UNITED
STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the quarterly period ended August 31, 2014 | ||
or | ||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
COMMISSION FILE NUMBER:
0-12182
________________
CALAMP CORP.
(Exact name of Registrant as
specified in its Charter)
Delaware | 95-3647070 |
(State or other jurisdiction of | (I.R.S. Employer |
incorporation or organization) | Identification No.) |
1401 N. Rice Avenue | |
Oxnard, California | 93030 |
(Address of principal executive offices) | (Zip Code) |
(805)
987-9000
(Registrants
telephone number, including area
code)
________________
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
Large accelerated filer o | Accelerated filer x |
Non-accelerated filer o | Smaller reporting company o |
(Do not check if a smaller reporting company) |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
The number of shares outstanding of the registrants common stock as of September 17, 2014 was 36,176,599.
CALAMP
CORP.
CONSOLIDATED BALANCE
SHEETS (Unaudited)
(IN THOUSANDS, EXCEPT PAR VALUE)
August 31, | February 28, | |||||||
Assets | 2014 | 2014 | ||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 23,296 | $ | 19,233 | ||||
Short-term marketable securities | 13,548 | 8,500 | ||||||
Accounts receivable, less allowance for doubtful accounts of | ||||||||
$618 and $761 at August 31, 2014 and February 28, 2014, respectively | 38,277 | 36,904 | ||||||
Inventories | 20,175 | 14,968 | ||||||
Deferred income tax assets | 7,508 | 7,619 | ||||||
Prepaid expenses and other current assets | 4,317 | 5,017 | ||||||
Total current assets | 107,121 | 92,241 | ||||||
Long-term marketable securities | - | 518 | ||||||
Property, equipment and improvements, net of | ||||||||
accumulated depreciation and amortization | 6,795 | 4,771 | ||||||
Deferred income tax assets, less current portion | 31,858 | 35,131 | ||||||
Goodwill | 15,479 | 15,422 | ||||||
Other intangible assets, net | 25,833 | 29,131 | ||||||
Other assets | 3,742 | 2,051 | ||||||
$ | 190,828 | $ | 179,265 | |||||
Liabilities and Stockholders' Equity | ||||||||
Current liabilities: | ||||||||
Current portion of long-term debt | $ | 862 | $ | 1,156 | ||||
Accounts payable | 28,725 | 20,508 | ||||||
Accrued payroll and employee benefits | 4,207 | 6,594 | ||||||
Deferred revenue | 8,405 | 8,251 | ||||||
Other current liabilities | 5,507 | 5,609 | ||||||
Total current liabilities | 47,706 | 42,118 | ||||||
Long-term debt | 238 | 702 | ||||||
Other non-current liabilities | 4,482 | 3,298 | ||||||
Commitments and contingencies | ||||||||
Stockholders' equity: | ||||||||
Preferred stock, $.01 par value; 3,000 shares authorized; | ||||||||
no shares issued or outstanding | - | - | ||||||
Common stock, $.01 par value; 80,000 shares authorized; | ||||||||
36,177 and 35,859 shares issued and outstanding | ||||||||
at August 31, 2014 and February 28, 2014, respectively | 362 | 359 | ||||||
Additional paid-in capital | 205,435 | 206,154 | ||||||
Accumulated deficit | (67,330 | ) | (73,301 | ) | ||||
Accumulated other comprehensive loss | (65 | ) | (65 | ) | ||||
Total stockholders' equity | 138,402 | 133,147 | ||||||
$ | 190,828 | $ | 179,265 |
See accompanying notes to consolidated financial statements.
2
CALAMP
CORP.
CONSOLIDATED INCOME
STATEMENTS (Unaudited)
(IN THOUSANDS, EXCEPT PER SHARE
AMOUNTS)
Three Months Ended | Six Months Ended | |||||||||||||||
August 31, | August 31, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Revenues: | ||||||||||||||||
Products | $ | 49,015 | $ | 48,831 | $ | 98,458 | $ | 92,914 | ||||||||
Application subscriptions and other services | 10,195 | 9,976 | 19,733 | 19,639 | ||||||||||||
Total revenues | 59,210 | 58,807 | 118,191 | 112,553 | ||||||||||||
Cost of revenues: | ||||||||||||||||
Products | 33,864 | 35,166 | 68,589 | 66,611 | ||||||||||||
Application subscriptions and other services | 4,850 | 3,802 | 8,887 | 7,622 | ||||||||||||
Total cost of revenues | 38,714 | 38,968 | 77,476 | 74,233 | ||||||||||||
Gross profit | 20,496 | 19,839 | 40,715 | 38,320 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 5,016 | 5,296 | 10,134 | 10,454 | ||||||||||||
Selling | 4,921 | 4,884 | 10,098 | 9,869 | ||||||||||||
General and administrative | 3,892 | 3,418 | 7,529 | 7,230 | ||||||||||||
Intangible asset amortization | 1,634 | 1,484 | 3,317 | 3,133 | ||||||||||||
Total operating expenses | 15,463 | 15,082 | 31,078 | 30,686 | ||||||||||||
Operating income | 5,033 | 4,757 | 9,637 | 7,634 | ||||||||||||
Non-operating expense: | ||||||||||||||||
Interest income (expense), net | 5 | (87 | ) | (96 | ) | (209 | ) | |||||||||
Other income (expense) | (9 | ) | 6 | 5 | (41 | ) | ||||||||||
Total non-operating expense | (4 | ) | (81 | ) | (91 | ) | (250 | ) | ||||||||
Income before income taxes | 5,029 | 4,676 | 9,546 | 7,384 | ||||||||||||
Income tax provision | (1,751 | ) | (1,832 | ) | (3,575 | ) | (2,855 | ) | ||||||||
Net income | $ | 3,278 | $ | 2,844 | $ | 5,971 | $ | 4,529 | ||||||||
Earnings per share: | ||||||||||||||||
Basic | $ | 0.09 | $ | 0.08 | $ | 0.17 | $ | 0.13 | ||||||||
Diluted | $ | 0.09 | $ | 0.08 | $ | 0.16 | $ | 0.13 | ||||||||
Shares used in computing earnings per share: | ||||||||||||||||
Basic | 35,732 | 34,808 | 35,652 | 34,687 | ||||||||||||
Diluted | 36,472 | 35,833 | 36,498 | 35,748 |
See accompanying notes to consolidated financial statements.
3
CALAMP
CORP.
CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)
(IN THOUSANDS)
Six Months Ended | ||||||||
August 31, | ||||||||
2014 | 2013 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income | $ | 5,971 | $ | 4,529 | ||||
Adjustments to reconcile net income | ||||||||
to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 4,368 | 4,015 | ||||||
Stock-based compensation expense | 1,756 | 1,321 | ||||||
Amortization of debt issue costs and discount | 280 | 147 | ||||||
Deferred tax assets, net | 3,384 | 2,796 | ||||||
Other | 42 | - | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (1,418 | ) | (2,976 | ) | ||||
Inventories | (5,219 | ) | (567 | ) | ||||
Prepaid expenses and other assets | (1,001 | ) | 38 | |||||
Accounts payable | 8,217 | 7,716 | ||||||
Accrued liabilities | (742 | ) | (3,497 | ) | ||||
Deferred revenue | 154 | 288 | ||||||
NET CASH PROVIDED BY OPERATING ACTIVITIES | 15,792 | 13,810 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Purchases of marketable securities | (6,514 | ) | - | |||||
Proceeds from maturities of marketable securities | 1,942 | - | ||||||
Capital expenditures | (3,094 | ) | (841 | ) | ||||
Acquisition net of cash acquired | - | (46,837 | ) | |||||
NET CASH USED IN INVESTING ACTIVITIES | (7,666 | ) | (47,678 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from bank term loan, net of repayments | - | 2,783 | ||||||
Payment of acquisition-related note and contingent consideration | (1,591 | ) | (486 | ) | ||||
Taxes paid related to net share settlement of vested equity awards | (3,013 | ) | (2,991 | ) | ||||
Proceeds from exercise of stock options | 541 | 1,139 | ||||||
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES | (4,063 | ) | 445 | |||||
Net change in cash and cash equivalents | 4,063 | (33,423 | ) | |||||
Cash and cash equivalents at beginning of period | 19,233 | 63,101 | ||||||
Cash and cash equivalents at end of period | $ | 23,296 | $ | 29,678 |
See accompanying notes to consolidated financial statements.
4
CALAMP
CORP.
NOTES TO UNAUDITED
CONSOLIDATED FINANCIAL STATEMENTS
SIX MONTHS ENDED AUGUST 31, 2014 AND 2013
NOTE 1 - DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Description of Business
CalAmp Corp. ("CalAmp" or the "Company") is a leading provider of wireless communications solutions for a broad array of applications to customers globally. The Companys business activities are organized into its Wireless DataCom and Satellite business segments.
The Company uses a 52-53 week fiscal year ending on the Saturday closest to February 28, which for fiscal 2014, a 52-week year, fell on March 1, 2014. The actual interim periods presented herein ended on August 30, 2014 and August 31, 2013, both consisting of 13 weeks. In the accompanying unaudited consolidated financial statements, the 2014 fiscal year end is shown as February 28 and the interim period end for both years is shown as August 31 for clarity of presentation.
Certain notes and other information are condensed or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these financial statements should be read in conjunction with the Company's 2014 Annual Report on Form 10-K as filed with the Securities and Exchange Commission on April 24, 2014.
In the opinion of the Company's management, the accompanying unaudited consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary to present fairly the Company's financial position at August 31, 2014 and its results of operations for the three and six months ended August 31, 2014 and 2013. The results of operations for such periods are not necessarily indicative of results to be expected for the full fiscal year.
All significant intercompany transactions and accounts have been eliminated in consolidation.
Revenue Recognition
The Company recognizes revenue from product sales when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable and collection of the sales price is reasonably assured. Generally, these criteria are met at the time product is shipped, except for shipments made on the basis of "FOB Destination" terms, in which case title transfers to the customer and the revenue is recorded by the Company when the shipment reaches the customer. Customers generally do not have rights of return except for defective products returned during the warranty period. In the limited number of instances where customers have a right of return period, revenue is not recognized until the expiration of such period. The Company records estimated commitments related to customer incentive programs as reductions of revenues.
The Company provides Software as a Service (SaaS) subscriptions for its fleet management and vehicle finance applications in which customers are provided with the ability to wirelessly communicate with monitoring devices installed in vehicles and other mobile assets via software applications hosted by the Company. The Company defers the recognition of revenue for the monitoring device products that are sold with application subscriptions because the application services are essential to the functionality of the products, and accordingly, the associated product costs are recorded as deferred costs in the balance sheet. The deferred product revenue and deferred product cost amounts are amortized to application subscriptions revenue and cost of revenue on a straight-line basis over the minimum contractual service periods of one year to three years. Revenues from renewals of data communication services after the initial one year term are recognized as application subscriptions revenue when the services are provided. When customers prepay application subscription renewals, such amounts are recorded as deferred revenues and are recognized over the renewal term.
