SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1999
Commission File Number 1-1031
RONSON CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
New Jersey 22-0743290
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Corporate Park III-Campus Drive, P.O. Box 6707, Somerset, NJ 08875
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(732) 469-8300
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
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 12 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 ___
As of June 30, 1999, there were 3,197,736 shares of the registrant's common
stock outstanding.
<PAGE>
RONSON CORPORATION
FORM 10-Q INDEX
PART I - FINANCIAL INFORMATION:
CONSOLIDATED BALANCE SHEETS:
JUNE 30, 1999 AND DECEMBER 31, 1998
CONSOLIDATED STATEMENTS OF EARNINGS:
QUARTER ENDED JUNE 30, 1999 AND 1998
SIX MONTHS ENDED JUNE 30, 1999 AND 1998
CONSOLIDATED STATEMENTS OF CASH FLOWS:
SIX MONTHS ENDED JUNE 30, 1999 AND 1998
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
PART II - OTHER INFORMATION:
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
<PAGE>
RONSON CORPORATION AND ITS WHOLLY OWNED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
----------------------------------------------------
(in thousands of dollars)
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
----------- -----------
<S> <C> <C>
ASSETS (unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 56 $ 146
Accounts receivable, net 1,817 1,777
Inventories:
Finished goods 2,667 2,189
Work in process 43 66
Raw materials 408 429
-------- --------
3,118 2,684
Other current assets 1,488 1,447
-------- --------
TOTAL CURRENT ASSETS 6,479 6,054
-------- --------
Property, plant and equipment, at cost:
Land 19 19
Buildings and improvements 4,149 3,740
Machinery and equipment 7,611 7,456
Construction in progress 160 471
-------- --------
11,939 11,686
Less accumulated depreciation and amortization 6,138 5,879
-------- --------
5,801 5,807
Other assets 2,760 2,741
-------- --------
$ 15,040 $ 14,602
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term debt $ 2,440 $ 2,209
Current portion of long-term debt and leases 544 489
Accounts payable 1,987 1,941
Accrued expenses 1,938 1,790
Current liabilities of discontinued operations 1,071 1,833
-------- --------
TOTAL CURRENT LIABILITIES 7,980 8,262
-------- --------
Long-term debt and leases 4,019 3,761
Other long-term liabilities 510 434
STOCKHOLDERS' EQUITY:
Common stock 3,260 3,260
Additional paid-in capital 28,974 29,007
Accumulated deficit (27,060) (27,442)
Accumulated other comprehensive deficit (1,049) (1,086)
-------- --------
4,125 3,739
Less cost of treasury shares 1,594 1,594
-------- --------
TOTAL STOCKHOLDERS' EQUITY 2,531 2,145
-------- --------
$ 15,040 $ 14,602
======== ========
</TABLE>
See notes to consolidated financial statements.
<PAGE>
RONSON CORPORATION AND ITS WHOLLY OWNED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
-----------------------------------------------------------
(in thousands of dollars, except per share data) (unaudited)
<TABLE>
<CAPTION>
Quarter Ended
June 30,
---------------
1999 1998
---- ----
<S> <C> <C>
NET SALES $ 7,141 $ 6,266
------- --------
Cost and expenses:
Cost of sales 4,353 3,810
Selling, shipping and advertising 1,032 890
General and administrative 1,107 996
Depreciation and amortization 140 136
-------- --------
6,632 5,832
-------- --------
EARNINGS FROM OPERATIONS 509 434
-------- --------
Other expense:
Interest expense 163 167
Other-net 35 28
-------- --------
198 195
-------- --------
EARNINGS BEFORE INCOME TAXES 311 239
Income tax expenses (benefits)-net 65 (32)
-------- --------
NET EARNINGS $ 246 $ 271
======== ========
NET EARNINGS PER COMMON SHARE:
Basic $ 0.08 $ 0.08
======== ========
Diluted $ 0.08 $ 0.08
======== ========
</TABLE>
See notes to consolidated financial statements.
<PAGE>
RONSON CORPORATION AND ITS WHOLLY OWNED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
-----------------------------------------------------------
(in thousands of dollars, except per share data) (unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
---------------------
1999 1998
-------- --------
<S> <C> <C>
NET SALES $ 12,750 $ 11,701
-------- --------
Cost and expenses:
Cost of sales 7,584 7,004
Selling, shipping and advertising 1,961 1,760
General and administrative 2,060 1,899
Depreciation and amortization 277 275
-------- --------
11,882 10,938
-------- --------
EARNINGS FROM OPERATIONS 868 763
-------- --------
Other expense:
Interest expense 324 335
Other-net 57 38
-------- --------
381 373
-------- --------
EARNINGS BEFORE INCOME TAXES 487 390
Income tax expenses (benefits)-net 105 (64)
-------- --------
NET EARNINGS $ 382 $ 454
======== ========
NET EARNINGS PER COMMON SHARE:
Basic $ 0.12 $ 0.14
======== ========
Diluted $ 0.12 $ 0.14
======== ========
</TABLE>
See notes to consolidated financial statements.
<PAGE>
RONSON CORPORATION AND ITS WHOLLY OWNED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
----------------------------------------------------
(in thousands of dollars) (unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
-----------------
1999 1998
---- ----
<S> <C> <C>
Cash Flows from Operating Activities:
Net earnings $ 382 $ 454
Adjustments to reconcile net earnings to net cash
provided by (used in) operating activities:
Depreciation and amortization 277 275
Deferred income tax expenses (benefits) 71 (75)
Increase in cash from changes in current assets
and current liabilities (219) 588
Discontinued operations (838) (181)
Other (97) 85
------- -------
Net cash provided by (used in)
operating activities (424) 1,146
------- -------
Cash Flows from Investing Activities:
Net cash used in investing activities,
capital expenditures (268) (92)
------- -------
Cash Flows from Financing Activities:
Proceeds from short-term debt 405 377
Proceeds from long-term debt 629 -
Proceeds from exercise of stock options - 17
Payments of short-term debt (174) (1,015)
Payments of long-term debt (205) (196)
Payments of long-term lease obligations (53) (45)
------- -------
Net cash provided by (used in)
operating activities 602 (862)
------- -------
Net increase (decrease) in cash (90) 192
Cash at beginning of period 146 32
------- -------
Cash at end of period $ 56 $ 224
======= =======
</TABLE>
See notes to consolidated financial statements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE QUARTER AND SIX MONTHS ENDED JUNE 30, 1999 (unaudited)
Note 1: ACCOUNTING POLICIES
Basis of Financial Statement Presentation - The information as of
and for the three-month and six-month periods ended June 30, 1999 and 1998,
is unaudited. In the opinion of management, all adjustments necessary for a
fair presentation of the results of such interim periods have been included.
Discontinued Operations - In December 1989 Ronson Corporation (the
"Company") adopted a plan to discontinue the operations in 1990 of one of
its New Jersey facilities, Ronson Metals Corporation, subsequently renamed
Prometcor, Inc. ("Prometcor"). As a result, the operations of Prometcor have
been classified as discontinued operations in the accompanying Consolidated
Statements of Earnings and other related operating statement data.
This quarterly report should be read in conjunction with the
Company's Annual Report on Form 10-K.
Note 2: PER COMMON SHARE DATA
The calculation and reconciliation of Basic and Diluted Earnings
per Common Share were as follows (in thousands except per share data):
<TABLE>
<CAPTION>
Quarter Ended June 30,
------------------------------------------------------
1999 1998
------------------------------------------------------
Per Per
Share Share
Earnings Shares Amount Earnings Shares Amount
-------- ------ ------ -------- ------ ------
<S> <C> <C> <C> <C> <C> <C>
Net earnings $ 246 $ 271
Less accrued
dividends on
preferred stock (2) (2)
-------- --------
Basic 244 3,198 $0.08 269 3,177 $0.08
===== =====
Effect of dilutive
securities:
Stock options 5 24
Cumulative
convertible
preferred stock 2 36 2 37
-------- ----- -------- -----
Diluted $ 246 3,239 $0.08 $ 271 3,238 $0.08
======== ===== ===== ======== ===== =====
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Six Months Ended June 30,
------------------------------------------------------
1999 1998
------------------------------------------------------
Per Per
Share Share
Earnings Shares Amount Earnings Shares Amount
-------- ------ ------ -------- ------ ------
<S> <C> <C> <C> <C> <C> <C>
Net earnings $ 382 $ 454
Less accrued
dividends on
preferred stock (4) (4)
-------- --------
Basic 378 3,198 $0.12 450 3,172 $0.14
===== =====
Effect of dilutive
securities:
Stock options 6 20
Cumulative
convertible
preferred stock 4 36 4 37
-------- ----- -------- -----
Diluted $ 382 3,240 $0.12 $ 454 3,229 $0.14
======== ===== ===== ======== ===== =====
</TABLE>
There were no securities that were excluded in the computation of Diluted
Earnings Per Share because they were anti-dilutive in the periods presented.
Note 3: SHORT-TERM DEBT
In 1995 Ronson Consumer Products Corporation ("RCPC") entered into an
agreement with Summit Bank ("Summit") for a Revolving Loan. On May 13, 1999,
RCPC and Summit extended RCPC's Revolving Loan to June 30, 2002. The extended
agreement also amended certain other terms of the Revolving Loan agreement. The
Revolving Loan of $1,302,000 at June 30, 1999, is under a line of credit up to
$2,500,000 to RCPC based on its accounts receivable and inventory.
In July 1997 RCPC and Summit amended the Revolving Loan agreement to
provide $400,000 in additional loan availability. The $400,000 additional loan
availability was reduced in monthly amounts of $20,833 to June 1999 when it was
fully amortized. With the extension of the Revolving Loan and the Mortgage Loan
agreement refinancing on May 13, 1999 (refer to Note 4 below), Summit is
providing additional loan availability of $196,000 to be amortized through June
30, 2000, at the rate of approximately $17,000 per month. The additional
available loan of $196,000 had not yet been utilized at June 30, 1999, and,
therefore, is not included in the balance of the Revolving Loan in the paragraph
above.
In 1995 Ronson Corporation of Canada, Ltd. ("Ronson-Canada") entered into
an agreement with Canadian Imperial Bank of Commerce ("CIBC") for a line of
credit of C$250,000. The agreement was extended to May 2000. The Revolving Loan
balance of $100,000 (C$148,000) at June 30, 1999, of Ronson-Canada under the
line of credit is secured by its accounts receivable and inventory. The
Revolving Loan currently bears interest at the rate of 1.25% above CIBC's prime
rate.
At June 30, 1999, Ronson Aviation, Inc. ("Ronson Aviation") had notes
payable consisting of the following: 1) $633,000 due to Raytheon Aircraft Credit
Corp.; and 2) $285,000 due to Summit. These notes are each collateralized by
specific aircraft and are to be repaid from the proceeds from the sale of the
aircraft.
<PAGE>
In August 1997 Ronson Aviation entered into an agreement with Summit for a
Revolving Loan and a Term Loan (refer to Note 4 below regarding the Term Loan).
The Revolving Loan of $120,000 at June 30, 1999, provides a line of credit up to
$400,000 to Ronson Aviation based on the level of its accounts receivable. On
May 13, 1999, the Revolving Loan was extended for two years to June 30, 2002.
Note 4: LONG-TERM DEBT
On May 13, 1999, RCPC and Summit entered into an agreement, in the original
amount of $1,760,000, which refinanced the existing Mortgage Loan agreement on
the RCPC property. The Mortgage Loan balance was approximately $1,750,000 at
June 30, 1999. The amended Mortgage Loan agreement provides for additional funds
of $554,000, is payable in sixty monthly installments of $17,218, including
interest, and a final installment on May 1, 2004, of approximately $1,389,000.
The loan bears interest at a fixed rate of 8.39%.
In August 1997 Ronson Aviation entered into a Term Loan agreement with
Summit in the original amount of $285,000. The Term Loan is payable in monthly
installments of $4,750 plus interest. On May 13, 1999, Ronson Aviation and
Summit amended the Term Loan agreement to extend the payment terms for two years
to June 30, 2002. The Term Loan balance was $185,000 at June 30, 1999.
Ronson Aviation has seven additional term loans payable to Summit with
balances at June 30, 1999, totalling approximately $2,283,000. The loans are
collateralized by specific aircraft.
In September 1998 Ronson Aviation entered into a Promissory Term Note
agreement with Texaco Refining and Marketing, Inc. in the original amount of
$250,000. The Promissory Term Note, with a balance of $236,000 at June 30, 1999,
is payable in 120 monthly installments of $2,775 including interest, through
September 14, 2008. The Promissory Term Note bears interest at the rate of 6%
per annum. The Promissory Term Note is secured by the leased premises of Ronson
Aviation's new aircraft fueling facilities complex and all related equipment,
and also contains restrictive covenants.
<PAGE>
Note 5: CONTINGENCIES
In September 1998 the Company received a "de minimis" settlement offer
("Settlement Offer") from the United States Environmental Protection Agency
("USEPA") related to waste disposed of prior to 1980 at a landfill in Monterey
Park, California, which the USEPA had designated as a Superfund Site ("Site").
