Exhibit 10.4
THE CIT GROUP/COMMERCIAL SERVICES, INC.
00 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
May 31, 2007
Ronson Corporation
Ronson Consumer Products Corporation
Ronson Aviation, Inc.
Ronson Corporation of Canada, Ltd.
Corporate Park III
Xxxxxx Xxxxx
X.X. Xxx 0000 Xxxxxxxx, Xxx Xxxxxx 08875-6707
Attn: Xxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
Re: Financing Agreement dated July 31, 2006 (as amended, restated, modified
and supplemented from time to time, the "Financing Agreement"), by and
among The CIT Group/Commercial Services, Inc., as agent for itself and
for CIT Financial Ltd. ("CIT"), Ronson Corporation ("Ronson"), Ronson
Consumer Products Corporation ("RCPC"), Ronson Aviation, Inc. ("RAI")
and Ronson Corporation of Canada, Ltd. ("Ronson Canada" and, together
with Ronson, RCPC and RAI, each a "Company" and collectively,
"Companies")
Ladies and Gentlemen:
This consent and amendment (the "Second Amendment") shall become
effective upon satisfaction of the conditions precedent set forth in Paragraph 8
below (the date on which this amendment becomes effective shall be referred to
as the "Effective Date"). Capitalized terms used but not otherwise defined
herein shall have the meanings ascribed to them in the Financing Agreement:
1. Consent to EPIC Financing. As of the Effective Date, and subject to
the terms and conditions herein contained, CIT consents to the consummation of
the EPIC Financing (as defined in the amendments to the Financing Agreement
hereinafter set forth) by RAI and Ronson.
2. Specified Intellectual Property. As of the Effective Date, the
Companies acknowledge and agree that the Specified Intellectual Property
Collateral shall secure the Obligations consisting of and arising from the
Initial Term Loan in addition to the Obligations consisting of and arising from
the Initial Additional Term Loan pursuant to the terms of the amendments to the
Financing Agreement hereinafter set forth.
3. Amendments to Financing Agreement Definitions. As of the Effective
Date, Section 1.1 of the Financing Agreement, Definitions, is amended as
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follows:
a. The defined terms "Collateral" and "Qualified Hangar
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Construction Expenses" are amended and restated as set forth below and inserted
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in Section 1.1 where such terms would otherwise alphabetically appear.
Collateral shall mean all assets of the Companies, including
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without limitation, all present and future Accounts,
Equipment, Inventory and other Goods, Documents of Title,
General Intangibles, Investment Property, the Airport Lease
and Other Collateral, but in all cases other than the Real
Property Collateral and the Minority Ronson Canada Interest;
provided, however, that the Collateral shall extend to
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Specified Intellectual Property solely in order to secure the
Obligations consisting of and arising from the Initial Term
Loan and the Initial Additional Term Loan (it being
acknowledged that upon satisfaction of such Obligations, CIT's
security interest in the Specified Intellectual Property shall
be released and the Specified Intellectual Property shall no
longer constitute Collateral).
Qualified Hangar Construction Expenses shall mean all costs
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and expenses incurred by one or more of the Companies in
connection with the construction of and improvements to the
premises located at the Trenton-Xxxxxx County Airport
consisting of a hangar facility and ancillary improvements
covering approximately 19,200 square feet of space, which
costs and expenses shall: (a) include the sums obtained by RAI
in connection with the EPIC Financing; and (b) not exceed
$3,000,000 in the aggregate during the term of this Financing
Agreement.
b. The new defined terms "EPIC", "EPIC Financing" and "EPIC
---- --------------- ----
Financing Documents", as set forth below, are inserted in Section 1.1 of the
--------------------
Financing Agreement where such terms would otherwise alphabetically appear:
EPIC shall mean EPIC Aviation, LLC, d/b/a Air BP Aviation
----
Services, an Oregon limited liability company.
EPIC Financing shall mean the principal sum of up to $500,000
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extended by EPIC to RAI in order to fund certain of the costs
of construction of and improvements to the premises leased to
RAI pursuant to the Airport Lease consisting of a hangar
facility and ancillary improvements covering approximately
19,200 square feet of space (the "Aircraft Hangar") and
evidenced by the EPIC Financing Documents.