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Cash and Cash Equivalents
The Company considers all highly liquid investments with remaining maturities at date of purchase of three months or less to be cash equivalents.
Fair Value Measurements
The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly manner in an arms-length transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
Level 1 Quoted prices in active markets for identical assets or liabilities.
Level 2 Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 Inputs that are generally unobservable and typically reflect managements estimate of assumptions that market participants would use in pricing the asset or liability.
In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has elected the fair value option for its investment in marketable securities on contract-by-contract basis at the time each contract is initially recognized in the financial statements.
Reclassifications
Certain amounts in the financial statements of prior year have been reclassified to conform to the fiscal 2015 presentation, with no effect on net income.
NOTE 2 FINANCIAL INSTRUMENTS
Cash, Cash Equivalents and Marketable Securities
The following table summarizes the Companys cash and marketable securities as of August 31, 2014 using the hierarchy described in Note 1 under the heading Fair Value Measurements (in thousands):
Balance Sheet Classification | |||||||||||||||
of Fair Value | |||||||||||||||
Unrealized | Cash and | Short-Term | |||||||||||||
Adjusted | Gains | Fair | Cash | Marketable | |||||||||||
Cost | (Losses) | Value | Equivalents | Securities | |||||||||||
Cash | $ | 13,897 | $ | - | $ | 13,897 | $ | 13,897 | $ | - | |||||
Level 1: | |||||||||||||||
Money market funds | 399 | - | 399 | 399 | - | ||||||||||
Level 2: | |||||||||||||||
U.S. Treasury securities | 1,000 | - | 1,000 | - | 1,000 | ||||||||||
Certificates of deposit | 500 | - | 500 | - | 500 | ||||||||||
Repurchase agreements | 9,000 | - | 9,000 | 9,000 | - | ||||||||||
Commercial paper | 12,048 | - | 12,048 | - | 12,048 | ||||||||||
Total | $ | 36,844 | $ | - | $ | 36,844 | $ | 23,296 | $ | 13,548 |
6
NOTE 3 - INVENTORIES
Inventories consist of the following (in thousands):
August 31, | February 28, | |||||
2014 | 2014 | |||||
Raw materials | $ | 16,332 | $ | 12,410 | ||
Work in process | 563 | 380 | ||||
Finished goods | 3,280 | 2,178 | ||||
$ | 20,175 | $ | 14,968 |
NOTE 4 GOODWILL AND OTHER INTANGIBLE ASSETS
Changes in goodwill are as follows (in thousands):
Six Months Ended | ||||||
August 31, | ||||||
2014 | 2013 | |||||
Balance at beginning of period | $ | 15,422 | $ | 1,112 | ||
Wireless Matrix acquisition | - | 17,192 | ||||
Purchase price allocation adjustments | 57 | - | ||||
Balance at end of period | $ | 15,479 | $ | 18,304 |
Other intangible assets are comprised as follows (in thousands):
August 31, 2014 | February 28, 2014 | |||||||||||||||||||
Gross | Gross | |||||||||||||||||||
Amortization | Carrying | Accumulated | Carrying | Accumulated | ||||||||||||||||
Period | Amount | Amortization | Net | Amount | Amortization | Net | ||||||||||||||
Supply contract | 5 years | $ | 2,220 | $ | 1,025 | $ | 1,195 | $ | 2,220 | $ | 803 | $ | 1,417 | |||||||
Developed/core technology | 2-7 years | 16,151 | 6,030 | 10,121 | 16,151 | 4,886 | 11,265 | |||||||||||||
Tradename | 7 years | 2,130 | 1,065 | 1,065 | 2,130 | 913 | 1,217 | |||||||||||||
Customer lists | 5-7 years | 19,438 | 6,171 | 13,267 | 19,438 | 4,394 | 15,044 | |||||||||||||
Covenants not to compete | 5 years | 262 | 170 | 92 | 262 | 153 | 109 | |||||||||||||
Patents | 5 years | 140 | 47 | 93 | 121 | 42 | 79 | |||||||||||||
$ | 40,341 | $ | 14,508 | $ | 25,833 | $ | 40,322 | $ | 11,191 | $ | 29,131 |
All intangible asset amortization expense was attributable to the Wireless DataCom business. Estimated future amortization expense for the fiscal years ending February 28 is as follows (in thousands):
Fiscal Year | |||
2015 (remainder) | $ | 3,275 | |
2016 | 6,549 | ||
2017 | 6,549 | ||
2018 | 6,047 | ||
2019 | 2,733 | ||
Thereafter | 680 | ||
$ | 25,833 |
7
NOTE 5 - FINANCING ARRANGEMENTS
Bank Credit Facility
The Company has a credit facility with Square 1 Bank that provides for borrowings up to $15 million or 85% of eligible accounts receivable, whichever is less. The credit facility expires on March 1, 2017. Borrowings under this line of credit bear interest at the banks prime rate. There were no borrowings outstanding under this credit facility at August 31, 2014 or February 28, 2014.
The Square 1 Bank credit facility 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 on a rolling 12-month basis. At August 31, 2014, the Company was in compliance with its debt covenants under the credit facility.
Long-Term Debt
Long-term debt is comprised of the following (in thousands):
August 31, | February 28, | |||||||
2014 | 2014 | |||||||
Note payable to Navman, net of unamortized discount | $ | 1,100 | $ | 1,858 | ||||
Less portion due within one year | (862 | ) | (1,156 | ) | ||||
Long-term debt | $ | 238 | $ | 702 |
The Navman Wireless (Navman) note is payable in the form of a 15% rebate on certain products sold by CalAmp to Navman under a five-year $25 million supply agreement (the Supply Agreement) that was entered into in May 2012 in conjunction with CalAmps purchase of a product line from Navman. 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 Companys 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. During the six months ended August 31, 2014, the Company made principal payments of $912,000 and amortized $154,000 of the discount on the Navman note.
Other Non-Current Liabilities
Other non-current liabilities consist of the following (in thousands):
August 31, | February 28, | |||||
2014 | 2014 | |||||
Deferred revenue | $ | 1,863 | $ | 1,977 | ||
Acquisition-related contingent consideration | 524 | 1,092 | ||||
Deferred compensation | 1,786 | 131 | ||||
Deferred rent | 309 | 98 | ||||
$ | 4,482 | $ | 3,298 |
The acquisition-related contingent consideration at August 31, 2014 is comprised of the $524,000 non-current portion of the total estimated remaining earn-out of $1,761,000 payable to the sellers in conjunction with the December 2013 acquisition of Radio Satellite Integrators, Inc.
In August 2013, the Company adopted a non-qualified deferred compensation plan in which the executive officers and certain other management employees are eligible to participate whereby such officers and employees may defer a portion of their annual base and/or variable compensation until retirement or a date specified by the employee in accordance with the plan. Deferred compensation plan assets and liabilities as of August 31, 2014 were approximately $1,768,000 and $1,786,000, respectively, and are included in other assets and other non-current liabilities in the accompanying consolidated balance sheet at that date. Effective July 1, 2014, the plan was amended to include restricted stock units as a deferrable form of compensation and to allow non-employee directors to participate in the plan.
8
NOTE 6 - INCOME TAXES
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and for income tax purposes. The Company evaluates the realizability of its deferred income tax assets and a valuation allowance is provided, as necessary. In assessing this valuation allowance, the Company reviews historical and future expected operating results and other factors, including its recent cumulative earnings experience, expectations of future taxable income by taxing jurisdiction and the carryforward periods available for tax reporting purposes, to determine whether it is more likely than not that deferred tax assets are realizable.
The Company files income tax returns in the U.S. federal jurisdiction, various U.S. states, Canada, the United Kingdom and New Zealand. Income tax returns filed for fiscal years 2009 and earlier are not subject to examination by U.S. federal and state tax authorities. Certain income tax returns for fiscal years 2010 through 2013 remain open to examination by U.S. federal and state tax authorities. Income tax returns for fiscal years 2010 through 2013 remain open to examination by tax authorities in Canada. The Company believes that it has made adequate provision for all income tax uncertainties pertaining to these open tax years.
The effective income tax rate was 37.5% and 38.7% in the six months ended August 31, 2014 and 2013, respectively.
NOTE 7 - EARNINGS PER SHARE
Basic earnings per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period, plus the dilutive effect of outstanding stock options and restricted stock-based awards using the treasury stock method. The following table sets forth the composition of weighted average shares used in the computation of basic and diluted earnings per share (in thousands):
Three Months Ended | Six Months Ended | |||||||
August 31, | August 31, | |||||||
2014 | 2013 | 2014 | 2013 | |||||
Basic weighted average number of common | ||||||||
shares outstanding | 35,732 | 34,808 | 35,652 | 34,687 | ||||
Effect of stock options, restricted stock and restricted | ||||||||
stock units computed on treasury stock method | 740 | 1,025 | 846 | 1,061 | ||||
Diluted weighted average number of common | ||||||||
shares outstanding | 36,472 | 35,833 | 36,498 | 35,748 |
Shares underlying stock options of 157,000 and 65,000 at August 31, 2014 and August 31, 2013, respectively, were excluded from the calculations of diluted earnings per share for the three and six month periods then ended because based on the exercise prices of these derivative securities their inclusion would have been anti-dilutive under the treasury stock method.
9
NOTE 8 STOCK-BASED COMPENSATION
Stock-based compensation expense is included in the following captions of the unaudited consolidated income statements (in thousands):
Three Months Ended | Six Months Ended | |||||||||||
August 31, | August 31, | |||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
Cost of revenues | $ | 58 | $ | 42 | $ | 110 | $ | 81 | ||||
Research and development | 148 | 122 | 283 | 232 | ||||||||
Selling | 126 | 87 | 239 | 158 | ||||||||
General and administrative | 604 | 439 | 1,124 | 850 | ||||||||
$ | 936 | $ | 690 | $ | 1,756 | $ | 1,321 |
Changes in the Company's outstanding stock options during the six months ended August 31, 2014 were as follows (options in thousands):
Weighted | ||||||
Number of | Average | |||||
Options | Exercise Price | |||||
Outstanding at February 28, 2014 | 1,093 | $ | 5.04 | |||
Granted | 61 | 17.47 | ||||
Exercised | (111 | ) | 4.89 | |||
Forfeited or expired | (2 | ) | 7.53 | |||
Outstanding at August 31, 2014 | 1,041 | $ | 5.78 | |||
Exercisable at August 31, 2014 | 867 | $ | 4.55 |
Changes in the Company's outstanding restricted stock shares and restricted stock units (RSUs) during the six months ended August 31, 2014 were as follows (shares and RSUs in thousands):
Weighted | ||||||
Number of | Average Grant | |||||
Shares and | Date Fair | |||||
RSUs | Value | |||||
Outstanding at February 28, 2014 | 1,024 | $ | 8.02 | |||
Granted | 329 | 17.86 | ||||
Vested | (459 | ) | 5.98 | |||
Forfeited | (17 | ) | 10.30 | |||
Outstanding at August 31, 2014 | 877 | $ | 12.74 |
During the six months ended August 31, 2014, the Company retained 171,256 shares of the vested restricted stock and RSUs to satisfy the minimum required statutory amount of employee withholding taxes.
