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Exhibit 10.20
June 7, 2000
TO: VIA FACSIMILE - 044-1344-623-090
CELLPOINT INC.
BUILDING A
TRINITY COURT
WOKINGHAM ROAD
BRACKNELL, BERKSHIRE
RG42 1PL
UK
Dear Sir,
RE: COMMITMENT TO LEND
LENDERS - M&S TRUST COMPANY LIMITED
BOROWER - CELLPOINT INC.
We have received your proposal for a loan and we are pleased to advise that the
Lenders have approved subject to the following terms and conditions the credit
facility listed below.
BORROWER: Cellpoint Inc., a Nevada corporation having its
address in care of address stated above.
CREDIT FACILITY: Four Million United States Dollars (US$4,000,000.00).
TERM: The loan shall be for a term of thirteen (13) months
from the date of acceptance of this Letter of Loan
Approval.
CURRENCY: The lawful currency of the United States of America
namely, United States Dollars.
AVAILABILITY AND Anticipated by way of single draw down payment to be
DRAW DOWN: made at the Borrower's bank by way of wire transfer
to the Borrower's account at Bank of America, Irvine
Industrial Branch, Newport Beach, California, U.S.A.
PRE-PAYMENT: The Borrower shall have the privilege of repaying the
whole. of the loan at any time provided the Borrower
has given the Lender ten (10) days' written notice of
its intention to pre-pay the loan and it is not in
default and pays at the time of repayment all
interest due to the Lender at that time together with
the principal. All principal sums on amounts being
pre-paid shall be paid to the date of said
prepayment.
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PURPOSE: To provide working capital and defray operating
expenses. The Borrower shall not use the advance for
any purpose -except that permitted under this clause
save with the express written consent of the Lender,
which consent may be refused for any reason. Failure
by the Borrower to comply with this clause should not
prejudice any rights of the Lender who shall not be
responsible for monitoring or ensuring the use or
application by the Borrower of any of the loan.
COMMITMENT FEE, LEGAL The negotiation fee/commitment fee shall be in the
FEE AND DISBURSEMENTS: sum of Ten Thousand United States Dollars
(USSIO,000.00) plus one hundred thousand share
wan-ants to be issued by the Borrower in favour of the
Lender in the form annexed hereto, which warrants
shall be exercisable at Twenty United States Dollars
(TJS$20.00) per share. It is agreed that the Borrower
shall register the underlying shares in respect of the
warrants as soon as possible in the name of the Lender
and advise the Lender of such registration as soon as
practical thereafter.
In the event of the security documents or any of them
being brought within the Turks and Caicos Islands such
that stamp duty becomes payable thereon, said duty
shall be paid by the Borrower and in default shall be
paid by the Lender and added to the principal amount
of the loan and shall suffer interest at applicable
rate until payment in full, Failure to pay the stamp
duty upon demand of the Lender shall constitute
default hereof.
INTEREST RATE: Nine (9) per centum per annum from the date of
advance unless in default when the applicable
interest rate shall be two per centum per annum (2%)
in addition to the Interest Rate for the entire
period of default.
All interest under this agreement shall accrue from
day to day and shall be calculated on the basis of the
actual number of days elapsed and on the basis of a
365 day year. Any certificate or determination by the
Lender as to any rate of interest payable or interest
outstanding under this Agreement shall in the absence
of manifest error be conclusive an binding.
RE-PAYMENT: Interest shall be payable quarterly in cars. Principal
shall be paid on expiry of the term, at which time all
principal and any interest due shall be payable in
full.
Partial pre-payment may be made but, if so, in a
minimum amount of Two Hundred Fifty Thousand United
States Dollars
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(US$250,000.00) and an integral multiple of Fifty
Thousand United States Dollars (US$50,000.00) and all
interest payable on the pre-paid sum to the date of
prepayment shall be paid at that time.
TAXES: All payments to be made by the Borrower under this
Agreement shall be made free and clear of and without
deduction for or on account of Taxes unless the
Borrower or any Bank through which a payment is made
is required to make such a payment subject to the
deduction or withholding of Taxes, in which case the
amount payable by the Borrower in respect of which
such deduction or withholdings is required to be made
shall be increased to the extent necessary to ensure
that, after the making of such deduction or
withholding, the Lender received and retains (fee
from any liability in respect of any such deduction
or withholding) a net amount equal to the sum which
it would have received and so retained had no
deduction or withholding been made or required to be
made.
SECURITY: 1. This Letter of Loan Sanction duly executed by
the Borrower acting as formal Loan Agreement.
2. Copy of the corporate resolutions of the
Borrower and other supporting loan documentation
as may be reasonably required by the Lender's
attorneys.
3. Such further items of corporate governance and
information as may be reasonable required by the
Lender's attorneys.
REPRESENTATIONS
& WARRANTIES: The Borrower represents and warrants to the Lender
that:
1. It is a limited liability company duly
incorporated and validly existing under the laws
of the United States of America and has power to
carry on its business and to own its property
and assets.
2. It has power and authority, deliver and perform
its obligations under this Agreement and the
Share Warrants and to use the facility as
referred to herein and that all necessary
action has been taken and not revoked to
authorize the execution and performance of this
Agreement and subject to all applicable
insolvency laws, this Agreement constitutes its
valid and legally binding obligation
enforceable in accordance with the terms
thereof.