The USEPA identified manifests dated from 1974 through 1979 which allegedly
indicate that waste originating at the location of the Company's former Duarte,
California, hydraulic subsidiary was delivered to the Site. As a result, in
August 1995 the Company received a General Notice Letter from the USEPA
notifying the Company that the USEPA considered the Company one of about four
thousand Potentially Responsible Parties ("PRP's") for waste disposed of prior
to 1980 at a landfill at the Site. In 1981 the Company sold the Duarte,
California, hydraulic subsidiary, Ronson Hydraulic Units Corporation
("RHUCOR-CA"), to the Boeing Corporation. The USEPA has notified a subsequent
owner of the facility that the USEPA considers the subsequent owner also liable
for the costs the USEPA determines to be due as a result of RHUCOR-CA's waste
having been sent to the Site. The USEPA may also consider financial factors in
determining the final amount due. In the fourth quarter of 1998 the Company
offered to settle the matter for six equal payments totalling $90,000, to be
paid semiannually over three years. Although the USEPA's Settlement Offer
includes various options at costs of from $307,000 to $376,000 and the Company
has offered to settle the matter for $90,000, the Company's final contribution,
if any, is not yet determinable. The Company has accrued the amount of its offer
and related expenses.
<PAGE>
In February 1999 Ronson Aviation completed the installation of a new 58,500
gallon fueling facility at a total cost of approximately $430,000, and ceased
use of most of its former underground storage tanks. The underground storage
tanks formerly used by Ronson Aviation will be closed in place or removed in
1999 as required by the NJDEP. The extent of any soil and groundwater
contamination cannot be determined until testing has been undertaken. Ronson
Aviation has reached agreement with the lessor, the County of Mercer ("Mercer"),
as to the allocation of responsibility for the costs of meeting regulatory
requirements as to the former tank system because the former tanks are owned by
Mercer and most of the tanks pre-date the lease between Ronson Aviation and
Mercer. Under the agreement, the costs of all removal and reporting activities
will be allocated such that 60% will be paid by Ronson Aviation and 40% will be
paid by Mercer. Ronson Aviation has recorded a provision for the costs estimated
for the removal and reporting activities. The allocation of costs related to
groundwater contamination, if any is determined to be present, has not been
determined. Since the extent of groundwater contamination, if any, and the
associated costs cannot be estimated at this time, the effect on the Company's
financial position or results of future operations cannot be estimated at this
time. Management does not believe that the effect will be material.
In the third quarter of 1998, a mechanical failure at Ronson Aviation
resulted in an overfill of a fuel tank and a release of about 700 gallons of jet
fuel. The Company has taken appropriate action to address the release and to
meet NJDEP requirements. Ronson Aviation has accrued projected future costs
related to the release. Until all required remediation and sampling is
completed, the total cost of the release cannot be determined. The Company's
insurance carriers have been notified of the claim, and management believes that
the Company will receive a reimbursement for the cost from insurance, but the
Company has not recorded a receivable for that reimbursement.
The Company is involved in various lawsuits and claims. While the amounts
claimed may be substantial, the ultimate liability cannot now be determined
because of the considerable uncertainties that exist. Therefore, it is possible
that results of operations or liquidity in a particular period could be
materially affected by certain contingencies. However, based on facts currently
available, including the insurance coverage that the Company has in place,
management believes that the outcome of these lawsuits and claims will not have
a material adverse effect on the Company's financial position.
<PAGE>
Note 6: INDUSTRY SEGMENTS INFORMATION
The Company has two reportable segments: consumer products and aviation
services. The Company's reportable segments are strategic business units that
offer different products and services.
Financial information by industry segment is summarized below (in thousands):
<TABLE>
<CAPTION>
Quarter Ended Six Months Ended
June 30, June 30,
---------------------- ----------------------
1999 1998 1999 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net sales:
Consumer Products $ 4,418 $ 3,880 $ 8,396 $ 7,607
Aviation Services 2,723 2,386 4,354 4,094
-------- -------- -------- --------
Consolidated $ 7,141 $ 6,266 $ 12,750 $ 11,701
======== ======== ======== ========
Earnings (loss) from
operations:
Consumer Products $ 755 $ 594 $ 1,417 $ 1,209
Aviation Services 190 234 264 337
-------- -------- -------- --------
Total reportable segments 945 828 1,681 1,546
Corporate and others (436) (394) (813) (783)
-------- -------- -------- --------
Consolidated $ 509 $ 434 $ 868 $ 763
======== ======== ======== ========
Earnings (loss) before
intercompany charges and
income taxes:
Consumer Products $ 701 $ 537 $ 1,317 $ 1,093
Aviation Services 103 157 100 203
-------- -------- -------- --------
Total reportable segments 804 694 1,417 1,296
Corporate and others (493) (455) (930) (906)
-------- -------- -------- --------
Consolidated $ 311 $ 239 $ 487 $ 390
======== ======== ======== ========
</TABLE>
<PAGE>
Note 7: COMPREHENSIVE INCOME
Comprehensive Income is the change in equity during a period from
transactions and other events from nonowner sources. As required, the Company
classifies items of other comprehensive income in financial statements and
displays the accumulated balance of other comprehensive income (deficit)
separately in the equity section of the Consolidated Balance Sheets.
Changes in the components of Other Comprehensive Income (Loss) and in
Accumulated Other Comprehensive Deficit were as follows (in thousands):
<TABLE>
<CAPTION>
Quarter Ended June 30, 1999 and 1998
------------------------------------
Foreign Currency Minimum Pension Accumulated
Translation Liability Other Comprehensive
Adjustment Adjustment Deficit
---------------- --------------- -------------------
<S> <C> <C> <C>
Balance at
March 31, 1999 $ (92) $ (977) $ (1,069)
Change during second
quarter 1999 7 13 20
--------- --------- ---------
Balance at
June 30, 1999 $ (85) $ (964) $ (1,049)
========= ========= =========
Balance at
March 31, 1998 $ (56) $ (1,505) $ (1,561)
Change during second
quarter 1998 (22) 42 20
--------- --------- ---------
Balance at
June 30, 1998 $ (78) $ (1,463) $ (1,541)
========= ========= =========
</TABLE>
<TABLE>
<CAPTION>
Quarter Ended June 30, 1999 and 1998
------------------------------------
Foreign Currency Minimum Pension Accumulated
Translation Liability Other Comprehensive
Adjustment Adjustment Deficit
---------------- --------------- -------------------
<S> <C> <C> <C>
Balance at
December 31, 1998 $ (96) $ (990) $ (1,086)
Change during six
months ended
June 30, 1999 11 26 37
--------- --------- ---------
Balance at
June 30, 1999 $ (85) $ (964) $ (1,049)
========= ========= =========
Balance at
December 31, 1997 $ (61) $ (1,545) $ (1,606)
Change during six
months ended
June 30, 1998 (17) 82 65
--------- --------- ---------
Balance at
June 30, 1998 $ (78) $ (1,463) $ (1,541)
========= ========= =========
</TABLE>
<PAGE>
Note 8: STATEMENTS OF CASH FLOWS
Certificates of deposit that have a maturity of 90 days or more are
not considered cash equivalents for purposes of the accompanying
Consolidated Statements of Cash Flows.
Supplemental disclosures of cash flow information are as follows
(in thousands):
Six Months Ended
June 30,
----------------
1999 1998
---- ----
Cash Payments for:
Interest $292 $328
Income taxes 28 3
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
RESULTS OF OPERATIONS
Second Quarter 1999 Compared to Second Quarter 1998 and First Half 1999
Compared to First Half 1998.
The Company's Net Sales increased by 14% in the second quarter of 1999
to $7,141,000 from $6,266,000 in the second quarter of 1998. The Company's Net
Sales improved by 9% to $12,750,000 in the first half of 1999 from $11,701,000
in the first half of 1998.
The Company's second quarter 1999 Earnings from Operations increased by
17% to $509,000 from $434,000 in the second quarter 1998. The first half 1999
operating earnings improved by 14% to $868,000 from $763,000 in the first half
of 1998. The Company's Earnings before Income Taxes increased by 30% in the
second quarter of 1999 to $311,000 from $239,000 in the second quarter of 1998.
For the first half of 1999, the Company's Earnings before Income Taxes improved
by 25% to $487,000 from $390,000 in the first half of 1998.
Net Earnings in the second quarter and first half of 1999 would have
exceeded the Net Earnings in the same periods in 1998 were it not for the
increase in deferred income tax expenses for 1999 from deferred income tax
benefits in 1998. Net Earnings in the second quarter of 1999 were $246,000 as
compared to $271,000 in the second quarter of 1998. The second quarter 1999
improvement of $72,000 in Earnings before Income Taxes was more than offset by
an increase of $82,000 in deferred income tax expenses. The Net Earnings in the
first half of 1999 were $382,000 as compared to $454,000 in the first half of
1998. The first half 1999 improvement of $97,000 in Earnings before Income Taxes
was also more than offset by an increase in deferred income tax expenses of
$146,000.
Ronson Consumer Products
- ------------------------
(in thousands)
Quarter Ended Six Months Ended
June 30, June 30,
-------- --------
1999 1998 1999 1998
---- ---- ---- ----
Net sales $ 4,418 $ 3,880 $ 8,396 $ 7,607
Earnings from operations 755 594 1,417 1,209
Earnings before income taxes and
intercompany charges 701 537 1,317 1,093
Net Sales of consumer products at Ronson Consumer Products Corporation
("RCPC"), Woodbridge, New Jersey, and Ronson Corporation of Canada, Ltd.
("Ronson-Canada"), Mississauga, Ontario, (together "Ronson Consumer Products")
increased by 14% in the second quarter of 1999 compared to the second quarter of
1998 primarily due to increased sales of flame accessory products. The Net Sales
at Ronson Consumer Products increased by 10% in the first half of 1999 compared
to the first half of 1998 primarily due to increased sales of flame accessory
and lighter products.
Cost of Sales, as a percentage of Net Sales, at Ronson Consumer
Products was reduced to 50% in the second quarter of 1999 from 52% in the second
quarter of 1998 and to 50% in the first half of 1999 from 51% in the first half
of 1998. These reductions in the Cost of Sales percentage are primarily due to
the increased sales in 1999 and to a change in the mix of products sold.
<PAGE>
Selling, Shipping and Advertising Expenses, as a percentage of Net
Sales, increased to 23% in the second quarter of 1999 from 22% in the second
quarter of 1998. The Selling, Shipping and Advertising Expenses percentage was
unchanged at 23% in the first halves of 1999 and 1998. General and
Administrative Expenses, as a percentage of Net Sales, were unchanged at 9% in
the 1999 and 1998 periods.
The Earnings from Operations at Ronson Consumer Products increased by
27% in the second quarter of 1999 as compared to the second quarter of 1998 and
by 17% in the first half of 1999 as compared to the first half of 1998.
Similarly, Earnings before Income Taxes and Intercompany Charges at Ronson
Consumer Products increased by 31% in the second quarter of 1999 compared to the
second quarter of 1998 and increased by 20% in the first half of 1999 compared
to the first half of 1998. The improvements in earnings at Ronson Consumer
Products in the second quarter and first half of 1999 from the same periods in
1998 were primarily due to the increased Net Sales in 1999.
Ronson Aviation
- ---------------
(in thousands) Quarter Ended Six Months Ended
June 30, June 30,
-------- --------
1999 1998 1999 1998
---- ---- ---- ----
Net sales $ 2,723 $ 2,386 $ 4,354 $ 4,094
Earnings from operations 190 234 264 337
Earnings before income taxes and
intercompany charges 103 157 100 203
Net Sales at Ronson Aviation, Inc. ("Ronson Aviation"), Trenton, New
Jersey, increased by 14% in the second quarter of 1999 from the second quarter
of 1998, and by 6% in the first half of 1999 from the first half of 1998,
primarily due to increased aircraft sales in the second quarter of 1999.
Ronson Aviation's Cost of Sales, as a percentage of Net Sales,
increased to 79% in the second quarter of 1999 from 75% in the second quarter of
1998 and increased to 78% in the first half of 1999 from 76% in the first half
of 1998. The increases in the Cost of Sales percentage in 1999 were primarily
due to the change in mix of products sold; the increase in aircraft sales in
1999, in particular.
Ronson Aviation's Selling, Shipping and Advertising Expenses, as a
percentage of Net Sales, were unchanged from the second quarter and first half
of 1998 to the second quarter and first half of 1999. Ronson Aviation's General
and Administrative Expenses, as a percentage of Net Sales, were unchanged at 11%
in the second quarter of 1999 and 1998 and increased to 12% in the first half of
1999 from 11% in the first half of 1998 primarily due to increases in certain
legal expenses.
FINANCIAL CONDITION
The Company's Stockholders' Equity improved to $2,531,000 at June 30,
1999, from $2,145,000 at December 31, 1998. The improvement of $386,000 in 1999
Stockholders' Equity was primarily due to the Net Earnings of $382,000 in the
first half of 1999. The Company has a deficiency in working capital of
$1,501,000 at June 30, 1999, as compared to $2,208,000 at December 31, 1998. The
improvement of $707,000 in working capital was primarily due to the proceeds of
$554,000 from the increase in the RCPC mortgage from Summit Bank ("Summit") and
to the Company's Net Earnings in the first half of 1999.