EPIC Financing Documents shall mean: (a) a loan agreement by
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and between EPIC and RAI providing for advances to RAI of up
to $500,000; (b) a security agreement to be executed and
delivered by RAI in favor of EPIC granting to EPIC a security
interest and lien in and to the Aircraft Hangar, together with
all improvements and fixtures thereon; (c) a corporate
guaranty to be executed and delivered by Ronson in favor of
EPIC with respect to the obligations of RAI to EPIC; and (d)
an amendment to fuel purchase contract, all in form and
substance heretofore delivered to CIT.
c. Clause (a) of the defined term "Permitted Encumbrances" is
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amended and restated in its entirety as follows:
(a) liens existing on the Closing Date on specific items of
Equipment or created thereafter on specific items of Equipment
or other property in accordance with the terms and conditions
of this Agreement and the other Loan Documents as set forth on
Schedule 1.1(a) attached hereto.
d. Clause (h) of the defined term "Permitted Indebtedness" is
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amended and restated in its entirety as follows:
(h) other Indebtedness existing on the Closing Date or
incurred thereafter in accordance with the terms and
conditions of this Agreement and the other Loan Documents and
set forth on Schedule 1.1(b) attached hereto.
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4. Amendments to Financing Agreement. As of the Effective Date,
a. Section 6.1(a)(y) of the Financing Agreement is amended and
restated in its entirety as follows:
(y) extend to the Specified Intellectual Property solely in
order to secure the Obligations consisting of and arising from
the Initial Term Loan and the Initial Additional Term Loan,
and shall be released at such time as the Obligations
consisting of and arising from the Initial Term Loan and the
Initial Additional Term Loan have been fully and indefeasibly
paid, satisfied and discharged.
b. Section 6.10 of the Financing Agreement is amended and
restated in its entirety as follows:
6.10 Special Provisions Relating to Specified Intellectual
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Property. Upon the full payment, satisfaction and discharge of
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the Initial Term Loan and the Initial Additional Term Loan,
CIT will thereupon release its lien upon and security interest
in the Specified Intellectual Property.
c. Section 10.3(b) of the Financing Agreement is amended and
restated in its entirety as follows:
(b) Specified Intellectual Property. Notwithstanding any
provision to the contrary contained in this Financing
Agreement, CIT may not assert any right, title or interest in
or to the Specified Intellectual Property (other than the
commencement of foreclosure proceedings upon the occurrence of
an Event of Default) unless, during the period extending
ninety (90) days after the commencement of such foreclosure
proceedings, the Companies have not satisfied all Obligations
consisting of and arising from the Initial Term Loan and the
Initial Additional Term Loan.
d. Amendments to Schedules to Financing Agreement. As of the
Effective Date, the EPIC Financing shall constitute Permitted
Indebtedness under the Financing Agreement and the lien and
security interest in the Aircraft Hangar, together with all
improvements and fixtures thereon, granted pursuant to the
EPIC Financing shall constitute a Permitted Encumbrance under
the Financing Agreement. In furtherance of the foregoing,
Schedules 1.1(a) and 1.1(b) of the Financing Agreement are
amended as follows:
(i) Schedule 1.1(a), Permitted Encumbrances, is
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amended to add the following additional
encumbrance as item 6 on such schedule:
6. Subordinated security interest and lien of EPIC in
connection with the EPIC Financing in the right, title and
interest of RAI in and to the 19,200 square foot aircraft
hangar, together with all improvements and fixtures thereon,
to be constructed on the real property leased by RAI pursuant
to the Airport Lease, all as more fully subordinated to CIT,
subject to and in accordance with that certain Subordination
and Intercreditor Agreement dated May 30, 2007, among RAI, CIT
and EPIC.
(ii) Schedule 1.1(b), Permitted Indebtedness,
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Paragraph C, is amended to add the following
Indebtedness of RAI:
The EPIC Financing, fully subordinated to CIT, subject to and
in accordance with that certain Subordination and
Intercreditor Agreement dated May 30, 2007 among RAI, CIT and
EPIC.
