, including the Shares comprised in a proposed issue, the
Shares underlying all outstanding warrants, options, stock options granted or
reserved, and convertible debentures, preference shares and all such other
securities of the Company after adjustments for stock splits, bonus issues;    
q)   “INR” means the lawful currency of India;     r)   “Investment Amount”
means the maximum aggregate amount of approximately the INR equivalent of
US$3 million proposed to be invested by the Investor into the Company;     s)  
“IPO or Initial Public Offering” shall mean the initial public offering of
Equity Shares or other securities (including depository receipts) in a
recognized stock exchange in

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India or overseas and the consequent listing of the Equity Shares or other
securities on such recognized stock exchange in India or overseas;

  t)   “Liabilities” mean any and all current liabilities, obligations,
payables, forms of taxation whether of India or elsewhere in the world, past,
present and deferred (including, without limitation, income tax, stamp duty,
customs and other import or export duties) and all other statutory or
governmental impositions, duties and levies and all penalties, charges, costs
and interest relating to any Claim;     u)   “Memorandum” means the Memorandum
of Association of the Company;     v)   “Person” includes an individual, an
association, a corporation, a partnership, a joint venture, a trust, an
unincorporated organisation, a joint stock company or other entity or
organisation, including a government or political subdivision, or an agency or
instrumentality thereof and/or any other legal entity (in each case, whether or
not having separate legal personality);     w)   “Redeemable Preference Shares”
shall mean redeemable preference shares of the Company at INR 118/- (Rupees One
hundred and Eighteen only) per such instrument and bearing a preferential right
of dividend of 8% per annum to be issued by the Company in accordance with this
Agreement and the terms contained in Schedule 3 hereto;     x)  
“Representations and Warranties” means the representations and warranties
made/provided by the Warrantors to the Investor in this Agreement and in
Schedule 4 hereof;     y)   “Shares” means the Equity Shares and any other
Shares forming a part of the share capital of the Company and other instruments
convertible or exchangeable into Equity Shares;     z)   “SSPA” means the Share
Subscription cum Purchase Agreement executed between the Investor, the promoters
(as defined therein) and the Company, pursuant to which, the Investor has agreed
to acquire through subscription and purchase of Equity Shares, upto 57% of the
total issued, subscribed and paid up share capital of the Company on a Fully
Diluted Basis on such terms and conditions, as contained therein;     aa)  
“Warrantors” means the Company and the Promoters, and “Warrantor” means any one
of them.

1.2.   The terms referred to in this Agreement shall, unless defined otherwise
or inconsistent with the context or meaning thereof, bear the meaning ascribed
to it under the relevant statute/legislation.   1.3.   All references in this
Agreement to statutory provisions shall be construed as meaning and including
references to:

  a)   Any statutory modification, consolidation or re-enactment (whether before
or after

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Debenture Subscription Agreement
the date of this Agreement) for the time being in force;

  b)   All statutory instruments or orders made pursuant to a statutory
provision; and     c)   Any statutory provisions of which these statutory
provisions are a consolidation, re-enactment or modification.

1.4.   Words denoting the singular shall include the plural and words denoting
any gender shall include all genders.   1.5.   Headings to clauses, sub-clauses
and paragraphs are for information only and shall not form part of the operative
provisions of this Agreement or the Schedules and shall be ignored in construing
the same.   1.6.   References to recitals, clauses or schedules are, unless the
context otherwise requires, are references to recitals, to clauses of or
schedules to this Agreement.   1.7.   Reference to days, months and years are to
Gregorian days, months and calendar years respectively.   1.8.   Reference to
“Investor”, unless repugnant to the context shall for the purpose of this
Agreement, mean and include the Affiliates of the Investor.   1.9.   Any
reference to the words “hereof,” “herein”, “hereto” and “hereunder” and words of
similar import when used in this Agreement shall refer to clauses or annexures
of this Agreement as specified therein.   1.10   The words ‘include’ and
‘including’ are to be construed without limitation.   2.   SUBSCRIPTION ON
COMPLETION DATE   2.1.   Subscription of the Convertible Instruments: Subject to
the terms of this Agreement and relying on the Representations and Warranties
and the indemnities given by the Promoters and the Company under this Agreement,
the Investor agrees on the Completion Date to subscribe for and the Company
agrees to allot and issue to the Investor, such number of Convertible
Instruments aggregating to the Investment Amount.   2.2.   Terms of Issue: Each
Convertible Instrument shall be allotted and issued free of all Encumbrances.  
3.   CONDITIONS PRECEDENT   3.1.   The obligation of the Investor to subscribe
to the Convertible Instruments is conditional upon the fulfillment of the
following conditions to the satisfaction of the Investor:

  3.1.1.   the Parties complying with all legal formalities and obtaining all
statutory consents and approvals required or desirable under any and all
Applicable Laws and regulations or agreements entered into by the Company for
the subscription, issue and allotment of Convertible Instruments pursuant to the
terms of this Agreement;

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Debenture Subscription Agreement

  3.1.2.   execution of the SSPA.     3.1.3.   The Promoters and the Company
shall co-operate and provide all information and assistance to the Investor
and/or its advisors and authorised representatives to enable them to verify the
documents provided by the Company pursuant to Clause 3.1.1 of this Agreement.  
  3.1.4.   Within 7 days of fulfillment of all the Conditions, the Investor
shall subscribe to such number of Convertible Instruments aggregating to the
Investment Amount. The date so indicated by the Investor shall be referred to as
“Completion Date”.

3.2.   Waiver: The Investor may waive all or any of the Conditions at any time
by notice in writing to the Company, subject to such conditions which the
Investor may deem fit.   3.3.   Obligations of the Company and the Promoters:

  3.3.1.   The Company and the Promoters shall use their respective best
endeavors to ensure that the Conditions are fulfilled as soon as possible, but
in no event later than 5 days from the date of execution of this Agreement or
such other date as may be notified by the Investor in writing to the Company.  
  3.3.2.   If at any time, the Company or a Promoter becomes aware of a fact or
circumstance that might prevent any of the Conditions from being satisfied, it
shall immediately inform the Investor in writing of the same. In such an event
the Parties shall co-operate with each other in good faith to resolve any issues
which may arise.

4.   CLOSING   4.1.   Venue and Time of Closing: The closing shall take place at
the time indicated by the Investor on the Completion Date at Kolkata and time as
shall be agreed by the Parties.   4.2.   The Obligations of the Company and the
Promoters at Closing:

  4.2.1.   On the Completion Date, the Company shall deliver or cause to be
delivered to the Investor, (i) original resignation letter of Mr. S. P.
Mukherjee resigning as the director of the Company, dated as of the Completion
Date or an date earlier to the Completion Date but after the date of this
Agreement, and (ii) a written confirmation from the Company and each of the
Promoters that as at the Completion Date:

  •   no event has occurred which has or may have a material adverse effect on
the Business, operations, financial condition or prospects of the Company; and  
  •   the Representations and Warranties are true, accurate and complete and
that it is not aware of any matter or thing which is in breach of or
inconsistent with any of the Representations and Warranties.

  4.2.2.   Each of the Promoters shall on the Completion Date also deliver all
the documents specified in Clause Error! Reference source not found. of
Schedule 3 hereof to the

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Debenture Subscription Agreement

      Investor or any Person nominated by the Investor.     4.2.3.  
Simultaneously against receipt of the Investment Amount, the Promoters and the
Company shall ensure that a meeting of the Board is held at which, the Board
shall pass resolutions approving and accepting:

  (a)   the issue and allotment to the Investor, of such number of Convertible
Instruments aggregating to the Investment Amount, with specific reference to the
distinctive number of the Convertible Instruments and the corresponding
certificates;     (b)   the draft amendments to the Articles of Association of
the Company to incorporate the provisions of Clause 7 of this Agreement;     (c)
  the resignation of Mr. S. P. Mukherjee from the Board and approving
appointment of one director, as specified by the Investor on the Board and
acknowledging that such director has been appointed pursuant to Section 255(2)
of the Act; and     (d)   convening an extra-ordinary general meeting of the
Company in accordance with the Articles of Association of the Company to amend
the Articles of Association of the Company to incorporate the draft amendments
finalized by the Board under Clause 4.2.3(b) above.