<PAGE>
In May 1999 the Company and its principal lender, Summit, reached
agreement to amend the Revolving Loans, Mortgage Loan and Term Loan with RCPC
and Ronson Aviation. The amendments include a new Mortgage Loan to RCPC which
provides additional funds of $554,000 to RCPC and extends the expiration of the
Mortgage Loan to May 1, 2004. The amendments also provide for extensions of the
RCPC Revolving Loan, the Ronson Aviation Revolving Loan, and the Ronson Aviation
Term Loan for two years to June 30, 2002. The RCPC Revolving Loan is amended to
also provide an additional $196,000 in available borrowing, to be amortized
through June 30, 2000. A substantial majority of the total of $750,000 in
additional funds was utilized to meet the cash requirements of the Prometcor,
Inc. ("Prometcor") environmental clearance, which reduced the Current
Liabilities of Discontinued Operations in the first half of 1999. During the
first half of 1999, Prometcor received clearance from the NRC and NJDEP to
demolish the buildings on the Prometcor property which had not previously been
released. The demolition was completed in April 1999. In August 1999 Prometcor
completed the sale of a portion of its property for cash proceeds of about
$100,000. Prometcor has entered into an agreement for the sale of the remainder
of the property, subject only to the necessary environmental clearance.
In the first six months of 1999, Prometcor completed a number of
actions required for environmental clearance of the property, and Prometcor
expended over $800,000 in the first half of 1999 to complete these activities.
As a result, the Current Liabilities of Discontinued Operations were reduced by
$762,000 in the first half of 1999. The full extent of the costs and time
required for completion is not determinable until the remediation and
confirmation testing of the properties have been completed and accepted by the
NJDEP and NRC.
In July 1999 Health Canada issued a notice to Canadian distributors of
seventeen utility lighters advising that Health Canada intended to issue a
warning to Canadian consumers. Ronson-Canada's utility lighter was one of these
seventeen listed. Health Canada requested that the Canadian distributors of the
seventeen utility lighters cooperate in the voluntary withdrawal of these
utility lighters from the Canadian market. Ronson-Canada is complying with the
request even though no incidents or injuries involving the Varaflame Ignitor
have been reported related to the allegations by Health Canada. After further
product testing, Ronson-Canada expects to resume sales in Canada of the ignitors
in the near future. Based upon the safety of the product, on the response from
Ronson-Canada's customers, and on the results of discussions with the Company's
suppliers, the Company believes that the matter will not have a material effect
on the Company's financial condition or results of operations.
The Company has continued to meet its obligations as they have matured
and management believes that the Company will continue to meet its obligations
through internally generated funds from future net earnings and depreciation,
established external financing arrangements, potential additional sources of
financing and existing cash balances.
YEAR 2000 ISSUES
The Company's information technology systems have been reviewed for
Year 2000 ("Y2K") readiness, and actions have been taken to update all material
systems. The information technology systems used at Ronson Aviation were
recently acquired and have been certified Y2K compliant. The necessary upgrades
to the information technology systems utilized by the Company and Ronson
Consumer Products have been acquired. The implementation of these upgraded
systems is substantially complete and will be tested in the third quarter of
1999.
The Company has also reviewed its non-information technology systems.
The Company believes there are no material concerns. This assessment includes
Ronson Aviation's aircraft and related equipment.
<PAGE>
The Company has assessed its material relationships with third parties.
Based on information received from the Company's third parties, the Company
believes that those third parties with which the Company has a material
relationship will not be disrupted by any Y2K issues.
The majority of the costs to address the Company's Y2K issues have been
incurred and have not been material. Any costs remaining are not expected to be
material.
Because of the current status of the Company's preparations related to
the Y2K issues, the Company does not believe there is a material risk of losses
related to the Y2K issues.
For those systems for which compliance has not yet been demonstrated,
the Company is developing contingency plans even though none of those systems
are material to the Company's operations.
<PAGE>
FORWARD-LOOKING STATEMENTS
This Management's Discussion and Analysis of Results of Operations and
Financial Condition and other sections of this report contain forward-looking
statements that anticipate results based on management's plans that are subject
to uncertainty. The use of the words "expects", "plans", "anticipates" and other
similar words in conjunction with discussions of future operations or financial
performance identifies these statements.
Forward-looking statements are based on current expectations of future
events. The Company cannot ensure that any forward-looking statement will be
accurate, although the Company believes that it has been reasonable in its
expectations and assumptions. Investors should realize that if underlying
assumptions prove inaccurate or that unknown risks or uncertainties materialize,
actual results could vary materially from our projections. The Company assumes
no obligation to update any forward-looking statements as a result of future
events or developments.
Investors are cautioned not to place undue reliance on such statements
that speak only as of the date made. Investors also should understand that it is
not possible to predict or identify all such factors and should not consider
this to be a complete statement of all potential risks and uncertainties.
<PAGE>
PART II - OTHER INFORMATION
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
(10) Material Contracts.
On May 13, 1999, Ronson Consumer Products Corporation and Summit Bank
amended the Revolving Loan agreement and refinanced the existing Mortgage Loan
agreement (refer to Notes 3 and 4 of the Notes to Consolidated Financial
Statements). The Revolving Loan and Mortgage Loan agreements are attached hereto
as Exhibits 10(a)-10(f) as follows:
(a) Third Amendment to Loan and Security Agreement between Summit
Bank and Ronson Consumer Products Corporation dated May 13, 1999.
(b) Mortgage Modification Agreement between Summit Bank and Ronson
Consumer Products Corporation dated May 13, 1999.
(c) Amended and Restated Mortgage Note in the amount of
$1,760,000 from Ronson Consumer Products Corporation to Summit Bank
dated May 13, 1999.
(d) Consent and Reaffirmation of Corporate Guarantor by Ronson
Corporation to Summit Bank dated May 13, 1999.
(e) Consent and Reaffirmation of Corporate Guarantor by Ronson
Aviation, Inc. to Summit Bank dated May 13, 1999.
(f) Amended and Restated Master Note in the amount of
$2,500,000 from Ronson Consumer Products Corporation to Summit Bank
dated May 13, 1999.
On May 13, 1999, Ronson Aviation and
Summit Bank amended the Revolving Loan and Term Loan agreements (refer to
Notes 3 and 4 of the Notes to Consolidated Financial Statements). The
Revolving Loan and Term Loan agreements are attached hereto as Exhibits
10(g)-10(k) as follows:
(g) Amendment to Loan and Security Agreement between Ronson Aviation,
Inc. and Summit Bank dated May 13, 1999.
(h) Amended and Restated Master Note in the amount of $400,000 from
Ronson Aviation, Inc. to Summit Bank dated May 13, 1999.
(i) Amended and Restated Term Note in the amount of $190,000 from
Ronson Aviation, Inc. to Summit Bank dated May 13, 1999.
(j) Consent and Reaffirmation of Corporate Guarantor by Ronson
Consumer Products Corporation to Summit Bank dated May 13, 1999.
(k) Consent and Reaffirmation of Corporate Guarantor by Ronson
Corporation to Summit Bank dated May 13, 1999.
(b) Reports on Form 8-K
On June 17, 1999, the Company filed a report on Form 8-K with the
Securities and Exchange Commission providing information in response to Item 5
of such report. No financial statements or pro forma financial information was
included in this report.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
RONSON CORPORATION
Date: August 13, 1999 /s/Louis V. Aronson II
------------------------------
Louis V. Aronson II, President
and Chief Executive Officer
(Signing as Duly Authorized
Officer of the Registrant)
Date: August 13, 1999 /s/Daryl K. Holcomb
--------------------------------
Daryl K. Holcomb, Vice President
and Chief Financial Officer,
Controller and Treasurer
(Signing as Chief Financial
Officer of the Registrant)
Exhibit (a)
THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT (the "Third
Amendment") is made as of this 13th day of May, 1999, by and between RONSON
CONSUMER PRODUCTS CORPORATION, a New Jersey corporation (the "Borrower") and
SUMMIT BANK (the "Bank").
WHEREAS, the Borrower and the Bank are parties to a certain credit
facility, pursuant to a certain Loan and Security Agreement dated January 6,
1995, as amended by certain letter amendments dated August 22, 1995, December 1,
1995, March 20, 1996, May 20, 1996, August 22, 1996, September 10, 1996,
December 12, 1996, July 8, 1997, as of December 31, 1998 and as further amended
by an Amendment to Loan and Security Agreement dated March 6, 1997 and a Second
Amendment to Loan and Security Agreement dated March 27, 1998 (collectively and
individually referred to as the "Loan Agreement") (all capitalized terms used,
but not specifically defined, herein shall have the meaning provided for such
terms in the Loan Agreement); and
WHEREAS, the Borrower has requested that the Bank amend certain
existing financial covenants and otherwise amend certain terms and conditions of
the Loan Agreement; and
WHEREAS, to induce the Bank to amend certain existing financial
covenants and otherwise amend certain terms and conditions of the Loan
Agreement, the Borrower has offered to execute and deliver this Third Amendment;
and
NOW, THEREFORE, in consideration of the foregoing and of other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Bank and the Borrower agree as follows:
1. As of the date of this Third Amendment, Section 1.1(aq) of the
Loan Agreement is amended in its entirety as follows:
"(aq) " Revolving Loan Final Maturity Date": June 30, 2002".
2. As of the date of this Third Amendment, Subsection 2.1(i) of
the Loan Agreement is amended in its entirety to read as follows:
"(i) Should this Borrower terminate the Revolving Loan prior
to the Revolving Loan Final Maturity Date, the Borrower shall pay all other fees
due to Bank under the Loan Agreement, including, without limitation, any
deferred fees set forth herein, along with a prepayment/termination premium in
an amount equal to:
(i) one and one-half (1-1/2%) percent of the maximum
amount of the Revolving Loan if terminated on or before June
30, 2001; and
<PAGE>
(ii) three-quarters (0.75%) percent of the maximum
amount of the Revolving Loan if terminated on or before June
30, 2002.
3. As of the date of this Third Amendment, a new Subsection
2.1(k)(ii) shall be added as follows:
"(k)(ii) Provided no Event of Default has occurred, the Bank
has agreed to make an additional Overadvance available to the Borrower in an
amount not to exceed One Hundred Ninety-Six Thousand and 00/100
($196,000.00)Dollars. The Borrower shall pay to the Bank, upon the making of the
initial withdrawal from the Overadvance, a non-refundable Overadvance facility
fee in an amount equal to One Thousand Nine Hundred Sixty and 00/100 ($1,960.00)
Dollars. Availability under the Overadvance shall be reduced by equal monthly
amounts as nearly equal as practicable commencing on the first day of the month
following usage of the Overadvance. On June 30, 2000 the Overadvance shall be
fully amortized and shall no longer be available to the Borrower under this
Agreement."
4. As of the date of this Third Amendment, Subsection 6.33(a) and
6.33(d) of the Loan Agreement are amended in their entirety to read as follows:
"(a) Minimum Tangible Capital Funds of not less than (i) Two
Million Five Hundred Thousand ($2,500,000.00) Dollars at December 31, 1997 until
December 30, 1998, (ii) the Borrower's actual amount of Tangible Capital Funds
at December 31, 1997, plus Fifty Thousand ($50,000.00) Dollars at December 31,
1998 until December 30, 1999, (iii) the Borrower's actual amount of Tangible
Capital Funds at December 31, 1998, plus Fifty Thousand ($50,000.00) Dollars at
December 31, 1999 until December 30, 2000, and (iv) the Borrower's actual amount
of the Tangible Capital Funds at December 31, 2000, plus Fifty Thousand
($50,000.00) Dollars at December 31, 2001 and thereafter."
"(d) A Minimum Net Profit of not less than (i) Two Million Two
Hundred Fifty Thousand ($2,250,000.00) Dollars for the fiscal year ending
December 31, 1997, (ii) Two Million ($2,000,000.00) Dollars for the fiscal year
ending December 31, 1998, and (iii) Two Million One Hundred Thousand
($2,100,000.00) Dollars for the fiscal year ending December 31, 1999 and at each
fiscal year end thereafter."
5. As of the date of this Third Amendment, Subsection 6.35(a)(v)
shall be amended to read as follows:
"(v) an aggregate amount not to exceed (i) One Million Nine
Hundred Fifty Thousand and 00/100 ($1,950,000.00) Dollars for
the period from January 1, 1999 through and including December
31, 1999, (ii) Two Million One Hundred Thousand
($2,100,000.00) Dollars for the period from January 1, 2000
through and including December 31, 2000, (iii) Two Million Two
Hundred Thousand ($2,200,000.00) Dollars for the period from
January 1, 2001 through and including December 31, 2001 and at
any time of the determination thereafter."
