##### Table of Contents



Form 10-KSB/A
 AMENDMENT NO. 1
 U.S. SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
  þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended: September 30, 2005
 o
    
    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number: 0-27166
 XATA
CORPORATION
  Minnesota
    
    41-1641815(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 151 East Cliff Road, Suite 10, Burnsville, Minnesota
    
    55337(Address of principal executive offices)
    
    (Zip Code)
   
  o
 þ o
 o
 o þ




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,




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##### 



TABLE OF CONTENTS
  
 PageEXPLANATORY NOTE
    
    
    1PART IIItem 7. Financial Statements
    
    
    1SIGNATURESEXHIBIT INDEXConsent of Grant Thornton LLPCertification Pursuant to Section 302Certification Pursuant to Section 302Certification Pursuant to Section 906Certification Pursuant to Section 906




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##### Table of Contents



Explanatory Note
    
 PART II
 
 Item 7. Financial Statements
 Report of Independent Registered Public Accounting Firm
    
    F-1Balance Sheets
    
    F-2Statements of Operations
    
    F-3Statements of Changes in Shareholders Equity
    
    F-4Statements of Cash Flows
    
    F-5Notes to Financial Statements
    
    F-6 - F-20




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
     
 F - 1




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XATA CORPORATION
BALANCE SHEETS
 September 30,2005
    
    
    2004ASSETSCurrent AssetsCash and cash equivalents
    
    $
    6,472,993
    
    
    $
    1,332,695Short-term investments
    
    
    
    
    
    
    3,989,802Accounts receivable, less allowances for doubtful accounts
and sales returns of $315,000 and $293,000
    
    
    7,811,531
    
    
    
    5,500,832Inventories
    
    
    1,257,541
    
    
    
    1,067,034Deferred product costs
    
    
    4,671,386
    
    
    
    511,079Prepaid expenses
    
    
    203,596
    
    
    
    230,809Total current assets
    
    
    20,417,047
    
    
    
    12,632,251Equipment and leasehold improvements, net
    
    
    1,085,139
    
    
    
    456,030Deferred product costs, net of current portion
    
    
    1,001,481
    
    
    
    303,481Total assets
    
    $
    22,503,667
    
    
    $
    13,391,762LIABILITIES AND SHAREHOLDERS EQUITYCurrent LiabilitiesBank line of credit
    
    $
    1,800,000
    
    
    $
    518,008Current maturities of long-term debt
    
    
    
    
    
    
    231,403Accounts payable
    
    
    2,386,907
    
    
    
    1,733,932Accrued expenses
    
    
    2,170,764
    
    
    
    1,592,808Deferred revenue
    
    
    7,774,293
    
    
    
    2,657,882Total current liabilities
    
    
    14,131,964
    
    
    
    6,734,033Long-Term Debt, net of current maturities
    
    
    
    
    
    
    19,969Deferred Revenue, net of current portion
    
    
    3,335,383
    
    
    
    1,501,799Total liabilities
    
    
    17,467,347
    
    
    
    8,255,801Commitments
    
    
    
    
    
    
    Shareholders EquityPreferred stock, no par, 5,000,000 shares authorized:Series B, 4% convertible, 2,250,000 shares designated;
1,710,060 and 1,643,304 shares issued and outstanding
    
    
    4,259,835
    
    
    
    3,922,532Series C, convertible, 1,400,000 shares designated;
1,269,036 shares issued and outstanding
    
    
    4,845,173
    
    
    
    Common stock, par value $0.01 per share; 25,000,000 shares
authorized; 7,549,180 and 7,253,785 shares issued and outstanding
    
    
    75,491
    
    
    
    72,538Additional paid-in capital
    
    
    21,458,389
    
    
    
    19,498,960Deferred stock based compensation
    
    
    (1,007,197
    )
    
    
    (498,463
    )Accumulated deficit
    
    
    (24,595,371
    )
    
    
    (17,859,606
    )Total shareholders equity
    
    
    5,036,320
    
    
    
    5,135,961Total liabilities and shareholders equity
    
    $
    22,503,667
    
    
    $
    13,391,762
  F - 2




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XATA CORPORATION
STATEMENTS OF OPERATIONS
 Years Ended September 30,2005
    
    
    2004Net sales
    
    $
    19,302,489
    
    
    $
    18,931,579Cost of goods sold
    
    
    14,994,438
    
    
    
    12,599,328Gross profit
    
    
    4,308,051
    
    
    
    6,332,251Operating expensesSelling, general and administrative
    
    
    6,765,679
    
    
    