As of August 31, 2014, there was $11.9 million of total unrecognized stock-based compensation cost related to nonvested stock options, restricted stock and RSUs that is expected to be recognized as an expense over a weighted-average remaining vesting period of 3.1 years.
10
NOTE 9 - CONCENTRATION OF RISK
Because the Company sells into markets dominated by a few large service providers, a significant percentage of consolidated revenues and consolidated accounts receivable relate to a small number of customers. One customer of the Company's Satellite business unit accounted for 15% and 20% of consolidated revenues for the quarters ended August 31, 2014 and 2013, respectively, and accounted for 17% and 22% of consolidated revenues for the respective six-month periods then ended. This customer accounted for 13% and 15% of consolidated net accounts receivable at August 31, 2014 and February 28, 2014, respectively.
A substantial portion of the Companys inventory is purchased from one supplier which functions as an independent foreign procurement agent and contract manufacturer. This supplier accounted for 60% and 64% of Company's total inventory purchases in the six months ended August 31, 2014 and 2013, respectively. As of August 31, 2014, this supplier accounted for 59% of the Company's total accounts payable.
Some of the Company's components, assemblies and electronic manufacturing services are purchased from sole source suppliers.
NOTE 10 - PRODUCT WARRANTIES
The Company generally warrants its products against defects over periods ranging from 3 to 24 months. An accrual for estimated future costs relating to products returned under warranty is recorded as an expense when products are shipped. At the end of each quarter, the Company adjusts its liability for warranty claims based on its actual warranty claims experience as a percentage of revenues for the preceding 12 to 24 months and also considers the impact of the known operational issues that may have a greater impact than historical trends. Accrued warranty costs are included in other current liabilities in the consolidated balance sheets. Activity in the accrued warranty costs liability for the six months ended August 31, 2014 and 2013 is as follows (in thousands):
Six Months Ended | ||||||||
August 31, | ||||||||
2014 | 2013 | |||||||
Balance at beginning of period | $ | 1,516 | $ | 1,328 | ||||
Charged to costs and expenses | 792 | 438 | ||||||
Deductions | (496 | ) | (256 | ) | ||||
Balance at end of period | $ | 1,812 | $ | 1,510 |
NOTE 11 OTHER FINANCIAL INFORMATION
"Net cash provided by operating activities" in the unaudited consolidated statements of cash flows includes cash payments for interest and income taxes as follows (in thousands):
Six Months Ended | ||||||
August 31, | ||||||
2014 | 2013 | |||||
Interest expense paid | $ | 4 | $ | 70 | ||
Income tax paid | $ | 240 | $ | 36 |
11
NOTE 12 - SEGMENT INFORMATION
Segment information for the three and six months ended August 31, 2014 and 2013 is as follows (dollars in thousands):
Three Months Ended August 31, 2014 | Three Months Ended August 31, 2013 | |||||||||||||||||||||||||||||||
Operating Segments | Operating Segments | |||||||||||||||||||||||||||||||
Wireless | Corporate | Wireless | Corporate | |||||||||||||||||||||||||||||
DataCom | Satellite | Expenses | Total | DataCom | Satellite | Expenses | Total | |||||||||||||||||||||||||
Revenues | $ | 50,204 | $ | 9,006 | $ | 59,210 | $ | 47,196 | $ | 11,611 | $ | 58,807 | ||||||||||||||||||||
Gross profit | $ | 18,047 | $ | 2,449 | $ | 20,496 | $ | 17,555 | $ | 2,284 | $ | 19,839 | ||||||||||||||||||||
Gross margin | 35.9 | % | 27.2 | % | 34.6 | % | 37.2 | % | 19.7 | % | 33.7 | % | ||||||||||||||||||||
Operating income | $ | 4,657 | $ | 1,300 | $ | (924 | ) | $ | 5,033 | $ | 4,314 | $ | 1,228 | $ | (785 | ) | $ | 4,757 | ||||||||||||||
Six Months Ended August 31, 2014 | Six Months Ended August 31, 2013 | |||||||||||||||||||||||||||||||
Operating Segments | Operating Segments | |||||||||||||||||||||||||||||||
Wireless | Corporate | Wireless | Corporate | |||||||||||||||||||||||||||||
DataCom | Satellite | Expenses | Total | DataCom | Satellite | Expenses | Total | |||||||||||||||||||||||||
Revenues | $ | 98,051 | $ | 20,140 | $ | 118,191 | $ | 88,061 | $ | 24,492 | $ | 112,553 | ||||||||||||||||||||
Gross profit | $ | 35,362 | $ | 5,353 | $ | 40,715 | $ | 33,515 | $ | 4,805 | $ | 38,320 | ||||||||||||||||||||
Gross margin | 36.1 | % | 26.6 | % | 34.4 | % | 38.1 | % | 19.6 | % | 34.0 | % | ||||||||||||||||||||
Operating income | $ | 8,325 | $ | 3,156 | $ | (1,844 | ) | $ | 9,637 | $ | 6,680 | $ | 2,776 | $ | (1,822 | ) | $ | 7,634 |
The Company considers operating income to be the primary measure of operating performance of its business segments. The amount shown for each period in the "Corporate Expenses" column above consists of expenses that are not allocated to the business segments. These non-allocated corporate expenses include salaries and benefits of certain corporate staff and expenses such as audit fees, investor relations, stock listing fees, director and officer liability insurance, and director fees and expenses. Corporate expenses include stock-based compensation expense of $185,000 and $142,000 in the three-month periods ended August 31, 2014 and 2013, respectively, and $338,000 and $284,000, respectively, in the six-month periods then ended.
NOTE 13 - COMMITMENTS AND CONTINGENCIES
Legal Proceedings
In December 2013, a patent infringement lawsuit was filed against the Company. The lawsuit contends that certain of the Companys vehicle tracking products infringe on the patents held by the plaintiff and seeks injunctive and monetary relief. The Company believes that it has various offensive claims against the plaintiff, and intends to vigorously defend against this action. While the outcome of this matter is currently not determinable, management does not expect that the ultimate cost to resolve this matter will have a material adverse effect on the Companys consolidated financial position or results of operations. The Companys assessment of materiality may change in the future based upon availability of discovery and further developments in any matters. No loss accrual has been made in the accompanying consolidated financial statements for this matter.
In addition to the foregoing matter, from time to time as a normal consequence of doing business, various claims and litigation may be asserted or commenced against the Company. In particular, the Company in the ordinary course of business may receive claims concerning contract performance, or claims that its products or services infringe the intellectual property of third parties. While the outcome of any such claims or litigation cannot be predicted with certainty, management does not believe that the outcome of any of such matters existing at the present time would have a material adverse effect on the Company's consolidated financial position or results of operations.
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ITEM 2. | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
The Company's discussion and analysis of its financial condition and results of operations are based upon the Company's consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues, costs and expenses during the reporting periods. Actual results could differ materially from these estimates. The critical accounting policies listed below involve the Companys more significant accounting judgments and estimates that are used in the preparation of the consolidated financial statements. These policies are described in greater detail in Managements Discussion and Analysis (MD&A) under Part II, Item 7 of the Companys Annual Report on Form 10-K for the year ended February 28, 2014, as filed with the Securities and Exchange Commission on April 24, 2014, and include the following areas:
RESULTS OF OPERATIONS
OUR COMPANY
We are a leading provider of wireless communications solutions for a broad array of applications to customers globally. Our business activities are organized into our Wireless DataCom and Satellite reporting segments.
WIRELESS DATACOM
Our Wireless DataCom segment offers solutions for Mobile Resource Management (MRM) applications, the broader Machine-to-Machine (M2M) communications space and other emerging markets that require connectivity anytime and anywhere. Our MRM and M2M solutions enable customers to optimize their operations by collecting, monitoring and efficiently reporting business-critical data and desired intelligence from high-value remote and mobile assets. Our extensive portfolio of communications devices, scalable cloud service platforms, and targeted software applications streamline otherwise complex M2M or MRM deployments for our customers. We are focused on delivering products, software services and solutions globally for our Energy, Government, Transportation and Automotive vertical markets. In addition, we anticipate future opportunities for adoption of our MRM products and M2M solutions in Heavy Equipment and various aftermarket telematics applications including Usage-Based Automotive Insurance, as well as other emerging applications and markets.
SATELLITE
Our Satellite segment develops, manufactures and sells direct-broadcast satellite (DBS) outdoor customer premise equipment and whole home video networking devices for digital and high definition satellite television services. Our satellite products are sold primarily to EchoStar, an affiliate of Dish Network, for incorporation into complete subscription satellite television systems.