<PAGE>
6. As of the date of this Third Amendment, Subsection 6.35(c)(iv)
shall be amended to read as follows:
"(iv) an aggregate amount not to exceed One Hundred Thousand
and 00/100 ($100,000.00) Dollars during each fiscal year of
the Borrower, provided that, within ten (10) days of each cash
transfer on account of pension liabilities, Ronson Corporation
provides to the Bank proof that each cash transfer was used to
reduce pension liabilities;"
7. As of the date of this Third Amendment, Subsection 6.37(d)
shall be amended to read as follows:
"(d) The maximum cash advances to or for the benefit of
Ronson Metals, now known as Prometcor, shall not
exceed (a) One Million Two Hundred Thousand and
00/100 ($1,200,000.00) Dollars for the fiscal year
1998, (b) One Million Three Hundred Thousand and
00/100 ($1,300,000.00) Dollars for fiscal year 1999,
(c) Two Hundred Fifty Thousand ($250,000.00) Dollars
for the fiscal year 2000, and (d) One Hundred Fifty
Thousand ($150,000.00) Dollars for the fiscal year
2001 and at any time thereafter."
8. As of the date of this Third Amendment, Subsection 6.35(f)
shall be amended to read as follows and Subsection (g) shall be deleted in its
entirety:
"(f) To provide the Borrower with funds to finance
miscellaneous business expenses including dividends
to Shareholders:
(i) an aggregate amount not to exceed Two Hundred
Twenty-Five Thousand and 00/100 ($225,000.00) Dollars
for the fiscal year 1998; and
(ii) an aggregate amount not to exceed One Hundred
Thousand and 00/100 ($100,000.00) Dollars for the
fiscal year 1999;and
(iii) an aggregate amount not to exceed Two Hundred
Fifty Thousand and 00/100 ($250,000.00) Dollars for
the fiscal year 2000; and
(iv) an aggregate amount not to exceed Three Hundred
Thousand and 00/100 ($300,000.00) Dollars for the
fiscal year 2001 and at any time thereafter."
<PAGE>
9. As of the date of this Third Amendment, Subsection 6.38 shall
be amended to read as follows:
"6.38 The aggregate sum of all advances, accounts and notes
receivable due to the Borrower from Ronson Corporation of Canada, Ltd. shall not
exceed at any one time One Million and 00/100 ($1,000,000.00) Dollars as of
December 31, 1999 and at any time thereafter."
10. As of the date of this Third Amendment, Subsection 6.39 shall
be amended to read as follows:
"6.39 The aggregate sum of all advances, accounts and notes
receivable due to the Borrower from Ronson Corporation and the Affiliated
Companies, with the exception of Ronson Corporation of Canada, Ltd., shall not
exceed at any one time, (i) Two Million Five Hundred Thousand and 00/100
($2,500,000.00) Dollars as of December 31, 1997, (ii) Two Million Nine Hundred
Fifty Thousand and 00/100 ($2,950,000.00) Dollars as of December 31, 1998, (iii)
Three Million Seven Hundred Fifty Thousand and 00/100 ($3,750,000.00) Dollars as
of December 31, 1999, (iv) Three Million Nine Hundred Thousand and 00/100
($3,900,000.00) Dollars as of December 31, 2000, and (iv) Four Million Fifty
Thousand and 00/100 ($4,050,000.00) Dollars as of December 31, 2001 and at any
time thereafter."
11. As of the date of this Third Amendment, Subsection 10.9 of the Loan
Agreement shall be amended by deleting the reference to the address "210 Main
Street, Hackensack, New Jersey" and inserting the following address "4900 Route
70, Pennsauken, New Jersey 08109-4792.".
12. In consideration of the Bank's agreement to (i) extend the maturity
date of the Revolving Loan from June 30, 2000 until June 30, 2002 and (ii)
otherwise amend certain terms and conditions of the Loan Agreement as set forth
herein, the Borrower shall pay to the Bank on June 30, 2000, a non-refundable
renewal fee in an amount equal to Fifteen Thousand and 00/100 ($15,000.00)
Dollars, which is and shall be deemed to be earned upon execution hereof. The
Borrower hereby authorizes the Bank to charge the Borrower's Revolving Loan or
demand deposit account maintained with the Bank for the payment of this renewal
fee.
13. To the best of Borrower's knowledge and belief, the Borrower
acknowledges that the advent of the year 2000 shall not adversely affect the
Borrower's operations or the performance of its information technology. Without
limiting the generality of the foregoing, to the best of Borrower's knowledge
and belief (i) the hardware and software utilized by Borrower are designated to
be used prior to, during, and after calendar year 2000 A.D. and such hardware
and software will operate during each such time period without error relating to
date data, specifically including any error relating to, or the conduct of, date
data which represents or references different centuries or more than one
century, (ii) the hardware and software utilized by Borrower will not abnormally
end or provide invalid or incorrect results as a result of date data, and (iii)
the hardware and software utilized by Borrower have be designed to ensure year
2000 A.D. compatibility, including date, century recognition, leap year,
calculations which accommodate same century and multicentury formulas and date
values, and date data interface values that reflect the century.
<PAGE>
14. The Borrower acknowledges and agrees that the Obligations are due
and owing without any defenses, set-offs, recoupments, claims or counterclaims
of any kind as of the date hereof. To the extent that any defenses, set-offs,
recoupments, claims or counterclaims may exist, the Borrower waives and releases
the Bank from same.
15. The Borrower shall pay on demand all reasonable legal fees,
recording expenses and other reasonable and necessary disbursements of the Bank
incident to the preparation, execution and delivery of this Third Amendment.
16. The Borrower acknowledges that its obligations to the Bank pursuant
to the Loan Agreement, as amended herein, are due and owing by the Borrower to
the Bank without any defenses, set-offs, recoupments, claims or counterclaims of
any kind as of the date hereof. To the extent that any defenses, set-offs,
recoupments, claims or counterclaims may exist as of the date hereof, the
Borrower waives and releases the Bank from the same.
17. The Borrower hereby agrees to and does indemnify and hold the Bank
and each of its directors, officers, employees, affiliates, attorneys and agents
harmless from and against any and all liabilities which may be imposed on,
incurred by or asserted against the same in any manner relating to or arising
out of the Loan Agreement or any act, event or transaction related to, attendant
to or preceding the execution of this Third Amendment, other than those
resulting from the Bank's gross negligence or wilful misconduct.
18. The Borrower hereby agrees with, reaffirms and acknowledges the
representations and warranties contained in the Loan Agreement, except as set
forth on Schedule J annexed hereto which shall be deemed to amend Schedule J of
the Loan Agreement. Furthermore, the Borrower represents that the
representations and warranties contained in the Loan Agreement continue to be
true and in full force and effect. This agreement, reaffirmation and
acknowledgment is given to the Bank by the Borrower without defenses, claims or
counterclaims of any kind. To the extent that any such defenses, claims or
counterclaims against the Bank may exist, the Borrower waives and releases the
Bank from the same.
19. The Borrower ratifies and reaffirms all terms, covenants,
conditions and agreements contained in the Loan Agreement.
<PAGE>
20. All other terms and conditions of the Loan Agreement, and any and
all Exhibits annexed thereto and all other writings submitted by the Borrower to
the Bank pursuant thereto, shall remain unchanged and in full force and effect.
21. This Third Amendment shall not constitute a waiver or modification
of any of the Bank's rights and remedies or of any of the terms, conditions,
warranties, representations, or covenants contained in the Loan Agreement,
except as specifically set forth above, and the Bank hereby reserves all of its
rights and remedies pursuant to the Loan Agreement and applicable law.
22. Subject to any applicable grace and/or cure periods under the Loan
Agreement, the failure of the Borrower to satisfy any of the terms and
conditions of this Third Amendment shall constitute an Event of Default under
the Loan Agreement, and the Bank shall be entitled to all of its rights and
remedies under the Loan Agreement and applicable law.
23. This Third Amendment may be executed in counterparts, each of
which, when taken together, shall be deemed to be one and the same instrument.
Executed at Pennsauken, New Jersey, on the date first written above.
ATTEST: RONSON CONSUMER PRODUCTS
CORPORATION
/s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief
Executive Officer
SUMMIT BANK
By: /s/ Amy Lindsay
---------------------------------
Amy Lindsay, Vice President
<PAGE>
Exhibit 10 (b)
MORTGAGE MODIFICATION AGREEMENT
This Mortgage Modification Agreement is made as of the 13th day of May,
1999 between SUMMIT BANK, a banking association, with an office located at 4900
Route 70, Pennsauken, New Jersey (the "Mortgagee"), and RONSON CONSUMER PRODUCTS
CORPORATION, a New Jersey corporation having its principal place of business
located at Corporate Park III, Campus Drive, Post Office Box 6707, Somerset, New
Jersey (the "Mortgagor"), to modify the terms of a certain Mortgage and Security
Agreement dated December 1, 1995 and recorded on December 4, 1995 in the Office
of the Clerk of Middlesex County, New Jersey in Mortgage Book 4997 at Page 060
et seq. (the "Mortgage").
WHEREAS, the Mortgage was given to secure all obligations of the
Mortgagor and Ronson Corporation, a New Jersey corporation, to the Mortgagee,
including, without limitation, the obligations evidenced by a certain Mortgage
Note in the original principal amount of One Million Three Hundred Thousand and
00/100 ($1,300,000.00) Dollars (the "Initial Note"); and
WHEREAS, the lien of the Mortgage encumbers the property commonly known
and designated as Lot 1-D, Block 367, on the Tax Map of the Township of
Woodbridge, Middlesex County, New Jersey, as more particularly described on
Schedule A annexed to the Mortgage (the "Property"); and
WHEREAS, the Mortgagor has requested that the Mortgagee modify certain
terms and conditions of the obligation evidenced by the Note; and
WHEREAS, to induce the Mortgagee to modify certain terms and conditions
of the obligation evidenced by the Note, the Mortgagor has offered to modify
certain terms and conditions of the Mortgage, as set forth herein;
NOW, THEREFORE, in consideration of the foregoing, and of other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Mortgagor and the Mortgagee to modify the terms and conditions
of the Mortgage as follows:
1. The Mortgagor acknowledges that the Borrower is about to execute
and deliver to the Mortgagee an Amended and Restated Mortgage Note in the
principal amount of $1,760,000.00 which shall replace, but not be in
satisfaction of, the Initial Note.
<PAGE>
2. The time for payment of the principal and interest secured by
this Mortgage is hereby extended to May 1, 2004.
3. The principal amount secured by this Mortgage is hereby
increased to One Million Seven Hundred Sixty Thousand ($1,760,000.00) Dollars.
4. In consideration of the Mortgagee entering into this Mortgage
Modification Agreement, the Mortgagor shall pay to the Mortgagee a fee of Eight
Thousand Eight Hundred ($8,800.00) Dollars upon execution hereof and Eight
Thousand Eight Hundred ($8,800.00) Dollars on June 30, 2000. The payment of such
fee shall be deemed fully earned and non-refundable upon execution hereof.
5. Subject to any applicable grace and/or cure periods under the
Mortgage, the failure of the Mortgagor to satisfy any of the terms and
conditions of this Mortgage Modification Agreement shall be deemed to be an
Event of Default pursuant to the Mortgage and the Loan Documents and any and all
sums outstanding pursuant to Note, together with accrued and unpaid interest,
shall become immediately due and payable.
6. All other terms and conditions of the Mortgage shall remain in
full force and effect.
By execution of this Mortgage Modification Agreement on the date shown
above, the undersigned signify their consent to its terms.
Mortgagor acknowledges receipt of a certified copy of this Mortgage
Modification Agreement.
<PAGE>
IN WITNESS WHEREOF, the Mortgagor has hereunto set its hands and seals,
the day and year first above mentioned.
ATTEST: RONSON CONSUMER PRODUCTS
CORPORATION
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II
Assistant Secretary President and Chief
Executive Officer
ATTEST: SUMMIT BANK
/s/ Vincent Giglio By: /s/ Amy Lindsay
--------------------------------- ---------------------------------
Vincent Giglio Amy Lindsay, Vice President
Assistant Treasurer
<PAGE>
----------------------------------------------------------------
MORTGAGE MODIFICATION AGREEMENT
----------------------------------------------------------------
RONSON CONSUMER PRODUCTS CORPORATION
(Mortgagor)
- To -
SUMMIT BANK
(Mortgagee)
----------------------------------------------------------------
Mortgaged Premises:
3 and 6 Ronson Drive (Lot 1-D, Block 367,
Township of Woodbridge, Middlesex County, New Jersey
----------------------------------------------------------------
Dated: As of May 13, 1999
----------------------------------------------------------------
RECORD AND RETURN TO:
REED SMITH SHAW & MCCLAY, LP
Princeton Forrestal Village
136 Main Street. Suite 250
P.O. Box 7839
Princeton, New Jersey 08543-7839
Attn: Jeffrey M. Rosenthal, Esquire
----------------------------------------------------------------
<PAGE>
Exhibit 10 (c)
AMENDED AND RESTATED
MORTGAGE NOTE
$1,760,000.00 Dated: As of May 13, 1999
FOR VALUE RECEIVED, RONSON CONSUMER PRODUCTS CORPORATION, a New Jersey
Corporation ("Ronson Consumer") and RONSON CORPORATION, a New Jersey Corporation
("Ronson") (Ronson Consumer and Ronson are collectively and individually
referred to as the "Borrower"), with offices located at Corporate Park III,
Campus Drive, Post Office Box 6707, Somerset, New Jersey, promises to pay to the
order of SUMMIT BANK, a New Jersey banking corporation (the "Bank"), at its
offices located at 4900 Route 70, Pennsauken, New Jersey 08109-4792, or at such
other place or places as the Bank may designate, the sum of One Million Seven
Hundred Sixty Thousand ($1,760,000.00) Dollars (the "Mortgage Loan"), without
defalcation or discount, for value received, with interest thereon from the date
hereof at the annual rate of eight and thirty-nine hundredths (8.39%) percent
calculated on the basis of a 360-day year for actual days elapsed, all in lawful
money of the United States, as follows: in fifty-nine(59) equal and consecutive
monthly installments of principal and interest of Seventeen Thousand Two Hundred
Eighteen and 12/100 ($17,218.12) Dollars, calculated as aforesaid, commencing on
June 1, 1999 and continuing on the first day of each and every month thereafter
until April 1, 2004 with one (1) final payment due on May 1, 2004 at which time
the balance of principal, any and all unpaid interest thereon, and any other
sums due under this Amended and Restated Mortgage Note (the "Note") shall be due
and payable.
