Angel Deal syndicate seeks $20 Million from Indian EV charging company over Newchip warrant

The Austin-based investment group filed its complaint July 31 in the US District Court for the Western District of Texas, alleging Charge Zone failed to honor a warrant issued to Newchip in December 2021.

The warrant gave Newchip rights to invest in certain Charge Zone financing rounds, as well as access to financial statements, capitalization information and notices of future capital raises, according to Angel Deal Syndicate.

Newchip filed for bankruptcy in 2023, and its warrants were later treated as severable assets of the estate. Angel Deal Syndicate acquired the Charge Zone warrant from Newchip's Chapter 7 trustee through a court-approved auction in April 2024.

Angel Deal Syndicate alleges Charge Zone failed to provide financial records required under the warrant and completed multiple capital raises without giving the notices needed for the warrant holder to exercise its investment rights on agreed discounted terms.

Those alleged failures extended the warrant's enforcement period from two years to 10 years, through December 16, 2031, under the terms of the agreement, according to the complaint.

The investor is seeking specific performance requiring Charge Zone to honor the warrant's investment and information rights. Alternatively, it is seeking damages exceeding $20 million. The lawsuit also includes claims for fraudulent concealment and declaratory relief confirming that the warrant remains valid and enforceable.

Charge Zone, based in Vadodara, Gujarat, operates electric-vehicle charging infrastructure in India.

The dispute highlights the potential value of contractual and litigation-related assets acquired from bankruptcy estates. Angel Deal Syndicate's claim stems from rights purchased from Newchip's trustee rather than from an investment it originally made in Charge Zone, turning a warrant sold through a bankruptcy process into the basis for a potentially substantial enforcement claim.

Angel Deal Syndicate said the lawsuit is part of its effort to enforce investor rights and improve transparency around financing transactions. The group said additional documents and analysis relating to the dispute are expected to be released in the coming weeks.