SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) September 28, 1995
BARRINGER TECHNOLOGIES INC.
(Exact name of registrant as specified in its charter)
Delaware 0-3207 84-0720473
(State or other jurisdiction of (Commission (IRS Employer
incorporation) File Number) Identification No.)
219 South Street, New Providence, New Jersey 07974
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (908) 665-8200
Item 5. Other Events.
On September 28, 1995, Barringer Technologies Inc. (the
"Company") entered into a heads of agreement (the "Agreement") with the
Toronto-Dominion Bank (the "Bank"), pursuant to which the Bank agreed that
the Company's subsidiary, Barringer Research Limited ("BRL"), may have
until September 30, 1995 to come into compliance with certain covenants
specified in the Agreement. In exchange, the Company has agreed to dispose
of its interest in Barringer Laboratories Inc. ("Labco") and to contribute
to BRL a portion of the net proceeds of such sale. (The Company had
already intended to dispose of its interest in Labco, and has previously
disclosed that intention.) In addition, the Company agreed to provide the
Bank with additional collateral to secure its advances to BRL.
The above description of the Agreement is a summary of certain
of the terms of the Agreement, is not intended to be complete, and is
qualified in its entirety by reference to the Agreement which has been
filed as an Exhibit to this Current Report on Form 8-K.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit 10.1 Agreement between the Toronto-Dominion Bank
and Barringer Technologies Inc. and Barringer Research Limited
dated September 28, 1995.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
BARRINGER TECHNOLOGIES INC.
By: /s/ Richard S. Rosenfeld
Richard S. Rosenfeld,
Vice President, Finance
Dated: October 13, 1995
EXHIBIT INDEX
Exhibit Page No.
10.1 Agreement between the Toronto-Dominion Bank and
Barringer Technologies Inc. and Barringer Research
Limited dated September 28, 1995.
September 20, 1995
Barringer Research Limited
304 Carlingview Drive
Rexdale, Ontario
M9W 5G2
Attention: Mr. John H. Davies, President
Dear Mr. Davies:
We wish to inform you of the Bank's present intention to make
available to following uncommitted credit facility:
The following company name short forms shall apply herein:
Barringer Technologies Inc. ("BTI")
Barringer Instruments Inc. ("BII")
Barringer Consumer Products Inc. ("BCPI")
Ontario Development Corporation ("ODC")
Barringer Instruments Limited ("BIL")
BORROWER BARRINGER RESEARCH LIMITED ("the Borrower")
LENDER The Toronto-Dominion Bank (the "Bank"),
through its Mississauga Centre branch, in
Mississauga, Ontario.
TYPE OF CREDIT
AND AMOUNT 1) Operating Loan
Up to $1,000,000
Available at the Borrower's option by way of:
Prime Rate Based Loans ("Prime Based Loans")
Letters of Credit ("L/Cs") and/or Stand-by Letters
of Guarantee ("L/Gs") to a maximum of $100,000.
2) Performance Bond $360,000
All amounts referred to herein are in
Canadian dollars unless otherwise stated.
INTEREST RATES AND FEES 1) Operating Loan shall bear interest and fees as
follows:
Prime Based Loans - Prime Rate + 1.5% per annum.
L/Cs - As advised by the Bank at time of
issuance of L/C.
L/Gs - 1% per annum.
2) 1.5% per annum.
Prime Rate means the rate of interest per
annum (based on a 365/366 day year)
established and reported by the Bank to the
Bank of Canada from time to time as the reference
rate of interest for determination of interest
rates that the Bank charges to customers of
varying degrees of creditworthiness in Canada
for Canadian dollar loans made by it in Canada.
INTEREST CALCULATION
AND PAYMENT Interest on Prime Based Loans is calculated
daily and payable monthly in arrears based on
the number of days which the loan is
outstanding.
Interest is payable both before and after
demand, default and judgment.
L/C and L/G fees are payable at the time of
issuance of the L/C or L/G and annually
thereafter.
ARRANGEMENT FEES The Borrower will pay a non-refundable
arrangement fee of $5,000.