The Borrower shall have the right and privilege of prepaying, at any
time, all or any portion of the outstanding principal amount of the Mortgage
Loan provided, however, that a prepayment premium shall be paid if all, or any
portion, of the Mortgage Loan is prepaid according to the following schedule:
1. if the prepayment is made on or before June 30, 2000, the
prepayment fee shall be three (3%) percent of the amount of the Mortgage Loan
prepaid;
2. if the prepayment is made after June 30, 2000 but on or before
June 30, 2002, the prepayment fee shall be two (2%) percent of the amount of the
Mortgage Loan prepaid;
3. if the prepayment is made after June 30, 2002 but on or before
June 30, 2003, the prepayment fee shall be one (1%) percent of the amount of the
Mortgage Loan prepaid; and
4. if the prepayment is made after June 30, 2003 there shall be no
prepayment fee.
<PAGE>
All payments to be made hereunder shall be automatically charged to an
account of the Borrower at the Bank, and sufficient funds shall be maintained in
the Borrower's accounts for said charge.
This Note is made in accordance with a certain Mortgage and Security
Agreement dated December 1, 1995, as modified by a certain Modification of
Mortgage and Security Agreement dated of even date herewith, executed and
delivered by Ronson Consumer to the Bank (the "Mortgage"). Payment of the
Obligations due under this Note is secured by, inter alia, a first priority lien
and security interest in the Mortgaged Premises defined in the Mortgage which
consists of certain property located at 3 and 6 Ronson Drive, Woodbridge, New
Jersey (the "Property"), and by a certain Assignment of Rents and Leases
executed by Ronson Consumer dated December 1, 1995 (the "Assignment"). All
capitalized terms not specifically defined herein shall be deemed to have the
same definition provided for such terms in the Mortgage. This Amended and
Restated Mortgage Note is the Note referred to in and is subject to the terms
and conditions of the Mortgage. In the event of any ambiguity between the terms
of this Amended and Restated Mortgage Note and the Mortgage, then the terms of
the Mortgage shall govern. An event of default under the Mortgage shall be an
event of default under this Note.
The Mortgage, this Note, the Assignment and all other writings,
documents, and agreements delivered pursuant thereto, are hereinafter
collectively and severally referred to as the "Loan Documents".
The Bank may have made loans to the Borrower and may make additional
loans in the future to the Borrower and may advance sums in the future on behalf
of the Borrower or to protect the security of the Property or liens thereon, at
any time before the satisfaction of this Note and the Mortgage, and all such
sums shall be secured by this Note, the Mortgage, the Assignment and the liens
thereof.
Notwithstanding anything herein to the contrary, if the Borrower
defaults in the performance of any of the terms or provisions of this Note or
the Loan Documents, the principal sum or so much of the principal remaining
unpaid, with all interest accrued thereon shall, at the option of the Bank and
with out notice become due and payable immediately, and interest shall accrue at
two (2%) percent in excess of the interest rate chargeable under this Note,
computed on the basis of actual days elapsed and a year of 360 days, unless
prohibited by law, which interest shall be payable monthly. Payment of the
foregoing may be enforced and recovered at any time by one or more of the
remedies provided to the Bank in this Note, the Mortgage or the Assignment, with
it being specifically understood and agreed that the default provisions as set
forth in the Mortgage shall govern In the event of any conflict in such
provisions in the aforesaid instruments.
<PAGE>
In the event any scheduled payment of principal or interest due
hereunder is received by the Bank more that ten (1) days after the date due,
there shall be due a late charge of five (5%) percent of such payment, which
late charge shall be not less than Twenty-five ($25.00) Dollars nor more that
Two Thousand Five Hundred ($2,500.00) Dollars. Any payment received later than
3:00 p.m. on any banking day shall be deemed to have been received on the next
succeeding banking day. Such late charge represents the cost to Bank in
processing late payments and shall not be deemed to constitute additional
principal or interest. All late charges assessed by the Bank are immediately due
and payable.
In the event it should become necessary to employ counsel to protect the
or enforce this Note, the Borrower agrees to pay (to the extent permitted by
applicable law) costs and reasonable attorney's fees incurred by the Bank in
collecting or enforcing payment thereof.
Any failure by the Bank to insist upon strict performance by the
Borrower of any of the terms and provisions of this Note or the Mortgage shall
not be deemed to be a waiver of any of the terms or provisions thereof, and the
Bank shall have the right thereafter to insist upon strict performance by the
Borrower of any and all of them.
Presentment, demand of payment, notice of dishonor or nonpayment,
protest, notice of protest on this Note, and the giving of notice of default or
other notice to any party liable on this Note are hereby waived by the Borrower.
It is expressly agreed that the maturity of this Note, or any payment hereunder,
may be extended or modified from time to time without in any way affecting the
liability of the Borrower.
The words "Borrower" and "Bank" include singular and plural, individual
or corporation, and the respective heirs, executors, administrators, successors
and of the Borrower or the Bank, as the case may be. The use of any gender
applies to all genders. If more than one party is named as Borrower, the
obligation hereunder of each such party is joint and several.
This Note is given in replacement of and substitution for, but not in
satisfaction of, a certain Mortgage Note dated December 1, 1995 (the "December
1995 Note"). Upon proper execution and delivery hereof, the December 1995 Note
shall be deemed null and void and returned to the Borrower.
<PAGE>
IN WITNESS WHEREOF, the Borrower has executed this instrument the day
and year first above mentioned.
ATTEST: RONSON CONSUMER PRODUCTS
CORPORATION
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief Executive
Officer
ATTEST: RONSON CORPORATION
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief Executive
Officer
<PAGE>
Exhibit 10 (d)
CONSENT AND REAFFIRMATION OF GUARANTOR
THIS CONSENT AND REAFFIRMATION OF GUARANTOR (the "Consent"), is made as
of this 13th day of May, 1999, by RONSON CORPORATION, a New Jersey corporation
with its principal place of business at Corporate Park III, Campus Drive, Post
Office Box 6707, Somerset, New Jersey (the "Guarantor"), to SUMMIT BANK,
successor-by-merger to United Jersey Bank (the "Bank").
WHEREAS, the Bank and Ronson Consumer Products Corporation, a New
Jersey corporation (the "Borrower"), are parties to a certain Loan and Security
Agreement dated January 6, 1995, as amended by certain letter amendments dated
August 22, 1995, December 1, 1995, March 20, 1996, May 20, 1996, August 22,
1996, September 10, 1996 and December 12, 1996, July 8, 1997, as of December 31,
1998, a certain Amendment to Loan and Security Agreement dated March 6, 1997 and
a certain Second Amendment to Loan and Security Agreement dated March 27,
1998(collectively and individually referred to as the "Loan Agreement"),
relating to financing by the Lender to the Borrower as evidenced by a certain
Amended and Restated Master Note dated March 6, 1997 in the maximum principal
amount of Two Million Five Hundred Thousand ($2,500,000.00) Dollars (the "Master
Note") and a certain Term Note dated March 27, 1995 in the original principal
amount of Two Hundred Twenty-Five Thousand ($225,000.00) Dollars, which has been
paid in full (the Loan Agreement, the Master Note and all other documents,
instruments, writings and agreements delivered pursuant thereto are collectively
and individually referred to as the "Loan Documents"); and
WHEREAS, in order to induce the Bank to enter into the Loan Documents,
the Guarantor executed and delivered to the Bank a certain Corporate Guaranty
Agreement dated January 6, 1995 (the "Guaranty"); and
WHEREAS, the Borrower has requested that the Bank amend certain terms
and conditions of the Loan Agreement and to modify certain existing financial
covenants, pursuant to a certain Third Amendment to Loan and Security Agreement
of even date herewith (the "Third Amendment") (the Third Amendment, and any and
all documents, instruments, writings and agreements related thereto are
collectively and individually referred to as the "Amendment Documents"); and
WHEREAS, to induce the Bank to enter into the Amendment Documents, the
Borrower has offered that the Guarantor will (a) acknowledge its consent to the
execution and delivery of the Amendment Documents by the Borrower and (b)
reaffirm the terms and conditions of the Guaranty.
<PAGE>
NOW, THEREFORE, in consideration of the foregoing, and of other good
and valuable consideration, the Guarantor agrees as follows:
1. The Guarantor hereby acknowledges the entry by the Borrower into the
Amendment Documents and hereby ratifies and affirms the actions taken therein.
2. The Guarantor affirms that as of the date hereof there exists no
defense, set-off, or claim of any nature whatsoever to his Guaranty and that the
obligations and liability of the Guarantor under the Guaranty, and the
covenants, representations and warranties of the Guarantor thereunder, remain
absolute, unconditional and in full force and effect.
Executed in Pennsauken, New Jersey on the day and year first written
above.
ATTEST: RONSON CORPORATION
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief
Executive Officer
<PAGE>
Exhibit 10 (e)
CONSENT AND REAFFIRMATION OF GUARANTOR
THIS CONSENT AND REAFFIRMATION OF GUARANTOR (the "Consent"), is made as
of this 13th day of May, 1999, by RONSON AVIATION, INC., a New Jersey
corporation with its principal place of business at Corporate Park III, Campus
Drive, Post Office Box 6707, Somerset, New Jersey (the "Guarantor"), to SUMMIT
BANK, successor-by-merger to United Jersey Bank (the "Bank").
WHEREAS, the Bank and Ronson Consumer Products Corporation, a New
Jersey corporation (the "Borrower"), are parties to a certain Loan and Security
Agreement dated January 6, 1995, as amended by certain letter amendments dated
August 22, 1995, December 1, 1995, March 20, 1996, May 20, 1996, August 22,
1996, September 10, 1996 and December 12, 1996, July 8, 1997, as of December 31,
1998, a certain Amendment to Loan and Security Agreement dated March 6, 1997 and
a certain Second Amendment to Loan and Security Agreement dated March 27,
1998(collectively and individually referred to as the "Loan Agreement"),
relating to financing by the Lender to the Borrower as evidenced by a certain
Amended and Restated Master Note dated March 6, 1997 in the maximum principal
amount of Two Million Five Hundred Thousand ($2,500,000.00) Dollars (the "Master
Note") and a certain Mortgage and Security Agreement dated December 1, 1995 (the
"Mortgage and Security Agreement") relating to financing by the Bank to the
Borrower as evidenced by a certain Mortgage Note dated December 1, 1995 in the
original principal sum of One Million Three Hundred Thousand ($1,300,000.00)
Dollars (the "Mortgage Note") (the Loan Agreement, the Master Note, the Mortgage
and Security Agreement, the Mortgage Note, and all other documents, instruments,
writings and agreements delivered pursuant thereto are collectively and
individually referred to as the "Loan Documents"); and
WHEREAS, in order to induce the Bank to enter into the Loan Documents,
the Guarantor executed and delivered to the Bank a certain Corporate Guaranty
and Security Agreement dated July 8, 1997 (the "Guaranty"); and
WHEREAS, the Borrower has requested that the Bank amend certain terms
and conditions of the Loan Agreement, to amend and restate the Mortgage Note to
a new principal balance of $1,760,000.00 and to modify certain existing
financial covenants, pursuant to a certain Third Amendment to Loan and Security
Agreement of even date herewith (the "Third Amendment") (the Third Amendment,
and any and all documents, instruments, writings and agreements related thereto
are collectively and individually referred to as the "Amendment Documents"); and
<PAGE>
WHEREAS, to induce the Bank to enter into the Amendment Documents, the
Borrower has offered that the Guarantor will (a) acknowledge its consent to the
execution and delivery of the Amendment Documents by the Borrower and (b)
reaffirm the terms and conditions of the Guaranty.
NOW, THEREFORE, in consideration of the foregoing, and of other good
and valuable consideration, the Guarantor agrees as follows:
1. The Guarantor hereby acknowledges the entry by the Borrower into the
Amendment Documents and hereby ratifies and affirms the actions taken therein.
