Document:

<PAGE>

                                                                    Exhibit 10.2

                              SETTLEMENT AGREEMENT

         THIS SETTLEMENT AGREEMENT (this "Agreement") is entered into by and
among JIM BOLT ("Bolt"), TONY AMEND ("Amend"), MARIE FOREHAND ("Forehand")
(Bolt, Amend and Forehand hereinafter sometimes referred to collectively as
the "Plaintiffs"); MEL ROBINSON ("Robinson"), LUCIA KUGLER ("Kugler") and
AAROW ENVIRONMENTAL GROUP, INC., a corporation ("Aarow"), FRED SHEFTE,
individually and as President of Aarow ("Shefte"), SAM D. YATES, individually
and as Vice-President of Aarow ("Yates"), and STAN SISEMORE, individually and
as Vice-President of Aarow ("Sisemore") (Aarow, Shefte, Yates, and Sisemore
hereinafter sometimes referred to individually as a "Defendant" and
collectively as the "Defendants").

         WHEREAS, the Plaintiffs filed a lawsuit against the Defendants and
others in the Chancery Court of Benton County, Arkansas titled: JIM BOLT,
TONY AMEND AND MARIE FOREHAND VS. AAROW ENVIRONMENTAL GROUP, INC., A
CORPORATION, FRED SHEFTE, INDIVIDUALLY AND AS PRESIDENT OF AAROW
ENVIRONMENTAL GROUP; SAM D. YATES, INDIVIDUALLY AND AS VICE PRESIDENT OF
AAROW ENVIRONMENTAL GROUP; STAN SISEMORE, INDIVIDUALLY AND AS VICE PRESIDENT
OF AAROW ENVIRONMENTAL GROUP; RONALD L. BAKER, AN INDIVIDUAL; GARY K. DUKE,
AN INDIVIDUAL; MIKE ERHART, AN INDIVIDUAL; MIKE MORRISSET, AN INDIVIDUAL; AND
MIKE CANFIELD, AN INDIVIDUAL (Case No. 000844-2) (the "Lawsuit");

         WHEREAS, the Plaintiffs and the Defendants have negotiated a full
settlement of all claims and disputes arising from the Lawsuits and
otherwise; and

         WHEREAS, the Plaintiffs and the Defendants have prepared this
Agreement to memorialize the terms and conditions of such full settlement.

         WHEREAS, Robinson and Kugler intend to assert claims similar to
those of the Plaintiffs in an amendment to the complaint.

         WHEREAS, This settlement does not acknowledge the merits of any
claim against any Defendant or any non-signatory party and does not represent
an acknowledgment of the jurisdiction of this court over any Defendant other
than those specifically made a signatory party to this Agreement.

         NOW, THEREFORE, in exchange for the consideration herein cited and
for other good and valuable consideration, the receipt and sufficiency of
which all parties hereto confirm, the parties agree as follows:

1. FULL AND FINAL SETTLEMENT - Bolt, Amend, Forehand, Robinson, and Kugler
hereby acknowledge and agree that this is a full settlement and satisfaction
of all claims of whatever kind or character they may have, known or unknown,
against Aarow Environmental Group, Inc. and all of its officers and
directors, Aarow Broad Band Wireless Communications, Inc. and all of its
officers and directors, Fred Shefte, Sam D. Yates, Stan Sisemore, Ronald
Baker, Gary P. Duke, Mike Erhart, Mike Morrisset, and Mike Canfield, their
heirs, executors administrators, employees, agents and assigns and all other
persons, firms or corporations liable or, who might be claimed to be liable,
none of whom admit any liability to Bolt, Amend, Forehand, Robinson, and
Kugler, but all expressly deny any liability, from any and all claims,
demands, damages, actions, causes of action or suits of any kind or nature
whatsoever, and particularly on account of all injuries, known or unknown,
both to person and property, which have resulted or may in the future develop
from the business or other

<PAGE>

relationships between the parties, which is the subject of the lawsuit
pending in Benton County, Arkansas or from the issuance or transfer of
securities as part of the settlement.

         Bolt, Amend, Forehand, Robinson, and Kugler , declare and represent,
in making this Release and agreement, it is understood and agreed that they
are relying wholly upon their own judgment, belief, and knowledge of the
nature, extent severity and duration of any damages, and that they have not
been influenced to any extent whatever in making this Release by any
representatives or statements regarding said damages, or regarding any other
matters, made by the parties who are hereby released, or by any person or
persons representing the parties released by this document.

2. DISMISSAL OF LAWSUIT - The Plaintiffs will cause the Lawsuit to be
dismissed "with prejudice" as to each Defendant and as to Ronald L. Baker,
Gary K. Duke, Mike Erhart, Mike Morrisset and Mike Canfield. Upon the
execution of this Agreement, Plaintiffs will deliver a fully executed
dismissal with prejudice, as described in this Paragraph, in a form
reasonably acceptable to Defendants.

3. TRANSFER OF UTICA PUBLISHING CORPORATION - Upon the execution of this
Agreement, Aarow will transfer and assign all of its rights, titles and
interest in Utica Publishing Corporation, an Arkansas corporation ("Utica"),
a wholly-owned subsidiary of Aarow, to Bolt by an assignment of one hundred
percent (100%) of the outstanding shares of Utica. Utica assets will be
transferred without warranty in an "as is" condition. No promises,
representations or warranties have been made to Bolt or others regarding
Utica's business prospects or financial condition. Prior to the assignment of
the Utica stock to Bolt, Bolt will perform due diligence on the assets and
liabilities of Utica. In the event that the assets of Utica have been
dissipated, other than in the ordinary course of business, since the
acquisition of Utica by Aarow, then Bolt will receive shares of Aarow common
stock (in addition to the shares of Aarow Common Stock described in Paragraph
4, below) equal in value to the amount of the reduction in asset value. The
parties agree that an additional conveyance of 18,500 Aarow's common stock
will satisfy the obligations of the preceding sentence.

4. YATES DEBENTURE, REGIONS BANK NOTE AND OTHER MATTERS - As part of this
Settlement Agreement, Arrow will hold Bolt and Utica harmless from and will
assume all obligations of or under: (i) a fifty thousand dollar ($50,000)
debenture from Aarow to Yates; and (ii) a note payable by Utica to Regions
Bank in the approximate amount of fifty seven thousand dollars ($57,000) such
note being guaranteed by Yates. Upon the execution of this Agreement, Aarow
will execute such further documents reasonably deemed necessary by Bolt or
Utica to substantiate the obligations described in Paragraph 4. Attached and
incorporated by reference is a Utica balance sheet at January 31, 2000. (Ex.
A.) Aarow will save and hold harmless Utica from those liabilities which are
circled and initialed by Bolt and an authorized representative of Aarow,
provided any of such amounts that are owed to Bolt shall remain the sole
responsibility of Utica. Aarow will cause to be released all Regions' liens
within 20 days of this Agreement.

