##### 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, 2006
 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)
    
  þ o
 þ
 o þ
     ,




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##### 



TABLE OF CONTENTS
 Page
 EXPLANATORY NOTE
    
    
    1PART IIItem 7. Financial Statements
    
    
    1SIGNATURESEXHIBIT INDEXConsent of Grant Thornton LLPSection 302 CertificationSection 302 CertificationSection 1350 CertificationSection 1350 Certification




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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
 1




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
     
 F-1




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##### Table of Contents



XATA CORPORATION
 
 BALANCE SHEETS
 September 30,
    
    
    September 30,2006
    
    
    2005ASSETSCurrent AssetsCash and cash equivalents
    
    $
    6,354,000
    
    
    $
    6,473,000Accounts receivable, less allowances for doubtful accounts
and sales returns of $472,000 and $315,000
    
    
    5,260,000
    
    
    
    7,812,000Inventories
    
    
    2,212,000
    
    
    
    1,257,000Deferred product costs
    
    
    3,433,000
    
    
    
    4,671,000Prepaid expenses
    
    
    270,000
    
    
    
    204,000Total current assets
    
    
    17,529,000
    
    
    
    20,417,000Equipment and leasehold improvements, net
    
    
    2,507,000
    
    
    
    1,085,000Deferred product costs, net of current portion
    
    
    1,687,000
    
    
    
    1,002,000Total assets
    
    $
    21,723,000
    
    
    $
    22,504,000LIABILITIES AND SHAREHOLDERS EQUITYCurrent LiabilitiesBank line of credit
    
    $
    
    
    
    $
    1,800,000Current portion of long-term obligations
    
    
    94,000
    
    
    
    Accounts payable
    
    
    1,688,000
    
    
    
    2,387,000Accrued expenses
    
    
    2,674,000
    
    
    
    2,171,000Deferred revenue
    
    
    6,728,000
    
    
    
    7,774,000Total current liabilities
    
    
    11,184,000
    
    
    
    14,132,000Long-term obligations, net of current portion
    
    
    88,000
    
    
    
    Deferred revenue, net of current portion
    
    
    5,261,000
    
    
    
    3,335,000Total liabilities
    
    
    16,533,000
    
    
    
    17,467,000Shareholders EquityPreferred stock, no par, 5,000,000 shares authorized:Series B, 4% convertible, 2,250,000 shares designated;
1,779,000 and 1,710,000 shares issued and outstanding
    
    
    4,579,000
    
    
    
    4,260,000Series C, convertible, 1,400,000 shares designated;
1,269,000 shares issued and outstanding
    
    
    4,845,000
    
    
    
    4,845,000Common stock, par value $0.01 per share; 25,000,000 shares
authorized; 7,963,000 and 7,549,000 shares issued and outstanding
    
    
    80,000
    
    
    
    76,000Additional paid-in capital
    
    
    23,246,000
    
    
    
    21,458,000Unearned stock based compensation
    
    
    (900,000
    )
    
    
    (1,007,000
    )Accumulated deficit
    
    
    (26,660,000
    )
    
    
    (24,595,000
    )Total shareholders equity
    
    
    5,190,000
    
    
    
    5,037,000Total liabilities and shareholders equity
    
    $
    21,723,000
    
    
    $
    22,504,000
  F-2




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##### Table of Contents



XATA Corporation
 
 STATEMENTS OF OPERATIONS
 Fiscal Years EndedSeptember 30,2006
    
    
    2005Net sales
    
    $
    30,629,000
    
    
    $
    19,303,000Costs and expensesCost of goods sold
    
    
    17,814,000
    
    
    
    12,024,000Selling, general and administrative
    
    
    11,526,000
    
    
    
    9,736,000Research and development
    
    
    3,258,000
    
    
    
    3,622,00032,598,000
    
    
    
    25,382,000Operating loss
    
    
    (1,969,000
    )
    
    
    (6,079,000
    )Non-operating incomeNet interest income
    
    
    163,000
    
    
    
    64,000Other
    
    
    63,000
    
    
    
    35,000226,000
    
    
    
