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As filed with the Securities and Exchange Commission on July 3, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
REMEC, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
CALIFORNIA 3812 95-3814301
(State or Other Jurisdiction (Primary Standard Industrial (I.R.S. Employer
of Incorporation or organization) Classified Code Number) Identification No.)
</TABLE>
9404 CHESAPEAKE DRIVE, SAN DIEGO, CALIFORNIA 92123, (619) 560-1301
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
RONALD E. RAGLAND, CHAIRMAN AND CHIEF EXECUTIVE OFFICER
9404 CHESAPEAKE DRIVE, SAN DIEGO, CALIFORNIA 92123, (619) 560-1301
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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COPIES TO:
Victor A. Hebert
Paul H. Greiner
Heller Ehrman White & McAuliffe
601 South Figueroa Street
Los Angeles, California 90017-5758
(213) 689-0200
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed maximum
aggregate Proposed maximum
offering aggregate Amount of
Title of each class of securities Amount to be price per offering registration
to be registered registered share(1) price(1) fee
<S> <C> <C> <C> <C>
Common Stock, par value $0.01 per share 138,000 $22.25 $3,070,500 $931
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933 based upon
the average of the high and low prices of the Registrant's Common
Stock on July 1, 1997, as reported on the Nasdaq National Market.
_______________
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
SUBJECT TO COMPLETION, DATED JULY ___, 1997
PROSPECTUS
138,000 Shares
REMEC
Common Stock
---------------
This Prospectus relates to the public offering, which is not being
underwritten, of up to 138,000 shares of Common Stock (the "Shares") of REMEC,
Inc. ("REMEC" or the "Company"), which may be offered from time to time by any
or all of the shareholders of the Company named herein (the "Selling
Shareholders"). The Company will receive no part of the proceeds of such
sales. All of the Shares were originally issued by the Company in connection
with the Company's acquisition of Verified Technical Corporation ("Veritek"),
by and through a merger of a newly formed subsidiary of REMEC ("Acquisition
Sub") with and into Veritek (the "Veritek Merger"). The Shares were issued
pursuant to an exemption from the registration requirements of the Securities
Act of 1933, as amended (the "Securities Act"), provided by Section 4(2)
thereof and reflect a 50% stock dividend payable on June 27, 1997 to
shareholders of record as of June 20, 1997. The Shares are being registered by
the Company pursuant to the Agreement and Plan of Reorganization and Merger
dated March 31, 1997 (the "Reorganization Agreement"), by and among REMEC,
Acquisition Sub and Veritek.
The Shares may be offered by the Selling Shareholders from time to time in
one or more transactions in the over-the-counter market at prices prevailing
therein, in negotiated transactions at such prices as may be agreed upon, or in
a combination of such methods of sale. See "Plan of Distribution." The price
at which any of the Shares may be sold, and the commissions, if any, paid in
connection with any such sale, are unknown and may vary from transaction to
transaction. The Company will pay all expenses incident to the offering and
sale of the Shares to the public other than any commissions and discounts of
underwriters, dealers or agents and any transfer taxes. See "Selling
Shareholders" and "Plan of Distribution."
The Company's Common Stock is listed on the Nasdaq National Market under
the symbol "REMC." On July 2, 1997, the last reported sale price of the
Company's Common Stock on the Nasdaq National Market was $22.50 per share.
---------------
SEE "RISK FACTORS" BEGINNING ON PAGE 3 FOR CERTAIN INFORMATION WHICH
SHOULD BE CAREFULLY CONSIDERED BEFORE PURCHASING SHARES OF COMMON STOCK OFFERED
HEREBY.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 1997
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy and information statements and other
information with the Commission. Such reports, proxy and information
statements and other information may be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, Judiciary
Plaza, 450 Fifth Street, NW, Washington, D.C. 20549, and at the following
Regional Offices of the Commission: New York Regional Office, Seven World Trade
Center, Suite 1300, New York, New York 10048 and Chicago Regional Office,
Northwest Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. Copies of such material may be obtained by mail at prescribed rates
from the Public Reference Section of the Commission at Judiciary Plaza, 450
Fifth Street, NW, Washington, D.C. 20549. The Commission maintains a Web site
that contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission. The
address of the site is http://www.sec.gov. The Common Stock of the Company is
listed on the Nasdaq National Market, and such reports, proxy and information
statements and other information concerning the Company may be inspected at the
offices of Nasdaq Operations, 1735 K Street, NW, Washington, D.C. 20006.
This Prospectus constitutes a part of a Registration Statement on Form
S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") filed by the Company with the Commission under the
Securities Act. This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information with respect to the Company and the shares of Common Stock offered
hereby, reference is hereby made to the Registration Statement. The
Registration Statement may be inspected at the public reference facilities
maintained by the Commission at the addresses set forth in the preceding
paragraph. Statements contained herein concerning any document filed as an
exhibit are not necessarily complete and, in each instance, reference is made
to the copy of such document filed as an exhibit to the Registration Statement.
Each such statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the
Company (File No. 0-027414) pursuant to the Exchange Act are hereby
incorporated by reference in this Prospectus:
(1) The Company's Annual Report on Form 10-K for the year ended
January 31, 1997 and the amendment thereto on Form 10-K/A;
(2) The Company's Quarterly Report on Form 10-Q for the quarter
ended May 4, 1997; and
(3) The description of the Company's Common Stock contained in its
Registration Statement on Form 8-A, filed with the Commission
on December 13, 1995.
