Exhibit 10.2


 





 


Sauer-Danfoss Inc.

Loan Agreement

(US $ 25,000,000.00)


 


Loan
Agreement (the “Agreement”), dated as of 12th of March, 2009, between Danfoss A/S, a Danish
corporation (“Lender”) and Sauer-Danfoss Inc., a Delaware corporation (“Borrower”).


 


Whereas,
Borrower is an affiliate of Lender; and


 


Whereas,
Borrower desires to borrow and Lender is willing to lend US $ 25,000,000.00.


 


Now
Therefore, it is agreed as follows:


 


1.             Loan. Upon and subject to the terms and conditions
set forth in this Agreement, Lender agrees to lend and Borrower agrees to
borrow US $ 25,000,000.00 as a bullet loan evidenced by the attached Promissory
Note (the “Loan”).


 


2.             Interest Rate; Interest Calculation. (a) Except
as provided in 2(b) below, the interest rate is the aggregate of 3.98% per
annum “Interest Rate”). Interest shall be calculated on the actual number of
days elapsed on a 360 days year basis.


 


(b)           From and after an event of default
under this Agreement as described in paragraph 5 below, the Borrower shall pay
to the Lender interest on such amount from the due date until payment is
received by the Lender at a rate of 1% p.a. above the Interest Rate.


 


3.             Term; Payment Dates; Prepayments. (a) The
principal together with all unpaid accrued interest shall be repaid in full at
the 25th March,
2009.


 


(b)           Interest on the outstanding principle
amount of the Loan shall be payable on the last day of each calendar quarter or
if any such date is not a business day, then the next succeeding business day
(each an “Interest Payment Date”).


 


(c)           The outstanding principal amount of
the Loan may be prepaid in whole or in part without premium or penalty on any
Interest Payment Date; provided that any partial prepayments of the principal
amount shall be in minimum amounts of US $ 5,000,000.00 and in integral
multiples of US $ 1,000,000.00. Upon termination of the Agreement as provided
for in paragraph 5 below, the entire principal amount of the Loan outstanding
together with any accrued but unpaid interest shall be paid by Borrower to Lender.
Any extra cost for the lender by unwinding the funding shall be reimbursed by
the borrower.


 


4.             Payment. Payments of interest and principal shall be
made by wire transfer on each Interest Payment Date and on the final maturity
date, such dates being banking days in New York and Copenhagen, to account of
Lender, Account no. / Iban no. DK7430004454008669 at Danske Bank, Copenhagen,
Denmark (swift: DABADKKK), or as otherwise designated by written notification
by Lender.


 

















 


5.                                       Events of Default;
Termination. (a) Each of the
following shall be an event of default under this Agreement:


 


(i)                                     failure by Borrower to repay the entire
principal amount, or such lesser principal amount as Lender shall demand,
within five (5) business days of the date when such payment is due
hereunder; or


 


(ii)                                  failure by Borrower to pay interest on the
outstanding principle amount of the Loan within five (5) business days of
the date when such payment is due hereunder; or


 


(ii)                                  failure by Borrower to perform any other
material obligation of Borrower to Lender hereunder; or


 


(iv)                              Borrower shall execute an assignment for the
benefits of its creditors or resort to laws protecting insolvent companies.


 


(b)                                 In the event that Lender must employ
attorneys or file suit to collect hereunder, Borrower agrees to pay the
reasonable attorney fees and all court costs incurred by Lender.


 


6.                                       Assignment/Subrogation. Borrower shall not transfer or assign any or
all of its rights and obligations hereunder without the prior written consent
of Lender. Lender may, at any time, assign this Agreement and the Promissory
Note and its rights or obligations hereunder and thereunder in which case the
assignee shall be subrogated to the rights of Lender.


 


7.                                       Copies. This Agreement is made up in two (2) identical
copies of which one copy is for Lender and the other for Borrower.


 


8.                                       Notices. In the event that any written notice need be
given under this Agreement, it shall be given (a) by nationally recognized
over night carrier at the address of Borrower or Lender, as the case may be,
set forth below, or (b) by facsimile or e-mail as follows:


 


	
  (i)

  	
  To
  Borrower: 

  	
  250
  Parkway Drive, Suite 270

  
	
   

  	
   

  	
  Lincolnshire,
  Illinois 60069 USA

  
	
   

  	
   

  	
  Attention:
  Treasurer

  
	
   

  	
   

  	
  facsimile – +847-876-1799

  
	
   

  	
   

  	
  e-mail – ccohrs@sauer-danfoss.com

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
  To
  Lender:

  	
  Danfoss
  A/S

  
	
   

  	
   

  	
  Nordborgvej
  81

  
	
   

  	
   

  	
  DK-6430
  Nordborg

  
	
   

  	
   

  	
  Denmark

  
	
   

  	
   

  	
  Attention:
  Ole Albertsen

  
	
   

  	
   

  	
  E-mail:
  Albertsen@danfoss.com

  



 

















 


9.             Authority. Each Party represents that (a) it has
the legal capacity, corporate or otherwise, to enter into this Agreement and/or
the Promissory Note, as the case may be and (b) the execution and delivery
of this Agreement and the Promissory Note are not in violation of (i) applicable
laws, (ii) its certificate of incorporation, by-laws or other such
documentation or (iii) any other agreement by which it or its property is
bound.


 


10.           Applicable
Law. This
Agreement shall be governed by the laws of Denmark.


 


Agreed
upon as of the day first above written.


 


	
  Danfoss
  A/S

  	
   

  	
  Sauer-Danfoss
  Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Flemming Aaskov Jørgensen  

  	
   

  	
  By:

  	
  /s/ Karl Schmidt

  
	
  Name:

  	
  Flemming Aaskov Jørgensen

  	
   

  	
  Name:

  	
  Karl Schmidt

  
	
  Title:

  	
  Group
  Treasurer - Danfoss A/S

  	
   

  	
  Title:

  	
  Executive Vice President and Chief Financial Officer