    99,000Net loss before income taxes
    
    
    (1,743,000
    )
    
    
    (5,980,000
    )Income tax expense
    
    
    
    
    
    
    Net loss
    
    
    (1,743,000
    )
    
    
    (5,980,000
    )Preferred stock dividends
    
    
    (178,000
    )
    
    
    (169,000
    )Preferred stock deemed dividend
    
    
    (144,000
    )
    
    
    (587,000
    )Loss to common shareholders
    
    $
    (2,065,000
    )
    
    $
    (6,736,000
    )Loss per common share  basic and diluted:Loss to common shareholders
    
    $
    (0.28
    )
    
    $
    (0.93
    )Weighted average common and
common share equivalentsBasic and Diluted
    
    
    7,484,000
    
    
    
    7,212,000
  F-3




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##### Table of Contents



XATA CORPORATION
 
 STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY
 PERIODS ENDED SEPTEMBER 30, 2006 AND SEPTEMBER 30, 2005
 Series B
    
    Series C
    
    Additional
    
    UnearnedCommon Stock
    
    Preferred Stock
    
    Preferred Stock
    
    Paid-In
    
    Stock-Based
    
    AccumulatedShares
    
    Amount
    
    Shares
    
    Amount
    
    Shares
    
    Amount
    
    Capital
    
    Compensation
    
    Deficit
    
    TotalBalance, September 30, 2004
    
    
    7,254,000
    
    
    $
    73,000
    
    
    
    1,643,000
    
    
    $
    3,923,000
    
    
    
    
    
    
    $
    
    
    
    $
    19,499,000
    
    
    $
    (499,000
    )
    
    $
    (17,860,000
    )
    
    $
    5,136,000Common stock issued on exercise of options
    
    
    118,000
    
    
    
    1,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    404,000
    
    
    
    
    
    
    
    
    
    
    
    405,000Issuance of restricted shares of common stock
    
    
    197,000
    
    
    
    2,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,016,000
    
    
    
    (1,018,000
    )
    
    
    
    
    
    
    Amortization
of unearned stock based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    435,000
    
    
    
    
    
    
    
    435,000Elimination of unearned compensation related to
terminated employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (75,000
    )
    
    
    75,000
    
    
    
    
    
    
    
    Forfeiture of restricted shares of common stock
    
    
    (20,000
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Issuance of common stock warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,000
    
    
    
    
    
    
    
    
    
    
    
    25,000Issuance of preferred stock and warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,269,000
    
    
    
    4,426,000
    
    
    
    589,000
    
    
    
    
    
    
    
    
    
    
    
    5,015,000Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    67,000
    
    
    
    170,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (169,000
    )
    
    
    1,000Preferred stock deemed dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    167,000
    
    
    
    
    
    
    
    419,000
    
    
    
    
    
    
    
    
    
    
    
    (586,000
    )
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,980,000
    )
    
    
    (5,980,000
    )Balance, September 30, 2005
    
    
    7,549,000
    
    
    $
    76,000
    
    
    
    1,710,000
    
    
    $
    4,260,000
    
    
    
    1,269,000
    
    
    $
    4,845,000
    
    
    $
    21,458,000
    
    
    $
    (1,007,000
    )
    
    $
    (24,595,000
    )
    
    $
    5,037,000Common stock issued on exercise of options
    
    
    344,000
    
    
    
    3,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,255,000
    
    
    
    
    
    
    
    
    
    
    
    1,258,000Common stock issued on exercise of warrants
    
    
    9,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Issuance of restricted shares of common stock
    
    
    199,000
    
    
    
    2,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    963,000
    
    
    
    (965,000
    )
    
    
    
    
    
    
    Amortization of unearned stock based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    566,000
    
    
    
    
    
    
    
    566,000Elimination of unearned compensation related to
terminated employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (506,000
    )
    
    
    506,000
    
    
    
    
    
    
    
    Forfeiture of restricted shares of common stock
    
    
    (138,000
    )
    
    
    (1,000
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,000
    
    
    
    
    
    
    
    
    
    
    
    Issuance of common stock warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    75,000
    
    
    
    
    