Any statement contained in a document incorporated by reference into
this Prospectus shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document that also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
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The Company hereby undertakes to provide without charge to each
person, including any beneficial owner, to whom a copy of this Prospectus has
been delivered, upon written or oral request of such person, a copy of any or
all of the foregoing documents incorporated by reference into this Prospectus
(other than exhibits to such documents, unless such exhibits are specifically
incorporated by reference into such documents). Requests for such documents
should be submitted in writing to Investor Relations, REMEC, Inc., 9404
Chesapeake Drive, San Diego, California 92123, (619) 560-1301.
FORWARD LOOKING STATEMENTS
The statements in this Prospectus and the documents incorporated
herein by reference that relate to future plans, events or performance are
forward-looking statements. The Company's future operations, financial
performance, business and share price may be affected by a number of factors,
including the factors listed below, any of which could cause actual results to
vary materially from anticipated results. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date hereof. The Company undertakes no obligation, other than as required
under the Securities Act or the Exchange Act, to publicly release the result of
any revisions to these forward-looking statements that may be made to reflect
events or circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
RISK FACTORS
DEPENDENCE ON COMMERCIAL WIRELESS TELECOMMUNICATIONS MARKET
Until recently, the Company's business has been almost exclusively
focused on the defense market. The Company believes that its future growth
depends on continued success in the commercial wireless telecommunications
market. The Company believes that, while the technologies used in the defense
and commercial industries are very similar, the two industries differ
significantly in terms of the customer base, manufacturing requirements and
lead times, the need to expend substantial resources for research and
development without the assurance of reimbursement or recovery of those costs,
and credit risks with customers. As a result, the Company is subject to risks
inherent in the operation of a new business enterprise, including risks
associated with attracting and servicing a new customer base, manufacturing
products in a cost effective and profitable manner, managing the expansion of a
business operation and attracting and retaining qualified engineering,
manufacturing and marketing personnel with industry experience. For example,
the Company believes that microwave engineers with the skills necessary to
develop products for the wireless telecommunications market currently are in
high demand and that the Company may not be able to attract and retain
sufficient engineering expertise.
A number of the commercial markets for the Company's products in the
wireless telecommunications area have only recently begun to develop. Because
these markets are relatively new, it is difficult to predict the rate at which
these markets will grow, if at all. Existing or potential wireless
telecommunications market applications for the Company's products may fail to
develop or may erode for many different reasons, including insufficient growth
to support expensive infrastructure equipment, insufficient consumer demand for
wireless products or services because of pricing or otherwise, or real or
perceived security risks associated with wireless communications. If the
markets for the Company's products in commercial wireless telecommunications
fail to grow, or grow more slowly than anticipated, the Company's business,
operating results and financial condition could be materially adversely
affected.
DEPENDENCE ON DEFENSE MARKET
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A substantial portion of the Company's sales has been to the defense
market. As a result, the Company's sales could be materially adversely
impacted by a decrease in defense spending by the United States government
because of defense spending cuts, general budgetary constraints or otherwise.
The United States defense budget has recently been reduced and may be further
reduced. Fewer available defense industry production programs, coupled with
continued pricing pressure on follow-on orders for programs on which the
Company participates, caused sales of the Company's core defense products --
MFMs and components for microwave systems -- to decline from $35.3 million in
the year ended January 31, 1994 to $27.5 million for the year ended January 31,
1997. The Company expects to continue to derive a substantial portion of its
revenues from these business segments and to develop microwave products for
defense applications. Failure of the Company to replace sales attributable to
a significant defense program or contract at the end of that program or
contract, whether due to cancellation, spending cuts, budgetary constraints or
otherwise, could have a material adverse effect upon the Company's business,
operating results and financial condition in subsequent periods. In addition,
a large portion of the Company's expenses are fixed and difficult to reduce,
thus magnifying the material adverse effect of any revenue shortfall. Also,
defense contracts frequently contain provisions that are not standard in
private commercial transactions, such as provisions permitting the cancellation
of a contract if funding for a program is reduced or canceled. For example,
the government terminated a large defense program in December 1992 for which
the Company had been supplying in excess of $4.0 million of products on an
annual basis. See "Management's Discussion and Analysis of Financial Condition
and Results of Operations."
CUSTOMER CONCENTRATION AND EXCLUSIVITY
As of May 4, 1997, two customers, P-COM, Inc. ("P-COM") and STM
Wireless, Inc. ("STM"), accounted for a substantial portion of total backlog.
P-COM, which produces point-to-point millimeter wave radio systems for use in
wireless telecommunications applications, was founded in August 1991 and began
commercial shipment of its products in October 1993. P-COM experiences intense
competition worldwide from a number of leading telecommunications companies,
most of which have substantially greater installed bases, financial resources
and other capabilities than P-COM, and is subject to the risks inherent in the
operation of a new business enterprise. The sales agreement between the
Company and P-COM provides that all of the units will be delivered by December
1998. REMEC has agreed to sell the products which are the subject of the
agreement with P-COM exclusively to P-COM and not to compete with P-COM in the
sale of point-to-point radios under conditions applicable to both parties. In
1996, REMEC received orders from STM for $30.4 million for the design and
manufacture of C-Band VSAT equipment. STM experiences intense competition
worldwide from a number of leading telecommunications companies, most of which
have substantially greater installed bases, financial resources and other
capabilities than STM. Aside from P-COM and STM, the Company derives
significant revenues from a limited group of customers, including Department of
Defense, Hughes Aircraft Co., Texas Instruments Inc., Lockheed Martin
Corporation ("Lockheed Martin"), Northrop Grumman Corporation, GEC Marconi
Aerospace, Inc., TRW Inc., Motorola, Inc., Alcatel Network Systems, and Farinon
Division of Harris Corporation ("Harris-Farinon"). The Company anticipates
that it will continue to sell products to a relatively small group of
customers. As a result, any cancellation, reduction or delay in orders by or
shipments to P-COM, STM or any other significant customer, as a result of
manufacturing or supply difficulties or otherwise, or the inability of any
customer to finance its purchases of the Company's products would materially
adversely affect the Company's business, financial condition and operating
results. The Company has granted P-COM and STM exclusivity for certain
products and expects that in order to enter into other significant
relationships in the wireless telecommunications industry, customers will
either expressly or implicitly require exclusivity. In entering into such
exclusive arrangements, the Company will have to forego opportunities to supply
products to competing companies. If the Company enters into exclusive
relationships with customers who prove to be unsuccessful, the business,
financial condition and operating results of the Company may be materially
adversely affected and the Company may be unable then to establish
relationships with the industry leaders. There can be no assurance
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that the Company will be able to locate, or negotiate acceptable arrangements
with, significant customers or that its current or future arrangements with
significant customers will continue or will be successful.