  4.2.4.   Immediately thereafter the Company shall (i) issue and deliver to the
authorized representative of the Investor the original debenture certificates
duly stamped, signed and sealed for the Convertible Instruments subscribed to by
the Investor; and (ii) incorporate the name of the Investor as the legal and
beneficial owners of the Convertible Instruments in the register of debenture
holders of the Company.     4.2.5.   Each of the Promoters and the Company
hereby grant their consent and no-objection to any future investments/joint
venture or technical/financial collaborations or any other collaborations by the
Investor and/or any of its Affiliates in business/entities engaged in
businesses, which are in the same or allied field (present or future) as the
Company and/or any of the Promoters and/or any of their respective affiliates.
Each of the Promoters and the Company undertake to and shall provide the
Investor on the Completion Date, a no objection certificate in the form annexed
as Schedule 5 hereof.     4.2.6.   Upon completion of the steps set out in
Clauses 4.2.1 to 4.2.5 above, the Company shall hold an extra-ordinary general
meeting of the Company to pass necessary resolutions for amending the Articles
of Associations of the Company, as per the draft amendments initialed and
finalized by the Board under Clause 4.2.3(b) above.

4.3.   The Obligations of the Investor at Closing:

  4.3.1.   On the Completion Date the Investor shall:     a)   deliver an
application in writing for such number of Convertible Instruments

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Debenture Subscription Agreement

      aggregating to the Investment Amount, to be subscribed by the Investor on
the Completion Date;     b)   appoint one person as a director on the Board; and
    c)   pay to the Company the Investment Amount by a cheque or bank draft made
in favour of the Company, or by way of telegraphic transfer, or such other means
as may be agreed with the Company.

4.4.   Notwithstanding anything contained in this Agreement, it is hereby agreed
to by and between the Parties that, the Investor shall be liable to subscribe to
the Convertible Instruments in accordance with this Agreement only if all the
Representations and Warranties continue to be true and correct as on the
Completion Date.   4.5.   Investor’s Remedy:

  4.5.1.   If after having received the Investment amount from the Investor
pursuant to Clause 4.3.1 above, if the provisions of Clause 4.2 above are not
complied with by the Company and/or the Promoters on the Completion Date, the
Investor shall have the right to obligate the Company and if so required by the
Investor, the Company shall forthwith refund to the Investor the Investment
Amounts received from the Investor pursuant to Clause 4.3.1 above together with
interest thereon calculated at the rate of 21 % per annum from the date the
Investor paid the Investment Amount to the date of actual refund by the Company
with interest (‘Liquidated Damages’).     4.5.2.   The Parties agree and
acknowledge that the Liquidated Damages is a genuine pre estimate of the loss
that may be suffered by the Investor as a result of non-compliance by the
Company and/or the Promoters of the obligations specified in this Agreement.

5.   REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS   5.1.   True and Accurate:
The Warrantors represent, warrant and undertake to the Investor, that each of
the statements set out in this Clause and Schedule 4 hereof, as applicable to
the Warrantors, is now and will be true and accurate at the Completion Date. The
Warrantors acknowledge that the Investor, in entering into this Agreement, is
relying on such representations, warranties and undertakings and shall be
entitled to treat the same as conditions of the Agreement.   5.2.   Investor
Representation: The Investor hereby represents and warrants that it has the
corporate power and authority to execute, deliver and perform this Agreement and
the transactions contemplated herein. The execution, delivery and performance by
the Investor of this Agreement has been duly authorized and approved by its
board of directors.   5.3.   Separate and Independent: Each of the
Representations and Warranties shall be separate and independent and, save as
expressly provided to the contrary, shall not be limited by reference to or
inference from any other Representations and Warranty or any other term of this
Agreement, which is not expressly referenced to the Representations and Warranty
concerned.