2. The Guarantor affirms that as of the date hereof there exists no
defense, set-off, or claim of any nature whatsoever to his Guaranty and that the
obligations and liability of the Guarantor under the Guaranty, and the
covenants, representations and warranties of the Guarantor thereunder, remain
absolute, unconditional and in full force and effect.
Executed in Pennsauken, New Jersey on the day and year first written
above.
ATTEST: RONSON AVIATION, INC.
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief
Executive Officer
<PAGE>
Exhibit 10 (f)
AMENDED AND RESTATED
MASTER NOTE
$2,500,000.00 Pennsauken, New Jersey
As of May 13, 1999
In consideration of such loans as SUMMIT BANK (the "Lender") from time
to time may elect to make hereon to or for the benefit of or at the request of
RONSON CONSUMER PRODUCTS CORPORATION (the "Borrower"), the Borrower promises to
pay to the order of the Lender, at its office located at 4900 Route 70,
Pennsauken, New Jersey or at such other place or places as the Lender may
designate, in immediately available funds, the sum of TWO MILLION FIVE HUNDRED
THOUSAND ($2,500,000.00) DOLLARS or, if a different dollar amount, then the
outstanding amount of all loans made in accordance with a certain Loan and
Security Agreement dated January 6, 1995 as amended from time to time and as
amended by a certain Amendment to Loan and Security Agreement of even date
herewith by and between the Borrower and the Lender (collectively and
individually the "Loan Agreement"), without defalcation or discount, for value
received, with interest thereon from the date hereof at the rate set forth in
the Loan Agreement, all in lawful money of the United States, on demand, or, if
no demand has been made, then on June 30, 2002. The unpaid balance of each loan
shall bear interest from the date hereof at the rate(s) set forth in the Loan
Agreement. Notwithstanding any other limitations contained in this Amended and
Restated Master Note (the "Note"), the Lender does not intend to charge and the
undersigned shall not be required to pay any interest or other fees or charges
in excess of the maximum permitted by applicable law. Any payments in excess of
such maximum shall be refunded to the undersigned or credited against principal.
The unpaid principal balance hereon at any time shall not exceed Two
Million Five Hundred Thousand ($2,500,000.00) Dollars and shall be equal to the
aggregate amount of all loans then made less the aggregate amount of all
payments then made thereon. The holder hereof is authorized to set forth in
writing from time to time on the reverse hereof the date and amount of each loan
and any payment of principal and the principal balance then unpaid hereon. This
Note is subject to a prepayment penalty as set forth in the Loan Agreement.
This Note is secured by, among other things, a security interest in the
Collateral, as described in the Loan Agreement, which the Borrower and every
other person liable hereon as endorser or guarantor has pledged or deposited
with the Lender. The Collateral is also pledged as security for all of the
Obligations, as defined in the Loan Agreement, of the Borrower to the Lender.
<PAGE>
The Lender shall take reasonable care in custody and preservation of
any Collateral held by it hereunder to the extent required by law, but, if the
Collateral so held consists in whole or in part of instruments or chattel paper,
it shall not be a breach of reasonable care if the Lender does not take
necessary steps to preserve rights against prior parties, nor shall it
constitute a breach of reasonable care if the Lender fails to undertake to
collect the principal of or interest or other increment on any instrument or
investment security, or fails to present any investment security for conversion
or other change, unless, after written notice to the Lender from the Borrower or
from any other party liable hereon in any capacity whose property is held as
collateral hereunder that such interest, other increment or principal is due, or
that such investment security has been called for conversion or other change,
the Lender fails to use reasonable diligence to undertake collection of such
interest, increment or principal, or fails to make presentation for conversion
or other change, or fails to enable the Borrower or such other party to do so.
The Lender may make additional loans in the future to Borrower and may
advance sums in the future on behalf of the Borrower or to protect the security
of the Collateral or lien thereof, at any time before the satisfaction of this
Note and the Loan Agreement, and all such sums shall be evidenced by this Note,
and shall be secured by the Lender's security interest in the Collateral. The
Lender is not responsible in any way for the refusal by its employees to make a
loan or to honor a request for a loan.
This Note is the Master Note referred to in the Loan Agreement, which
contains provisions for the acceleration of the maturity hereof upon the
happening of certain events, for optional and mandatory prepayment of the
principal hereof prior to the maturity hereof and for the amendment or waiver of
certain provisions of the Loan Agreement, all upon the terms and conditions
therein specified. In the event of any ambiguity or inconsistency between the
terms of this Note and the Loan Agreement, then the terms of the Loan Agreement
shall govern.
In the event that any payment shall not be received by Lender within
ten (10) days of the due date, Borrower shall, to the extent permitted by law,
pay Lender a late charge of five (5%) percent of the overdue payment (but in no
event to be less than Twenty Five ($25.00) Dollars nor more than Two Thousand
Five Hundred ($2,500.00) Dollars). Any such late charge assessed is immediately
due and payable.
<PAGE>
The Lender may, without notice to or consent of any party liable for
the payment hereof as maker, endorser or guarantor, and without impairing or in
any way affecting the liability of such person to the Lender (1) extend or
otherwise alter, but not accelerate except as provided in the Loan Agreement,
the time for payment of this Note, (2) alter any other term of this Note by
agreement with the maker hereof, (3) release, or settle or compromise with any
other party liable for the payment hereof, (4) release, or substitute for or
fail to protect any interest in any collateral held by the Lender as security
for the payment of any sum owing to the Lender by any party hereto, and (5)
accept a check or other order that is marked paid in full or with similar
language as a payment under this Note.
No delay or omission on the part of the Lender in exercising any right
hereunder shall operate as a waiver of such right or of any other right under
this Note.
If this Note is referred to an attorney (whether or not a salaried
employee of the Lender) for collection, each party jointly and severally liable
for the payment hereof as maker, endorser or guarantor shall pay, on demand, all
reasonable and necessary expenses or expenditures, including, without
limitation, reasonable attorneys fees and expenses, incurred by the Lender in
protecting, enforcing or exercising its interests, rights or remedies created
by, connected with or provided in this Note and the Loan Agreement, or
performance pursuant to this Note and the Loan Agreement. Attorney's fees may be
collectible from the Collateral to the extent permitted under the Bankruptcy
Code or other law.
If, at the time when this Note is paid in full, any party liable
thereon as maker, endorser or guarantor is liable to the Lender for the payment
of any other debt or liability, the Lender may retain as security for the
payment of such other debts and liabilities the Collateral held by it as
security for the payment of this Note, with all the rights and remedies herein
and otherwise conferred upon the Lender as a secured party by law,
notwithstanding the surrender by the Lender of this Note upon payment hereof.
Upon the occurrence of an Event of Default under the Loan Agreement,
the principal sum or so much of the principal remaining unpaid, with all
interest accrued thereon, shall at the option of the Lender and without notice,
become due and payable immediately, and interest on the principal sum shall
thereafter be computed at the rate of two (2%) percent per year above the
highest rate otherwise payable under this Note. Payment of the foregoing may be
enforced and recovered at any time by one or more of the remedies provided to
Lender in this Note or in the Loan Agreement, with it being specifically
understood and agreed that the default provisions as set forth in the Loan
Agreement shall govern in the event of any conflict in such provisions in the
aforesaid instruments.
<PAGE>
Any failure by Lender to insist upon strict performance by Borrower of
any of the terms and provisions of this Note or of the Loan Agreement shall not
be deemed to be a waiver of any of the terms or provisions thereof, and Lender
shall have the right thereafter to insist upon strict performance by the
Borrower of any and all of them.
Presentment, demand of payment, notice of dishonor or nonpayment,
protest, notice of protest on this Note, and the giving of notice of default or
other notice to any party liable on this Note are hereby waived by the Borrower.
It is expressly agreed that the maturity of this Note, or any payment hereunder,
may be extended or modified from time to time, but not accelerated except as
provided in the Loan Agreement, without in any way affecting the liability of
the Borrower.
For the purposes of this Note, wherever the term "Lender" shall be used
it shall refer to any affiliate or subsidiary of Lender and to any subsequent
holder, successor or assignee hereof unless the context requires otherwise.
The words "Borrower" and "Lender" include singular and plural,
individual or corporation, and the respective heirs, executors, administrators,
successors and assigns of Borrowers or Lender, as the case may be. The use of
any gender applies to all genders. If more than one party is named as Borrower,
the obligation hereunder of each such party is joint and several.
This Note is to be executed and delivered within the State of New
Jersey and the Borrower elects that the laws of the State of New Jersey shall
govern the construction of this Note and the rights, remedies, warranties,
representations, covenants, and provisions hereof.
This Note is given in replacement of and substitution for, but not in
satisfaction of, a certain Master Note dated March 6, 1997 in the principal
amount of Two Million Five Hundred Thousand ($2,500,000.00) Dollars (the "March
1997 Note"). Upon proper execution and delivery hereof, the March 1997 Note
shall be deemed null and void and returned to the Borrower.
IN WITNESS WHEREOF, the undersigned have caused this Note to be
executed the day and year aforesaid.
ATTEST:: RONSON CONSUMER PRODUCTS CORPORATION
<PAGE>
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- --------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief
Executive Officer
<PAGE>
Exhibit 10 (g)
AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT TO LOAN AND SECURITY AGREEMENT (the "Amendment") is made
as of this 13th day of May, 1999, by and between RONSON AVIATION, INC., a New
Jersey corporation (the "Borrower") and SUMMIT BANK, Successor-by-merger to
United Jersey Bank (the "Bank")
WHEREAS, the Borrower and the Bank are parties to a certain credit
facility, pursuant to a certain Loan and Security Agreement dated August 28,
1997, as amended by that certain letter amendment dated March 27, 1998, that
certain letter amendment dated September 3, 1998, and that certain Letter
Amendment dated October 26, 1998 (collectively, the "Loan Agreement") (all
capitalized terms used, but not specifically defined, herein shall have the
meaning provided for such terms in the Loan Agreement); and
WHEREAS, the Borrower has requested that the Bank extend the maturity
date of the Revolving Loan and the Term Loan, and otherwise amend certain terms
and conditions of the Loan Agreement; and
NOW THEREFORE, in consideration of the foregoing and of other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Bank and the Borrower hereby agree as follows:
1. As of the date of this Amendment, Subsections 2.1(d) and
2.1(h) of the Loan Agreement are amended by deleting the existing references to
"June 30, 2000" in said Subsections and inserting in each such place the
reference to "June 30, 2002".
2. As of the date of this Amendment, Subsection 2.1(h)(i)
and (ii) of the Loan Agreement shall be amended as follows:
"i. one and one-half (1 1/2%) percent of the maximum
principal amount prepaid or permanently reduced if such payment or reduction is
made on or before June 30, 2000 and
ii. three-quarters of one (3/4%) percent of the maximum
principal amount prepaid or permanently reduced if such payment or reduction is
made after June 30, 2000 and prior to June 30, 2002."
<PAGE>
3. As of the date of this Amendment, Section 2.2(d) of the
Loan Agreement is hereby amended and restated as follows:
"Method of Payment. The Borrower shall pay the principal
amount of the Term Loan to the Bank in thirty-seven (37) equal and consecutive
monthly principal installments, each in the sum of Four Thousand Seven Hundred
Fifty ($4,750.00) Dollars, plus accrued and unpaid interest, on the first day of
each month commencing June 1, 1999 and a final principal installment on June 30,
2002, together with accrued and unpaid interest. If any payment of principal or
interest shall be due and payable on a day other than a business day of the
Bank, then such payment shall be due and payable on the next succeeding business
day of the Bank."
4. As of the date of this Amendment, Subsection 2.2(f) of
the Loan Agreement is hereby amended and restated as follows:
"Prepayment. The Borrower may prepay, at any time, all
or any portion of the outstanding principal amount of the Term Loan, without
penalty or premium, provided, however, in the event the Borrower prepays the
Term Loan from the proceeds of financing from an alternate lender, then any such
prepayment prior to June 30, 2001 shall be accompanied by a prepayment premium
in an amount equal to four (4%) percent of the principal amount prepaid and any
such prepayment on or after June 30, 2001 and prior to June 30, 2002 shall be
accompanied by a prepayment premium in an amount equal to three (3%) percent of
the principal amount prepaid. In addition to the prepayment premiums above, the
Borrower shall pay other fees due to the Bank under the Loan Agreement,
including, without limitation, any deferred fees set forth herein."
5. The Borrower acknowledges that: (i) the default rate of
interest is a material inducement to Bank to make the loan; (ii) Bank would not
have made the loan in absence of the agreement of the Borrower to pay such
default rate; (iii) the default rate of interest represents compensation for
increased risk to Bank that the loan will not be repaid; and (iv) the default
rate of interest is not a penalty and represents a reasonable estimate of (a)
the cost to Bank in allocating its resources (both personal and financial) to
the ongoing review, monitoring, administration and collection of the loan and
(b) compensation to Bank for losses that are difficult to ascertain.