INTEGRATION OF ACQUISITIONS
In August 1996, the Company completed a merger (the "Magnum Merger")
of a newly formed subsidiary of REMEC into Magnum Microwave Corporation
("Magnum"). The anticipated benefits of the Magnum Merger will not be achieved
unless the Company and Magnum are successfully combined in an efficient and
effective manner. The transition to a combined Company in which Magnum is a
wholly owned subsidiary of the Company will require substantial attention from
management, which has limited experience in integrating companies the size of
REMEC and Magnum. In addition, the Company recently acquired RF Microsystems,
Inc. ("RF Microsystems"), Radian, Veritek and has entered into an agreement to
acquire C&S Hybrid, Inc. ("C&S Hybrid"). The collective integration of RF
Microsystems, Radian, Veritek and C&S Hybrid also will require substantial
attention from management. The diversion of management attention and any
difficulties encountered in the integration of RF Microsystems, Radian, Magnum,
Veritek and C&S Hybrid as a group could have an adverse impact on the business
and operating results of the Company. There can be no assurance that Magnum,
Radian, RF Microsystems, Veritek or C&S Hybrid will be successfully integrated
or that the consolidated operations of REMEC and its subsidiaries will be
profitable. The Company will face similar risks in the integration of any
future acquisitions.
MANAGEMENT OF GROWTH
The growth in size and complexity of the Company's business and
expansion of its product lines and customer base have placed, and are expected
to continue to place, significant demands on the Company's management and
operations. The Company's ability to compete effectively and to manage future
growth will depend on its ability to continue to implement and improve
operational and financial systems on a timely basis. There can be no assurance
that the Company will be able to manage its future growth, and the failure to
do so could have a material adverse effect on the Company's business, financial
condition and operating results.
FLUCTUATIONS IN QUARTERLY RESULTS
The Company's quarterly results have in the past been, and will
continue to be, subject to significant variations due to a number of factors,
any one of which could substantially affect the Company's results of operations
for any particular fiscal quarter. In particular, quarterly results of
operations can vary due to the timing, cancellation or rescheduling of customer
orders and shipments, the pricing and mix of products sold, new product
introductions by the Company, the Company's ability to obtain components and
subassemblies from contract manufacturers and suppliers, and variations in
manufacturing efficiencies. In addition, with the decline in available defense
industry production programs, the Company has placed more reliance on
development contracts as a source of defense revenues, resulting in an
increased susceptibility to fluctuations due to an increase in revenues from
fixed price development contracts as a percentage of total revenues.
Development contracts carry reduced gross margins and are typically for minimal
hardware deliveries and sporadic non-hardware revenue items which results in
fluctuating sales and gross margins. Accordingly, the Company's performance in
any one fiscal quarter is not necessarily indicative of financial trends or
future performance.
BACKLOG
The Company's order backlog is subject to fluctuations and is not
necessarily indicative of future sales. There can be no assurance that current
order backlog will necessarily lead to sales in any future period. The
Company's order backlog as of May 4, 1997 was approximately $131.1 million,
approximately
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46% of which was attributable to commercial customers and approximately 54% of
which was attributable to defense customers. A substantial amount of the
Company's order backlog can be canceled at any time without penalty, except, in
some cases, the recovery of the Company's actual committed costs and profit on
work performed up to the date of cancellation. Cancellations of pending
purchase orders or termination or reductions of purchase orders in progress
from customers of the Company could have a material adverse effect on the
Company's business, operating results and financial condition.
RISKS OF COST OVERRUNS AND PRODUCT NON-PERFORMANCE; LOSS OF INVESTMENT IN
DESIGN AND ENGINEERING
The Company's customers establish demanding specifications for product
performance, reliability and cost. The Company's contract with P-COM to
produce microwave front ends for point-to-point radios and its contract with
STM to produce C-Band VSAT equipment, and a significant portion of the
Company's defense contracts are firm fixed-price ("FFP") contracts that provide
for a predetermined fixed price for stipulated products, regardless of the
costs incurred. The Company has made pricing commitments to P-COM and STM and
to other customers in anticipation of achieving more cost effective product
designs and introducing more widespread manufacturing automation. A
substantial portion of the P-COM backlog involves the re-design by the Company
of a substantial portion of the point-to-point radio front end. The Company
faces the risk of experiencing cost overruns or order cancellation if it fails
to achieve forecasted product design and manufacturing efficiencies or if
products cost more to produce because of increased cost of materials,
components or labor or otherwise. Manufacture of the Company's products is an
extremely complex process. The Company has in the past experienced cost
overruns on FFP contracts. There can be no assurance that cost overruns or
problems with performance or reliability of Company products will not occur in
the future. Any such cost overruns or performance problems may have a material
adverse effect on the Company's business, operating results and financial
condition. In addition, the Company often makes significant investments in
design and engineering of new products for customers without any commitment by
the customer for the future purchase of such products. Failure to receive
initial or follow-on orders may have a material adverse effect on the Company's
operating results.
