EXHIBIT 10.23
BANCA POPOLARE DI BERGAMO - CREDITO VARESINO
We received your letter dated below, which we are Dear
repeating in its entirety: BANCA POPOLARE DI BERGAMO -
CREDITO VARESINO
Milan, 03/13/2000 040 MILAN OFFICE
--------------------------------------------------- ---------------------------
Place and Date Office code and name
We the undersigned,
-------------------------------------------------------------------------------
DE NORA FUEL CELLS SPA Registry code 40/3539299
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
MILAN
-------------------------------------------------------------------------------
First and last name - Residence or legal address or joint account address
(street, postal code and city)
We wish to apply for the following line of credit:
<TABLE>
-------------------------------------------------------------------------------------------------------------------
TYPE (1) AMOUNT IN LIRE EXPIRES RATE OR SPREAD C.M.S. CHARGES SERVICE REGULAR
INDICATOR (2) (3) ACCOUNT ACCOUNT
(2) (4) (4)
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
BIA.1 2,000,000,000 Cancellation 4.50% 86256
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) for the name of TYPE of line of credit see the cash credit table below
(2) DC = to be agreed when the use procedure is set down.
(3) Quarterly charges on the maximum overdraft
(4) Until we are informed otherwise
INQUIRY CHARGES ___________________________________________________________LIRE
The other conditions not specifically agreed to by us will apply to us to the
extent set down in the detailed information sheets provided concerning the
transactions governed by this contract. We are therefore aware of them and
accept them.
We also acknowledge that our relationship will be governed by the attached
GENERAL CONDITIONS OF CONTRACT FOR CASH CREDIT and by those set down in the
following section. We declare that we are acquainted with them and accept them
all.
--------------------------------------------------------------------------------
NOTES: MERGE WITH THE EXISTING 100,000,000 LIRE (ONE HUNDRED MILLION) LINE OF
--------------------------------------------------------------------------------
CREDIT
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
<TABLE>
-------------------------------------------------------------------------------------------------------------
CASH CREDIT
-------------------------------------------------------------------------------------------------------------
MIXED SPECIFIC
-------------------------------------------------------------------------------------------------------------
TYPE DESCRIPTION USABLE TECHNICAL FORMS TYPE DESCRIPTION
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PRO.B ON CHECKING ACCOUNT BIA.1 BIA.1 Opening of credit on checking account
PRO.1 FIRST RISK AC AC Issue of documented credits abroad
AFI.1 AFI.1 Advance on Italy invoices with
transfer of credit not notified to debtor
ALE.5 ALE.5 Advance of export lire on contract -
order confirmation
ALE.6 ALE.6 Advance of export lire on anticipated
future exports
ALE.7 ALE.7 Advance of export lire, loans for
financial transactions
ALI ALI Advance of import lire
API API Issue of documented credits, Italy
BIA.1A BIA.1A Short money with 48 hours notice
BIA.1B BIA.1B Short money on agreements
BIA.2 BIA.2 Issue of banker's acceptance
Only for lines of EDF.1 EDF.1 Advance of export currency on exports
credit for which made
the contract was EDF.2 EDF.2 Advance of export currency exports to
signed prior to be made
5/2/95 EDF.3 EDF.3 Advance of export currency with notice
to the debtor
EDF.4 EDF.4 Advance of export currency on contract
or order confirmation
EDF.5 EDF.5 Advance of export currency on
EDF.6 EDF.6 anticipated future export
Currency loan for financial
transactions (for lines of credit
contracted prior to 11/1/96)
loan in lire for financial transactions
(for lines of credit contracted on or
after 11/1/96)
FIT.2 FIT.2 Issue of sureties for Italy
FIT.3 FIT.3 Issue of sureties for abroad
IDF IDF Advance in import currency
ORO ORO Loan of fine gold
PRO.C COMMERCIAL AEE AEE Advance on bills in outstanding account
AFI AFI Advance on Italy invoices with debtor
notified of transfer of credit
ALE.1 ALE.1 Advance of export lire on exports made
ALE.2 ALE.2 Advance of export lire on exports to be made
ALE.3 ALE.3 Advance of export lire, Artigiancassa
refinancing
ALE.4 ALE.4 Advance of export lire with notice to
the debtor
<PAGE>
Only for lines of EDF.1 EDF.1 Advance of export currency on exports
credit contracted made
on or after 5/2/95 EDF.2 EDF.2 Advance of export currency to be made
EDF.3 EDF.3 Advance of export currency with notice
to the debtor
SBF.1 SBF.1 Advance on SBF bills
SBF.3 SBF.3 Advance on SBF bills in lire on foreign account
SCO SCO Discount on lire commercial paper, Italy
SLD SLD Discount on lire commercial paper, abroad
PRO.G GLOBAL All technical forms CDS Issue of simple over-the-counter credit
usable within the GAR Checking account line of credit secured
PRO.1 and PRO.C mixed by pledge on various valuables
lines GRE Checking account line of credit secured
by pledge on securities
-------------------------------------------------------------------------------------------------------------
</TABLE>
GENERAL TERMS OF CONTRACT FOR CASH CREDIT
Art. 1 SUBJECT
Cash credits granted by Banca Popolare di Bergamo - Credito Varesino
(hereinafter Bank), which are to be understood as revolving credits unless a
different written agreement is reached, are subject to the following general
terms of contract.