6. To the best of Borrower's knowledge and belief, the
Borrower acknowledges that the advent of the year 2000 shall not adversely
affect the Borrower's operations or the performance of its information
technology. Without limiting the generality of the foregoing, to the best of
Borrower's knowledge and belief (i) the hardware and software utilized by
Borrower are designated to be used prior to, during, and after calendar year
2000 A.D. and such hardware and software will operate during each such time
period without error relating to date data, specifically including any error
relating to, or the conduct of, date data which represents or references
different centuries or more than one century, (ii) the hardware and software
utilized by Borrower will not abnormally end or provide invalid or incorrect
results as a result of date data, and (iii) the hardware and software utilized
by Borrower have be designed to ensure year 2000 A.D. compatibility, including
date, century recognition, leap year, calculations which accommodate same
century and multicentury formulas and date values, and date data interface
values that reflect the century.
<PAGE>
7. The Borrower acknowledges and agrees that the
Obligations are due and owing without any defenses, set-offs, recoupments,
claims or counterclaims of any kind as of the date hereof. To the extent any
defenses, set-offs, recoupments, claims or counterclaims may exist, the Borrower
waives and releases the Bank from the same.
8. The Borrower hereby agrees to and does indemnify and
hold the Bank and each of its directors, officers, employees, affiliates,
attorney and agents harmless from and against any and all liabilities which may
be imposed on, incurred by or asserted against the same in any manner relating
to or arising out of the Loan Agreement, or any act, event or transaction
related to, attendant to or preceding the execution of this Second Amendment,
other than those resulting from the Bank's gross negligence or willful
misconduct.
9. The Borrower hereby agrees with, reaffirms and
acknowledges the representations and warranties contained in the Loan Agreement.
Furthermore, the Borrower represents that the representations and warranties
contained in the Loan Agreement continue to be true and in full force and
effect. This agreement, reaffirmation and acknowledgment is given to the Bank by
the Borrower without any defenses, claims or counterclaims of any kind. To the
extent that any defenses, claims or counterclaims against the Bank may exist,
the Borrower waives and releases the Bank from the same.
10. The Borrower ratifies and reaffirms all terms,
covenants, conditions and agreements contained in the Loan Agreement.
11. All other terms and conditions of the Loan Agreement,
and any and all exhibits and schedules annexed thereto and all other writings
submitted by the Borrower to the Bank pursuant thereto, shall remain unchanged
and in full force and effect.
<PAGE>
12. This Amendment shall not constitute a waiver or
modification of any of the Bank's rights and remedies or of any of the terms,
conditions, warranties, representations or covenants contained in the Loan
Agreement, except as specifically set forth above, and the Bank hereby reserves
all of its rights and remedies pursuant to the Loan Agreement and applicable
law.
13. Subject to any applicable notice and/or grace periods
under the Loan Agreement, the failure of the Borrower to satisfy any of the
terms and conditions of this Amendment shall constitute an Event of Default
under the Loan Agreement.
14. This Amendment may be executed in any number of
counterparts, each of which, when taken together, shall be deemed one and the
same instrument.
15. As consideration for the Bank to enter into the
Amendment, the Borrower shall pay to the Bank a commitment fee of One Thousand
and 00/100 ($1,000.00) Dollars with respect to the Revolving Loan and One
Thousand and 00/100 ($1,000.00) Dollars with respect to the Term Loan which
shall be due and payable on or before June 30, 2000. All commitment fees shall
be deemed fully earned and non-refundable upon execution hereof.
<PAGE>
Executed at Pennsauken, New Jersey, on the date first written above.
ATTEST: RONSON AVIATION, INC.
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- --------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief
Executive Officer
SUMMIT BANK
By: /s/ Amy Lindsay
--------------------------------
Amy Lindsay, Vice President
<PAGE>
Exhibit 10(h)
AMENDED AND RESTATED
MASTER NOTE
$400,000.00 Pennsauken, New Jersey
As of May 13, 1999
In consideration of such loans as SUMMIT BANK (the "Lender") from time
to time may elect to make hereon to or for the benefit of or at the request of
RONSON AVIATION, INC. (the "Borrower"), the Borrower promises to pay to the
order of the Lender, at its office located at 4900 Route 70, Pennsauken, New
Jersey or at such other place or places as the Lender may designate, in
immediately available funds, the sum of FOUR HUNDRED THOUSAND ($400,000.00)
DOLLARS or, if a different dollar amount, then the outstanding amount of all
loans made in accordance with a certain Loan and Security Agreement dated August
28, 1997 as amended from time to time and as amended by a certain Amendment to
Loan and Security Agreement of even date herewith by and between the Borrower
and the Lender (collectively and individually the "Loan Agreement"), without
defalcation or discount, for value received, with interest thereon from the date
hereof at the rate set forth in the Loan Agreement, all in lawful money of the
United States, on demand, or, if no demand has been made, then on June 30, 2002.
The unpaid balance of each loan shall bear interest from the date hereof at the
rate(s) set forth in the Loan Agreement. Notwithstanding any other limitations
contained in this Amended and Restated Master Note (the "Note"), the Lender does
not intend to charge and the undersigned shall not be required to pay any
interest or other fees or charges in excess of the maximum permitted by
applicable law. Any payments in excess of such maximum shall be refunded to the
undersigned or credited against principal.
The unpaid principal balance hereon at any time shall not exceed Four
Hundred Thousand ($400,000.00) Dollars and shall be equal to the aggregate
amount of all loans then made less the aggregate amount of all payments then
made thereon. The holder hereof is authorized to set forth in writing from time
to time on the reverse hereof the date and amount of each loan and any payment
of principal and the principal balance then unpaid hereon.
This Note is secured by, among other things, a security interest in the
Collateral, as described in the Loan Agreement, which the Borrower and every
other person liable hereon as endorser or guarantor has pledged or deposited
with the Lender. The Collateral is also pledged as security for all of the
Obligations, as defined in the Loan Agreement, of the Borrower to the Lender.
<PAGE>
The Lender shall take reasonable care in custody and preservation of
any Collateral held by it hereunder to the extent required by law, but, if the
Collateral so held consists in whole or in part of instruments or chattel paper,
it shall not be a breach of reasonable care if the Lender does not take
necessary steps to preserve rights against prior parties, nor shall it
constitute a breach of reasonable care if the Lender fails to undertake to
collect the principal of or interest or other increment on any instrument or
investment security, or fails to present any investment security for conversion
or other change, unless, after written notice to the Lender from the Borrower or
from any other party liable hereon in any capacity whose property is held as
collateral hereunder that such interest, other increment or principal is due, or
that such investment security has been called for conversion or other change,
the Lender fails to use reasonable diligence to undertake collection of such
interest, increment or principal, or fails to make presentation for conversion
or other change, or fails to enable the Borrower or such other party to do so.
The Lender may make additional loans in the future to Borrower and may
advance sums in the future on behalf of the Borrower or to protect the security
of the Collateral or lien thereof, at any time before the satisfaction of this
Note and the Loan Agreement, and all such sums shall be evidenced by this Note,
and shall be secured by the Lender's security interest in the Collateral. The
Lender is not responsible in any way for the refusal by its employees to make a
loan or to honor a request for a loan.
This Note is the Master Note referred to in the Loan Agreement, which
contains provisions for the acceleration of the maturity hereof upon the
happening of certain events, for optional and mandatory prepayment of the
principal hereof prior to the maturity hereof and for the amendment or waiver of
certain provisions of the Loan Agreement, all upon the terms and conditions
therein specified. In the event of any ambiguity or inconsistency between the
terms of this Note and the Loan Agreement, then the terms of the Loan Agreement
shall govern.
In the event that any payment shall not be received by Lender within
TEN (10) days of the due date, Borrower shall, to the extent permitted by law,
pay Lender a late charge of five (5%) percent of the overdue payment (but in no
event to be less than Twenty Five ($25.00) Dollars nor more than Two Thousand
Five Hundred ($2,500.00) Dollars). Any such late charge assessed is immediately
due and payable.
The Lender may, without notice to or consent of any party liable for
the payment hereof as maker, endorser or guarantor, and without impairing or in
any way affecting the liability of such person to the Lender (1) extend or
otherwise alter, but not accelerate except as provided in the Loan Agreement,
the time for payment of this Note, (2) alter any other term of this Note by
agreement with the maker hereof, (3) release, or settle or compromise with any
other party liable for the payment hereof, (4) release, or substitute for or
fail to protect any interest in any collateral held by the Lender as security
for the payment of any sum owing to the Lender by any party hereto, and (5)
accept a check or other order that is marked paid in full or with similar
language as a payment under this Note.
<PAGE>
No delay or omission on the part of the Lender in exercising any right
hereunder shall operate as a waiver of such right or of any other right under
this Note.
If this Note is referred to an attorney (whether or not a salaried
employee of the Lender) for collection, each party jointly and severally liable
for the payment hereof as maker, endorser or guarantor shall pay, on demand, all
reasonable and necessary expenses or expenditures, including, without
limitation, reasonable attorneys fees and expenses, incurred by the Lender in
protecting, enforcing or exercising its interests, rights or remedies created
by, connected with or provided in this Note and the Loan Agreement, or
performance pursuant to this Note and the Loan Agreement. Attorney's fees may be
collectible from the Collateral to the extent permitted under the Bankruptcy
Code or other law.
If, at the time when this Note is paid in full, any party liable
thereon as maker, endorser or guarantor is liable to the Lender for the payment
of any other debt or liability, the Lender may retain as security for the
payment of such other debts and liabilities the Collateral held by it as
security for the payment of this Note, with all the rights and remedies herein
and otherwise conferred upon the Lender as a secured party by law,
notwithstanding the surrender by the Lender of this Note upon payment hereof.
Upon the occurrence of an Event of Default under the Loan Agreement,
the principal sum or so much of the principal remaining unpaid, with all
interest accrued thereon, shall at the option of the Lender and without notice,
become due and payable immediately, and interest on the principal sum shall
thereafter be computed at the rate of two (2%) percent per year above the
highest rate otherwise payable under this Note. Payment of the foregoing may be
enforced and recovered at any time by one or more of the remedies provided to
Lender in this Note or in the Loan Agreement, with it being specifically
understood and agreed that the default provisions as set forth in the Loan
Agreement shall govern in the event of any conflict in such provisions in the
aforesaid instruments.
<PAGE>
Any failure by Lender to insist upon strict performance by Borrower of
any of the terms and provisions of this Note or of the Loan Agreement shall not
be deemed to be a waiver of any of the terms or provisions thereof, and Lender
shall have the right thereafter to insist upon strict performance by the
Borrower of any and all of them.
Presentment, demand of payment, notice of dishonor or nonpayment,
protest, notice of protest on this Note, and the giving of notice of default or
other notice to any party liable on this Note are hereby waived by the Borrower.
It is expressly agreed that the maturity of this Note, or any payment hereunder,
may be extended or modified from time to time, but not accelerated except as
provided in the Loan Agreement, without in any way affecting the liability of
the Borrower.
For the purposes of this Note, wherever the term "Lender" shall be used
it shall refer to any affiliate or subsidiary of Lender and to any subsequent
holder, successor or assignee hereof unless the context requires otherwise.
The words "Borrower" and "Lender" include singular and plural,
individual or corporation, and the respective heirs, executors, administrators,
successors and assigns of Borrowers or Lender, as the case may be. The use of
any gender applies to all genders. If more than one party is named as Borrower,
the obligation hereunder of each such party is joint and several.
This Note is to be executed and delivered within the State of New
Jersey and the Borrower elects that the laws of the State of New Jersey shall
govern the construction of this Note and the rights, remedies, warranties,
representations, covenants, and provisions hereof.
This Note is given in replacement of and substitution for, but not in
satisfaction of, a certain Master Note dated August 28, 1997 in the principal
amount of Four Hundred Thousand and 00/100 ($400,000.00) Dollars (the "August
1997 Note"). Upon proper execution and delivery hereof, the August 1997 Note
shall be deemed null and void and returned to the Borrower.
IN WITNESS WHEREOF, the undersigned have caused this Note to be
executed the day and year aforesaid.
ATTEST:: RONSON AVIATION, INC.
<PAGE>
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- --------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief
Executive Officer
<PAGE>
Exhibit 10 (i)
AMENDED AND RESTATED
TERM NOTE
$190,000.00 Pennsauken, New Jersey
As of May 13, 1999
FOR VALUE RECEIVED, RONSON AVIATION, INC. with a principal place of
business at Trenton-Mercer County Airport, Ewing Township, New Jersey 08628-1393
(the "Borrower"), promises to pay to the order of SUMMIT BANK (the "Lender"), at
its office located at 4900 Route 70, Pennsauken, New Jersey, or at such other
place or places as the Lender may designate, in immediately available funds, the
sum of One Hundred Ninety Thousand and 00/100($190,000.00) Dollars, without
defalcation or discount, for value received, with interest thereon from the date
hereof at the rate(s) set forth in a certain Loan and Security Agreement dated
August 28, 1997 as amended from time to time and as amended by a certain
Amendment to Loan and Security Agreement of even date herewith by and between
the Borrower and the Lender (collectively and individually the "Loan
Agreement"), all in lawful money of the United States, as follows: thirty-seven
(37) equal and consecutive monthly installments of principal, each in the sum of
Four Thousand Seven Hundred Fifty ($4,750.00) Dollars, together with accrued and
unpaid interest, commencing June 1, 1999, and continuing on the first day of
each and every month thereafter until June 30, 2002, at which time a final
installment of all outstanding principal, together with any and all accrued and
unpaid interest thereon and any other sums due under this Amended and Restated
Term Note (the "Note"), shall be immediately due and payable.