NECESSITY OF IMPLEMENTING HIGH VOLUME MANUFACTURING
Historically, the volume of the Company's production requirements in
the defense market was not sufficient to justify the widespread implementation
of automated manufacturing processes. Fulfillment of substantial orders in the
wireless telecommunications industry will require a significant increase in the
Company's manufacturing capacity. For example, the Company is introducing more
automated manufacturing processes in order to fulfill its obligations to P-COM,
some of which are specialized processes that must be developed. There can be
no assurance that the Company will be able to implement the desired automated
manufacturing processes on a timely basis or at all or that, if implemented,
such manufacturing processes will be sufficient to fulfill the Company's
current and future production commitments in a cost effective manner or that
the Company will obtain a sufficient amount of high volume orders to absorb the
capital costs incurred.
COMPETITION
The markets for the Company's products are extremely competitive and
are characterized by technological change, new product development, product
obsolescence and evolving industry standards. In addition, price competition
is intense and significant price erosion generally occurs over the life of a
product. The Company faces some competition from component manufacturers which
have integration capabilities, but believes that its primary competition is
from the captive manufacturing operations of large wireless telecommunications
OEMs (including all of the major telecommunications equipment providers) and
defense prime contractors which are responsible for a substantial majority of
the present worldwide production of MFMs. The Company's future success is
dependent upon the extent to which these OEMs and defense prime
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contractors elect to purchase from outside sources rather than manufacture
their own microwave MFMs and components. The Company's customers and large
manufacturers of microwave transmission equipment could also elect to enter
into the non-captive market for microwave products and compete directly with
the Company. Many of the Company's current and potential competitors have
substantially greater technical, financial, marketing, distribution and other
resources than the Company and have greater name recognition and market
acceptance of their products and technologies. No assurance can be given that
the Company's competitors will not develop new technologies or enhancements to
existing products or introduce new products that will offer superior price or
performance features or that new products or technologies will not render
obsolete the products of the Company's customers. For example, Magnum
experienced a $2.3 million reduction in cavity oscillator shipments in its 1996
fiscal year to Harris-Farinon due to obsolescence. In addition, innovations
such as a wireless telephone system utilizing satellites instead of terrestrial
base stations or a device that integrates microwave functionality could
significantly reduce the potential market for the Company's products. The
Company believes that to remain competitive in the future it will need to
invest significant financial resources in research and development.
DECLINING AVERAGE SELLING PRICES
Many of the Company's customers are under continuous pressure to
reduce prices and, therefore, the Company expects to continue to experience
downward pricing pressure on its products. The Company's customers frequently
negotiate supply arrangements well in advance of delivery dates, requiring the
Company to commit to price reductions before it is determined that assumed cost
reductions can be achieved. To offset declining average sales prices, the
Company believes that it must achieve manufacturing cost reductions and obtain
orders for higher volume products. If the Company is unable to offset
declining average selling prices, the Company's gross margins will decline, and
such decline will have a material adverse effect on the Company's business,
financial condition and operating results.
ENVIRONMENTAL REGULATIONS AND RISKS
The Company is subject to a variety of local, state and federal
governmental regulations relating to the storage, discharge, handling,
emission, generation, manufacture and disposal of toxic or other hazardous
substances used to manufacture the Company's products. The failure to comply
with current or future regulations could result in the imposition of
substantial fines on the Company, suspension of production, alteration of its
manufacturing processes or cessation of operations.
News reports have asserted that power levels associated with hand held
cellular telephones and infrastructure equipment may pose certain health risks.
If it were determined or perceived that electromagnetic waves carried through
wireless telecommunications equipment create a significant health risk, the
market for these products could be materially adversely affected, which could
have a material adverse effect on the Company's business, financial condition
and results of operations. Moreover, if wireless telecommunications systems or
other systems or devices that rely on or incorporate the Company's products are
determined or alleged to create a significant health risk, the Company could be
named as a defendant, and held liable, in product liability lawsuits commenced
by individuals alleging that the Company's products harmed them, which could
have a material adverse effect on the Company's business, financial condition
and results of operations.
GOVERNMENT REGULATIONS
The Company's products are incorporated into wireless
telecommunications systems that are subject to regulation domestically by the
Federal Communications Commission ("FCC") and internationally by other
government agencies. Although the equipment operators and not the Company are
responsible for compliance with such regulations, regulatory changes, including
changes in the allocation of available frequency spectra,
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could materially adversely affect the Company's operations by restricting
development efforts by the Company's customers, obsoleting current products or
increasing the opportunity for additional competition. Changes in, or the
failure by the Company to manufacture products in compliance with, applicable
domestic and international regulations could have a material adverse effect on
the Company's business, financial condition and operating results. In
addition, the increasing demand for wireless telecommunications has exerted
pressure on regulatory bodies worldwide to adopt new standards for such
products, generally following extensive investigation of and deliberation over
competing technologies. The delays inherent in this governmental approval
process have in the past caused and may in the future cause the cancellation,
postponement or rescheduling of the installation of communications systems by
the Company's customers, which in turn may have a material adverse effect on
the sale of products by the Company to such customers.
Because of its participation in the defense industry, the Company is
subject to audit from time to time for its compliance with government
regulations by various agencies, including the Defense Contract Audit Agency,
the Defense Investigative Service and the Office of Federal Control Compliance
Programs. These and other governmental agencies may also from time to time
conduct inquiries or investigations that cover a broad range of Company
activity. Responding to any such audits, inquiries or investigations may
involve significant expense and divert management attention. Also, an adverse
finding in any such audit, inquiry or investigation could involve penalties
that may have a material adverse effect on the Company's business, financial
condition or operating results.
