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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-K/ A

FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTION 13
OR

15(d) OF THE SECURITIES EXCHANGE ACT OF 1934




|     |                                                                                                                                       
|---- | --------------------------------------------------------------------------------------------------------------------------------------
|[X]  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE 
	 SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED 
	 DECEMBER 31, 2000
|    
|[  ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE 
	 SECURITIES EXCHANGE ACT OF 1934                                           

For the transition period from
            to

Commission file number 0-28040



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BACOU USA, INC.

(Exact name of registrant as specified in its
charter)


|                                                                |  |                                      
|--------------------------------------------------------------- |  | -------------------------------------
|                                                               
|                                                               
|                                                               
|                                                               
|Delaware                                                        |  | 05-0470688                           
|(State or other jurisdiction of
	incorporation or organization) |  | (I.R.S. Employer
	Identification No.)
|10 Thurber Boulevard, Smithfield, RI                            |  | 02917-1896                           
|(Address of principal executive offices)                        |  | (Zip Code)                           

Registrants telephone number, including area code:
(401) 233-0333

Securities registered pursuant to Section 12(b) of the
Act:

Title of each class: Common Stock, $.001 Par Value


Name of each exchange on which registered: New York Stock
Exchange

Securities registered pursuant to Section 12(g) of the
Act: None

Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding twelve
months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to
such filing requirements for the past
90 days.     Yes 
[X]     No  [  ]

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not
contained herein, and will not be contained, to the best of
registrants knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this
Form 10-K/A or any amendment to this
Form 10-K/A.  [X]

The aggregate market value of the voting common stock of the
registrant held by non-affiliates of the registrant computed on
the basis of $25.70 per share (the closing price of such stock
on April 20, 2001 on The New York Stock Exchange):
$130,138,761.

As of April 20, 2001, there were 17,676,365 shares of
Common Stock outstanding.



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|                                 |                                                                                               |  |  |  |  |  |  | 
|-------------------------------- | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I                          
|                                 | Item 1. Business                                                                             
|                                 | Item 2. Description of Properties                                                            
|                                 | Item 3. Legal Proceedings                                                                    
|                                 | Item 4. Submission of Matters to a Vote of Security Holders                                  
|PART II                         
|                                 | Item 5. Market for the Registrants Common Stock and Related Stockholder Matters             
|                                 | Item 6. Selected Financial Data                                                              
|                                 | Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                 | Item 7A. Quantitative and Qualitative Disclosures about Market Risk                          
|                                 | Item 8. Financial Statements and Supplementary Data                                          
|                                 | Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 
|PART III                        
|                                 | Item 10. Directors and Executive Officers of the Registrant                                  
|                                 | Item 11. Executive Compensation                                                              
|                                 | Item 12. Security Ownership of Certain Beneficial Owners and Management                      
|                                 | Item 13. Certain Relationships and Related Transactions                                      
|                                 | Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K                     
|                                 | Item 14(a) 2.Financial Statement Schedules Financial Statement Schedule II                   
|Exhibit 23  Consent of KPMG  LLP



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|           |          |             |                                                                                        |             |  |    | 
|---------- | -------- | ----------- | -------------------------------------------------------------------------------------- | ----------- |  | -- | 
|           |          | Description |                                                                                        | Page Number
|           |          |             |                                                                                        |            
|PART I     |          |             |                                                                                        |             |  |   
|          
|          
|          
|          
|           | Item  1  |             | Business                                                                               |             |  | 3  | 
|          
|          
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|          
|           | Item  2  |             | Properties                                                                             |             |  | 11 | 
|          
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|          
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|           | Item  3  |             | Legal Proceedings                                                                      |             |  | 13 | 
|          
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|           | Item  4  |             | Submission of Matters to a Vote of Security Holders                                    |             |  | 13 | 
|PART II    |          |             |                                                                                        |             |  |   
|          
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|           | Item  5  |             | Market for the Registrants Common Stock and Related
	Stockholder Matters              |             |  | 13 | 
|          
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|           | Item  6  |             | Selected Financial Data                                                                |             |  | 13 | 
|          
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|           | Item  7  |             | Managements Discussion and Analysis of Financial Condition
	and Results of Operations |             |  | 15 | 
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|           | Item  7A |             | Quantitative and Qualitative Disclosures About Market Risk                             |             |  | 22 | 
|          
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|           | Item  8  |             | Financial Statements and Supplementary Data                                            |             |  | 23 | 
|          
|          
|          
|          
|           | Item  9  |             | Changes in and Disagreements with Accountants on Accounting and
	Financial Disclosure  |             |  | 40 | 
|          
|PART III   |          |             |                                                                                        |             |  |   
|          
|          
|          
|          
|           | Item  10 |             | Directors and Executive Officers of the Registrant                                     |             |  | 40 | 
|          
|          
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|           | Item  11 |             | Executive Compensation                                                                 |             |  | 42 | 
|          
|          
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|          
|           | Item  12 |             | Security Ownership of Certain Beneficial Owners and Management                         |             |  | 48 | 
|          
|          
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|           | Item  13 |             | Certain Relationships and Related Transactions                                         |             |  | 49 | 
|          
|PART IV    |          |             |                                                                                        |             |  |   
|          
|          
|          
|          
|           | Item  14 |             | Exhibits, Financial Statement Schedules and Reports on
	Form  8-K                      |             |  | 52 | 
|          
|          
|          
|          
|Signatures |          |             | 57                                                                                     |            




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NOTE: This Form 10-K/ A filed with the Commission on
April 26, 2001 amends and restates Items 10 through 13
included in our Annual Report on Form 10-K previously filed
and makes certain other conforming changes.







PART I




Item 1.  Business

General

Bacou USA, Inc. (Bacou, we,
our or us, as applicable) designs,
manufactures and sells safety products that protect the sight,
hearing, hands and respiratory systems of workers against
occupational hazards, as well as related instrumentation
including gas monitors and test equipment for self-contained
breathing apparatus. We sell safety products that are marketed
under the brand names Biosystems, Howard Leight®,
Lase-R Shield, Perfect Fit, Pro-Tech®,
Survivair®, uvex® and Whiting+Davis®,
principally to industrial safety and fire service distributors.
We also design, manufacture and sell optical products under the
Titmus® brand name, including eyeglass frames and
components which we sell principally to optical laboratories,
and vision screening equipment.

Recent Developments

Strategic Review

We announced on July 10, 2000 that both we and our majority
shareholder, Bacou S.A., would engage investment bankers to
explore strategic alternatives to enhance value for our
respective shareholders. Bacou S.A. owns 12.6 million shares, or
approximately 71.4%, of Bacou USA and is controlled by four
members of the Bacou family (Bacou Family). In the
event of a sale by the Bacou Family of its direct and indirect
interests in Bacou S.A., a buyer also would own indirectly the
12.6 million shares of Bacou USA that are held by Bacou S.A.,
thereby obtaining indirect control of Bacou USA.

Walter Stepan, a Director and Co-Chairman of Bacou USA, former
President and CEO of Bacou USA and a Director of Bacou S.A., was
selected to lead the internal task force on behalf of both
companies to evaluate our strategic alternatives together with
investment bankers.

On July 14, 2000, we announced that Bacou USA and the Bacou
Family had engaged Deutsche Bank Securities as financial advisor
in connection with this review of strategic alternatives. At the
same time, we announced an agreement with the Bacou Family that
any offer for their interests in Bacou S.A. also would contain
an undertaking to purchase the shares of the minority
stockholders of Bacou USA and that any such purchase would be on
substantially similar terms as those applicable to any sale by
the Bacou Family of their indirect interests in Bacou USA. Terms
of the agreements with Deutsche Bank Securities and the Bacou
Family were detailed in a Form 8-K filing with the
Securities and Exchange Commission on July 14, 2000. In
addition, we have retained the investment banking firm of
PaineWebber Incorporated (now known as UBS Warburg) to provide
advice to the Oversight Committee of the Board of Directors
regarding the fairness of any consideration offered to the
minority public shareholders of Bacou USA.

At the time of our announcement on July 14, we expected a
decision to be reached, and any resulting transaction to be
consummated, at the end of 2000 or the beginning of 2001. In
December 2000, we announced that the process would continue
into 2001. In February 2001, Bacou USA announced that the
review of strategic alternatives was ongoing but was not
expected to be concluded (nor any transaction consummated)
during the first quarter of 2001. The process is still ongoing,
and the outcome of the review cannot be determined at this time.
Moreover, there can be no assurance that any transaction will
result from the review of strategic alternatives and if
achieved, when such transaction would be consummated.

National Economic Conditions

During the first quarter of 2001, leading economic indicators
have pointed to a slowdown in the United States economy. A
number of manufacturing companies and other businesses,
including some companies that

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Segment Information

We have three reportable segments  the safety
segment, the glove segment and the optical frames and
instruments segment. The safety segment includes consumable
products (protective eyewear and hearing protection) and
technical products (respirators and gas monitors), all of which
we sell principally to industrial safety distributors and, to a
lesser extent, fire safety distributors. We began reporting a
glove segment in connection with our April 1, 1999
acquisition of Perfect Fit Glove Co., Inc. and certain
affiliates (Perfect Fit). Glove segment products
include cut- and abrasion-resistant gloves, protective sleeves,
liquid-proof gloves and metal mesh gloves and apparel, which we
sell principally to industrial safety distributors. The optical
frames and instruments segment includes eyeglass frames and
components, and vision screening equipment. We sell eyeglass
frames and components principally to optical laboratories, which
fit frames with prescription lenses to create completed eyewear
products.




You can find financial information about each of our segments
and sales in geographical areas in Note 10 to our
Consolidated Financial Statements included in Item 8 of
this Form 10-K/A




Products  Safety Segment

Protective Eyewear

We sell uvex® brand non-prescription protective
eyewear in a wide variety of styles of spectacles and goggles.
All Uvex products have polycarbonate lenses that provide an
impact-resistant barrier. The lenses are protected by
proprietary coatings, which provide superior resistance to
scratches and fogging. We also sell application-specific
protective eyewear, including laser protective eyewear under the
uvex®, LaserVision and Lase-R Shield
brands.

Hearing Protection

We sell a full range of Howard Leight® brand hearing
protection products that reduce the risk of long-term hearing
loss from exposure to excessive noise levels. These products
include disposable and reusable ear plugs, corded ear plugs,
banded ear plugs and ear muffs. Additionally, we sell Howard
Leight® brand ear plug dispensers for easy distribution of
ear plug products to workers.

Air Purifying Respirators and Supplied Air
Respirators

We sell a complete line of reusable half mask and full-face mask
air purifying respirators under the Survivair® and
Pro-Tech® brand names, as well as hazard specific
cartridges and filters for removing various contaminants from
the air. We also sell Survivair® brand self-contained
breathing apparatus for industrial and fire protection
applications, as well as air line respirators. Supplied air
respirators provide an independent source of breathable air for
workers in atmospheres immediately dangerous to their lives or
health.

Gas Detectors and Test Equipment for
Self-Contained Breathing Apparatus

We sell Biosystems brand gas monitors and gas detectors,
which sense and report levels of certain gases in the atmosphere
of work sites and identify hazardous conditions. We also sell
PosiChek brand test-benches, which are computer
controlled, automatic testing systems that dynamically evaluate
the proper performance of self-contained breathing apparatus.

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Products  Glove Segment

We sell Perfect Fit brand cut- and abrasion-resistant
gloves, protective sleeves, MAPA Professional brand liquid-proof
gloves and Whiting+Davis® brand metal mesh gloves and
apparel, which products are sold primarily to industrial safety
distributors.

Products  Optical Frames and Instruments
Segment

We sell Titmus® brand metal and plastic eyeglass frames and
components for prescription protective eyewear. These products
accommodate corrective lenses and, when completed with
appropriate lenses, meet the standards for protective eyewear.
We sell Titmus® brand occupational vision screening
equipment that is used to determine whether an eye exam should
be administered for prescribing corrective lenses.

Backlog

We had a total backlog of approximately $11.3 million at
December 31, 2000 and $10.3 million at December 31,
1999. We expect to fill all orders outstanding at
December 31, 2000 during 2001.

Seasonality

Our business has been subject to slight seasonal variations,
which we have attributed to fluctuations in industrial activity
and annual weather patterns. Historically, our sales from
November through February have been somewhat lower than other
periods due to anticipated lower demand in the more inclement
winter months and planned inventory reductions by major
distributors.

Marketing, Sales and Distribution

We sell our safety products principally through industrial
safety distributors. Additional channels of distribution differ
by product line. Laser protective eyewear products are sold in
markets serving medicine, industry, research laboratories and
universities, and worldwide by laser manufacturers as
accessories with their products. Fire service distributors sell
Survivair® brand self-contained breathing apparatus and
Biosystems brand gas detectors and test equipment for
self-contained breathing apparatus. Perfect Fit cut- and
abrasion-resistant gloves and sleeves, MAPA Professional
liquid-proof gloves and Whiting+Davis® metal mesh gloves
and apparel are also sold to companies in the meat packing,
poultry, and food processing industries. We market
uvex®, Howard Leight® and Pro-Tech® brand
products in the do-it-yourself retail markets for home safety
products. We also sell Howard Leight® brand products in the
sport shooting and law enforcement markets. Optical laboratories
and optical retailers are the main channels for distribution of
Titmus® brand eyeglass frames and components for
prescription protective eyewear. We market all of our products
internationally, with uvex® brand products
contractually limited to distribution in North, South and
Central America. The sale of our products to purchasers in
France is restricted under a corporate opportunities agreement
with Bacou S.A., the principal stockholder of Bacou USA, Inc.

Manufacturing Operations

Protective Eyewear

We use a highly automated injection molding process to
manufacture the frames and lenses of our uvex® brand
non-prescription protective eyewear at our Uvex Safety
Manufacturing, Inc. (USM) facility. We mold frame
components in nylon, propionate and polyvinylchloride, and we
mold our lenses from polycarbonate resin pellets. We operate a
highly automated, integrated assembly and packaging system for
our safety eyewear products, such as the astrospec® 3000
family of products and other high-volume products.

Disposable and Reusable Ear Plugs and Ear
Muffs

We manufacture earplug products at our Howard Leight Industries
(HLI) facility using proprietary, high volume
automated machinery and equipment which mold polyurethane foam
and polyvinylchloride into earplugs. We use injection molding to
produce head bands for banded earplug products and ear muff
bodies.

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Air Purifying Respirators and Supplied Air
Respirators

We manufacture respirator bodies, cartridge and filter bodies,
and certain other parts using injection and compression molding
techniques at our Survivair facility. We produce most of our
metal regulator parts using computer-assisted machining
operations. We assemble finished respirators using these
manufactured parts and components manufactured by outside
vendors. Cartridges and filters for air purifying respirators
are filled using high-speed, automated folding, filling and
sealing machines.

Gas Detectors and Test Equipment for
Self-Contained Breathing Apparatus

We assemble gas detection products and test equipment for
self-contained breathing apparatus at our Biosystems facility
using component parts manufactured by outside vendors. Component
parts are requisitioned using a just-in-time approach, and
material tracking is based on a work-in-process inventory
management system and electronically initiated inventory
replenishment. We utilize work cells for assembly of these
products.

Protective Gloves, Sleeves and Apparel

We manufacture four types of seamless knit gloves and woven
cloth material at our SCHAS Industries, LLC (SCHAS)
facility where knitting machines produce glove shells and the
finishing department sews a hem at the bottom of the wrist
portion of each glove to prevent unraveling. We then transport
these gloves to Perfect Fit where our coating operations apply
an oil-based plastisol liquid to the gloves, which are then put
through an automated printing and drying process. The Perfect
Fit sewing department also produces cotton and Kevlar®
tubular sleeves that individual users wear on their arms to help
prevent cuts, burns and abrasions.

We manufacture metal mesh gloves and apparel at our
Whiting+Davis, Inc. facility where high-speed custom built
machinery cuts and forms stainless steel and titanium wire into
U-shaped staples. These rings are placed
side-by-side and then forged into a circle shape that is then
welded. These rings are formed into sheets of interlocked rings
and are patterned for gloves, sleeves, aprons or tunics. The cut
patterns are assembled on semiautomatic machines that join seams
by inserting a U form into mating seam rings,
closing the form after insertion and then welding the completed
ring.

Eyeglass Frames and Components and Vision
Screening Equipment

We manufacture certain Titmus® brand eyeglass frames and
components for prescription protective eyewear in both metal and
plastic at our Titmus Optical, Inc. (Titmus)
facility. Metal products are made from wire in a process that
includes cutting, bending, shaping, soldering, plating and
colorizing. Our computer controlled milling operation produces
plastic products. We assemble vision screening equipment using
component parts manufactured by outside vendors.

Raw Materials

Although we rely primarily on single sources for the supply of
several raw materials, all of our raw materials are currently
readily available. We currently satisfy substantially all of our
requirements for (i) polycarbonate resin (the primary raw
material used in the production of non-prescription optical
lenses), (ii) polyurethane pre-polymer (the primary raw
material for production of foam hearing protection products) and
(iii) certain sensors (the primary component of gas
detection equipment) through single sources of supply. The loss
of any single source for supply of raw materials, any disruption
in such sources business or its failure to meet our needs
on a timely basis could cause shortages in raw materials and
could have a material adverse effect on our business, financial
condition or results of operations. Although we have plans in
place to deal with such contingencies, there can be no assurance
that such precautions will be adequate or that alternative
sources of supply can be located or developed in a timely manner.

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Principal Customers

We had no individual customers that accounted for 10% or more of
consolidated net sales in 1998, 1999 or 2000. However, the loss
of any of our principal customers could have a material adverse
effect on our operations and financial condition.

Competition

The personal protective equipment industry is highly fragmented,
with industry participants ranging in size from small companies
focusing on single types of personal protective equipment, to
several large multinational corporations which manufacture and
supply many types of personal protective equipment. We believe
that participants in the personal protective equipment industry
compete primarily on the basis of product characteristics (such
as design, style, fashion and functional performance), brand
name recognition, service and price.

The Uvex astrospec® family of eyewear products has enjoyed
significant success, resulting in many competitive copies of our
products that are manufactured overseas, imported to the United
States and sold at lower prices than comparable
uvex® brand products. Although we have taken steps
to introduce new, lower-priced products to compete in that
market segment, copies of our astrospec products may continue to
enjoy success in the marketplace against the astrospec family of
eyewear products. We have taken steps, including litigation, to
deter infringers from violating our patent rights.

To maintain our market position, we must be competitive in the
area of brand image, distribution, design, style, customer
service, quality and price. Individual competitors have
advantages and strengths in different sectors of the industry,
in different products and in different areas, including
manufacturing and distribution systems, geographic market
presence, customer service and support, breadth of applications,
delivery time and price. There can be no assurance that we will
be able to compete successfully against current and future
competitors or that the competitive pressures we face will not
adversely affect our financial condition or operations.

Intellectual Property

Our policy is to protect our intellectual property through a
range of measures, including trademarks, patents and
confidentiality agreements. We protect these rights by filing
applications for and registering trademarks and patents whenever
such filings would provide greater protection than maintaining
such information as trade secrets.

We have the right to use the trademark uvex® in
connection with protective eyewear and other safety products in
all countries in North, Central and South America. Uvex Sports
GmbH & Co. KG and Uvex Arbeitsschutz GmbH (together with
their affiliates, Uvex Germany) have the right to
use the uvex® name in connection with sports
products throughout the world and with personal protective
equipment products in countries outside of North, Central and
South America. Pursuant to our agreement with Uvex Germany, we
may sell personal protective equipment under the
uvex® brand name only in North, Central and South
America. The agreement also prohibits us from selling sports
products, such as sunglasses or protective eyewear for sport
activities, under the uvex® brand name regardless of
geographic area.

We also own a number of other patents and trademarks as a result
of the acquisitions of Uvex Safety, Inc., Titmus Optical, Inc.,
Survivair, Inc., Lase-R Shield, Inc., Biosystems, Inc., Howard
S. Leight & Associates, Inc., Perfect Fit Glove Co., Inc.
and Whiting+Davis Safety. The Survivair® name is registered
in the United States, Canada and Mexico and thirteen other
countries in Europe and South America. The Biosystems
PosiChek product has received patent protection in the
United States. The Leight name and numerous other
product names associated with Howard Leight are registered in
the United States. Our Titmus subsidiary owns numerous
trademarks under the Titmus® name for many of its products
in the United States and throughout the world. Perfect Fit is
licensed by DuPont to use the Kevlar® name on, and to
utilize yarn made from Kevlar® fiber in, its products. The
Whiting+Davis® name is registered in the United States.

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We also rely upon unpatented trade secrets for the protection of
certain intellectual property rights. We protect our trade
secrets by requiring certain of our employees, consultants and
other suppliers, customers, agents and advisors to execute
confidentiality agreements upon the commencement of employment
or other relationship with us. These agreements provide that all
confidential information developed by or made known to the
individual or entity during the course of their relationship
with us is to be kept confidential and not disclosed to third
parties except in certain specified circumstances. There can be
no assurance, however, that these agreements will provide
meaningful protection for our proprietary information or
adequate remedies in the event of the unauthorized use or
disclosure of such information. In addition, we can offer no
assurance that others will not independently develop
substantially equivalent proprietary information and
technologies, otherwise gain access to our trade secrets or
disclose such technology or that we can meaningfully protect our
rights to unpatented trade secrets. Further, we can offer no
assurance that infringement or invalidity claims will not be
asserted against us in the future. The costs of defending such
claims, or an unfavorable determination with respect to
litigation based on such claims, could have a material adverse
effect on our business and financial condition.

Environmental Matters

We are subject to federal, state and local environmental laws,
regulations and ordinances that (i) govern activities or
operations that may have adverse environmental effects (such as
emissions into the air, discharges into the water, and the
generation, handling, storage and disposal of solid and
hazardous wastes) or (ii) impose liability for the costs of
cleanup or other remediation of contaminated property, including
damages from spills, disposals or other releases of hazardous
substances or wastes, in certain circumstances without regard to
fault. Our manufacturing operations routinely involve the
handling of chemicals and wastes, some of which are or may
become regulated as hazardous substances. We have not incurred,
and do not expect to incur, any significant expenditures or
liabilities for environmental matters. As a result, we believe
that our obligations to comply with environmental regulations
will not have a material adverse effect on our business or
financial condition.

Employees

At December 31, 2000, we employed 2,460 people on a
full-time basis. Approximately 91 employees comprise a
bargaining unit represented by the United Steelworkers of
America (AFL-CIO-CLC) at our Titmus facility under a contract
which was renewed on September 14, 2000 and runs for a
period of two years. Approximately 85 employees comprise a
bargaining unit represented by the United Steelworkers of
America at our Whiting+Davis facility under a contract which
runs until March 6, 2003. We consider the relationship with
our employees to be good and we have not experienced any work
stoppages.

Government Regulation and Industrial Standards

Government regulation mandating the use of personal protective
equipment for certain job classifications and work site
environments is the most significant factor in the creation and
continuation of demand for personal protective equipment in the
United States. The Occupational Safety and Health Administration
(OSHA) generally regulates workplace environments in
the United States in which personal protective equipment must be
worn and specifies the standards that such equipment must meet.
Other United States governmental agencies further regulate the
use of personal protective equipment and issue standards
concerning the design and functionality of such equipment. We
believe we comply in all material respects with the regulations
and standards of these agencies.

Certain regulatory agencies in the United States and Canada each
mandate that our products meet performance standards established
by private groups, such as the American National Standards
Institute (ANSI) and the Canadian Standards
Association (CSA), respectively. Our safety eyewear
products are subject to the latest applicable standards, which
currently include ANSI Standard Z87.1-1989 and CSA
Standard Z94.3-1992. These standards require that
protective eyewear be tested for optical performance,
penetration, high velocity impact, high mass impact and other
integral product performance features. We maintain and operate
on-site testing labs at our Smithfield, Rhode Island and
Petersburg, Virginia facilities

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OSHA specifies that respiratory protection products must meet
application-specific performance standards that are set by
NIOSH. In addition, many respiratory products require approval
by the National Fire Protection Association. In order to achieve
regulatory approval, we maintain and operate an on-site lab at
our Santa Ana, California facility that is equipped to conduct
most necessary tests.

Executive Officers of Bacou

The names, positions, ages and business experiences during the
past five years of the executive officers of Bacou and its
principal subsidiaries or divisions, as of March 20, 2001,
are set forth below:

|                   |  |                                                                                                                                                                                                                                  |  |     |    | 
|------------------ |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --- | -- | 
|Name               |  | Position with the Company                                                                                                                                                                                                        |  | Age
|                   |  |                                                                                                                                                                                                                                  |  |    
|Walter Stepan      |  | Co-Chairman. Chairman of Bacou USA Safety, Inc. (Bacou
	Safety), Perfect Fit and Titmus                                                                                                                                        |  |     | 62 | 
|                  
|                  
|                  
|                  
|Philip B. Barr     |  | President and Chief Executive Officer (CEO). Vice
	Chairman of Bacou Safety, Vice Chairman and CEO of Perfect Fit
	and Titmus, Chairman and CEO of Platinum Protective Products,
	Inc. (Platinum) and SCHAS, Chairman of USM |  |     | 49 | 
|                  
|                  
|                  
|                  
|Luis Alvarez       |  | Vice President and General Manager of the HLI division of Bacou
	Safety                                                                                                                                                          |  |     | 40 | 
|                  
|                  
|                  
|                  
|Harvey I. Aronoff  |  | Vice President-Manufacturing of Bacou Safety                                                                                                                                                                                     |  |     | 58 | 
|                  
|                  
|                  
|                  
|John J. Bell       |  | President of Survivair division of Bacou Safety. Executive Vice
	President (EVP) of Bacou Safety                                                                                                                               |  |     | 55 | 
|                  
|                  
|                  
|                  
|Alan H. Bennett    |  | Chief Operating Officer (COO). President and CEO of
	Bacou Safety and USM; President of the Uvex Safety division of
	Bacou Safety; COO of Perfect Fit, Platinum, SCHAS and Titmus                                              |  |     | 58 | 
|                  
|                  
|                  
|                  
|Jeffrey T. Brown   |  | Vice President-Financial Reporting, Chief Accounting Officer,
	Treasurer and Assistant Secretary                                                                                                                                 |  |     | 41 | 
|                  
|                  
|                  
|                  
|John F. Burt, Jr.  |  | President of Biosystems division of Bacou Safety. EVP of Bacou
	Safety                                                                                                                                                           |  |     | 58 | 
|                  
|                  
|                  
|                  
|Thomas J. Goeltz   |  | President of Titmus                                                                                                                                                                                                              |  |     | 57 | 
|                  
|                  
|                  
|                  
|Adrien W. Hebert   |  | Vice President-Finance and Chief Financial Officer                                                                                                                                                                               |  |     | 50 | 
|                  
|                  
|                  
|                  
|Barry J. Kadets    |  | Vice President-Information Systems and Chief Information Officer                                                                                                                                                                 |  |     | 57 | 
|                  
|                  
|                  
|                  
|Winfield W. Major  |  | General Counsel, Secretary and Assistant Treasurer                                                                                                                                                                               |  |     | 53 | 
|                  
|                  
|                  
|                  
|John P. Montigny   |  | Vice President-Marketing of Bacou Safety                                                                                                                                                                                         |  |     | 38 | 
|                  
|                  
|                  
|                  
|Harry D. Neff, II  |  | Senior Vice President-Sales of Bacou Safety (with responsibility
	for Uvex Safety and HLI sales force)                                                                                                                           |  |     | 54 | 
|                  
|                  
|                  
|                  
|Frank A. Stucke    |  | President of Perfect Fit, SCHAS and Platinum                                                                                                                                                                                     |  |     | 45 | 
|                  
|                  
|                  
|                  
|Steven P. Tolisano |  | Vice President-Corporate Compliance                                                                                                                                                                                              |  |     | 51 | 

9



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##### Table of Contents



Officers are elected annually by the Board of Directors of the
respective entity and serve at the discretion of each such Board.