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Operating Results by Business Segment
The Company's revenue, gross profit and operating income by business segment are as follows:
REVENUE BY SEGMENT | ||||||||||||||||||||
Three Months Ended August 31, | Six Months Ended August 31, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
% of | % of | % of | % of | |||||||||||||||||
$000s | Total | $000s | Total | $000s | Total | $000s | Total | |||||||||||||
Segment | ||||||||||||||||||||
Wireless DataCom | $ | 50,204 | 84.8% | $ | 47,196 | 80.3% | $ | 98,051 | 83.0% | $ | 88,061 | 78.2% | ||||||||
Satellite | 9,006 | 15.2% | 11,611 | 19.7% | 20,140 | 17.0% | 24,492 | 21.8% | ||||||||||||
Total | $ | 59,210 | 100.0% | $ | 58,807 | 100.0% | $ | 118,191 | 100.0% | $ | 112,553 | 100.0% |
GROSS PROFIT BY SEGMENT | ||||||||||||||||||||
Three Months Ended August 31, | Six Months Ended August 31, | |||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||
% of | % of | % of | % of | |||||||||||||||||
$000s | Total | $000s | Total | $000s | Total | $000s | Total | |||||||||||||
Segment | ||||||||||||||||||||
Wireless DataCom | $ | 18,047 | 88.1% | $ | 17,555 | 88.5% | $ | 35,362 | 86.9% | $ | 33,515 | 87.5% | ||||||||
Satellite | 2,449 | 11.9% | 2,284 | 11.5% | 5,353 | 13.1% | 4,805 | 12.5% | ||||||||||||
Total | $ | 20,496 | 100.0% | $ | 19,839 | 100.0% | $ | 40,715 | 100.0% | $ | 38,320 | 100.0% |
OPERATING INCOME BY SEGMENT | ||||||||||||||||||||||||||||
Three Months Ended August 31, | Six Months Ended August 31, | |||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||
% of | % of | % of | % of | |||||||||||||||||||||||||
Total | Total | Total | Total | |||||||||||||||||||||||||
$000s | Revenue | $000s | Revenue | $000s | Revenue | $000s | Revenue | |||||||||||||||||||||
Segment | ||||||||||||||||||||||||||||
Wireless DataCom | $ | 4,657 | 7.9% | $ | 4,314 | 7.3% | $ | 8,325 | 7.0% | $ | 6,680 | 5.9% | ||||||||||||||||
Satellite | 1,300 | 2.2% | 1,228 | 2.1% | 3,156 | 2.7% | 2,776 | 2.5% | ||||||||||||||||||||
Corporate expenses | (924 | ) | (1.6% | ) | (785 | ) | (1.3% | ) | (1,844 | ) | (1.6% | ) | (1,822 | ) | (1.6% | ) | ||||||||||||
Total | $ | 5,033 | 8.5% | $ | 4,757 | 8.1% | $ | 9,637 | 8.1% | $ | 7,634 | 6.8% |
Revenue
Wireless DataCom revenue increased by $3.0 million, or 6%, to $50.2 million in the second quarter of fiscal 2015 compared to the fiscal 2014 second quarter due to the revenue contribution from Radio Satellite Integrators, Inc. that was acquired in December 2013, and to increased demand from a key customer in the solar energy industry. For the six months ended August 31, 2014, Wireless DataCom revenue increased by $10.0 million, or 11%, to $98.1 million compared to the same period of the prior year due primarily to the aforementioned factors for the three-month periods, as well as increased sales of MRM products into the auto insurance telematics and fleet management markets.
Satellite revenue decreased by $2.6 million, or 22%, to $9.0 million in the three months ended August 31, 2014 from $11.6 million for the same period in the previous fiscal year. For the six months ended August 31, 2014, Satellite revenue decreased by $4.4 million, or 18%, to $20.1 million from $24.5 million for the same period of the prior year. These declines are due to fluctuations in product demand on the part of the Satellite segments principal customer.
Gross Profit and Gross Margins
Wireless DataCom gross profit increased 3% to $18.0 million in the fiscal 2015 second quarter compared to $17.6 million in the second quarter of last year, and gross margin decreased to 35.9% in the second quarter of fiscal 2015 from 37.2% in the second quarter of fiscal 2014 due to product mix changes. Wireless DataCom gross profit increased 6% to $35.4 million in the six months ended August 31, 2014, compared to $33.5 million for the same period of the prior year primarily due to increased revenues. Wireless DataCom gross margin decreased from 38.1% in the first half of fiscal 2014 to 36.1% in the first half of fiscal 2015 primarily because MRM products, that generally have lower gross profit margins than other Wireless DataCom products and services, comprise a greater proportion of overall Wireless DataCom revenues in the current year.
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Satellite gross profit increased by $0.2 million to $2.4 million in the fiscal 2015 second quarter compared to the second quarter of last year. Satellite's gross margin increased to 27.2% in the fiscal 2015 second quarter from 19.7% in the second quarter of last year primarily due to changes in product mix.
The Satellite segment had gross profit of $5.4 million for the six months ended August 31, 2014, compared to gross profit of $4.8 million for the same period last year. Satellite gross margin was 26.6% for the six months ended August 31, 2014, compared to 19.6% for the same period last year. These increases are attributable to the same factor cited above for the three-month periods.
See also Note 12 to the accompanying unaudited consolidated financial statements for additional operating data by business segment.
Operating Expenses
Consolidated research and development (R&D) expense decreased by $0.3 million to $5.0 million in the second quarter of fiscal 2015 from $5.3 million in the second quarter of last year. For the six-month year-to-date periods, R&D expense decreased by $0.3 million from $10.4 million last year to $10.1 million due primarily to absorption of engineering time on customer product development and internal-use software projects.
Consolidated selling expenses were almost unchanged at $4.9 million in the second quarter of this year compared to last year. For the six-month year-to-date periods, selling expenses increased by $0.2 million to $10.1 million this year from $9.9 million last year due primarily to the sales and marketing expenses of Radio Satellite Integrators, Inc. which was acquired in the fourth quarter of fiscal 2014.
Consolidated general and administrative expenses ("G&A") increased by $0.5 million to $3.9 million in the second quarter of this year from $3.4 million last year. For the six-month periods, consolidated G&A increased by $0.3 million to $7.5 million for fiscal 2014 from $7.2 million last year due primarily to higher legal expenses and stock compensation expense.
Amortization of intangibles increased from $1.5 million in the second quarter of last year to $1.6 million in the second quarter of this year. For the six-month periods, amortization of intangibles increased to $3.3 million this year from $3.1 million last year. These increases are due to amortization of intangible assets that arose in conjunction with the acquisition of Radio Satellite Integrators, Inc. in December 2013.
Non-operating Expense, Net
Non-operating expense, net decreased by $77,000 to $4,000 in the second quarter of this year compared to $81,000 in the second quarter of last year due primarily to higher interest income this year compared to last year and lower interest expense this year compared to last year because of the payoff of the bank term loan during the third quarter of last year.
Non-operating expense, net was $91,000 in the six months ended August 31, 2014 compared to $250,000 in the six months ended August 31, 2013 due primarily to the same factors cited above for the three month periods.
Income Tax Provision
The effective income tax rate was 37.5% and 38.7% in the six months ended August 31, 2014 and 2013, respectively. The decline in effective tax rate was primarily due to updated estimates of current year transfer pricing effects.
LIQUIDITY AND CAPITAL RESOURCES
The Company has a credit facility with Square 1 Bank that provides for borrowings up to $15 million or 85% of eligible accounts receivable, whichever is less. The credit facility expires on March 1, 2017. Borrowings under this line of credit bear interest at the banks prime rate. There were no borrowings outstanding under this credit facility at August 31, 2014 or February 28, 2014.
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The Square 1 Bank credit facility 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 on a rolling 12-month basis. At August 31, 2014, the Company was in compliance with its debt covenants under the credit facility.
The Company's primary sources of liquidity are its cash, cash equivalents, marketable securities and the revolving line of credit with Square 1 Bank. During the first half of fiscal 2015, cash and cash equivalents increased by $4.1 million. During this period, cash of $15.8 million was provided by operations, and cash of $7.7 million was used in investing activities, consisting of net purchases of marketable securities of $4.6 million and capital expenditures of $3.1 million. In addition, cash of $4.1 million was used in financing activities, consisting of taxes paid related to net share settlement of vested equity awards of $3.0 million and payment of acquisition-related note and contingent consideration of $1.6 million on the note payable to Navman, partially offset by proceeds of $0.5 million from exercise of stock options.
FORWARD LOOKING STATEMENTS
Forward looking statements in this Form 10-Q which include, without limitation, statements relating to the Company's plans, strategies, objectives, expectations, intentions, projections and other information regarding future performance, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words "may", "will", "could", "plans", "intends", "seeks", "believes", "anticipates", "expects", "estimates", "judgment", "goal", and variations of these words and similar expressions, are intended to identify forward-looking statements. These forward-looking statements reflect the Company's current views with respect to future events and financial performance and are subject to certain risks and uncertainties, including, without limitation, product demand, competitive pressures and pricing declines in the Company's wireless and satellite markets, the timing of customer approvals of new product designs, intellectual property infringement claims, interruption or failure of our Internet-based systems used to wirelessly configure and communicate with the tracking and monitoring devices that we sell, and other risks and uncertainties that are set forth in Part II, Item 1A herein and in Part I, Item 1A of the Annual Report on Form 10-K for the year ended February 28, 2014 as filed with the Securities and Exchange Commission on April 24, 2014. Such risks and uncertainties could cause actual results to differ materially from historical or anticipated results. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be attained. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Foreign Currency Risk
The Company has international operations, giving rise to exposure to market risks from changes in foreign exchange rates. A cumulative foreign currency translation loss of $65,000 related to the Company's Canadian subsidiary is included in accumulated other comprehensive loss in the stockholders' equity section of the consolidated balance sheet at August 31, 2014. The aggregate foreign currency transaction exchange rate gains (losses) included in determining income before income taxes were $(4,000) and $5,000 in the three months ended August 31, 2014 and 2013, respectively. The aggregate foreign currency transaction exchange rate gains (losses) included in determining income before income taxes were $16,000 and $(34,000) in the six months ended August 31, 2014 and 2013, respectively.
Interest Rate Risk
The Company has variable-rate bank debt. A fluctuation of one percent in the interest rate on the $15 million credit facility with Square 1 Bank would have an annual impact of approximately $150,000 on the Company's consolidated statement of operations assuming that the full amount of the facility was borrowed. There were no borrowings outstanding on this facility at August 31, 2014.
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ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
The Company's principal executive officer and principal financial officer have concluded, based on their evaluation of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, (the "Exchange Act")) as of the end of the period covered by this Report, that the Company's disclosure controls and procedures are effective to ensure that the information required to be disclosed in reports that are filed or submitted under the Exchange Act is accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure and that such information is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.
Internal Control Over Financial Reporting
There has been no change in the Company's internal control over financial reporting that occurred during the Company's most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is not currently involved in any material pending legal proceedings.
ITEM 1A. RISK FACTORS
The reader is referred to Part I, Item 1A. Risk Factors in the Companys Annual Report on Form 10-K for the year ended February 28, 2014 for a discussion of factors that could materially affect the Companys business, financial condition or future results. The risks described in the Companys Annual Report on Form 10-K are not the only risks facing the Company at the present time. An additional risk is as follows:
Approximately two years ago, we were engaged by a major OEM manufacturer in the heavy equipment industry to develop and produce telematics devices used to transmit information about the heavy equipment, including operating location, equipment performance and diagnostic data. We are currently transitioning from product development to volume production with this customer, and consequently we expect our product sales to this customer will increase significantly over the next 12 months. Any unforeseen delays in the expected ramp in product shipments to this customer or an adverse change in our relationship with this customer could have a significant impact on our current outlook for our results of operations over the next several quarters.