    5,060,261Research and development
    
    
    3,622,077
    
    
    
    2,428,06510,387,756
    
    
    
    7,488,326Operating loss
    
    
    (6,079,705
    )
    
    
    (1,156,075
    )Non-operating income (expense)Interest income
    
    
    95,594
    
    
    
    28,110Interest expense
    
    
    (31,688
    )
    
    
    (77,350
    )Other
    
    
    35,562
    
    
    
    14,35199,468
    
    
    
    (34,889
    )Net loss before income taxes
    
    
    (5,980,237
    )
    
    
    (1,190,964
    )Income taxes
    
    
    
    
    
    
    Net loss
    
    
    (5,980,237
    )
    
    
    (1,190,964
    )Preferred stock dividends
    
    
    (169,004
    )
    
    
    (135,851
    )Preferred stock deemed dividend
    
    
    (586,524
    )
    
    
    (729,912
    )Net loss to common shareholders
    
    $
    (6,735,765
    )
    
    $
    (2,056,727
    )Net loss per common share  basic and diluted:Net loss to common shareholders
    
    $
    (0.93
    )
    
    $
    (0.29
    )Weighted average common and
common share equivalentsBasic and Diluted
    
    
    7,211,866
    
    
    
    7,021,573
  F - 3




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XATA CORPORATION
STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY
YEARS ENDED SEPTEMBER 30, 2005 AND 2004
 Series B
    
    
    Series C
    
    
    Additional
    
    
    DeferredCommon Stock
    
    
    Preferred Stock
    
    
    Preferred Stock
    
    
    Paid-In
    
    
    Stock-Based
    
    
    AccumulatedShares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Shares
    
    
    Amount
    
    
    Capital
    
    
    Compensation
    
    
    Deficit
    
    
    TotalBalance, September 30, 2003
    
    
    6,938,575
    
    
    $
    69,386
    
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    
    
    
    $
    17,767,539
    
    
    $
    
    
    
    $
    (15,802,879
    )
    
    $
    2,034,046Common stock issued on exercise of options
    
    
    147,220
    
    
    
    1,472
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    418,329
    
    
    
    
    
    
    
    
    
    
    
    419,801Common stock issued on exercise of warrants
    
    
    28,470
    
    
    
    285
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    34,512
    
    
    
    
    
    
    
    
    
    
    
    34,797Issuance of restricted shares of common stock
    
    
    139,520
    
    
    
    1,395
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    601,815
    
    
    
    (603,210
    )
    
    
    
    
    
    
    Amortization of deferred stock based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    104,747
    
    
    
    
    
    
    
    104,747Issuance of common stock warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,000
    
    
    
    
    
    
    
    
    
    
    
    25,000Issuance of preferred stock and warrants
    
    
    
    
    
    
    
    
    
    
    1,612,903
    
    
    
    3,115,398
    
    
    
    
    
    
    
    
    
    
    
    651,765
    
    
    
    
    
    
    
    
    
    
    
    3,767,163Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    30,401
    
    
    
    77,222
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (135,851
    )
    
    
    (58,629
    )Preferred stock deemed dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    729,912
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (729,912
    )
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,190,964
    )
    
    
    (1,190,964
    )Balance, September 30, 2004
    
    
    7,253,785
    
    
    $
    72,538
    
    
    
    1,643,304
    
    
    $
    3,922,532
    
    
    
    
    
    
    $
    
    
    
    $
    19,498,960
    
    
    $
    (498,463
    )
    
    $
    (17,859,606
    )
    
    $
    5,135,961Common stock issued on exercise of options
    
    
    117,884
    
    
    
    1,178
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    403,720
    
    
    
    
    
    
    
    
    
    
    
    404,898Common stock issued on exercise of warrants
    
    
    55
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Issuance of restricted shares of common stock
    
    
    197,100
    
    
    
    1,971
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,016,263
    
    
    
    (1,018,234
    )
    
    
    
    
    
    
    Amortization of deferred stock based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    434,973
    
    
    
    
    
    
    
    434,973Elimination of deferred compensation related to
terminated employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (74,527
    )
    
    
    74,527
    
    
    
    
    
    
    
    Forfeiture of restricted shares of common stock
    
    
    (19,644
    )
    
    
    (196
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    196
    
    
    
    
    
    
    
    
    
    
    
    Issuance of common stock warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,000
    
    
    
    
    
    
    
    
    
    
    
    25,000Issuance of preferred stock and warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,269,036
    
    
    
    4,426,391
    
    
    