DEPENDENCE ON SUPPLIERS AND CONTRACT MANUFACTURERS
The Company relies on contract manufacturers and suppliers, in some
cases sole suppliers or limited groups of suppliers, to provide it with
services and materials necessary for the manufacture of products. Certain
ceramic low drift substrates (supplied by NTK of Japan and Alpha Industries,
Inc.), certain semiconductors (supplied by Alpha Industries, Inc., NEC Corp.,
M/A-Com, Inc., MWT and others) and certain components used in VCO products
(supplied by Alpha Industries, Inc., Lockheed Martin and Micrometrics, Ltd.)
used by the Company are sole source items and would require significant effort,
time or design changes to develop alternate sources. The Company is also
dependent on P-COM to supply it with certain modules necessary for the
production of microwave front ends for point-to-point radios for P-COM. The
Company's reliance on contract manufacturers and on sole suppliers involves
several risks, including a potential inability to obtain critical materials or
services and reduced control over production costs, delivery schedules,
reliability and quality of components or assemblies. Any inability to obtain
timely deliveries of acceptable quality, or any other circumstance that would
require the Company to seek alternative contract manufacturers or suppliers,
could delay the Company's ability to deliver products to customers, which in
turn would have a material adverse effect on the Company's business, financial
condition and operating results. In addition, in the event that costs for the
Company's contract manufacturers or suppliers increase, the Company may suffer
losses due to an inability to recover such cost increases under fixed price
production commitments to its customers.
LIMITATION ON PROTECTION OF PROPRIETARY TECHNOLOGY; RISK OF THIRD PARTY CLAIMS
The Company does not presently hold any significant patents applicable
to its products. In order to protect its intellectual property rights, the
Company relies on a combination of trade secret, copyright and trademark laws
and employee and third-party nondisclosure agreements, as well as limiting
access to and distribution of proprietary information. There can be no
assurance that the steps taken by the Company to protect its intellectual
property rights will be adequate to prevent misappropriation of the Company's
technology or to preclude competitors from independently developing such
technology. Furthermore, there can be no assurance that, in the future, third
parties will not assert infringement claims against the Company or with respect
to its products for which the Company has indemnified certain of its customers.
Asserting the Company's rights or defending against third party claims could
involve substantial costs and diversion
8
<PAGE> 10
of resources, thus materially and adversely affecting the Company's business,
financial condition and results of operations. In the event a third party were
successful in a claim that one of the Company's products infringed its
proprietary rights, the Company may have to pay substantial royalties or
damages, remove that product from the marketplace or expend substantial amounts
in order to modify the product so that it no longer infringes such proprietary
rights, any of which could have a material adverse effect on the Company's
business, financial condition and results of operations.
DEPENDENCE ON KEY PERSONNEL
The Company is highly dependent on the continued service of, and on
its ability to attract and retain, qualified engineering, management,
manufacturing, quality assurance, marketing and support personnel. The Company
does not maintain key man life insurance on its key executive officers and,
except for Joseph Lee (Executive Vice President) and James Mongillo (Vice
President), such personnel do not have employment or non-competition agreements
with the Company. Competition for such personnel is intense, and there can be
no assurance that the Company will be successful in attracting or retaining
such personnel. For example, the Company believes that microwave engineers
with the skills necessary to develop products for the wireless
telecommunications market currently are in high demand and that the Company may
not be able to attract and retain sufficient engineering expertise.
CONTROL BY MANAGEMENT
The Company's executive officers beneficially own a substantial
portion of the outstanding shares of the Common Stock of the Company and
comprise five of the ten members of the Board of Directors. As a result, such
persons have the ability to exercise influence over significant matters
regarding the Company. Such a high level of influence may have a significant
effect in delaying, deferring or preventing a change in control of the Company.
VOLATILITY OF STOCK PRICE
The market price of the shares of Common Stock, like the stock prices
of many technology companies, is subject to wide fluctuations in response to
such factors as actual or anticipated operating results, announcements of
technological innovations, new products or new contracts by the Company, its
competitors or their customers, government regulatory action, developments with
respect to wireless telecommunications, general market conditions and other
factors. In addition, the stock market has from time to time experienced
significant price and volume fluctuations that have particularly affected the
market prices for the stocks of technology companies and that have often been
unrelated to the operating performance of particular companies. The market
price of REMEC Common Stock has been volatile and may continue to be highly
volatile.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Shares. All proceeds from the sale of the Shares will be for the account of
the Selling Shareholders, as described below. See "Selling Shareholders" and
"Plan of Distribution" described below.
9
<PAGE> 11
SELLING SHAREHOLDERS
The following table sets forth as of the date of this Prospectus, the
name of each of the Selling Shareholders, the number of shares of Common Stock
that each such Selling Shareholder owns as of such date, the number of shares
of Common Stock owned by each Selling Shareholder that may be offered for sale
from time to time by this Prospectus, and the number of shares of Common Stock
to be held by each such Selling Shareholder assuming the sale of all the Common
Stock offered hereby. Except as indicated, none of the Selling Shareholders
has held any position or office or had a material relationship with the Company
or any of its affiliates within the past three years other than as a result of
the ownership of the Company's Common Stock. The Company may amend or
supplement this Prospectus from time to time to update the disclosure set forth
herein.