Use of cash credits is subject to the signing, where provided, of specific
forms created for this purpose and maintained for the Client's use, which also
contain special conditions in addition to these conditions, which will govern
use of aforementioned cash credits.
Art. 2 USES IN FOREIGN CURRENCY
In the event of uses in foreign currency, sums from exchange rate fluctuations
between the euro and the currency currently used also constitute use of the
line of credit.
Art. 3 GUARANTIES
Use of lines of credit is subject to completion of requested guaranties, where
applicable. Where the Client has created a collateral guaranty to back up cash
credit, and the value of the pledged assets and/or rights has for whatever
reason decreased compared to the pledge initially established, and the guaranty
has not been supplemented by other assets and/or rights agreeable to the Bank
(the Bank has deemed their value insufficient to permit continuation of the
granted credit), the Bank, except for the provisions below relating to
rescission, cancellation for non-performance, and cancellation of the time
limit in favor of the debtor, can proportionally reduce the credit, effective
immediately, by informing the client in writing.
Art. 4 SPECIFIC CONDITIONS FOR SPECIAL WAYS AND MEANS OF USE
4.1 Checking account cash credits. The Client may utilize the amount made
available to him in checking account cash credits one or more times and can,
through subsequent deposits, reestablish their availability.
4.2 Uses of endorsement credits. In the event of usable credits opened by the
Bank by issuing banker's acceptances and/or sureties and, in general, the
opening of "endorsement" credit, the cash credit is usable, at the Client's
discretion, a number of times on a rotating basis, after possible returns.
a. In the event of cash credit by issuing of banker's acceptances, the
Bank, at the Client's order, issues banker's acceptances by placing
its signature on bills drawn on it written by the Client, or by third
persons or bodies specified by the Client, on his order and with the
formal requirements provided by Article 10 B of the list of rates,
Annex A to Presidential Decree 26/10/72 no. 642, as subsequently
amended.
<PAGE>
b. In the event of cash credit by issuing of sureties, use by the Client
occurs by giving the Bank an order to issue guarantees in favor of
resident and non-resident individuals, directed at guaranteeing the
Client's or third party's specified obligations resulting from
transactions of any kind, according to the Client's demands from time
to time. "Surety" means any type of guaranty, unconditional and not
as an accessory to the main obligation, from any encumbered
contractual clause, whichever legal system, Italian or foreign, which
governs it by legal provision or by contract.
4.3 Uses for portfolio transactions. The bearer guarantees that the traded
portfolio was issued for normal commercial transactions. It is the Client's
right to deliver the portfolio using either a note on demand or by using
available telebanking instruments.
In the event of advance transactions under reserve recorded in the loan
account, unless the Client provides different and specific instructions, the
Bank is authorized on an ongoing basis to effect - up to the amount of the
available line of credit and in any case within the limit of the amount of
demands made - transfers from the loan account to the Client's regular checking
account.
4.3.1 Regarding demands for discounts and/or for reserve deposits. In the event
of cash credits usable for discount transactions and/or immediate crediting
under reserve, the Bank reserves the right to decline to execute transactions,
or to redebit the amount or to demand the amount of those already completed for
as-yet-unexpired notes, if during a prior check or at any time thereafter, it
is found that the withdrawers or withdrawees have been the subject of protest
or are shown to be the subject of legal action or queries entailing commercial
damage or discredit, or that they have not honored previous demands for
collection or discounted or credited deposits under reserve, or it is shown
that the assets of the withdrawers and/or withdrawees and/or co-debtors of the
portfolio already discounted or credited under reserve and not yet expired,
worsened subsequent to the discount or credit transaction under reserve.
The Client may use the respective amount one or more times in a revolving
fashion only when available assets have been created relating to:
- the applied currencies and/or the time normally required to return to
the Bank bills outstanding or dishonored, collection demands (subject
to S.E.I., Electronic Collection Service) which are outstanding or
which were not able to be debited to the debtor, or the debit was
cancelled on the debtor's order within the terms provided by
interbank procedure;
- the regulations which govern the collection services already signed
and accepted.