    588,777
    
    
    
    
    
    
    
    
    
    
    
    5,015,168Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    66,756
    
    
    
    169,561
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (169,004
    )
    
    
    557Preferred stock deemed dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    167,742
    
    
    
    
    
    
    
    418,782
    
    
    
    
    
    
    
    
    
    
    
    (586,524
    )
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,980,237
    )
    
    
    (5,980,237
    )Balance, September 30, 2005
    
    
    7,549,180
    
    
    $
    75,491
    
    
    
    1,710,060
    
    
    $
    4,259,835
    
    
    
    1,269,036
    
    
    $
    4,845,173
    
    
    $
    21,458,389
    
    
    $
    (1,007,197
    )
    
    $
    (24,595,371
    )
    
    $
    5,036,320
  F - 4




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##### Table of Contents



XATA CORPORATION
STATEMENTS OF CASH FLOWS
 Years Ended September 30,2005
    
    
    2004Cash provided by (used in) operating activitiesNet loss
    
    $
    (5,980,237
    )
    
    $
    (1,190,964
    )Adjustments to reconcile net loss to net cash provided by
(used in) operating activities:Depreciation and amortization of equipment and leasehold improvements
    
    
    265,988
    
    
    
    182,431Amortization of capitalized software development costs
    
    
    
    
    
    
    1,319,190Deferred compensation recognized
    
    
    434,973
    
    
    
    104,747Issuance of warrants for services rendered
    
    
    25,000
    
    
    
    25,000Changes in assets and liabilities:Accounts receivable, net
    
    
    (2,310,699
    )
    
    
    (1,961,894
    )Inventories
    
    
    (190,507
    )
    
    
    (123,881
    )Deferred product costs
    
    
    (4,858,307
    )
    
    
    (509,149
    )Prepaid expenses
    
    
    27,213
    
    
    
    (107,786
    )Accounts payable
    
    
    652,975
    
    
    
    271,757Accrued expenses
    
    
    578,513
    
    
    
    739,212Deferred revenue
    
    
    6,949,995
    
    
    
    2,413,347Net cash provided by (used in) operating activities
    
    
    (4,405,093
    )
    
    
    1,162,010Cash provided by (used in) investing activitiesPurchase of equipment
    
    
    (610,366
    )
    
    
    (219,035
    )Additions to software development costs
    
    
    (284,731
    )
    
    
    Purchases of short-term investments
    
    
    
    
    
    
    (3,989,802
    )Sales of short-term investments
    
    
    3,989,802
    
    
    
    Net cash provided by (used in) investing activities
    
    
    3,094,705
    
    
    
    (4,208,837
    )Cash provided by (used in) financing activitiesNet borrowings (payments) on bank line of credit
    
    
    1,281,992
    
    
    
    (274,176
    )Payments on long-term debt
    
    
    (251,372
    )
    
    
    (175,817
    )Net proceeds from issuance of preferred stock and warrants
    
    
    5,015,168
    
    
    
    3,767,163Proceeds from options and warrants exercised
    
    
    404,898
    
    
    
    454,598Net cash provided by financing activities
    
    
    6,450,686
    
    
    
    3,771,768Increase in cash and cash equivalents
    
    
    5,140,298
    
    
    
    724,941Cash and cash equivalentsBeginning
    
    
    1,332,695
    
    
    
    607,754Ending
    
    $
    6,472,993
    
    
    $
    1,332,695Supplemental disclosures of cash flow informationCash payments for interest
    
    $
    31,031
    
    
    $
    77,350Supplemental schedule of noncash investing and financing activitiesRestricted stock
    
    $
    1,018,234
    
    
    $
    603,210Preferred stock deemed dividends
    
    $
    586,524
    
    
    $
    729,912Deferred compensation for terminated employees
    
    $
    74,527
    
    
    $
    Forfeitures of restricted stock
    
    $
    196
    
    
    $
    
  F - 5




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 1. Description of Business
  Note 2. Summary of Significant Accounting Policies
 Revenue Recognition
 Software Revenue Recognition Software Revenue Recognition with Respect to Certain Transactions Revenue Recognition in Financial
Statements
   F - 6




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XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
   Segment Reporting
  Use of Estimates
  Cash Equivalents and Short-Term Investments
   Concentration of Credit Risk
  F - 7




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XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
  Fair value of Financial Instruments
  Inventories
  Equipment and Leasehold Improvements
  F - 8




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XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
  September 30,2005
    