5. Representations, Warranties and Statements. The Companies represent
and warrant to CIT that as of the date hereof and except as set forth herein,
(a) except for the representations and warranties set forth in
Sections 6.8 and 6.9 of the Financing Agreement, the representations and
warranties of the Companies set forth in the Financing Agreement are true and
correct as if made on this date, (b) other than Permitted Encumbrances, there
have been no liens, encumbrances, security interests, or claims filed against or
created in any of the Collateral from July 31, 2006 to the date hereof, and (c)
no Default or Event of Default exists under the Financing Agreement.
6. Acknowledgement of Obligations. The Companies acknowledge, confirm
and agree that as of the date hereof the Obligations remain outstanding and
unconditionally owing by the Companies to CIT without defense, set-off,
counterclaim, discount or charge of any kind.
7. Confirmation of Security Interest. As security for the payment or
other satisfaction of the Obligations, the Companies hereby reconfirm the
assignment and grant of a continuing perfected first priority (subject only to
Permitted Encumbrances) lien, charge and security interest in and to the
Collateral, whether now owned or hereafter acquired, created or arising and
wherever located, granted to CIT by the Companies under the Financing Agreement
and the other Loan Documents. The Companies hereby confirm and agree that all
such security interests and liens granted to CIT under the Financing Agreement
and the other Loan Documents continue in full force and effect and shall
continue to secure the Obligations. Nothing herein contained is intended to in
any way impair or limit the validity, priority and extent of CIT's existing
security interest in and liens upon the Collateral.
8. Conditions Precedent. This Second Amendment shall become effective
only upon receipt by CIT of all of the documents or other items set forth below,
all in form and substance satisfactory to CIT and its counsel:
(a) this Second Amendment, duly executed by the Companies;
(b) a Subordination Agreement, duly executed by RAI and EPIC;
(c) the First Amendment to Trademark, Patent and Industrial
Designs Security Agreement, duly executed by Ronson;
(d) Within 2 days of the full execution of same, true and
correct copies of the fully executed EPIC Financing Documents which EPIC
Financing Documents shall include the language set forth in Section 21 of the
Subordination Agreement; and
(e) such other agreements, documents, certificates and
instruments as CIT may reasonably require.
9. Release. Each of the Companies and each Guarantor hereby absolutely
and unconditionally releases and forever discharges CIT, and any and all
participants, parent corporations, subsidiary corporations, affiliated
corporations, insurers, indemnitors, successors and assigns thereof, together
with all of the present and former directors, officers, agents and employees of
any of the foregoing, from any and all claims, demands or causes of action of
any kind, nature or description, whether arising in law or equity or upon
contract or tort or under any state or federal law or otherwise, which any such
Company or such Guarantor has had, now has or has made claim to have against any
such person for or by reason of any act, omission, matter, cause or thing
whatsoever arising from the beginning of time to and including the Effective
Date of this Second Amendment, whether such claims, demands and causes of action
are matured or unmatured or known or unknown.
10. No Other Amendments; No Waiver. Except as expressly modified
hereby, all terms and conditions of the Loan Documents shall remain unmodified
and in full force and effect and are hereby ratified and confirmed by the
Companies, and except as explicitly stated herein nothing contained herein shall
be construed as a waiver by CIT of any rights it may have under the Financing
Agreement, the other Loan Documents or otherwise, to declare a default under the
Financing Agreement or other Loan Documents as a result of any breach by the
Companies, or any of them, of any covenants or agreements contained therein,
whether or not presently known to CIT. The granting of any waiver, consent,
extension or amendment shall not impose or imply an obligation on CIT to grant
any consent, waiver, extension or amendment on any future occasion. Companies
expressly ratify and confirm the waiver of jury trial provisions contained in
the Loan Documents.
11. Counterparts. This document may be executed in counterpart, each of
which counterpart shall be deemed to be an original, and such counterparts,
taken together, shall constitute one and the same document.
Please evidence your agreement to the foregoing by signing below and
returning this letter to us.
