EX-10.18 Loan Agreement, dated July 13, 2005

Contract Categories: Business Finance - Loan Agreements
EX-10.18 12 b65742amexv10w18.txt EX-10.18 LOAN AGREEMENT, DATED JULY 13, 2005 EXHIBIT 10.18 LOAN AGREEMENT between ALLEGRO MICROSYSTEMS, INC. and SANKEN ELECTRIC CO., LTD. Dated as of July 13, 2005 LOAN AGREEMENT Dated as of July 13, 2005 Allegro MicroSystems, Inc., a U.S. corporation ("AMI"), and Sanken Electric Co., Ltd., a Japanese corporation ("JSK"), hereby agrees as follows: 1. The Loan. Subject to the terms and conditions of this Agreement, JSK hereby lends to AMI, and AMI hereby borrows from JSK, US $8,000,000 on July 13, 2005 (the "Loan"). 2. Repayment of Loan. The Loan shall be repaid in half yearly installments according to the attached repayment schedule. JSK shall accept an early paying off the Loan by AMI anytime with no penalty. 3. Interest. Interest shall accrue on the unpaid principal balance as follows: The interest rate for the Loan is equal to the announced 3-month Tokyo Inter Bank Offered Rate (TIBOR) in Japan + 0.5% spread that is in effect on July 13, 2005. The rate shall be changed to new 3-month TIBOR + 0.5% spread every three months. 4. Payment of Interest. An accrued interest shall be paid on January 13 and July 13 every year, from January 13, 2006 to July 13, 2011. 5. Manner of Payment. Payments of principal and interest shall be made in an U.S. Dollar in immediately available funds. Payments shall be remitted to JSK's account #68910 at The Resona Bank, Ltd., Ikebukuro Branch. 6. Unsecured Loan. Any assets of AMI or other collateral do not secure this Loan. 7. No Separate Note. This Loan is not evidenced by a separate promissory note. This Agreement itself shall constitute evidence of indebtedness. 8. Acceleration. In the event that AMI should fail to make timely payments of principal or interest pursuant to this agreement, and such default is not cured within ten days, then, as JSK's option, JSK may declare the entire outstanding principal balance of the Loan to be immediately due and payable. 9. Governing Law. This Agreement shall be construed in accordance with the laws of the Commonwealth of Massachusetts. SANKEN ELECTRIC CO., LTD. Allegro MicroSystems, Inc. By: /s/ Akira Ota By: /s/ Mark A. Feragne --------------------------------- ------------------------------------ Akira Ota Mark A. Feragne Title : Corporate Officer, Financial Title: Chief Financial Officer Management Division Corporate Administration Headquarters REPAYMENT SCHEDULE
Date Payment Amount Remaining Balance - ---------------- -------------- ----------------- January 13, 2007 $800,000 $7,200,000 July 13, 2007 $800,000 $6,400,000 January 13, 2008 $800,000 $5,600,000 July 13, 2008 $800,000 $4,800,000 January 13, 2009 $800,000 $4,000,000 July 13, 2009 $800,000 $3,200,000 January 13, 2010 $800,000 $2,400,000 July 13, 2010 $800,000 $1,600,000 January 13, 2011 $800,000 $ 800,000 July 13, 2011 $800,000 $ 0
MEMORANDUM for LOAN AGREEMENT dated July 13, 2005 Dated as of June 30, 2006 With regard to the Loan Agreement entered into between Allegro MicroSystems, Inc. a U.S. corporation ("AMI"), and Sanken Electric Co., Ltd., a Japanese corporation ("JSK") on July 13, 2005, the parties hereby agree as follows: 1. AMI and JSK have agreed to change the interest rate on this loan for the remaining period. Consequently, Section 3 shall be changed from "The interest rate for the Loan is equal to the announced 3-month Tokyo Inter Bank Offered Rate (TIBOR) in Japan + 0.5% spread that is in effect on July 13, 2005. The rate shall be changed to new 3-month TIBOR + 0.5% spread every three months." to "The interest rate for the Loan is equal to the announced 3-month BBA LIBOR (London Inter Bank Offered Rate) + 0.45% spread. The interest rate shall be changed to new rate every three months. The interest rate for each period shall be determined by the following rule: Interest Rate from April 1 to June 30: 3-month BBA LIBOR on the last bank trading day in March + 0.45%. Interest Rate from July 1 to September 30: 3-month BBA LIBOR on the last bank trading day in June + 0.45%. Interest Rate from October 1 to December 31: 3-month BBA LIBOR on the last bank trading day in September + 0.45%. Interest Rate from January 1 to March 31: 3-month BBA LIBOR on the last bank trading day in December + 0.45%." 2. This Memorandum shall come into effect on July 1, 2006. SANKEN ELECTRIC CO., LTD. Allegro MicroSystems, Inc. By: /s/ Akira Ota By: /s/ Mark A. Feragne --------------------------------- ------------------------------------ Akira Ota Mark A. Feragne Title : Corporate Officer, Planning Title: Chief Financial Officer and Finance Division, Administration Headquarters