December 20, 2002
BEI TECHNOLOGIES, INC.
BEI SENSORS & SYSTEMS COMPANY, INC.
c/o BEI Technologies, Inc.
Xxx Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx/Xxxx Xxxxxxx
Re: Second Amendment to Note Purchase Agreement and Waiver
Gentlemen:
Reference is made to the Note Purchase Agreement dated as of November
16, 1998, as amended by that certain Amendment to Note Purchase Agreement dated
March 30, 2002 (as further amended from time to time, the "Note Purchase
Agreement") between BEI Technologies, Inc., a Delaware corporation (the
"Company") and BEI Sensors & Systems Company, Inc., a Delaware corporation
("Systems"; together with the Company, the "Co-Obligors"), on the one hand, and
each purchaser named on Schedule A attached to the Note Purchase Agreement, on
the other hand.
Capitalized terms used herein without definition have the meanings
ascribed to such terms in Schedule B of the Note Purchase Agreement.
The Co-Obligors have requested that the Note holders amend the Note
Purchase Agreement and waive certain provisions thereof, subject to the
conditions and in reliance of the representations and warranties set forth
herein.
In consideration of the foregoing recitals, the parties hereto agree as
follows:
1. Amendment to the Note Purchase Agreement. Pursuant to Section 17.1
thereof, the Note Purchase Agreement is amended as follows:
(a) Section 10.5 of the Note Purchase Agreement is amended by
adding the following proviso at the end thereof:
":provided, further, for the period ending December 28, 2002,
the Company will not permit the ratio of Earnings Available for Fixed
Charges to Fixed Charges for the period comprised of the immediately
preceding four fiscal quarters of the Company to be less than 0.75 to
1.00."
2. Waiver of Covenant Violation. Co-Obligors' violation of Section 10.5
of the Note Purchase Agreement for the period ending September 28, 2002 is
hereby waived.
3. Representations and Warranties. Each Co-Obligor hereby certifies
that as of the date hereof the representations and warranties of such Co-Obligor
contained in Section 5 of the Note Purchase Agreement are true and correct in
all material respects as though made on and as of such date (except to the
extent such specifically relate to another date).
4. Condition to Effectiveness. The effectiveness of this letter
agreement is subject to the receipt of a fully executed counterpart of this
letter agreement by the Co-Obligors and Required Holders.
5. No Waiver. Each amendment and waiver set forth in this letter
agreement shall be limited precisely as written and shall not be deemed to be
(a) an amendment, consent or waiver of any other terms or conditions of the Note
Purchase Agreement or any other document related to the Note Purchase Agreement,
(b) a waiver, other than as set forth in paragraph 2 hereof, of any right or
remedy of the holders of the Notes issued under the Note Purchase Agreement or
(c) a consent to any future amendment, consent or waiver of the Note Purchase
Agreement or any future transaction, event or condition which would constitute a
Default or Event of Default under the Note Purchase Agreement. Except as
expressly set forth in this letter agreement, the Note Purchase Agreement and
all related documents shall continue in full force and effect.
[Remainder of page intentionally left blank.]
If you are in agreement with the foregoing, please sign the form of
acceptance on the enclosed counterparts of this letter agreement, whereupon,
subject to satisfaction of the condition set forth in paragraph 4 above, this
letter agreement will become a binding agreement among the Co-Obligors and the
Note holders as of the date first written above.
Very truly yours,
CONNECTICUT GENERAL LIFE INSURANCE COMPANY,
By CIGNA Investments, Inc.
By: /s/ Xxxx X Xxxxxx
-----------------------------------------
Name: XXXX X XXXXXX
-----------------------------------
Title: VICE PRESIDENT
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CONNECTICUT GENERAL LIFE
INSURANCE COMPANY,
on behalf of one or more separate accounts
By CIGNA Investments, Inc.
By: /s/ Xxxx X Xxxxxx
----------------------------------------
Name: XXXX X XXXXXX
-----------------------------------
Title: VICE PRESIDENT
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ALLSTATE LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X Xxxxx
----------------------------------------
Name: XXXXXX X XXXXX
-----------------------------------
Title: AUTHORIZED SIGNATORY
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By: /s/ Xxxxxxxx X. Xxxxxx
----------------------------------------
Name: XXXXXXXX X. XXXXXX
-----------------------------------
Title: AUTHORIZED SIGNATORY
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The foregoing letter agreement is hereby accepted as of the date first above
written.
BEI TECHNOLOGIES, INC.
By: /s/ Xxxx Xxxxxxxx
----------------------------------------
Name: Xxxx Xxxxxxxx
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Title: Senior Vice President and
Chief Financial Officer
--------------------------------
By: /s/ Xxxxxx X. Xxxx
----------------------------------------
Name: Xxxxxx X. Xxxx
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Title: Vice President, Secretary,
---------------------------------
Treasurer and Controller
BEI SENSORS & SYSTEMS COMPANY, INC.
By: /s/ Xxxx Xxxxxxxx
----------------------------------------
Name: Xxxx Xxxxxxxx
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Title: Chief Financial Officer
---------------------------------
By: /s/Xxxxxx X. Xxxx
----------------------------------------
Name: Xxxxxx X. Xxxx
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Title: Secretary, Treasurer
and Controller
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