4.3.2 Regarding deposit for credit to outstanding account. In the event of cash
credits usable by depositing the portfolio to the outstanding account, the
Client, obviously within the limits of the granted credit, has the right to
demand one of the following operating conditions:
a) to utilize, after the Bank has determined the average values on the
regular checking account and in a currency which is legal tender in
Italy, by one or more debit orders, including revolving ones, the sum
equal to the total amount of the presented portfolio, within the
referenced average value.
In this event, the determination of the average value entails:
- simultaneous activation on the regular checking account or on a
special loan account, if it exists, of a number of lines of
credit (in addition to any others that already exist on the
regular checking account with which they will be combined) for a
total amount equal to the sum of the submitted portfolio, whose
expirations correspond to the determined average values.
- simultaneous crediting to the loan account of the amounts
relating to the submitted portfolio, with value corresponding to
the average determined values;
b) to utilize, immediately and independently of the referenced
determination, in the regular checking accounts, by ordering the
debiting, either once or on a revolving basis, of the amount equal to
the overall value of the presented portfolio, when and because it is
presented, within the scope of the referenced average value.
In this event, the demand of the portfolio in the loan account awaiting
the maturity of the average value entails:
- simultaneous activation of a line of credit in the same amount
on the regular checking account or on the special loan account,
if one exists, (in addition to any that already exist on the
regular checking account, with which they will be combined) for
a total amount equal to the sum of the submitted portfolio, with
provisional maturity established by agreement;
<PAGE>
- the provisional crediting to the loan account of the value of
the total amount of the demand established by agreement,
crediting to be identified by a special number;
Once the average values of the presented portfolio are determined, the
Bank will automatically generate the final accounting record using the
following transactions:
- debiting to the loan account the previously credited amount,
using the same value and identical numbering
- recrediting to the loan account the total amount with different
values, calculated on the basis of the average values of the
submitted portfolio.
The above-referenced recrediting entails the replacement of the previously
granted provisional line of credit with a final line of credit which will
balance down based on the amounts and the average values of the portfolio,
and which must be considered together with those which may already exist
on the account, to which it will be added.
The Client will be informed of the provisional accounting entries and the
final accounting entries by regular mail using specific, analytical charts
describing every accounting movement or movement of the line of credit.
c) The Client may also utilize in his regular checking account the
amounts concerned in the demand, effected only after the maturity of
the average values of the deposited bills.
4.3.3 Regarding submission for crediting to outstanding account the amount of
current lines of credit. The Client is granted the right to make verbal
requests to effect the deposit of bills in excess of the amount of the current
lines of credit to be charged against the loan account. In the event the Bank
agrees, it will inform the Client by registered letter of the increase in
credit line granted and consequently the new lines of credit and their terms.
4.4 Use for EDF.5 and EDF.6 loans. In the event of cash credit available for
use through types of loans, in currency which is legal tender in Italy or in
one or more currencies in the foreign exchange account, without prejudice to
the fact that, in the event of loans in foreign currency, available amounts are
subject to fluctuations in the euro/currency exchange rate, as are those
currently in use, the Client has the right to use the cash credit a number of
times, as well as a number times on a revolving basis, by individual loans in
currency which is legal tender in Italy or one or more currencies in the
foreign exchange account, each of which for the duration of no more than 12
months and in any case not longer than the term set down for the cash credit,
these individual loans may be renewed for a period equal to or less than the
original term by written request which must arrive at the Bank at least three
days prior to maturity.
At every request for use or renewal of same, the value of all existing usages
and that of the request may not exceed the amount of the cash credit for that
purpose, the value of the usages in foreign currency, expressed in whatever
currency, and represented by the equivalent in currency which is legal tender
in Italy, calculated at the exchange rate of the day on which the order was
made.
Art. 5 LATE PAYMENT
In the event of late payment of the amounts due, interest on arrears will be
charged quarterly at the last applied rate plus 2 percent.
Art. 6 MATURITY
If the cash credit is for a determined period, at its maturity the Client is
required to pay what he owes in terms of capital, interest, costs, duties,
taxes, and every other additional charge, even without an express request by
the Bank.
Art. 7 RESCISSION
The Client has the right to recede, at any time, from the cash credit by
effecting a closing transaction consisting of payment of what he owes. The Bank
has the right to recede at any time, also by verbal communication, although it
granted credit for a determined period, as well as to reduce or suspend it. The
Client will be given notice of no less than one day, by registered letter, to
pay what he owes.
