NOTE 5 - FINANCING ARRANGEMENTS

Bank Credit Facility

On March 1, 2013, the Company and Square 1 Bank entered into the Eighth Amendment (the "Eighth Amendment") to the Loan and Security Agreement dated as of December 22, 2009 (as amended by the Eighth Amendment, the "Amended Loan Agreement"). The Eighth Amendment increased the maximum credit limit of the facility from $12 million to $15 million, lowered the interest rate on outstanding borrowings from prime plus 1.0% to prime, and extended the facility maturity date from August 15, 2014 to March 1, 2017. Interest is payable on the last day of each calendar month. The Eighth Amendment provided for a new $5 million term loan (the "New Term Loan") that was fully funded on March 4, 2013. Concurrent with funding the New Term Loan, the pre-existing term loan with an outstanding principal balance of $1.8 million was retired. Principal of the New Term Loan was repayable at the rate of $83,333 per month beginning April 2013. The Company repaid the term loan in full in October 2013. The revolver portion of the Amended Loan Agreement has a borrowing limit equal to the lesser of (a) $15 million minus the term loan principal outstanding at any point in time, or (b) 85% of eligible accounts receivable. There were no borrowings outstanding on the revolver at November 30, 2013. The Company agreed to pay loan fees to Square 1 Bank in connection with the Eighth Amendment of $7,500 on the first anniversary and $37,500 on each of the next three anniversaries of the New Term Loan.

The Amended Loan Agreement contains financial covenants that require the Company to maintain a minimum level of earnings before interest, income taxes, depreciation, amortization and other noncash charges ("EBITDA") and a minimum debt coverage ratio, both measured monthly beginning March 2013 on a rolling 12-month basis. At November 30, 2013, the Company was in compliance with its debt covenants under the credit facility. The credit facility also provides for a number of customary events of default, including a provision that a material adverse change constitutes an event of default that permits the lender, at its option, to accelerate the loan. Among other provisions, the credit facility requires a lock-box and cash collateral account whereby cash remittances from the Company's customers are directed to the cash collateral account and which amounts are applied to reduce, if applicable, the outstanding revolving loan principal.

Navman Note Payable

In connection with the acquisition of a product line from Navman Wireless ("Navman") in May 2012, the Company issued a non-interest bearing note payable to Navman in the original face amount of $4,000,000 and a present value at the time of issuance of $3,080,000. The note is payable in the form of a 15% rebate on certain products sold by the Company to Navman under a five-year supply agreement that was entered into concurrently with the product line acquisition.

Long-Term Debt

Long-term debt is comprised of the following (in thousands):

	November 30,			February 28,
	2013			2013
Bank term loan	$	-		$	1,800
Note payable to Navman, net of unamortized discount		2,369			2,895
		2,369			4,695
Less portion due within one year		(1,238	)		(2,261	)
Long-term debt	$	1,131		$	2,434

Other Non-Current Liabilities

Other non-current liabilities consist of the following (in thousands):

	November 30,		February 28,
	2013		2013
Deferred rent	$	185	$	251
Deferred revenue		1,787		1,285
Other		321		303
	$	2,293	$	1,839