5. ISSUANCE OF FREE-TRADING SHARES OF COMMON STOCK TO BOLT - Upon the
execution of this Agreement, or as soon as reasonably possible thereafter,
Aarow will cause to be issued to Bolt seven hundred thousand (700,000) shares
of Aarow's common stock, such stock to be free-trading and not subject to any
restriction as to transferee (the "Bolt Shares"). Bolt acknowledges and
agrees that the Bolt Shares will be issued by Aarow pursuant to an exemption
from registration under Section 3(a)(10) of the Securities Act of 1933 and
Bolt shall, in all aspects, comply with such exemption. Pursuant to this
Agreement, Bolt shall surrender any and all shares of stock, if any,
previously issued to or on behalf of Bolt by Aarow. Aarow and Bolt recognize
and acknowledge that any settlement and

                                       2

<PAGE>

issuance of the Bolt Stock pursuant to Section 3(a)(10) of the Securities Act
of 1933 must be reviewed and approved, after a hearing, by a judge of
competent jurisdiction and, as such, the provisions of this Paragraph 4 are
contingent upon court approval. Bolt acknowledges and agrees that the terms
of this Agreement are fair within the meaning of said Section 3(a)(10) and
Bolt agrees to advise the Court accordingly as part of the hearing to approve
this settlement and issuance of the shares.

6. ISSUANCE OF FREE-TRADING SHARES OF COMMON STOCK TO AMEND, FOREHAND, ET AL.
-Upon the execution of this Agreement, or as soon as reasonably possible
thereafter, Aarow will cause to be issued fourteen thousand (14,000) shares
of Aarow's common stock to each of the following individuals: Amend,
Forehand, Robinson, Kugler, such stock to be free-trading and not subject to
any restriction as to transferee. Amend, Forehand, Robinson, Kugler each
acknowledges and agrees that the shares to be issued by Aarow pursuant to
this Paragraph 5 are issued pursuant to an exemption from registration under
Section 3(a)(10) of the Securities Act of 1933 and they each shall, in all
aspects, comply with such exemption. Amend, Forehand, Robinson and Kugler
each has acquired 14,000 shares of Aarow's common stock, these shares are
hereby transferred and surrendered to Aarow for cancellation. Aarow, Amend,
Forehand, Robinson and Kugler recognize and acknowledge that any settlement
and issuance of Aarow common stock as described by this Paragraph 5 and
pursuant to Section 3(a)(10) of the Securities Act of 1933 must be reviewed
and approved, after a hearing, by a judge of competent jurisdiction and, as
such, the provisions of this Paragraph 5 are contingent upon court approval.
Amend, Forehand, Robinson and Kugler acknowledge and agree that the terms of
this Agreement are fair within the meaning of said Section 3(a)(10) and they
agree to advise the Court accordingly as part of the hearing to approve this
settlement and issuance of the shares.

7. REVIEW OF AAROW FINANCIALS AND UTICA ASSETS - The Plaintiffs, Robinson and
Kugler acknowledge and affirm that they were offered adequate time and
opportunity to review Aarow's current financials, preliminary and final
drafts of Aarow's current Form 8-k filing relating to the recent merger with
Global Wireless Communications Corporation and other SEC reports.
Additionally, the Plaintiffs, Robinson and Kugler acknowledge and affirm that
they were afforded the opportunity to meet the current officers and directors
of Aarow to discuss its ongoing operations and future plans. Plaintiffs,
Robinson and Kugler further acknowledge and affirm that they have declined
the opportunity to review the financial records described in the first
sentence of this Paragraph 7 and have declined the opportunity described in
the second sentence of this Paragraph 7. Plaintiffs also acknowledge that
they were offered a chance to perform and conduct due diligence on the Utica
assets and that they did so to the extent they deemed necessary and advisable.

8. CONFIDENTIALITY AND NON-DISPARAGEMENT PARAGRAPH - It is further understood
and agreed that the terms of this Release and the payment herein acknowledged
will be held in confidence; provided, however, that Aarow may disclose
information about this agreement to the extent deemed necessary to comply
with its obligations under the federal securities laws. Bolt, Amend,
Forehand, Robinson, and Kugler and their attorneys agree not to publicize,
publish, disclose, talk about or promote the publication or disclosure of the
facts or terms of this Release, except as may otherwise be further agreed to
in writing, the amount of the payment herein acknowledge or any other matter
related to the settlement evidenced hereby to any person not a party to this
Release unless such a disclosure is required by law or regulation or during a
Court proceeding.

9. STOCK SALES BY BOLT - Bolt agrees that he will not sell, post-transfer,
more than 100,000 shares of Aarow per day.

                                       3

<PAGE>

10. DELIVERY OF AAROW STOCK - Aarow stock will be delivered to plaintiffs no
later than noon Friday, May 12, 2000.

11. INTEGRATION CLAUSE - All parties agree that this writing constitutes the
entire agreement between the parties regarding the subject matter thereof and
that any and all previous promises, representations and warranties are
replaced by this writing and fully integrated into this Agreement.

12. MISCELLANEOUS TERMS - The non-signatory parties to this Agreement have
not consented to the jurisdiction of the Arkansas courts, even involving the
enforcement of this Agreement.

JIM BOLT          /S/ JIM BOLT                    /S/ FRED SHEFTE
        -------------------------------  ---------------------------------------
DATE:             5/9/2000               FRED SHEFTE, INDIVIDUALLY
     ----------------------------------  DATE:    5/9/2000
                                              ----------------------------------

TONY AMEND        /S/ TONY AMEND                  /S/ SAM D. YATES
          -----------------------------  ---------------------------------------
DATE:             5/9/2000               SAM D. YATES, INDIVIDUALLY AND AS VICE-
     ----------------------------------  PRESIDENT
                                         DATE:    5/9/2000
                                              ----------------------------------

MARIE FOREHAND    /S/ MARIE FOREHAND              /S/ STAN SISEMORE
              -------------------------  ---------------------------------------
DATE:             5/9/2000               STAN SISEMORE, INDIVIDUALLY AND AS
     ----------------------------------  VICE-PRESIDENT
                                         DATE:    5/10/2000
                                              ----------------------------------
MEL ROBINSON      /S/ MEL ROBINSON
            ---------------------------
DATE:             5/10/2000
     ----------------------------------  Schedules to Agreement available upon
                                         request.