ITEM 6. EXHIBITS
Exhibit 3.1 | Amended and Restated Certificate of Incorporation that provide that the number of directors that constitute the whole Board of Directors may not be less than six and not more than ten | |
Exhibit 3.2 | Amended and Restated Bylaws of the Company | |
Exhibit 31.1 | Chief Executive Officer Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
Exhibit 31.2 | Chief Financial Officer Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
Exhibit 32 | Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema Document | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
October 6, 2014 | /s/ Richard Vitelle | |||
Date | Richard Vitelle | |||
Executive Vice President & CFO | ||||
(Principal Financial Officer and | ||||
Chief Accounting Officer) |
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Exhibit 3.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
CALAMP CORP.
a Delaware Corporation
Richard Vitelle, Secretary of CalAmp Corp., a corporation organized and existing under the laws of the State of Delaware (the "Corporation") does hereby certify as follows:
1. The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on September 8, 1987. The Certificate of Incorporation was subsequently amended and restated on September 19, 1996, July 30, 2004 and August 30, 2012.
2. This Amended and Restated Certificate of Incorporation amends, restates and integrates the amended and restated certificate of incorporation of said Corporation and has been duly adopted in accordance with the provisions of Sections 242 and 245 of the General Corporation Law of the State of Delaware by the favorable vote of the holders of a majority of the outstanding stock entitled to vote thereon.
3. That the Amended and Restated Certificate of Incorporation of the Corporation, as so amended and restated, is hereby amended and restated in its entirety so that the same shall read as follows:
ARTICLE I
ARTICLE II
A. The address of the registered office of the Corporation in the State of Delaware is 2140 S. DuPont Highway, Camden, Delaware 19934 in the County of Kent. The name of its registered agent at that address is Paracorp Incorporated.
B. The Corporation shall have a perpetual existence.
ARTICLE III
The purpose of the Corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of the State of Delaware as set forth in Title 8 of the Delaware Code (the "GCL").
ARTICLE IV
The Corporation is authorized to issue two classes of capital stock, designated Common Stock and Preferred Stock. The amount of total authorized capital stock of the Corporation is 83,000,000 shares, divided into 80,000,000 shares of Common Stock, par value $0.01 per share, and 3,000,000 shares of Preferred Stock, par value $0.01 per share.
The Preferred Stock may be issued in one or more series. The Board of Directors is hereby authorized to issue the shares of Preferred Stock in such series and to fix from time to time before issuance the number of shares to be included in any series and the designation, relative powers, preferences and rights and qualifications, limitations or restrictions of all shares of such series. The authority of the Board of Directors with respect to each series shall include, without limiting the generality of the foregoing, the determination of any or all of the following:
(a) The number of shares constituting that series and the distinctive designation of that series;
(b) The dividend rate on the shares of that series, whether dividends shall be cumulative, and, if so, from which date or dates, and the relative rights of priority, if any, of payment of dividends on shares of that series;
(c) Whether that series shall have voting rights, in addition to the voting rights provided by law, and if so, the terms of such voting rights;
(d) Whether that series shall have conversion privileges, and, if so, the terms and conditions of such conversion, including provision for adjustment of the conversion rate upon the happening of certain specified events;
(e) Whether or not the shares of that series shall be redeemable, and, if so, the terms and conditions of such redemption including the date or dates upon or after which they shall be redeemable, and the amount per share payable in case of redemption, which amount may vary under different conditions and at different redemption dates;
(f) Whether that series shall have a sinking fund for the redemption or purchase of shares of that series, and, if so, the terms and amount of such sinking fund;
(g) The rights of the shares of that series in the event of voluntary or involuntary liquidation, dissolution or winding up of the Corporation, and the relative rights of priority, if any, of payment on shares of that series; and
(h) Such other designations, preferences and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof as it may deem advisable;
all as shall be determined from time to time by the Board of Directors and shall be stated in a resolution or resolutions providing for the issuance of such Preferred Stock (a "Preferred Stock Designation").
2
The number of authorized shares of Preferred Stock may be increased or decreased (but not below the number of shares then outstanding) by the affirmative vote of the holders of a majority of the capital stock of the Corporation entitled to vote, with all such holders voting as a single class.
ARTICLE V
A. Each holder of Common Stock of the Corporation entitled to vote shall have one vote for each share thereof held.
B. Except as may be provided by the Board of Directors in a Preferred Stock Designation or by law, the holders of Common Stock shall have the exclusive right to vote for the election of directors and for all other purposes, and holders of Preferred Stock shall not be entitled to receive notice of any meeting of stockholders at which they are not entitled to vote or consent.
C. The Corporation shall be entitled to treat the person in whose name any shares of its capital stock is registered as the owner thereof, for all purposes, and shall not be bound to recognize any equitable or other claim to, or interest in, such shares on the part of any other person, whether or not the Corporation shall have notice thereof, except as expressly provided by applicable law.
D. No vote at any meeting of stockholders need be by written ballot unless the Board of Directors, in its discretion, or the officer of the Corporation presiding at the meeting, in his or her discretion, specifically directs the use of a written ballot.
E. Special meetings of the stockholders of the Corporation for any purpose or purposes may be called at any time by the Board of Directors, the Chairman of the Board of Directors, the President or the holders of 10% or more of the combined voting power of all classes of the Corporation's capital stock.
ARTICLE VI
A. The business and affairs of the Corporation shall be managed by or under the direction of a Board of Directors consisting of no fewer than six and no more than ten directors. The exact number of directors of the Corporation shall be fixed from time to time, within the limits specified, solely by resolution of the Board. At each annual meeting of stockholders the directors shall be elected to hold office until the next annual meeting. Each director shall hold office after the annual meeting at which his or her term is scheduled to end until his or her successor shall be elected and shall qualify, subject to prior death, resignation, disqualification, or removal from office. Any director elected to fill a vacancy not resulting from an increase in the number of directors shall have the same term as the remaining term of his or her predecessor. In no case may a decrease in the number of directors shorten the term of any incumbent director. Any newly-created directorship resulting from an increase in the number of directors may be filled by a majority of the Board of Directors then in office, provided that a quorum is present, and any other vacancy on the Board of Directors may be filled by a majority of the directors then in office, even if less than a quorum, or by a sole remaining director.
3
Notwithstanding anything to the contrary, the holders of a majority of the shares then entitled to vote at an election of directors may remove any director with or without cause.
Notwithstanding the foregoing, whenever the holders of any one or more classes or series of Preferred Stock issued by the Corporation shall have the right, voting separately by class or series, to elect directors at an annual or special meeting of stockholders, the election, term of office, filling of vacancies and other features of such directorships shall be governed by the terms of the Preferred Stock Designation applicable thereto, and such directors so elected shall be in addition to the number of directors provided by this Amended and Restated Certificate of Incorporation.
B. The directors shall have the power to adopt, amend or repeal the Bylaws of the Corporation.
ARTICLE VII
A. RIGHT TO INDEMNIFICATION. Each person who was or is made a party or is threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a "proceeding"), by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise (including service with respect to employee benefit plans), whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent or in any other capacity while serving as a director, officer, employee or agent, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the GCL against all expense, liability and loss (including attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by such person in connection therewith; and such indemnification shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of his or her heirs, executors and administrators; PROVIDED, HOWEVER, that except as provided in Paragraph B of this Article VII, the Corporation shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) which is initiated by such person only if such proceeding (or part thereof) was authorized by the Board of Directors. The right to indemnification conferred in this Article VII shall be a contract right and shall include the right to have paid by the Corporation the expenses incurred in defending any such proceeding in advance of its final disposition; PROVIDED, HOWEVER, that, if the GCL so requires, the payment of such expense incurred by a director of officer in his or her capacity as a director or officer in advance of the final disposition of a proceeding, shall be made upon delivery to the Corporation of an undertaking, by or on behalf of such director or officer, to repay all amounts so advanced if it shall ultimately be determined that such director of officer is not entitled to be indemnified under this Article VII or otherwise. The Corporation may, by action of the Board of Directors, provide indemnification to employees and agents of the Corporation with the same scope and effect as the foregoing indemnification of directors and officers.
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B. RIGHT OF CLAIMANT TO BRING SUIT. If a claim under Paragraph A of this Article VII is not paid in full by the Corporation within 30 days after a written claim has been received by the Corporation, the Claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the Claimant shall also be entitled to have paid the expense of prosecuting such claim. It shall be a defense to any such action (other than an action brought to enforce a advance of its final disposition where the required undertaking, if any is required, has been tendered to the Corporation) that the Claimant has not met the standards of conduct which make it permissible under the GCL for the Corporation to indemnify the Claimant for the amount claimed, but the burden of providing such defense shall be on the Corporation. Neither the failure of the Corporation (including the Board of Directors, independent legal counsel or the stockholders) to have made a determination prior to the commencement of such action that indemnification of the Claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the GCL, nor an actual determination by the Corporation (including the Board of Directors, independent legal counsel or the stockholders) that the Claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the Claimant has not met the applicable standard of conduct.
C. INSURANCE. The Corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any such expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the GCL.
ARTICLE VIII
A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except that this Article VIII shall not eliminate or limit a director's liability (i) for any breach of such director's duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the GCL, or (iv) for any transaction from which such director derived an improper personal benefit.
Any repeal or modification of this Article VIII shall not increase the personal liability of any director of the Corporation for any act or occurrence taking place prior to such repeal or modification, or otherwise adversely affect any right to protection of a director of the Corporation existing at the time of such repeal or modification.
The provisions of this Article VIII shall not be deemed to limit or preclude indemnification of a director by the Corporation for any liability of a director which has not been eliminated by the provisions of this Article VIII.
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ARTICLE IX
The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Amended and Restated Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred on stockholders herein are granted subject to this reservation.
ARTICLE X
Meetings of stockholders may be held within or outside the State of Delaware, as the Bylaws of the Corporation may provide. The books of the Corporation may be kept (subject to any provisions contained in applicable law) outside the State of Delaware at such place as may be designated from time to time by the Board of Directors or the Bylaws of the Corporation.
IN WITNESS WHEREOF, the undersigned, being the duly authorized Secretary of the Corporation, has executed this Amended and Restated Certificate of Incorporation this 31st day of July, 2014.
CALAMP CORP. | |
By: | /s/ Richard Vitelle |
Richard Vitelle | |
Secretary |
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Exhibit 3.2
CALAMP CORP.
(a Delaware corporation)
AMENDED AND RESTATED BYLAWS
August 1,
2014
ARTICLE I
Offices
SECTION 1.01 Registered Office. The registered office of CalAmp Corp. (the "Corporation") in the State of Delaware shall be at 2140 S. DuPont Highway, City of Camden, County of Kent. The name of the registered agent in charge shall be Paracorp Incorporated.