Business Credit Service Agreement fee of $300
per month, $50 per month upon meeting the
terms and conditions contained in this offer
to finance.
REPAYMENT Uncommitted, and repayable on demand. If the
Bank demands repayment, the Borrower will pay
to the Bank all amounts outstanding under the
Operating Loan including without limitation,
the amount of all drawn and undrawn L/Gs,
L/Cs and the Performance Bond.
REPORTING 1) The Borrower, BTI, BII and BCPI will
provide the Bank with monthly,
unaudited financial statements and
signed audited, annual consolidated
financial statements within 30 days and
120 days of each respective period.
2) Credit checks for margin purposes on
foreign receivables to be obtained
through our International Centre with
all costs borne by the company. Such
checks to be completed at the Bank's
discretion.
3) Aged accounts receivable lists for the
Borrower and BII (showing receivables
pledged to ODC) to be provided by 15th
day following month end.
4) The Borrower and BII will provide
weekly sales reports including proof of
orders.
FINANCIAL AND OTHER The Bank presently requires that:
1) The Operating Loan will not exceed 80%
of accounts receivable net of over 90
day accounts, related accounts except
accounts from Barringer Instruments
Inc. that are offset dollar for dollar
by under 90 day Barringer Instruments
Inc. accounts receivable not pledged to
the Ontario Development Corporation and
satisfactory to the Bank, debt to the
Ontario Development Corporation and
foreign receivables of high risk as
determined by the Bank, unless insured
or secured by a Letter of Credit from
an established, reputable Bank.
Effective September 30, 1995,
shortfalls to a maximum $200,000
allowed. Shortfall allowance is to
reduce $50,000 per month thereafter.
Any shortfall in excess of allowed
amount to be rectified by next
reporting date.
2) As at December 31, 1995 Net Worth to be
a minimum of $700,000 defined as
shareholders equity plus related debt
less related receivables less
intangibles less related investments.
Receivables due from BII to be given
value only if covered dollar for dollar
by under 90 day BII accounts receivable
not pledged to ODC and satisfactory to
the Bank.
3) As at December 31, 1995 Working Capital
to be a minimum of $225,000 defined as
Current Assets less related receivables
less Current Liabilities. Receivables
due from BII to be given value only if
covered dollar for dollar by under 90
day BII accounts receivable not pledged
to ODC and satisfactory to the Bank.
4) BTI is to agree in writing to forward
to the Borrower 50% of the first U.S.
$1,000,000 and 75% of the remaining net
cash proceeds from the sale of its
equity interest in Barringer
Laboratories Inc.
5) The borrower is not to ship any Ionscan
equipment without proof of firm, end
order. Exceptions will be allowed for
a maximum 5 Ionscan Model 350 machines
shipped to Barringer Consumer Products
Inc. for Drug Alert product purposes.
Machines being shipped for testing
purposes without firm order to be
allowed at the Bank's decision.
6) BTI, BCPI, and BII are not to
withdraw/receive funds from the
Borrower without prior written consent
from the Bank.
7) The Bank will return the BRL and BIL
shares pledged as security on January
31, 1996 providing all terms and
conditions contained herein are in
compliance.
A breach of these tests is not a precondition
to the Bank's right to demand repayment.
SECURITY AND
OTHER DOCUMENTATION The following security shall be provided,
shall be registered in first position (unless
otherwise stated), and shall be on the Bank's
applicable standard form, supported by
necessary resolution and solicitor's opinion,
all acceptable to the Bank:
a) General Security Agreement from the
Borrower;*
b) Unlimited Guarantees from the following:
Barringer Technologies Inc.*
Barringer Instruments Inc.*
Barringer Consumer Products Inc., LLC
Barringer Instruments U.K., Ltd.
