Exhibit 10(a)
CREDIT LINE
The present Credit Line ("Credit Line") is signed in RHODE ISLAND on 19 February
1998, between
BANQUE NATIONALE DE PARIS, a public limited company (societe anonyme) under
French law with a capital of FF 4,822,605,450, whose registered offices are
located at 00 xxxxxxxxx xxx Xxxxxxxx - 00000 Xxxxx, entered on the Paris
Corporate Register under number B 662 042 449,
represented by Xx. Xxxx XXXXXXX, Directeur du Departement Entreprises du Groupe
d'Agences de DROME-ARDECHE,
referred to hereinafter as 'BNP' or 'BANK'
AND
BACOU USA INC., a corporation organized and existing under the law of Delaware
with its principal office at 00 Xxxxxxx Xxxxxxxxx, Xxxxxxxxxx, XX 00000 XXX,
represented by Xx. Xxxxxx XXXXXX, Vice-Chairman, President and CEO, and Xx.
Xxxxxx X. XXXX Xx., Executive Vice-President and Chief Financial Officer,
referred to hereinafter as 'BACOU USA' or 'Borrower'
PREAMBLE
Under the terms of negotiations carried out between BACOU USA and BNP, BNP
declared that it is prepared, to grant BACOU USA a credit line of USD
110,000,000 (hundred ten million American dollars) under the terms and
conditions set forth below.
IN WITNESS WHEREOF, IT IS AGREED AND DECIDED AS FOLLOWS BETWEEN THE PARTIES TO
THE PRESENT
ARTICLE I - AMOUNT OF THE CREDIT LINE
BNP grants BACOU USA a credit line (referred to hereinafter as the 'Credit
Line') for an amount of USD 110,000,000 (hundred ten million American dollars).
ARTICLE II - OBJECT OF THE CREDIT LINE
The object of the Credit Line is the financing of the acquisition of the
operating assets of Xxxxxx Xxxxxx Industries of San Diego, California, USA by
BACOU USA.
ARTICLE III - TERM OF THE CREDIT LINE
The Credit Line is granted for a term of seven years starting from the drawing
date as defined in Article V hereafter.
ARTICLE IV - REPAYMENT
The Credit Line shall be repaid quarterly as from the drawing date in
twenty-seven installments of USD 3,928,600 (Three million nine hundred
twenty-eight thousand six hundred American dollars) and a final installment of
USD 3,927,800 (Three million nine hundred twenty seven thousand eight hundred
American dollars).
At all events, the Credit Line shall be repaid in full no later than the last
banking day of the term defined in Article III above.
A banking day is defined for the needs of the present agreement as a business
day. A business day is a day on which dealings in USD are carried on in the
Paris Interbank Market, in London and in New York, and BNP is open for domestic
and foreign exchange business in Paris and wherever applicable, in financial
centers required to be open to permit dealings in connection with this
agreement.
ARTICLE V - TERMS AND CONDITIONS OF DRAWING
The Credit Line shall be drawable fully in one time during a period of twenty
days following the date of signature of the present Agreement, with a prior
notice of two banking days, through the debit of a special account constituting
a simple book statement that will have no legal effects attached to the current
account and which be opened for this purpose on the books of the BNP VALENCE
agency.
The drawing date means in the present Agreement the date of the debit of such
special account.
Such prior notice shall reach BNP no later than 10:00 a.m. (London time) in
accordance with the form fixed in Appendix 1 to the present agreement.
ARTICLE VI - FINANCIAL TERMS AND CONDITIONS
Interest period shall be three months, calculated as from the drawing date.
BACOU USA shall due and pay interest to BNP on the last banking day of each such
periods of three months.
a) Rate of interest:
Interest shall be calculated on the exact number of days of the period
considered based on 360 days per year at the LIBOR rate (London Interbank
Offered Rate) of the USD considered for a period of three months, calculated
under the aegis of the British Bankers Association and published by Telerate -
page 3750/3740 or by any other page that might be substituted for it - at 11:00
a.m. (London time), two working days prior to the drawing date or the beginning
of an interest period, increased by 0.30% per year.
The rate shall be revised at each interest period.
BNP shall notify BACOU USA of the interest rate applicable to each three months
interest period.
b) Interest on arrears:
All sums (including any cost or expenses) not paid on their normal or early due
date shall bear interest ipso jure from the day of the said due date included to
the day of its full payment excluded at the interest rate applicable as defined
above, increased by 1% per year.
