NOTE 7 - FINANCING ARRANGEMENTS AND CONTRACTUAL CASH OBLIGATIONS

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 February 28, 2014. 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 February 28, 2014, 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.

Long-Term Debt

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

	February 28,			February 28,
	2014			2013
Bank term loan	$	-		$	1,800
Note payable to Navman		1,858			2,895
		1,858			4,695
Less portion due within one year		(1,156	)		(2,261	)
Long-term debt	$	702		$	2,434

The Navman note is payable in the form of a 15% rebate on certain products sold by the Company to Navman under the Supply Agreement. The unpaid balance of the Navman note would become immediately due and payable upon any termination of the Supply Agreement by the Company before the end of its five-year term (other than as a result of an uncured breach of the Supply Agreement by Navman), except that in the case of such acceleration the note balance would be subordinated to the Company's bank debt pursuant to the provisions of a debt subordination agreement. In the absence of an acceleration event, the Navman note is payable solely in the form of a rebate on products sold by CalAmp to Navman under the Supply Agreement. After all rebates have been applied to pay down the note balance, and assuming that an acceleration event has not occurred, any unpaid balance remaining on the Navman note would be forgiven at the later of May 7, 2017 or the final date to which the Supply Agreement is extended pursuant to a force majeure event. The Company made principal payments on the note of $1,308,000 and $535,000 in fiscal 2014 and 2013, respectively.

Other Non-Current Liabilities

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

	February 28,		February 28,
	2014		2013
Deferred revenue	$	1,977	$	1,285
Acquisition-related contingent consideration		1,092		303
Deferred compensation		131		-
Deferred rent		97		251
	$	3,298	$	1,839

The acquisition-related contingent consideration at February 28, 2014 is primarily comprised of the $1,034,000 non-current portion of the total estimated earn-out of $2,098,000 payable to RSI (see Note 2 - Acquisitions). The remainder of $58,000 represents the non-current portion of the total balance of $662,000 contingent consideration associated with the Navman product line acquisition, which is payable at approximately 15% of the revenue from the sale by CalAmp of certain products acquired from Navman under the Asset Purchase Agreement during the first three years. The Company made royalty payments to Navman of $271,000 in fiscal 2014.

Contractual Cash Obligations

Following is a summary of the Company's contractual cash obligations as of February 28, 2014 and excludes amounts already recorded on the consolidated balance sheets except for long-term debt (in thousands):

	Future Estimated Cash Payments Due by Fiscal Year
Contractual Obligations	2015		2016		2017		2018		2019		Thereafter		Total
Note payable to Navman	$	1,275	$	882	$	-	$	-	$	-	$	-	$	2,157
Operating leases		1,687		2,114		1,763		1,569		1,515		819		9,467
Purchase obligations		44,204		-		-		-		-		-		44,204
Total contractual obligations	$	47,166	$	2,996	$	1,763	$	1,569	$	1,515	$	819	$	55,828

Purchase obligations consist primarily of inventory purchase commitments. Rent expense under operating leases was $1,886,000, $1,707,000 and $1,566,000 in fiscal years 2014, 2013 and 2012, respectively.