LUCIA KUGLER      /S/ LUCIA KUGLER
            ---------------------------
DATE:
     ----------------------------------

AAROW ENVIRONMENTAL GROUP,
INC., AN ARKANSAS CORPORATION

BY:      /S/ FRED SHEFTE
   ------------------------------------
NAME: FRED SHEFTE
TITLE: PRESIDENT
DATE:    5/9/2000
     ----------------------------------

                                       4<PAGE>

                                                                  EXHIBIT 10.1

             CONSENT, WAIVER AND FIRST AMENDMENT TO CREDIT AGREEMENT

         This CONSENT, WAIVER AND FIRST AMENDMENT TO CREDIT AGREEMENT
("Amendment") is dated as of June 15, 2000, and is entered into by and between
Cherokee International, LLC, a California limited liability company
("Borrower"), Heller Financial, Inc., in its capacity as Agent for the Lenders
party to the Credit Agreement described below ("Agent"), and the Lenders which
are signatories hereto.

         WHEREAS, Agent, Lenders and Borrower are parties to a certain Credit
Agreement dated April 30, 1999 (as such agreement has from time to time been
amended, supplemented or otherwise modified, the "Agreement"); and

         WHEREAS, the Company desires to acquire Industrial and
Telecommunications Systems S.C.A., a Belgian company ("ITS OpCo") and Industrial
and Telecommunications Systems SPRL, a Belgian company ("ITS MgmtCo"; together
with ITS OpCo hereinafter sometimes referred to collectively as "ITS"); and

         WHEREAS, the parties desire to amend the Agreement as hereinafter set
forth.

         NOW THEREFORE, in consideration of the mutual conditions and agreements
set forth in the Agreement and this Amendment, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:

         1.       DEFINITIONS. Capitalized terms used in this Amendment, unless
otherwise defined herein, shall have the meaning ascribed to such terms in the
Agreement.

         2.       AMENDMENTS. Subject to the conditions set forth below, the
Agreement is amended as follows:

                  (a) Subsection 1.2 is amended by deleting the definition of
"LIBOR" and inserting the following in lieu thereof:

                           "LIBOR" means, for each Interest Period, a rate per
                           annum equal to:

                           (a) the offered rate for deposits in U.S. dollars in
                           an amount comparable to the amount of the applicable
                           Loan in the London interbank market which is
                           published by the British Bankers' Association, and
                           that currently appears on Telerate Page 3750, or any
                           other source available to Agent, as of 11:00 a.m.
                           (London time) on the day which is two (2) Business
                           Days prior to the first day of the relevant Interest
                           Period for a term comparable to such Interest Period;
                           or if, for any reason, such a rate is not published
                           by the British Bankers' Association on Telerate or
                           any other source available to Agent, the rate per
                           annum equal to the average rate (rounded

<PAGE>

                           upwards, if necessary, to the nearest 1/100 of 1%)
                           at which Agent determines that U.S. dollars in an
                           amount comparable to the amount of the applicable
                           Loans are being offered to prime banks at
                           approximately 11:00 a.m. (London time) on the day
                           which is two (2) Business Days prior to the first day
                           of such Interest Period for a term comparable to such
                           Interest Period for settlement in immediately
                           available funds by leading banks in the London
                           interbank market selected by Agent DIVIDED BY

                           (b) a number equal to 1.0 MINUS the aggregate (but
                           without duplication) of the rates (expressed as a
                           decimal fraction) of reserve requirements in effect
                           on the day which is two (2) Business Days prior to
                           the beginning of such Interest Period (including,
                           without limitation, basic, supplemental, marginal and
                           emergency reserves under any regulations of the Board
                           of Governors of the Federal Reserve System or other
                           governmental authority having jurisdiction with
                           respect thereto, as now and from time to time in
                           effect) for Eurocurrency funding (currently referred
                           to as "Eurocurrency Liabilities" in Regulation D of
                           such Board) which are required to be maintained by a
                           member bank of the Federal Reserve System; such rate
                           to be rounded upward to the next whole multiple of
                           one-sixteenth of one percent (.0625%).

                  (b)      Subsection 1.1(A) is amended by deleting such
subsection in its entirety and inserting the following in lieu thereof:

                           (A)      TERM LOANS.

                  (i) Each Lender agrees, severally and not jointly, to lend to
         Borrower in one draw on the Closing Date, its Pro Rata Share of the
         aggregate amount of $50,000,000.00 (the "Term Loan A"). Borrower shall
         repay the Term Loan A through periodic payments on the dates and in the
         amounts indicated below ("Term Loan A Scheduled Installments"). Amounts
         borrowed under this subsection 1.1(A)(i) and repaid may not be
         reborrowed.

<TABLE>
<CAPTION>

                                    DATE                               SCHEDULED INSTALLMENT
                                    ----                               ---------------------

<S>                                                                    <C>
                                    September 30, 1999                          $625,000.00
                                    December 31, 1999                           $625,000.00
                                    March 31, 2000                              $625,000.00
                                    June 30, 2000                               $582,278.48
                                    September 30, 2000                          $1,397,468.35
                                    December 31, 2000                           $1,397,468.35
                                    March 31, 2001                              $1,397,468.35
                                    June 30, 2001                               $1,397,468.35

                                       2
<PAGE>

                                    September 30, 2001                          $1,863,291.14
                                    December 31, 2001                           $1,863,291.14
                                    March 31, 2002                              $1,863,291.14
                                    June 30, 2002                               $1,863,291.14
                                    September 30, 2002                          $2,072,911.39
                                    December 31, 2002                           $2,072,911.39
                                    March 31, 2003                              $2,072,911.39
                                    June 30, 2003                               $2,072,911.39
                                    September 30, 2003                          $2,562,025.32
                                    December 31, 2003                           $2,562,025.32
                                    March 31, 2004                              $2,562,025.32
                                    June 30, 2004                               $2,562,025.32
                                    September 30, 2004                          $3,144,303.80
                                    December 31, 2004                           $3,144,303.80
                                    March 31, 2005                              $3,144,303.80
                                    April 30, 2005                              The remaining unpaid principal
                                                                                balance of the Term Loan A

</TABLE>

                  (ii) Each Term Loan B Lender agrees, severally and not
         jointly, to lend to Borrower in one draw on the First Amendment Closing
         Date, its Pro Rata Share of the aggregate amount of $8,000,000.00 (the
         "Term Loan B"). Borrower shall repay the Term Loan B through periodic
         payments on the dates and in the amounts indicated below ("Term Loan B
         Scheduled Installments"). Amounts borrowed under this subsection
         1.1(A)(ii) and repaid may not be reborrowed.