Mr. Stepan has been Co-Chairman since May 1999. He
served as Vice Chairman from February 1995 to May 1999
and as President and CEO from February 1995 to
December 1999. Mr. Stepan served as President and CEO
of Uvex Safety, Inc. and its predecessors from 1988 until
December 1997 when Uvex Safety was merged into Bacou
Safety, of which Mr. Stepan became Chairman, President and
CEO from January 1998 until December 1999 and remains
as Chairman. He was Chairman of USM from January 1998
through December 1999. Mr. Stepan has been Chairman of
Titmus since September 1995, Chairman of Perfect Fit since
April 1999 and was Chairman of SCHAS from April 1999 until
December 1999. Mr. Stepan is a Director of Bacou S.A.
and its affiliate, Bacou Industrial & Trading (Shanghai)
Co., Ltd. He is a Director of Uvex Safety Australia Pty Ltd. and
Uvex (UK) Limited, joint ventures among Uvex Germany, Bacou
International B.V. (an affiliate of Bacou S.A.) and Bacou
USA.

Mr. Barr has been President and CEO of Bacou since
January 2000. He served as Executive Vice President from
October 1996 until December 1999 and as COO from
February 1999 through December 1999. He was Vice
President of Bacou from August 1995 until October 1996
and served as Chief Financial Officer and Secretary of Bacou
from August 1995 until May 1999, and as Treasurer of
Bacou from August 1995 until June 1998. He has served
as Vice Chairman of Bacou Safety since December 1997. He
has been Vice Chairman of Titmus since 1995 and is currently
Vice Chairman and CEO. He served as Vice Chairman of USM from
December 1997 until December 1999 and is currently
Chairman. He has served as Vice Chairman of Perfect Fit since
April 1999 and was Vice Chairman of SCHAS from
April 1999 through December 1999. He currently serves
as CEO of Perfect Fit and as Chairman and CEO of Platinum and
SCHAS.

Mr. Alvarez has served as Vice President and General
Manager of HLI since January 24, 2000. Prior to that time,
he served as Director of Operations/ Manufacturing for
McGladrey & Pullen, LLP, a manufacturing consultant
group, from April 1997 to January 2000 and as General
Manager of Day Runner Inc., a manufacturing company, from
October 1994 to March 1997.

Mr. Aronoff has served as Vice President-Manufacturing of
Bacou Safety since January 1, 2000. Prior to that time, he
was President and CEO of HIA & Associates, Inc., a
management consulting and industrial engineering firm, from 1983
to December 1999, in which capacity he performed
manufacturing consulting work for Bacou.

Mr. Bell has been President of Survivair since
May 1997 and of its predecessor company, Survivair, Inc.,
since 1992. He has served as Executive Vice President of Bacou
Safety since May 1998.

Mr. Bennett has been COO of Bacou since January 2000.
He was Executive Vice President of Bacou Safety from
February 1999 to December 1999 and has served as
President and CEO since January 2000. He serves as COO of
Perfect Fit, Platinum, SCHAS and Titmus and as President and CEO
of USM. Prior to his employment with Bacou, he was a business
consultant from 1995 to 1998 and served as President of Safety
Supply America division of Figgie International from 1989 to
1994.

Mr. Brown has been Vice President-Financial Reporting and
Assistant Secretary since May 1999. He served as Director
of Corporate Reporting from May 1998 until May 1999 and has
been Treasurer since May 1998. He served as Corporate
Controller from August 1995 until May 1998 and has
been Chief Accounting Officer of Bacou since August 1995.

Mr. Burt founded Biosystems, Inc. in 1981 and served as
President of that company until its merger into Bacou Safety in
March 1998. He has been President of the Biosystems
division of Bacou Safety since that date. He has served as
Executive Vice President of Bacou Safety since May 1998.

Mr. Goeltz has served as President of Titmus since
April 1999. He was Senior Vice President-Sales of Titmus
from January 1997 until April 1999 and was Vice
President-Sales & Marketing from January 1993 until
January 1997.

Mr. Hebert has served as Vice President-Finance and Chief
Financial Officer since May 1999. He served as Vice
President-Finance and Corporate Controller from May 1998
until May 1999. He was Manager of

10



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##### Table of Contents





Mr. Kadets has served as Vice President-Information Systems
since March 2000 and as Chief Information Officer since
May 1997. Prior to joining Bacou, he served as Chief
Information Officer of Encore Computer, Inc. from January 1990
through February 1997.

Mr. Major has served as General Counsel since
June 1998 and as Secretary and Assistant Treasurer since
May 1999. From 1994 to 1998 he was Counsel to the law firm
of Edwards & Angell, LLP, our primary outside counsel.

Mr. Montigny has been Vice President-Marketing of Bacou
Safety since April, 2000. Prior to that time, he served as Brand
Manager for Titleist Golf Balls in the Acushnet Golf Products
Division of Fortune Brands, Inc. from 1996 to April, 2000.

Mr. Neff has been Senior Vice President-Sales for Bacou
Safety since January 1998. He served as Senior Vice
President-Sales of Uvex Safety since 1997 and as Vice
President-Sales from 1992 until 1997.

Mr. Stucke has served as President of Perfect Fit since
January 2001 and as President of SCHAS and its predecessors
since October 1997. He was Executive Vice President of
Perfect Fit and its predecessors from November 1983 through
December 2000.

Mr. Tolisano has served as Vice President-Corporate
Compliance since May 1999. He served as Vice President of Uvex
Safety, Inc. from October 1994 to December 1997 when
it was merged into Bacou Safety. He served as VP Finance of the
Uvex Safety division of Bacou Safety from January 1998
until April 1999.




Item 2.  Description of Properties

The following table sets forth the location of the facilities
that Bacou owns or leases, the square footage and the principal
function of each such facility. All facilities are used for the
safety segment other than the Petersburg, Virginia facility,
which is used for the optical frames and instruments segment and
the Cheektowaga, New York, Wilkesboro, North Carolina and
Attleboro Falls, Massachusetts facilities, which are used for
the glove segment.

|                         |  |                |         |          |  |                                                         |  |                                                                                                                                                                                                         
|------------------------ |  | -------------- | ------- | -------- |  | ------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                         |  | Approximate    |         | Owned or |  |                                                        
|Location                 |  | Square Footage |         | Leased   |  | Function                                               
|                         |  |                |         |          |  |                                                        
|Smithfield, Rhode Island |  |                | 170,000 |          |  | Owned (subject to encumbrance by bond financing agency) |  | Corporate headquarters; manufacturing, assembly, warehouse and
	distribution facility for protective eyewear products                                                                                   
|                        
|                        
|                        
|                        
|San Diego, California    |  |                | 100,000 |          |  | Owned                                                   |  | Manufacturing, assembly, warehouse and distribution for hearing
	protection products                                                                                                                    
|                        
|                        
|                        
|                        
|Tijuana, Mexico          |  |                | 50,000  |          |  | Leased                                                  |  | Manufacturing and assembly facilities for hearing protection and
	respiratory products                                                                                                                  
|                        
|                        
|                        
|                        
|Petersburg, Virginia     |  |                | 130,000 |          |  | Owned                                                   |  | Manufacturing, assembly, warehouse and distribution facility for
	eyeglass frames and components and vision screening equipment in
	115,000  sq. ft. with 2nd floor of building leased to
	a third party
|                        
|                        
|                        
|                        
|Cheektowaga, New York    |  |                | 100,000 |          |  | Owned                                                   |  | Manufacturing, assembly, warehouse and distribution facility for
	protective gloves                                                                                                                     

11



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##### Table of Contents



|                               |  |                |         |          |  |          |  |                                                                                                         
|------------------------------ |  | -------------- | ------- | -------- |  | -------- |  | --------------------------------------------------------------------------------------------------------
|                               |  | Approximate    |         | Owned or |  |         
|Location                       |  | Square Footage |         | Leased   |  | Function
|                               |  |                |         |          |  |         
|Cheektowaga, New York          |  |                | 80,000  |          |  | Leased   |  | Warehouse and distribution facility for protective gloves                                               
|                              
|                              
|                              
|                              
|Wilkesboro, North Carolina     |  |                | 115,000 |          |  | Leased   |  | Manufacturing, warehouse and distribution facilities for
	protective gloves                             
|                              
|                              
|                              
|                              
|Santa Ana, California          |  |                | 93,000  |          |  | Leased   |  | Manufacturing, assembly, warehouse and distribution facility for
	respiratory protection products       
|                              
|                              
|                              
|                              
|Middletown, Connecticut        |  |                | 45,000  |          |  | Leased   |  | Assembly, warehouse and distribution facility for gas monitors                                          
|                              
|                              
|                              
|                              
|Smithfield, Rhode Island       |  |                | 32,000  |          |  | Leased   |  | Warehouse for protective eyewear products                                                               
|                              
|                              
|                              
|                              
|Attleboro Falls, Massachusetts |  |                | 36,000  |          |  | Leased   |  | Manufacturing, assembly, office, warehouse and distribution
	facility for metal mesh protective products
|                              
|                              
|                              
|                              
|Bollington, Cheshire, U.K.     |  |                | 1,400   |          |  | Leased   |  | Sales office for hearing protection products in Europe                                                  
|                              
|                              
|                              
|                              
|Florence, Kentucky             |  |                | 20,000  |          |  | Leased   |  | Warehouse and distribution facility for hearing protection
	products                                    
|                              
|                              
|                              
|                              
|Albuquerque, New Mexico        |  |                | 900     |          |  | Leased   |  | Regional sales office for laser protection equipment                                                    
|                              
|                              
|                              
|                              
|Shafer, Minnesota              |  |                | 700     |          |  | Leased   |  | Regional sales and administrative office for protective eyewear
	and hearing protection products        

Recent Developments

The following information is provided with respect to our two
manufacturing and assembly operations in California, the
Survivair respiratory products facility in Santa Ana, and the
HLI hearing protection products facility in San Diego:

In recent months, there have been instances of electricity
shortages in the State of California. The two leading electric
utility companies in the state, Pacific Gas & Electric
Co. and Southern California Edison Co., have been unable to meet
the demands of all their customers for power supply, have
reported poor financial results and potential problems meeting
their outstanding financial obligations. In particular,
California has experienced temporary localized electricity
outages, or rolling blackouts, which may continue or worsen into
blackouts of longer duration in the future. In order to limit
our exposure at our two California facilities, we have
maintained inventory levels at approximately six weeks at
Survivair and 3.5 weeks at HLI. Our key supplies of
cylinders for self-contained breathing apparatus and carbon for
cartridges at Survivair are manufactured in California, however,
as a reserve against interruptions, we maintain approximately
one month supply of safety stocks of these key products at
Survivair. Our critical supplies of polyurethane prepolymer and
latex for HLI are produced outside of California.

We have not experienced blackouts at either of our California
facilities to date, but blackouts have interrupted the
operations of some of our suppliers and customers.
Notwithstanding the foregoing, blackouts in California, even of
relatively short duration, could impair or temporarily interrupt
our operations in those locations, not only with respect to
oversight of existing operations, but also in research and
development of new products. We could not readily or
inexpensively relocate these manufacturing operations to other
sites outside of California.

12



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##### Table of Contents






Item 3.  Legal Proceedings

We are not aware of any material pending legal proceedings to
which we or any of our affiliates is a party, or was a party
during the fiscal year ended December 31, 2000.

On February 22, 2000 we instituted a civil action in the
Rhode Island Superior Court seeking a Declaratory Judgment
interpreting language in a January 12, 1998 letter
agreement between Bacou USA, Inc. and Director Howard S.
Leight regarding whether Bacou carried out its obligations under
such agreement. Continental Polymers, Inc., a company in which
Mr. Leight owns a 40% interest, has been added as a party
and has filed a counterclaim for $4 million against Bacou
USA and Bacou Safety. Both Bacou entities have denied the
allegations in the counterclaim. The case has been removed to
U.S. District Court for the District of Rhode Island and is
currently in discovery. The case is expected to reach trial by
the fourth quarter of 2001.




Item 4.  Submission of Matters to a Vote of
Security Holders

Not applicable.




PART II




Item 5.  Market for the Registrants
Common Stock and Related Stockholder Matters

Our common stock trades on The New York Stock Exchange under the
symbol BAU. The authorized capital stock of Bacou
consists of 50,000,000 shares of Common Stock, $.001 par value
per share, and 5,000,000 shares of Preferred Stock, $.001 par
value per share.

For information regarding the high and low sales prices of our
common stock and dividends for each quarterly period, see Note
11 to the consolidated financial statements included in
Item 8 herein. As of March 20, 2001, the closing price
for our common stock was $25.70 per share and there were
approximately 31 holders of record.

13



---



##### Table of Contents






Item 6.  Selected Financial Data

The following table sets forth selected financial data of Bacou
for the periods indicated. Selected financial data for each of
the years in the five-year period ended December 31, 2000
were derived from financial statements of Bacou which were
audited by KPMG LLP, independent certified public accountants,
whose report with respect to the three-year period ended
December 31, 2000 appears in Item 8. The selected
financial data should be read in conjunction with the
Consolidated Financial Statements and related notes thereto,
Managements Discussion and Analysis of Financial
Condition and Results of Operations and other financial
information included elsewhere herein.

|                                                     |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |        |        | 
|---------------------------------------------------- | ---------------------------------------------------------- | ------------------------------------- | ------- | ------- | ------ | ------- | ------- | ------- | ------ | ------- | ------- | ------ | ------ | - | ------- | ------ | ------ | - | ------- | ------ | ------ | 
|                                                     |                                                            |                                      
|                                                     |                                                            | Year Ended December 31,              
|                                                     |                                                            |                                      
|                                                     |                                                            | 1996                                  |         | 1997(1) |        | 1998(2) |         | 1999(3) |        | 2000(4)
|                                                     |                                                            |                                       |         |         |        |         |         |         |        |        
|                                                     |                                                            |                                      
|                                                     |                                                            | (in thousands, except per share data)
|                                                    
|                                                    
|                                                    
|                                                    
|Statement of Income Data:                            |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|                                                    
|                                                    
|                                                    
|                                                    
|Net sales(5)                                         |                                                            | $                                     | 110,065 |         |        | $       | 132,156 |         |        | $       | 221,093 |        |        | $ | 274,658 |        |        | $ | 319,724 |       
|                                                    
|                                                    
|                                                    
|                                                    
|Cost of sales                                        |                                                            |                                       | 47,355  |         |        |         | 64,467  |         |        |         | 105,856 |        |        |   | 145,038 |        |        |   | 172,638 |       
|                                                     |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|Gross profit                                         |                                                            |                                       | 62,710  |         |        |         | 67,689  |         |        |         | 115,237 |        |        |   | 129,620 |        |        |   | 147,086 |       
|                                                    
|                                                    
|                                                    
|                                                    
|Operating expenses:                                  |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Selling(5)                                                 |                                       |         | 17,871  |        |         |         | 22,945  |        |         |         | 37,172 |        |   |         | 41,363 |        |   |         | 49,926 |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | General and administrative                                 |                                       |         | 9,176   |        |         |         | 11,184  |        |         |         | 22,895 |        |   |         | 22,597 |        |   |         | 22,231 |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Non-recurring costs  evaluation of strategic alternatives |                                       |         |        |        |         |         |        |        |         |         |       |        |   |         |       |        |   |         | 1,126  |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Research and development                                   |                                       |         |        |        |         |         | 1,110   |        |         |         | 4,000  |        |   |         | 5,274  |        |   |         | 5,643  |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Purchased in-process research and development              |                                       |         |        |        |         |         | 3,721   |        |         |         | 4,680  |        |   |         |       |        |   |         |       |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Amortization of intangibles assets                         |                                       |         | 4,039   |        |         |         | 4,095   |        |         |         | 7,748  |        |   |         | 9,440  |        |   |         | 9,850  |       
|                                                     |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|                                                     |                                                            | Total operating expenses              |         |         | 31,086 |         |         |         | 43,055 |         |         |        | 76,495 |   |         |        | 78,674 |   |         |        | 88,776 | 
|                                                     |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|Operating income                                     |                                                            |                                       | 31,624  |         |        |         | 24,634  |         |        |         | 38,742  |        |        |   | 50,946  |        |        |   | 58,310  |       
|                                                    
|                                                    
|                                                    
|                                                    
|Other expense (income), net                          |                                                            |                                       | 45      |         |        |         | (376    | )       |        |         | 6,054   |        |        |   | 8,591   |        |        |   | 9,497   |       
|                                                     |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|Income before income taxes                           |                                                            |                                       | 31,579  |         |        |         | 25,010  |         |        |         | 32,688  |        |        |   | 42,355  |        |        |   | 48,813  |       
|                                                    
|                                                    
|                                                    
|                                                    
|Income taxes                                         |                                                            |                                       | 12,202  |         |        |         | 10,588  |         |        |         | 11,678  |        |        |   | 15,165  |        |        |   | 17,933  |       
|                                                     |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|Net income(6)                                        |                                                            | $                                     | 19,377  |         |        | $       | 14,422  |         |        | $       | 21,010  |        |        | $ | 27,190  |        |        | $ | 30,880  |       
|                                                     |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|Earnings per share:                                  |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Basic(6)(7)                                                |                                       | $       | 1.18    |        |         | $       | 0.83    |        |         | $       | 1.19   |        |   | $       | 1.54   |        |   | $       | 1.75   |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Diluted(6)(7)                                              |                                       | $       | 1.18    |        |         | $       | 0.83    |        |         | $       | 1.19   |        |   | $       | 1.54   |        |   | $       | 1.73   |       
|                                                    
|                                                    
|                                                    
|                                                    
|Weighted average shares outstanding:                 |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Basic                                                      |                                       |         | 16,406  |        |         |         | 17,383  |        |         |         | 17,601 |        |   |         | 17,624 |        |   |         | 17,652 |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Diluted                                                    |                                       |         | 16,436  |        |         |         | 17,411  |        |         |         | 17,723 |        |   |         | 17,696 |        |   |         | 17,835 |       
|                                                    
|                                                    
|                                                    
|                                                    
|Balance Sheet Data (end of period):                  |                                                            |                                       |         |         |        |         |         |         |        |         |         |        |        |   |         |        |        |   |         |       
|                                                    
|                                                    
|                                                    
|                                                    
|Working capital                                      |                                                            | $                                     | 40,820  |         |        | $       | 34,509  |         |        | $       | 30,910  |        |        | $ | 44,010  |        |        | $ | 51,109  |       
|                                                    
|                                                    
|                                                    
|                                                    
|Total assets                                         |                                                            |                                       | 125,109 |         |        |         | 152,351 |         |        |         | 293,770 |        |        |   | 371,425 |        |        |   | 379,530 |       
|                                                    
|                                                    
|                                                    
|                                                    
|Total long-term debt, excluding current installments |                                                            |                                       |        |         |        |         |        |         |        |         | 92,050  |        |        |   | 120,256 |        |        |   | 98,178  |       
|                                                    
|                                                    
|                                                    
|                                                    
|Common stock subject to a put option                 |                                                            |                                       |        |         |        |         | 9,450   |         |        |         | 9,450   |        |        |   |        |        |        |   |        |       
|                                                    
|                                                    
|                                                    
|                                                    
|Stockholders equity                                 |                                                            |                                       | 112,407 |         |        |         | 122,902 |         |        |         | 144,462 |        |        |   | 181,455 |        |        |   | 213,075 |       




|    |                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------
|(1) | Includes operating results of Survivair from May 30, 1997
	and of Biosystems from September 30, 1997
|   
|(2) | Includes operating results of HLI from February 27, 1998                                            
|   
|(3) | Includes operating results of Perfect Fit and affiliates from
	April 1, 1999                        
|   
|(4) | Includes operating results of Whiting+Davis from July 1,
	2000                                      

14



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##### Table of Contents





|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(5) | Amounts have been adjusted to conform to the requirements of
	Emerging Issues Task Force Issue No. 00-10,
	Accounting for Shipping and Handling Fees and Costs
	(EITF No. 00-10)  see note 1(d) to the
	consolidated financial statements included with Item 8
	herein                                                                                                                                                                                                                                                                                                                                                                                    
|   
|(6) | Operating results of Bacou for the years 1997-2000, include
	various non-recurring items consisting of acquisition-related
	costs and charges, a 1998 severance charge equal to $1.4
	million, and costs equal to $1.1 million in 2000 incurred in
	connection with our evaluation of strategic alternatives.
	Excluding non-recurring items, and including operating results
	of the acquired companies as described above, Bacous net
	income, and both basic and diluted earnings per share, would
	have been as follows for each of the periods presented (see
	Managements Discussion and Analysis of Financial
	Condition and Results of Operations):

|                    |         |                         |        |      |  |      |        |      |  |      |        |      |  |   |        |      |  |   |        |      | 
|------------------- | ------- | ----------------------- | ------ | ---- |  | ---- | ------ | ---- |  | ---- | ------ | ---- |  | - | ------ | ---- |  | - | ------ | ---- | 
|                    |         |                        
|                    |         | Year Ended December 31,
|                    |         |                        
|                    |         | 1996                    |        | 1997 |  | 1998 |        | 1999 |  | 2000
|                    |         |                         |        |      |  |      |        |      |  |     
|Net income          |         | $                       | 19,377 |      |  | $    | 19,498 |      |  | $    | 25,793 |      |  | $ | 27,544 |      |  | $ | 32,132 |     
|                   
|                   
|                   
|                   
|Earnings per share: |         |                         |        |      |  |      |        |      |  |      |        |      |  |   |        |      |  |   |        |     
|                   
|                   
|                   
|                   
|                    | Basic   |                         | $      | 1.18 |  |      | $      | 1.12 |  |      | $      | 1.46 |  |   | $      | 1.56 |  |   | $      | 1.82 | 
|                   
|                   
|                   
|                   
|                    | Diluted |                         | $      | 1.18 |  |      | $      | 1.12 |  |      | $      | 1.46 |  |   | $      | 1.56 |  |   | $      | 1.80 | 



|    |                                                                                         
|--- | ----------------------------------------------------------------------------------------
|(7) | Bacou neither declared nor paid any cash dividends during any of
	the periods presented.






|        |                                                                                       
|------- | --------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
	Condition and Results of Operations

The following discussion of our financial condition and
results of operations should be read in conjunction with our
consolidated financial statements and notes thereto, as well as
our selected financial data, all appearing elsewhere herein.
Statements contained in this discussion or elsewhere in this
filing that are not historical facts are forward-looking
statements that are made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. In
addition, words such as believes,
anticipates, expects and similar
expressions are intended to identify forward-looking statements.
We caution you that a number of important factors could cause
our actual results to differ materially from those expressed in
any forward-looking statements made by us, or on our behalf.
Forward-looking statements involve a number of risks and
uncertainties including, but not limited to, the following:



| |   |                                                                                                                                       
| | - | --------------------------------------------------------------------------------------------------------------------------------------
| |  | the impact of our ongoing evaluation of certain strategic
	alternatives, including the possible sale of Bacou USA and Bacou
	S.A.;    
|
| |  | general economic conditions, including the effect of
	reductions in the number of employees in industries which
	utilize our products;
|
| |  | continued demand for our current product lines;                                                                                       
|
| |  | the success of our new product introductions;                                                                                         
|
| |  | the success of our acquisition strategy, including our
	ability to integrate new businesses;                                          
|
| |  | continued availability and favorable pricing of raw
	materials;                                                                       
|
| |  | the effect of any work stoppages;                                                                                                     
|
| |  | the effect of any business interruption resulting from
	electricity shortages;                                                        
|
| |  | competitive pressures;                                                                                                                
|
| |  | fluctuations in interest rates; and                                                                                                   
|
| |  | regulatory matters.                                                                                                                   

We cannot assure you that we will be able to anticipate or
respond timely to changes in any of the factors listed above,
which could adversely affect our operating results in one or
more fiscal periods. Our operating results in any past period
should not be considered indicative of the results to be
expected for future periods. Fluctuations in operating results
may also result in fluctuations in the price of our common
stock.

15



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##### Table of Contents



Background

Effect of Acquisitions

We are pursuing a business strategy that includes acquisitions
as an important element. As described more fully below, we
completed five acquisitions during the past four years, which
have significantly increased our product offerings and size.
Annual net sales volume has increased from $110.1 million for
the year ended December 31, 1996 to $319.7 million for the
year ended December 31, 2000. Our gross margin and
operating margin for the year ended December 31, 1996, were
57.0% and 28.7%, respectively. Historical margins attributable
to the operations of businesses acquired by us have generally
been lower than margins at our platform Uvex Safety business. As
such, inclusion of acquired businesses with our existing Uvex
Safety business has also resulted in a decline in our margins
during the five-year period ended December 31, 2000.

On June 30, 2000, we purchased substantially all of the
assets and assumed substantially all of the liabilities of
Whiting+Davis, a manufacturer and distributor of metal mesh
gloves, sleeves and apparel.

On April 1, 1999, we purchased substantially all of the
assets and assumed substantially all of the liabilities of
Perfect Fit, a manufacturer and distributor of protective gloves
and other related products. We paid cash consideration of $42.2
million for the acquisition of the Perfect Fit business.

