SEVENTEENTH AMENDMENT TO FORBEARANCE AGREEMENT

This Seventeenth Amendment to Forbearance Agreement (the “Amendment”) is entered
into as of this 7th day of May, 2010 by and among RCLC, Inc. (formerly known as
Ronson Corporation), a New Jersey corporation (“Parent”), RCPC Liquidating Corp.
(formerly known as Ronson Consumer Products Corporation), a New Jersey
corporation (“RCPC”), Ronson Aviation, Inc., a New Jersey corporation (“RAI”)
and RCC Inc. (formerly known as Ronson Corporation of Canada Ltd.), an Ontario
corporation (“Ronson Canada”) (RCPC and RAI are collectively and individually
referred to as the “Domestic Borrower” or “Domestic Borrowers”; the Domestic
Borrower and Ronson Canada are collectively and individually referred to as the
“Borrower” or “Borrowers”, and the Borrowers, together with Parent are
collectively and individually referred to as the “Obligors”) and Wells Fargo
Bank, National Association (“Lender”), acting through its Wells Fargo Business
Credit operating division.
 
RECITALS:
 
Borrowers and Lender are parties to a certain Credit and Security Agreement
dated as of May 30, 2008 (as amended, modified, supplemented or restated from
time to time, the “Credit Agreement”), relating to financing by Lender to
Borrowers.  Capitalized terms used but not specifically defined herein shall
have the meanings provided for such terms in the Credit Agreement.
 
Certain Events of Default occurred under the Credit Agreement and, as a result
thereof, Lender and Borrowers entered into that certain Forbearance Agreement
dated as of March 29, 2009 (as amended modified, supplemented or restated from
time to time, the “Forbearance Agreement”), whereby Lender agreed to forbear
from exercising certain of its rights and remedies available under the Loan
Documents as a result of the Existing Events of Default.
 
The Forbearance Agreement expires pursuant to its terms not later than May 7,
2010.
 
On February 2, 2010, Parent, RCPC and Ronson Canada consummated a transaction
(the “Zippo Sale”) pursuant to which RCPC and Ronson Canada sold substantially
all of their assets to Zippo Manufacturing Company and Nosnor, Inc., pursuant to
an Asset Purchase Agreement dated as of October 5, 2010.  The net proceeds of
the Zippo Sale were delivered to Lender in accordance with the terms of that
certain letter agreement by and among Lender and Obligors dated as of February
2, 2010 and applied by Lender in accordance with and subject to the Thirteenth
Amendment to Forbearance Agreement dated as of April 1, 2010.
 
Borrowers have requested that Lender amend the definition of Termination Event
to, among other things, extend the stated expiration date in the Forbearance
Agreement from May 7, 2010 to June 11, 2010 in order to (i) provide Borrowers
with additional time to (a) consummate the sale of RAI’s assets to Hawthorne TTN
Holdings, LLC (“Hawthorne”) pursuant to that certain Asset Purchase Agreement
dated as of May 15, 2009, as amended  from time to time, and (b) explore a sale
of RAI and/or its assets to a third-party other than Hawthorne (an “Alternate
Transaction”) and (ii) amend certain terms and conditions of the Credit
Agreement.
 

 
 

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 Lender has considered Borrowers’ requests and, in an effort to continue working
with Borrowers, hereby agrees to amend the Forbearance Agreement and the Credit
Agreement on the terms and conditions set forth below.
 
NOW, THEREFORE, for and in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
 
1.            Amendment to Forbearance Agreement.  As of the date hereof,
Section 2(b) of the Forbearance Agreement shall be amended and restated in its
entirety to read as follows:
 
(b)           For purposes of this Agreement, a “Termination Event” shall mean
the earliest to occur of (i) June 11, 2010 and (ii) any one or more of the
following:
 
(A)           the failure of the Obligors to comply with the terms, covenants,
agreements and conditions of this Agreement;
 
(B)           any representation or warranty made herein shall be incorrect in
any material respect;
 
(C)           the occurrence of any Event of Default under the Credit Agreement,
other than (i) the Existing Events of Default or (ii) breach by Obligors of
their obligation pursuant to (a) Section 6.1(a) of the Credit Agreement to
deliver audited year end annual financial statements for the fiscal year ending
December 31, 2008 within 90 days of the end of such fiscal year or (b) Section
6.1(c) of the Credit Agreement to deliver monthly financial statements to Lender
for the months ending October 31, 2009, November 30, 2009, December 31,
2009,  January 31, 2010, February 28, 2010, March 31, 2010 and April 30, 2010
within 30 days of the end of such months;
 
(D)           Obligors shall fail to employ a CRO (as defined below) throughout
the term of this Agreement;
 