    
    2004Office furniture and equipment
    
    $
    1,661,512
    
    
    $
    1,150,962Engineering and manufacturing equipment
    
    
    453,789
    
    
    
    388,424Capitalized software development costs
    
    
    284,731
    
    
    
    Leasehold improvements
    
    
    59,399
    
    
    
    24,9482,459,431
    
    
    
    1,564,334Less: accumulated depreciation and amortization
    
    
    (1,374,292
    )
    
    
    (1,108,304
    )Property and equipment, net
    
    $
    1,085,139
    
    
    $
    456,030
   Long-Lived Assets
  Product Warranties
   F - 9




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
 Shipping and Handling Costs
  Advertising Costs
  Research and Development Costs
 Accounting for the
Costs of Computer Software Developed or Obtained for Internal Use Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed
 Income taxes
 Accounting for
Income Taxes
 F - 10




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
 Stock-Based Compensation
 Accounting for Stock Issued to
Employees Accounting for
Stock-Based Compensation
 2005
    
    
    2004Net loss to common shareholders, as reported
    
    $
    (6,735,765
    )
    
    $
    (2,056,727
    )Deduct: Total stock-based employee compensation expense
determined under fair value based
methods for all awards, net of
related tax effects
    
    
    (155,000
    )
    
    
    (269,000
    )Pro forma net loss
    
    $
    (6,890,765
    )
    
    $
    (2,325,727
    )Basic and diluted net loss per common shareAs reported
    
    $
    (0.93
    )
    
    $
    (0.29
    )Pro forma
    
    
    (0.96
    )
    
    
    (0.33
    )
 Reclassifications
  F - 11




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
 Major Customers
  Year Ended September 30,2005
    
    2004
    
    2005
    
    2004Percentage of Net Sales
    
    Balance of Ending ReceivableCustomer A
    
    
    *
    
    
    
    27.0
    %
    
    
    *
    
    
    $
    1,006,000
 
 *
    
    Customer total was less than 10 percent of net sales or ending receivable.  Recently Issued Accounting Standards
 Shared-Based Payment (Statement 123)
 Shared-Based Payment, Accounting for
Stock-Based Compensation. Accounting for Stock
Issued to Employees, Statement of Cash Flows.
 Accounting Changes and Error Corrections (Statement 154)
 Accounting Changes and Error Corrections  a
replacement of APB Opinion No. 20 and FASB Statement No. 3 Accounting Changes
 F - 12




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XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
  Exchange of Nonmonetary Assets (Statement 153)
 Exchange of Nonmonetary Assets
 Note 3. Inventories
  September 30,2005
    
    
    2004Raw materials and subassemblies
    
    $
    686,443
    
    
    $
    552,108Finished goods
    
    
    571,098
    
    
    
    514,926Total inventories
    
    $
    1,257,541
    
    
    $
    1,067,034
 Note 4. Bank Line of Credit
  Note 5. Long-Term Debt
  F - 13




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XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 6. Net Loss Per Share
   2005
    
    
    2004Net loss
    
    $
    (5,980,237
    )
    
    $
    (1,190,964
    )Less: preferred stock dividend
    
    
    (169,004
    )
    
    
    (135,851
    )Less: preferred stock deemed dividend
    
    
    (586,524
    )
    
    
    (729,912
    )Net loss to common shareholders
    
    
    (6,735,765
    )
    
    
    (2,056,727
    )Weighted average shares outstanding
    
    
    7,211,866
    
    
    
    7,021,573Basic and diluted loss per share
    
    $
    (0.93
    )
    
    $
    (0.29
    )
  Note 7. Income Taxes
  September 30,2005
    
    
    2004Current deferred tax assets:Inventory and warranty reserve
    
    $
    407,000
    
    
    $
    235,000Accrued expenses, deferred revenue and other
    
    
    171,000
    
    
    
    125,000Accounts receivable and sales reserve
    
    
    116,000
    
    
    
    109,000694,000
    
    
    
    469,000Non-current deferred tax assets:Software development costs
    
    
    (105,000
    )
    
    
    Depreciation
    
    
    (39,000
    )
    
    
    (40,000
    )Research and development credit
    
    
    1,166,000
    
    
    
    976,000Net operating loss carryforwards
    
    
    7,880,000
    
    
    
    5,790,0008,902,000
    
    
    
    6,726,000Total deferred tax asset
    
    
    9,596,000
    
    
    
    7,195,000Less: valuation allowance
    
    
    (9,596,000
    )
    
    
    (7,195,000
    )Net deferred tax asset
    
    $
    
    
    