If the Client qualifies as a consumer within the meaning of Art. 1469 2d. of
the Civil Code, the Bank has the right to recede from the cash credit or to
reduce it:
a) in the event of an open-ended cash credit, by resorting to a reason
with justification or with notice of not less than 15 days;
<PAGE>
b) in the event of a fixed-period cash credit, only by resorting to just
cause.
In any case, rescission may be communicated verbally, and for payment owed the
Client will be permitted a period of not less than 3 days, of which he will be
informed by registered letter.
Art. 8 EFFECTS OF REDEMPTION
In any case, rescission or any other reason for cancellation, termination, or
redemption of the cash credit will have the effect of immediately suspending
use of the granted credit. In the event of cash credit available for discount
transactions and/or transactions involving immediate crediting with reserve,
the Bank is authorized to demand the corresponding sum in the amount of the
bills and the discounts or credits with reserve which have not expired and/or
whose fate is unknown, this outcome having no bearing whatsoever, with respect
to payment demands made on the outstanding account, any maturity of the
corresponding average value. In the event of cash credits available for
endorsement, when events negatively impacting the Client's asset, financial, or
economic situation occur in such a way as to endanger recovery of the credit,
or in the event of a decrease in the guarantees made, the Bank reserves the
right to demand the amounts necessary to meet its obligations relating to
unexpired banker's acceptances and/or relating to sureties given, regardless of
whether they have been prosecuted or not. With regard to this right, the Bank
is irrevocably authorized to debit the Client's checking account for the credit
amounts claimed by the Bank.
In the event of cash credits available in currency on a currency account, the
Bank is also authorized to demand repayment of the funds currently in use.
Art. 9 OVERDRAFT DISPOSITIONS
Any dispositions for overdraft transactions, in any form in which they are
effected, which the Bank deems necessary to effect after the agreed maturity or
after communication of rescission does not entail restoring the cash credit for
the amount of the executed dispositions or transactions.
Any overdraft allowed, in whatever form, beyond the cash credit limit, does not
entail increasing said limit.
Art. 10 EXTENSIONS
The regulations as per Art. 7 REFERRAL and 8 EFFECTS OF REDEMPTION shall be
applied to every other credit or aid of any kind and under any form granted by
the Bank.
Art. 11 TERMINATION DUE TO NON PERFORMANCE AND CANCELLATION OF THE TIME LIMIT
IN FAVOR OF THE DEBITOR
If the Client fails to perform any of his obligations relating to the Bank, and
any of the hypothetical conditions provided by Art. 1186 of the Civil Code, the
cash credit ceases, effective immediately, and the Client, upon simple written
demand, must pay what he owes without delay.
Art. 12 JOINT LIABILITY
In the event that the cash credit is granted to two or more persons with the
right to use it separately as well, each of the borrowers is considered joint
and indivisible with respect to assignees on whatever basis, of everything owed
to the Bank.
Art. 13 CONTINGENT CHARGES
Any charge relating to taxes, duties and burdens of any type, direct or
indirect, present or future, is the exclusive responsibility of the Client.
Art. 14 COMMUNICATIONS
The sending of letters, any notifications and any other declaration or
communication to the Bank shall be made by the Client with full effect to the
address indicated in the document establishing the relations governed by this
document or subsequently communicated by registered letter.
Art. 15 AMENDING TERMS AND CONDITIONS
The Bank has the right to change the provisions of this contract at any time,
due to changes of law or other statutory, regulatory, administrative provisions
or provisions for reasons of supervision, safety and efficiency, as well as due
to any other justified reason. This shall be validly communicated by the Bank
in a
<PAGE>
simple letter to the Client's last indicated address and shall become
effective on the date indicated in said communication.
The Bank also reserves the right to change the economic conditions applied to
the relations governed by this contract, even in a sense unfavorable to the
Client, observing the provisions of Articles 118 and 161, paragraph 2, of the
Legislative Decree of September 1, 1993, no. 385 and their related implementing
provisions.
Art. 16 REFERRAL
For matters not expressly governed by these provisions, the general conditions
of contract applicable to checking accounts already signed and accepted by the
Client shall apply.
Art. 17 GOVERNING LAW AND COMPETENT FORUM
The relationships governed by this contract are subject to the Italian law.
Except in the event that the client falls under the category of Consumer for
the purposes of Art. 1469 2d. of the Civil Code, the forum of Bergamo has
jurisdiction over all disputes arising from this contract.