    
    
    
    
    
    
    75,000Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    69,000
    
    
    
    175,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (178,000
    )
    
    
    (3,000
    )Preferred stock deemed dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    144,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (144,000
    )
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,743,000
    )
    
    
    (1,743,000
    )Balance, September 30, 2006
    
    
    7,963,000
    
    
    $
    80,000
    
    
    
    1,779,000
    
    
    $
    4,579,000
    
    
    
    1,269,000
    
    
    $
    4,845,000
    
    
    $
    23,246,000
    
    
    $
    (900,000
    )
    
    $
    (26,660,000
    )
    
    $
    5,190,000
  F-4




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##### Table of Contents



XATA Corporation
 
 STATEMENTS OF CASH FLOWS
 Twelve Months EndedSeptember 30,2006
    
    
    2005Cash provided by (used in) operating activitiesNet loss
    
    $
    (1,743,000
    )
    
    $
    (5,980,000
    )Adjustments to reconcile net loss to net cash provided by
(used in) operating activities:Depreciation and amortization of equipment and leasehold improvements
    
    
    451,000
    
    
    
    266,000Issuance of warrants for services rendered
    
    
    75,000
    
    
    
    25,000Unearned stock based compensation recognized
    
    
    566,000
    
    
    
    435,000Changes in assets and liabilities:Accounts receivable
    
    
    2,552,000
    
    
    
    (2,311,000
    )Inventories
    
    
    (955,000
    )
    
    
    (190,000
    )Deferred product costs
    
    
    553,000
    
    
    
    (4,858,000
    )Prepaid expenses
    
    
    (66,000
    )
    
    
    27,000Accounts payable
    
    
    (699,000
    )
    
    
    653,000Accrued expenses
    
    
    500,000
    
    
    
    578,000Deferred revenue
    
    
    880,000
    
    
    
    6,950,000Net cash provided by (used in) operating activities
    
    
    2,114,000
    
    
    
    (4,405,000
    )Cash provided by (used in) investing activitiesPurchase of equipment and leasehold improvements
    
    
    (755,000
    )
    
    
    (610,000
    )Additions to software development costs
    
    
    (906,000
    )
    
    
    (285,000
    )Sales of short-term investments
    
    
    
    
    
    
    3,990,000Net cash provided by (used in) investing activities
    
    
    (1,661,000
    )
    
    
    3,095,000Cash
provided by (used in) financing activitiesBorrowings on bank line of credit
    
    
    200,000
    
    
    
    1,800,000Payments on bank line of credit
    
    
    (2,000,000
    )
    
    
    (518,000
    )Proceeds from issuance of preferred stock and warrants
    
    
    
    
    
    
    5,015,000Borrowings on long-term obligations
    
    
    49,000
    
    
    
    Payments on long-term obligations
    
    
    (79,000
    )
    
    
    (252,000
    )Proceeds from options and warrants exercised
    
    
    1,258,000
    
    
    
    405,000Net cash provided by (used in) financing activities
    
    
    (572,000
    )
    
    
    6,450,000Increase (decrease) in cash and cash equivalents
    
    
    (119,000
    )
    
    
    5,140,000Cash and cash equivalentsBeginning
    
    
    6,473,000
    
    
    
    1,333,000Ending
    
    $
    6,354,000
    
    
    $
    6,473,000Supplemental disclosures of cash flow informationCash payments for interest
    
    $
    86,000
    
    
    $
    77,000Supplemental schedule of noncash investing and financing activitiesIssuance of restricted stock
    
    $
    965,000
    
    
    $
    1,018,000Preferred stock deemed dividends
    
    
    144,000
    
    
    
    587,000Unearned compensation for terminated employees
    
    
    506,000
    
    
    
    75,000Preferred stock dividends payable
    
    
    61,000
    
    
    
    58,000Preferred stock dividends paid
    
    
    175,000
    
    
    
    170,000Equipment purchased under capital lease
    
    
    212,000
    
    
    
    
  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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##### Table of Contents



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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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
 Fair Value of Financial Instruments
  Inventories
   September 30,
    
