EXHIBIT 10.14
LOAN AGREEMENT
No. LA-201003/01
This Agreement is made on this day 3rd October, 2000 by and between
IPG Photonics Corporation
A Delaware Corporation registered to do business in Massachusetts and whose
Registered Office is 000 Xxxx Xxxxxx, Xxxxxxxxxx XX 00000 X.X.X. hereinafter
referred to as the "LENDER",
And
NTO "IRE-XXXXX"
A Russian Society with a Limited Responsibility registered to do business in
Fryazino, Moscow Region and whose Registered Office is Vvedenskogo Sq. l,
Fryazino, 000000 Xxxxxx hereinafter referred to as the "BORROWER",
Whereas:
The BORROWER is a research & development and manufacturing company operating in
the field of fiber optics communications and laser technology incorporated under
Russian Law, and is willing to enter into long term co-operation with the LENDER
and its affiliates in accordance with but not limited to the Assignment and
Research and Development Agreement signed between the LENDER and the BORROWER on
the 30th August 2000 and any other agreements for the supply of products,
research and development, technical assistance, capital equipment and any other
services that the BORROWER and its affiliates might from time to time enter into
with the LENDER.
Whereas:
The LENDER is a laser and fiber-optic equipment manufacturing company
incorporated under the Laws of the State of Delaware, USA, and is willing to
enter into long term co-operation with the BORROWER in accordance with but not
limited to the Assignment and Research and Development Agreement signed between
the LENDER and the BORROWER on the 30th August 2000 and any other agreements for
the purchase of products, research and development, technical assistance,
capital equipment and other services that the BORROWER might from time to time
enter into with the LENDER and its affiliates.
NOW THEREFORE IT IS MUTUALLY AGREED AS FOLLOWS:
1. SUBJECT OF THIS AGREEMENT
1.1. The LENDER hereby agrees to advance to the BORROWER the sum of USD
1,000,000 (one million USD). The sum will be advanced to the BORROWER
in two equal installments each of USD 500,000 (USD five hundred
thousand) payable.
2. USE OF PROCEEDS
2.1. The proceeds of the loan are to be used to acquire machinery and
capital equipment to be used in research and development and the
supply of components, products and equipment to the IPG Group in
accordance with but not limited to the Assignment and Research and
Development Agreement signed between the IPG Group and the Borrower on
the 24th August 2000 and any other agreements that the IPG Group and
the Borrower might from time to time enter into.
3. TERMS OF PAYMENT
3.1. The payment of USD 1,000,000,- shall be made by the LENDER to the
BORROWER'S account as per the following telegraphic transfer
instructions:
Bankers Trust Company
New York, USA
SWIFT Code: XXXXXX00
Account No.: 00-000-000
Beneficiary: Federal Bank of Innovations and Development
Moscow, Russia
For final credit to Account No.: 4070284040000007007
Beneficiary: NTO "IRE-Xxxxx" Co
3.2. The loan shall be drawn down as follows:
500,000 USD amounting to 50% of the Loan
The LENDER shall transfer USD 500,000 (five hundred thousands USD) to
the BORROWER as per the payment instructions given above with value
date 5th October 2000.
500,000 USD amounting to 50% of the Loan
The LENDER shall transfer USD 500,000 (Five Hundreds Thousands USD) to
the BORROWER as per the payment instructions given above and as
mutually agreed but in any event not later than 15th January 2001. The
transfer is to be executed within 10 days of the BORROWER'S request
for funds.
4. TERMS AND CONDITIONS OF THE LOAN
4.1. The Loan is unsecured.
4.2. Interest shall accrue on the principal at 7.00% being the current
Federal Funds Rate of 6.50% plus a spread of 0.50%. This rate shall be
fixed for the term of the loan.
4.3. Interest shall be calculated on the date that the Loan falls due on
the basis of the number of days that loan has been drawn down in
proportion to 365.
4.4. Interest is payable in cash on the date that the Loan falls due.
5. REPAYMENT
5.1. The term of the loan is for six months from the date that the LENDER
transfers the funds to the BORROWER such period being determined from
the date on which the BORROWER draws down the first portion of the
loan.
5.2. BORROWER may repay any capital sum and interest accrued thereon up to
the date of repayment at any time before the expiry of the Loan
subject to informing the LENDER in writing such intention and any such
repayment of amounts due shall constitute the fulfillment of the
BORROWER'S obligations and the fulfillment of LENDER'S rights under
the agreement.
5.3. At the mutual agreement of both parties the loan may be converted into
authorized but Unissued Common Stock of the BORROWER at a rate to be
determined and agreed by the parties at the time of such conversion on
or before the due date of the loan.
5.4. The repayment of any capital or interest accrued thereon shall be made
by the BORROWER to the LENDER'S account as per the following transfer
instructions:
FirstMass Bank N.A.
000 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
Xxxxxx Xxxxxx of America
ABU Number: 211370545
Account No.: 8029308942
Beneficiary: IPG Phonics Corporation
5.5. To the extent that the LENDER owes the BORROWER any monies due under
any other agreement between the LENDER and the BORROWER, the BORROWER
may offset such amounts as are mutually agreed between the parties
against the principal of the Loan and accrued interest accrued thereon
by written notice to the LENDER to that effect.
6. DEFAULT PROVISIONS
6.1. Upon the occurrence of any of the following events, the entire unpaid
principal balance of this Loan, together with all accrued interest,
shall become immediately due and payable, and the LENDER shall be
entitled to pursue all remedies which it may have, at law or in
equity, for the enforcement and collection of the principal and
accrued interest:
6.1.1 The failure of the BORROWER to make any payment of interest or
principal when due on this Loan; or
6.1.2. Any other default by the BORROWER in the payment or performance
of its obligations under this Loan, if such default is not
fully remedied within ten days after notice of such default is
given to the BORROWER.
7. NOTICES
7.1. All notices, requests, demands or other communications to be given by
either party to the other pursuant to this Agreement shall be in
writing and in the English language and sent by telex, electronic
mail, cable or registered mail, postage prepaid to the addresses in
the introduction to this agreement.
8. VALIDITY OF THE CONTRACT
8.1. This Loan and all representations, warranties, covenants and
agreements contained herein, shall be binding upon the Borrower and
its successors and permitted assigns and shall inure to the benefit of
the LENDER and its successors, endorsees and assigns. The BORROWER may
not assign or delegate any of its duties and or obligations under this
Loan.
8.2. This Contract is valid for a period of six (6) months, such period
being determined from the date on which the first portion of the loan
is drawn down by the BORROWER and shall expire on the earlier of the
completion of the period detailed above or the date of repayment of
the Loan by the Borrower to the LENDER.
8.3. At the mutual agreement of both the LENDER and the BORROWER the term
of this agreement and the Loan governed hereunder may be extended from
time to time as is deemed appropriate.
8.4. This Loan Agreement and the rights and obligations hereunder shall be
governed by and construed in accordance with the laws of the State of
New York applicable to contracts entered into and be performed within
said State. This Contract has been drawn in two (2) English / Russian
Copies and has been duly signed by Parties concerned under the date
herein above stated.
FOR IPG Photonics Corporation
/s/ Dr. Xxxxxxx X.X. Xxxxxx
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FOR NTO IRE-Xxxxx:
/s/ Xx. Xxxxxxxx X. Xxxxxxxxx
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