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Debenture Subscription Agreement

5.4.   Knowledge: If any Representation or Warranty is qualified by knowledge,
then it means that the Representation or Warranty has been made to the best
knowledge of the Warrantors, after the Warrantors have made and caused to be
made such due and proper inquiries as may be required in respect of the relevant
matter to obtain informed knowledge.   5.5.   Undertaking: None of the
Warrantors shall do, allow or procure any act or omission before the Completion
Date which would respectively constitute a breach of any of the Representations
and Warranties if they were given at the Completion Date, or which would make
any of the Representations and Warranties inaccurate or misleading if they were
so given.   5.6.   Notification of breach: Each of the Warrantors hereby agree
to disclose promptly to the Investor in writing immediately upon becoming aware
of the same, any matter, event or circumstance (including any omission to act)
which may arise or become known to it after the date of this Agreement which:

  5.6.1.   would render any of the Representations and Warranties to be
inaccurate; or     5.6.2.   has, or is likely to have, a material adverse effect
on the financial position or prospects of the Company.

5.7.   Use of Subscription Proceeds: The Company and the Promoters undertake
that the proceeds from the issue of the Convertible Instruments, shall be
utilized and applied by the Company solely for the purposes of enhancing and
promoting the Business of the Company, save as otherwise expressly and
specifically agreed in writing by the Investor at their sole and absolute
discretion.   5.8.   Survival: The Representations and Warranties provided in
this Agreement shall survive the Completion Date.

6.   INDEMNITY   6.1.   Without prejudice to any other right available to the
Investor in law or under equity, the Company and the Promoters shall jointly and
severally indemnify, defend and hold harmless the Investor, their Affiliates,
directors, officers, employees and agents, and where the Investor so elects, the
Promoters shall jointly and severally indemnify, defend and hold harmless the
Company, its Affiliates, directors, officers, employees and agents from and
against any and all liabilities, damages, demands, Claims (including third party
Claims), actions, judgments or causes of action, assessments, interest, fines,
penalties, and other costs or expenses (including, without limitation, amounts
paid in settlement, court costs and all reasonable attorneys’ fees and out of
pocket expenses) directly based upon, arising out of, or in relation to or
otherwise in respect of:

  i.   any inaccuracy in or any breach of any Representation and Warranty,
covenant or agreement of the Promoters or the Company contained in this
Agreement or any document or other papers delivered by any of them to the
Investor in connection with or pursuant to this Agreement;

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Debenture Subscription Agreement

  ii.   any liability arising out of non compliance of any obligation undertaken
by the Company or the Promoters, save and except those already provided in the
audited financial statements of the Company or disclosed in the DRHP;     iii.  
any liabilities and obligations of whatever nature relating to any litigation,
Claim or governmental investigation pending or relating to the business or
operations of the Promoters or the Business of the Company prior to the date of
execution of this Agreement and as on the Completion Date, save and except those
already provided in the audited financial statements of the Company or disclosed
in the DRHP;     iv.   any liability due to any non-compliance of any Applicable
Law, rules or regulations prior to the date of execution of this Agreement and
as on the Completion Date, save and except those already provided in the audited
financial statements of the Company or disclosed in the DRHP;     v.   any
liability arising from the non-compliance of any statutory requirements in
connection with the issuance and registration of the Convertible Instruments
pursuant to the terms of this Agreement.

6.2.   Any compensation or indemnity as referred to in Clause 6.1 above shall be
such as to place the Investor in the same position as it would have been in, had
there not been any such breach and as if the Representation and Warranty under
which Investor is to be indemnified, had been correct.   7.   BOARD
REPRESENTATION   7.1.   The Parties agree and acknowledge that the Investor
shall be entitled to appoint one director on the Board and that such director
shall be appointed under Section 255(2) of the Act. Such director shall resign
on the Completion Date as defined in Clause 5.3 of the SSPA or by 30th
September 2007 or on redemption of the Redeemable Preference Shares, whichever
is latest. Such date may be modified by mutual consent of the Parties.   7.2.  
On the Completion Date, the composition of the Board shall be changed forthwith
and the Promoters shall co-operate and cause its nominee directors to resign
from the Board or shall remove such nominee directors from the Board so as to
enable the Investor to have one director on the Board.   7.3.   The right of
nomination and appointment of the directors conferred on the Investor under
Clause 7.1 shall include the right at any time to remove from office any such
persons nominated or appointed by them and from time to time determine the
period for which such persons shall hold office as Director. If the Investor
desires that any of the directors nominated or appointed by it should cease to
be a director of the Company, the Promoters shall cause, and shall exercise its
voting rights in such manner, so as to ensure such removal and appointment of
new director nominated by the Investor to replace the director so removed as
soon as may be practicable.   7.4.   All questions arising at the meetings or
the adjourned meetings of the Board shall be decided by a majority of votes of
the directors present and entitled to vote. However, no resolution shall be
passed or decision be taken by the Board at a meeting of the Board, or by
circulation