    
    September 30,2006
    
    
    2005Raw materials and subassemblies
    
    $
    786,000
    
    
    $
    686,000Finished goods
    
    
    1,426,000
    
    
    
    571,000Total inventories
    
    $
    2,212,000
    
    
    $
    1,257,000
 Equipment and Leasehold Improvements
   September 30,
    
    
    September 30,2006
    
    
    2005Office furniture and equipment
    
    $
    2,543,000
    
    
    $
    1,661,000Engineering and manufacturing equipment
    
    
    564,000
    
    
    
    454,000Capitalized software development costs
    
    
    1,191,000
    
    
    
    285,000Leasehold improvements
    
    
    34,000
    
    
    
    59,0004,332,000
    
    
    
    2,459,000Less: accumulated depreciation and amortization
    
    
    (1,825,000
    )
    
    
    (1,374,000
    )Equipment and leasehold improvements, net
    
    $
    2,507,000
    
    
    $
    1,085,000
 F-8




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
 Capitalized Software Development Costs
   Long-Lived Assets
  Product Warranties
   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
 F-9




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
 Income taxes
 Accounting for
Income Taxes
 Stock-Based Compensation
 Accounting for Stock Issued to
Employees Accounting for
Stock-Based Compensation
 Fiscal Years EndedSeptember 30,2006
    
    2005Net loss to common shareholders, as reported
    
    $
    (2,065,000
    )
    
    $
    (6,736,000
    )Deduct: Total stock-based
employee compensation expense
determined under fair value based
methods for all awards, net of
related tax effects
    
    
    (62,000
    )
    
    
    (155,000
    )Pro forma net loss to common shareholders
    
    $
    (2,127,000
    )
    
    $
    (6,891,000
    )Basic and diluted net loss to common shareholders
per common shareAs reported
    
    $
    (0.28
    )
    
    $
    (0.93
    )Pro forma
    
    
    (0.28
    )
    
    
    (0.96
    )
 Reclassifications
  F-10




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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 30,2006
    
    
    2005
    
    
    2006
    
    
    2005Percentage of Net Sales
    
    
    Percentage of Ending ReceivableCustomer A
    
    
    18.4%
    
    
    
    *
    
    
    
    9.5%
    
    
    
    *Customer B
    
    
    18.2%
    
    
    
    *
    
    
    
    4.4%
    
    
    
    *
 
 *
  Major Suppliers
  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-11




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 2. Summary of Significant Accounting Policies, continued
  Accounting for Uncertainty in Income Taxes (FIN 48)
 Accounting for Uncertainty in Income Taxes
 Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year
Financial Statement (SAB 108)
 Considering the Effects of
Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements
 Fair Value Measurements (FAS 157)
  Note 3. Bank Line of Credit
  F-12




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 4. Long-Term Liabilities
  Years ending September 30:2007
    
    $
    115,0002008
    
    
    89,0002009
    
    
    7,000Total payments
    
    
    211,000Amounts representing interest
(weighted average 14.2%)
    
    
    (29,000
    )Present value of minimum
capitalized lease payments
    
    $
    182,000
  Note 5. Net Loss Per Share
   F-13




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 6. Income Taxes
  September 30,2006
    
    
    2005Current deferred tax assets:Inventory and warranty reserve
    
    $
    415,000
    
    
    $
    407,000Accrued expenses, deferred revenue and other
    
    
    873,000
    
    
    
    171,000Accounts receivable and sales reserve
    
    
    175,000
    
    
    
    116,0001,463,000
    
    
    
    694,000Non-current deferred tax assets:Product development costs
    
    
    (441,000
    )
    
    
    (105,000
    )Depreciation
    
    
    (8,000
    )
    
    
    (39,000
    )Research and development credit
    
    
    1,191,000
    
    
    
    1,166,000Net operating loss carryforwards
    
    
    8,160,000
    
    
    
    7,880,0008,902,000
    
    
    
    8,902,000Total deferred tax asset
    
    
    10,365,000
    
    
    
    9,596,000Less: valuation allowance
    
    
    (10,365,000
    )
    
    
    (9,596,000
    )Net deferred tax asset
    
    $
    
    
    