(E)           subject to Paragraph 6(b) below, Obligors shall fail to employ an
investment banking firm reasonably acceptable to Lender to market and sell RAI
or its assets throughout the term of this Agreement and/or such investment
banking firm shall fail to diligently pursue such sale consistent with the terms
of its retention;
 
(F)           in the Lender’s discretion, it determines that Parent is no longer
actively pursuing a Liquidity Transaction;
 
(G)           any Person, other than Lender, shall exercise its rights and
remedies against the Obligors as a result of defaults or events of defaults
arising under any agreement between Obligors and such Person due to
cross-defaults arising from the Existing Events of Default; and
 

 
 

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(H)           Obligors shall have executed an asset purchase agreement in
connection with an Alternate Transaction for the sale of RAI and/or its assets
to a party other than Hawthorne and the Freeholders of Mercer County, New Jersey
shall have formally approved the assignment of that certain lease by and between
Ronson Helicopters, Inc. (now known as RAI), as lessee, and County of Mercer, as
lessor, dated May 14, 1975 (as amended, the “Lease”) to the purchaser identified
in such asset purchase agreement.
 
2.            Funding of RAI Pending Closing of the RAI Sale.  Obligors
acknowledge and agree that as a result of the consummation of the Zippo Sale,
RCPC and Ronson Canada shall no longer be permitted to request Advances under
the Credit Agreement and any remaining assets of RCPC and/or Ronson Canada shall
no longer be considered in any borrowing base calculation.  Notwithstanding the
foregoing, Lender and Obligors agree that RAI shall be authorized, until the
occurrence of a Termination Event, to request Advances subject to the terms of
the Credit Agreement as modified by this Amendment.  Obligors and Lender further
agree that Lender shall have no obligation to make Advances to RAI  after the
occurrence of a Termination Event.
 
3.            Amendments to Credit and Security Agreement.
 
(a)           The following new definitions shall be added to section 1.1 of the
Credit Agreement in the appropriate alphabetical order and shall read as
follows:
 
“Availability Block” shall mean a block on availability under the revolving line
of credit in the amount of the Cole Schotz Payment; provided, however, upon
Lender’s receipt of a properly executed Repayment Agreement, the amount of the
Availability Block shall be reduced to zero.
 
“Cole Schotz Payment” shall mean an amount equal to $224,396.07, representing
the amount of legal fees and expenses billed to Obligors, and due and owing to
Cole, Schotz, Meisel, Forman & Leonard, P.A. (“Cole Schotz”), for the period
through February 28, 2010; provided, however, Obligors acknowledge and agree
that the Cole Schotz Payment shall not be paid until such time as Lender has
received a properly executed Repayment Agreement.
 
“Repayment Agreement” shall mean a Repayment Agreement, acceptable to Lender in
form and substance in its sole discretion, executed by Cole Schotz in favor of
Lender evidencing Cole Schotz’s agreement to repay to Lender the Cole Schotz
Obligations (as such term is defined in the Repayment Agreement) on the terms
and conditions set forth therein.
 
(b)           The following definitions set forth in section 1.1 of the Credit
Agreement shall be amended and restated in their entirety to read as follows:
 
“Accommodation Overadvance Limit” means an amount up to $1,325,000 from the date
of that certain Seventeenth Amendment to Forbearance Agreement through the
occurrence of a Termination Event (as such term is defined in the Forbearance
Agreement).
 

 
 

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“Domestic Borrower Borrowing Base” means at any time the lesser of:
 
(a)           The Maximum Line Amount; or
 
(b)           Subject to change from time to time in the Lender’s sole
discretion, the sum of:
 
(i)           The product of the Accounts Advance Rate times Eligible Accounts
owned by RAI, plus
 
(ii)           The lesser of (A) thirty-six percent (36%), or such lesser rate
as the Lender in its sole discretion may deem appropriate from time to time, of
Eligible Inventory owned by RAI, (b) eighty-five percent (85%), or such lesser
rate as the Lender in its sole discretion may deem appropriate from time to
time, of the Net Orderly Liquidation Value of Eligible Inventory owned by RAI,
or (C) $200,000, less
 
(iii)           The Domestic Borrowing Base Reserve, less
 
(iv)           The Availability Block, less
 
(v)           Indebtedness that the Domestic Borrowers owe to the Lender that
has not yet been advanced on the Revolving Note, and an amount that the Lender
in its reasonable discretion finds on the date of determination to be equal to
the Lender’s net credit exposure with respect to any swap, derivative, foreign
exchange, hedge, deposit, treasury management or other similar transaction or
arrangement extended to the Domestic Borrowers by the Lender that is not
described in Article II of this Agreement  and any indebtedness owed by the
Domestic Borrowers to Wells Fargo Merchant Services, L.L.C.
 