Effective February 27, 1998, we purchased substantially all
of the assets and assumed substantially all of the liabilities
of Howard Leight, a manufacturer of hearing protection products
(including disposable, reusable and banded ear plugs, and ear
muffs) for cash consideration of $125.9 million, $5.9 million of
which represented the refinancing of Howard Leight indebtedness.

We acquired all of the outstanding capital stock of Comasec
Holdings, Inc. on May 30, 1997 for cash consideration of
$27.4 million. The assets of Comasec consisted primarily of its
wholly-owned subsidiary, Survivair, Inc., a manufacturer of
respiratory protection products. On September 30, 1997, we
also acquired all of the capital stock of Biosystems, Inc., a
manufacturer of gas monitors and equipment for testing
self-contained breathing apparatus, in exchange for 826,514
shares of our common stock having a fair market value equal to
$13.5 million.

Operating results for each of the above acquisitions have been
included in our consolidated financial statements beginning with
the respective acquisition dates.

Certain non-recurring costs, principally relating to
acquisitions, have been included in our 1997, 1998, 1999 and
2000 operating results. In connection with the acquisitions of
Howard Leight, Survivair and Biosystems, we allocated a portion
of the acquisition price to the fair value of purchased
in-process research and development. These amounts, totaling
$3.7 million in 1997 and $4.7 million in 1998, were charged to
operating expenses in full upon the date of acquisition. In
connection with our acquisitions, acquired inventories were
adjusted to fair values, and these adjustments were subsequently
charged to cost of sales when the acquired inventories were
sold. These amounts were equal to $2.1 million in 1997, $1.0
million in 1998, $0.6 million in 1999 and $0.2 million in 2000.
We also paid cash bonuses in the amount of $0.6 million in 1998
to certain senior executives of Howard Leight in connection with
that acquisition, which have been included with general and
administrative expenses. The following discussion provides an
analysis of our actual operating results, and also analyzes our
operating results excluding the effect of acquisition-related
and other non-recurring items.

16



---



##### Table of Contents



Results of Operations

The following table presents selected operating data and such
amounts as percentages of net sales for the periods indicated
(in thousands, except percentages).

|                           |                                                             |                          |         |                   |        |                   |       |      |      |   |         |        |        |  |       |      |      |   |         |        |        |  |       |      |      | 
|-------------------------- | ----------------------------------------------------------- | ------------------------ | ------- | ----------------- | ------ | ----------------- | ----- | ---- | ---- | - | ------- | ------ | ------ |  | ----- | ---- | ---- | - | ------- | ------ | ------ |  | ----- | ---- | ---- | 
|                           |                                                             |                          |         |                   |        |                  
|                           |                                                             | Year Ended               |         | Year Ended        |        | Year Ended       
|                           |                                                             | December 31, 1998        |         | December 31, 1999 |        | December 31, 2000
|                           |                                                             |                          |         |                   |        |                  
|                           |                                                             |                          |         |                   |        |                   |       |      |      |  
|                          
|                          
|                          
|                          
|Net sales(1)               |                                                             | $                        | 221,093 |                   |        |                   | 100.0 | %    |      | $ | 274,658 |        |        |  | 100.0 | %    |      | $ | 319,724 |        |        |  | 100.0 | %   
|                          
|                          
|                          
|                          
|Cost of sales(2)           |                                                             |                          | 105,856 |                   |        |                   | 47.9  |      |      |   | 145,038 |        |        |  | 52.8  |      |      |   | 172,638 |        |        |  | 54.0  |     
|                           |                                                             |                          |         |                   |        |                   |       |      |      |   |         |        |        |  |       |      |      |   |         |        |        |  |       |     
|Gross profit               |                                                             |                          | 115,237 |                   |        |                   | 52.1  |      |      |   | 129,620 |        |        |  | 47.2  |      |      |   | 147,086 |        |        |  | 46.0  |     
|                          
|                          
|                          
|                          
|Operating expenses:        |                                                             |                          |         |                   |        |                   |       |      |      |   |         |        |        |  |       |      |      |   |         |        |        |  |       |     
|                          
|                          
|                          
|                          
|                           | Selling(1)                                                  |                          |         | 37,172            |        |                   |       | 16.7 |      |   |         | 41,363 |        |  |       | 15.1 |      |   |         | 49,926 |        |  |       | 15.6 |     
|                          
|                          
|                          
|                          
|                           | General and administrative(3)                               |                          |         | 22,895            |        |                   |       | 10.4 |      |   |         | 22,597 |        |  |       | 8.2  |      |   |         | 22,231 |        |  |       | 7.0  |     
|                          
|                          
|                          
|                          
|                           | Non-recurring costs  evaluation of strategic
	alternatives |                          |         |                  |        |                   |       |     |      |   |         |       |        |  |       |     |      |   |         | 1,126  |        |  |       | 0.3  |     
|                          
|                          
|                          
|                          
|                           | Research and development                                    |                          |         | 4,000             |        |                   |       | 1.8  |      |   |         | 5,274  |        |  |       | 1.9  |      |   |         | 5,643  |        |  |       | 1.8  |     
|                          
|                          
|                          
|                          
|                           | Purchased in-process research and development               |                          |         | 4,680             |        |                   |       | 2.1  |      |   |         |       |        |  |       |     |      |   |         |       |        |  |       |     |     
|                          
|                          
|                          
|                          
|                           | Amortization of intangible assets                           |                          |         | 7,748             |        |                   |       | 3.5  |      |   |         | 9,440  |        |  |       | 3.4  |      |   |         | 9,850  |        |  |       | 3.1  |     
|                           |                                                             |                          |         |                   |        |                   |       |      |      |   |         |        |        |  |       |      |      |   |         |        |        |  |       |     
|                           |                                                             | Total operating expenses |         |                   | 76,495 |                   |       |      | 34.5 |   |         |        | 78,674 |  |       |      | 28.6 |   |         |        | 88,776 |  |       |      | 27.8 | 
|                           |                                                             |                          |         |                   |        |                   |       |      |      |   |         |        |        |  |       |      |      |   |         |        |        |  |       |     
|Operating income           |                                                             |                          | 38,742  |                   |        |                   | 17.6  |      |      |   | 50,946  |        |        |  | 18.6  |      |      |   | 58,310  |        |        |  | 18.2  |     
|                          
|                          
|                          
|                          
|Other expense, net         |                                                             |                          | 6,054   |                   |        |                   | 2.8   |      |      |   | 8,591   |        |        |  | 3.2   |      |      |   | 9,497   |        |        |  | 3.0   |     
|                           |                                                             |                          |         |                   |        |                   |       |      |      |   |         |        |        |  |       |      |      |   |         |        |        |  |       |     
|Income before income taxes |                                                             |                          | 32,688  |                   |        |                   | 14.8  |      |      |   | 42,355  |        |        |  | 15.4  |      |      |   | 48,813  |        |        |  | 15.2  |     
|                          
|                          
|                          
|                          
|Income taxes               |                                                             |                          | 11,678  |                   |        |                   | 5.3   |      |      |   | 15,165  |        |        |  | 5.5   |      |      |   | 17,933  |        |        |  | 5.5   |     
|                           |                                                             |                          |         |                   |        |                   |       |      |      |   |         |        |        |  |       |      |      |   |         |        |        |  |       |     
|Net income                 |                                                             | $                        | 21,010  |                   |        |                   | 9.5   | %    |      | $ | 27,190  |        |        |  | 9.9   | %    |      | $ | 30,880  |        |        |  | 9.7   | %   
|                           |                                                             |                          |         |                   |        |                   |       |      |      |   |         |        |        |  |       |      |      |   |         |        |        |  |       |     




|    |                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Amounts have been adjusted to conform to the requirements of
	EITF No. 00-10 (see note 1(d) to the consolidated
	financial statements included with Item 8 herein).  
|   
|(2) | Includes acquisition-related costs totaling $1,013,000 in 1998,
	$590,000 in 1999 and $204,000 in 2000.                                                              
|   
|(3) | Includes non-recurring charges for termination benefits totaling
	$1,425,000 and acquisition-related bonuses totaling $600,000 for
	the year ended December 31, 1998.

17



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##### Table of Contents



Year Ended December 31, 2000 Compared
to Year Ended December 31, 1999

Net Sales.Our net sales increased 16.4% from $274.6
million for the year ended December 31, 1999 to $319.7
million for the year ended December 31, 2000. Net sales for
our safety segment increased 9.0% from $202.7 million in 1999 to
$221.0 million in 2000, entirely as a result of internal growth
in units shipped. Net sales for our glove segment increased
70.8% from $39.9 million in 1999 to $68.1 million in 2000.
Operating results of our Perfect Fit business have been included
for a full year and operating results of our Whiting+Davis
business for six months in 2000, compared with the 1999-period
which only included operating results of Perfect Fit and only
for nine months. The increase in glove segment sales of $28.3
million includes internal growth equal to $8.6 million (21.5%),
and an increase of $19.7 million (49.3%) attributable to the
acquisition of these businesses. Net sales for our optical
frames and instruments segment declined from $32.0 million in
1999 to $30.6 million in 2000. The combined international sales
of all three segments increased 23.2% from $37.0 million in 1999
to $45.5 million in 2000.

Cost of Sales.Our cost of sales increased 19.0% from
$145.0 million for the year ended December 31, 1999 to
$172.6 million for the year ended December 31, 2000, due to
increased sales volume.

Gross Profit.Our gross profit increased 13.5% from
$129.6 million for the year ended December 31, 1999 to
$147.1 million for the year ended December 31, 2000.
Excluding acquisition-related inventory adjustments, our gross
margin was 47.4% for the year ended December 31, 1999 and
46.1% for the year ended December 31, 2000. The reduction
in our gross margin was primarily attributable to substantial
increases in the sales of our glove products, which have lower
gross margins than our other product lines.

Operating Expenses.Our operating expenses increased
12.8% from $78.7 million for the year ended December 31,
1999 to $88.8 million for the year ended December 31, 2000.
This increase resulted principally from inclusion of operating
expenses of both our Perfect Fit and Whiting+Davis businesses
for a longer period in 2000, from volume-related increases in
our selling expenses, and due to non-recurring costs totaling
$1.1 million incurred in connection with our ongoing evaluation
of certain strategic alternatives. Excluding these non-recurring
costs, our operating expenses were 28.6% of net sales in 1999
and 27.5% of net sales in 2000. Our ratio of operating expenses
to net sales declined due to higher sales volume in 2000 and our
ability to limit increases in general and administrative
expenses.

We are continuing our evaluation of strategic alternatives and
expect to incur additional costs during 2001 in connection with
this process.

Operating Income.As a result of the foregoing, our
operating income increased 14.5% from $50.9 million for the year
ended December 31, 1999 to $58.3 million for the year ended
December 31, 2000.

Other Expense.Other expense increased 10.5% from $8.6
million for the year ended December 31, 1999 to $9.5
million for the year ended December 31, 2000. Other expense
consists principally of net interest expense totaling $8.3
million in 1999 and $9.4 million in 2000. The increase in net
interest expense from 1999 to 2000 is due to higher average debt
balances outstanding in 2000, as a result of borrowings we made
in connection with our acquisitions of Perfect Fit and Whiting +
Davis, and also due to higher average interest rates in 2000.

Income Taxes.Our effective income tax rate was 35.8% in
1999 and 36.7% in 2000. The effective rate in both periods was
higher than the federal statutory rate of 35.0% due to state and
local income taxes. We have not recorded a tax benefit on any of
the costs incurred in connection with our evaluation of
strategic alternatives, thereby resulting in an increase to our
effective tax rate from 1999 to 2000.

Net Income.As a result of the foregoing, our net income
increased 13.6% from $27.2 million for the year ended
December 31, 1999 to $30.9 million for the year ended
December 31, 2000, and our diluted earnings per share
increased 12.3% from $1.54 in 1999 to $1.73 in 2000. Our net
income (excluding non-recurring items in both periods) increased
16.7% from $27.5 million for the year ended December 31,
1999 to $32.1 million for the year ended December 31, 2000.
Our diluted earnings per share, again excluding non-recurring
items, increased 15.4% from $1.56 in 1999 to $1.80 in 2000.

18



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##### Table of Contents



Year Ended December 31, 1999 Compared
to Year Ended December 31, 1998

Net Sales.Our net sales increased 24.2% from $221.1
million for the year ended December 31, 1998 to $274.6
million for the year ended December 31, 1999. Net sales in
1999 included sales totaling $39.9 million for our glove
segment, consisting entirely of the Perfect Fit business
(acquired by us on April 1, 1999), accounting for an
increase of 18.1%.

Net sales for our safety segment increased 6.6% from $190.1
million in 1998 to $202.7 million in 1999, while net sales for
our optical frames and instruments segment increased 3.5% from
$31.0 million in 1998 to $32.0 million in 1999.

Cost of Sales.Our cost of sales increased 37.0% from
$105.9 million for the year ended December 31, 1998 to
$145.0 million for the year ended December 31, 1999,
primarily due to inclusion of operating results of acquired
businesses.

Gross Profit.Our gross profit increased 12.5% from
$115.2 million for the year ended December 31, 1998 to
$129.6 million for the year ended December 31, 1999. Our
overall gross margin (excluding non-recurring items in both
periods) declined from 52.6% in 1998 to 47.4% in 1999,
principally due to lower gross margins attributable to the glove
segment.

Operating Expenses.Our operating expenses increased 2.9%
from $76.5 million for the year ended December 31, 1998 to
$78.7 million for the year ended December 31, 1999.
Excluding non-recurring items in 1998, operating expenses
increased 12.7% from $69.8 million in the 1998 period to $78.7
million in the 1999 period. This increase resulted principally
from inclusion of operating expenses of acquired businesses.

Excluding non-recurring items, our operating expenses were 31.6%
of net sales in 1998 and 28.6% of net sales in 1999. Our ratio
of operating expenses to net sales declined principally due to
inclusion in 1999 of the operating results of our Perfect Fit
business, which has historically had lower selling, general and
administrative costs as a percentage of its net sales.

Operating Income.Principally as a result of
non-recurring items in the 1998 period, our operating income of
$50.9 million for the year ended December 31, 1999, was
31.5% higher than our operating income of $38.7 million for the
year ended December 31, 1998. Excluding non-recurring items
in both periods, our operating income increased 10.9% from $46.5
million in the 1998 period to $51.5 million in the 1999 period,
while our operating margin declined from 21.0% in 1998 to 18.8%
in 1999. Inclusion of the operating results of our newly
acquired glove segment during 1999 was the principal cause for
the decline in our consolidated operating margin from 1998 to
1999.

Other Expense.Other expense increased 41.9% from $6.1
million for the year ended December 31, 1998 to $8.6
million for the year ended December 31, 1999. Other expense
consists principally of net interest expense totaling $6.2
million in the 1998 period and $8.3 million in the 1999 period.
The increase in net interest expense from 1998 to 1999 is due to
additional borrowings we made in connection with acquisitions.

Income Taxes.Our effective income tax rate was 35.7% in
1998 and 35.8% in 1999. The effective rate in both periods was
higher than the federal statutory rate of 35.0% due to state and
local income taxes.

Net Income.Principally as a result of non-recurring
items in the 1998 period, our net income of $27.2 million for
the year ended December 31, 1999, was 29.4% higher than our
net income of $21.0 million for the year ended December 31,
1998. Excluding non-recurring items in both periods, our net
income increased 6.8% from $25.8 million in the 1998 period to
$27.5 million in the 1999 period.

19



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##### Table of Contents



Liquidity and Capital Resources

Our liquidity historically has been derived from cash flow
provided by operations and, periodically, from bank borrowings
utilized to finance the acquisition of businesses and certain
capital expenditures. We utilize EBITDA (earnings before
interest, taxes, depreciation and amortization) as a measure of
our cash flow provided by operations. EBITDA should not be
considered in isolation or as a substitute for net earnings or
cash provided by operating activities, each prepared in
accordance with generally accepted accounting principles. EBITDA
as reported by us is equal to operating income plus depreciation
and amortization, adjusted (when applicable) for non-recurring
items. Principally due to increased profitability, our EBITDA
increased 14.8% from $68.8 million for the year ended
December 31, 1999 to $79.0 million for the year ended
December 31, 2000.

Our working capital increased by $7.1 million from $44.0 million
at December 31, 1999, to $51.1 million at December 31,
2000, primarily due to increases in trade receivables. Our trade
receivables have increased principally as a result of higher
sales volume.

We used cash equal to $28.4 million during the year ended
December 31, 2000, and $59.1 million during the year ended
December 31, 1999, for investing activities 
primarily capital expenditures and investments in new
businesses. Capital expenditures totaled $11.9 million (net of
cash received from insurance proceeds and asset disposals)
during the year ended December 31, 2000, and $18.9 million
during the year ended December 31, 1999. In connection with
our acquisition of Perfect Fit, we paid cash consideration
totaling $37.1 million in 1999. We used cash equal to $16.7
million in 2000 consisting principally of a final payment of
contingent consideration due on the acquisition of Perfect Fit
and amounts paid to acquire Whiting+Davis.

Pursuant to our stock purchase agreement with Biosystems, Inc.,
the initial purchase price for our 1997 acquisition of that
company may be increased if the operating results of this
business during the year ended December 31, 2000, exceed
certain defined thresholds of profitability. If defined
profitability levels are not achieved, no contingent payment is
required. If, however, the operating results of this business
meet these defined profitability levels then a minimum
contingent payment equal to $5.0 million will be due, increasing
based upon a sliding scale thereafter. Preliminary indications
are that a contingent payment is not due, but, if due, would not
exceed $5.0 million. According to the purchase agreement, a
final determination on this matter is not required to be made
until April 15, 2001 and may be subject to arbitration
provisions after that date. Contingent payments (if any) would
be payable in unregistered shares of our common stock, except
that the former stockholders of Biosystems, Inc. have the option
to receive all or part of any payment in cash. Any contingent
payment would be due in 2001 and would result in additional
goodwill. We expect to finance the cash portion of any such
payment from operations or bank borrowings.

In connection with certain acquisitions, we entered into two
credit agreements with Banque Nationale de Paris
(BNP). Pursuant to the credit agreements, BNP made
term loans to Bacou USA in the original principal amount of
$110.0 million (in February 1998) and $50.0 million (in
March 1999). Both loans require principal repayments in
equal quarterly installments over seven years and require
quarterly interest payments at annual rates equal to three-month
LIBOR plus 0.50% and 0.60%, respectively.

We have entered into a credit agreement with Fleet National Bank
(f/k/a BankBoston, N.A.) as agent for participating banks
(Fleet). Under this credit agreement the bank
established a revolving line of credit facility with a maximum
principal limit of $36.0 million (Fleet Revolving
Facility). Principal outstanding under the Fleet Revolving
Facility will bear interest at our option at either (a) a
fixed rate equal to LIBOR plus 0.70%, or (b) a floating
rate equal to Fleets base rate. Principal outstanding on
the Fleet Revolving Facility at December 31, 2000 was equal
to $5.2 million and is scheduled for repayment on
August 24, 2001.

Fleet also has agreed to purchase up to $30.0 million of
economic development revenue bonds issued by Rhode Island
Industrial Facilities Corporation (RIIFC Revenue
Bonds). At December 31, 2000, there was a principal
balance outstanding equal to $11.2 million under the RIIFC
Revenue Bonds. Principal outstanding bears interest at fixed
rates ranging from LIBOR plus 0.70% to LIBOR plus 0.95%.
Proceeds from these revenue bonds were used to fund the
acquisition of our Rhode Island manufacturing facility in
July 1999, to fund the construction of an addition to such
facility (which has recently been completed) and for the purchase

20



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##### Table of Contents





In connection with our acquisition of Perfect Fit we assumed
indebtedness outstanding under Wilkes County Industrial
Development Revenue Bonds in the principal amount of $6.3
million. Principal outstanding under these revenue bonds bears
interest at a variable rate, which averaged 4.3% during the year
ended December 31, 2000. In March 2000, we
restructured the repayment terms of these bonds such that the
remaining principal balance of $5.6 million is now due in full
on December 31, 2006.

We are pursuing a business strategy that includes acquisitions
as an important element. As a result, we may incur additional
indebtedness, may be required to negotiate additional credit
facilities, or may issue preferred stock or additional common
stock in order to fund potential future acquisitions. We believe
we would have access to sufficient capital to consummate future
acquisitions. Except for cash requirements to fund acquisitions,
we believe that cash flow provided by our operating activities
together with unused borrowing capacity will be sufficient to
fund our working capital requirements, debt service requirements
and capital expenditures for the foreseeable future.

Seasonality

Our business has been subject to slight seasonal variations,
which we have attributed to fluctuations in industrial activity
and annual weather patterns. Historically, our sales from
November through February have been somewhat lower than other
periods due to anticipated lower demand in the more inclement
winter months and planned inventory reductions by major
distributors. In addition to seasonality, our business has been
variable period to period due to other factors, including
promotional activity undertaken by us in response to competitive
pressures, market demand, production capacity, inventory levels
and other considerations.

Effects of Inflation

Inflation during recent years has been modest and has not had a
material impact upon the results of our operations.

New Accounting Pronouncements

In September 1998, the Financial Accounting Standards Board
(FASB) issued Statement of Financial Accounting
Standards No. 133, Accounting for Derivative
Instruments and Hedging Activities. This statement
requires companies to recognize derivatives as either assets or
liabilities on the balance sheet and measure those instruments
at fair value. We were required to adopt the provisions of this
statement January 1, 2001. Adoption of this pronouncement
did not have a material impact on our financial condition or
results of operations.

In September 2000 the FASB Emerging Issues Task Force
discussed Issue No. 00-22 Accounting for Points and
Certain Other Time-Based or Volume-Based Sales Incentive Offers,
and Offers for Free Products or Services to Be Delivered in the
Future, and Issue No. 00-25 Accounting for
Consideration from a Vendor to a Retailer in Connection with the
Purchase or Promotion of the Vendors Products. A
consensus has not yet been reached on either matter. Issue
No. 00-22 addresses the accounting for future offers to
customers of free product, discounts or rebates which will be
awarded only if the customer completes a specified cumulative
level of revenue transactions or remains a customer for a
specified time period. Issue No. 00-25 addresses whether
certain consideration offered by a vendor to a distributor,
including slotting fees, cooperative advertising arrangements
and buy-down programs, should be characterized as
operating expenses or reductions of revenue. These
pronouncements may result in a reclassification of certain costs
within our income statement, but are not expected to have a
material impact on our financial condition or results of
operations.

21



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##### Table of Contents



In February 2001, the FASB issued a revised exposure draft,
Business Combinations and Intangible Assets 
Accounting for Goodwill. As currently drafted, this
pronouncement would become effective for us during our first
fiscal quarter after its issuance and would require that
goodwill be periodically tested for impairment but no longer be
amortized.




Item 7A.  Quantitative and Qualitative
Disclosures about Market Risk

Market risk can result from fluctuations in interest rates,
foreign currency exchange rates, commodity prices or other
market exposures. Uncertainties that are either non-financial or
non-quantifiable, such as political, economic, tax, other
regulatory or credit risks are not included in the following
assessment of our market risks.

We believe our only material market risk exposure is the risk of
adverse fluctuations in interest rates. At December 31,
2000, we had debt outstanding totaling $126.2 million. Interest
rates on principally all of this debt are variable based upon
three-month LIBOR. Three-month LIBOR approximated 6.4% at
December 31, 2000.

A 10% adverse change in the prevailing interest rates during
2000 would have resulted in a reduction of our after-tax
earnings of approximately $600,000, or $0.03 per diluted share.
We have prepared sensitivity analyses of our interest rate
exposure to assess the future impact of hypothetical changes in
interest rates. Based upon the results of these analyses, we
believe that a 10% adverse change from the December 31,
2000, interest rates would result in the potential loss of
after-tax earnings over the next twelve months equal to
approximately $500,000, or $0.03 per diluted share.

22



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##### Table of Contents








|        |                                            
|------- | -------------------------------------------
|Item 8. | Financial Statements and Supplementary Data

INDEX TO FINANCIAL STATEMENTS

|                                                |  |      |    | 
|----------------------------------------------- |  | ---- | -- | 
|                                                |  | Page
|                                                |  |     
|Independent Auditors Report                    |  |      | 24 | 
|                                               
|                                               
|                                               
|                                               
|Consolidated Balance Sheets                     |  |      | 25 | 
|                                               
|                                               
|                                               
|                                               
|Consolidated Statements of Income               |  |      | 26 | 
|                                               
|                                               
|                                               
|                                               
|Consolidated Statements of Stockholders Equity |  |      | 27 | 
|                                               
|                                               
|                                               
|                                               
|Consolidated Statements of Cash Flows           |  |      | 28 | 
|                                               
|                                               
|                                               
|                                               
|Notes to Consolidated Financial Statements      |  |      | 29 | 

23



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##### Table of Contents



INDEPENDENT AUDITORS REPORT

The Board of Directors and Stockholders



We have audited the accompanying consolidated balance sheets of
Bacou USA, Inc. and subsidiaries as of December 31, 1999
and 2000 and the related consolidated statements of income,
stockholders equity, and cash flows for each of the years
in the three-year period ended December 31, 2000. These
consolidated financial statements are the responsibility of the
companys management. Our responsibility is to express an
opinion on these consolidated financial statements based on our
audits.