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Debenture Subscription Agreement

      in respect of any of the following matters unless an affirmative vote of
the director appointed/nominated by the Investor is obtained for it to be
validly passed or taken. It is clarified for the avoidance of doubt that the
Board shall not be entitled to pass a resolution on any of the following matters
if the director appointed/nominated by the Investor is not present at such
meeting of the Board:

  7.4.1.   entering into a scheme of reconstruction (including a demerger of any
division) or entering into a scheme of arrangement with creditors or
shareholders, or passing any resolution for its winding up or undertaking any
liquidation exercise or applying for the appointment of a receiver, manager,
judicial manager or like officer;     7.4.2.   creation, allotment, issue,
acquisition, reduction, repayment, conversion or redemption of any Share or loan
capital (except those in the ordinary course of business) or of any instrument
convertible into Shares; or any entering into an agreement, arrangement or
undertaking to do any of those things, or any action which alters the share
capital of the Company or the variation of rights of any Shares of the Company;
    7.4.3.   any amendment to the Memorandum or Articles of Association of the
Company which affects the Investor’s interests;     7.4.4.   any action leading
to the entering in to any listing agreement with any stock exchange, offering
Shares to QIBs, FIs or the Public or listing any IPO;

7.5.   In the event the Investor or any of its Affiliates cease to (i) be
shareholders of the Company; or (ii) hold any Convertible Instruments, then all
the rights of the Investor under this Clause shall automatically terminate and
the Investor shall cause his nominee director to resign from the Board.   8.  
CO-OPERATION       The Parties shall use their reasonable efforts to ensure that
the transactions contemplated by this Agreement are consummated as per the terms
hereof, including without limitation, obtaining all approvals from the
applicable government and/or regulatory authorities and other Persons as may be
necessary or reasonably requested by the Investor in order to consummate the
transactions contemplated by this Agreement.   9.   RESOLUTION OF DISPUTES  
9.1.   Amicable Settlement       If any dispute arises between the Investor
and/or the Promoters and/or the Company during the subsistence of this Agreement
or thereafter, in connection with the validity, interpretation, implementation
or alleged breach of any provision of this Agreement (“Dispute”), the disputing
Parties hereto shall endeavour to settle such Dispute amicably. The attempt to
bring about an amicable settlement shall be considered to have failed if not
resolved within 60 days from the date of the Dispute.   9.2.   Conciliation

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Debenture Subscription Agreement

    If the Parties are unable to amicably settle the Dispute in accordance with
Clause 9.1 within the period specified therein, the Parties shall forthwith but
not later than 30 days after expiry of the aforesaid period, refer the Dispute
to Mr. Ram Mukunda and Mr. Ram Gopal Maheshwari for resolution of the said
Dispute. The attempt to bring about such resolution shall be considered to have
failed if not resolved within 30 days from the date of receipt of a written
notification in this regard.   9.3.   Arbitration

  (i)   In the event the Dispute is not settled in accordance with Clause 9.2
above, any Party to the Dispute shall be entitled to serve a notice invoking
this Clause and making a reference to an arbitration panel of three arbitrators.
Each Party to the dispute shall appoint one arbitrator within 30 days of receipt
of the notice of the Party making the reference, and the two arbitrators so
appointed shall appoint a third arbitrator. The decision of the arbitration
panel shall be binding on all the Parties to the Dispute.     (ii)   The place
of the arbitration shall be Kolkata. (iii) The Arbitration proceedings shall be
governed by the laws of India. (iv) The proceedings of arbitration shall be in
the English language.     (v)   The Arbitrator’s award shall be substantiated in
writing. The court of arbitration shall also decide on the costs of the
arbitration proceedings. In case the arbitrators have not decided on the costs
of the arbitration proceedings, each Party to the Dispute shall bear its own
costs, in relation to the arbitration proceedings.     (vi)   The award shall be
binding on the Parties subject to the Applicable Laws in force and the award
shall be enforceable in any competent court of law.     (vii)   It is mutually
agreed by both the Parties that Indian courts shall have exclusive jurisdiction.