Very truly yours,
THE CIT GROUP/COMMERCIAL SERVICES, INC.
By: /s/ Xxxx Xxxxxxxxxx
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Name: Xxxx Xxxxxxxxxx
Title: Vice President
ACKNOWLEDGED and AGREED to on this 30th day of May 2007.
RONSON CORPORATION
By: /s/ Xxxxx X. Xxxxxxx XX
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Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON CONSUMER PRODUCTS CORPORATION
By: /s/ Xxxxx X. Xxxxxxx XX
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Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON AVIATION, INC.
By: /s/ Xxxxx X. Xxxxxxx XX
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Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON CORPORATION OF CANADA LTD.
By: /s/ Xxxxx X. Xxxxxxx XX
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Name: Xxxxx X. Xxxxxxx XX
Title: President
CIT FINANCIAL LIMITED
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: SVP, Chief Risk Officer
CONSENT OF GUARANTORS
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The undersigned Guarantors, intending to be legally bound, do hereby consent to
the execution, delivery and performance of the within and foregoing Amendment
and confirm and reaffirm, without setoff, counterclaim, deduction or other claim
of avoidance of any nature, the continuing effect of each such Guarantor's
Guaranty of the Guaranteed Obligations (as defined in the respective Guaranties)
after giving effect to the foregoing consent and amendment and all prior
consents and amendments.
ACKNOWLEDGED and AGREED to on this 30th day of May 2007.
/s/ Xxxxx X. Xxxxxxx XX
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Xxxxx X. Xxxxxxx XX
RONSON HYDRAULIC UNITS CORPORATION
By: /s/ Xxxxx X. Xxxxxxx XX
------------------------
Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
CONSENT OF AFFILIATED SUBORDINATING CREDITOR
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The undersigned affiliated subordinating creditor, intending to be legally
bound, does hereby consent to the execution, delivery and performance of the
within and foregoing Amendment and confirms and reaffirms, without setoff,
counterclaim, deduction or other claim of avoidance of any nature, the
continuing effect of such subordinating creditor's Subordination Agreement after
giving effect to the foregoing consent and amendment and all prior consents and
amendments.
ACKNOWLEDGED and AGREED to on this 30th day of May 2007.
RONSON HYDRAULIC UNITS CORPORATION
By: /s/ Xxxxx X. Xxxxxxx XX
------------------------
Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
CIT
March 13, 2007
Ronson Corporation
Corporate Xxxx XXX-Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
Ronson Consumer Products Corporation
Corporate Xxxx XXX-Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
Ronson Aviation, Inc.
Trenton-Xxxxxx Xxxxxx Xxxxxxx
Xxxxx Xxxxxxxx, XX 00000
Ronson Corporation of Canada Ltd.
0000 Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxx X0X 0X0
WAIVER, CONSENT AND ACKNOWLEDGEMENT
THIS WAIVER, CONSENT AND ACKNOWLEDGMENT, dated as of March 13, 2007, to the
Financing Agreement, dated as of July 31, 2006 as amended by and among Ronson
Corporation ("Ronson Corp."), Ronson Consumer Products Corporation ("Ronson
Consumer"), Ronson Aviation, Inc. ("Ronson Aviation") and Ronson Corporation of
Canada Ltd. ("Ronson Canada"), and together with Ronson Corp., Ronson Consumer
and Ronson Aviation, each a "Borrower" and collectively, the "Borrowers"), and
The CIT Group/Commercial Services, Inc., a New York corporation ("CIT"), (the
"Financing Agreement").
1. All capitalized terms used herein and not otherwise defined herein are used
herein as defined in the Financing Agreement.
2. Pursuant to the request of the Borrowers and in accordance with Section 10.2
of the Financing Agreement, CIT hereby consents to, and waives any Event of
Default that would otherwise arise under Section 10.1(d) and 10.1(e) of the
Financing Agreement from, any non-compliance by the Borrowers with, the
provisions of Section 7.3(b) of the Financing Agreement by reason of the failure
of the Borrowers to have a Fixed Charge Coverage Ratio of at least 1.15 to 1.0
for the 6-month period ending December 31, 2006, provided that the Fixed Charge
Coverage Ratio was at least 1.00 for such 6-month period.