Interest shall be capitalized if it is due for a full year in application of
Article 1154 of the Civil Code. These provisions do not apply as the granting of
a delay in payment.
c) Impossibility of determining the rate of interest:
If determination of a rate of interest has become impossible following certain
events, BNP shall notify BACOU USA thereof and the parties shall enter into
negotiation. If an agreement in view of reaching a solution is not reached
within thirty days of the said notification, BACOU USA shall repay the Credit
Line in capital, interest, expenses, incidental expenses and possible costs, it
being understood that the applicable rate of interest shall be BNP's cost of
financing, increased by 1% per year.
d) Unavailability of USD:
If BNP should observe, either on the occasion of the drawing or on the occasion
of a new interest period, that the USD currency is unavailable, it shall advise
BACOU USA thereof as rapidly as possible.
BACOU USA and BNP shall consult in order to select a replacement currency.
Failing agreement within 24 hours of the notice sent to BACOU USA by fax, the
Credit Line is considered cancelled ipso jure, and BACOU USA shall repay and pay
in FRF or in the single European currency the capital, interest, expenses,
commissions and incidental expenses and any possible costs caused to BNP by the
unavailability of the currency used.
The amount in FRF or in the single European currency being repaid and paid shall
be determined in accordance with the most recent quotation of the USD against
the FRF or the single European currency.
e) Commitment fee:
0.20% per year payable quarterly in advance and calculated starting from the
drawing date.
It shall be calculated on the basis of a year of 360 days and payable in USD.
f) Flat fee:
0.08% payable on the drawing date.
g) BACOU USA shall pay a sum of FRF 75.000 Hors Taxes for file costs on the
drawing date.
ARTICLE VII - CONDITIONS PRECEDENT
No drawing will be made before payment by BACOU USA of all sums, fees and
expenses which could be due on the date of such drawing pursuant to this
Agreement and receipt by BNP in a form and substance satisfactory to it of the
following documents:
a) a certified copy of all corporate documents of BACOU USA and of the Guarantor
required to authorize the execution of this Agreement and the Guarantee and to
empower their representatives for this purpose;
b) duly authenticated specimen signatures of each of the empowered
representatives of BACOU USA and of the Guarantor;
c) a certified copy of the constitutive documents of BACOU USA;
d) the Guarantee and evidence it has been duly executed and is in full force and
effect;
e) an opinion of a legal counsel from the State of Rhode Island in the terms of
the Appendix 2 acceptable to BNP and confirming that the representations of
BACOU USA made in Article VIII are true.
ARTICLE VIII - REPRESENTATIONS AND WARRANTIES
BACOU USA represents and warrants to BNP that:
-- (i) it is a corporation duly organized, validly existing and in good standing
under the laws of the State of Rhode Island;
-- (ii) the execution and performance of this Agreement do not contravene any
provision of law or regulation to which BACOU USA is subject;
-- (iii) it has obtained all necessary consents, licenses or authorizations for
the execution and performance of this Agreement and especially it has been
authorized to acquire and transfer on maturity the necessary currencies for
payment of all sums due under this Agreement;
-- (iv) its capital stock is held of 71.70% by the Guarantor;
-- (v) no tax, registration fee, stamp or similar duty, nor any deposit or any
registration is required in connection with this Agreement or for validity of
the same;
-- (vi) no proceedings are underway or, to the knowledge of BACOU USA, are about
to be instituted to prevent or forbid signature or performance of the Credit
Line, or which might have a significant unfavorable effect on the capacity of
BACOU USA to perform its obligations under the present Credit Line;
-- (vii) no action is underway for the purposes of liquidation, dissolution or
any other similar procedure with regard to BACOU USA;
-- (viii) there exists no fact that is likely to constitute a Case of Default;
-- (ix) the choice of French law and the competence of the French courts
provided for in Article XIV below are legitimately binding on BACOU USA and
shall be validly acknowledged by the courts of the State of Rhode Island and the
Federal Courts of the United States of America, and consequently any or all
judgments handed down by the French Courts shall be exequatured and enforceable
in United States of America.
The representations and warranties contained in the present article shall be
considered renewed by BACOU USA at the time of request for drawing.
ARTICLE IX - COVENANTS BY BACOU USA
So long as it is a debtor or may remain a debtor pursuant to the Credit Line,
BACOU USA undertakes:
-- to hand over to BNP all accounting documents and data that BNP might request;
-- to immediately inform BNP of all facts that might significantly lessen its
assets or significantly increase the volume of its commitments;
-- to immediately inform BNP of all facts or circumstances that are likely to
constitute or become one of the cases mentioned in the Article CASES OF DEFAULT;
-- to assume the financial consequences of changes in parity which might
intervene up to the time of full repayment of the Credit Line.