10.   NOTICES   10.1.   Any notice or other communication that may be given by
one Party to the other shall always be in writing and shall be served either by
(i) hand delivery duly acknowledged; or (ii) sent by registered post with
acknowledgment due; or (iii) by facsimile at the respective addresses set out
herein below or at such other address as may be subsequently intimated by one
Party to the other in writing as set out herein. If the notice is sent by
facsimile, the said notice shall also be sent by registered post acknowledgment
due.

         
 
  The Investor:   Ram Mukunda
 
  Address:   At the address mentioned above
 
  Tel:   +1 301 529 4996
 
  Facsimile:   + 1 240 465 0273
 
       
 
  The Company:   Ram Gopal Maheshwari

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Debenture Subscription Agreement

         
 
  Address:   At the address above
 
  Tel:   +91 33 2230 2353/9517
 
  Facsimile:   +91 33 2230 8807
 
       
 
  The Promoters:   A.K. Lakhotia
 
  Address:   As mentioned specified in Schedule 1 hereof
 
  Tel:   +91 33 2230 2353/9517
 
  Facsimile:   +91 33 2230 8807

10.2.   All notices shall be deemed to have been validly given on (i) the
business date immediately after the date of transmission with confirmed answer
back, if transmitted by facsimile transmission, or (ii) the business date of
receipt, if sent by courier or hand delivery; or (iii) the expiry of seven days
after posting, if sent by registered post.   10.3.   Any Party may, from time to
time, change its address or representative for receipt of notices provided for
in this Agreement by giving to the other Party not less than 7 days prior
written notice.   11.   TERM AND TERMINATION   11.1.   This Agreement shall come
into effect and force and be binding on the Parties from the date first written
above and shall remain in full force unless terminated in accordance with the
provisions of this Agreement.   11.2   This Agreement may be terminated at any
time by mutual written agreement of the Parties.   11.3   At the option of the
Investor, this Agreement shall stand terminated if the Closing does not take
place as per Clause 4 of this Agreement.   11.4   However, within 15 days of
signing the SSPA and handing over the requisite shareholder and board
resolutions enabling the issuance and registration of Convertible Instruments
pursuant to the terms of this Agreement, or any mutual extension thereof; if the
Investment Amount is not paid to the Company by a cheque or bank draft made in
favour of the Company, or by way of telegraphic transfer, or such other means as
may be agreed with the Company, this Agreement shall stand terminated.   12.  
CONFIDENTIALITY   12.1.   The Parties recognise that each of them will be given
and have access to confidential and proprietary information of the other
Parties. The Parties undertake not to use any of such confidential information
for their own corporate purposes without the prior written consent of the Party
owning such information and shall keep confidential and not to disclose to any
third party any of the other Parties’ confidential and proprietary information.
The Parties shall also cause their respective directors, employees, officers and
any other persons to whom the above mentioned information is disclosed to
execute a letter of confidentiality to the effect provided in this Clause. The
obligations of confidentiality shall not apply to any information that:

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  (a)   was developed independently by the Parties;     (b)   was known to the
Party prior to its disclosure by the disclosing Party;     (c)   has become
generally available to the public (other than by virtue of its disclosure by the
receiving Party);     (d)   may be required in any report, statement or test the
Company submitted to any governmental or regulatory body;     (e)   may be
required in response to any summons or subpoena or in connection with any
litigation; or     (f)   may be required to comply with any law, order,
regulation or ruling applicable to any Party hereto     Provided that prior to
any disclosure in respect of a request to disclose confidential information
under subsections (d), (e) and (f), above a Party must first notify the Party
owning such confidential information, who shall then have the opportunity to
respond to and/or dispute such request. The provisions of this Clause shall
survive the termination of this Agreement.