“Maximum Line Amount” means $2,400,000, unless such amount is reduced pursuant
to Section 2.12, in which amount it means such lower amount.”
 
(c)           Section 2.1.1 of the Credit Agreement is amended and restated in
its entirety to read as follows:
 
2.1.1           Accommodation Overadvance.  Notwithstanding anything contained
in Section 2.1 or otherwise in this Agreement to the contrary, the Lender
agrees, subject to the terms and conditions of this Agreement, to make Revolving
Advances to RAI in amounts which may cause the outstanding balance of the
aggregate Revolving Advances to exceed the Availability or which may cause the
outstanding balance of Revolving Advances to exceed the Borrowing Base (any such
excess Revolving Advances are herein referred to collectively as “Accommodation
Overadvances”); provided that the aggregate of any such Accommodation
Overadvances outstanding at any one time shall not exceed the Accommodation
Overadvance Limit.  All Accommodation Overadvances shall constitute Revolving
Advances and in no event shall the total of Revolving Advances exceed the
Maximum Line Amount.  The Accommodation Overadvance shall be exempt from the
provisions of Section 2.13(a) of this Agreement.
 

 
 

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4.            Interest Rate on Accommodation Overadvance.  Obligors acknowledge
and agree that interest on the Accommodation Overadvance shall accrue at a rate
equal to the Prime Rate plus eight percent (8.00%) per annum.
 
5.            Forbearance Fee.  Obligors agree that the portion of paragraph 3
of that certain Seventh Amendment to Forbearance Agreement dated as of July 31,
2009 (the “Seventh Amendment”), which provided that the forbearance fee in the
amount of Five-Hundred Thousand Dollars ($500,000) would not be charged as a
Revolving Advance under the Credit Agreement until the earlier of (a) the
occurrence of a Termination Event or (b) payment of the Indebtedness, is hereby
amended to provide that Lender shall be permitted to charge the forbearance fee
as a Revolving Advance under the Credit Agreement upon execution of this
Amendment.  Obligors agree that (i) $450,000 of the forbearance fee was fully
earned upon execution of the Forbearance Agreement and that (ii) $50,000 of the
forbearance fee was fully earned upon execution of the Seventh Amendment, and
that the forbearance fee constitutes part of the Indebtedness due and owing
under the Credit Agreement.
 
6.            Conditions.  Lender’s agreement to further forbear from exercising
its rights and remedies pursuant to this Agreement is conditioned upon:
 
(a)           execution and delivery by the Obligors and Lender of this
Agreement;
 
(b)           unless otherwise agreed to in writing by the Lender, receipt by
Lender, not later than May 11, 2010, of evidence that Obligors have engaged an
investment banking firm to market RAI and/or its assets on the terms and
conditions set forth below;
 
(c)           receipt by Lender, not later than June 5, 2010, of evidence that
Obligors have executed an asset purchase agreement for an Alternate Transaction,
which Lender determines in its reasonable discretion provides sufficient
proceeds to repay and satisfy in full all Indebtedness due and owing to Lender
by Obligors;

(d)           receipt by Lender, not later than June 10, 2010, of evidence that
the Freeholders of Mercer County, New Jersey have given their consent to
assignment of the Lease to the proposed purchaser in connection with an
Alternate Transaction; and

(e)           such other matters as Lender may reasonably require.
 
7.            Engagement of Investment Banking Firm.  Unless otherwise agreed to
in writing by the Lender, Obligors shall deliver to Lender evidence establishing
that the Obligors have engaged an investment banking firm, including, without
limitation, copies of any engagement letter executed by the Obligors with such
investment banking firm, which engagement letter shall be in form and substance
reasonably acceptable to Lender.  The investment banking firm shall be selected
by Obligors and reasonably acceptable to Lender.  At all times during the term
of the Forbearance Agreement, Obligors will continue to employ the investment
banking firm for the purposes described in the engagement letter, including for
the purpose of marketing and selling RAI and/or its assets.  Obligors consent to
Lender having reasonable access to the investment
 

 
 

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banking firm and Obligors hereby agree and consent to Lender meeting with the
investment banking firm without Obligors present and Obligors hereby release
and, absent bad faith, willful misconduct, gross negligence or fraud, agree to
hold the investment banking firm and Lender harmless from any information or
discussions held between the investment banking firm and Lender.
 
8.            Sums Secured; Estoppel.  The Obligors acknowledge and reaffirm
that their obligations to Lender as set forth in and evidenced by the Loan
Documents 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 as of the
date hereof, the Obligors waive and release Lender from the same.
 
9.            No Other Changes. Except as explicitly amended by this Amendment,
all of the terms and conditions of the Forbearance Agreement shall remain in
full force and effect.
 
10.            References.  All references in the Forbearance Agreement to “this
Agreement” shall be deemed to refer to the Forbearance Agreement as amended
hereby.
 