SECTION 1.02 Other Offices. The Corporation may also have an office or offices at any other place or places, either within or outside the State of Delaware, as the Board of Directors (the "Board") may from time to time determine or as the business of the Corporation may require.
ARTICLE II
Meetings of Stockholders
SECTION 2.01 Annual Meetings. Annual meetings of the stockholders of the Corporation for the purpose of electing directors and for the transaction of such other proper business as may come before such meetings may be held at such time, date and place as the Board shall determine by resolution.
SECTION 2.02 Special Meetings. A special meeting of the stockholders for the transaction of any proper business may be called at any time by the Board, the Chairman of the Board, the President or the holders of 10% or more of the combined voting power of all classes of the Corporation's capital stock.
SECTION 2.03 Place of Meetings. All meetings of the stockholders shall be held at locations, within or outside the State of Delaware, as may from time to time be designated by the person or persons calling the respective meeting and specified in the respective notices or waivers of notice relating to the meeting.
SECTION 2.04 Notice of Meetings. Except as otherwise required by law, notice of each meeting of the stockholders, whether annual or special, shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder of record entitled to vote at the meeting by delivering written notice to such stockholder personally, or by depositing such notice in the United States mail, in a postage prepaid envelope, directed to such stockholder at the post office address furnished by such stockholder to the Secretary of the Corporation for that purpose or, if such stockholder has not furnished to the Secretary an address for such purpose, then at the post office address last known to the Secretary, or by transmitting a notice to such stockholder at such address by telegraph, cable, or wireless. Without limiting the manner by which notice otherwise may be given effectively to stockholders, notice of meetings may be given to stockholders by means of electronic transmission in accordance with applicable law. Except as otherwise expressly required by law, no publication of any notice of a meeting of the stockholders shall be required. Every notice of a meeting of the stockholders shall state the place, date and hour of the meeting, and, in the case of a special meeting, shall also state the purpose or purposes for which the meeting is called. Notice of any meeting of stockholders need not be given to any stockholder who waives such notice, and such notice shall be deemed waived by any stockholder who attends such meeting in person or by proxy, except as a stockholder who attends such meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Except as otherwise expressly required by law, notice of any adjourned meeting of the stockholders need not be given if the time and place thereof are announced at the meeting at which the adjournment is taken.
SECTION 2.05 Quorum. Except in the case of any meeting for the election of directors summarily ordered as provided by law, the holders of record of a majority in voting interest of the shares of stock of the Corporation entitled to be voted thereat, present in person or by proxy, shall constitute a quorum for the transaction of business at any meeting of the stockholders of the Corporation or any adjournment thereof. In the absence of a quorum at any meeting or any adjournment thereof, a majority in voting interest of the stockholders present in person or by proxy and entitled to vote thereat or, in the absence there from of all the stockholders, any officer entitled to preside at, or to act as secretary of, such meeting may adjourn such meeting from time to time. At any such adjourned meeting at which a quorum is present any business may be transacted which might have been transacted at the meeting as originally called. A quorum, once established, shall not be broken by the subsequent withdrawal of enough votes to leave less than a quorum.
SECTION 2.06 Voting.
(a) At each meeting of the stockholders, each stockholder is entitled to vote in person or by proxy each share or fractional share of the stock of the Corporation having voting rights on the matter in question and held by him or her and registered in the stockholder's name on the books of the Corporation:
(i) on the date fixed pursuant to Section 6.05 of these Bylaws as the record date for the determination of stockholders entitled to notice of and to vote at the meeting, or
(ii) if no record date is so fixed, then (A) at the close of business on the day next preceding the day on which notice of the meeting is given or (B) if notice of the meeting is waived, at the close of business on the day next preceding the day on which the meeting will be held.
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(b) Shares of its own stock belonging to the Corporation or to another corporation, if a majority of the shares entitled to vote in the election of directors in such other corporation is held, directly or indirectly, by the Corporation, shall neither be entitled to vote nor be counted for quorum purposes. Persons holding stock of the Corporation in a fiduciary capacity shall be entitled to vote such stock. Persons whose stock is pledged shall be entitled to vote, unless in the transfer by the pledgor on the books of the Corporation the pledgor expressly empowered the pledgee to vote thereon, in which case only the pledgee, or the pledgee's proxy, may represent such stock and vote thereon. Stock having voting power standing of record in the names of two or more persons, whether fiduciaries, members of a partnership, joint tenants in common, tenants by entirety or otherwise, or with respect to which two or more persons have the same fiduciary relationship, shall be voted in accordance with the provisions of the General Corporation Law of the State of Delaware.
(c) Any such voting rights may be exercised by the stockholder entitled thereto in person or by the stockholders proxy appointed by an instrument in writing, subscribed by such stockholder or by the stockholders attorney thereunto authorized and delivered to the secretary of the meeting; provided, however, that no proxy shall be voted or acted upon after three years from its date unless said proxy shall provide for a longer period.
The attendance at any meeting of a stockholder who has given a proxy shall not have the effect of revoking the same unless the stockholder notifies the secretary of the meeting in writing prior to the voting of the proxy. At any meeting of the stockholders all matters, except as otherwise provided in the Certificate of Incorporation, in Section 8.03 of these Bylaws, or by law, shall be decided by the vote of a majority in voting interest of the stockholders present in person or by proxy and entitled to vote thereat and thereon, a quorum being present. The vote at any meeting of the stockholders on any question need not be by ballot, unless so directed by the Board or the officer of the Corporation presiding at the meeting. On a vote by ballot each ballot shall be signed by the stockholder voting, or by the stockholder's proxy, if there be such proxy, and it shall state the number of shares voted.
SECTION 2.07 List of Stockholders. The Secretary of the Corporation shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.
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SECTION 2.08 Inspectors at Meetings of Stockholders. If at any meeting of the stockholders a vote by written ballot shall be taken on any question, the chairman of the meeting may appoint an inspector or inspectors to act with respect to the vote. Each inspector appointed shall first subscribe an oath faithfully to execute the duties of an inspector at such meeting with strict impartiality and according to the best of his or her ability. Such inspectors shall decide upon the qualification of the voters and shall report the number of shares represented at the meeting and entitled to vote on such question, shall conduct and accept the votes, and, when the voting is completed, shall ascertain and report the number of shares voted respectively for and against the question. Reports of inspectors shall be in writing and subscribed and delivered by them to the Secretary of the Corporation. The inspectors need not be stockholders of the Corporation, and any officer of the Corporation may be an inspector on any question other than a vote for or against a proposal in which the inspector has a material interest.
SECTION 2.09 Actions Without Meeting. Any action required to be taken at any annual or special meeting of stockholders of the Corporation, or any action which may be taken at any annual or special meeting of such stockholders, may be taken without a meeting, without prior notice and without a vote, if consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock, having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing.
SECTION 2.10 Advance Notice of Stockholder Business Proposals and of Stockholder Nominations.
(a) At any meeting of the stockholders, only such business shall be conducted as shall have been brought before the meeting (i) by or at the direction of the Board of Directors or (ii) by any stockholder of the Corporation who complies with the notice procedures set forth in this Section 2.10(a). For business to be properly brought before any meeting of the stockholders by a stockholder, the stockholder must have given notice thereof in writing to the Secretary of the Corporation not less than sixty (60) days in advance of such meeting or, if later, the seventh (7th) day following the first public announcement of the date of such meeting. A stockholder's notice to the Secretary shall set forth as to each matter the stockholder proposes to bring before the meeting: (1) a brief description of the business desired to be brought before the meeting and the reasons for conducting such business at the meeting, (2) the name and address, as they appear on the Corporation's books, of the stockholder proposing such business, (3) the class and number of shares of the Corporation that are beneficially owned by the stockholder, and (4) any material interest of the stockholder in such business. In addition, the stockholder making such proposal shall promptly provide any other information reasonably requested by the Corporation. Notwithstanding anything in these Bylaws to the contrary, no business shall be conducted at any meeting of the stockholders except in accordance with the procedures set forth in this Section 2.10. The chairman of any such meeting shall direct that any business not properly brought before the meeting shall not be considered.
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(b) Nominations for the election of directors may be made by the Board of Directors or by any stockholder entitled to vote in the election of directors; provided, however, that a stockholder may nominate a person for election as a director at a meeting only if written notice of such stockholder's intent to make such nomination has been given to the Secretary of the Corporation not later than sixty (60) days in advance of such meeting or, if later, the seventh (7th) day following the first public announcement of the date of such meeting. Each such notice shall set forth: (i) the name and address of the stockholder who intends to make the nomination and of the person or persons to be nominated; (ii) a representation that the stockholder is a holder of record of stock of the Corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting and nominate the person or persons specified in the notice; (iii) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder; (iv) such other information regarding each nominee proposed by such stockholder as would be required to be included in a proxy statement filed pursuant to the proxy rules of the United States Securities and Exchange Commission had the nominee been nominated, or intended to be nominated, by the Board; and (v) the consent of each nominee to serve as a director of the Corporation if so elected. In addition, the stockholder making such nomination shall promptly provide any other information reasonably requested by the Corporation. No person shall be eligible for election as a director of the Corporation unless nominated in accordance with the procedures set forth in this Section 2.10(b). The chairman of any meeting of stockholders shall direct that any nomination not made in accordance with these procedures be disregarded.
ARTICLE III
Board of Directors
SECTION 3.01 General Powers. The business and affairs of the Corporation shall be managed by the Board.
SECTION 3.02 Number and Term of Office. The Board shall consist of no fewer than six (6) and no more than ten (10) directors. Directors need not be stockholders. Each director shall serve for a term ending at the annual meeting following the annual meeting at which such director is elected; and each director shall hold office after the annual meeting at which his or her term is scheduled to end until his or her successor shall be elected and shall qualify, subject to prior death, resignation, disqualification, or removal from office. Any director elected to fill a vacancy not resulting from an increase in the number of directors shall have the same term as the remaining term of his or her predecessor. In no case will a decrease in the number of directors shorten the term of any incumbent director. Any newly created directorship resulting from an increase in the number of directors may be filled by a majority of the Board then in office, provided that a quorum is present, and any other vacancy on the Board may be filled by a majority of the directors then in office, even if less than a quorum, or by a sole remaining director.
Notwithstanding anything to the contrary, the holders of a majority of the shares then entitled to vote at an election of directors may remove any director with or without cause.