12.2.   Upon termination of this Agreement, the Parties shall cause the Company
to either i) return to the Investor and Promoters, as applicable, and the
Parties shall return to each other, all documents and information belonging to
such Person and all copies thereof in the possession or under the control of a
Party which does not own such property, and all confidential information in
whatever media; or (ii) destroy all documents and information belonging to the
other Party and all copies thereof in the possession or under the control of a
Party .   12.3.   The Parties acknowledge and agree that the covenants and
obligations with respect to confidentiality set forth in this Clause relate to
special, unique and extraordinary matters, and that a violation of any of the
terms of such covenants and obligations will cause the Company and the owner of
such property irreparable injury for which adequate remedies are not available
at law. Therefore, the Parties agree that the Party entitled to enforce the
covenants set forth above, shall be entitled to an injunction, restraining order
or such other equitable relief as a court of competent jurisdiction may deem
necessary or appropriate to restrain the other Party from committing any
violation of the covenants and obligations contained in this Clause. These
injunctive remedies are cumulative and are in addition to any other rights and
remedies the concerned Party may have at law or in equity.   13.   AUTHORISED
PERSON       For the purposes of this Agreement, the Promoters shall be
represented by Mr. Anjanee Kumar Lakhotia. Accordingly, all the Promoters hereby
authorise Mr. Anjanee Kumar Lakhotia to represent the Promoters and take any
decision which may be required to be taken, do all acts and execute all
documents which are or may be required by the Promoters for the proper and
effective fulfillment of the rights and obligations under this Agreement. Any
action taken or deed performed or document executed by Mr. Anjanee Kumar
Lakhotia shall be deemed to be acts or deeds done or documents executed by all
the Promoters, and shall be

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    binding on all the Promoters.   14.   FUTURE INVESTMENT       In the event
the Condition Precedent referred to Clause 4.1.2 of the SSPA is not satisfied on
or prior to April 30, 2007, the Investor shall be obliged at the option of the
Company and the Promoters to invest an additional amount of approximately the
INR equivalent of US$3 million into the Company by subscription to further
allotment of Convertible Instruments to the Investor as per the terms of this
Agreement. Such date may only be extendable by mutual consent. If such
additional amount is not paid by April 30, 2007 or any extension thereof, the
SSPA shall stand terminated.   15.   MISCELLANEOUS PROVISIONS   15.1.  
Reservation of Rights       The rights which each Party has under this Agreement
shall not be affected, diminished or prejudiced or restricted by any
forbearance, indulgence or relaxation or inaction by the other Party at any time
to require performance of any of the provisions of this Agreement. No waiver or
acquiescence by any Party of any breach of any of the provisions of this
Agreement shall not be construed as a waiver or acquiescence of any continuing
or succeeding breach of such provisions, a waiver of any right under or arising
out of this Agreement or acquiescence to or recognition of rights other than
that expressly stipulated in this Agreement.   15.2.   Cumulative Rights      
All remedies of either Party under this Agreement whether provided herein or
conferred by statute, civil law, common law, custom or trade usage, are
cumulative and not alternative and may be enforced successively or concurrently.
  15.3.   Partial Invalidity       If any provision of this Agreement or the
application thereof to any Person or circumstance shall be invalid or
unenforceable to any extent, the remainder of this Agreement and the application
of such provision to persons or circumstances other than those as to which it is
held invalid or unenforceable shall not be affected thereby, and each provision
of this Agreement shall be valid and enforceable to the fullest extent permitted
by law. Any invalid or unenforceable provision of this Agreement shall be
replaced with a provision, which is valid and enforceable and most nearly
reflects the original intent of the unenforceable provision. Provided however,
if said provision is fundamental provision of this Agreement or forms part of
the consideration or object of this Agreement, the provision of this Clause
shall not apply.   15.4.   Amendments       No modification or amendment of this
Agreement and no waiver of any of the terms or conditions hereof shall be valid
or binding unless made in writing and duly executed by all the Parties.