11.            No Waiver. Except as specifically set forth in Paragraph 1 above,
the execution of this Amendment shall not be deemed to be a waiver of any
Default or Event of Default under the Credit Agreement, a waiver of any
Termination Event under the Forbearance Agreement or breach, default or event of
default under any Loan Documents or other document held by Lender, whether or
not known to Lender and whether or not existing on the date of this Amendment.
 
12.            Waiver and Release of Claims and Defenses.  The Obligors hereby
waive and release all claims and demands of any nature whatsoever that they now
have or may have against Lender, whether arising under the Loan Documents or by
any acts or omissions of Lender, or any of its directors, officers, employees,
affiliates, attorneys or agents, or otherwise, and whether known or unknown,
existing as of the date of the execution of this Amendment, and further waive
and release any and all defenses of any nature whatsoever to the payment of the
Obligations or the performance of their obligations under Loan Documents.
 
13.            Reaffirmation of Loan Documents.  The Obligors hereby agree with,
reaffirm and acknowledge their representations and warranties contained in the
Loan Documents.  Furthermore, the Obligors represent that their representations
and warranties contained in the Loan Documents continue to be true and in full
force and effect.  This agreement, reaffirmation and acknowledgment is given to
Lender by the Obligors without defenses, claims or counterclaims of any
kind.  To the extent that any such defenses, claims or counterclaims against
Lender may exist, the Obligors waive and release Lender from same.
 
14.            Ratification and Reaffirmation of Loan Documents.  The Obligors
ratify and reaffirm all terms, covenants, conditions and agreements contained in
the Loan Documents.
 
15.            No Preferential Treatment.  No Obligor has entered into this
Amendment to provide any preferential treatment to Lender or any other
creditor.  No Obligor intends to file for protection or seek relief under the
United States Bankruptcy Code or any similar federal or state law providing for
the relief of debtors.
 

 
 

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16.            Legal Representation.  Each of the parties hereto acknowledge
that they have been represented by independent legal counsel in connection with
the execution of this Amendment, that they are fully aware of the terms and
conditions contained herein, and that they have entered into and executed the
within Amendment as a voluntary action and without coercion or duress of any
kind.
 
17.            Partial Invalidity; No Repudiation. If any of the provisions of
this Amendment shall contravene or be held invalid under the laws of any
jurisdiction, this Amendment shall be construed as if not containing such
provisions and the rights, remedies, warranties, representations, covenants, and
provisions hereof shall be construed and enforced accordingly in such
jurisdiction and shall not in any manner affect such provision in any other
jurisdiction, or any other provisions of this Amendment in any jurisdiction.
 
18.            Binding Effect.  This Amendment is binding upon the parties
hereto and their respective heirs, administrators, executors, officers,
directors, representatives and agents.
 
19.            Governing Law.  This Amendment shall be governed by the laws of
the State of New York.
 
20.            WAIVER OF JURY TRIAL.  EACH OF THE PARTIES HERETO WAIVE THE RIGHT
TO A TRIAL BY JURY, AS TO ANY ACTION WHICH MAY ARISE AS A RESULT OF THE LOAN
DOCUMENTS, THE FORBEARANCE AGREEMENT, THIS AMENDMENT OR ANY DOCUMENT EXECUTED IN
CONNECTION HEREWITH.
 
21.            Counterparts.  This Amendment and/or any documentation
contemplated or required in connection herewith may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
be considered one and the same document.  Delivery of an executed counterpart of
a signature page of this document by facsimile shall be effective as delivery of
a manually executed counterpart of this document.
 
[Signature pages follow]
 

 
 

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IN WITNESS WHEREOF, the parties hereto, intending to be legally bound hereby, do
hereby execute this Amendment the date and year first above written.
 
RCLC, INC. (f/k/a RONSON CORPORATION)
 
By:  /s/ Joel Getzler                                              
Print Name: Joel Getzler
Print Title: Chief Restructuring Officer
 
RCPC LIQUIDATING CORP. (f/k/a/ RONSON
CONSUMER PRODUCTS CORPORATION)
 
By:  /s/ Joel Getzler                                              
Print Name: Joel Getzler
Print Title: Chief Restructuring Officer
 
RONSON AVIATION, INC.
 
By:  /s/ Joel Getzler                                              
Print Name: Joel Getzler
Print Title: Chief Restructuring Officer
 
RCC INC. (f/k/a RONSON CORPORATION OF CANADA LTD.)
 
By:  /s/ Joel Getzler                                              
Print Name: Joel Getzler
Print Title: Chief Restructuring Officer

 
 

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WELLS FARGO BANK, NATIONAL ASSOCIATION
 
By:/s/ Peter
Gannon                                                                                                        
Peter Gannon, Vice President

 
 

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