<PAGE>

                                                                    Exhibit 10.6

     THIS NOTE AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
     UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND
     NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION
     THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE
     REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL ACCEPTABLE
     TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES
     ACT OF 1933.

                      FORM OF SUBORDINATED PROMISSORY NOTE

$[__________]                                              [closing date of QPO]
Oxford, Massachusetts

FOR VALUE RECEIVED, IPG PHOTONICS CORPORATION, a Delaware corporation ("Maker"),
promises to pay to [SERIES B PREFERRED STOCKHOLDER] ("Holder"), the principal
sum of [__________] DOLLARS (US$[__________]); with interest from the date of
this Note on the unpaid principal amounts owing from time to time as provided
below. This Note is duly and validly issued and is subject to the following
terms and conditions:

1.   Maturity

(a) Principal plus all accrued but unpaid interest on the principal amount
outstanding shall be due and payable no later than the third anniversary date of
the date of original issuance of this Note (the "Maturity Date").

(b) This Note may be prepaid in whole or in part, without penalty, at the option
of Maker and without the consent of Holder; provided, however that any
prepayment be made pro rata among the Series B Notes (as defined in Section 7
below).

(c) All optional principal prepayments upon this Note shall be applied to the
payment of accrued and unpaid interest, and then against the principal amount.

2.   Interest

The outstanding principal owing from time to time hereunder will bear interest
at the rate of: (1) the greater of the Applicable Federal Rate for short term
obligations of three years or less and FOUR PERCENT per annum (compounded
annually) for the first one-year period that this Note is outstanding; (2) SEVEN
PERCENT per annum (compounded annually) for the second one-year period that this
Note is outstanding; and (3) TEN PERCENT per annum (compounded annually) for any
period after the second anniversary date of the date of original issuance of
this Note that this Note is outstanding until fully paid. Accrued but unpaid
interest shall be payable on the anniversary date of the issuance of this Note
and on the Maturity Day. Computations of interest shall be based on a year of
360 days but shall be calculated for the actual number of days in the period for
which interest is charged.

3.   Payments

Maker shall make payments in lawful money of the United States of America and in
immediately available funds. All payments under this Note shall be made

<PAGE>

to Holder at its address on the books and records of the Company or at such
other address as Holder shall direct Maker in writing.

4.   Breach of Covenants and Bankruptcy

The occurrence of any of the following shall constitute an "Event of Default"
hereunder:

(a)  Failure to Pay. Maker shall fail to pay (i) any principal payment on the
     Maturity Day hereunder or (ii) any interest payment required pursuant to
     the terms hereof on the date due and such failure is not cured within ten
     (10) days of the date such payment is due; or

(b)  Breaches of Covenants. Maker shall fail to observe or perform any covenant,
     obligation, condition or agreement contained herein, and such failure shall
     continue for ten days after Maker's receipt of Holder's written notice to
     the Maker of such failure;

(c)  Voluntary Bankruptcy or Insolvency Proceedings. Maker shall (i) apply for
     or consent to the appointment of a receiver, trustee, liquidator or
     custodian of itself or of all or a substantial part of its property; (ii)
     admit in writing its inability, to pay its debts generally as they mature;
     (iii) make a general assignment for the benefit of its or any of its
     creditors; (iv) be dissolved or liquidated in full or in part; or (iv)
     commence a voluntary case or other proceeding seeking liquidation,
     reorganization or other relief with respect to itself or its debts pursuant
     to any bankruptcy, insolvency or other similar law now or hereafter in
     effect or consent to any such relief or to the appointment of or taking
     possession of its property by any official in an involuntary case or other
     proceeding commenced against it; or

(d)  Involuntary Bankruptcy or Insolvency Proceedings. Proceedings for the
     appointment of a receiver, trustee, liquidator or custodian of the Maker or
     of all or a substantial part of the property thereof, or an involuntary
     case or other proceedings seeking liquidation, reorganization or other
     relief with respect to the Maker or the debts thereof pursuant to any
     bankruptcy, insolvency or other similar law now or hereafter in effect
     shall be commenced and an order for relief entered or such proceeding shall
     not be dismissed or discharged within ninety days of commencement.

5.   Rights of Holder upon Default

Upon the occurrence or existence of any Event of Default, and at any time
thereafter during the continuance of such Event of Default, Holder may, by
written notice to the Maker, declare all outstanding obligations payable by the
Maker hereunder to be immediately due and payable without presentment, demand,
protest or any other notice of any kind, all of which are hereby expressly
waived; except that upon the occurrence or existence of any Event of Default set
forth in Sections 4(c) or (d) herein, all of the outstanding obligations payable
by the Maker hereunder shall automatically become immediately due and payable
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived. No delay or omission by Holder in exercising
any right shall operate as a waiver of such right or any other right under this
Note; a waiver on any one occasion shall not be construed as a bar to or waiver
of any right on any future occasion. In addition to the foregoing remedies, upon
the occurrence or existence of any Event of Default, Holder may exercise any
other right, power or remedy granted to it hereunder or pursuant to applicable
law. The prevailing party


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<PAGE>

in any action (i) to collect payment on this Note, (ii) in connection with any
dispute that arises as to its enforcement, validity, or interpretation, whether
or not legal action is instituted or prosecuted to judgment, or (iii) to enforce
any judgment obtained in any related legal proceeding, shall be entitled to all
costs and expenses incurred, including attorney fees.