    $
    
  F-14




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 6. Income Taxes, continued
  September 302006
    
    
    2005Statutory federal rate applied to loss before income taxes
    
    $
    (593,000
    )
    
    $
    (2,033,000
    )State income tax benefit
    
    
    (52,000
    )
    
    
    (179,000
    )Permanent differences
    
    
    (67,000
    )
    
    
    4,000Change in valuation allowance
    
    
    769,000
    
    
    
    2,401,000Research and development credit
    
    
    (25,000
    )
    
    
    (190,000
    )Other
    
    
    (32,000
    )
    
    
    (3,000
    )$
    
    
    
    $
    Current
    
    $
    
    
    
    $
    Deferred
    
    
    
    
    
    
    $
    
    
    
    $
    
  Note 7. Commitments
 Leases
   Years ending September 30:2007
    
    $
    93,0002008
    
    
    1,0002009
    
    
    1,0002010
    
    
    1,0002011
    
    
    1,000Total
    
    $
    97,000
  Reseller Commitment
  F-15




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##### Table of Contents



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




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note
8. Shareholders Equity, continued
    Series C
     F-17




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note
8. Shareholders Equity, continued
 Stock Option Plans
  F-18




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 8. Shareholders Equity, continued
  2006
    
    2005Weighted-
    
    
    
    
    
    Weighted-Average
    
    
    
    
    
    AverageShares
    
    Exercise Price
    
    Shares
    
    Exercise PriceOptions outstanding at beginning of year
    
    
    558,053
    
    
    $
    3.84
    
    
    
    690,288
    
    
    $
    3.76Options granted
    
    
    198,750
    
    
    
    5.09
    
    
    
    25,000
    
    
    
    5.23Options exercised
    
    
    (355,952
    )
    
    
    3.71
    
    
    
    (117,884
    )
    
    
    3.43Options canceled
    
    
    (12,800
    )
    
    
    3.76
    
    
    
    (39,351
    )
    
    
    4.48Options outstanding at end of year
    
    
    388,051
    
    
    $
    4.60
    
    
    
    558,053
    
    
    $
    3.84
 Options Outstanding
    
    Options ExercisableWeighted-Number
    
    Average
    
    
    
    
    
    NumberOutstanding at
    
    Remaining
    
    Weighted
    
    Exercisable at
    
    WeightedSeptember 30,
    
    Contractual
    
    Average
    
    September 30,
    
    AverageRange of exercise price
    
    2006
    
    Life (Years)
    
    Exercise Price
    
    2006
    
    Exercise Price$2.85 - $3.03
    
    
    20,000
    
    
    
    1.45
    
    
    $
    2.98
    
    
    
    20,000
    
    
    $
    2.98$3.37 - $3.99
    
    
    103,695
    
    
    
    1.31
    
    
    
    3.83
    
    
    
    102,695
    
    
    
    3.84$4.18 - $5.23
    
    
    264,356
    
    
    
    4.51
    
    
    
    5.03
    
    
    
    85,606
    
    
    
    4.83388,051
    
    
    
    3.50
    
    
    $
    4.60
    
    
    
    208,301
    
    
    $
    4.16
  Restricted Stock Awards
   F-19




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##### Table of Contents



XATA
CORPORATION
 NOTES TO FINANCIAL STATEMENTS
 Note 8. Shareholders Equity, continued
 Common stock warrants
   Weighed-Average
    
    Weighted AverageDate
    
    Warrants Outstanding
    
    Exercise Price
    
    Remaining LifeSeptember 30, 2006
    
    
    1,033,000
    
    
    $
    3.49
    
    
    2.99 yearsSeptember 30, 2005
    
    
    1,019,000
    
    
    $
    3.43
    
    
    3.83 years
 Note 9. Related Party Transactions
   F-20




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##### Table of Contents



SIGNATURES
  XATA CORPORATIONDated:
March 7, 2007
    
    By:
    
    /s/ John J. Coughlan

John J. Coughlan, Chairman and Chief Executive Officer(Principal executive officer)
 Dated:  March 7, 2007
    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