<TABLE>

<S>                                                                             <C>
                                    June 30, 2000                               $20,000.00
                                    September 30, 2000                          $20,000.00
                                    December 31, 2000                           $20,000.00
                                    March 31, 2001                              $20,000.00
                                    June 30, 2001                               $20,000.00
                                    September 30, 2001                          $20,000.00
                                    December 31, 2001                           $20,000.00
                                    March 31, 2002                              $20,000.00
                                    June 30, 2002                               $20,000.00
                                    September 30, 2002                          $20,000.00
                                    December 31, 2002                           $20,000.00
                                    March 31, 2003                              $20,000.00
                                    June 30, 2003                               $20,000.00
                                    September 30, 2003                          $20,000.00
                                    December 31, 2003                           $20,000.00
                                    March 31, 2004                              $20,000.00
                                    June 30, 2004                               $20,000.00
                                    September 30, 2004                          $20,000.00
                                    December 31, 2004                           $20,000.00
                                    March 31, 2005                              $20,000.00

                                        3
<PAGE>

                                    April 30, 2005         The remaining unpaid principal
                                                           balance of the Term Loan B

</TABLE>

                  (c)      Subsection 1.1(E)(ii) is amended by deleting such
subsection in its entirety and inserting the following in lieu thereof:

                  (ii) a Note to evidence each Term Loan, such Notes to be in
                  the principal amount of such Lender's Pro Rata Share of the
                  respective Term Loans

                  (d)      Subsection 1.2(A)(2) is amended by deleting such
subsection in its entirety and inserting the following in lieu thereof:

                  (2)      The Term Loans shall bear interest as follows:

                           (a)      If a Base Rate Loan, then at the sum of the
                  Base Rate PLUS the Base Rate Margin applicable to the
                  respective Term Loan.

                           (b)      If a LIBOR Loan then at the sum of the LIBOR
                  PLUS the LIBOR Margin applicable to the respective Term Loan.

                  (e)      Subsection 1.2(A) is amended by deleting the Pricing
Table appearing in such subsection in its entirety and inserting the following
Pricing Table in lieu thereof:

                                  PRICING TABLE

<TABLE>
<CAPTION>

====================================================================================================================
        Total Indebtedness                 Base Rate            Base               LIBOR               LIBOR
        to Pro Forma EBITDA                  Margin             Rate              Margin               Margin
               Ratio                                           Margin
                                    --------------------------------------------------------------------------------
                                           Revolving            Term             Revolving              Term
                                           Loans and           Loan B            Loans and             Loan B
                                          Term Loan A                           Term Loan A
--------------------------------------------------------------------------------------------------------------------
<S>                                          <C>                <C>                <C>                 <C>
Greater than or equal to                     1.75%              2.25%              3.00%               3.50%
5.50:1
--------------------------------------------------------------------------------------------------------------------
Greater than or equal to                     1.50%              2.00%              2.75%               3.25%
4.75:1 but less than
5.50:1
--------------------------------------------------------------------------------------------------------------------
Greater than or equal to                     1.25%              1.75%              2.50%               3.00%
4.00:1 but less than
4.75:1
--------------------------------------------------------------------------------------------------------------------
Greater than or equal to                     1.00%              1.75%              2.25%               3.00%
3.25:1 but less than
4.00:1
--------------------------------------------------------------------------------------------------------------------
Less than 3.25:1                             0.75%              1.75%              2.00%               3.00%
====================================================================================================================

</TABLE>

                                        4
<PAGE>

                  (f)      Subsection 1.2(G) is amended by deleting the first
two sentences of such subsection in its entirety and inserting the following
sentences in lieu thereof:

         All Loans made on the Closing Date and the Term Loan B made on the
         First Amendment Closing Date shall be Base Rate Loans and remain so for
         three (3) days. Borrower may request that Revolving Loans to be made be
         LIBOR Loans, that outstanding portions of the Term Loans be converted
         to LIBOR Loans and that all or any portion of a LIBOR Loan be continued
         as a LIBOR Loan upon expiration of the applicable Interest Period.

                  (g)      Subsection 1.5(A) is amended by deleting such
subsection in its entirety and inserting the following in lieu thereof:

                           (A)      VOLUNTARY PREPAYMENT OF TERM LOANS. At any
         time, Borrower may prepay the Term Loans, in whole or in part, but with
         LIBOR Breakage Fees, if applicable. Borrower may prepay Term Loan B
         before or on a Pro Rata basis with Term Loan A. Payments shall be
         applied in accordance with subsection 1.5(E) or as otherwise may be
         agreed to by Requisite Lenders.

                  (h)      Section 3 is amended by inserting the following at
the end of said section:

                           3.15     ITS COMPANY RESTRICTIONS. Borrower will not
         at any time permit (i) Cherokee Netherlands I B.V. to engage in any
         line of business or conduct any business operations other than acting
         as a single purpose holding company of the stock of Cherokee
         Netherlands II B.V., nor permit Cherokee Netherlands I B.V. to have any
         Indebtedness or any creditor other than Indebtedness owing to the
         Borrower in accordance with the terms hereof which is subject to the
         Tri-Party Agreement Re: Payment Procedures, (ii) Cherokee Netherlands
         II B.V. to engage in any line of business or conduct any business
         operations other than acting as a single purpose holding company of the
         stock of Cherokee Belgium I, nor permit Cherokee Netherlands II B.V. to
         have any Indebtedness or any creditor other than Indebtedness owing to
         the Cherokee Netherlands I B.V. in accordance with the terms hereof,
         (iii) Cherokee Belgium I to engage in any line of business or conduct
         any business operations other than acting as a single purpose holding
         company of the stock of Industrial and Telecommunications Systems
         S.C.A. and/or Industrial and Telecommunications Systems SPRL, nor
         permit Cherokee Belgium I to have any Indebtedness or any creditor
         other than Indebtedness owing to Cherokee Netherlands II B.V. in
         accordance with the terms hereof. The Borrower will not permit the ITS
         Companies to form or permit to exist any Subsidiary other than those in
         existence on June 15, 2000 and as disclosed to the Banks prior to such
         date. The Borrower will at all times maintain ownership of 100% of the
         capital stock of Cherokee Netherlands I B.V.