ARTICLE X - NEGATIVE COVENANTS BY BACOU USA
Until payment in full of all of BACOU's USA obligations to BNP under this
Agreement, BACOU USA covenants and agrees as follows:
1 -- Limitation on Borrowing
BACOU USA shall not incur, create, assume or permit to exist any Debt or
liability on account of deposits or advances or any indebtedness or liability
for borrowed money, or any indebtedness or liability evidenced by any notes,
bonds, debentures or similar obligations, including leases, except (a) Debt to
BNP, (b) Debt existing as of the date of the closing of Credit Line and approved
in writing by BNP including USD. 15,000,000 to CITIZENS BANK OF RI to complete
the financing of the XXXXXX XXXXXX INDUSTRIES transaction and up to a total of
USD. 31,000,000 to CITIZENS BANK OF RI under its line of credit to BACOU USA,
(c) Debt pertaining to any capitalized lease obligations provided such Debt when
combined with all other capitalized lease obligation does not exceed in the
aggregate One Million Dollars per annum, (d) Debt the terms and conditions of
which have been approved in writing by BNP and which Debt is subordinated, if
required by BNP, to the prior payment of all amounts due under the Credit Line,
and (e) trade obligations incurred by BACOU USA in the ordinary course of
business.
2 -- Limitation on Encumbrances
BACOU USA shall not create, incur, make, assume, or suffer to exist, after the
date hereof, any assignment, mortgage, pledge, security interest, lien or other
encumbrance of or upon any of its properties or assets, whether now owned or
hereafter acquired, to any party other than BNP, exception (a) liens for taxes
not delinquent or being contested in good faith by appropriate proceedings
diligently pressed and as to which there have been set aside on its books
adequate reserves; (b) encumbrances existing as of the date hereof, disclosed in
writing to BNP and approved by BNP in writing; (c) liens imposed by operation of
law, such as warehouseman's or mechanic's liens, incurred by BACOU USA in good
faith and in the ordinary course of business; and (d) liens securing Debt
permitted under the 1 [ Limitation on Borrowing ].
ARTICLE XI - CASES OF DEFAULT
The following constitutes a Case of Default once it occurs and whatever the
reason, be it attributable to BACOU USA or not:
-- non-payment at its due date of an amount due in principal, interest,
commission, expenses or incidental expenses by BACOU USA in performance of the
Credit Line, should it not be remedied within five days following the request
made by BNP in this sense to BACOU USA;
-- non-compliance by BACOU USA with another commitment or covenant under the
terms of the Credit Line;
-- any representation by BACOU USA contained in Article VIII of the Credit Line
or subsequently renewed proving to be inaccurate;
-- any debt of BACOU USA or the GUARANTOR under another contract becoming
repayable or callable prior to its normal due date following a foreclosure of
the date for payment opposed due to default;
-- any measure taken with regard to BACOU USA or the GUARANTOR for out-of-court
settlement, court-ordered re-organization, court-order redress or court-ordered
liquidation or any other analogous measure or proceedings, with the exception of
cases of liquidation or dissolution or BACOU USA the terms and conditions of
which have been approved by BNP;
-- significative change, in the opinion of BNP, in the shareholding of BACOU
USA, including nationalization of BACOU USA;
-- the occurrence of an unlawful act for BACOU USA in performing any one of its
obligations under the Credit Line;
-- the occurrence of any decision or event in United States of America or in
another country through which the payments are made, that constitutes or could
constitute an obstacle to payment by BACOU USA of any amount due to BNP under
the present Credit Line, including decisions on foreign exchange control or
embargo;
-- the Guarantee specified in Article XVI ceases to be valid or becomes
unenforceable for any reason whatsoever.
At the time of the occurrence of any one of the Cases of Default, BNP shall be
entitled to pronounce immediate early repayment and payment of all sums under
the Credit Line.
ARTICLE XII - ELECTION OF DOMICILE
For performance of the present agreement and of its consequences, domicile is
elected:
-- for BACOU USA, at its principal office address, 00 Xxxxxxx Xxxxxxxxx,
Xxxxxxxxxx, XX, 00000 XXX.
