STM WIRELESS, INC. SELLS R.F. MICROSYSTEMS SUBSIDIARY TO REMEC, INC.; STM and REMEC Enter into Long-Term Strategic Relationship -.

IRVINE, Calif.--(BUSINESS WIRE)--April 1, 1996--STM WIRELESS, INC. (STM), (NASDAQ NM Symbol: STMI), today announced that it had signed a series of agreements with REMEC, Inc. (NASDAQ NM Symbol: REMC) to sell for cash its R.F. Microsystems subsidiary and enter into a long-term strategic relationship for the procurement of microwave components for its VSAT products. REMEC will immediately assume management and operations of R.F. Microsystems.

The products which STM will be acquiring from REMEC will be the R.F. Microsystems designed C-band transceivers for its X-Star and DAMA 10000 VSATs. In addition, STM has entered into a product design and supply agreement for its new "Subscriber Earth Station" basic telephony system. The purchase commitments for these products over the term of the agreements are in excess of $20 million.

Commenting on the transaction, E. Youssefzadeh, President and CEO of STM Wireless said, "Although R.F. Microsystems has been an excellent partner for STM, the growth and development of our basic business requires high volume, high quality, low cost manufacturing. REMEC is an ideal partner and provides STM with the additional capability needed to compete successfully in the wireless telecommunications infrastructure market."

Mr. Youssefzadeh continued, "We are extremely excited about the prospects of working with REMEC on the design of the Subscriber Earth Station which is planned for deployment late this year. As previously announced on December 26, 1995, we have an order of approximately $60 million from HSCL in India, our joint venture with Himachal Futuristic Communications Limited (HFCL), which includes products of this type. We also anticipate strong demand from Asia/Pacific and Latin America. With this agreement, STM is well positioned to compete for basic telephony service in developing countries. Our systems can be deployed earlier and compete directly with proposed low earth orbiting satellite (LEO) and mid-earth orbiting satellite (MEO) offerings."

With the exception of the actual reported financial results, the statements made in this news release are forward looking statements that involve risks and uncertainties. As discussed in the Company's initial public offering final prospectus, its Annual Report on Form 10-K for the year ended December 31, 1994, and its Form 10-Q for the first three quarters of fiscal 1995, the Company's future operating results are uncertain and may be impacted by the following factors, among others: the long-term cycle involved in completing major contracts, particularly in foreign markets, increasing competitive pressures, general economic conditions, technological advances, the timing of new product introductions, political and economic risks involved in foreign markets and foreign currencies and the timing of operating and other expenditures.

STM Wireless, Inc., headquartered in Irvine, California, is a leading manufacturer of wireless communications products, including very small aperture terminals (VSATs), transceivers, modems and other networking equipment. STM products are designed to support data, fax, voice and video networks requiring cost-effective connections. The Company's proprietary equipment and software are installed in North America, Latin America, Europe and the Asia/Pacific. The Company also sells services to customers on networks it owns and operates.

REMEC, Inc. is a leader in the design and manufacture of microwave multi-function modules (MFMs) for the microwave transmission systems used in defense systems and the commercial wireless telecommunications market.

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