Pursuant to Art. 1341Civil Code, we declare our specific approval for the
following conditions above: Art. 3 immediate reduction of credit, Art. 4.3.1:
right to refuse execution of specific portfolio transactions; Art. 7: right of
rescission and obligation to restitution; Art. 8: provision of the amounts
relating to advancing unexpired credits, unenforced sureties, or other
unexpired signed commitments, current currency loans, termination of the line
of credit. Art. 15: changes of law and economic conditions, even in a sense
negative for the Client; Art. 17: competent forum.
We acknowledge your communication and declare to you our acceptance of the
contents of same.
Milano, 13/3/2000
--------------------------------
Place and date
Banca Popolare di Bergamo - Credito Varesino
/s/ De Agostini Alfredo
--------------------------------
De Agostini Alfredo
/s/ Vavassori Massimo
--------------------------------
Vavassori Massimo
<PAGE>
NORFIN VIA BISTOLFI, 35 - 20134 MILAN
ORONIZIO DE NORA GROUP TEL. (02) 21291 - FAX (02) 26312530
TELEX 310552 - 322231 ODENOR I
e-mail: [email protected]
BANCA POPOLARE DI BERGAMO
CREDITO VARESINO
Milan Office
Via Manzoni, no. 7
MILAN
ATT: Dr. Tramezzani
[stamp] COPY
Milan, March 6, 2000
Re: Increase in the DE NORA FUEL CELLS S.P.A. line of credit
Regarding the above-captioned matter, we are aware that DE NORA FUEL CELLS
S.P.A. has requested you to increase the line of credit called "flexible cash"
to 2,000,000,000 lire (two billion) and you have stated your willingness to
grant this request due to the fact that we hold the controlling interest in the
applicant.
As it is in our interest that this credit increase be granted, we hereby pledge
in this letter, as owners of the controlling interest in the above investment,
that DE NORA FUEL CELLS S.P.A. will meet all of its obligations arising from
the loan agreement in question, assuring you that it will repay these
obligations because we are providing them with the funds to do so.
Regarding the above, we hereby give you assurance that we will inform you in
advance should we plan to sell the majority interest in said company and should
this take place, or if for whatever reason, our investment should decrease
prior to the total redemption of these obligations by DE NORA FUEL CELLS
S.P.A., and should the company enter into receivership proceedings or be wound
up, we will provide for repayment in full upon simple written request and every
other objection raised to date, of everything owed to you by same, capital,
interest, including those in arrears, accessory and costs, up to the maximum
amount of 2,600,000,000 lire.
This matter is subject exclusively to Italian law. Competent forum is the Court
of Milan.
Very truly yours,
[stamp] RECEIVED [stamp] NORFIN S.p.a.
MARCH 7, 2000
/s/ Michele De Nora
--------------------------
Michele De Nora
Vice President and
Board Member
STOCK CORPORATION - CAPITAL STOCK: 37,500,000,000 LIRE (wholly paid-in) -
REGISTERED IN THE CORPORATE REGISTER, REGULAR SECTION AS NO. 203816 - R.E.A.
NO. 1063960 AT C.C.I.A.A., MILAN - TAX ID NO. 06036090152
<PAGE>
NORFIN VIA BISTOLFI, 35 - 20134 MILAN
ORONIZIO DE NORA GROUP TEL. (02) 21291 - FAX (02) 26312530
TELEX 310552 - 322231 ODENOR I
e-mail: [email protected]
BANCA POPOLARE DI BERGAMO
CREDITO VARESINO
Milan Office
Via Manzoni, no. 7
MILAN
ATT: DR. TRAMEZZANI
Milan, April 19, 2000
Re: Line of credit in the amount of 2,000,000,000 for
"DE NORA FUEL CELLS S.p.A."
To utilize the line of credit granted by you, with reference to the terms
of our patronage letter dated March 6, 2000, we wish to inform you that, as a
result of the noted transaction linked to the agreement between our group and
the American company Arthur D. Little (see press release printed last week in
the daily Milano Finanza), control of DE NORA FUEL CELLS S.p.A. is now joint.
However, considering the fact that we continue to hold the relative
majority (50%) of the referenced company, we would be grateful if you would
continue the existing line of credit. Trusting that you will agree.
Sincerely yours,
[stamp] RECEIVED [stamp] NORFIN S.p.a.
APR. 20, 2000
/s/ Mauro Saponelli
--------------------------
Mauro Saponelli
President
STOCK CORPORATION - CAPITAL STOCK: 37,500,000,000 LIRE (wholly paid-in) -
REGISTERED IN THE CORPORATE REGISTER, REGULAR SECTION AS NO. 203816 - R.E.A.
NO. 1063960 AT C.C.I.A.A., MILAN - TAX ID NO. 06036090152