                  (i)      Subsection 3.1(B) is deleted in its entirety and the
following is substituted in lieu thereof:

                                        5
<PAGE>

                           (B)      Indebtedness owing: (a) by the Borrower to a
         Subsidiary; (b) by a Domestic Subsidiary to the Borrower or a
         Subsidiary; (c) by a Foreign Subsidiary, other than an ITS Company,
         owing to the Borrower or any Domestic Subsidiary in an aggregate amount
         not to exceed $7,500,000.00; (d) by the ITS Companies owing to
         non-affiliated third parties in an aggregate amount not to exceed
         $5,000,000.00; and (e) in connection with the ITS acquisition, by the
         ITS Companies and Borrower to each other and Borrower, as applicable,
         in an aggregate amount not to exceed $53,000,000.00.

                  (j)      Subsection 3.3 is amended by inserting the following
at the end of said subsection:

                           (L)      Following the First Amendment Closing Date,
         Investments in the ITS Companies not to exceed $3,500,000.00 in the
         aggregate at any time.

                  (k)      Subsection 4.1 is amended by deleting such subsection
in its entirety and inserting the following Subsection in lieu thereof:

                  4.1      CAPITAL EXPENDITURE LIMITS. Borrower shall not permit
the aggregate amount of all Capital Expenditures of Borrower and its
Subsidiaries to exceed (the "Capex Limit"): (i) from the Closing Date through
and including December 31, 1999, $2,100,000.00, (ii) for calendar year 2000,
$5,500,000.00, (iii) for calendar year 2001, $7,000,000.00 plus 10% of the
amount of EBITDA for such calendar year (and NOT on Pro Forma EBITDA) in excess
of $48,000,000.00, and (iv) for each calendar year after 2001, $4,600,000.00
annually plus 10% of the amount of EBITDA for such calendar year (and NOT on Pro
Forma EBITDA) in excess of $48,000,000.00.

                  (l)      Subsection 4.3 is amended by deleting such subsection
in its entirety and inserting the following Subsection in lieu thereof:

                  4.3      FIXED CHARGE COVERAGE. Borrower shall not permit the
Fixed Charge Coverage on the last day of any fiscal quarter ending during any of
the periods set forth below to be less than the Fixed Charge Coverage set forth
below for such period.

<TABLE>
<CAPTION>

                  ------------------------------------------------------------------
                                  PERIOD                        MINIMUM FIXED
                                                               CHARGE COVERAGE
                  ------------------------------------------------------------------
<S>                                                                 <C>
                  Closing Date through                              1.05x
                  12/31/99
                  ------------------------------------------------------------------
                  1/1/00 through 3/31/00                            1.10x
                  ------------------------------------------------------------------
                  4/1/00 through 12/31/01                           1.00x
                  ------------------------------------------------------------------
                  1/1/02 through 9/30/03                            1.05x
                  ------------------------------------------------------------------
                  Thereafter                                        1.10x
                  ------------------------------------------------------------------

</TABLE>

         "Fixed Charge Coverage" will be calculated as illustrated on Exhibit
4.6(D).

                                        6
<PAGE>

                  (m)      Subsection 4.4 is amended by deleting such subsection
in its entirety and inserting the following Subsection in lieu thereof:

                  4.4      TOTAL INTEREST COVERAGE. Borrower shall not permit
the Total Interest Coverage on the last day of any fiscal quarter ending during
any of the periods set forth below to be less than the Total Interest Coverage
set forth below for such period:

<TABLE>
<CAPTION>

                  ------------------------------------------------------------------
                                  PERIOD                        MINIMUM TOTAL
                                                              INTEREST COVERAGE
                  ------------------------------------------------------------------
 <S>                                                                <C>
                  Closing Date through                              1.80x
                  12/31/99
                  ------------------------------------------------------------------
                  1/1/00 - 3/31/00                                  2.10x
                  ------------------------------------------------------------------
                  4/1/00 - 12/31/00                                 1.60x
                  ------------------------------------------------------------------
                  1/1/01 - 6/30/01                                  1.65x
                  ------------------------------------------------------------------
                  7/1/01 - 9/30/01                                  1.75x
                  ------------------------------------------------------------------
                  10/1/01 - 12/31/01                                1.90x
                  ------------------------------------------------------------------
                  1/1/02 - 6/30/02                                  2.20x
                  ------------------------------------------------------------------
                  7/1/02 - 12/31/02                                 2.45x
                  ------------------------------------------------------------------
                  Thereafter                                        2.75x
                  ------------------------------------------------------------------

</TABLE>

         "Total Interest Coverage" will be calculated as illustrated on Exhibit
4.6(D).

                  (n)      Subsection 4.5 is amended by deleting such subsection
in its entirety and inserting the following Subsection in lieu thereof:

                           4.5      TOTAL INDEBTEDNESS TO PRO FORMA EBITDA
RATIO. Borrower shall not permit the Total Indebtedness to Pro Forma EBITDA
Ratio calculated as of the last day of any fiscal quarter for any of the periods
set forth below to be greater than the Total Indebtedness to Pro Forma EBITDA
Ratio set forth below for such period:

<TABLE>
<CAPTION>

                  ----------------------------------------------------------------
                                  PERIOD                        MAXIMUM TOTAL
                                                               INDEBTEDNESS TO
                                                                  PRO FORMA
                                                                EBITDA RATIO
                  ----------------------------------------------------------------
<S>                                                                 <C>
                  Closing through 9/30/99                           5.25x
                  ----------------------------------------------------------------
                  10/1/99 - 12/31/99                                5.00x
                  ----------------------------------------------------------------
                  1/1/00 - 3/31/00                                  4.50x
                  ----------------------------------------------------------------
                  4/1/00 - 6/30/00                                  5.50x
                  ----------------------------------------------------------------
                  7/1/00 - 9/30/00                                  5.35x
                  ----------------------------------------------------------------
                  10/1/00 - 12/31/00                                5.25x
                  ----------------------------------------------------------------
                  1/1/01 - 3/31/01                                  5.15x
                  ----------------------------------------------------------------
                  4/1/01 - 6/30/01                                  4.95x
                  ----------------------------------------------------------------
                  7/1/01 - 9/30/01                                  4.70x
                  ----------------------------------------------------------------
                  10/1/01 - 12/31/01                                4.50x
                  ----------------------------------------------------------------