We conducted our audits in accordance with auditing standards
generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred
to above fairly present, in all material respects, the financial
position of Bacou USA, Inc. and subsidiaries as of
December 31, 1999 and 2000 and the results of their
operations and their cash flows for each of the years in the
three-year period ended December 31, 2000, in conformity
with accounting principles generally accepted in the United
States of America.



| |         
| | --------
| | KPMG LLP

Providence, Rhode Island



24



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)


|                                     |                                                                                                                                               |                                            |         |         |         |  |         |         |         | 
|------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ------- | ------- | ------- |  | ------- | ------- | ------- | 
|                                     |                                                                                                                                               |                                           
|                                     |                                                                                                                                               | December 31,                              
|                                     |                                                                                                                                               |                                           
|                                     |                                                                                                                                               | 1999                                       |         | 2000   
|                                     |                                                                                                                                               |                                            |         |        
|ASSETS                               |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                    
|                                    
|                                    
|                                    
|Current assets:                      |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                    
|                                    
|                                    
|                                    
|                                     | Cash and cash equivalents                                                                                                                     |                                            | $       | 10,272  |         |  | $       | 980     |        
|                                    
|                                    
|                                    
|                                    
|                                     | Trade accounts receivable, net                                                                                                                |                                            |         | 41,653  |         |  |         | 53,275  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Inventories                                                                                                                                   |                                            |         | 42,433  |         |  |         | 45,504  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Other current assets                                                                                                                          |                                            |         | 1,634   |         |  |         | 2,024   |        
|                                    
|                                    
|                                    
|                                    
|                                     | Deferred income taxes                                                                                                                         |                                            |         | 3,733   |         |  |         | 1,952   |        
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                     |                                                                                                                                               | Total current assets                       |         |         | 99,725  |  |         |         | 103,735 | 
|                                    
|                                    
|                                    
|                                    
|Property and equipment, net          |                                                                                                                                               |                                            | 74,410  |         |         |  | 78,392  |        
|                                    
|                                    
|                                    
|                                    
|Intangible assets, net               |                                                                                                                                               |                                            | 194,258 |         |         |  | 194,456 |        
|                                    
|                                    
|                                    
|                                    
|Other assets                         |                                                                                                                                               |                                            | 3,032   |         |         |  | 2,947   |        
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                     |                                                                                                                                               | Total assets                               |         | $       | 371,425 |  |         | $       | 379,530 | 
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        
|LIABILITIES AND STOCKHOLDERS EQUITY |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                    
|                                    
|                                    
|                                    
|Current liabilities:                 |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                    
|                                    
|                                    
|                                    
|                                     | Current installments of long-term debt                                                                                                        |                                            | $       | 23,637  |         |  | $       | 28,057  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Accounts payable                                                                                                                              |                                            |         | 10,559  |         |  |         | 11,239  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Accrued compensation and benefits                                                                                                             |                                            |         | 8,408   |         |  |         | 6,186   |        
|                                    
|                                    
|                                    
|                                    
|                                     | Other accrued expenses                                                                                                                        |                                            |         | 12,084  |         |  |         | 5,602   |        
|                                    
|                                    
|                                    
|                                    
|                                     | Income taxes payable                                                                                                                          |                                            |         | 1,027   |         |  |         | 1,542   |        
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                     |                                                                                                                                               | Total current liabilities                  |         |         | 55,715  |  |         |         | 52,626  | 
|                                    
|                                    
|                                    
|                                    
|Long-term debt                       |                                                                                                                                               |                                            | 120,256 |         |         |  | 98,178  |        
|                                    
|                                    
|                                    
|                                    
|Deferred income taxes                |                                                                                                                                               |                                            | 11,550  |         |         |  | 13,852  |        
|                                    
|                                    
|                                    
|                                    
|Other liabilities                    |                                                                                                                                               |                                            | 2,449   |         |         |  | 1,799   |        
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                     |                                                                                                                                               | Total liabilities                          |         |         | 189,970 |  |         |         | 166,455 | 
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        
|Stockholders equity:                |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                    
|                                    
|                                    
|                                    
|                                     | Preferred stock, $.001 par value, 5,000,000 shares authorized,
	no shares issued and outstanding                                              |                                            |         |        |         |  |         |        |        
|                                    
|                                    
|                                    
|                                    
|                                     | Common stock, $.001 par value, 50,000,000 shares authorized,
	17,629,865 shares in 1999 and 17,671,465 shares in 2000 issued
	and outstanding |                                            |         | 18      |         |  |         | 18      |        
|                                    
|                                    
|                                    
|                                    
|                                     | Additional paid-in capital                                                                                                                    |                                            |         | 73,060  |         |  |         | 73,800  |        
|                                    
|                                    
|                                    
|                                    
|                                     | Retained earnings                                                                                                                             |                                            |         | 108,377 |         |  |         | 139,257 |        
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                     |                                                                                                                                               | Total stockholders equity                 |         |         | 181,455 |  |         |         | 213,075 | 
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        
|                                     |                                                                                                                                               | Total liabilities and stockholders equity |         | $       | 371,425 |  |         | $       | 379,530 | 
|                                     |                                                                                                                                               |                                            |         |         |         |  |         |        

See accompanying notes to consolidated financial statements.

25



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BACOU USA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share data)


|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |         |        | 
|------------------------------------ | ----------------------------------------------------------- | ------------------------ | ------- | ------- | ------ | ---- | ------- | ------- | ------ | - | ------- | ------- | ------ | 
|                                     |                                                             |                         
|                                     |                                                             | Years Ended December 31,
|                                     |                                                             |                         
|                                     |                                                             | 1998                     |         | 1999    |        | 2000
|                                     |                                                             |                          |         |         |        |     
|Net sales                            |                                                             | $                        | 221,093 |         |        | $    | 274,658 |         |        | $ | 319,724 |        
|                                    
|                                    
|                                    
|                                    
|Cost of sales                        |                                                             |                          | 105,856 |         |        |      | 145,038 |         |        |   | 172,638 |        
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|                                     | Gross profit                                                |                          |         | 115,237 |        |      |         | 129,620 |        |   |         | 147,086 |       
|                                    
|                                    
|                                    
|                                    
|Operating expenses:                  |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|                                    
|                                    
|                                    
|                                    
|                                     | Selling                                                     |                          |         | 37,172  |        |      |         | 41,363  |        |   |         | 49,926  |       
|                                    
|                                    
|                                    
|                                    
|                                     | General and administrative                                  |                          |         | 22,895  |        |      |         | 22,597  |        |   |         | 22,231  |       
|                                    
|                                    
|                                    
|                                    
|                                     | Non-recurring costs  evaluation of strategic
	alternatives |                          |         |        |        |      |         |        |        |   |         | 1,126   |       
|                                    
|                                    
|                                    
|                                    
|                                     | Research and development                                    |                          |         | 4,000   |        |      |         | 5,274   |        |   |         | 5,643   |       
|                                    
|                                    
|                                    
|                                    
|                                     | Purchased in-process research and development               |                          |         | 4,680   |        |      |         |        |        |   |         |        |       
|                                    
|                                    
|                                    
|                                    
|                                     | Amortization of intangible assets                           |                          |         | 7,748   |        |      |         | 9,440   |        |   |         | 9,850   |       
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|                                     |                                                             | Total operating expenses |         |         | 76,495 |      |         |         | 78,674 |   |         |         | 88,776 | 
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|Operating income                     |                                                             |                          | 38,742  |         |        |      | 50,946  |         |        |   | 58,310  |        
|                                    
|                                    
|                                    
|                                    
|Other expenses (income):             |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|                                    
|                                    
|                                    
|                                    
|                                     | Interest expense                                            |                          |         | 6,291   |        |      |         | 8,496   |        |   |         | 9,632   |       
|                                    
|                                    
|                                    
|                                    
|                                     | Interest income                                             |                          |         | (112    | )      |      |         | (189    | )      |   |         | (207    | )     
|                                    
|                                    
|                                    
|                                    
|                                     | Other, net                                                  |                          |         | (125    | )      |      |         | 284     |        |   |         | 72      |       
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|                                     |                                                             | Total other expense, net |         |         | 6,054  |      |         |         | 8,591  |   |         |         | 9,497  | 
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|Income before income taxes           |                                                             |                          | 32,688  |         |        |      | 42,355  |         |        |   | 48,813  |        
|                                    
|                                    
|                                    
|                                    
|Income taxes                         |                                                             |                          | 11,678  |         |        |      | 15,165  |         |        |   | 17,933  |        
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|                                     |                                                             | Net income               |         | $       | 21,010 |      |         | $       | 27,190 |   |         | $       | 30,880 | 
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|Basic earnings per share             |                                                             | $                        | 1.19    |         |        | $    | 1.54    |         |        | $ | 1.75    |        
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|Diluted earnings per share           |                                                             | $                        | 1.19    |         |        | $    | 1.54    |         |        | $ | 1.73    |        
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|Weighted average shares outstanding: |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|                                    
|                                    
|                                    
|                                    
|Basic                                |                                                             |                          | 17,601  |         |        |      | 17,624  |         |        |   | 17,652  |        
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        
|Diluted                              |                                                             |                          | 17,723  |         |        |      | 17,696  |         |        |   | 17,835  |        
|                                     |                                                             |                          |         |         |        |      |         |         |        |   |         |        

See accompanying notes to consolidated financial statements.

26



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BACOU USA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY

(in thousands)


|                                                                        |  |        |        |        |  |            |    |          |  |               |        |   |  |   |         |   |  |   |         |  
|----------------------------------------------------------------------- |  | ------ | ------ | ------ |  | ---------- | -- | -------- |  | ------------- | ------ | - |  | - | ------- | - |  | - | ------- | -
|                                                                        |  |        |        |        |  | Additional |    |          |  |              
|                                                                        |  | Common |        | Common |  | Paid-in    |    | Retained |  | Stockholders
|                                                                        |  | Shares |        | Stock  |  | Capital    |    | Earnings |  | Equity       
|                                                                        |  |        |        |        |  |            |    |          |  |              
|Balances at December 31, 1997                                           |  |        | 17,591 |        |  | $          | 17 |          |  | $             | 62,588 |   |  | $ | 60,297  |   |  | $ | 122,902 |  
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Repurchase of shares; retirement of shares to authorized and
	unissued  |  |        | (3     | )      |  |            |   |          |  |               | (46    | ) |  |   |        |   |  |   | (46     | )
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Fair value of stock options granted pursuant to a consulting
	agreement |  |        |       |        |  |            |   |          |  |               | 337    |   |  |   |        |   |  |   | 337     |  
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Stock options exercised                                                 |  |        | 22     |        |  |            |   |          |  |               | 379    |   |  |   |        |   |  |   | 379     |  
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Other                                                                   |  |        |       |        |  |            |   |          |  |               |       |   |  |   | (120    | ) |  |   | (120    | )
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Net income                                                              |  |        |       |        |  |            |   |          |  |               |       |   |  |   | 21,010  |   |  |   | 21,010  |  
|                                                                        |  |        |        |        |  |            |    |          |  |               |        |   |  |   |         |   |  |   |         |  
|Balances at December 31, 1998                                           |  |        | 17,610 |        |  |            | 17 |          |  |               | 63,258 |   |  |   | 81,187  |   |  |   | 144,462 |  
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Expiration of put option                                                |  |        |       |        |  |            | 1  |          |  |               | 9,449  |   |  |   |        |   |  |   | 9,450   |  
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Stock options exercised                                                 |  |        | 20     |        |  |            |   |          |  |               | 353    |   |  |   |        |   |  |   | 353     |  
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Net income                                                              |  |        |       |        |  |            |   |          |  |               |       |   |  |   | 27,190  |   |  |   | 27,190  |  
|                                                                        |  |        |        |        |  |            |    |          |  |               |        |   |  |   |         |   |  |   |         |  
|Balances at December 31, 1999                                           |  |        | 17,630 |        |  |            | 18 |          |  |               | 73,060 |   |  |   | 108,377 |   |  |   | 181,455 |  
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Stock options exercised                                                 |  |        | 41     |        |  |            |   |          |  |               | 740    |   |  |   |        |   |  |   | 740     |  
|                                                                       
|                                                                       
|                                                                       
|                                                                       
|Net income                                                              |  |        |       |        |  |            |   |          |  |               |       |   |  |   | 30,880  |   |  |   | 30,880  |  
|                                                                        |  |        |        |        |  |            |    |          |  |               |        |   |  |   |         |   |  |   |         |  
|Balances at December 31, 2000                                           |  |        | 17,671 |        |  | $          | 18 |          |  | $             | 73,800 |   |  | $ | 139,257 |   |  | $ | 213,075 |  
|                                                                        |  |        |        |        |  |            |    |          |  |               |        |   |  |   |         |   |  |   |         |  

See accompanying notes to consolidated financial statements.

27



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BACOU USA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)


|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |         |        |         |         |  
|---------------------------------------------------- | --------------------------------------------------------------------------------------- | ------------------------------------------------------------------------ | -------------------------------------- | --------------------------------------------------- | ------ | ------- | -------- | ------- | ------ | ------ | ------- | ------- | ------ | ------- | ------- | -
|                                                     |                                                                                         |                                                                         
|                                                     |                                                                                         | Years Ended December 31,                                                
|                                                     |                                                                                         |                                                                         
|                                                     |                                                                                         | 1998                                                                     |                                        | 1999                                                |        | 2000   
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |        
|Cash flows from operating activities:                |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Net income                                                                              |                                                                          | $                                      | 21,010                                              |        |         | $        | 27,190  |        |        | $       | 30,880  |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Adjustments to reconcile net income to net cash provided by
	operating activities:      |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |         |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         | Depreciation and amortization                                            |                                        |                                                     | 14,154 |         |          |         | 17,287 |        |         |         | 19,398 |        
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         | Deferred income taxes                                                    |                                        |                                                     | (176   | )       |          |         | 3,621  |        |         |         | 3,886  |        
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         | Purchased in-process research and development                            |                                        |                                                     | 4,680  |         |          |         |       |        |         |         |       |        
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         | Change in assets and liabilities, net of effects of acquired
	companies: |                                        |                                                     |        |         |          |         |        |        |         |         |        |        
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         |                                                                          | Trade accounts receivable              |                                                     |        | (6,677  | )        |         |        | (8,206 | )       |         |        | (10,958 | )      
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         |                                                                          | Inventories                            |                                                     |        | (10,162 | )        |         |        | 5,718  |         |         |        | (2,145  | )      
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         |                                                                          | Other current assets                   |                                                     |        | 2,997   |          |         |        | 415    |         |         |        | (241    | )      
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         |                                                                          | Accounts payable                       |                                                     |        | 1,949   |          |         |        | (1,229 | )       |         |        | (765    | )      
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         |                                                                          | Accrued expenses and other liabilities |                                                     |        | 4,745   |          |         |        | 747    |         |         |        | (4,469  | )      
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     |                                                                                         |                                                                          | Income taxes                           |                                                     |        | 797     |          |         |        | (602   | )       |         |        | 811     |        
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                     |                                                                                         |                                                                          |                                        | Net cash provided by operating activities           |        |         | 33,317   |         |        |        | 44,941  |         |        |         | 36,397  |  
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|Cash flows from investing activities:                |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Decrease (increase) in other assets                                                     |                                                                          |                                        | (182                                                | )      |         |          | (2,850  | )      |        |         | 85      |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Capital expenditures                                                                    |                                                                          |                                        | (14,386                                             | )      |         |          | (18,873 | )      |        |         | (13,403 | )     
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Cash received from insurance proceeds and asset disposals                               |                                                                          |                                        |                                                    |        |         |          |        |        |        |         | 1,556   |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Acquisition of businesses, including direct costs of
	acquisition, net of cash acquired |                                                                          |                                        | (121,094                                            | )      |         |          | (37,381 | )      |        |         | (16,661 | )     
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                     |                                                                                         |                                                                          |                                        | Net cash used in investing activities               |        |         | (135,662 | )       |        |        | (59,104 | )       |        |         | (28,423 | )
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|Cash flows from financing activities:                |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Repayment of long-term debt                                                             |                                                                          |                                        | (17,725                                             | )      |         |          | (21,806 | )      |        |         | (23,206 | )     
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Proceeds from long-term debt                                                            |                                                                          |                                        | 110,000                                             |        |         |          | 61,160  |        |        |         |        |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Advances (repayments) under notes payable, net                                          |                                                                          |                                        | 9,550                                               |        |         |          | (16,362 | )      |        |         | 5,200   |       
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Proceeds from issuance of common stock                                                  |                                                                          |                                        | 333                                                 |        |         |          | 353     |        |        |         | 740     |       
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                     |                                                                                         |                                                                          |                                        | Net cash provided by (used in) financing activities |        |         | 102,158  |         |        |        | 23,345  |         |        |         | (17,266 | )
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|Net increase (decrease) in cash and cash equivalents |                                                                                         |                                                                          | (187                                   | )                                                   |        |         | 9,182    |         |        |        | (9,292  | )      
|                                                    
|                                                    
|                                                    
|                                                    
|Cash and cash equivalents at beginning of year       |                                                                                         |                                                                          | 1,277                                  |                                                     |        |         | 1,090    |         |        |        | 10,272  |        
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|Cash and cash equivalents at end of year             |                                                                                         | $                                                                        | 1,090                                  |                                                     |        | $       | 10,272   |         |        | $      | 980     |        
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|Supplemental disclosures of cash flow information:   |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                    
|                                                    
|                                                    
|                                                    
|                                                     | Cash paid during the year for interest                                                  |                                                                          | $                                      | 5,796                                               |        |         | $        | 8,356   |        |        | $       | 9,942   |       
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                     | Cash paid during the year for income taxes                                              |                                                                          | $                                      | 11,308                                              |        |         | $        | 12,605  |        |        | $       | 12,993  |       
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                     | Expiration of put option                                                                |                                                                          | $                                      |                                                    |        |         | $        | 9,450   |        |        | $       |        |       
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        
|                                                     | Fair value of stock options granted pursuant to a consulting
	agreement                 |                                                                          | $                                      | 337                                                 |        |         | $        |        |        |        | $       |        |       
|                                                     |                                                                                         |                                                                          |                                        |                                                     |        |         |          |         |        |        |         |        

See accompanying notes to consolidated financial statements.

28



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)  Summary of Significant Accounting Policies

(a)  Nature of Business and
Principles of Consolidation

The accompanying consolidated financial statements include the
accounts of Bacou USA, Inc. (Bacou) and its wholly
owned subsidiaries (collectively, Company). All
significant intercompany transactions and balances have been
eliminated in consolidation.

The Company designs, manufactures and sells leading brands of
products that protect the sight, hearing, respiratory systems
and hands of workers against occupational hazards. The Company
relies on single sources for the supply of several raw
materials. The loss of any such source, any disruption in such
sources business or failure by it to meet the
Companys needs on a timely basis, could cause shortages in
raw materials and could have a material adverse effect on the
Companys results of operations. The Company has 176
employees (representing approximately 7% of total employees)
that are covered under two collective bargaining agreements that
expire on September 13, 2002 with respect to 91 employees
and on March 6, 2003 with respect to 85 employees.

Bacou S.A., a company domiciled in Valence, France, owns a
controlling interest (approximately 71% at December 31,
2000) in Bacou. The Company purchases certain inventory items
from Bacou S.A. and its subsidiaries. These purchases totaled
$24,000 in 1998, $1,049,000 in 1999 and $3,843,000 in 2000.
Sales by the Company to Bacou S.A. totaled $967,000 in 1998,
$1,925,000 in 1999 and $4,239,000 in 2000.

(b)  Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company
considers all highly liquid debt instruments purchased with an
original maturity of three months or less to be cash equivalents.

(c)  Revenue and Trade Receivables

The Company recognizes revenue upon shipment of merchandise to
its customers. Rebates or discounts offered to customers at the
point of sale are recorded as a reduction of revenue. The
Companys sales are primarily domestic with customers
located throughout the United States. Pursuant to an agreement
with the former owner of the Uvex Safety business, the Company
may sell personal protective equipment under the
uvex® brand name only in North, Central and South
America. The agreement also prohibits the Company from selling
sports products such as sunglasses or protective eyewear for
sports activities under the uvex® brand name
regardless of geographic area.

Financial instruments that potentially subject the Company to
concentrations of credit risk consist primarily of trade
receivables. The Company performs ongoing credit evaluations of
its customers and generally does not require collateral. The
Company estimates an allowance for doubtful accounts based on
the credit worthiness of its customers as well as general
economic conditions. Consequently, an adverse change in those
factors could affect the Companys estimate. The allowance
for doubtful accounts was $1,150,000 at December 31, 1998,
$1,168,000 at December 31, 1999 and $1,391,000 at
December 31, 2000.

(d)  Shipping-Handling Fees and
Costs

Shipping and handling costs include payments to third parties
for the delivery of products to customers, as well as internal
salaries and overhead costs incurred to store, move and prepare
finished products for shipment. Shipping and handling costs are
included with selling expenses in the accompanying consolidated
income statements and totaled $7,400,000 in 1998, $9,027,000 in
1999 and $11,623,000 in 2000. The Company generally only
recovers a small portion of its total shipping and handling
costs from customers. In September 2000, the Financial
Accounting Standards Board Emerging Issues Task Force reached a
consensus on Issue No. 00-10 Accounting for Shipping
and Handling Fees and Costs. This pronouncement was

29



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

effective for the Company beginning on October 1, 2000, and
required that amounts billed to customers for shipping and
handling should be classified as sales. Prior to the effective
date, reimbursements received from customers for shipping and
handling costs had been classified as a reduction of the related
expense. As required by this pronouncement, the Company has
reclassified reimbursements for all prior periods presented to
sales, including reimbursements totaling $1,512,000 in 1998,
$1,861,000 in 1999 and $2,495,000 in 2000.

(e)  Inventories

Inventories are stated at the lower of cost (first-in,
first-out) or market (net realizable value). Inventories include
the cost of raw materials, direct labor and manufacturing
overhead.

(f)  Property and Equipment

Property and equipment are stated at cost. The Company
capitalizes payments to third-parties, and certain internal
costs, incurred to obtain internal-use software. Assets to be
disposed of are reported at the lower of carrying amount or
estimated fair value less costs to sell. Depreciation is
provided over the estimated useful lives of the respective
assets using the straight-line method. Leasehold improvements
are amortized over the shorter of the lease term or estimated
useful life of the asset. Costs to repair and maintain property
and equipment are charged to operating expenses when incurred.

(g)  Intangible Assets

Intangible assets consist principally of intellectual property
and patents, customer relationships, tradenames and goodwill.
Goodwill represents the excess of purchase price over fair value
of net assets acquired in connection with purchase business
combinations. Intangible assets are amortized using the
straight-line method over the estimated periods benefited.

The Company evaluates impairment of intangible assets annually,
or more frequently if events or changes in circumstances
indicate that carrying amounts may no longer be recoverable.
Goodwill associated with assets acquired in a purchase business
combination is included in impairment evaluations when events or
circumstances exist that indicate the carrying amount of those
assets may not be recoverable. Recoverability of intangible
assets is determined based upon the excess of carrying amounts
over expected future net cash flows (undiscounted) of the
underlying business or product line. The assessment of the
recoverability of intangible assets may be affected if estimated
future net cash flows are subsequently changed.

(h)  Investments in Affiliated
Companies

Other non-current assets include investments in Uvex (UK)
Limited and Uvex Safety Australia Pty. Limited, representing 15%
of the outstanding common shares of each company. Investments
are accounted for by the cost method.

(i)  Income Taxes

The Company accounts for income taxes using the asset and
liability method. Under the asset and liability method, deferred
tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities
and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to
apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates
is recognized in income in the period that includes the
enactment date.

30



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

(j)  Foreign Currency

The Company periodically enters into forward foreign exchange
contracts in connection with purchases denominated in foreign
currencies. Other than these contracts, the Company has no other
involvement with derivative financial instruments. Transaction
gains and losses were not material during any period presented
in the accompanying financial statements. The Company had no
material open currency contracts at December 31, 2000.

(k)  Employee Benefit Plans

The Company grants stock options pursuant to certain stock
incentive plans. Stock option grants to employees and directors
are accounted for using the intrinsic value-based method.

The Company sponsors defined contribution plans that cover
substantially all employees. The Company also sponsors a defined
benefit pension plan for certain bargaining unit employees,
which is funded in accordance with the requirements of the
Employee Retirement Income Security Act, and has assets that
consist principally of mutual funds.

(l)  Earnings Per Share

Basic earnings per share are computed by dividing income
available to common stockholders by the weighted-average number
of common shares outstanding during the period. Diluted earnings
per share are computed by increasing the weighted-average number
of common shares by the dilutive potential common shares that
were outstanding during the period.

Dilutive potential common shares during all periods presented
were limited to the effect of outstanding stock options
determined by application of the treasury stock method. Dilutive
stock options included in the computation of diluted earnings
per share totaled 121,812 in 1998, 72,305 in 1999 and 183,261 in
2000. Based on the purchase agreement with the stockholders of
Biosystems, Inc., if certain earnings targets are met, the
Company may have to issue common stock to these former
stockholders. We have not included any such contingent shares in
the computation of earnings per share because the necessary
conditions for issuance of these shares had not been satisfied.

(m)  Financial Instruments

Financial instruments of the Company consist of cash, accounts
receivable, accounts payable and long-term debt. The carrying
amounts of these financial instruments approximate their fair
value.

(n)  Research and Development

Research and development costs are expensed as incurred and
totaled $4,000,000 in 1998, $5,274,000 in 1999 and $5,643,000 in
2000.

(o)  Use of Estimates

Management of the Company has made a number of estimates and
assumptions relating to the reporting of assets and liabilities
and the disclosure of contingent assets and liabilities to
prepare these financial statements in conformity with generally
accepted accounting principles. Actual results could differ from
those estimates.

31



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

(2)  Acquisitions

Effective June 30, 2000, the Company purchased
substantially all the assets and assumed substantially all
liabilities of the Whiting+Davis Safety division of WDC
Holdings, Inc. (Whiting+Davis), a manufacturer and
distributor of metal mesh protective gloves, sleeves and apparel.

On April 1, 1999, the Company purchased the assets and
assumed substantially all liabilities of Perfect Fit Glove Co.,
Inc. and certain affiliates (Perfect Fit), a
manufacturer and distributor of protective gloves and other
related products, for cash consideration of $37.1 million. In
accordance with provisions of the related asset purchase
agreement, the Company paid additional contingent cash
consideration equal to $5.1 million in March 2000. The
accompanying balance sheet includes an accrual at
December 31, 1999, equal to the contingent consideration
paid in March 2000.

Effective February 27, 1998, the Company acquired
substantially all assets and assumed substantially all
liabilities of Howard S. Leight & Associates, Inc.
(HLA), a manufacturer of hearing protection products
(including disposable, reusable and banded ear plugs, and ear
muffs) for cash consideration of $125.9 million, $5.9 million of
which represented the refinancing of HLA indebtedness.

Effective September 30, 1997, the Company acquired all of
the capital stock of Biosystems, Inc., a manufacturer of gas
monitors and equipment for testing self-contained breathing
apparatus, in exchange for 826,514 shares of its common stock
having a fair market value equal to $13.5 million. The initial
acquisition price may be increased according to a sliding scale
if the operating results of Biosystems in the year 2000 exceed
certain defined thresholds. Preliminary indications are that a
contingent payment is not due, however, a final determination on
this matter is not required to be made until April 15, 2001
and may be subject to arbitration provisions after that date.

In accordance with generally accepted accounting principles, the
cash paid and stock issued to effect these acquisitions was
allocated to the fair value of assets purchased and liabilities
assumed. In each case, the excess of acquisition price over fair
value of net assets acquired was recorded as goodwill and is
being amortized over 30-40 years. In connection with the
1998 acquisition of HLA, the fair value of purchased in-process
research and development was $4.7 million. This value was
determined based upon future cash flows expected to result from
development of the related project, discounted at a
risk-adjusted rate equal to 21%, and based upon an assumption
that the project was 73% complete as of the date of acquisition.
The percent complete was based upon an assessment of
(i) cost incurred through the acquisition date,
(ii) estimated remaining cost to complete,
(iii) complexity of the work completed to date and
(iv) difficulty of completing the remaining development.
Acquired in-process research and development had not yet reached
technological feasibility and had no alternative future uses,
accordingly, the fair value assigned to the project was expensed
as of the acquisition date.