Barringer Europe, SARL
(the "Guarantors");
c) Assignment of Fire Insurance in the
name of the Borrower*;
d) General Assignment of Book Debts from
Barringer Instruments Inc.*
Barringer Instruments Inc.'s U.S.
counsel to confirm the Bank holds a
valid first charge on all receivables
not assigned to the Ontario Development
Corporation.
e) Export Development Corporation
Guarantee limited to $316,000 CDN of
Performance Bond issued by the Bank*.
f) Indemnity Agreement re: Performance
Bond.*
g) Hypothecation including full power of
attorney of shares in the Borrower held
by BTI.
h) Hypothecation including full power of
attorney of shares in BIL held by the
Borrower.
* On hand.
All of the above security shall be referred
to collectively in this letter as "Bank
Security".
NON-WAIVER The Bank will not be considered to have
waived compliance with or amended any part of
this letter or any obligation of the Borrower
hereunder or under any other document unless
such waiver or amendment is set out
specifically in writing. The Bank shall not
be deemed to have waived compliance with any
obligation of the Borrower simply because it
does not exercise any of its rights and
remedies immediately upon the occurrence of
such breach.
REPRESENTATIONS No representation or warranty or other
statement made by the Bank concerning the
credit shall be binding on the Bank unless
made by it in writing as a specific amendment
to this letter.
ENVIRONMENTAL The Borrower represents and warrants (which
representation and warranty shall continue so
long as any amounts are outstanding
hereunder) that:
The undersigned's business, to the best of
its knowledge and belief, is being operated
in compliance with applicable laws and
regulations respecting the discharge,
omission, spill or disposal of any hazardous
materials and that any and all enforcement
actions in respect thereto have been clearly
conveyed to the Bank.
The undersigned shall, at the request of the
Bank from time to time, and at the
undersigned's expense, obtain and provide to
the Bank an environmental audit or inspection
report of the property from auditors or
inspectors acceptable to the Bank.
The undersigned hereby indemnifies the Bank,
its officers, directors, employees, agents
and shareholders, and agrees to hold each of
them harmless from all loss, claims, damages
and expenses (including legal and audit
expenses) which may be suffered incurred in
connection with the indebtedness under the
Note or the security provided to secure such
indebtedness.
EXPENSES The Borrower shall pay all reasonable fees
(including but not limited to all legal and
documentation fees) and expenses incurred by
the Bank or the Borrower in connection with
the preparation of this letter and the
preparation and registration of the Bank
Security and with the enforcement of the
Bank's rights relating to the Operating Loan
or the Bank Security, whether or not any
amounts are advanced under the Operating
Loan. These fees and expenses shall include,
but not be limited, to all outside counsel
expenses and all in-house legal expenses, if
in-house counsel are used.
EVIDENCE OF INDEBTEDNESS The Bank's records constitute, in the absence of
manifest error, conclusive evidence of the
indebtedness of the Borrower to the Bank.
OTHER AGREEMENTS The Borrower acknowledges that it may sign
other Bank documents relating to the Operating
Loan, such as the Bank's Business Credit
Service Agreement and that the terms and
conditions contained in such other documents
shall be deemed to be incorporated herein
by reference and also apply to the credit
facility.
GOVERNING LAW The laws of the Province of Ontario and of
Canada.
We ask that if you wish to accept this offer of financing please do so
by signing and returning the attached duplicate copy of this letter to the
undersigned. Please have the guarantors execute the acknowledgment and
consent outlined on the next page. This offer replaces any offers to
finance issued in the past
Yours truly,
/s/ Paul C. Zilkey /s/ J. Ritchie
Senior Account Manager Manager Commercial Services
The undersigned hereby accepts the foregoing offer this day
of , 1995.
BARRINGER RESEARCH LIMITED
/s/ J. Davies (President)
Per:
______________________________
Per:
TO THE TORONTO-DOMINION BANK:
The undersigned hereby acknowledge and consent to the foregoing offer
this day of , 1995 and agree that if the Bank fails to insist upon
strict performance of observance of the requirements of the letter set out
above or in any other agreement which now or may hereafter apply to the
credit facility, or waives or amends any such requirements, such action
shall not prejudice the Bank's rights under the guarantees of the Borrower
provided by us.