                                        7
<PAGE>

                  1/1/02 - 3/31/02                                  4.30x
                  ----------------------------------------------------------------
                  4/1/02 - 6/30/02                                  4.10x
                  ----------------------------------------------------------------
                  7/1/02 - 9/30/02                                  3.90x
                  ----------------------------------------------------------------
                  10/1/02 - 12/31/02                                3.75x
                  ----------------------------------------------------------------
                  1/1/03 - 3/31/03                                  3.65x
                  ----------------------------------------------------------------
                  4/1/03 - 6/30/03                                  3.50x
                  ----------------------------------------------------------------
                  7/1/03 - 9/30/03                                  3.35x
                  ----------------------------------------------------------------
                  10/1/03 - 12/31/03                                3.20x
                  ----------------------------------------------------------------
                  Thereafter                                        3.00x
                  ----------------------------------------------------------------

</TABLE>

                  (o)      Subsection 10.1 is amended by inserting the following
definitions in their proper alphabetical order and where, necessary, deleting
the existing definition:

                  "CONSENTING LENDER" or "CONSENTING LENDERS" means each Lender
under the Agreement that consents to and is a signatory to the First Amendment.

                  "FIRST AMENDMENT" means that certain Consent, Waiver and First
Amendment to Credit Agreement dated as of June 15, 2000, entered into by and
between Borrower and Consenting Lenders.

                  "FIRST AMENDMENT CLOSING DATE" means June 15, 2000.

                  "ITS COMPANIES" means those companies formed in connection
with the acquisition of Industrial and Telecommunications Systems S.C.A., a
Belgian company ("ITS OpCo") and Industrial and Telecommunications Systems SPRL,
a Belgian company ("ITS MgmtCo"), including Cherokee Netherlands I B.V.,
Cherokee Netherlands II B.V., and Cherokee Belgium I.

                  "PRO RATA SHARE" means (a) with respect to a Lender's
obligation to lend a portion of the Term Loan A and receive payments of interest
and principal with respect thereto, the percentage obtained by dividing (i) such
Lender's commitment to make a portion of the Term Loan A, as set forth on the
signature page of this Agreement opposite such Lender's signature or in the most
recent Assignment and Acceptance Agreement, if any, executed by such Lender, by
(ii) all such commitments of all Lenders to make the Term Loan A, (b) with
respect to a Lender's obligation to lend a portion of the Term Loan B and
receive payments of interest and principal with respect thereto, the percentage
obtained by dividing (i) such Lender's commitment to make a portion of the Term
Loan B, as set forth on the signature page of the First Amendment opposite such
Lender's signature or in the most recent Assignment and Acceptance Agreement, if
any, executed by such Lender, by (ii) all such commitments of all Lenders to
make the Term Loan B, (c) with respect to a Lender's obligation to make
Revolving Loans and receive payments of interest and principal with respect
thereto (and with respect to the related commitment fee described in subsection
1.2(B)) and with respect to a Lender's obligation to share in Risk Participation
Liability (and with respect to the related Risk Participation Liability fee
described in subsection 1.2(C)), the percentage obtained by dividing (i) such
Lender's commitment to make Revolving Loans, as set forth on the signature page
of this Agreement opposite such Lender's signature or in the most recent
Assignment and Acceptance Agreement, if any, executed by such Lender, by (ii)
all such commitments of all Lenders

                                        8
<PAGE>

to make Revolving Loans and (d) with respect to all other matters (including
without limitation the indemnification obligations arising under subsection
8.2(E)), the percentage obtained by dividing (i) the sum of the then
outstanding portion of the Term Loans which was funded by such Lender, PLUS
the commitment of such Lender to make Revolving Loans, as set forth on the
signature page of this Agreement opposite such Lender's signature or in the
most recent Assignment and Acceptance Agreement, if any, executed by such
Lender, by (ii) the sum of the then outstanding Term Loans, PLUS the
aggregate Revolving Loan Commitment.

                  "SECURITY DOCUMENTS" means all instruments, documents and
agreements executed by or on behalf of any Person to guaranty or provide
collateral security with respect to the Obligations including, without
limitation, any security agreement or pledge agreement, the Tri-Party
Agreement Re: Payment Procedures, any guaranty of the Obligations, any
mortgage or deed of trust, and all instruments, documents and agreements
executed pursuant to the terms of the foregoing.

                  "SCHEDULED INSTALLMENTS" means the Term Loan A Scheduled
Installments and the Term Loan B Scheduled Installments.

                  "TERM LOAN B LENDER" or "TERM LOAN B LENDERS" means each
Lender that lends a portion of the Term Loan B as indicated on the signature
pages attached hereto.

                  "TERM LOANS" means the Term Loan A and the Term Loan B, and
"TERM LOAN" means any one of them.

                  "TRI-PARTY AGREEMENT RE: PAYMENT PROCEDURES" means the that
certain Tri-Party Agreement Re: Payment Procedures among Borrower, Agent and
Cherokee Netherlands I B.V. dated on or about the First Amendment Closing Date,
as from time to time amended or modified in accordance with the terms thereof.

                  (p)      The term "Term Loan" appearing in (i) the definition
of "Total Indebtedness to Pro Forma EBITDA Ratio in Subsection 1.2(A) of the
Credit Agreement, (ii) the final paragraph of Subsection 1.2(A), (iii)
Subsections 1.5(B) through 1.5(E), (iii) Subsection 6.3, (iv) Subsection 6.5,
(v) Subsection 8.1, (vi) Subsection 8.6(B), and (vii) the definitions of "Loan",
"Loans", and "Requisite Lenders" in Subsection 10.1 of the Credit Agreement is
hereby deleted and the phrase "Term Loans" inserted in lieu thereof.

         3.       WAIVERS.          Each of the following waivers is a limited
waiver and shall not be deemed to constitute a waiver of any other Event of
Default or any future breach of the Agreement or any of the other Loan
Documents.