    $
    
 F - 14




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 7. Income Taxes, continued
   September 302005
    
    
    2004Statutory federal rate applied to loss before income taxes
    
    $
    (2,033,000
    )
    
    $
    (405,000
    )State income tax benefit
    
    
    (179,000
    )
    
    
    (36,000
    )Permanent differences
    
    
    4,000
    
    
    
    10,000Change in valuation allowance
    
    
    2,401,000
    
    
    
    591,000Research and development credit
    
    
    (190,000
    )
    
    
    (159,000
    )Other
    
    
    (3,000
    )
    
    
    (1,000
    )$
    
    
    
    $
    Current
    
    $
    
    
    
    $
    Deferred
    
    
    
    
    
    
    $
    
    
    
    $
    
   Note 8. Commitments
 Leases
   Years ending September 30:2006
    
    $
    180,0002007
    
    
    54,000
 F - 15




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 8. Commitments, continued
  Reseller Commitment
  401(k) Plan
  Note 9. Shareholders Equity
 Common Stock
  Preferred Stock
  Series B
  F - 16




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 9. Shareholders Equity, continued
       Series C
  F - 17




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 9. Shareholders Equity, continued
      Stock Option Plans
  F - 18




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 9. Shareholders Equity, continued
  2005
    
    
    2004Weighted-
    
    
    
    
    
    
    Weighted-Average
    
    
    
    
    
    
    AverageShares
    
    
    Exercise Price
    
    
    Shares
    
    
    Exercise PriceOptions outstanding at beginning of year
    
    
    689,788
    
    
    $
    3.76
    
    
    
    828,115
    
    
    $
    3.56Options granted
    
    
    25,000
    
    
    
    5.23
    
    
    
    28,000
    
    
    
    3.96Options exercised
    
    
    (117,884
    )
    
    
    3.43
    
    
    
    (147,220
    )
    
    
    2.85Options canceled
    
    
    (39,351
    )
    
    
    4.48
    
    
    
    (19,107
    )
    
    
    2.62Options outstanding at end of year
    
    
    557,553
    
    
    $
    3.84
    
    
    
    689,788
    
    
    $
    3.76
 Options Outstanding
    
    
    Options ExercisableWeighted-Number
    
    
    Average
    
    
    
    
    
    
    NumberOutstanding at
    
    
    Remaining
    
    
    Weighted
    
    
    Exercisable at
    
    
    WeightedSeptember 30,
    
    
    Contractual
    
    
    Average
    
    
    September 30,
    
    
    AverageRange of exercise price
    
    2005
    
    
    Life (Years)
    
    
    Exercise Price
    
    
    2005
    
    
    Exercise Price$2.38 - $3.25
    
    
    128,350
    
    
    
    0.69
    
    
    $
    3.02
    
    
    
    128,350
    
    
    $
    3.02$3.30 - $4.00
    
    
    221,097
    
    
    
    1.65
    
    
    
    3.73
    
    
    
    188,698
    
    
    
    3.72$4.13 - $5.23
    
    
    208,106
    
    
    
    1.81
    
    
    
    4.46
    
    
    
    201,237
    
    
    
    4.47557,553
    
    
    
    1.49
    
    
    $
    3.84
    
    
    
    518,285
    
    
    $
    3.84
  Restricted Stock Awards
   F - 19




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##### Table of Contents



XATA Corporation
 NOTES TO FINANCIAL STATEMENTS
 Note 9. Shareholders Equity, continued
 Common stock warrants
   Weighed-Average
    
    Weighted AverageDate
    
    Warrants Outstanding
    
    Exercise Price
    
    Remaining LifeSeptember 30, 2005
    
    
    1,019,026
    
    
    $
    3.43
    
    
    3.83 yearsSeptember 30, 2004
    
    
    639,105
    
    
    $
    3.10
    
    
    4.13 years
 Note 10. Related Party Transactions
  Note 11. Subsequent Events (unaudited)
 .
 F - 20




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##### Table of Contents



SIGNATURES
  XATA CORPORATIONDated:  December 29, 2005
    By:
    /s/          Craig S. FawcettCraig S. Fawcett, Chairman and Chief Executive Officer (Principal executive officer) Dated:  December 29, 2005
    By:
    /s/          Mark E. TiesMark E. Ties, Chief Financial Officer(Principal  accounting and financial
officer)




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##### Table of Contents



INDEX TO EXHIBITS
 IndexNumber
    
    Description23
    
    Consent of Grant Thornton LLP, independent registered public accounting firm31.1
    
    Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002