Notwithstanding the foregoing, whenever the holders of any one or more classes or series of Preferred Stock issued by the Corporation shall have the right, voting separately by class or series, to elect directors at an annual or special meeting of stockholders, the election, term of office, filling of vacancies and other features of such directorships shall be governed by the terms of the Preferred Stock Designation applicable thereto, and such directors so elected shall be in addition to the number of directors provided by these Bylaws.
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SECTION 3.03 Bylaws. The Board shall have the power to adopt, amend or repeal the Bylaws of the Corporation, consistent with its powers under Section 8.03(i) and in addition to the power given stockholders under Section 8.03(ii).
SECTION 3.04 Resignations. Any director of the Corporation may resign at any time by giving written notice to the Board or to the Secretary of the Corporation. Any such resignation shall take effect at the time specified therein, or, if the time is not specified, immediately upon receipt; and unless otherwise specified therein, the acceptance of such resignation is not necessary to make it effective.
SECTION 3.05 Vacancies. Except as otherwise provided in the Certificate of Incorporation, any vacancy in the Board, whether because of death, resignation, disqualification, an increase in the number of directors, or any other cause, may be filled by vote of the majority of the remaining directors, although less than a quorum. Each director so chosen to fill a vacancy shall hold office until his or her successor is elected and qualifies or until he or she resigns or is removed in the manner hereinafter provided.
SECTION 3.06 Place of Meeting, Etc. The Board may hold any of its meetings at such place or places within or outside the State of Delaware as the Board may from time to time by resolution designate or as shall be designated by the person or persons calling the meeting or in the notice or a waiver of notice of any such meeting. Directors may participate in any regular or special meeting of the Board by means of conference telephone or similar communications equipment pursuant to which all persons participating in the meeting of the Board can hear each other, and such participation shall constitute presence in person at such meeting.
SECTION 3.07 First Meeting. The Board shall meet as soon as practicable after each annual election of directors and notice of such first meeting shall not be required.
SECTION 3.08 Regular Meetings. Regular meetings of the Board may be held at such times as the Board shall from time to time by resolution determine. If any day fixed for a regular meeting shall be a legal holiday at the place where the meeting is to be held, then the meeting shall be held at the same hour and place on the next succeeding business day not a legal holiday. Except as provided by law, notice of regular meetings need not be given.
SECTION 3.09 Special Meetings. Special meetings of the Board shall be held whenever called by the President or a majority of the authorized number of directors. Except as otherwise provided by law or by these Bylaws, notice of the time and place of each special meeting shall be mailed to each director, addressed to such director at his or her residence or usual place of business, at least five (5) days before the day on which the meeting is to be held, or shall be sent to such director at such place by telegraph, cable, personal delivery, or by means of electronic transmission, not less than forty-eight (48) hours before the time at which the meeting is to be held. Except where otherwise required by law or by these Bylaws, notice of the purpose of a special meeting need not be given. Notice of any meeting of the Board shall not be required to be given to any director who is present at such meeting, except a director who shall attend such meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened.
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SECTION 3.10 Quorum and Manner of Acting. Except as otherwise provided in these Bylaws or by law, the presence of a majority of the authorized number of directors shall be required to constitute a quorum for the transaction of business at any meeting of the Board, and all matters shall be decided at any such meeting, a quorum being present, by the affirmative votes of a majority of the directors present. In the absence of a quorum, a majority of directors present at any meeting may adjourn the same from time to time until a quorum shall be present. Notice of any adjourned meeting need not be given. The directors shall act only as a Board, and the individual directors shall have no power as such.
SECTION 3.11 Action by Consent Without Meeting. Any action required or permitted to be taken at any meeting of the Board or of any committee thereof may be taken without a meeting if a written consent thereto is signed, or electronic transmission of consent is delivered, by all members of the Board or of such committee, as the case may be, and such written consent or electronic transmission is filed with the minutes of proceedings of the Board or committee.
SECTION 3.12 Removal of Directors. Subject to the provisions of the Certificate of Incorporation, any director may be removed at any time, either with or without cause, by the affirmative vote of the stockholders having a majority of the voting power of the Corporation given at a special meeting of the stockholders called for that purpose.
SECTION 3.13 Compensation. The directors shall receive only such compensation for their services as directors as may be allowed by resolution of the Board. The Board may also provide that the Corporation shall reimburse each such director for any expense incurred by such director on account of his or her attendance at any meetings of the Board or Committees of the Board. Neither the payment of such compensation nor the reimbursement of such expenses shall be construed to preclude any director from serving the Corporation or its subsidiaries in any other capacity and receiving compensation therefore.
SECTION 3.14 Committees. The Board may, by resolution passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. Any such committee, to the extent provided in the resolution of the Board and except as otherwise limited by law, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it. Any such committee shall keep written minutes of its meetings and report the same to Board at the next regular meeting of the Board. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member.
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ARTICLE IV
Officers
SECTION 4.01 Number. The officers of the Corporation shall be a President, one or more Vice Presidents (the number thereof and their respective titles to be determined by the Board), a Secretary, a Treasurer and such other officers as may be determined by the Board.
SECTION 4.02 Election Term of Office and Qualifications. The officers of the Corporation, except such officers as may be appointed in accordance with Section 4.03, shall be elected annually by the Board at the first meeting thereof held after the election thereof. Each officer shall hold office until his or her successor shall have been duly chosen and shall qualify or until his or her resignation or removal in the manner hereinafter provided.
SECTION 4.03 Assistants, Agents and Employees, Etc. In addition to the officers specified in Section 4.01, the Board may appoint any other officers, assistants, agents and employees as it may deem necessary or advisable, including one or more Assistant Secretaries, and one or more Assistant Treasurers, each of whom shall hold office for such period, have such authority, and perform such duties as the Board may from time to time determine. The Board may delegate to any officer of the Corporation or any committee of the Board the power to appoint, remove and prescribe the duties of any such assistants, agents or employees.
SECTION 4.04 Removal. Any officer, assistant, agent or employee of the Corporation may be removed, with or without cause, at any time: (i) in the case of an officer, assistant, agent or employee appointed by the Board, only by resolution of the Board; and (ii) in the case of an officer, assistant, agent or employee, by any officer of the Corporation or committee of the Board upon whom or which such power of removal may be conferred by the Board.
SECTION 4.05 Resignations. Any officer or assistant may resign at any time by giving written notice of the resignation to the Board or the Secretary of the Corporation. Any such resignation shall take effect at the time specified therein, or, if the time is not specified, upon receipt thereof by the Board or the Secretary, as the case may be. Unless otherwise specified therein, the acceptance of such resignation is not necessary to make it effective.
SECTION 4.06 Vacancies. A vacancy in any office because of death, resignation, removal, disqualification, or other cause, may be filled for the unexpired portion of the term thereof in the manner prescribed in these Bylaws for regular appointments or elections to such office.
SECTION 4.07 The President. The President of the Corporation shall also be the chief executive officer of the Corporation and shall have, subject to the control of the Board, general and active supervision and management over the business of the Corporation and over its several officers, assistants, agents and employees.
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SECTION 4.08 The Vice Presidents. Each Vice President shall have such powers and perform such duties as the Board may from time to time prescribe. At the request of the President, or in case of the President's absence or inability to act upon the request of the Board, a vice President shall perform the duties of the President and when so acting, shall have all the powers of, and be subject to all the restrictions upon, the President.
SECTION 4.09 The Secretary. The Secretary shall, if present, record the proceedings of all meetings of the Board, of the stockholders, and of all committees of which a secretary has not been appointed, in one or more books provided for that purpose; shall see that all notices are duly given in accordance with these Bylaws and as required by law; shall be custodian of the seal of the Corporation and shall affix and attest the seal to all documents to be executed on behalf of the Corporation under its seal; and, in general, shall perform all the duties incident to the office of Secretary and such other duties as may from time to time be assigned to him or her by the Board.
SECTION 4.10 The Treasurer. The Treasurer shall have the general care and custody of the funds and securities of the Corporation, and shall deposit all such funds in the name of the Corporation in such banks, trust companies or other depositories as selected by the Board. The Treasurer shall receive, and give receipts for, monies due and payable to the Corporation from any source whatsoever. The Treasurer shall exercise general supervision over expenditures and disbursements made by officers, agents and employees of the Corporation and the preparation of such records and reports in connection therewith as may be necessary or desirable. The Treasurer shall, in general, perform all other duties incident to the office of Treasurer and such other duties as from time to time may be assigned to him or her by the Board.
SECTION 4.11 Compensation. The compensation of the officers of the Corporation shall be fixed from time to time by the Board. None of such officers shall be prevented from receiving such compensation by reason of the fact that he or she is also a director of the Corporation. Nothing contained herein shall preclude any officer from serving the Corporation, or any subsidiary corporation, in any other capacity and receiving such compensation by reason of the fact that he or she is also a director of the Corporation. Nothing contained herein shall preclude any officer from serving the Corporation, capacity and or any subsidiary corporation, in any other capacity and receiving proper compensation therefore.
ARTICLE V
Contracts, Checks, Drafts, Bank Accounts, Etc.
SECTION 5.01 Execution of Contracts. The Board, except as otherwise provided in these Bylaws, may authorize any officer or officers, agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the Corporation, and such authority may be general or confined to specific instances. Unless so authorized by the Board or by these Bylaws, no officer, agent or employee shall have any power or authority to bind the Corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or in any amount.
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SECTION 5.02 Checks, Drafts, Etc. All checks, drafts or other orders for payment of money, notes or other evidence of indebtedness, issued in the name of or payable to the Corporation, shall be signed or endorsed by such person or persons and in such manner as, from time to time, shall be determined by resolution of the Board. Each such officer, assistant, agent or attorney shall give such bond, if any, as the Board may require.
SECTION 5.03 Deposits. All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation in such banks, trust companies or other depositories as the Board may select, or as may be selected by any officer or officers, assistant or assistants, agent or agents, or attorney or attorneys of the Corporation to whom such power shall have been delegated by the Board. For the purpose of deposit and for the purpose of collection for the account of the Corporation, the President, any Vice President or the Treasurer (or any other officer or officers, assistant or assistants, agent or agents, or attorney or attorneys of the Corporation who shall from time to time be determined by the Board) may endorse, assign and deliver checks, drafts and other orders for the payment of money which are payable to the order of the Corporation.
SECTION 5.04 General and Special Bank Accounts. The Board may from time to time authorize the opening and keeping of general and special bank accounts with such banks, trust companies or other depositories as the Board may select or as may be selected by any officer or officers, assistant or assistants, agent or agents, or attorney or attorneys of the Corporation to whom such power shall have been delegated by the Board. The Board may make such special rules and regulations with respect to such bank accounts, not inconsistent with the provisions of these Bylaws, as it may deems proper.