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Debenture Subscription Agreement

15.5.   Assignment       Save and except as provided hereunder, this Agreement
and the rights and liabilities hereunder shall bind and inure to the benefit of
the respective successors of the Parties hereto, but no Party hereto shall
assign or transfer any of its rights and liabilities hereunder to any other
Person without the prior written consent of the other Parties. Notwithstanding
anything to the contrary contained above, the Investor shall be entitled to
assign its rights and/or obligations hereunder to any of its lenders or to any
of its Affiliates or to its holding company or to its ultimate parent company,
without the consent of the other Parties. The Parties shall mutually work
together within the framework of the law.   15.6.   Entire Agreement       This
Agreement constitutes the entire Agreement between the Parties with respect to
the subscription of the Convertible Instruments and supersedes and cancels any
prior oral or written agreement, representation, understanding, arrangement,
communication or expression of intent relating to the subject matter of this
Agreement.   15.7.   Relationship       None of the provisions of this Agreement
shall be deemed to constitute a partnership between the Parties hereto and no
Party shall have any authority to bind the other Party otherwise than under this
Agreement or shall be deemed to be the agent of the other in any way.   15.8.  
Governing law This Agreement shall be governed and construed in accordance with
the laws of India.   15.9.   Costs       Each Party shall bear its own expenses
incurred in preparing this Agreement. The Company shall pay the stamp duty and
other costs in respect of this Agreement and the issue and allotment of the
Convertible Instruments to the Investor.   15.10.   Force Majeure       No Party
shall be liable to the other if, and to the extent, that the performance or
delay in performance of any of its obligations under this Agreement is
prevented, restricted, delayed or interfered with due to circumstances beyond
the reasonable control of such Party, including but not limited to, Government
legislations, fires, floods, explosions, epidemics, accidents, acts of God,
wars, riots, strikes, lockouts, or other concerted acts of workmen, acts of
Government and/or shortages of materials. The Party claiming an event of force
majeure shall promptly notify the other Parties in writing, and provide full
particulars of the cause or event and the date of first occurrence thereof, as
soon as possible after the event and also keep the other Parties informed of any
further developments. The Party so affected shall use its best efforts to remove
the cause of non-performance, and the Parties shall resume performance hereunder
with the utmost dispatch when such cause is removed.

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Debenture Subscription Agreement

15.11.   Public announcements       Neither the Investor nor the Promoters nor
the Company shall make any disclosure or announcements about the subject matter
of this Agreement to any Person without the prior written consent of the other
Party except to the Board or the members of the Investor or the Company or for
the purpose of fulfilling its statutory obligations.   15.12.   Execution in
Counterparts       This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original and all of which, taken together,
shall constitute one and the same instrument.   15.13.   Authorization       The
persons signing this Agreement on behalf of the Parties represent and covenant
that they have the authority to so sign and execute this document on behalf of
the Parties for whom they are signing.

[EXECUTION PAGE FOLLOWS]

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Debenture Subscription Agreement
IN WITNESS WHEREOF THE PARTIES HERETO HAVE SET AND SUBSCRIBED THEIR RESPECTIVE
HANDS TO THESE PRESENTS ON THE DAY, MONTH AND YEAR HEREIN WRITTEN:

             
SIGNED AND DELIVERED   /s/ Parveen Mukunda
    )      
BY THE WITHINNAMED “ INVESTOR ”
    )      
PARVEEN MUKUNDA
    )      
 
    )      
 
           
ON THE 2nd DAY OF FEBRUARY 2007
    )      
 
           
IN THE PRESENCE OF:
    )      
WITNESS:
    )      
 
           
NAME AND ADDRESS:
    )      
 
           
SIGNED AND DELIVERED  /s/ Ram Gopal Maheshwari
    )      
BY THE WITHINNAMED “COMPANY”
    )      
BY THE HAND OF Mr.
    )      
(AUTHORISED SIGNATORY) PURSUANT TO THE
    )      
RESOLUTION PASSED BY THE BOARD
    )      
ON THE 2ND DAY OF FEBRUARY 2007
    )      
 
           
IN THE PRESENCE OF:
    )      
WITNESS:
    )      
 
           
NAME AND ADDRESS:
    )      
 
           
SIGNED AND DELIVERED  /s/ Anjanee Kumar Lakhotia
    )      
BY THE WITHINNAMED “Promoters”
    )      
 
    )      
 
    )      
 
           
ON THE 2ND DAY OF FEBRUARY 2007
    )      
 
           
IN THE PRESENCE OF:
    )      
WITNESS:
    )      
 
           
NAME AND ADDRESS:
    )      

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