                  (a)      Agent and Consenting Lenders, other than Bank Austria
Creditanstalt Corporate Finance, Inc. ("Bank Austria"), hereby waive the
requirement pursuant to Subsection 1.5(B) that the Borrower make a prepayment of
Excess Cash Flow for the 1999 fiscal year. The preceding sentence
notwithstanding, and pursuant to Subsection 1.5(B), Borrower shall deliver to
Agent, for the account of Bank Austria, an amount equal to Bank Austria's Pro
Rata Share of the Excess Cash Flow prepayment otherwise payable to Bank Austria
for fiscal year 1999 pursuant to

                                        9
<PAGE>

Subsection 1.5(B). Agent and Consenting Lenders hereby agree that such
prepayment shall be applied solely to Bank Austria.

                  (b)      In connection with, and solely limited to, Borrower's
acquisition of ITS and the formation of the various companies in connection
thereto (the "Acquisition"), as contemplated herein, Agent and the Consenting
Lenders hereby waive the following requirements under the Agreement: (i) that
the Borrower make a prepayment pursuant to Subsection 1.5(D) as a result of the
issuance of new securities arising out of the Acquisition; (ii) the restrictions
pursuant to Subsection 3.6(d) on the purchase of all or a substantial part of
the business or assets of a Person, other than Permitted Acquisitions; (iii) the
restrictions pursuant to Subsection 3.8 on transactions with affiliates; and
(iv) the restriction pursuant to Subsection 3.13 on the creation or acquisition
of any new Subsidiary.

         4.       CONSENT. Agent and Lenders hereby consent, subject to the
satisfaction of the conditions described in Section 5 below, to the acquisition
by the Borrower of ITS and the use of proceeds of up to $12,000,000.00 of
Revolving Loans to pay a portion of the purchase price of the Acquisition.

         5.       CONDITIONS. The effectiveness of this Amendment is subject to
the following conditions precedent (unless specifically waived in writing by
Agent):

                  (a)      Borrower and the Requisite Lenders shall have
executed and delivered this Amendment, and such other documents and instruments
as Agent may require shall have been executed and/or delivered to Agent;

                  (b)      All proceedings taken in connection with the
transactions contemplated by this Amendment and all documents, instruments and
other legal matters incident thereto shall be satisfactory to Agent and its
legal counsel;

                  (c)      No Default or Event of Default shall have occurred
and be continuing;

                  (d)      Borrower shall have paid Agent (i) for the benefit of
Consenting Lenders, other than Bank Austria, an amendment fee of .25% of each
Consenting Lender's aggregate commitments as in effect immediately prior to the
execution of this Amendment, (ii) for the benefit of Term Loan B Lenders an
amendment fee in the amount of 1.50% of the amount of Term Loan B, payable to
each Lender based upon its Pro Rata Share of Term Loan B, and (iii) all
expenses, including reasonable attorney's fees, incurred by the Agent in
connection with the preparation, negotiation and execution of this Amendment and
the other documents executed in connection therewith;

                  (e)      The Acquisition shall have been consummated and in
connection therewith the Agent shall have received: (i) a pledge agreement
pledging 65% of the capital stock or similar equity interest, whether
certificated or uncertificated, of Cherokee Netherlands I B.V., (ii) a deed of
pledge pledging 65% of the capital stock or similar equity interest, whether
certificated or uncertificated, of Cherokee Netherlands I B.V., (iii) a pledge
agreement pledging 65% of the capital

                                       10
<PAGE>

stock or similar equity interest, whether certificated or uncertificated, of
Cherokee Netherlands II B.V., (iv) a deed of pledge pledging 65% of the capital
stock or similar equity interest, whether certificated or uncertificated, of
Cherokee Netherlands II B.V., (v) an opinion of Dutch counsel that the Agent has
a perfected first priority security interest in such stock, (vi) an opinion of
Borrower's United States counsel as to the validity and enforceability of this
Amendment and the other documents executed in connection herewith, (vii) a Term
Loan B Note for each Term Loan B Lender, (viii) evidence reasonably satisfactory
to the Agent that the aggregate consideration paid for the Acquisition does not
exceed $55,000,000.00, approximately $34,300,000.00 of which shall have been
contributed in cash by the shareholders of the Borrower, and (ix) an officer's
certificate of the Borrower certifying that the incurrence of the Indebtedness
in connection with the Acquisition does not violate the provisions of that
certain Indenture, dated as of April 30, 1999 (the "Indenture"), by and among
Borrower and Cherokee International Finance, Inc., as Issuers, and Firstar Bank
of Minnesota, N.A., as Trustee. Borrower hereby agrees that Agent's failure to
receive the documents referenced in and pursuant to this Subsection 5(e) via (i)
facsimile on the First Amendment Closing Date and (ii) overnight delivery within
four Business Days of the First Amendment Closing Date will constitute an Event
of Default under the Agreement.

                  (f)      Agent shall receive (a) via facsimile within one day
of the First Amendment Closing Date and (b) via overnight delivery within four
Business Days of the First Amendment Closing Date (i) a pledge agreement
pledging 100% of the membership interests of Borrower owned by OCM/GFI Cherokee
Investments II, Inc., together with an assignment separate from certificate
relating thereto and the original membership interest certificate evidencing
such membership interests, (ii) an opinion from the general counsel of OCM/GFI
Cherokee Investments II, Inc. as to the validity and enforceability of said
pledge agreement and that Agent has a perfected first priority security interest
in such membership interests, (iii) a reliance letter addressed to the Agent
from the seller's Dutch counsel covering the seller's obligations under the ITS
acquisition documents. Borrower hereby agrees that Agent's failure to receive
the documents referenced in and pursuant to this Subsection 5(f) will constitute
an Event of Default under the Agreement, and (iv) delivery of all membership
interest certificates relating to the Pledge Agreements (as defined below) which
evidence the membership interests described on the applicable Exhibits A-1
through A-9 attached hereto .

         6.       REPRESENTATIONS AND WARRANTIES. To induce Agent and Lenders to
enter into this Amendment, Borrower represents and warrants to Agent and
Lenders:

                  (a)      that the execution, delivery and performance of this
Amendment has been duly authorized by all requisite limited liability action on
the part of Borrower and that this Amendment has been duly executed and
delivered by Borrower; and

                  (b)      that, except as set forth on the schedules attached
hereto, each of the representations and warranties set forth in Section 5 of the
Agreement (other than those which, by their terms, specifically are made as of
certain date prior to the date hereof) are true and correct in all material
respects as of the date hereof.

                                       11
<PAGE>

         7.       SEVERABILITY. Any provision of this Amendment held by a court
of competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.