The purchase price for the acquisition of Perfect Fit has been
allocated approximately as shown in the following table (in
thousands).

|                               |  |             |        |  
|------------------------------ |  | ----------- | ------ | -
|                               |  | Perfect Fit
|                               |  |            
|Working capital                |  | $           | 5,400  |  
|                              
|                              
|                              
|                              
|Property and equipment         |  |             | 9,400  |  
|                              
|                              
|                              
|                              
|Identifiable intangible assets |  |             | 800    |  
|                              
|                              
|                              
|                              
|Long-term debt                 |  |             | (6,300 | )
|                              
|                              
|                              
|                              
|Goodwill                       |  |             | 32,900 |  

Disclosure of the allocation of purchase price for
Whiting+Davis, and pro forma operating results relating to the
Perfect Fit and Whiting+Davis acquisitions, have been omitted
because such information was not material.

32



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BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

(3) Inventories

Inventories included the following at December 31 (in
thousands):

|                           |  |      |        |      |  |   |        | 
|-------------------------- |  | ---- | ------ | ---- |  | - | ------ | 
|                           |  | 1999 |        | 2000
|                           |  |      |        |     
|Raw materials and supplies |  | $    | 16,137 |      |  | $ | 16,103 | 
|                          
|                          
|                          
|                          
|Work-in-process            |  |      | 4,629  |      |  |   | 6,008  | 
|                          
|                          
|                          
|                          
|Finished goods             |  |      | 21,667 |      |  |   | 23,393 | 
|                           |  |      |        |      |  |   |        | 
|                           |  | $    | 42,433 |      |  | $ | 45,504 | 
|                           |  |      |        |      |  |   |        | 

(4) Property and Equipment

Property and equipment included the following at
December 31 (in thousands):

|                                               |  |               |       |      |  |      |        |  |  |   |         | 
|---------------------------------------------- |  | ------------- | ----- | ---- |  | ---- | ------ |  |  | - | ------- | 
|                                               |  | Estimated     |       |      |  |     
|                                               |  | Useful        |       |      |  |     
|                                               |  | Lives (Years) |       | 1999 |  | 2000
|                                               |  |               |       |      |  |     
|Machinery and equipment                        |  |               | 5-10  |      |  | $    | 41,470 |  |  | $ | 50,238  | 
|                                              
|                                              
|                                              
|                                              
|Dies and molds                                 |  |               | 5     |      |  |      | 15,156 |  |  |   | 17,605  | 
|                                              
|                                              
|                                              
|                                              
|Buildings and leasehold improvements           |  |               | 10-40 |      |  |      | 24,393 |  |  |   | 29,458  | 
|                                              
|                                              
|                                              
|                                              
|Computer equipment and software                |  |               | 5-10  |      |  |      | 8,216  |  |  |   | 10,580  | 
|                                              
|                                              
|                                              
|                                              
|Furniture, fixtures and other                  |  |               | 3-10  |      |  |      | 3,717  |  |  |   | 3,390   | 
|                                              
|                                              
|                                              
|                                              
|Deposits and construction in progress          |  |               |       |      |  |      | 6,898  |  |  |   | 1,536   | 
|                                               |  |               |       |      |  |      |        |  |  |   |         | 
|                                               |  |               |       |      |  |      | 99,850 |  |  |   | 112,807 | 
|                                              
|                                              
|                                              
|                                              
|Less accumulated depreciation and amortization |  |               |       |      |  |      | 25,440 |  |  |   | 34,415  | 
|                                               |  |               |       |      |  |      |        |  |  |   |         | 
|                                               |  |               |       |      |  | $    | 74,410 |  |  | $ | 78,392  | 
|                                               |  |               |       |      |  |      |        |  |  |   |         | 

Depreciation expense was $6,406,000 in 1998, $7,847,000 in 1999
and $9,548,000 in 2000.

(5) Intangible Assets

The value of identifiable intangible assets is generally
determined by independent appraisal at the date of acquisition.
Intangible assets included the following at December 31 (in
thousands):

|                                  |  |               |       |      |  |      |         |  |  |   |         | 
|--------------------------------- |  | ------------- | ----- | ---- |  | ---- | ------- |  |  | - | ------- | 
|                                  |  | Estimated     |       |      |  |     
|                                  |  | Useful        |       |      |  |     
|                                  |  | Lives (Years) |       | 1999 |  | 2000
|                                  |  |               |       |      |  |     
|Intellectual property and patents |  |               | 9-30  |      |  | $    | 102,371 |  |  | $ | 102,371 | 
|                                 
|                                 
|                                 
|                                 
|Customer relationships            |  |               | 10-20 |      |  |      | 19,523  |  |  |   | 19,523  | 
|                                 
|                                 
|                                 
|                                 
|Tradenames and other intangibles  |  |               | 6-30  |      |  |      | 5,418   |  |  |   | 5,418   | 
|                                 
|                                 
|                                 
|                                 
|Goodwill                          |  |               | 20-40 |      |  |      | 96,950  |  |  |   | 107,067 | 
|                                  |  |               |       |      |  |      |         |  |  |   |         | 
|                                  |  |               |       |      |  |      | 224,262 |  |  |   | 234,379 | 
|                                 
|                                 
|                                 
|                                 
|Less accumulated amortization     |  |               |       |      |  |      | 30,004  |  |  |   | 39,923  | 
|                                  |  |               |       |      |  |      |         |  |  |   |         | 
|                                  |  |               |       |      |  | $    | 194,258 |  |  | $ | 194,456 | 
|                                  |  |               |       |      |  |      |         |  |  |   |         | 

33



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

(6) Income Taxes

Total federal and state income tax expense included the
following (in thousands):

|                              |         |         |        |          |  |       |       |       |   |   |        |        | 
|----------------------------- | ------- | ------- | ------ | -------- |  | ----- | ----- | ----- | - | - | ------ | ------ | 
|                              |         | Current |        | Deferred |  | Total
|                              |         |         |        |          |  |      
|Year ended December 31, 1998: |         |         |        |          |  |       |       |       |   |   |        |       
|                             
|                             
|                             
|                             
|                              | Federal |         | $      | 10,735   |  |       | $     | (149  | ) |   | $      | 10,586 | 
|                             
|                             
|                             
|                             
|                              | State   |         |        | 1,119    |  |       |       | (27   | ) |   |        | 1,092  | 
|                              |         |         |        |          |  |       |       |       |   |   |        |       
|                              |         | $       | 11,854 |          |  | $     | (176  | )     |   | $ | 11,678 |       
|                              |         |         |        |          |  |       |       |       |   |   |        |       
|Year ended December 31, 1999: |         |         |        |          |  |       |       |       |   |   |        |       
|                             
|                             
|                             
|                             
|                              | Federal |         | $      | 10,890   |  |       | $     | 3,259 |   |   | $      | 14,149 | 
|                             
|                             
|                             
|                             
|                              | State   |         |        | 654      |  |       |       | 362   |   |   |        | 1,016  | 
|                              |         |         |        |          |  |       |       |       |   |   |        |       
|                              |         | $       | 11,544 |          |  | $     | 3,621 |       |   | $ | 15,165 |       
|                              |         |         |        |          |  |       |       |       |   |   |        |       
|Year ended December 31, 2000: |         |         |        |          |  |       |       |       |   |   |        |       
|                             
|                             
|                             
|                             
|                              | Federal |         | $      | 13,043   |  |       | $     | 3,529 |   |   | $      | 16,572 | 
|                             
|                             
|                             
|                             
|                              | State   |         |        | 1,004    |  |       |       | 357   |   |   |        | 1,361  | 
|                              |         |         |        |          |  |       |       |       |   |   |        |       
|                              |         | $       | 14,047 |          |  | $     | 3,886 |       |   | $ | 17,933 |       
|                              |         |         |        |          |  |       |       |       |   |   |        |       

Actual income tax expense differs from expected income tax
expense (computed by applying the statutory U.S. Federal
corporate income tax rate to income before income taxes) as
follows (in thousands, except percentages):

|                                                      |  |                          |        |      |  |      |        |   |  |   |        |  
|----------------------------------------------------- |  | ------------------------ | ------ | ---- |  | ---- | ------ | - |  | - | ------ | -
|                                                      |  |                         
|                                                      |  | Years Ended December 31,
|                                                      |  |                         
|                                                      |  | 1998                     |        | 1999 |  | 2000
|                                                      |  |                          |        |      |  |     
|Computed expected tax expense                         |  | $                        | 11,441 |      |  | $    | 14,824 |   |  | $ | 17,084 |  
|                                                     
|                                                     
|                                                     
|                                                     
|State income taxes, net of federal income tax benefit |  |                          | 710    |      |  |      | 660    |   |  |   | 885    |  
|                                                     
|                                                     
|                                                     
|                                                     
|Estimated non-deductible capital costs                |  |                          |       |      |  |      |       |   |  |   | 394    |  
|                                                     
|                                                     
|                                                     
|                                                     
|Net tax benefit of foreign sales corporation          |  |                          | (394   | )    |  |      | (369   | ) |  |   | (441   | )
|                                                     
|                                                     
|                                                     
|                                                     
|Other                                                 |  |                          | (79    | )    |  |      | 50     |   |  |   | 11     |  
|                                                      |  |                          |        |      |  |      |        |   |  |   |        |  
|                                                      |  | $                        | 11,678 |      |  | $    | 15,165 |   |  | $ | 17,933 |  
|                                                      |  |                          |        |      |  |      |        |   |  |   |        |  
|Effective rate                                        |  |                          | 35.7   | %    |  |      | 35.8   | % |  |   | 36.7   | %
|                                                      |  |                          |        |      |  |      |        |   |  |   |        |  

The tax effects of temporary differences that generate deferred
tax assets and liabilities at December 31 are as follows
(in thousands):

|                          |                                                  |                                 |   |        |        |  |   |        |        | 
|------------------------- | ------------------------------------------------ | ------------------------------- | - | ------ | ------ |  | - | ------ | ------ | 
|                          |                                                  | 1999                            |   | 2000  
|                          |                                                  |                                 |   |       
|Deferred tax assets:      |                                                  |                                 |   |        |        |  |   |       
|                         
|                         
|                         
|                         
|                          | Allowance for doubtful accounts                  |                                 | $ | 375    |        |  | $ | 468    |       
|                         
|                         
|                         
|                         
|                          | Inventory related items                          |                                 |   | 1,344  |        |  |   | 1,595  |       
|                         
|                         
|                         
|                         
|                          | Pension and compensation related expenses        |                                 |   | 963    |        |  |   | 664    |       
|                         
|                         
|                         
|                         
|                          | Accrued costs                                    |                                 |   | 971    |        |  |   | 695    |       
|                         
|                         
|                         
|                         
|                          | Other                                            |                                 |   | 392    |        |  |   | 494    |       
|                          |                                                  |                                 |   |        |        |  |   |       
|                          |                                                  | Total gross deferred tax assets |   |        | 4,045  |  |   |        | 3,916  | 
|                         
|                         
|                         
|                         
|                          |                                                  | Less valuation allowance        |   |        |       |  |   |        |       | 
|                          |                                                  |                                 |   |        |        |  |   |       
|                          |                                                  | Net deferred tax assets         |   |        | 4,045  |  |   |        | 3,916  | 
|                          |                                                  |                                 |   |        |        |  |   |       
|Deferred tax liabilities: |                                                  |                                 |   |        |        |  |   |       
|                         
|                         
|                         
|                         
|                          | Basis differences in fixed and intangible assets |                                 |   | 11,370 |        |  |   | 14,825 |       
|                         
|                         
|                         
|                         
|                          | Other                                            |                                 |   | 492    |        |  |   | 991    |       
|                          |                                                  |                                 |   |        |        |  |   |       
|                          |                                                  | Total deferred tax liabilities  |   |        | 11,862 |  |   |        | 15,816 | 
|                          |                                                  |                                 |   |        |        |  |   |       
|                          |                                                  | Net deferred tax liability      |   | $      | 7,817  |  |   | $      | 11,900 | 
|                          |                                                  |                                 |   |        |        |  |   |       

34



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

(7) Long-term Debt

Long-term debt at December 31 consisted of the following
(in thousands):

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |      |         |      |  |   |         | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ------- | ---- |  | - | ------- | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | 1999 |         | 2000
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |      |         |     
|Term note with Banque Nationale de Paris in the original
	principal amount of $110,000,000; principal payments due in
	equal quarterly installments over seven years through
	February 2005; interest due quarterly at an annual rate
	equal to three-month                                                                                                                                                                                                                                                 |  | $    | 82,500  |      |  | $ | 66,785  | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|LIBOR (6.4% at December 31, 2000) plus 0.50% Term note with
	Banque Nationale de Paris in the original principal amount of
	$50,000,000; principal payments due in equal quarterly
	installments over seven years through March 2006; interest
	due quarterly at an annual rate equal to three-month LIBOR plus
	0.60%                                                                                                                                                                                      |  |      | 44,643  |      |  |   | 37,500  | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Rhode Island Industrial Facilities Corporation Revenue Bonds in
	the maximum principal amount of $30,000,000; principal
	outstanding is due in quarterly installments of $500,000
	beginning February 1, 2002, increasing to $1,500,000
	beginning February 1, 2005, with a final payment of any
	remaining principal due on August 1, 2006; bearing interest
	at rates ranging from LIBOR plus 0.70% to LIBOR plus 0.95%
	during its term; secured by property and equipment purchased
	with bond proceeds |  |      | 11,160  |      |  |   | 11,160  | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Wilkes County Industrial Facilities (Wilkes County)
	Revenue Bonds; interest payable quarterly at a variable rate
	(averaging 4.3% during 2000); secured by an irrevocable letter
	of credit; principal payment due in full on December  31,
	2006                                                                                                                                                                                                                                                        |  |      | 5,590   |      |  |   | 5,590   | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Revolving line of credit facility with Fleet National Bank in
	the maximum principal amount of $36,000,000; due in full on
	August 24, 2001, bearing interest at an annual rate equal
	to, at the election of the Company, either (a) LIBOR plus
	0.70%, or (b) the banks floating rate                                                                                                                                                                                                                    |  |      |        |      |  |   | 5,200   | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |      |         |      |  |   |         | 
|Total long-term debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |      | 143,893 |      |  |   | 126,235 | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Current installments of long-term debt                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |      | 23,637  |      |  |   | 28,057  | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |      |         |      |  |   |         | 
|Long-term debt, excluding current installments                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | $    | 120,256 |      |  | $ | 98,178  | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |      |         |      |  |   |         | 

Aggregate maturities of long-term debt for each of the five
years subsequent to December 31, 2000, are as follows:
2001  $28,057,000; 2002  $24,857,000;
2003  $24,857,000; 2004  $24,857,000;
2005  $16,231,000; and thereafter $7,376,000.

(8)  Commitments and Contingencies

The Company leases production, office and warehouse space, and
certain vehicles and equipment, under non-cancelable operating
leases. Minimum future rentals under non-cancelable operating
leases, by year, are approximately as follows: 2001 
$1,961,000; 2002  $1,460,000; 2003 
$907,000; 2004  $188,000; and 2005 
$187,000. Rent expense totaled approximately $1,920,000 in 1998,
$1,871,000 in 1999 and $1,975,000 in 2000.

The Company had outstanding letters of credit, including an
irrevocable letter of credit to secure payment of outstanding
principal on the Wilkes County Revenue Bonds, equal to
approximately $5,791,000 at December 31, 2000.

The Company is currently involved as a defendant in litigation
incidental to its business, which the Company believes is
without merit or is adequately covered by insurance. In the
opinion of management, the ultimate resolution of such
litigation will not have a material adverse effect on the
Companys financial position, results of operations or cash
flows.

The Company is self-insured for certain workers
compensation claims and records a provision for estimated claims
incurred but not reported.

35



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

(9)  Employee Benefit Plans

(a)  Defined Contribution Plans

The Company sponsors defined contribution plans for all eligible
employees. Employer contribution expense totaled approximately
$836,000 in 1998, $982,000 in 1999 and $983,000 in 2000.

(b) Defined Benefit Plan

The Company sponsors a defined benefit pension plan covering
certain bargaining unit employees. Benefits are based on years
of service multiplied by a predetermined monthly amount. The
Companys policy is to fund the minimum required
contribution subject to any full funding limitation. Assumptions
used to develop the projected benefit obligation were a discount
rate of 6.75% in 1998, 7.5% in 1999 and 2000, and a long-term
rate of return on assets of 8.5% during all years presented. The
following table sets forth the benefit obligation, assets at
fair value, and funded status of the plan at December 31
(in thousands):

|                                                        |  |      |       |      |  |   |       |  
|------------------------------------------------------- |  | ---- | ----- | ---- |  | - | ----- | -
|                                                        |  | 1999 |       | 2000
|                                                        |  |      |       |     
|Benefit Obligation                                      |  |      |       |      |  |   |       |  
|                                                       
|                                                       
|                                                       
|                                                       
|Benefit obligation at beginning of year                 |  | $    | 1,761 |      |  | $ | 1,666 |  
|                                                       
|                                                       
|                                                       
|                                                       
|Service cost                                            |  |      | 56    |      |  |   | 40    |  
|                                                       
|                                                       
|                                                       
|                                                       
|Interest cost                                           |  |      | 118   |      |  |   | 123   |  
|                                                       
|                                                       
|                                                       
|                                                       
|Benefit payments                                        |  |      | (40   | )    |  |   | (48   | )
|                                                       
|                                                       
|                                                       
|                                                       
|Actuarial (gain) loss                                   |  |      | (229  | )    |  |   | 91    |  
|                                                        |  |      |       |      |  |   |       |  
|Benefit obligation at end of year                       |  | $    | 1,666 |      |  | $ | 1,872 |  
|                                                        |  |      |       |      |  |   |       |  
|Assets at Fair Value                                    |  |      |       |      |  |   |       |  
|                                                       
|                                                       
|                                                       
|                                                       
|Fair value of assets at beginning of year               |  | $    | 1,041 |      |  | $ | 1,240 |  
|                                                       
|                                                       
|                                                       
|                                                       
|Actual return on assets                                 |  |      | 48    |      |  |   | (17   | )
|                                                       
|                                                       
|                                                       
|                                                       
|Contributions                                           |  |      | 191   |      |  |   | 211   |  
|                                                       
|                                                       
|                                                       
|                                                       
|Benefit payments                                        |  |      | (40   | )    |  |   | (48   | )
|                                                        |  |      |       |      |  |   |       |  
|Fair value of assets at end of year                     |  | $    | 1,240 |      |  | $ | 1,386 |  
|                                                        |  |      |       |      |  |   |       |  
|Funded Status                                           |  |      |       |      |  |   |       |  
|                                                       
|                                                       
|                                                       
|                                                       
|Benefit obligation                                      |  | $    | 1,666 |      |  | $ | 1,872 |  
|                                                       
|                                                       
|                                                       
|                                                       
|Assets at fair value                                    |  |      | 1,240 |      |  |   | 1,386 |  
|                                                        |  |      |       |      |  |   |       |  
|Net underfunded obligation                              |  | $    | 426   |      |  | $ | 486   |  
|                                                        |  |      |       |      |  |   |       |  
|Accrued benefit liability included in the balance sheet |  | $    | 426   |      |  | $ | 486   |  
|                                                        |  |      |       |      |  |   |       |  

Periodic pension cost during the years ended December 31,
1998, 1999 and 2000 included the following (in thousands):

|                              |  |      |     |      |  |      |     |   |  |   |      |  
|----------------------------- |  | ---- | --- | ---- |  | ---- | --- | - |  | - | ---- | -
|                              |  | 1998 |     | 1999 |  | 2000
|                              |  |      |     |      |  |     
|Service cost                  |  | $    | 47  |      |  | $    | 56  |   |  | $ | 40   |  
|                             
|                             
|                             
|                             
|Interest cost                 |  |      | 109 |      |  |      | 118 |   |  |   | 123  |  
|                             
|                             
|                             
|                             
|Actual return on assets       |  |      | (71 | )    |  |      | (48 | ) |  |   | 17   |  
|                             
|                             
|                             
|                             
|Net amortization and deferral |  |      | (1  | )    |  |      | (36 | ) |  |   | (120 | )
|                              |  |      |     |      |  |      |     |   |  |   |      |  
|Periodic pension cost         |  | $    | 84  |      |  | $    | 90  |   |  | $ | 60   |  
|                              |  |      |     |      |  |      |     |   |  |   |      |  

(c)  Stock Incentive Plans

The Bacou USA, Inc. 1996 Stock Incentive Plan (Employee
Plan) provides for stock-based incentive awards to be
granted to key employees, including incentive stock options,
non-qualified stock options, restricted stock, stock
appreciation rights and stock unit awards. In the aggregate,
1,350,000 shares of the Companys common stock have been
reserved for issuance under the Employee Plan. Options granted
under the Employee Plan generally become fully vested after four
years from the date of grant and have a ten-year term; however,
options become fully vested upon any change in control of the
Company. The Company also sponsors the Bacou USA, Inc. 1996
Non-Employee Director Stock Option Plan (Director
Plan) and the

36



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

1998 Howard S. Leight Stock Option Plan (Leight
Plan). In the aggregate, 300,000 shares of common stock
have been reserved for issuance under the Director Plan and
50,000 shares have been reserved under the Leight Plan. Options
granted under the Director Plan and the Leight Plan became fully
vested on the date of grant and have a ten-year term.

Following is a summary of stock option activity in all three
plans:

|                                 |  |           |         |                  |  |           |       |                  |  |           |         |                  |  |   |       |  |  |  |         |   |  |   |       | 
|-------------------------------- |  | --------- | ------- | ---------------- |  | --------- | ----- | ---------------- |  | --------- | ------- | ---------------- |  | - | ----- |  |  |  | ------- | - |  | - | ----- | 
|                                 |  |           |         |                  |  |          
|                                 |  | 1998      |         | 1999             |  | 2000     
|                                 |  |           |         |                  |  |          
|                                 |  | Number of |         | Weighted Average |  | Number of |       | Weighted Average |  | Number of |         | Weighted Average
|                                 |  | Shares    |         | Exercise Price   |  | Shares    |       | Exercise Price   |  | Shares    |         | Exercise Price  
|                                 |  |           |         |                  |  |           |       |                  |  |           |         |                 
|Outstanding at beginning of year |  |           | 577,900 |                  |  | $         | 15.23 |                  |  |           | 988,400 |                  |  | $ | 16.27 |  |  |  | 980,400 |   |  | $ | 16.25 | 
|                                
|                                
|                                
|                                
|Granted                          |  |           | 470,000 |                  |  |           | 17.52 |                  |  |           | 95,000  |                  |  |   | 16.99 |  |  |  | 55,000  |   |  |   | 19.14 | 
|                                
|                                
|                                
|                                
|Exercised                        |  |           | (22,500 | )                |  |           | 15.53 |                  |  |           | (19,400 | )                |  |   | 15.78 |  |  |  | (41,600 | ) |  |   | 16.94 | 
|                                
|                                
|                                
|                                
|Canceled                         |  |           | (37,000 | )                |  |           | 16.28 |                  |  |           | (83,600 | )                |  |   | 17.42 |  |  |  | (24,200 | ) |  |   | 16.36 | 
|                                 |  |           |         |                  |  |           |       |                  |  |           |         |                  |  |   |       |  |  |  |         |   |  |   |       | 
|Outstanding at end of year       |  |           | 988,400 |                  |  | $         | 16.27 |                  |  |           | 980,400 |                  |  | $ | 16.25 |  |  |  | 969,600 |   |  | $ | 16.39 | 
|                                 |  |           |         |                  |  |           |       |                  |  |           |         |                  |  |   |       |  |  |  |         |   |  |   |       | 
|Exercisable at end of year       |  |           | 525,500 |                  |  | $         | 15.90 |                  |  |           | 721,250 |                  |  | $ | 16.11 |  |  |  | 839,700 |   |  | $ | 16.27 | 
|                                 |  |           |         |                  |  |           |       |                  |  |           |         |                  |  |   |       |  |  |  |         |   |  |   |       | 

Following is a summary of options outstanding at
December 31, 2000 in all three plans:

|                    |               |                     |  |                     |         |                |  |             |      |                |  |   |       |  |  |  |         |  |  |   |       | 
|------------------- | ------------- | ------------------- |  | ------------------- | ------- | -------------- |  | ----------- | ---- | -------------- |  | - | ----- |  |  |  | ------- |  |  | - | ----- | 
|                    |               |                    
|Options Outstanding |               | Options Exercisable
|                    |               |                    
|                    |               | Weighted Average    |  | Weighted            |         |                |  | Weighted   
|Range of            |               | Number              |  | Remaining Years     |         | Average        |  | Number      |      | Average       
|Exercise Prices     |               | Outstanding         |  | of Contractual Life |         | Exercise Price |  | Exercisable |      | Exercise Price
|                    |               |                     |  |                     |         |                |  |             |      |               
|$                   | 13.00 - 15.00 |                     |  |                     | 399,200 |                |  |             | 5.75 |                |  | $ | 14.88 |  |  |  | 374,200 |  |  | $ | 14.90 | 
|                    | 15.50 - 17.75 |                     |  |                     | 525,400 |                |  |             | 7.19 |                |  |   | 17.06 |  |  |  | 428,000 |  |  |   | 17.00 | 
|                    | 21.00 - 23.75 |                     |  |                     | 45,000  |                |  |             | 8.94 |                |  |   | 21.92 |  |  |  | 37,500  |  |  |   | 21.55 | 
|                    |               |                     |  |                     |         |                |  |             |      |                |  |   |       |  |  |  |         |  |  |   |       | 
|$                   | 13.00 - 23.75 |                     |  |                     | 969,600 |                |  |             | 6.68 |                |  | $ | 16.39 |  |  |  | 839,700 |  |  | $ | 16.27 | 
|                    |               |                     |  |                     |         |                |  |             |      |                |  |   |       |  |  |  |         |  |  |   |       | 

The Company accounts for employee and director stock option
grants using the intrinsic value-based method and, accordingly,
no compensation cost has been recognized for such stock options
in the financial statements. Had the Company determined
compensation cost based on the fair value at the grant date for
its stock options, the Companys net income, and earnings
per share, would have been reduced to $19,729,000 or $1.12 per
share in 1998, $26,150,000 or $1.48 per share in 1999 and
$30,271,000 or $1.72 per share (basic) and $1.70 per share
(diluted) in 2000. The per share weighted-average fair
value of stock options granted was $7.42 in 1998, $7.45 in 1999
and $8.17 in 2000. The Black-Scholes option pricing model was
used to determine the fair value of stock options, including the
following weighted-average assumptions: expected dividend yield
0.0%; risk-free interest rate of 4.75% in 1998, 6.0% in 1999 and
5.0% in 2000; expected volatility of 0.40; and an expected life
of 5 years.