3. This Waiver, Consent and Acknowledgment shall be governed by the laws of the
State of New York.
4. This Waiver, Consent and Acknowledgment shall be effective only in this
specific instance and for the specific purpose and period set forth herein and
does not allow any other or further departure from the terms of the Financing
Agreement which terms shall continue in full force and effect.
This waiver shall be effective upon receipt by us of an amendment fee in the
amount of Ten Thousand Dollars (or we may charge your Revolving Loan Account in
the amount of such fee pursuant to the Financing Agreement).
You hereby agree to pay to us, as of the date hereof, a documentation fee in the
amount of Three Hundred Dollars ($300.00) to compensate us for use of our
in-house legal department and facilities in documenting this waiver. Such fee
shall be due and payable in full on the date hereof and may, at our option, be
charged to your Loan Account.
CIT Commercial Services
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000 t: 212.461.5200
Except to the extent set forth herein, no other waiver of or change in any of
the terms, provisions or conditions of the Financing Agreement is intended or
implied. This letter agreement shall not constitute a waiver of any other
Default or Event of Default under the Financing Agreement (whether or not we
have knowledge thereof), and shall not constitute a waiver of any future Default
or Event of Default whatsoever.
IN WITNESS WHEREOF, the parties hereto have caused this Waiver, Consent and
Acknowledgment to be executed by their respective officers thereunto duly
authorized as of the day and year first above written.
THE CIT GROUP/COMMERCIAL SERVICES, INC.
By: /s/ Xxxx Xxxxxxxxxx
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Name: Xxxx Xxxxxxxxxx
Title: Vice President
Acknowledged and Agreed:
RONSON CORPORATION
By: /s/ Xxxxx X. Xxxxxxx XX
------------------------
Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON CONSUMER PRODUCTS CORPORATION
By: /s/ Xxxxx X. Xxxxxxx XX
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Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON AVIATION, INC.
By: /s/ Xxxxx X. Xxxxxxx XX
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Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON CORPORATION OF CANADA LTD.
By: /s/ Xxxxx X. Xxxxxxx XX
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Name: Xxxxx X. Xxxxxxx XX
Title: President
Read and agreed to:
CIT FINANCIAL LTD.
By: /s/ Xxxxx Xxxxxxxx
------------------------
Name: Xxxxx Xxxxxxxx
Title: Chief Risk Officer
Except to the extent set forth herein, no other waiver of or change in any of
the terms, provisions or conditions of the Financing Agreement is intended or
implied. This letter agreement shall not constitute a waiver of any other
Default or Event of Default under the Financing Agreement (whether or not we
have knowledge thereof), and shall not constitute a waiver of any future Default
or Event of Default whatsoever.
IN WITNESS WHEREOF, the parties have caused this Waiver, Consent and
Acknowledgment to be executed by their respective officers thereunto duly
authorized as of the day and year first above written.
THE CIT GROUP/COMMERCIAL SERVICES, INC.
By: /s/ Xxxx Xxxxxxxxxx
Name: Xxxx Xxxxxxxxxx
Title: Vice President
Acknowledged and Agreed:
RONSON CORPORATION
By: /s/ Xxxxx X. Xxxxxxx XX
------------------------
Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON CONSUMER PRODUCTS CORPORATION
By: /s/ Xxxxx X. Xxxxxxx XX
------------------------
Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON AVIATION, INC.
By: /s/ Xxxxx X. Xxxxxxx XX
------------------------
Name: Xxxxx X. Xxxxxxx XX
Title: President & CEO
RONSON CORPORATION OF CANADA LTD.
By: /s/ Xxxxx X. Xxxxxxx XX
------------------------
Name: Xxxxx X. Xxxxxxx XX
Title: President
CIT FINANCIAL LTD.
By: /s/ Xxxxx Xxxxxxxx
------------------------
Name: Xxxxx Xxxxxxxx
Title: Chief Risk Officer