6.   Governing Law

This Note shall be governed by the laws of the State of New York, excluding its
conflict of law rules.

7.   Amendments and Waivers

This Note is one in a series of similar notes in the aggregate principal amount
of $20,000,000 issued by the Maker to holders of Series B Convertible
Participating Preferred Stock of Maker (the "Series B Notes") and any term of
this Note may be amended or waived with the written consent of the Maker and the
holders of a majority of the then outstanding aggregate principal amount of the
Series B Notes (the "Majority Interest"); provided, however, that any amendment
that adversely affects a holder of a Note in a manner different from the other
holders of Series B Notes shall require the prior written consent of such
holder. Any amendment or waiver effected in accordance with this Section 7 shall
be binding upon the Maker, the Holder and each transferee of the Note; however,
no such waiver shall affect or impair the rights of Holder to require
observance, performance, or satisfaction, either of that term or condition as it
applies on a subsequent occasion or of any other term or condition of this Note.
Notwithstanding the foregoing, Maker expressly agrees that this Note or any
payment under this Note may be extended by the Majority Interest in writing from
time to time without in any way affecting the liability of Maker.

8.   Transfer, Successors and Assigns

The terms and conditions of this Note shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties. Neither this
Note nor any of the rights, interests or obligations hereunder may be assigned,
by operation of law or otherwise, in whole or in part, by the Maker without the
prior written consent of Holder. This Note may not be sold or assigned by Holder
without prior written consent of Maker except in the event of a merger,
consolidation, or acquisition of Holder or any business unit thereof and Holder
may pledge this Note to any financial institution as collateral upon written
notice to Maker.

9.   Notices

Any notice required or permitted by this Note shall be in writing and shall be
deemed sufficient upon delivery, when delivered personally or by a
nationally-recognized delivery service (such as Federal Express or UPS), or five
days after being deposited in the U.S. mail, as certified or registered mail,
with postage prepaid, addressed to the party to be notified at such party's
address as set forth below or as subsequently modified by written notice.

10.  Severability

If any provision or any word, term, clause, or part of any provision of this
Note shall be invalid for any reason, the same shall be ineffective, but the
remainder of this Note and of the provision shall not be affected and shall
remain in full force and effect.


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<PAGE>

11.  Subordination

Maker's obligations under this Note shall be subordinate in right of payment to
Senior Indebtedness (as defined below) of Maker. This Note shall be subject to
the forms of subordination agreement requested from time to time by holders of
Senior Indebtedness, and Holder agrees to enter into such forms of subordination
agreement upon request of such holders of Senior Indebtedness and be bound by
such agreements. "Senior Indebtedness" as used herein shall mean the principal
of (and premium, if any) and unpaid interest on, indebtedness of Maker, or with
respect to which Maker is a guarantor, outstanding or under credit lines
existing as of the date of this Note, or to banks, insurance companies, lease
financing institutions or other lending institutions or business units of such
institutions regularly and primarily engaged in the business of lending money,
which is for money borrowed (or purchase or lease of equipment in the case of
lease financing) by Maker, and which is approved by the Board of Directors of
Maker, whether or not secured, and whether or not previously incurred or
incurred in the future, or indebtedness of Maker to sellers of land, equipment,
furniture, fixtures, components or assets or stock secured by the asset or
shares purchased. Other than Senior Indebtedness, the indebtedness owing under
this Note shall not rank junior in right of priority of payment to borrowed
money of Maker incurred hereafter.

12.  Dividends; Redemptions

As long as any principal or unpaid interest on any Series B Note remains
outstanding, the Maker shall not declare or pay any dividends or make any
distributions of cash, property or securities of the Maker in respect of its
capital stock or apply any of its assets to the redemption, retirement, purchase
or other acquisition of its capital stock

IN WITNESS WHEREOF, the Maker has caused this Subordinated Promissory Note to be
issued as of the date first written above.

MAKER: IPG PHOTONICS CORPORATION


By:
    ---------------------------------
    Chairman of the Board and
    Chief Executive Officer

Address: 50 Old Webster Road
         Oxford, MA 01540

Attn: Corporate Secretary


AGREED TO AND ACCEPTED:

HOLDER: [__________]


By:
    ---------------------------------
Name:
      -------------------------------
Title:
       ------------------------------

Address: [__________]
Tax ID Number:
               ----------------------


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