         8.       REFERENCES. Any reference to the Agreement contained in any
document, instrument or agreement executed in connection with the Agreement
shall be deemed to be a reference to the Agreement as modified by this
Amendment.

         9.       COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall constitute an original, but all of which taken
together shall be one and the same instrument.

         10.      RATIFICATION. The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions of
the Agreement and shall not be deemed to be a consent to the modification or
waiver of any other term or condition of the Agreement. Except as expressly
modified and superseded by this Amendment, the terms and provisions of the
Agreement are ratified and confirmed and shall continue in full force and
effect.

         11.      SENIOR INDEBTEDNESS. The Obligations, including, without
limitation, the principal of, and interest on, Term Loan B, shall constitute
"Senior Indebtedness"under the Indenture and the Borrower hereby certifies that
the incurrence of such Indebtedness does not violate the provisions of said
Indenture.

         12.      PLEDGE AGREEMENTS. Reference is hereby made to the following
membership interest pledge agreements dated as of April 30, 1999 relating to the
pledge of membership interests of the Borrower (collectively, the "Pledge
Agreements"):

         a.                Member Interest Pledge Agreement by and between
                           Cherokee Investor Partners and Heller

         b.                Member Interest Pledge Agreement by and between Bikor
                           and Heller

         c.                Member Interest Pledge Agreement by and between
                           Ganpat I. Patel and Manju G. Patel, Trustees of the
                           Patel Family Trust dated July 17, 1987 ("Patel Family
                           Trust") and Heller

         d.                Member Interest Pledge Agreement by and between Rita
                           Patel, Trustee of the Ganpat Patel 1997 Irrevocable
                           Trust I dated November 3, 1997 ("Ganpat Patel Trust
                           I") and Heller

         e.                Member Interest Pledge Agreement by and between Rita
                           Patel, Trustee of the Ganpat Patel 1997 Irrevocable
                           Trust II dated November 3, 1997 ("Ganpat Patel Trust
                           II") and Heller

                                       12
<PAGE>

         f.                Member Interest Pledge Agreement by and between Rita
                           Patel, Trustee of the Ganpat Patel 1997 Irrevocable
                           Trust III dated November 3, 1997 ("Ganpat Patel Trust
                           III") and Heller

         g.                Member Interest Pledge Agreement by and between Rita
                           Patel, Trustee of the Manju Patel 1997 Irrevocable
                           Trust I dated November 3, 1997 ("Manju Patel Trust
                           I") and Heller

         h.                Member Interest Pledge Agreement by and between Rita
                           Patel, Trustee of the Manju Patel 1997 Irrevocable
                           Trust II dated November 3, 1997 ("Manju Patel Trust
                           II") and Heller

         i.                Member Interest Pledge Agreement by and between Rita
                           Patel, Trustee of the Manju Patel 1997 Irrevocable
                           Trust III dated November 3, 1997 and Heller

         As part of the acquisition by the Borrower of the ITS Companies, the
various Pledgors (as such term is defined in the Pledge Agreements) are
modifying their holdings of Pledged Shares (as such term is defined in the
Pledge Agreements). Such Pledged Shares are required to be pledged to the
Pledgee (as defined in the Pledge Agreements). Accordingly, effective as of the
First Amendment Closing Date, a substitute Exhibit A to each Pledge Agreement in
the form attached to this Amendment, as applicable, as Exhibit A-1 through A-9,
reflecting certain changes in the membership ownership of the Pledgors shall
apply to the various Pledge Agreements.

                  [remainder of page intentionally left blank]

                                       13
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed under seal and delivered by their respective duly authorized
officers on the date first written above.

                                     CHEROKEE INTERNATIONAL, LLC

                                     By:  ____________________________________
                                     Name:____________________________________
                                     Title:  _________________________________

Consent, Waiver and First Amendment to Credit Agreement

<PAGE>

                                     HELLER FINANCIAL, INC., as Agent and
                                     Lender

                                     By: ____________________________________
                                     Name:___________________________________
                                     Title: _________________________________

Commitment to make
Term Loan B:
$4,000,000.00

Percentage of Term Loan B:
50.00%

Consent, Waiver and First Amendment to Credit Agreement

                                       15
<PAGE>

                                     FLEET CAPITAL

                                     By: _____________________________________
                                     Name:____________________________________
                                     Title: __________________________________

Commitment to make
Term Loan B:
$2,000,000.00

Percentage of Term Loan B:
25.00%

Consent, Waiver and First Amendment to Credit Agreement

                                       16
<PAGE>

                                     U.S. BANK

                                     By: _____________________________________
                                     Name:____________________________________
                                     Title: __________________________________

Commitment to make
Term Loan B:
$2,000,000.00

Percentage of Term Loan B:
25.00%

Consent, Waiver and First Amendment to Credit Agreement

                                       17
<PAGE>

                                     KEY CORPORATE CAPITAL INC.

                                     By: ____________________________________
                                     Name:___________________________________
                                     Title: _________________________________

Consent, Waiver and First Amendment to Credit Agreement

                                       18
<PAGE>

                                     FINOVA CAPITAL CORPORATION

                                     By: ____________________________________
                                     Name:___________________________________
                                     Title: _________________________________

Consent, Waiver and First Amendment to Credit Agreement

                                       19
<PAGE>

                            CONSENT AND REAFFIRMATION

         The undersigned ("Guarantor") hereby (i) acknowledges receipt of a copy
of the foregoing Consent, Waiver and First Amendment to Credit Agreement; (ii)
consents to Borrower's execution and delivery thereof; (iii) agrees to be bound
thereby; and (iv) affirms that nothing contained therein shall modify in any
respect whatsoever its guaranty of the obligations of Borrower to Agent and
Lenders pursuant to the terms of that certain Guaranty dated April 30, 1999 (the
"Guaranty") and reaffirms that the Guaranty is and shall continue to remain in
full force and effect. Although Guarantor has been informed of the matters set
forth herein and has acknowledged and agreed to same, Guarantor understands that
Agent and Lenders have no obligation to inform Guarantor of such matters in the
future or to seek Guarantor's acknowledgment or agreement to future amendments
or waivers, and nothing herein shall create such a duty.

         IN WITNESS WHEREOF, the undersigned has executed this Consent and
Reaffirmation on and as of the date of such Amendment.

                                    CHEROKEE INTERNATIONAL FINANCE, INC.

                                    By: _______________________________________
                                    Name:______________________________________
                                    Title: ____________________________________

Consent, Waiver and First Amendment to Credit Agreement

                                       20

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