ARTICLE VI
Shares and Their Transfer
SECTION 6.01 Certificates for Stock. Every owner of stock of the Corporation shall be entitled to have a certificate or certificates, to be in such form as the Board shall prescribe, certifying the number and class of shares of the stock of the Corporation owned by that person. The certificates representing shares of such stock shall be numbered in the order in which they are issued and shall be signed in the name of the Corporation by the President or a Vice President, and by the Secretary or an Assistant Secretary or by the Treasurer or an Assistant Treasurer. Any of or all of the signatures on the certificates may be a facsimile. In case any officer, transfer agent or registrar who has signed, or whose facsimile signature has been placed upon, any such certificate, shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, such certificate may nevertheless be issued by the Corporation with the same effect as though the person who signed such certificate; or whose facsimile signature shall have been placed thereupon, were such officer, transfer agent or registrar at the date of issue. A record shall be kept of the respective names of the persons, firms or corporations owning the stock represented by such certificates, the number and class of shares represented by such certificates, respectively, and the respective dates thereof, and in case of cancellation, the respective dates of cancellation. Every certificate surrendered to the Corporation for exchange or transfer shall be cancelled, and no new certificate or certificates shall be issued in exchange for any existing certificate until such existing certificate shall have been so cancelled, except in cases provided for in Section 6.04.
10
SECTION 6.02 Transfers of Stock. Transfers of shares of stock of the Corporation shall be made only on the books of the Corporation by the registered holder thereof, or by that holder's attorney if authorized by power of attorney duly executed and filed with the Secretary, or with a transfer clerk or a transfer agent appointed as provided in Section 6.03, and upon surrender of the certificate or certificates for such shares properly endorsed and the payment of all taxes thereon. The person in whose name shares of stock stand on the books of the Corporation shall be deemed the owner thereof for all purposes as regards the Corporation. Whenever any transfer of shares shall be made for collateral security, and not absolutely, such fact shall be so expressed in the entry of transfer if, when the certificate or certificates shall be presented to the Corporation for transfer, both the transferor and the transferee request the Corporation to do so.
SECTION 6.03 Regulations. The Board may make such rules and regulations as it may deem expedient, not inconsistent with these Bylaws, concerning the issue, transfer and registration of certificates for shares of the stock of the Corporation. It may appoint, or authorize any officer or officers to appoint, one or more transfer clerks or one or more transfer agents and one or more registrars, and may require all certificates for stock to bear the signature or signatures of any of them.
SECTION 6.04 Lost, Stolen, Destroyed, and Mutilated Certificates. In any case of loss, theft, destruction, or mutilation of any certificate of stock, another may be issued in its place upon proof of such loss, theft, destruction, or mutilation and upon the giving of a bond of indemnity to the Corporation in such form and in such sum as the Board may direct; provided, however, that a new certificate may be issued without requiring any bond when, in the judgment of the Board, it is proper so to do.
SECTION 6.05 Fixing Date for Determination of Stockholders of Record. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any other change, conversion or exchange of stock or for the purpose of any other lawful action, the Board may fix, in advance, a record date, which shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting, nor more than sixty (60) days prior to any other action. If in any case involving the determination of stockholders for any purpose other than notice of or voting at a meeting of stockholders or expressing consent to corporate action without a meeting the Board shall not fix such a record date, the record date for determining stockholders for such purpose shall be the close of business on the day on which the Board shall adopt the resolution relating thereto. A determination of stockholders entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of such meeting; provided, however, that the Board may fix a new record date for the adjourned meeting.
11
ARTICLE VII
Indemnification
SECTION 7.01 Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a "proceeding"), by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise (including service with respect to employee benefit plans),' whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent or in any other capacity while serving as a director, officer, employee or agent, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the Delaware General Corporation Law (the "GCL") against all expense, liability and loss (including attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by such person in connection therewith; and such indemnification shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of his or her heirs, executors and administrators; provided, however, that except as provided in Section 7.03 of this Article VII, the Corporation shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) which is initiated by such person only if such proceeding (or part thereof) was authorized by the Board of Directors. The right to indemnification conferred in this Article VII shall be a contract right and shall include the right to have paid by the Corporation the expenses incurred in defending any such proceeding in advance of its final disposition; provided, however, that, if the GCL so requires, the payment of such expense incurred by a director or officer in his or her capacity as a director or officer in advance of the final disposition of a proceeding, shall be made upon delivery to the Corporation of an undertaking, by or on behalf of such director or officer, to repay all amounts so advanced if it shall ultimately be determined that such director or officer is not entitled to be indemnified under this Article VII or otherwise. The Corporation may, by action of the Board of Directors, provide indemnification to employees and agents of the Corporation with the same scope and effect as the foregoing indemnification of directors and officers.
SECTION 7.02 Right of Claimant to Bring Suit. If a claim under Section 7.01 of this Article VII is not paid in full by the Corporation within thirty (30) days after a written claim has been received by the Corporation, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall also be entitled to have paid the expense of prosecuting such claim. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition where the required undertaking, if any is required, has been tendered to the Corporation) that the claimant has not met the standards of conduct which make it permissible under the GCL for the Corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the Corporation. Neither the failure of the Corporation (including the Board of Directors, independent legal counsel or the stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the GCL, nor an actual determination by the Corporation (including the Board of directors, independent legal counsel or the stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.
12
SECTION 7.03 Indemnification Against Expenses of Successful Party. Notwithstanding the other provisions of this Article VII, to the extent that a director, officer, employee or agent of the Corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Section 7.01 or 7.02, or in defense of any claim, issue or matter therein, he or she shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him or her in connection therewith.
SECTION 7.04 Prepaid Expenses. Expenses incurred by an officer or director in defending a civil or criminal action, suit or proceeding may be paid by the Corporation in advance of the final disposition of such action, suit or proceeding as authorized by the Board in the specific case upon receipt of an undertaking by or on behalf of the director or officer to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the Corporation as authorized in this Article. Such expenses incurred by other employees and agents may be so paid upon such terms and conditions, if any, as the Board deems appropriate.
SECTION 7.05 Insurance. The Corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any such expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the GCL.
SECTION 7.06 Constituent Corporations. For the purpose of this Article VII, references to "the Corporation" include all constituent corporations absorbed in a consolidation or merger as well as the resulting or surviving corporation, so that any person who is or was a director, officer, employee or agent of such a constituent corporation or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise shall stand in the same position under the provisions of this Article VII with respect to the resulting or surviving corporation as that person would if he or she had served the resulting or surviving corporation in the same capacity.
SECTION 7.07 Other Enterprises. Fines, and Serving at Corporation's Request. For purposes of this Article VII, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on a person with respect to any employee benefit plan; and references to "serving at the request of the Corporation" shall include any service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner he or she reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the Corporation" as referred to in this Article VII.
13
ARTICLE VIII
Miscellaneous
SECTION 8.01 Seal. The Board shall provide a corporate seal, which shall be in the form of a circle and shall bear the name of the Corporation and words and figures showing that the Corporation was incorporated in the State of Delaware and the year of incorporation.
SECTION 8.02 Waiver of Notices. Whenever notice is required to be given by these Bylaws or the Certificate of Incorporation or by law, the person entitled to said notice may waive such notice in writing, either before or after the time stated therein, and such waiver shall be deemed equivalent to notice.
SECTION 8.03 Amendments. These Bylaws, or any of them, may be altered, amended or repealed, and new Bylaws may be made, (i) by the Board, by vote of a majority of the number of directors then in office as directors, acting at any meeting of the Board, or (ii) by the affirmative vote of the holders of a majority of the total voting power of all outstanding shares of voting stock of the Corporation, at any annual meeting of stockholders, without previous notice, or at any special meeting of stockholders, provided that notice of such proposed amendment, modification, repeal or adoption is given in the notice of special meeting. Any Bylaws made or altered by the stockholders may be altered or repealed by either the Board or the stockholders as provided in this Section 8.03.
14
EXHIBIT 31.1
CERTIFICATION OF CHIEF
EXECUTIVE OFFICER
PURSUANT TO RULE 13a-14(a) AND RULE 15d-14(a)
OF THE
SECURITIES EXCHANGE ACT, AS AMENDED
I, Michael Burdiek, certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q of CalAmp Corp.; | |||||
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |||||
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |||||
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | |||||
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |||||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |||||
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |||||
d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and | |||||
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |||||
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and | ||||||
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
October 6, 2014 | /s/ Michael Burdiek | |||
Date | Michael Burdiek | |||
Chief Executive Officer |
EXHIBIT 31.2
CERTIFICATION OF CHIEF
FINANCIAL OFFICER
PURSUANT TO RULE 13a-14(a) AND RULE 15d-14(a)
OF THE
SECURITIES EXCHANGE ACT, AS AMENDED
I, Richard Vitelle, certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q of CalAmp Corp.; | |||||
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |||||
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |||||
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: | |||||
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |||||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |||||
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |||||
d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and | |||||
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): | |||||
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and | ||||||
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
October 6, 2014 | /s/ Richard Vitelle | |||
Date | Richard Vitelle | |||
Chief Financial Officer |
EXHIBIT 32
CERTIFICATION OF CHIEF
EXECUTIVE OFFICER
AND CHIEF FINANCIAL OFFICER PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of CalAmp Corp. (the "Company") on Form 10-Q for the quarter ended August 31, 2014 as filed with the Securities and Exchange Commission (the "Report"), we, Michael Burdiek, Chief Executive Officer of the Company, and Richard Vitelle, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to our knowledge:
(1) |
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and | ||
(2) |
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Michael Burdiek | |
Michael Burdiek | |
Chief Executive Officer | |
/s/ Richard Vitelle | |
Richard Vitelle | |
Executive Vice President and | |
Chief Financial Officer |
October 6, 2014
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
STOCK-BASED COMPENSATION (Schedule of Stock-based Compensation Expense) (Details) (USD $)
|
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Aug. 31, 2014
|
Aug. 31, 2013
|
Aug. 31, 2014
|
Aug. 31, 2013
|
|
Stock-based compensation expense | $ 936,000 | $ 690,000 | $ 1,756,000 | $ 1,321,000 |
Cost of revenues [Member]
|
||||
Stock-based compensation expense | 58,000 | 42,000 | 110,000 | 81,000 |
Research and development [Member]
|
||||
Stock-based compensation expense | 148,000 | 122,000 | 283,000 | 232,000 |
Selling [Member]
|
||||
Stock-based compensation expense | 126,000 | 87,000 | 239,000 | 158,000 |
General and administrative [Member]
|
||||
Stock-based compensation expense | $ 604,000 | $ 439,000 | $ 1,124,000 | $ 850,000 |
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