(d)  Change-in-Control
Arrangements

Effective January 1, 2000, the Company entered into new
employment agreements with four key executives. Three agreements
were for a three-year term with renewal provisions for
successive two-year terms, and the remaining agreement was for a
three-year term with renewal provisions for additional one-year
terms. Among other benefits, the agreements provide for payments
to these four individuals in the event there is a change in
control of the Company. Guaranteed minimum payments are payable
at the time of such change in control and would be equal to the
sum of (1) salary at the then-current rate payable for the
remainder of the term, (2) the maximum cash bonus available
to each employee under his agreement for the remainder of the
term, (3) the maximum stock options available to each
employee under his agreement for the remainder of the term and
to be granted at a per share price of $15.375 and (4) the
present value of all other benefits under the agreement through
the end of the term. The Company also has agreements with

37



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

certain other employees that would provide retention bonuses
equal to approximately $3,000,000 in the aggregate.

(10)  Segment Data

The Company has three reportable segments, which include the
safety segment, the glove segment and the optical frames and
instruments segment. The safety segment consists of businesses
that manufacture consumable products (protective eyewear and
hearing protection) and technical products (respirators and gas
monitors), all of which are sold principally to industrial and
fire safety distributors. The Company began reporting a glove
segment in connection with its April 1, 1999 acquisition of
Perfect Fit. Glove segment products consist of protective
gloves, sleeves, apparel and related items, which are sold
principally to industrial safety distributors. The optical
frames and instruments segment includes eyeglass frames and
components, and vision screening equipment. Eyeglass frames and
components are principally purchased by optical laboratory
customers who fit frames with prescription lenses to create
completed eyewear products.

The Company evaluates segment performance based upon a measure
of profit represented by operating income prior to non-recurring
gains and losses, intangible amortization expense, interest and
taxes. The Company allocates certain operating expenses for
legal, human resource and information system services provided
by Bacou to each segment. Accounting policies for reportable
segments are consistent with the policies described in note 1 to
the consolidated financial statements.

Presented below is a summary of financial data for the
Companys reportable segments. Adjustments to reconcile
segment operating income to consolidated operating income
include amortization expense totaling $7,748,000 in 1998,
$9,440,000 in 1999 and $9,850,000 in 2000, and also include
non-recurring items totaling $7,716,000 in 1998, $590,000 in
1999 and $1,330,000 in 2000. Information presented below as
all other includes all non-operating entities.
Amounts included below for all other capital
expenditures in 2000 have been reduced by $1,193,000 for
inter-segment transfers to the safety and glove segments.
Segment assets exclude intercompany receivables and investments
in wholly-owned subsidiaries.

|                         |  |         |         |         |  |             |        |           |  |             |        |              |  |   |        |   |  |   |         |   |  |   |         | 
|------------------------ |  | ------- | ------- | ------- |  | ----------- | ------ | --------- |  | ----------- | ------ | ------------ |  | - | ------ | - |  | - | ------- | - |  | - | ------- | 
|                         |  |         |         |         |  | Optical     |        |           |  |             |        |             
|                         |  |         |         |         |  | Frames and  |        |           |  |             |        |             
|                         |  | Safety  |         | Glove   |  | Instruments |        |           |  | Reconciling |        | Consolidated
|                         |  | Segment |         | Segment |  | Segment     |        | All Other |  | Adjustments |        | Total       
|(in thousands)           |  |         |         |         |  |             |        |           |  |             |        |             
|1998                     |  |         |         |         |  |             |        |           |  |             |        |              |  |   |        |   |  |   |         |   |  |   |         | 
|                        
|                        
|                        
|                        
|Net sales                |  | $       | 190,148 |         |  | $           |       |           |  | $           | 30,945 |              |  | $ |       |   |  | $ |        |   |  | $ | 221,093 | 
|                        
|                        
|                        
|                        
|Segment operating income |  |         | 56,741  |         |  |             |       |           |  |             | 2,481  |              |  |   | (5,016 | ) |  |   | (15,464 | ) |  |   | 38,742  | 
|                        
|                        
|                        
|                        
|Depreciation             |  |         | 5,194   |         |  |             |       |           |  |             | 1,185  |              |  |   | 27     |   |  |   |        |   |  |   | 6,406   | 
|                        
|                        
|                        
|                        
|Total assets             |  |         | 250,172 |         |  |             |       |           |  |             | 41,938 |              |  |   | 1,660  |   |  |   |        |   |  |   | 293,770 | 
|                        
|                        
|                        
|                        
|Capital expenditures     |  |         | 12,381  |         |  |             |       |           |  |             | 1,742  |              |  |   | 263    |   |  |   |        |   |  |   | 14,386  | 
|                        
|                        
|                        
|                        
|1999                     |  |         |         |         |  |             |        |           |  |             |        |              |  |   |        |   |  |   |         |   |  |   |         | 
|                        
|                        
|                        
|                        
|Net sales                |  | $       | 202,723 |         |  | $           | 39,905 |           |  | $           | 32,030 |              |  | $ |       |   |  | $ |        |   |  | $ | 274,658 | 
|                        
|                        
|                        
|                        
|Segment operating income |  |         | 59,179  |         |  |             | 5,567  |           |  |             | 2,964  |              |  |   | (6,734 | ) |  |   | (10,030 | ) |  |   | 50,946  | 
|                        
|                        
|                        
|                        
|Depreciation             |  |         | 6,179   |         |  |             | 327    |           |  |             | 1,315  |              |  |   | 26     |   |  |   |        |   |  |   | 7,847   | 
|                        
|                        
|                        
|                        
|Total assets             |  |         | 254,813 |         |  |             | 62,088 |           |  |             | 37,552 |              |  |   | 16,972 |   |  |   |        |   |  |   | 371,425 | 
|                        
|                        
|                        
|                        
|Capital expenditures     |  |         | 14,974  |         |  |             | 1,067  |           |  |             | 2,390  |              |  |   | 442    |   |  |   |        |   |  |   | 18,873  | 
|                        
|                        
|                        
|                        
|2000                     |  |         |         |         |  |             |        |           |  |             |        |              |  |   |        |   |  |   |         |   |  |   |         | 
|                        
|                        
|                        
|                        
|Net sales                |  | $       | 221,007 |         |  | $           | 68,151 |           |  | $           | 30,566 |              |  | $ |       |   |  | $ |        |   |  | $ | 319,724 | 
|                        
|                        
|                        
|                        
|Segment operating income |  |         | 60,974  |         |  |             | 9,369  |           |  |             | 3,743  |              |  |   | (4,596 | ) |  |   | (11,180 | ) |  |   | 58,310  | 
|                        
|                        
|                        
|                        
|Depreciation             |  |         | 7,188   |         |  |             | 1,040  |           |  |             | 1,115  |              |  |   | 205    |   |  |   |        |   |  |   | 9,548   | 
|                        
|                        
|                        
|                        
|Total assets             |  |         | 260,075 |         |  |             | 81,343 |           |  |             | 25,982 |              |  |   | 12,130 |   |  |   |        |   |  |   | 379,530 | 
|                        
|                        
|                        
|                        
|Capital expenditures     |  |         | 11,743  |         |  |             | 2,359  |           |  |             | 211    |              |  |   | (910   | ) |  |   |        |   |  |   | 13,403  | 

There were no sales to any individual customer during any of the
years in the three-year period ended December 31, 2000 that
represented 10% or more of consolidated sales. The Company has
no material long-lived assets located in foreign countries. The
Company attributes net sales to an individual country based upon

38



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)

the location of the customer and sales to all foreign countries
totaled $33,102,000 in 1998, $36,950,000 in 1999 and $45,528,000
in 2000. The Company had no material foreign sales to an
individual country.

(11)  Quarterly Financial Results and Market Data
(Unaudited)

Following is a summary of quarterly operating results and share
data. There were no dividends paid or declared during any period
presented and the Company anticipates that it will continue to
retain earnings for use in its business and not pay cash
dividends for the foreseeable future. Certain quarterly amounts
previously reported by the Company have been adjusted to conform
to the requirements of Emerging Issues Task Force Issue
No. 00-10 (see note 1(d)).

|                                      |         |         |        |        |  |       |        |        |  |           |        |       |  |   |        |       |  |   |         |       | 
|------------------------------------- | ------- | ------- | ------ | ------ |  | ----- | ------ | ------ |  | --------- | ------ | ----- |  | - | ------ | ----- |  | - | ------- | ----- | 
|                                      |         |         |        |       
|                                      |         | Quarter |        |       
|                                      |         |         |        |       
|                                      |         | First   |        | Second |  | Third |        | Fourth |  | Full Year
|(in thousands, except per share data) |         |         |        |        |  |       |        |        |  |          
|1999                                  |         |         |        |        |  |       |        |        |  |           |        |       |  |   |        |       |  |   |         |      
|                                     
|                                     
|                                     
|                                     
|Net sales                             |         | $       | 55,010 |        |  | $     | 74,419 |        |  | $         | 73,417 |       |  | $ | 71,812 |       |  | $ | 274,658 |      
|                                     
|                                     
|                                     
|                                     
|Gross profit                          |         |         | 27,322 |        |  |       | 34,248 |        |  |           | 35,240 |       |  |   | 32,810 |       |  |   | 129,620 |      
|                                     
|                                     
|                                     
|                                     
|Income before income taxes            |         |         | 8,536  |        |  |       | 12,335 |        |  |           | 11,926 |       |  |   | 9,558  |       |  |   | 42,355  |      
|                                     
|                                     
|                                     
|                                     
|Net income                            |         |         | 5,474  |        |  |       | 7,908  |        |  |           | 7,635  |       |  |   | 6,173  |       |  |   | 27,190  |      
|                                     
|                                     
|                                     
|                                     
|Earnings per share:                   |         |         |        |        |  |       |        |        |  |           |        |       |  |   |        |       |  |   |         |      
|                                     
|                                     
|                                     
|                                     
|                                      | Basic   |         | $      | 0.31   |  |       | $      | 0.45   |  |           | $      | 0.43  |  |   | $      | 0.35  |  |   | $       | 1.54  | 
|                                     
|                                     
|                                     
|                                     
|                                      | Diluted |         | $      | 0.31   |  |       | $      | 0.45   |  |           | $      | 0.43  |  |   | $      | 0.35  |  |   | $       | 1.54  | 
|                                     
|                                     
|                                     
|                                     
|Market price:                         |         |         |        |        |  |       |        |        |  |           |        |       |  |   |        |       |  |   |         |      
|                                     
|                                     
|                                     
|                                     
|                                      | High    |         | $      | 24.00  |  |       | $      | 19.69  |  |           | $      | 18.19 |  |   | $      | 17.00 |  |   | $       | 24.00 | 
|                                     
|                                     
|                                     
|                                     
|                                      | Low     |         | $      | 12.38  |  |       | $      | 12.63  |  |           | $      | 16.31 |  |   | $      | 14.75 |  |   | $       | 12.38 | 
|                                     
|                                     
|                                     
|                                     
|2000                                  |         |         |        |        |  |       |        |        |  |           |        |       |  |   |        |       |  |   |         |      
|                                     
|                                     
|                                     
|                                     
|Net sales                             |         | $       | 74,825 |        |  | $     | 82,178 |        |  | $         | 82,064 |       |  | $ | 80,657 |       |  | $ | 319,724 |      
|                                     
|                                     
|                                     
|                                     
|Gross profit                          |         |         | 34,562 |        |  |       | 39,697 |        |  |           | 36,567 |       |  |   | 36,260 |       |  |   | 147,086 |      
|                                     
|                                     
|                                     
|                                     
|Income before income taxes            |         |         | 11,071 |        |  |       | 14,763 |        |  |           | 13,211 |       |  |   | 9,768  |       |  |   | 48,813  |      
|                                     
|                                     
|                                     
|                                     
|Net income                            |         |         | 7,065  |        |  |       | 9,372  |        |  |           | 8,466  |       |  |   | 5,977  |       |  |   | 30,880  |      
|                                     
|                                     
|                                     
|                                     
|Earnings per share:                   |         |         |        |        |  |       |        |        |  |           |        |       |  |   |        |       |  |   |         |      
|                                     
|                                     
|                                     
|                                     
|                                      | Basic   |         | $      | 0.40   |  |       | $      | 0.53   |  |           | $      | 0.48  |  |   | $      | 0.34  |  |   | $       | 1.75  | 
|                                     
|                                     
|                                     
|                                     
|                                      | Diluted |         | $      | 0.40   |  |       | $      | 0.53   |  |           | $      | 0.47  |  |   | $      | 0.33  |  |   | $       | 1.73  | 
|                                     
|                                     
|                                     
|                                     
|Market price:                         |         |         |        |        |  |       |        |        |  |           |        |       |  |   |        |       |  |   |         |      
|                                     
|                                     
|                                     
|                                     
|                                      | High    |         | $      | 17.44  |  |       | $      | 22.13  |  |           | $      | 26.63 |  |   | $      | 27.75 |  |   | $       | 27.75 | 
|                                     
|                                     
|                                     
|                                     
|                                      | Low     |         | $      | 14.50  |  |       | $      | 15.38  |  |           | $      | 19.31 |  |   | $      | 21.81 |  |   | $       | 14.50 | 

The Company completed its acquisition of Whiting+Davis effective
June 30, 2000 and its acquisition of Perfect Fit and
affiliates on April 1, 1999. During the fourth quarter of
2000 the Company incurred costs in connection with its
evaluation of various strategic alternatives totaling $1.1
million. For comparative purposes, net income and earnings per
share excluding non-recurring items related to these
acquisitions and excluding the non-recurring costs incurred
during the fourth quarter of 2000, would have been as follows:

|                                      |  |         |       |        |  |       |       |        |  |           |       |  |  |   |       |  |  |   |        | 
|------------------------------------- |  | ------- | ----- | ------ |  | ----- | ----- | ------ |  | --------- | ----- |  |  | - | ----- |  |  | - | ------ | 
|                                      |  |         |       |       
|                                      |  | Quarter |       |       
|                                      |  |         |       |       
|                                      |  | First   |       | Second |  | Third |       | Fourth |  | Full Year
|(in thousands, except per share data) |  |         |       |        |  |       |       |        |  |          
|1999                                  |  |         |       |        |  |       |       |        |  |           |       |  |  |   |       |  |  |   |        | 
|                                     
|                                     
|                                     
|                                     
|Net income                            |  | $       | 5,474 |        |  | $     | 8,262 |        |  | $         | 7,635 |  |  | $ | 6,173 |  |  | $ | 27,544 | 
|                                     
|                                     
|                                     
|                                     
|Basic earnings per share              |  | $       | 0.31  |        |  | $     | 0.47  |        |  | $         | 0.43  |  |  | $ | 0.35  |  |  | $ | 1.56   | 
|                                     
|                                     
|                                     
|                                     
|Diluted earnings per share            |  | $       | 0.31  |        |  | $     | 0.47  |        |  | $         | 0.43  |  |  | $ | 0.35  |  |  | $ | 1.56   | 
|                                     
|                                     
|                                     
|                                     
|2000                                  |  |         |       |        |  |       |       |        |  |           |       |  |  |   |       |  |  |   |        | 
|                                     
|                                     
|                                     
|                                     
|Net income                            |  | $       | 7,065 |        |  | $     | 9,372 |        |  | $         | 8,592 |  |  | $ | 7,103 |  |  | $ | 32,132 | 
|                                     
|                                     
|                                     
|                                     
|Basic earnings per share              |  | $       | 0.40  |        |  | $     | 0.53  |        |  | $         | 0.49  |  |  | $ | 0.40  |  |  | $ | 1.82   | 
|                                     
|                                     
|                                     
|                                     
|Diluted earnings per share            |  | $       | 0.40  |        |  | $     | 0.53  |        |  | $         | 0.48  |  |  | $ | 0.39  |  |  | $ | 1.80   | 

39



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##### Table of Contents



BACOU USA, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
(Continued)








|        |                                                                                      
|------- | -------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements with Accountants on
	Accounting and Financial Disclosure

None.




PART III




Item 10.  Directors and Executive Officers
of the Registrant

The following are the current members of the Board of Directors
of Bacou USA, Inc.

|                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |          |      | 
|--------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------- | ---- | 
|                      |  | Principal Occupation During                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | Director
|Name and Age          |  | The Past Five Years                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  | Since   
|                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |         
|Philippe Bacou*, 43   |  | Co-Chairman of the Board since May, 1999, Chairman from June
	1996 to May, 1999; Chairman, President and Chief Executive
	Officer of Bacou, S.A. since July  1996; previously
	Executive Vice President of Bacou, S.A. since 1993; Director of
	Bacou, S.A. since 1985.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  |          | 7/94 | 
|                     
|                     
|                     
|                     
|Walter Stepan, 62     |  | Co-Chairman since May, 1999, President and Chief Executive
	Officer from July, 1994 to December, 1999; Chairman of the
	following subsidiaries: Bacou USA Safety, Inc. (Bacou
	Safety); Titmus Optical, Inc. (Titmus);
	Perfect Fit Glove Co., LLC (PFG). Formerly, Chairman
	of Uvex Safety Manufacturing, Inc. (USM) and SCHAS
	Industries, LLC (SCHAS). Also a director of Bacou,
	S.A., Bacou Industrial & Trading (Shanghai) Co., Ltd. (an
	affiliate of Bacou, S.A.), Uvex Safety Australia Pty Ltd.
	(UXA) and Uvex (UK) Limited (Uvex
	UK). UXA and Uvex UK are corporate entities in which the
	majority shareholder of each is Uvex Arbeitsschutz GmbH
	(Uvex Germany) and in which Bacou USA and Bacou
	International B.V., an affiliate of Bacou S.A., are equal
	minority shareholders. |  |          | 7/94 | 
|                     
|                     
|                     
|                     
|Philip B. Barr, 49    |  | President and Chief Executive Officer since January, 2000;
	previously Chief Operating Officer from February, 1999 to
	December, 1999; Executive Vice President from October 1996
	to December, 1999; Vice President from August 1995 to
	October 1996; Chief Financial Officer and Secretary from
	August 1995 to May, 1999; Vice Chairman of Bacou Safety and
	Titmus since December 1997; Vice Chairman of PFG (including
	its predecessor Perfect Fit Glove Co., Inc.) since April 1999;
	Chairman of USM and SCHAS since January, 2000; Secretary and
	Treasurer of Bacou Safety from December 1997 to May, 1999;
	Vice Chairman of USM from December 1997 to December, 1999;
	Vice Chairman of SCHAS Industries, Inc. from April, 1999 to
	December, 1999.                                                     |  |          | 8/95 | 
|                     
|                     
|                     
|                     
|Christophe Bacou*, 37 |  | Vice President of Bacou, S.A.; previously Marketing Manager of
	two subsidiaries of Bacou, S.A.; employed by affiliates of
	Bacou, S.A. since 1990. Also, Director of Bacou, S.A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |          | 1/96 | 
|                     
|                     
|                     
|                     
|Karl F. Ericson, 67   |  | Independent business consultant since 1990. Partner with Peat
	Marwick Mitchell & Co., predecessor to KPMG LLP, from 1970
	to 1990. Also, Director of Bank Rhode Island.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |          | 7/96 | 

40



---



##### Table of Contents



|                         |  |                                                                                                                                                                                                                                                                                                                                                                    |  |          |      | 
|------------------------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | -------- | ---- | 
|                         |  | Principal Occupation During                                                                                                                                                                                                                                                                                                                                        |  | Director
|Name and Age             |  | The Past Five Years                                                                                                                                                                                                                                                                                                                                                |  | Since   
|                         |  |                                                                                                                                                                                                                                                                                                                                                                    |  |         
|Howard S. Leight, 60     |  | Founder of Howard S. Leight & Associates, Inc. (d/b/a Howard
	Leight Industries); President and sole stockholder of Howard
	Leight Industries from 1984 until February 1998. Consultant
	to Bacou Safety since February 1998. Director of Howard
	Leight Enterprises, Inc. n/k/a Continental Polymers, Inc., since
	1997. Also, Director of Bacou, S.A. since 1998 |  |          | 2/98 | 
|                        
|                        
|                        
|                        
|Alfred J. Verrecchia, 58 |  | President and Chief Operating Officer, Hasbro, Inc. from 2000 to
	present; Executive Vice President, Global Operations from 1996
	to 2000; Chief Financial Officer from 1999 to 2001; previously
	Chief Operating Officer, Domestic Toy Operations from 1990 to
	1996; Director, Hasbro, Inc.; Director, Old Stone Corporation.                                    |  |          | 2/99 | 




|  |                                                  
|- | -------------------------------------------------
|* | Philippe Bacou and Christophe Bacou are brothers.

41



---



##### Table of Contents



SECTION 16(a)  BENEFICIAL OWNERSHIP REPORTING
COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934
requires Bacous officers and directors, and persons who
own more than 10% of a registered class of our equity securities
(Insiders), to file reports of ownership and changes
in ownership with the SEC. Insiders are required by SEC
regulation to furnish us with copies of all Section 16(a)
forms they file. Based solely on review of the copies of such
forms furnished to us, we believe that during 2000 all of our
Insiders met their Section 16(a) filing requirements.




Item 11.  Executive Compensation

Executive Compensation

The following table summarizes certain information with respect
to compensation for services rendered to us during the years
ended December 31, 2000, 1999 and 1998 by our chief
executive officer and the four other most highly compensated
executive officers in 2000 whose salary and bonus exceeded
$100,000.

Summary Compensation Table




|                            |                                                                                                                                                                                                 |          |      |                     |  |              |         |              |  |              |         |              |  |   |        |        |     |  |   |        |  |   |        |         |    
|--------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ---- | ------------------- |  | ------------ | ------- | ------------ |  | ------------ | ------- | ------------ |  | - | ------ | ------ | --- |  | - | ------ |  | - | ------ | ------- | ---
|                            |                                                                                                                                                                                                 |          |      |                     |  |              |         |              |  | Long-term    |         |             
|                            |                                                                                                                                                                                                 |          |      |                     |  |              |         |              |  | Compensation |         |             
|                            |                                                                                                                                                                                                 |          |      |                     |  |              |         |              |  | Awards       |         |             
|                            |                                                                                                                                                                                                 |          |      |                     |  | Securities   |         |             
|                            |                                                                                                                                                                                                 |          |      | Annual Compensation |  | Underlying   |         |             
|                            |                                                                                                                                                                                                 |          |      |                     |  | Options/     |         |             
|                            |                                                                                                                                                                                                 | Calendar |      |                     |  | Other Annual |         | SARs         |  | All Other   
|Name and Principal Position |                                                                                                                                                                                                 | Year     |      | Salary              |  | Bonus        |         | Compensation |  | (Shares)     |         | Compensation
|                            |                                                                                                                                                                                                 |          |      |                     |  |              |         |              |  |              |         |             
|Walter Stepan               |                                                                                                                                                                                                 |          | 2000 |                     |  | $            | 120,000 |              |  | $            | 880,000 |              |  | $ | 92,000 | (1)    |     |  |  |        |  | $ | 38,450 | (2)    
|                            | President and Chief Executive                                                                                                                                                                   |          |      | 1999                |  |              |         | 500,000      |  |              |         | 2,400,000    |  |   |        | 92,000 | (1) |  |   | 70,000 |  |   |        | 151,058 | (2)
|                            | Officer through December, 1999;                                                                                                                                                                 |          |      | 1998                |  |              |         | 500,000      |  |              |         | 2,100,000    |  |   |        | 62,000 | (1) |  |   | 30,000 |  |   |        | 16,002  | (2)
|                            | Currently Co-Chairman; also Chairman of Bacou Safety, Titmus and
	PFG                                                                                                                           |          |      |                     |  |              |         |              |  |              |         |              |  |   |        |        |     |  |   |        |  |   |        |         |    
|                           
|                           
|                           
|                           
|                           
|Philip B. Barr              |                                                                                                                                                                                                 |          | 2000 |                     |  |              | 450,000 |              |  |              | 450,000 |              |  |   |        | (3)    |     |  |  |        |  |   | 2,654  | (4)    
|                            | President and Chief Executive                                                                                                                                                                   |          |      | 1999                |  |              |         | 300,000      |  |              |         | 350,000      |  |   |        |        | (3) |  |   |       |  |   |        | 2,048   | (4)
|                            | Officer since January, 2000; Vice                                                                                                                                                               |          |      | 1998                |  |              |         | 250,000      |  |              |         | 300,000      |  |   |        |        | (3) |  |   | 35,000 |  |   |        | 2,906   | (4)
|                            | Chairman of Bacou Safety, Vice Chairman and CEO of Titmus and
	PFG; Chairman of USM and Chairman and CEO of SCHAS; Executive
	Vice President and Chief Operating Officer through December, 1999 |          |      |                     |  |              |         |              |  |              |         |              |  |   |        |        |     |  |   |        |  |   |        |         |    
|                           
|                           
|                           
|                           
|                           
|Alan H. Bennett             |                                                                                                                                                                                                 |          | 2000 |                     |  |              | 325,000 |              |  |              | 250,000 |              |  |   |        | (3)    |     |  |   |        |  |   | 2,221  |        
|                            | Chief Operating Officer since                                                                                                                                                                   |          |      | 1999                |  |              |         | 225,961      |  |              |         | 130,384      |  |   |        | 76,119 | (5) |  |   | 15,000 |  |   |        | 87,543  | (6)
|                            | January, 2000; President and CEO                                                                                                                                                                |          |      | 1998                |  |              |         |             |  |              |         |             |  |   |        |       |     |  |   |       |  |   |        |        |    
|                            | of Bacou Safety and USM; Chief Operating Officer of PFG, SCHAS
	and Titmus                                                                                                                      |          |      |                     |  |              |         |              |  |              |         |              |  |   |        |        |     |  |   |        |  |   |        |         |    
|                           
|                           
|                           
|                           
|                           
|Adrien W. Hebert            |                                                                                                                                                                                                 |          | 2000 |                     |  |              | 225,000 |              |  |              | 160,000 |              |  |   |        | (3)    |     |  |  |        |  |   | 5,246  | (4)    
|                            | Vice President-Finance and Chief                                                                                                                                                                |          |      | 1999                |  |              |         | 150,000      |  |              |         | 110,000      |  |   |        |        | (3) |  |   |       |  |   |        | 5,000   | (4)
|                            | Financial Officer since May 1999                                                                                                                                                                |          |      | 1998                |  |              |         | 125,000      |  |              |         | 70,000       |  |   |        |        | (3) |  |   |       |  |   |        | 4,579   | (4)
|                           
|                           
|                           
|                           
|                           
|John F. Burt, Jr            |                                                                                                                                                                                                 |          | 2000 |                     |  |              | 245,000 |              |  |              | 62,720  |              |  |   |        | (3)    |     |  |  |        |  |   | 5,018  | (4)    
|                            | President of Biosystems division of                                                                                                                                                             |          |      | 1999                |  |              |         | 240,000      |  |              |         | 24,000       |  |   |        |        | (3) |  |   |       |  |   |        | 5,000   | (4)
|                            | Bacou Safety since March 31,                                                                                                                                                                    |          |      | 1998                |  |              |         | 230,000      |  |              |         | 62,100       |  |   |        |        | (3) |  |   |       |  |   |        | 4,899   | (4)
|                            | 1998; President of Biosystems, Inc., a subsidiary of the
	Corporation from September 30, 1997 through March 31,
	1998                                                                           |          |      |                     |  |              |         |              |  |              |         |              |  |   |        |        |     |  |   |        |  |   |        |         |    




42



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##### Table of Contents






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Represents reimbursement payable to Mr. Stepan by Bacou for
	U.S. Social Security taxes and the applicable personal income
	tax effects of such reimbursement. Certain other perquisites
	payable to Mr. Stepan did not exceed the threshold
	referenced in footnote (3), below.                                                                                                                                                                                                                           
|   
|(2) | Represents (i) the taxable benefit to Mr. Stepan of
	split-dollar life insurance premiums paid by Bacou on his behalf
	($33,200 in 2000, $1,707 in 1999 and $1,616 in 1998),
	(ii) term life insurance premiums paid by Bacou on behalf
	of Mr.  Stepan ($9,736 in 1999 and 1998),
	(iii) contributions by Bacou on behalf of Mr. Stepan
	under our 401(k) Plan Trust ($5,250 in 2000; $5,000 in 1999; and
	$5,000 in 1998); and (iv) payment in 1999 of $134,615 in
	accrued but unused vacation benefits.
|   
|(3) | Perquisites and other personal benefits paid to the Named
	Executive Officer were less than $50,000, or 10% of aggregate
	salary and bonus, and accordingly are omitted from the table as
	permitted by the rules of the Commission.                                                                                                                                                                                                                                                                       
|   
|(4) | Represents amounts paid by Bacou under our 401(k) Plan Trust and
	predecessor plans.                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|(5) | Represents payment on behalf of Mr. Bennett by Bacou for
	reimbursement of taxes attributable to reimbursement of
	relocation expenses.                                                                                                                                                                                                                                                                                                                                                                    
|   
|(6) | Represents (i) payment on behalf of Mr. Bennett by
	Bacou for reimbursement of relocation expenses and
	(ii) contributions on behalf of Mr. Bennett under our
	401(k) Plan Trust in the amount of $2,019.                                                                                                                                                                                                                                                                                                  

The Option/ SAR Grants in Last Fiscal Year table
typically sets forth certain information relating to option
grants pursuant to the Incentive Plan during the year just
ended. Since no options were granted to Mr. Stepan, Mr.
Barr, Mr. Bennett, Mr. Hebert or Mr. Burt in
2000, this table has been omitted.