<TABLE>
<CAPTION>
Number of
Number of Shares to be
Number of Shares to be Owned after
Shares Owned Sold under Completion of
Name Prior to Offering(1) this Prospectus Offering
---- ----------------- --------------- --------
<S> <C> <C> <C>
Butler Family Survivor Trust U/T/D 70,380 70,380 0
6/17/1992
Keith Butler 53,820 53,820 0
Kendra Wilson 13,800 13,800 0
</TABLE>
- ----------------------
(1) The number and percentage of shares beneficially owned is determined
in accordance with Rule 13d-3 of the Exchange Act, and the information
is not necessarily indicative of beneficial ownership for any other
purpose. Under such rule, beneficial ownership includes any shares as
to which the individual has sole or shared voting power or investment
power and also any shares which the individual has the right to
acquire within 60 days of the date of this Prospectus through the
exercise of any stock option or other right. Unless otherwise
indicated in the footnotes, each person has sole voting and investment
power (or shares such powers with his or her spouse) with respect to
the Shares shown as beneficially owned.
10
<PAGE> 12
PLAN OF DISTRIBUTION
The Shares covered by this Prospectus may be offered and sold from
time to time by the Selling Shareholders. The Selling Shareholders will act
independently of the Company in making decisions with respect to the timing,
manner and size of each sale. The Selling Shareholders may sell the Shares
being offered hereby on the Nasdaq National Market, or otherwise, at prices and
under terms then prevailing or at prices related to the then current market
price or at negotiated prices. The Shares may be sold by one or more of the
following means of distribution: (a) a block trade in which the broker-dealer
so engaged will attempt to sell Shares as agent, but may position and resell a
portion of the block as principal to facilitate the transaction; (b) purchases
by a broker-dealer as principal and resale by such broker-dealer for its own
account pursuant to this Prospectus; (c) an over-the-counter distribution in
accordance with the rules of the Nasdaq National Market; (d) ordinary brokerage
transactions and transactions in which the broker solicits purchasers; and (e)
in privately negotiated transactions. To the extent required, this Prospectus
may be amended and supplemented from time to time to describe a specific plan
of distribution. In connection with distributions of the Shares or otherwise,
the Selling Shareholders may enter into hedging transactions with
broker-dealers or other financial institutions. In connection with such
transactions, broker-dealers or other financial institutions may engage in
short sales of the Company's Common Stock in the course of hedging the
positions they assume with Selling Shareholders. The Selling Shareholders may
also sell the Company's Common Stock short and redeliver the shares to close
out such short positions. The Selling Shareholders may also enter into option
or other transactions with broker-dealers or other financial institutions which
require the delivery to such broker-dealer or other financial institution of
Shares offered hereby, which Shares such broker-dealer or other financial
institution may resell pursuant to this Prospectus (as supplemented or amended
to reflect such transaction). The Selling Shareholders may also pledge Shares
to a broker-dealer or other financial institution, and, upon a default, such
broker-dealer or other financial institution, may effect sales of the pledged
Shares pursuant to this Prospectus (as supplemented or amended to reflect such
transaction). In addition, any Shares that qualify for sale pursuant to Rule
144 may be sold under Rule 144 rather than pursuant to this Prospectus.
In effecting sales, brokers, dealers or agents engaged by the Selling
Shareholders may arrange for other brokers or dealers to participate. Brokers,
dealers or agents may receive commissions, discounts or concessions from the
Selling Shareholders in amounts to be negotiated prior to the sale. Such
brokers or dealers and any other participating brokers or dealers may be deemed
to be "underwriters" within the meaning of the Securities Act in connection
with such sales, and any such commissions, discounts or concessions may be
deemed to be underwriting discounts or commissions under the Securities Act.
The Selling Shareholders may agree to indemnify, under certain circumstances,
brokers or dealers engaged by them to effect sales of the Shares against
certain liabilities, including liabilities arising under the Securities Act.
The Company will pay all expenses incident to the offering and sale of the
Shares to the public other than any commissions and discounts of underwriters,
dealers or agents and any transfer taxes.
In order to comply with the securities laws of certain states, if
applicable, the Shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
Shares may not be sold unless they have been registered or qualified for sale
in the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.
The Company has advised the Selling Shareholders that the
anti-manipulation rules of Regulation M under the Exchange Act may apply to
sales of Shares in the market and to the activities of the Selling Shareholders
and their affiliates. In addition, the Company will make copies of this
Prospectus available to the Selling Shareholders and has informed them of the
need for delivery of copies of this Prospectus to purchasers at or prior to the
time of any sale of the Shares offered hereby.
At the time a particular offer of Shares is made, if required, a
Prospectus Supplement will be distributed that will set forth the number of
Shares being offered and the terms of the offering, including the name of any
underwriter, dealer or agent, the purchase price paid by any underwriter, any
discount, commission and other item constituting compensation, any discount,
commission or concession allowed or reallowed or paid to any dealer, and the
proposed selling price to the public.
11
<PAGE> 13
The sale of Shares by the Selling Shareholders is subject to
compliance by the Selling Shareholders with certain contractual restrictions
with the Company. There can be no assurance that the Selling Shareholders will
sell all or any of the Shares.
The Company has agreed to indemnify the Selling Shareholders and any
person controlling a Selling Shareholder against certain liabilities, including
liabilities under the Securities Act. The Selling Shareholders have agreed to
indemnify the Company and certain related persons against certain liabilities,
including liabilities under the Securities Act.
The Company has agreed with the Selling Shareholders to keep the
Registration Statement of which this Prospectus constitutes a part effective
for up to two years following March 31, 1997, the closing date of the Veritek
Merger (which period may be shortened or extended under certain circumstances).
The Company intends to de-register any of the Shares not sold by the Selling
Shareholders at the end of such two year period; however it is anticipated that
at such time any unsold shares may be freely tradable subject to compliance
with Rule 144 of the Securities Act.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be
passed upon by Heller Ehrman White & McAuliffe, Los Angeles, California,
counsel to the Company.