BARRINGER TECHNOLOGIES INC. BARRINGER EUROPE, SARL
/s/ Stanley Binder, CEO /s/ J. Davies
per: per:
_____________________________ _______________________________
per: per:
BARRINGER INSTRUMENTS INC. BARRINGER INSTRUMENTS U.K., LTD.
/s/ Stanley Binder, CEO /s/ J. Davies
per: per:
_____________________________ _______________________________
per: per:
BARRINGER CONSUMER PRODUCTS INC., LLC
/s/ Stanley S. Binder, CEO
per:
_____________________________
per:
AGREEMENT
THIS AGREEMENT is made this day of September, 1995
BETWEEN:
THE TORONTO-DOMINION BANK
(the "Bank")
-and-
BARRINGER TECHNOLOGIES INC.
("BTI")
-and-
BARRINGER RESEARCH LIMITED
("BRL")
WHEREAS:
A. BTI is the parent of BRL.
B. BRL is indebted to the Bank and is in default of its obligations to
the Bank.
C. BTI and BRL have requested, and the Bank has agreed, that BRL shall
have until 30 September 1995 to come into compliance with certain
covenants owed to the Bank.
IN CONSIDERATION OF the Premises and for other valuable consideration, the
receipt and sufficiency of which is hereby acknowledged by the parties
hereto, the parties agree as follows:
1. BTI shall dispose of its interest in Barringer Laboratories Inc.
("Labco") as soon as possible and shall remit 50% of the first U.S.
$1 million of the net proceeds of sale of BTI's interest in Labco to
BRL's account with the Bank and shall remit 75% of the net proceeds
of sale over U.S. $1 million to BRL's account with the Bank. (The
net proceeds of sale will be the amount payable to BTI for all and
any interest it may have in any shares or warrants or other interest
in Labco net of an existing note payable by BTI to Labco in the
amount of approximately U.S. $500,000 plus the reasonable expenses
incidental to such sale).
2. BTI and BRL shall immediately cause Barringer U.K., Barringer Europe
S.A. and Barringer Consumer Products to provide guarantees of the
obligations of BRL to the Bank, in form and substance satisfactory to
the solicitors for the Bank together with such certificates,
resolutions and other necessary documents as the Bank in its
discretion deems appropriate.
3. BTI shall immediately hypothecate and pledge all of the shares of BRL
which it holds, owns or controls to and/or in favour of the Bank or
its nominee and shall take or cause to be taken all steps, including
the preparation and execution of such resolutions, certificates and
other documents as the Bank in its sole discretion may deem
appropriate to give effect to such hypothecation and pledge.
4. BRL shall immediately hypothecate and pledge all of the shares of
Barringer Instruments Limited ("BIL") which it holds, owns or
controls to and/or in favour of the Bank or its nominee and shall
take or cause to be taken all steps, including the preparation and
execution of such resolutions, certificates and other documents as
the Bank in its sole discretion may deem appropriate to give effect
to such hypothecation and pledge.
5. BRL and all Guarantors shall execute the revised commitment letter
between BRL and the Bank substantially in the form annexed as
schedule "A" to this agreement.
6. Time is of the essence of this agreement.
7. BTI and BRL shall do such acts and shall execute such further
documents, conveyances, deeds, assignments, transfers and the like,
and will cause the doing of such acts and will cause the execution of
such further documents as are within its power as the Bank may in
writing at any time and from time to time reasonably request be done
and or executed, in order to give full effect to the provisions of
this agreement.
8. This agreement may be executed in any number of counterparts. Each
executed counterpart (including a facsimile copy of such executed
counterpart) shall be deemed to be an original; all executed
counterparts taken together shall constitute one agreement.
9. This Agreement is governed by the laws of the Province of Ontario and
the laws of Canada applicable therein.
IN WITNESS WHEREOF this agreement has been duly executed on the date first
above written.
THE TORONTO-DOMINION BANK
by:_______________________________
BARRINGER TECHNOLOGIES INC.
by: /s/ Stanley Binder, CEO
(I have the authority to bind the
corporation)
BARRINGER RESEARCH LIMITED
by: /s/ M. Olwyn
(I have the authority to bind the
corporation)