-- for BNP, at its VALENCE agency, address 0 Xxxxxxxxx Xxxxxx, 00000 XXXXXXX,
XXXXXX, Fax 00.00.00.00.00.
ARTICLE XIII - NEW CIRCUMSTANCES
1 The provisions of the Credit Line have been fixed in accordance with the
economic and financial conditions, both national and international, and with the
legal, fiscal, monetary and professional conditions in force at the time of the
signature of the Credit Line in France and abroad.
2 In the event of modification to the said conditions or facts or to their
interpretation by any competent authority, or for any other reason, resulting
particularly in new charges or in additional costs for BNP subsequent in
particular:
(a) to new requirements in the area of reserve requirements, quantitative
regulations on credit, institution or increase in coefficients for liquidities,
equity capital or other requirements relating to all or part of the assets or
commitments (including off-balance-sheet commitments), or;
(b) to a modification in exchange regulations or in the applicable tax system;
BACOU USA undertakes to compensate BNP in full for the additional charges and
costs that might be imposed on it.
Notification by BNP justifying in any form whatsoever the said charges and costs
shall be final and binding, barring error proved by BACOU USA.
In such a case, however, BACOU USA shall also have the option of making early
payment of the Credit Line in full.
ARTICLE XIV - APPLICABLE LAW AND COMPETENT JURISDICTION
The present Credit Line Agreement is governed by French law.
In the event of dispute, BACOU USA and BNP shall consult in view of an
out-of-court settlement. In the failure to reach such a settlement, all
litigation relative inter alia to the validity, interpretation or performance of
the Credit Line shall be submitted to the exclusive competence of the French
courts.
ARTICLE XV - MISCELLANEOUS PROVISIONS
1 -- Expenses, taxes and duties.
BACOU USA shall bear all expenses, duties, commissions, interest or other levies
pertaining to the present Credit Line or those that might be the sequel or
consequence thereof.
In particular, BACOU USA shall cover BNP for all of its expenses and outlays,
legal fees included, made in connection with the performance of the Credit Line
and with the implementation of BNP's rights under the Credit Line upon
presentation of supporting documents.
If, through the application of a law, an international agreement or a regulation
of any kind, BACOU USA is required to carry out a withholding on payments to be
made pursuant to the present agreement, it shall pay BNP an additional amount
such that, following deduction of the tax, BNP shall receive the full amounts
due that it would have received if the withholding had not existed.
2 -- Effective Global Rate ( [Taux Effectif Global] under French law).
The effective global rate is calculated below on the date of 1998/02/11 for USD
and for a period of three months.
It is specified that, on the basis of the three-month LIBOR rate for the USD
(5.6250% at the date of 1998/02/11), taking into account fees, expenses and
margin, and on the basis of use for 360 days, full use of the said Credit Line
as of the date of 1998/02/11 would come to an effective global rate of 6.1532%.
3 -- Payments.
All obligations of payment under the Credit Line, (except expenses specified at
g) of the Article VI payable in French Francs) shall be paid in full by BACOU
USA by means of payments in USD to the BNP at its address referred to in Article
[ ELECTION OF DOMICILE ].
All payments by BACOU USA under this Agreement shall be made without set off or
counter claims.
BACOU USA shall not be entitled to subordinate such payments to any condition or
exception.
BACOU USA hereby authorizes BNP, at its convenience, to debit its account in USD
n(degree) 140 003/52 held on the BNP's books, for the said payments on the date
upon which the said payments are payable for their amount in USD.
4 -- Voluntary prepayment. No new drawings.
BACOU USA shall be entitled to prepay in full or partially without penalty the
Credit Line, but only on the date of the repayment of an installment
hereinabove, subject to the receipt by BNP of a prior written notice at least
one month before the expected prepayment date.
Once repaid or prepaid, BACOU USA shall not be permitted to redraw any sum under
the Credit Line.
ARTICLE XVI - GUARANTEE
The BACOU's USA payment obligations hereunder shall be guaranteed by BACOU SA
herein called [ the Guarantor ] a French company, whose registered office is
at VALENCE (26000-France), 168 Avenue des Aureats, entered on the Valence
Corporate Register under number B 348 982 307, in the terms of the Appendix 3
hereto.
Signed in RHODE ISLAND, on 19th February 1998
In two true copies
BACOU USA INC Banque Nationale de Paris
Read and agreed
By: /s/ Xxxxxx Xxxxxx By: /s/ Xxxx Xxxxxxx
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/s/ Xxxxxx X. Xxxx, Xx.
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