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3. The execution and delivery and the performance
of this Agreement, the delivery of the Share
Warrants and the use of the facility do not and
will not:
(a) contravene any law, regulation,
directive, judgment or order to which it
is subject; or
(b) result in any actual or potential breach
of, or default under, any obligation,
agreement, instrument or consent to which
it is a party or by which it is bound or
under which it is required to carry on its
business; or
(c) contravene any provision of its Memorandum
and Articles of Association and/or charter
and by-laws and/or constitutional
documents.
4. No litigation, arbitration or administrative
proceedings and no dispute with any statutory
or Governmental authority is current or pending
or to its knowledge threatened against it or
any of its assets which might or would or be
likely to have a material adverse effect on its
business assets or its financial condition or
its ability to observe, perform and deliver
upon its obligation under this Agreement.
5. No event of default has occurred or is continuing.
6. It is not in default in the payment of any due
and payable taxes or filing registration or
recording of any document or under any legal or
statutory obligation which default might have a
material adverse effect on the Borrower or its
ability to perform this Agreement.
7. The latest report and financial statement of
the Borrower as-provided to the Lender have
been prepared in accordance with generally
accepted accounting principles and practices in
the United States consistently applied and give
a true and fair view of the financial
condition, assets and liabilities of the
Borrower at the date to which such financial
statements have been prepared and since that
date, there has been no material adverse change
in the financial condition or the business,
assets and operations of the Borrower which
taken as a whole might or be likely to be or
have a material adverse effect on its business,
assets or financial condition or its ability to
observe and perform its
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obligations under this Agreement.
8. The Borrower will provide the Lender with
updated financial statements as soon as same
become available to the Borrower.
9. All factual information supplied by the
Borrower to the Lender whether contained herein
or otherwise without limitation in
contemplation of or for the purpose of this
Agreement was true and accurate in all material
respects as at its date and not misleading and
such information did not omit anything nor
since the date of such information has anything
occurred which renders that information untrue
or misleading in any material respect or which,
if disclosed, might or would be likely to
adversely effect the decision of a person
considering whether to enter into this
Agreement and all projections and statements of
belief and opinion given by the Borrower to the
Lender were made honestly and in good faith
after due and careful enquiry and remain valid.
(All representations and warranties are being
repeated as at the draw down of any of the
facility and upon the repayment of each tranche
of interest and/or principal sum herein.)
CONDITIONS: 1. Execution and delivery of all loan and security
documentation to the reasonable satisfaction of
the Lender's attorneys.
EVENTS OF DEFAULT: In the event of default by the Borrower, the
principal amount and interest thereon shall, at the
option of the Lender, immediately become due and
payable upon written notice whether with or without
prior demand therefor, and the security shall
immediately become enforceable. Without limiting the
generality of the foregoing, demand may be expected
in each and everyone of the events following:
1. If the Borrower makes default in payment when
due of any indebtedness to the Lender.
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2. If the Borrower makes default in payment when
due on performance of something required to be
done of some covenant or condition to be
observed or performed by the Borrower pursuant
to this Agreement, or any securities given in
support hereof.
3. If the Lender breaches any term or condition or
warranty or undertaking of this Loan Agreement.
4. If the Borrower fails to comply with any filing
or other statutory requirements of its
jurisdiction of domicile, namely U.S.A..
5. If any Order is made or an effective resolution
passed for the winding-up of the Borrower, or if
a petition is filed for the winding-up of the
Borrower.
6. If the Borrower becomes insolvent or files for
protection from its creditors under applicable
law.
DEFAULT INTEREST/ In order to compensate the Lender in damages in the
AGREED DAMAGES: event of default, it is agreed that the Interest Rate
applicable to all sums due hereunder, whether by way
of principal, interest or howsoever arising, shall be
two percentum per annum. (2%) above the Interest Rate
until payment in full of all sums is made. It is
agreed that this rate of interest is intended to
compensate the Lender in agreed damages in the event
of default and is not in the nature of a penalty.
NOTICES: Notices may be delivered by fax or by registered
mail. If by fax, notices shall be deemed served on
the next following business day following apparent
successful transmission evidenced by sender's
transaction report (hard copy to follow by mail) and
if by registered mail, shall be deemed served seven
(7) after the day of posting.
WAIVERS: No waivers, delays, consents or failure to act by the
Borrower will defeat or affect any or all of the
Borrower's rights herein.
SEVERANCE: If any of the provisions of this Agreement is or
becomes legal, invalid or unenforceable in any
respect under any law or regulation of any
jurisdiction, neither the legal validity nor the
enforceability of the remaining provisions of this
Agreement nor the legality, validity or
enforceability of such provision itself under the law
of
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any other jurisdiction shall in any way be affected or
impaired as a result.
APPLICABLE LAW: The laws of the Turks and Caicos Islands.
JURISDICTION: The Courts of the Turks and Caicos Islands or the
Courts of the United States of America, United
Kingdom or elsewhere at the sole option of the Lender.
If you are in agreement with the above terms and conditions, please approve the
attached copy and return it to us prior to us the 30th day of June, 2000.
Yours truly,
M&S TRUST COMPANY LIMITED
PER /s/ Timothy P. O'Sullivan
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MANAGING DIRECTOR
WE HEREBY ACKNOWLEDGE AND AGREE to all of the above stated terms and conditions
this 28th day of June, 2000.
/s/ Lynn Duplessis
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FOR AND ON BEHALF OF CELLPOINT INC. -
BORROWER
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