This Note is secured by, among other things, a security interest in the
Collateral, as described in the Loan Agreement, which the Borrower and every
other person liable hereon as endorser or guarantor has pledged or deposited
with the Lender. The Collateral is also pledged as security for all of the
Obligations, as defined in the Loan Agreement, of the Borrower to the Lender.
The Lender shall take reasonable care in custody and preservation of
any Collateral held by it hereunder to the extent required by law, but, if the
Collateral so held consists in whole or in part of instruments or chattel paper,
it shall not be a breach of reasonable care if the Lender does not take
necessary steps to preserve rights against prior parties, nor shall it
constitute a breach of reasonable care if the Lender fails to undertake to
collect the principal of or interest or other increment on any instrument or
investment security, or fails to present any investment security for conversion
or other change, unless, after written notice to the Lender from the Borrower or
from any other party liable hereon in any capacity whose property is held as
collateral hereunder that such interest, other increment or principal is due, or
that such investment security has been called for conversion or other change,
the Lender fails to use reasonable diligence to undertake collection of such
interest, increment or principal, or fails to make presentation for conversion
or other change, or fails to enable the Borrower or such other party to do so.
<PAGE>
The Lender may make additional loans in the future to Borrower and may
advance sums in the future on behalf of the Borrower or to protect the security
of the Collateral or lien thereof, at any time before the satisfaction of this
Note and the Loan Agreement, and all such sums shall be evidenced by this Note,
and shall be secured by the Lender's security interest in the Collateral. The
Lender is not responsible in any way for the refusal by its employees to make a
loan or to honor a request for a loan.
This Note is the Term Note referred to in the Loan Agreement, which
contains provisions for the acceleration of the maturity hereof upon the
happening of certain events, for optional and mandatory prepayment of the
principal hereof prior to the maturity hereof and for the amendment or waiver of
certain provisions of the Loan Agreement, all upon the terms and conditions
therein specified. In the event of any ambiguity or inconsistency between the
terms of this Note and the Loan Agreement, then the terms of the Loan Agreement
shall govern.
The Lender may, without notice to or consent of any party liable for
the payment hereof as maker, endorser or guarantor, and without impairing or in
any way affecting the liability of such person to the Lender (1) extend or
otherwise alter, but not accelerate except as provided in the Loan Agreement,
the time for payment of this Note, (2) alter any other term of this Note by
agreement with the maker hereof, (3) release, or settle or compromise with any
other party liable for the payment hereof, (4) release, or substitute for or
fail to protect any interest in any collateral held by the Lender as security
for the payment of any sum owing to the Lender by any party hereto, and (5)
accept a check or other order that is marked paid in full or with similar
language as a payment under this Note.
No delay or omission on the part of the Lender in exercising any right
hereunder shall operate as a waiver of such right or of any other right under
this Note.
If this Note is referred to an attorney (whether or not a salaried
employee of the Lender) for collection, each party jointly and severally liable
for the payment hereof as maker, endorser or guarantor shall pay, on demand, all
reasonable and necessary expenses or expenditures, including, without
limitation, reasonable attorneys fees and expenses, incurred by the Lender in
protecting, enforcing or exercising its interests, rights or remedies created
by, connected with or provided in this Note and the Loan Agreement, or
performance pursuant to this Note and the Loan Agreement. Attorney's fees may be
collectible from the Collateral to the extent permitted under the Bankruptcy
Code or other law.
<PAGE>
If, at the time when this Note is paid in full, any party liable
thereon as maker, endorser or guarantor is liable to the Lender for the payment
of any other debt or liability, the Lender may retain as security for the
payment of such other debts and liabilities the Collateral held by it as
security for the payment of this Note, with all the rights and remedies herein
and otherwise conferred upon the Lender as a secured party by law,
notwithstanding the surrender by the Lender of this Note upon payment hereof.
Upon the occurrence of an Event of Default under the Loan Agreement,
the principal sum or so much of the principal remaining unpaid, with all
interest accrued thereon, shall at the option of the Lender and without notice,
become due and payable immediately, and interest on the principal sum shall
thereafter be computed at the rate of two (2%) percent per year above the
highest rate otherwise payable under this Note. Payment of the foregoing may be
enforced and recovered at any time by one or more of the remedies provided to
Lender in this Note or in the Loan Agreement, with it being specifically
understood and agreed that the default provisions as set forth in the Loan
Agreement shall govern in the event of any conflict in such provisions in the
aforesaid instruments.
In the event that any payment shall not be received by Lender within
TEN (10) days of the due date, Borrower shall, to the extent permitted by law,
pay Lender a late charge of five (5%) percent of the overdue payment (but in no
event to be less than Twenty Five ($25.00) Dollars nor more than Two Thousand
Five Hundred ($2,500.00) Dollars). Any such late charge assessed is immediately
due and payable.
Any failure by Lender to insist upon strict performance by Borrower of
any of the terms and provisions of this Note or of the Loan Agreement shall not
be deemed to be a waiver of any of the terms or provisions thereof, and Lender
shall have the right thereafter to insist upon strict performance by the
Borrower of any and all of them.
<PAGE>
Presentment, demand of payment, notice of dishonor or nonpayment,
protest, notice of protest on this Note, and the giving of notice of default or
other notice to any party liable on this Note are hereby waived by the Borrower.
It is expressly agreed that the maturity of this Note, or any payment hereunder,
may be extended or modified from time to time, but not accelerated except as
provided in the Loan Agreement, without in any way affecting the liability of
the Borrower.
For the purposes of this Note, wherever the term "Lender" shall be used
it shall refer to any affiliate or subsidiary of Lender and to any subsequent
holder, successor or assignee hereof unless the context requires otherwise.
The words "Borrower" and "Lender" include singular and plural,
individual or corporation, and the respective heirs, executors, administrators,
successors and assigns of Borrowers or Lender, as the case may be. The use of
any gender applies to all genders. If more than one party is named as Borrower,
the obligation hereunder of each such party is joint and several.
This Note is to be executed and delivered within the State of New
Jersey and the Borrower elects that the laws of the State of New Jersey shall
govern the construction of this Note and the rights, remedies, warranties,
representations, covenants, and provisions hereof.
<PAGE>
This Note is given in replacement of and substitution for, but not in
satisfaction of, a certain Term Note dated August 28, 1997 in the principal
amount of Two Hundred Eighty-Five Thousand and 00/100 ($285,000.00) Dollars (the
"August 1997 Note"). Upon proper execution and delivery hereof, the August 1997
Note shall be deemed null and void and returned to the Borrower.
IN WITNESS WHEREOF, the undersigned have caused this Note to be
executed the day and year aforesaid.
ATTEST: RONSON AVIATION, INC.
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief
Executive Officer
<PAGE>
Exhibit 10 (j)
CONSENT AND REAFFIRMATION OF GUARANTOR
THIS CONSENT AND REAFFIRMATION OF GUARANTOR (the "Consent"), is made as
of this 13th day of May, 1999, by RONSON CONSUMER PRODUCTS CORPORATION, a New
Jersey corporation with its principal place of business at Corporate Park III,
Campus Drive, Post Office Box 6707, Somerset, New Jersey (the "Guarantor"), to
SUMMIT BANK, successor-by-merger to United Jersey Bank (the "Bank").
WHEREAS, the Bank and Ronson Aviation, Inc., a New Jersey corporation
(the "Borrower"), are parties to a certain Loan and Security Agreement dated
August 28, 1997, (the "Loan Agreement"), relating to financing by the Lender to
the Borrower as evidenced by a certain Master Note dated August 28, 1997 in the
maximum principal amount of Four Hundred Thousand ($400,000.00) Dollars (the
"Master Note") and a certain Term Note dated August 28, 1997 in the original
principal amount of Two Hundred Eighty-Five Thousand ($285,000.00) Dollars (the
"Term Note") (the Loan Agreement, the Master Note, the Term Note, and all other
documents, instruments, writings and agreements delivered pursuant thereto are
collectively and individually referred to as the "Loan Documents"); and
WHEREAS, in order to induce the Bank to enter into the Loan Documents,
the Guarantor executed and delivered to the Bank a certain Corporate Guaranty
Agreement dated August 28, 1997 (the "Guaranty"); and
WHEREAS, the Borrower has requested that the Bank amend certain terms
and conditions of the Loan Agreement, pursuant to a certain Amendment to Loan
and Security Agreement of even date herewith (the "Amendment") (the Amendment,
and any and all documents, instruments, writings and agreements related thereto
are collectively and individually referred to as the "Amendment Documents"); and
WHEREAS, to induce the Bank to enter into the Amendment Documents, the
Borrower has offered that the Guarantor will (a) acknowledge its consent to the
execution and delivery of the Amendment Documents by the Borrower and (b)
reaffirm the terms and conditions of the Guaranty.
NOW, THEREFORE, in consideration of the foregoing, and of other good
and valuable consideration, the Guarantor agrees as follows:
<PAGE>
1. The Guarantor hereby acknowledges the entry by the Borrower into
the Amendment Documents and hereby ratifies and affirms the actions taken
therein.
2. The Guarantor affirms that as of the date hereof there exists no
defense, set-off, or claim of any nature whatsoever to its Guaranty and that the
obligations and liability of the Guarantor under the Guaranty, and the
covenants, representations and warranties of the Guarantor thereunder, remain
absolute, unconditional and in full force and effect.
Executed in Pennsuaken, New Jersey on the day and year first written
above.
ATTEST: RONSON CONSUMER PRODUCTS
CORPORATION
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief
Executive Officer
<PAGE>
Exhibit 10 (k)
CONSENT AND REAFFIRMATION OF GUARANTOR
THIS CONSENT AND REAFFIRMATION OF GUARANTOR (the "Consent"), is made as
of this 13th day of May, 1999, by RONSON CORPORATION, a New Jersey corporation
with its principal place of business at Corporate Park III, Campus Drive, Post
Office Box 6707, Somerset, New Jersey (the "Guarantor"), to SUMMIT BANK,
successor-by-merger to United Jersey Bank (the "Bank").
WHEREAS, the Bank and Ronson Aviation, Inc., a New Jersey corporation
(the "Borrower"), are parties to a certain Loan and Security Agreement dated
August 28, 1997, (the "Loan Agreement"), relating to financing by the Lender to
the Borrower as evidenced by a certain Master Note dated August 28, 1997 in the
maximum principal amount of Four Hundred Thousand ($400,000.00) Dollars (the
"Master Note") and a certain Term Note dated August 28, 1997 in the original
principal amount of Two Hundred Eighty-Five Thousand ($285,000.00) Dollars (the
"Term Note") (the Loan Agreement, the Master Note, the Term Note, and all other
documents, instruments, writings and agreements delivered pursuant thereto are
collectively and individually referred to as the "Loan Documents"); and
WHEREAS, in order to induce the Bank to enter into the Loan Documents,
the Guarantor executed and delivered to the Bank a certain Corporate Guaranty
Agreement dated August 28, 1997 (the "Guaranty"); and
WHEREAS, the Borrower has requested that the Bank amend certain terms
and conditions of the Loan Agreement, pursuant to a certain Amendment to Loan
and Security Agreement of even date herewith (the "Amendment") (the Amendment,
and any and all documents, instruments, writings and agreements related thereto
are collectively and individually referred to as the "Amendment Documents"); and
WHEREAS, to induce the Bank to enter into the Amendment Documents, the
Borrower has offered that the Guarantor will (a) acknowledge its consent to the
execution and delivery of the Amendment Documents by the Borrower and (b)
reaffirm the terms and conditions of the Guaranty.
NOW, THEREFORE, in consideration of the foregoing, and of other good
and valuable consideration, the Guarantor agrees as follows:
<PAGE>
1. The Guarantor hereby acknowledges the entry by the Borrower into
the Amendment Documents and hereby ratifies and affirms the actions taken
therein.
2. The Guarantor affirms that as of the date hereof there exists no
defense, set-off, or claim of any nature whatsoever to its Guaranty and that the
obligations and liability of the Guarantor under the Guaranty, and the
covenants, representations and warranties of the Guarantor thereunder, remain
absolute, unconditional and in full force and effect.
Executed in Pennsauken, New Jersey on the day and year first
written above.
ATTEST: RONSON CORPORATION
By: /s/ Alberta D. Gladis By: /s/ Louis V. Aronson, II
----------------------------- ---------------------------------
Alberta D. Gladis, Louis V. Aronson, II,
Assistant Secretary President and Chief Executive
Officer
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<PERIOD-END> JUN-30-1999
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<INVENTORY> 3,118
<CURRENT-ASSETS> 6,479
<PP&E> 11,939
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0
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<COMMON> 3,260
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