EXPERTS
The consolidated financial statements and schedule of REMEC, Inc.
appearing in REMEC, Inc.'s Annual Report (Form 10-K/A) for the year ended
January 31, 1997 and 1996 and for each of the three years in the period ended
January 31, 1997, have been audited by Ernst & Young LLP, independent auditors,
as set forth in their reports thereon included therein and incorporated herein
by reference elsewhere herein which, as to the years 1997, 1996 and 1995, are
based in part on the reports of Ireland San Filippo, LLP, independent auditors.
Such consolidated financial statements referred to above are incorporated
herein by reference in reliance upon such reports given upon the authority of
such firms as experts in accounting and auditing.
12
<PAGE> 14
No dealer, salesperson or other person has been authorized to give any
information or make any representations not contained in this Prospectus in
connection with the offering covered by this Prospectus. If given or made,
such information or representations must not be relied upon as having been
authorized by the Company. This Prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy, the Shares in any jurisdiction
where, or to any person to whom, it is unlawful to make such offer or
solicitations. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that there has
been no change in the facts set forth in this Prospectus or in the affairs of
the Company since the date hereof.
___________________________
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Incorporation of Certain Documents
by Reference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Forward-Looking Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Selling Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Legal Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
</TABLE>
138,000 Shares
REMEC
Common Stock
______________________
PROSPECTUS
______________________
_________________, 1997
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The Company will pay all expenses incident to the offering and sale to the
public of the shares being registered other than any commissions and discounts
of underwriters, dealers or agents and any transfer taxes. Such expenses are
set forth in the following table. All of the amounts shown are estimates
except the Securities and Exchange Commission ("SEC") registration fee.
<TABLE>
<S> <C>
SEC registration fee . . . . . . . . . . . . . $ 931
Legal fees and expenses . . . . . . . . . . . . 5,000
Accounting fees and expenses . . . . . . . . . 1,000
Miscellaneous expenses . . . . . . . . . . . . 1,069
------
Total . . . . . . . . . . . . . . . . . . $8,000
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant has the power to indemnify its officers and directors
against liability for certain acts pursuant to Section 317 of the General
Corporation Law of California. Articles Fifth and Sixth of the Registrant's
Amended and Restated Articles of Incorporation provide as follows:
"Fifth: The liability of directors of this Corporation for
monetary damages shall be eliminated to the fullest extent permissible
under California law."
"Sixth: This Corporation is authorized to provide indemnification
of agents (as defined in Section 317 of the California Corporations Code)
for breach of duty to this Corporation and its shareholders through bylaw
provisions, or through agreements with the agents, or otherwise, in excess
of the indemnification otherwise permitted by Section 317 of the
California Corporations Code, subject to the limits on such excess
indemnification set forth in Section 204 of the Code."
In addition, Article V of the Registrant's By-laws provides that the
Registrant shall indemnify its directors and executive officers to the fullest
extent not prohibited by California General Corporation Law and provides for
the advancement of expenses upon a receipt of an undertaking to repay such
amounts if the person is determined ultimately not to be entitled to
indemnification.
The Registrant has entered into Indemnification Agreements with its
officers and directors.
ITEM 16. EXHIBITS.
5.1 Opinion of Heller Ehrman White & McAuliffe.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Ireland San Filippo, LLP, Independent Public
Accountants.
23.3 Consent of Counsel (included in Exhibit 5.1).
24.1 Power of Attorney (included on page II-4).
II-1
<PAGE> 16
ITEM 17. UNDERTAKINGS.
A. UNDERTAKING PURSUANT TO RULE 415.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3)
Securities Act of 1933 (the "Securities Act");
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected
in the form of prospectus filed with the SEC pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration
Statement;
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement; provided, however, that paragraphs
A(l)(i) and A(l)(ii) do not apply if the Registration
Statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by
the Registrant pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 (the "Exchange Act")
that are incorporated by reference in the Registration
Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of this offering.
B. UNDERTAKING REGARDING FILINGS INCORPORATING SUBSEQUENT EXCHANGE ACT
DOCUMENTS BY REFERENCE.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
II-2
<PAGE> 17
C. UNDERTAKING IN RESPECT OF INDEMNIFICATION.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the SEC such indemnification
is against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.
II-3
<PAGE> 18
SIGNATURE
Pursuant to the requirements of the Securities Act of 1933, REMEC, Inc.
has duly caused this Registration Statement on Form S-3 to be signed on its
behalf by the undersigned, thereunto duly authorized, in San Diego, California
on July 1, 1997.
REMEC, INC.
By: /s/ Ronald E. Ragland
------------------------------------
Ronald E. Ragland
Chairman of the Board and
Chief Executive Officer
POWERS OF ATTORNEY
Each person whose signature appears below constitutes and appoints Ronald
E. Ragland and Thomas A. George his true and lawful attorneys-in-fact and
agents, each acting alone, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign
any or all amendments (including post-effective amendments) to the Registration
Statement, and to sign any registration statement for the same offering covered
by this Registration Statement that is to be effective upon filing pursuant to
Rule 462(b) under the Securities Act of 1933, as amended, and all
post-effective amendments thereto, and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, full
power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, each acting alone, or his or her
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
--------- -------- ----
<S> <C> <C>
/s/ Ronald E. Ragland Chairman of the Board and Chief July 1, 1997
--------------------------------------- Executive Officer (Principal
Ronald E. Ragland Executive Officer)
/s/ Errol Ekaireb President, Chief Operating Officer July 1, 1997
--------------------------------------- and Director
Errol Ekaireb
/s/ Jack A. Giles Executive Vice President, President July 1, 1997
--------------------------------------- of REMEC Microwave Division and
Jack A. Giles Director
/s/ Denny Morgan Director, Senior Vice President and July 1, 1997
--------------------------------------- Chief Engineer
Denny Morgan
</TABLE>
II-4
<PAGE> 19
<TABLE>
<S> <C> <C>
/s/ Joseph T. Lee Executive Vice President and July 1, 1997
-------------------------------------- Director
Joseph T. Lee
/s/ Thomas A. George Chief Financial Officer, Senior Vice July 1, 1997
--------------------------------------- President and Secretary (Principal
Thomas A. George Financial and Accounting Officer)
/s/ Andre R. Horn Director July 1, 1997
---------------------------------------
Andre R. Horn
/s/ Gary L. Luick Director July 1, 1997
---------------------------------------
Gary L. Luick
/s/ Jeffrey M. Nash Director July 1, 1997
---------------------------------------
Jeffrey M. Nash
/s/ Thomas A. Corcoran Director July 1, 1997
---------------------------------------
Thomas A. Corcoran
/s/ William H. Gibbs Director July 1, 1997
---------------------------------------
William H. Gibbs
</TABLE>
II-5
<PAGE> 20
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit No. Description Numbered Pages
- ----------- ----------- --------------
<S> <C> <C>
5.1 Opinion of Heller Ehrman White & McAuliffe.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Ireland San Filippo, LLP, Independent Public Accountants.
