April 20, 2000
REMEC, INC.
9404 Chesapeake Drive
San Diego, California 92123
Attention: Mike McDonald
Chief Financial Officer
Re: REMEC Inc. Trust 1998 A - Waiver and Fourth Amendment
("Amendment") to the Participation Agreement, dated as of
August 25, 1998, (the "Participation Agreement").
Dear Mike:
This Waiver and Fourth Amendment to Participation Agreement (this
"Fourth Amendment"), dated as of April 20, 2000, is entered into among REMEC
Inc., a California corporation, as Lessee; Union Bank of California, N.A. not in
its individual capacity except as expressly stated herein but solely as
Certificate Trustee; the Persons named on Schedule 1-A of the Participation
Agreement (together with their respective permitted successors, assigns and
transferees), as Certificate Purchasers; the Persons listed on Schedule 1-B of
the Participation Agreement (together with their respective permitted
successors, assigns and transferees), as Lenders; and Union Bank of California,
N.A. as Agent.
WITNESSETH:
WHEREAS, Lessee, Lessor, Agent, the Certificate Purchasers and the
Lenders have entered into that certain Participation Agreement, dated as of
August 25, 1998 (as amended by those certain First, Second and Third Amendments
to Participation Agreement, dated as of September 29, 1998, September 21, 1999
and February 24, 2000, respectively, the ("Participation Agreement")
(capitalized terms used herein without definition shall have the same meanings
ascribed to them in Appendix 1 to the Participation Agreement, except as
modified pursuant to Section 2 below); and
WHEREAS, the parties hereto desire to enter into this Amendment in
order to amend the Participation Agreement with respect to the matters provided
in this Amendment.
NOW, THEREFORE, in consideration of the foregoing premises, the mutual
terms and conditions herein contained, and for other good and valuable
consideration the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
Section 1. WAIVER. Lessor, Agent and each of the Participants hereby
waive for the fiscal quarter of Lessee ending January 31, 2000, and only for
such fiscal quarter, compliance with the Funded Debt to EBITDA ration
requirement set forth in Section 5.11 of the Participation Agreement, and
agree that such noncompliance shall not constitute a
Lease Default or a Lease Event of Default. The waiver here given is specific
to the covenant, and for the fiscal quarter of Lessee, referred to above and
shall not operate as a waiver of compliance by Lessee with any other
covenants set forth in the Participation Agreement, or with the covenant set
forth above for any other fiscal quarter of Lessee.
Section 2. MODIFICATION TO PARTICIPATION AGREEMENT. The parties hereto
amend the Participation Agreement as follows and all references to the words
"Participation Agreement" shall hereinafter refer to the Participation
Agreement as amended by this Section 2.
2.1 Section 5.23 of the Participation Agreement is amended and
restated in is entirety to read as follows:
Section 5.23 PROFITABILITY. Lessee will not incur a net loss for any
fiscal year (commencing with the fiscal year of Lessee ending January
31, 2001).
Section 3. REPRESENTATION AND WARRANTIES. Lessee represents and
warrants to each of the other parties hereto that each of the
representations and warranties of Lessee contained the Participation
Agreement and in each other Operative Document is true and correct in all
material respects on the date hereof, with the same effect as though made on
and as of such date and, for purposes of this paragraph, all references in
such representations and warranties to the "Operative Documents" shall be
deemed to include this Amendment.
Section 4. EFFECTIVENESS. Subject to the execution and delivery of this
Amendment by all parties hereto, this Amendment is entered into as of the
date set forth in the preamble to this Amendment, but effective, however, as
of April 20, 2000 (the "EFFECTIVE DATE").
Section 5. APPLICABLE LAW. THIS AMENDMENT HAS BEEN DELIVERED IN, AND
SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF, THE STATE OF CALIFORNIA, WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES OF SUCH STATE.
Section 6. COUNTERPARTS. This Amendment may be executed in any number
of counterparts and by different parties hereto on separate counterparts,
each executed counterpart constituting an original but all together one
agreement.
Section 7. DIRECTION TO TRUSTEE. By signing this Amendment, the
Participants authorize and direct Union Bank of California, N.A., as
Certificate Trustee, and Union Bank of California, N.A., as Agent, to sign
this Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed and delivered as of the date first above written.
Lessee: REMEC, INC., a California corporation,
as Lessee
By: /s/ Michael McDonald
-------------------------------------
Name Printed: Michael McDonald
Title: Chief Financial Officer
Certificate Trustee: UNION BANK OF CALIFORNIA, N.A.,
not in its capacity except as expressly
stated herein, but solely as Certificate
Trustee
By: /s/ Andrew R. Ball
-------------------------------------
Name Printed: Andrew R. Ball
Title: Vice President
Agent: UNION BANK OF CALIFORNIA, N.A.,
not in its individual capacity except as
expressly stated herein, but solely as
Certificate Trustee
By: /s/ Rick Young
-------------------------------------
Name Printed: Rick Young
Title: Vice President
Certificate Purchaser: BANKERS COMMERCIAL CORPORATION, as
Certificate Purchaser
By: /s/ Lance B. Markowitz
-------------------------------------
Name Printed: Lance B. Markowitz
Title: President
Lender: UNION BANK OF CALIFORNIA, N.A.,
not in its individual capacity except as
expressly stated herein, but solely as
Lender
By: /s/ Rick Young
-------------------------------------
Name Printed: Rick Young
Title: Vice President