The following table sets forth certain information with respect
to unexercised options to purchase our Common Stock granted
under the Incentive Plan to the individuals named in the Summary
Compensation Table above (other than Mr. Burt, who has no
options). These individuals exercised no options in 2000.

Fiscal Year-End Option/ SAR Values




|                 |  |                          |         |                           |  |             |       |               |  |   |           |  |  |   |        | 
|---------------- |  | ------------------------ | ------- | ------------------------- |  | ----------- | ----- | ------------- |  | - | --------- |  |  | - | ------ | 
|                 |  |                          |         |                           |  |            
|                 |  | Number of                |         |                          
|                 |  | Securities Underlying    |         | Value of Unexercised     
|                 |  | Unexercised Options/SARs |         | In-the-Money Options/SARs
|                 |  | at Fiscal Year-End       |         | at Fiscal Year-End(1)    
|                 |  |                          |         |                          
|Name             |  | Exercisable              |         | Unexercisable             |  | Exercisable |       | Unexercisable
|                 |  |                          |         |                           |  |             |       |              
|Walter Stepan    |  |                          | 100,000 |                           |  |             |      |               |  | $ | 932,500   |  |  |   |       | 
|                
|                
|                
|                
|Philip B. Barr   |  |                          | 100,000 |                           |  |             |      |               |  | $ | 1,017,500 |  |  |   |       | 
|                
|                
|                
|                
|Alan H. Bennett  |  |                          | 7,500   |                           |  |             | 7,500 |               |  | $ | 16,875    |  |  | $ | 16,875 | 
|                
|                
|                
|                
|Adrien W. Hebert |  |                          | 16,000  |                           |  |             | 4,000 |               |  | $ | 176,000   |  |  | $ | 44,000 | 







|    |                                                                                                                                                                     
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Based on a per share price of $26.00, the closing price of our
	Common Stock on The New York Stock Exchange on December 29,
	2000, the last trading day of the year.

Director Compensation

Directors who are also employees of Bacou receive no
compensation for service on the Board of Directors. The
non-employee directors receive cash compensation for service on
the Board of Directors in an annual amount of $15,000, payable
quarterly. As Co-Chairman of the Board, Mr. Philippe Bacou
receives $60,000 annually. In addition, each non-employee
director receives $1,000 per day for attendance at any meeting
of the Board of Directors or any of its Committees or $500 per
day for attendance by conference call.

Since August 1, 1996, we have granted current non-employee
directors 164,600 options in the aggregate at exercise prices
equal to the fair market value of the Common Stock on the date
of grant, pursuant to the 1996 Non-Employee Director Stock
Option Plan (Director Plan). Effective
February 27, 1998, we granted 50,000 options to
Mr. Leight at an exercise price equal to $17.00 per share,
pursuant to the 1998 Howard S. Leight Stock Option Plan
(Leight Plan). See Certain Transactions.
As of May 15, 2000, each Director

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##### Table of Contents





Employment Contracts

Mr. Stepan

On December 1, 1999, we entered into an Amended and
Restated Employment Agreement with Mr. Stepan, effective
January 1, 2000 for a period of three years with respect to
Mr. Stepans service as Co-Chairman of Bacou, with
annual renewals thereafter unless either party provides six
months notice prior to the end of a term. In this position,
Mr. Stepan receives a salary of $120,000 per year (subject
to annual reviews) and must devote at least 25% of his normal
business commitment to Bacou. He is eligible to receive a
discretionary amount of incentive compensation, subject to the
approval of the Compensation Committee, depending on the success
and progress that Bacou achieves during each year, based on the
time he devotes to his duties and reflecting his former position
as President and CEO. Mr. Stepan continues to receive all
employment benefits for which he was previously eligible. In the
event of any direct or indirect change of control of Bacou,
Mr. Stepan will receive a guaranteed minimum payment equal
to the sum of the amounts that would be payable to him during
the remaining term of this agreement, including total base
salary, bonus equal to 25% of his 1999 bonus, a number of stock
options equal to those granted to the President and CEO, plus
the present value of all other benefits under the agreement from
such date until the end of the then-current term of the
agreement. The above agreement prohibits Mr. Stepan from
competing with Bacou and from disclosing confidential
information regarding the company during the term of such
agreement and thereafter for periods of one year and three
years, respectively.

Mr. Barr

Effective January 1, 2000, Bacou and Mr. Barr entered
into an Employment Agreement regarding Mr. Barrs
service as President and Chief Executive Officer of Bacou for a
three-year term, with two-year renewal terms thereafter unless
either party provides six-months notice prior to the end
of any such term. We paid Mr. Barr a base salary of
$450,000 for the first year of the initial term, subject to
annual reviews. We determined his bonus payments and stock
options pursuant to the Bonus and Option Plan for senior
executives, according to which Mr. Barr receives awards
determined by the compound annual growth rate of Bacous
net income and earnings before interest, taxes, depreciation and
amortization (EBITDA). For 2000, Mr. Barr
received a bonus of $450,000. The agreement also provides that
in the event of any change of control of Bacou, either directly
or indirectly, Mr. Barr shall receive a guaranteed minimum
payment equal to the sum of the amounts that would be payable to
him during the remaining term of this agreement, including total
base salary, bonus and stock options plus the present value of
all other benefits under the agreement from such date until the
end of the then-current term of the agreement (Change of
Control Payment). The above agreement prohibits
Mr. Barr from competing with Bacou and from disclosing any
confidential information regarding our business during the term
of the agreement and thereafter for periods of one year and
three years, respectively.

Mr. Bennett

Effective January 1, 2000, we entered into a three-year
Employment Agreement with Mr. Bennett with two-year renewal
terms thereafter unless either party provides six-months
notice prior to the end of a term. We paid him a base salary of
$325,000 for the first year of the initial term, with bonus and
stock options subject to the Bonus and Option Plan for senior
executives. He received a bonus of $250,000 for his service in
2000. The agreement provides that in the event of a change of
control of Bacou, either directly or indirectly,
Mr. Bennett shall receive a Change of Control Payment.
Under this agreement, Mr. Bennett is restricted from
competing with Bacou and is prohibited from disclosing any
confidential information about our business during the term of
the agreement and thereafter for periods of one year and three
years, respectively.

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##### Table of Contents



Mr. Hebert

Effective January 1, 2000, Bacou and Mr. Hebert
entered into an employment agreement for a term of three years,
with one-year annual renewals thereafter subject to six months
notice by either party. We paid Mr. Hebert a base salary of
$225,000 for the first year of the agreement, subject to annual
reviews. He is eligible for a bonus and stock options pursuant
to the Bonus and Option Plan for senior executives. For 2000, he
received a bonus of $160,000. The agreement provides that in the
event of a change of control of Bacou, directly or indirectly,
Mr. Hebert will receive a Change of Control Payment. The
agreement prohibits Mr. Hebert from competing with Bacou
and from disclosing any confidential information about our
business during the term of the agreement and thereafter, for
periods of one year and three years, respectively.

Mr. Burt

Effective on October 1, 1997, Biosystems, Inc., a
predecessor to Bacou Safety, entered into an Employment
Agreement with Mr. Burt. According to this agreement, as
amended by a First Amendment thereto dated as of April 1,
2001, Mr. Burt served as President of Biosystems (now the
Biosystems division of Bacou Safety) for an initial term through
April 30, 2001. Beginning April 30, 2001,
Mr. Burt will serve Biosystems in the position of Founder
through December 31, 2002 and for one year renewal periods
thereafter unless written notice of termination is provided by
either party at least six months prior to the end of a term. The
agreement provides for a base salary of $245,000 for 2000 and
$250,000 for 2001. In March, 2001, Mr. Burt received a
bonus of $62,720 for his services in 2000. Mr. Burt is
eligible to participate in employee benefit plans but has
received no awards of stock options under the Incentive Plan. He
is subject to certain non-competition and confidentiality
covenants regarding the companys business during the term
of the agreement and thereafter. Also, see Contingent
Payments and Other Provisions of the Biosystems Agreement
and Registration Rights.

Compensation Committee Interlocks and Insider
Participation

Mr. Stepan, Chairman of the Boards Compensation
Committee and Co-Chairman of Bacou, serves on the Board of
Directors of Bacou, S.A., and Mr. P. Bacou is the Chairman,
President and Chief Executive Officer of Bacou, S.A. and is a
member of our Boards Compensation Committee.

COMPENSATION COMMITTEE REPORT

During 2000, the membership of the Compensation Committee of the
Board of Directors consisted of Messrs. Philippe Bacou,
Karl F. Ericson, Walter Stepan (Chair) and Alfred J.
Verrecchia. Mr. P. Bacou, Mr. Verrecchia and
Mr. Ericson are not Bacou employees. Mr. Stepan
currently serves as our Co-Chairman and is Chairman of Bacou
Safety, PFG and Titmus. The role of the Compensation Committee
is advisory and administrative in nature, with responsibility
for matters such as making recommendations to the Board of
Directors concerning certain compensation matters and
administering compensation plans adopted by the Board of
Directors, including the Incentive Plan, the Bonus and Option
Plan (for senior executives) and the Bacou Bonus Plan for
Executives of Subsidiaries and Divisions for 2000 (Bonus
Plan). The Compensation Committee has a Sub-Committee,
currently comprised of Mr. Ericson and Mr. Verrecchia,
that is charged with the responsibility of reviewing, approving
and recommending to the Compensation Committee all compensation
arrangements for covered employees (as defined by
Section 162(m) of the Internal Revenue Code) who are likely
to have compensation in excess of $1 million during any fiscal
year. For 2000, no covered employee received compensation in
excess of that amount.

Compensation Policies

The Bacou executive compensation program consists of three main
components: (1) base salary, (2) cash bonus and
(3) stock options. Base salaries are designed to attract
and retain well-qualified executives who are likely to manage
our company and its operating subsidiaries in a manner that will
produce successful operating strategies and results. We use cash
bonuses to provide short-term incentives that are determined in

45



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##### Table of Contents





Direct Relationship of Compensation to Corporate Financial
Performance

For 2000, we paid Mr. Barr, Mr. Bennett and
Mr. Hebert bonuses that were in direct relation to
corporate financial performance, as measured by operating
income, pursuant to their employment agreements. This resulted
in our paying all of Mr. Barrs,
Mr. Bennetts and Mr. Heberts bonuses in
direct relation to the level of Bacous operating profit on
a consolidated basis.

For the executive officers of our operating subsidiaries and
divisions, we designed executive compensation in relation to
corporate performance through the Bonus Plan, which provides
increased bonus levels as subsidiary and division operating
margins, net sales and operating profits increase. On this
basis, the portion of bonuses that were in direct relation to
corporate financial performance ranged from approximately 20% to
50% of base salary for our executive officers at operating
subsidiaries and divisions.

CEO Compensation

Mr. Barr served as Chief Executive Officer of Bacou during
2000. The terms of his Employment Agreement effective
January 1, 2000, determined his salary and benefits for
2000. Mr. Barrs cash bonus represents 50% of his 2000
compensation. He was entitled to a cash bonus pursuant to an
incentive formula that directly connected Bacous financial
performance, as measured by growth of consolidated net earnings
and EBITDA, to the amount of his bonus. Based on our financial
performance for 2000, the Compensation Committee awarded
Mr. Barr a cash bonus of $450,000.

IRS Matters

Section 162(m) of the Internal Revenue Code disallows
deductions by publicly held companies for employee remuneration
in excess of $1 million that is not performance-based. For 2000,
no covered employee received more than $1 million in
remuneration.



| |                       
| | ----------------------
| | COMPENSATION COMMITTEE
|
| | Walter Stepan (Chair) 
| | Philippe Bacou        
| | Karl F. Ericson       
| | Alfred J. Verrecchia  

46



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##### Table of Contents



CORPORATE PERFORMANCE

The line graph below compares the cumulative total stockholder
return for the years ended December 31, 1996, 1997, 1998,
1999 and 2000 of our Common Stock against the cumulative total
return of the Russell 2000 Index. We compare our return to the
Russell 2000 Index because we believe that it is the most
appropriate index for comparative results. The graph also
compares such return for the years 1996, 1997, 1998, 1999 and
2000 against the cumulative total return of a peer group of
companies in the safety and security products market consisting
of Checkpoint Systems; Cintas Corporation; Indentix, Inc.; Mine
Safety Appliances Company; Pittston Brinks Group; Scott
Technologies (formerly known as Figgie International);
Sensormatic Electronics; and Symbol Technologies (Peer
Group). Prior to this year, there were five other
companies that were a part of this group: Borg-Warner Security
Corp., Pittway Corporation, Safeskin Corporation, Thermedics,
Inc. and Vivid Technologies. Through various corporate
transactions, these companies no longer serve as a basis for
comparison with us. The graph and table assume that $100 was
invested on March 27, 1996 in each of Bacou Common Stock,
the Russell 2000 Index and the Peer Group, and that all
dividends were reinvested.

(Performance Graph)

|              |  |         |        |          |  |          |        |          |  |          |        |          |  |  |        |  |  |  |        |  |  |  |        | 
|------------- |  | ------- | ------ | -------- |  | -------- | ------ | -------- |  | -------- | ------ | -------- |  |  | ------ |  |  |  | ------ |  |  |  | ------ | 
|             
|             
|              |  | 3/27/96 |        | 12/31/96 |  | 12/31/97 |        | 12/31/98 |  | 12/31/99 |        | 12/31/00
|             
|             
|Bacou USA     |  |         | 100.00 |          |  |          | 110.83 |          |  |          | 116.66 |          |  |  | 143.33 |  |  |  | 100.42 |  |  |  | 173.33 | 
|S&P 500 Index |  |         | 100.00 |          |  |          | 117.82 |          |  |          | 157.13 |          |  |  | 202.03 |  |  |  | 244.55 |  |  |  | 222.28 | 
|Russell 2000  |  |         | 100.00 |          |  |          | 113.16 |          |  |          | 138.46 |          |  |  | 134.93 |  |  |  | 163.62 |  |  |  | 158.86 | 
|Peer Group    |  |         | 100.00 |          |  |          | 107.62 |          |  |          | 130.17 |          |  |  | 188.83 |  |  |  | 194.40 |  |  |  | 222.24 | 

47



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##### Table of Contents






Item 12.  Security Ownership of Certain
Beneficial Owners and Management

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

The following table sets forth, as of April 12, 2001
(unless otherwise noted), certain information concerning the
ownership of shares of Common Stock by (i) each person or
group that we know owns beneficially more than five percent of
the issued and outstanding shares of Common Stock,
(ii) each director, (iii) each named executive officer
described in Executive Compensation above, and
(iv) all directors and executive officers as a group.
Except as otherwise indicated, each person named has sole
investment and voting power with respect to his or its shares of
Common Stock shown.




|                                                               |                                                              |                  |            |                  |  |  |       |   | 
|-------------------------------------------------------------- | ------------------------------------------------------------ | ---------------- | ---------- | ---------------- |  |  | ----- | - | 
|Name                                                           |                                                              | Number of Shares |            | Percent of Class
|                                                               |                                                              |                  |            |                 
|Bacou, S.A.                                                    |                                                              |                  | 12,612,600 | (1)              |  |  | 71.37 | %
|                                                               | 168 Avenue des Auréats
	BP 1205
	26012 Valence Cedex, France |                  |            |                  |  |  |       |   | 
|                                                              
|                                                              
|                                                              
|                                                              
|Brinson Partners, Inc.                                         |                                                              |                  | 930,496    | (2)              |  |  | 5.26  | %
|                                                               | 209 South LaSalle Street
	Chicago, IL 60604-1295             |                  |            |                  |  |  |       |   | 
|                                                              
|                                                              
|                                                              
|                                                              
|UBS AG                                                         |                                                              |                  | 930,496    | (2)              |  |  | 5.26  | %
|                                                               | Bahnhofstrasse 45
	8021, Zurich, Switzerland                 |                  |            |                  |  |  |       |   | 
|                                                              
|                                                              
|                                                              
|                                                              
|Philippe Bacou                                                 |                                                              |                  | 12,696,400 | (1)(3)           |  |  | 71.49 | %
|                                                              
|                                                              
|                                                              
|                                                              
|Walter Stepan                                                  |                                                              |                  | 522,900    | (4)(5)           |  |  | 2.94  | %
|                                                              
|                                                              
|                                                              
|                                                              
|Christophe Bacou                                               |                                                              |                  | 30,400     | (3)              |  |  | *     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Philip B. Barr                                                 |                                                              |                  | 105,100    | (5)              |  |  | *     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Karl F. Ericson                                                |                                                              |                  | 36,400     | (3)              |  |  | *     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Howard S. Leight                                               |                                                              |                  | 75,000     | (3)(6)           |  |  | *     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Alfred J. Verrecchia                                           |                                                              |                  | 10,500     | (3)              |  |  | *     |  
|                                                              
|                                                              
|                                                              
|                                                              
|Alan H. Bennett                                                |                                                              |                  | 21,250     | (5)              |  |  | *     |  
|                                                              
|                                                              
|                                                              
|                                                              
|John F. Burt, Jr.                                              |                                                              |                  | 287,190    | (7)              |  |  | 1.62  | %
|                                                              
|                                                              
|                                                              
|                                                              
|Adrien W. Hebert                                               |                                                              |                  | 20,000     | (5)              |  |  | *     |  
|                                                              
|                                                              
|                                                              
|                                                              
|All directors and executive officers as a group (21 
	persons) |                                                              |                  | 13,950,640 | (3)(4)(5)(6)(7)  |  |  | 76.37 | %







|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Philippe Bacou is Chairman, President and Chief Executive
	Officer of Bacou, S.A. and has sole voting and dispositive power
	with respect to shares of Common Stock owned by Bacou, S.A.                                                                                                                                                                                                                                                                                                                                                                             
|   
|(2) | According to its Schedule 13G/ A filed with the Securities
	and Exchange Commission (Commission) on
	February 13, 2001, Brinson Partners, Inc. (BPI)
	had, as of December  31, 2000, sole voting power and shared
	dispositive power with respect to 930,496 shares of Common
	Stock. On the same Schedule 13G/ A, UBS AG, through its
	indirect beneficial subsidiary, BPI, had sole voting power and
	shared dispositive power with respect to the same 930,496 shares
	of Common Stock. Both BPI and UBS AG disclaim beneficial
	ownership of such securities.
|   
|(3) | Includes, as applicable, the following shares of Common Stock
	reserved for issuance upon exercise of stock options outstanding
	pursuant to our 1996 Non-Employee Director Stock Option Plan,
	all of which are vested: Mr. P. Bacou, 83,800 shares;
	Mr. C. Bacou, 30,400 shares; Mr. Ericson, 30,400
	shares; Mr. Leight, 10,000 shares; Mr.  Verrecchia,
	10,000 shares; (all directors as a group, 164,600 shares).                                                                                                                                             
|   
|(4) | Includes 55,440 shares of Common Stock owned of record by
	Mr. Stepans wife.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   
|(5) | Includes, as applicable, the following shares of Common Stock
	reserved for issuance upon exercise of stock options vested as
	of April 14, 2001 pursuant to the Corporations 1996
	Stock Incentive Plan: Mr. Stepan, 100,000 shares; Mr. 
	Barr, 100,000 shares; Mr. Bennett 11,250 shares; and
	Mr. Hebert,                                                                                                                                                                                                                                                       

48



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##### Table of Contents



|    |                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    | 20,000 shares; (all executive officers as a group (including
	Messrs. Stepan, Barr, Bennett and Hebert), 377,250 shares).                                                                                                                                                                                                                                                                        
|   
|   
|(6) | Includes 50,000 shares of Common Stock reserved for issuance
	upon exercise of stock options outstanding pursuant to our 1998
	Howard  S. Leight Stock Option Plan, all of which options
	are vested and which constitute all options reserved for
	issuance under this plan.                                                                                                                    
|   
|(7) | Represents unregistered shares held as part of consideration for
	exchange of Mr. Burts shares in Biosystems, Inc. in
	our acquisition of Biosystems. Mr. Burt has
	piggyback registration rights with respect to these
	shares. Includes 79,130 shares until recently held in escrow
	that were allocable to Mr. Burt pursuant to an escrow
	agreement as part of the Biosystems acquisition.
|   
|*   | Less than 1%.                                                                                                                                                                                                                                                                                                                                                                                    




Item 13.  Certain Relationships and Related
Transactions

Contingent Payments and Other Provisions of the Biosystems
Agreement




Pursuant to provisions of the Merger Agreement with Biosystems,
Inc., (Biosystems Agreement), Bacou is contingently
obligated to make certain earn-out payments if the operating
results of the Biosystems division exceed certain defined
thresholds in the year 2000 (Contingent Payments).
Contingent Payments, if any, would be payable to the five former
stockholders of Biosystems, Inc. (including
Mr. Burt)(Biosystems Stockholders) and are
payable in unregistered shares of common stock of Bacou, except
that the Biosystems Stockholders have the option to receive up
to an aggregate amount of $12.0 million of any Contingent
Payments in cash. Pursuant to the Biosystems Agreement, we have
submitted the year 2000 financial statements of Biosystems and
an accountants report thereon, along with other materials
pertaining to the calculation of the Contingent Payments, to the
Biosystems Stockholders for their review. The Biosystems
Stockholders have until June 12, 2001 to comment on the
materials submitted to them.




Registration Rights

Bacou, S.A. (Principal Stockholder) and
Mr. Burt each has certain contractual rights (each, a
Demand Registration Right) to cause Bacou to
register its shares of Common Stock under the Securities Act of
1933, as amended (Securities Act). In addition,
subject to certain limitations, if Bacou proposes to register
any of its securities under the Securities Act, either for its
own account or for the account of other security holders, each
of the Principal Stockholder, all selling shareholders of
Biosystems, Inc., and Mr. Stepan, his wife and two adult
children (together, Stepan Family), are entitled to
written notice of the registration and are entitled to, at
Bacous expense, include therein shares of Common Stock
held by such holder (Piggyback Right), provided,
among other conditions, that the underwriters of any offering
have the right to limit the number of such shares included in
the registration. If an underwriter does so limit the number of
shares included in a registration, shares will be eliminated
from the offering in the following order: (i) shares
proposed to be sold by selling shareholders of Biosystems, Inc.
pursuant to a Piggyback Right, (ii) shares proposed to be
sold by the Principal Stockholder or the Stepan Family pursuant
to a Piggyback Right, (iii) shares proposed to be sold by
any person pursuant to the exercise of a Demand Registration
Right, and finally (iv) shares proposed to be sold by Bacou
for its own account. Bacou generally is required to bear all the
fees, costs and expenses of any such registration other than
underwriting discounts and commissions. Bacou also is obligated
to indemnify each of the Principal Stockholder, the selling
shareholders of Biosystems, Inc., the Stepan Family and any
other party that exercises its registration rights against
certain liabilities, including liabilities under the Securities
Act.