23.3 Consent of Counsel (included in Exhibit 5.1).
24.1 Power of Attorney (included on page II-4).
</TABLE>
<PAGE> 1
EXHIBIT 5.1
July 1, 1997
REMEC, Inc.
9404 Chesapeake Drive
San Diego, California 92123
Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as counsel to REMEC, Inc., a California corporation
(the "Company"), in connection with the Registration Statement on Form S-3
contemplated to be filed with the Securities and Exchange Commission on July 2,
1997 (the "Registration Statement"), for the purpose of registering under the
Securities Act of 1933, as amended, 138,000 currently issued and outstanding
shares of the Company's Common Stock, $0.01 par value per share (the "Shares"),
that may be sold by certain shareholders (the "Selling Shareholders") of the
Company pursuant to the Registration Statement.
In connection with this opinion, we have assumed the authenticity
of all records, documents and instruments submitted to us as originals, the
genuineness of all signatures, the legal capacity of natural persons and the
conformity to the originals of all records, documents and instruments submitted
to us as copies. We have based our opinion upon our review of the following
records, documents, instruments and certificates:
(a) The Restated Articles of Incorporation of the Company
certified by the Secretary of State of the State of
California as of June 25, 1997, and certified to us by an
officer of the Company as being complete and in full force
and effect as of the date of this opinion;
(b) The Bylaws of the Company certified to us by an officer of
the Company as being complete and in full force and effect
as of the date of this opinion;
(c) A Certificate of the Secretary of the Company: (i)
certifying that copies of all records of proceedings and
actions of the Board of Directors of the Company, including
any committee thereof, relating to the issuance of the
Shares and the proposed resale of the Shares pursuant to the
Registration Statement have been provided to us; and (ii)
certifying as to certain factual matters; and
(d) The Registration Statement.
This opinion is limited to the laws of the State of California, and
we disclaim any opinion as to the laws of any other jurisdiction. We further
disclaim any opinion as to any other statute, rule, regulation, ordinance,
order or other promulgation of any other jurisdiction or any regional or local
governmental body or as to any related judicial or administrative opinion. Our
opinion to the effect that
<PAGE> 2
REMEC, Inc.
July 1, 1997
Page 2
all issued and outstanding Shares are fully paid and nonassessable is based on
the certification obtained from the Company identified in item (c) above to the
effect that the consideration for such Shares recited in the Board of
Directors' resolutions for such Shares has been received.
Our opinion expressed below also assumes that: (i) the Registration
Statement becomes and remains effective during the period when the Shares are
offered and sold; (ii) the capitalization of the Company is as described in the
Registration Statement; and (iii) all applicable securities laws are complied
with in connection with the sale of the Shares by the Selling Shareholders.
Based upon the foregoing and our examination of such questions of
law as we have deemed necessary or appropriate for the purpose of this opinion,
it is our opinion that the currently issued and outstanding Shares covered by
the Registration Statement to be sold by the Selling Shareholders are legally
issued, fully paid and nonassessable.
This opinion is rendered to you in connection with the Registration
Statement and is solely for your benefit. This opinion may not be relied upon
by you for any other purpose, or relied upon by any other person, firm,
corporation or other entity for any purpose, without our prior written consent.
We disclaim any obligation to advise you of any change of law that occurs, or
any facts of which we become aware, after the date of this opinion.
We hereby consent to the filing of this opinion as an exhibit to
the Registration Statement. We also consent to the reference to our firm under
the caption "Legal Matters" in the Registration Statement and any amendments
thereto.
Very truly yours,
/s/ HELLER EHRMAN WHITE & McAULIFFE
<PAGE> 1
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of REMEC, Inc. for the
registration of 138,000 shares of its common stock and to the incorporation by
reference therein of our report dated February 24, 1997, except for the first
paragraph of Note 2, as to which the date is February 28, 1997, with respect to
the consolidated financial statements of REMEC, Inc. included in its Annual
Report (Form 10-K/A) for the year ended January 31, 1997 and the related
financial statement schedule included therein, filed with the Securities and
Exchange Commission.
/s/ ERNST & YOUNG LLP
San Diego, California
July 3, 1997
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the reference to
our firm under the caption "Experts" in the Registration Statement (Form S-3)
and related Prospectus of REMEC, Inc. for the registration of 138,000 shares of
its common stock and to the incorporation by reference therein of our report,
dated March 6, 1997, on the financial statements of Radian Technology, Inc. as
of December 27, 1996, and for the three years then ended.
/s/ IRELAND SAN FILIPPO, LLP
San Jose, California
July 3, 1997