Corporate Opportunities Agreement with Bacou Group

Bacou and the Principal Stockholder have entered into an
agreement that addresses potential conflicts of interest with
respect to future business opportunities. In general, the
agreement covers the following: the extent to which the
Principal Stockholder and its affiliates (together, Bacou
S.A. Group) may export their products to the United
States; the extent to which we may export its products to
France; the manner in which acquisition opportunities will be
allocated between the Bacou S.A. Group and us; the basis for
cooperation

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Except for products we supply as an Original Equipment
Manufacturer (OEM), we may not offer for sale in
France personal protective equipment of a type offered by the
Bacou S.A. Group to its customers in France unless we shall have
first offered to supply the products to the Bacou S.A. Group and
such offer shall have been declined. At any time after the Bacou
S.A. Group declines such an offer, it may change its decision,
prevent us from making future sales of such products in France
and undertake sales of such products on its own behalf. The
rights of the Bacou S.A. Group to reconsider such an offer would
be subject to any agreement we have entered into with third
parties subsequent to the Bacou S.A. Groups having
declined the initial offer.

Except for products supplied by the Bacou S.A. Group on an OEM
basis, the Bacou S.A. Group may not offer for sale in the United
States personal protective equipment of a type we offer to our
customers in the United States unless it shall have first
offered to supply the products to us and such offer shall have
been declined. At any time after we decline such an offer, we
may change our decision, prevent the Bacou S.A. Group from
making further sales of such products in the United States and
undertake sales of such products on our own behalf. Our rights
to reconsider such an offer would be subject to any agreement
entered into by the Bacou S.A. Group with third parties
subsequent to our having declined the initial offer.

The geographic restrictions applicable generally to our sales in
France and by the Bacou S.A. Group in the United States do not
apply to products sold by either party on an OEM basis, except
that either party may determine in its reasonable discretion
that such sales by the other party would materially and
adversely affect the marketability of its competing products, in
which case the other party would be required to curtail such
export sales of OEM products.

Opportunities for future acquisitions generally will be
allocated by geographic location, with our making acquisitions
of businesses in North, Central and South America and the Bacou
S.A. Group making acquisitions elsewhere in the world.
Recognizing our expertise in eyewear products, we have the right
of first refusal for any acquisitions of eyewear businesses
wherever located.

The agreement requires both parties and their affiliates to
regularly exchange information about activities relating to
product development, intellectual property rights, research and
development and manufacturing processes. In the event we select
a new product of the Bacou S.A. Group for sale within the United
States, we may utilize the intellectual property, products,
processes and know-how associated with the selected products
without payment of any royalty or consulting fee. We are subject
to the same requirement for our new products that are selected
by the Bacou S.A. Group for sale in France. Our obligations are
subject to the restrictions placed on Bacou Safety as
successor-in-interest to Uvex Safety, Inc. pursuant to
agreements with Uvex Germany. The obligations of both parties
are subject to any restrictions applicable under other third
party agreements, such as secrecy agreements, in force at
January 1, 1996.

Each party must supply its products to the other party generally
upon the most favorable terms and conditions applicable to
transactions with unrelated customers involving similar
quantities and purchase order conditions.

Principal Stockholder/ Perfect Fit Licensing Agreement

As of January 1, 2001, the Principal Stockholder entered
into a license and distribution agreement with our Perfect Fit
subsidiary whereby Perfect Fit has granted the Principal
Stockholder a non-exclusive license to sell certain of its
products approved by Perfect Fit using the brand name
Perfect Fitin Europe, Africa and Asia. The
agreement shall extend for a five-year term, with annual
renewals thereafter subject to a six-month notice by either
party. Perfect Fit receives a royalty payment of one-half of
1 percent of the sales price of each licensed product sold
by the Principal Stockholder using the Perfect Fitname.

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Inventory Purchases from and Sales to Principal
Stockholder

Bacou purchases certain inventory items from affiliates of the
Principal Stockholder. Total purchases were approximately
$3,843,000 in 2000, $1,049,000 in 1999 and $24,000 in 1998.
Bacou also sells certain inventory items to affiliates of the
Principal Stockholder, with sales totaling approximately
$4,239,000 in 2000, $1,925,000 in 1999 and $967,000 in 1998. The
Principal Stockholder has been the exclusive distributor of
Howard Leight products in France since 1993.

Joint Investments with Principal Stockholder

Effective August 1, 1999, Bacou and Bacou NL, an affiliate
of the Principal Stockholder, entered into certain agreements in
which we each became a 15% stockholder of Uvex Australia Pty
Ltd. and of Uvex (UK) Limited. These companies provide
channels of distribution for our products in each of their
respective regions. The remaining 70% ownership of both Uvex
Australia and Uvex UK is held by Uvex Germany. During 2000,
Bacou sold $2,413,000 in products to Uvex Australia and
$1,482,000 to Uvex UK, compared with $2,119,000 and $1,463,000
in 1999, respectively. Mr. Stepan serves as a Director of
each of these distribution companies as our representative.

Asset Purchase Agreement with Howard S. Leight &
Associates, Inc.

Pursuant to an Asset Purchase Agreement (as amended) with
Howard S. Leight & Associates, Inc. (d/b/a Howard
Leight Industries) (HLA), Bacou Safety consummated
the following transactions on February 27, 1998
(collectively, the Leight Transactions):
(i) acquired substantially all of the assets and assumed
substantially all of the liabilities of HLA (ii) acquired
all of the capital stock of Howard Leight de Mexico S.A. de C.V.
(except for one share of capital stock which was purchased by
Bacou in order to comply with Mexican statutory requirements)
from HLA and Howard S. Leight (Mr. Leight) and
(iii) acquired all of the capital stock of Howard Leight
(Europe) Limited from Mr. Leight and Mr. John Dean, Chief
Executive Officer of HLA at such time (and who served as the
President and Chief Operating Officer of Bacou Safety from
February 27, 1998 until May 19, 1998). Mr. Leight
was the founder and sole stockholder of HLA. Bacou Safety paid
cash consideration of $125.9 million in connection with the
closing of the Leight Transactions, $5.9 million of which
represented the refinancing of HLA indebtedness. In addition to
cash consideration paid at the closing, Bacou Safety has paid
$250,000 in additional consideration pursuant to the Asset
Purchase Agreement based upon sales results of the purchased
business in 2000.

Consulting Agreement with Howard S. Leight

In connection with the Leight Transactions, Mr. Leight
entered into a consulting agreement dated February 27, 1998
(Consulting Agreement) with Bacou Safety. The
Consulting Agreement requires Mr. Leight to provide advice
to Bacou Safety and to assist Bacou Safety with certain product
development and marketing efforts. As compensation for these
services, we paid Mr. Leight $183,333.37 in 2000
(representing 11 monthly payments), and we are required to
pay him at the rate of $200,000 per annumfor the
term of the Consulting Agreement. In addition, Bacou Safety is
required to make royalty payments to Mr. Leight for every
new hearing protection product which is patented by Bacou Safety
or for which a patent could be obtained but which Bacou Safety
determined not to file in order to protect its trade secret, and
which is either principally derived from ideas of
Mr. Leight or principally developed by Mr. Leight
subsequent to February 27, 1998. Royalty payments will be
paid at the rate of four percent (4%) of the net sales of any
qualifying product, provided sales of such product exceed
thresholds defined in the Consulting Agreement. We did not make
any royalty payments to Mr. Leight during 2000. The
Consulting Agreement continues for a period of five years from
the date of commencement, except, however, that Bacou
Safetys obligation to make royalty payments pursuant to
the Consulting Agreement does not terminate upon expiration of
this term. The Consulting Agreement also provides for
Mr. Leight to be nominated as a Bacou Director during each
year of the five-year term of the Consulting Agreement, and for
the grant of 50,000 stock options to Mr. Leight in 1998.
Upon consummation of the Leight Transactions, Mr. Leight
joined the Boards of Directors of Bacou and the Principal
Stockholder and, pursuant to the Leight Plan, he received an
option to purchase an aggregate of 50,000 shares of the Common
Stock at an exercise price of $17.00 per share. Under the terms
of

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Real Estate Option and Right of First Refusal Agreement with
Howard S. Leight

Mr. Leight is the owner of a parcel of land adjacent to our
manufacturing facility in San Diego, California (Option
Land). In connection with the Leight Transactions, Bacou
Safety and Mr. Leight entered into a Real Estate Option and
Right of First Refusal Agreement pursuant to which Bacou Safety
obtained the right to purchase the Option Land under certain
terms and conditions in the future. In general, Bacou Safety may
elect to purchase the Option Land for a price equal to the
greater of $750,000 or fair market value determined by
independent appraisal, at any time within a three-year period
beginning December 15, 1999. As of this time, Bacou Safety
has not exercised its option. Also, Mr. Leight is required
to offer the Option Land to Bacou Safety on terms and conditions
as favorable as those applicable to any that Mr. Leight
proposes to accept from a third party at any time in the future.

Lease Agreement with Howard S. Leight

Effective February 27, 1998, Bacou Safety entered into a
lease agreement with Mr. Leight for a 20,000 square foot
warehouse located in Florence, Kentucky (Lease
Agreement) in connection with the Leight Transactions. The
Lease Agreement has an initial lease term of five (5) years
and is subject to two (2) successive options, each of which
would allow us to extend the term for a period of five
(5) years. The Lease Agreement provides for annual rent
equal to $100,000 and is subject to annual increases based upon
increases in the regional Consumer Price Index. Pursuant to the
terms of the Lease Agreement, Bacou Safety is responsible for
payment of taxes, utilities, insurance and certain repairs and
maintenance. Bacou Safety made lease payments totaling
$95,116.41 during 2000 to Mr. Leight (covering
11 monthly payments).

Supply Agreement with respect to Howard Leight Enterprises

Mr. Leight is a principal stockholder of Continental
Polymers, Inc., f/k/a Howard Leight Enterprises, Inc.
(HLE). At the time of the Leight Transactions,
Mr. Leight owned 80% of the capital stock of HLE and served
as a Director and as its President. In connection with the
Leight Transactions, Bacou entered into a letter agreement with
Mr. Leight that Bacou Safety would negotiate a supply
agreement with HLE pursuant to which Bacou would purchase its
requirements for polyurethane pre-polymer (the principal raw
material used in the production of foam hearing protection
products) from HLE for a period of five years, provided that the
quality and price of such raw material offered by HLE are
equivalent to that which is then available from third party
suppliers. Bacou and HLE have not been able to reach agreement
on the terms and conditions of a supply agreement and HLE has
not supplied any samples or production quantities of the
intended product. In February 2000, we filed a declaratory
judgment action with respect to this matter, asking the court to
determine that we had fully discharged our obligations under the
letter agreement. In August of 2000, HLE was added to the suit
as a necessary party and has filed a $4 million counterclaim
against us, which we have denied. Discovery is currently taking
place.






|         |                                                                 
|-------- | ----------------------------------------------------------------
|Item 14. | Exhibits, Financial Statement Schedules and Reports on
	Form 8-K

(a)  1.  List of Financial Statements

The following financial statements are included in Item 8
herein:



| |                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Independent Auditors Report on Consolidated Financial
	Statements 
	 Consolidated Balance Sheets 
	 Consolidated Statements of Income 
	 Consolidated Statements of Stockholders Equity 
	 Consolidated Statements of Cash Flows 
	 Notes to Consolidated Financial Statements

2.  Financial Statement Schedules

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| |                                              
| | ---------------------------------------------
| | Schedule II Valuation and Qualifying Accounts

All other schedules are omitted, since the required information
is not present or is not present in amounts sufficient to
require submission of the schedule, or because the information
required is included in the consolidated financial statements,
and notes thereto.

Independent Auditors Report on Financial Statement Schedule

3.  Exhibits

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FORM 10-K EXHIBITS INDEX

|        |       |  |  |                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------- | ----- |  |  | ---------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |       |  |  |                       
|Number  |       |  |  | Description of Exhibit
|        |       |  |  |                       
|        | 2.1   |  |  |                       |  | Agreement and Plan of Merger dated as of September 30, 1997
	by and among Bacou USA, Inc., ISH Transaction, Inc., Biosystems,
	Inc. and the Shareholders of Biosystems, Inc. (incorporated by
	reference to Exhibit 2(a) of the Companys
	Form 8-K filed October 15, 1997)                                                                                                                                                                                                                                                                                                                         
|        | 2.2   |  |  |                       |  | Asset Purchase Agreement dated December 31, 1997 between
	Bacou USA Safety, Inc. and Howard S. Leight &
	Associates, Inc. (d/b/a Howard Leight Industries) (incorporated
	by reference to Exhibit 2(a) of the Companys
	Form 8-K filed on March 13, 1998)                                                                                                                                                                                                                                                                                                                                          
|        | 2.3   |  |  |                       |  | Letter Agreement by and between Howard S. Leight and Bacou
	USA, Inc. (incorporated by reference to Exhibit 2(b) of the
	Companys Form 8-K filed on March 13, 1998)                                                                                                                                                                                                                                                                                                                                                                                                                                
|        | 2.4   |  |  |                       |  | Letter Agreement by and among Howard S. Leight, Bacou S.A.
	and Engineering Bacou S.A. (incorporated by reference to
	Exhibit 2(c) of the Companys Form 8-K filed on
	March 13, 1998)                                                                                                                                                                                                                                                                                                                                                                                                              
|        | 2.5   |  |  |                       |  | First Amendment to Asset Purchase Agreement dated February 
	27, 1998 (incorporated by reference to Exhibit 2(d) of the
	Companys Form 8-K filed on March 13, 1998)                                                                                                                                                                                                                                                                                                                                                                                                                                
|        | 2.6   |  |  |                       |  | Purchase Agreement dated as of February 24, 1999 by and
	among Perfect Fit Glove Co., Inc. and other parties and Bacou
	USA Safety, Inc. (incorporated by reference to Exhibit 2(a)
	of the Companys Form 10-K filed on March  27,
	1999)                                                                                                                                                                                                                                                                                                                                                          
|        | 3.1   |  |  |                       |  | Amended and Restated Certificate of Incorporation (incorporated
	by reference to Exhibit 3(a) of the Companys
	Registration Statement filed on Form S-1 (Commission File
	No. 333-00470) (the Companys Registration
	Statement))                                                                                                                                                                                                                                                                                                                                                                
|        | 3.2   |  |  |                       |  | Bylaws (incorporated by reference to Exhibit 3(b) of the
	Companys Registration Statement)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|        | 4.1   |  |  |                       |  | Credit Line Agreement by and between Bacou USA, Inc. and Banque
	Nationale de Paris (BNP) dated February 19,
	1998 (incorporated by reference to Exhibit 10(a) of the
	Companys Form 8-K filed on March 13, 1998)                                                                                                                                                                                                                                                                                                                                                                                
|        | 4.2   |  |  |                       |  | Credit Line Agreement by and between Bacou USA, Inc. and BNP
	dated March 25, 1999 (incorporated by reference to
	Exhibit  4.2 of Companys Form 10-K filed
	March 21, 2000)                                                                                                                                                                                                                                                                                                                                                                                                                        
|        | 4.3   |  |  |                       |  | Credit Agreement dated as of August 24, 1999 by and among
	Bacou USA, Inc., Uvex Safety Manufacturing, Inc.
	(USM), BankBoston, N.A.(BKB) (n/k/a
	Fleet National Bank) and KeyBank N.A. (incorporated by reference
	to Exhibit 4(a) of the Companys Form 10-Q filed
	on May 13, 1999), as amended by First Modification to
	Credit Agreement dated as of March  1, 2000 in connection
	with Letter of Credit by Fleet with respect to reissuance of
	$5,590,000 industrial revenue bond for SCHAS (incorporated by
	reference to Exhibit 4.1 of the Companys
	Form 10-Q filed on May 11, 2000)
|        | 4.4   |  |  |                       |  | Bond Purchase Agreement dated as of August 24, 1999 by and
	among Bacou USA, Inc., USM, BKB and the Rhode Island Industrial
	Facilities Corporation (incorporated by reference to
	Exhibit 4(b) of the Companys Form 10-Q filed on
	May  13, 1999)                                                                                                                                                                                                                                                                                                                                                 
|        | 4.5   |  |  |                       |  | Pledge Agreement, dated as of March 1, 2000, by and among
	SCHAS Industries, LLC and Fleet National Bank (incorporated by
	reference to Exhibit 4.2 to the Companys
	Form 10-Q filed May 11, 2000)                                                                                                                                                                                                                                                                                                                                                                                                 
|        | 4.6   |  |  |                       |  | Reimbursement Agreement dated as of March 1, 2000, by and
	among Bacou USA, Inc., SCHAS Industries, LLC and Fleet National
	Bank (incorporated by reference to Exhibit 4.3 of the
	Companys Form 10-Q filed May 11, 2000)                                                                                                                                                                                                                                                                                                                                                                          
|        | 10.1* |  |  |                       |  | Amended and Restated Employment Agreement with Walter Stepan
	dated as of December 1, 1999 (incorporated by reference to
	Exhibit 10.1.4 of Companys Form 10-K filed
	March 21, 2000)                                                                                                                                                                                                                                                                                                                                                                                                              

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|        |        |  |  |                        |  |                                                                                                                                                                                                                                                                                                                  
|------- | ------ |  |  | ---------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |        |  |  |                       
|Number  |        |  |  | Description of Exhibit
|        |        |  |  |                       
|        | 10.2*  |  |  |                       |  | Employment Agreement with Philip B. Barr dated as of
	January 1, 2000 (incorporated by reference to Exhibit 
	10.2.5 of Companys Form 10-K filed March 21,
	2000)                                                                                                                                               
|        | 10.3   |  |  |                       |  | Registration Rights Agreement dated July 31, 1994 by and
	between Walter Stepan and Bacou (incorporated by reference to
	Exhibit 10(h)(i) of Bacous Registration Statement)                                                                                                                                     
|        | 10.4   |  |  |                       |  | Form of Registration Rights Agreement dated February 
	   , 1996 among the Principal Stockholder Figa, S.A.,
	Walter Stepan, Heidemarie Stepan, Bettina Stepan, Axel Stepan
	and Bacou (incorporated by reference to Exhibit  10(i) to
	Amendment No. 1 of Bacous Registration Statement)                       
|        | 10.5   |  |  |                       |  | Registration Rights Agreement dated September 30, 1997 by
	and among Bacou USA and each person identified therein
	(incorporated by reference to Exhibit 2(b) of Bacous
	Form  8-K filed October 15, 1997)                                                                                                      
|        | 10.6   |  |  |                       |  | Corporate Opportunities Agreement dated as of January 1,
	1996 between the Principal Stockholder and Bacou (incorporated
	by reference to Exhibit 10(j) of Bacous Registration
	Statement)                                                                                                                      
|        | 10.7   |  |  |                       |  | Amended and Restated Agreement of Transfer, Trademarks, Know-How
	and Related Matters dated November 2, 1995 by and among
	Uvex Winter Optik GmbH, Uvex Arbeitsschutz GmbH & Co., KG,
	Uvex Winter Optical, Inc. and Uvex Safety (incorporated by
	reference to Exhibit 10(k) of Bacous Registration
	Statement)
|        | 10.8   |  |  |                       |  | License Agreement dated June 1, 1986 between Uvex Winter
	Optik GmbH and Uvex Winter Optical, Inc., as amended by a First
	Amendment dated October 31, 1994 (incorporated by reference
	to Exhibit 10(l) of Bacous Registration Statement)                                                                      
|        | 10.9   |  |  |                       |  | License Agreement dated July 1, 1992 between Uvex Winter
	Optik GmbH and Uvex Winter Optical, Inc., as amended by a First
	Amendment dated October 31, 1994 (incorporated by reference
	to Exhibit 10(m) of Bacous Registration Statement)                                                                      
|        | 10.10  |  |  |                       |  | License and Distribution Agreement dated as of January 1,
	2001 between Bacou S.A. and Perfect Fit (incorporated by
	reference to Exhibit 10.11 of Bacous Form 10-K
	filed March 30, 2001)                                                                                                                      
|        | 10.11* |  |  |                       |  | Bacou USA, Inc. 1996 Stock Incentive Plan (incorporated by
	reference to Exhibit 10(g) of Bacous Registration
	Statement)                                                                                                                                                                                       
|        | 10.12* |  |  |                       |  | Bacou USA, Inc. 1996 Non-Employee Director Stock Option Plan
	(incorporated by reference to Exhibit 10(x) of Bacous
	Form 10-K filed March 31, 1997)                                                                                                                                                            
|        | 10.13  |  |  |                       |  | 1998 Howard S. Leight Stock Option Plan (incorporated by
	reference to Exhibit 10.35 to Bacous Form 10-K
	filed March 27, 1998)                                                                                                                                                                                 
|        | 10.14  |  |  |                       |  | Lease Agreement dated February 27, 1998 by and between
	Howard S. Leight and Bacou Safety (incorporated by
	reference to Exhibit 10.38 of the Companys
	Form 10-K filed March 27, 1998)                                                                                                                         
|        | 10.15* |  |  |                       |  | Bonus and Option Plan for CEO, COO and CFO of Bacou USA, Inc.
	for 2000-2002 (incorporated by reference to Exhibit  10.16
	to Companys Form 10-K filed March 21, 2000)                                                                                                                                          
|        | 10.16* |  |  |                       |  | Bonus Plan for Executives of Bacou USA, Inc. for 2001
	(incorporated by reference to Exhibit 10.17 of Bacous
	Form 10-K filed March 30, 2001)                                                                                                                                                                   
|        | 10.17* |  |  |                       |  | Bonus Plan for Executives of Subsidiaries and Divisions of Bacou
	USA, Inc. for 2001 (incorporated by reference to
	Exhibit 10.18 of Bacous Form 10-K filed
	March 30, 2001)                                                                                                                                    
|        | 10.18* |  |  |                       |  | Consulting Agreement dated as of February 27, 1998 between
	Howard S. Leight and Bacou Safety (incorporated by
	reference to Exhibit 99(e) of Bacous Form 8-K
	filed March 13, 1998)                                                                                                                            

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|        |        |  |  |                        |  |                                                                                                                                                                                            
|------- | ------ |  |  | ---------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |        |  |  |                       
|Number  |        |  |  | Description of Exhibit
|        |        |  |  |                       
|        | 10.19* |  |  |                       |  | Employment Agreement with Alan H. Bennett effective
	January 1, 2000 (incorporated by Reference to the
	Companys Form 10-K filed March 21, 2000)                                          
|        | 10.20* |  |  |                       |  | Employment Agreement with Adrien W. Hebert effective
	January 1, 2000 (incorporated by Reference to the
	Companys Form 10-K filed March 21, 2000)                                         
|        | 10.21* |  |  |                       |  | Employment Agreement dated October 1, 1997 between
	Biosystems, Inc. and John F. Burt, Jr. (incorporated
	by reference to Exhibit 4(d) of the Companys
	Form 10-Q filed November 14, 1997)
|        | 10.22  |  |  |                       |  | Engagement Letter dated July 13, 2000 with Deutsche Bank
	Securities, Inc. (incorporated by Reference to the
	Companys Form 8-K filed on July 14, 2000)                                   
|        | 10.23  |  |  |                       |  | Letter Agreement between Bacou USA, Inc. and the Bacou Family
	dated July 13, 2000 (incorporated by reference to the
	Companys Form 8-K filed on July 14, 2000)                           
|        | 21     |  |  |                       |  | Subsidiaries of Bacou (incorporated by reference to
	Exhibit  21 of Bacous Form 10-K filed
	March 30, 2001)                                                                               
|        | 23     |  |  |                       |  | Accountants Consent                                                                                                                                                                       




|  |                                                        
|- | -------------------------------------------------------
|* | Management contract or compensatory plan or arrangement



| |     |                    
| | --- | -------------------
| | (b) | Reports on Form 8-K

Bacou filed two reports on Form 8-K during the quarterly
period ended December 31, 2000:



| |                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------
| | The first report, dated October 29, 2000, reported the
	Companys sales and earnings for the third quarter of 2000.                 
|
| | The second report, dated December 28, 2000, reported that
	the Companys review of strategic alternatives was
	continuing into 2001.

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SIGNATURES




Pursuant to the requirements of Section 13 or 15(a) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report on Form 10-K/ A to be signed on its behalf by
the undersigned, thereunto duly authorized, in the Town of
Smithfield, State of Rhode Island, on this 25th day of April,
2001.






| |                
| | ---------------
| | BACOU USA, INC.






| |    |                     
| | -- | --------------------
| | By | /s/ JEFFREY T. BROWN




| |                                            
| | -------------------------------------------
| |                                            
|
| | Jeffrey T. Brown                           
|
|
| | Vice President and Chief Accounting Officer
|

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BCOCM-10K-01



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##### Table of Contents






|               |  |                                                               
|-------------- |  | --------------------------------------------------------------
|              
|              
|              
|              
|Item 14(a)  2. |  | Financial Statement Schedules
	Financial Statement Schedule II

Valuation and Qualifying Accounts

|                                  |                              |            |   |            |  |             |   |               |  |            |   |     |  |  |   |     |  |  |   |       | 
|--------------------------------- | ---------------------------- | ---------- | - | ---------- |  | ----------- | - | ------------- |  | ---------- | - | --- |  |  | - | --- |  |  | - | ----- | 
|                                  |                              |            |   | Additions  |  | Additions   |   |               |  |           
|                                  |                              | Balance at |   | Charged to |  | Charged to  |   |               |  | Balance at
|                                  |                              | Beginning  |   | Cost and   |  | Other       |   |               |  | End of    
|                                  |                              | of Period  |   | Expenses   |  | Accounts(1) |   | Deductions(2) |  | Period    
|                                  |                              |            |   |            |  |             |   |               |  |           
|Bad debt allowance (in thousands) |                              |            |   |            |  |             |   |               |  |            |   |     |  |  |   |     |  |  |   |      
|                                 
|                                 
|                                 
|                                 
|                                  | Year ended December 31, 1998 |            | $ | 945        |  |             | $ | 266           |  |            | $ | 150 |  |  | $ | 211 |  |  | $ | 1,150 | 
|                                 
|                                 
|                                 
|                                 
|                                  | Year ended December 31, 1999 |            |   | 1,150      |  |             |   | 110           |  |            |   | 100 |  |  |   | 192 |  |  |   | 1,168 | 
|                                 
|                                 
|                                 
|                                 
|                                  | Year ended December 31, 2000 |            |   | 1,168      |  |             |   | 445           |  |            |   | 50  |  |  |   | 272 |  |  |   | 1,391 | 




|    |                                                                                                
|--- | -----------------------------------------------------------------------------------------------
|(1) | Represents the beginning bad debt allowance of businesses
	acquired during the period.         
|   
|(2) | Deductions consist of uncollectible accounts charged-off during
	the period, net of recoveries.

All other schedules for which provisions are made in the
applicable accounting regulations of the Commission are not
required under the related instructions, are inapplicable or are
not material and therefore have been omitted.