UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 FOR THE FISCAL YEAR ENDED FEBRUARY 28, 2010
 COMMISSION FILE NUMBER: 0-12182
 
 CALAMP CORP.
  Delaware
    
    95-3647070(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)1401 N. Rice AvenueOxnard, California
(Address of principal executive offices)
    
    93030
(Zip Code)
 805) 987-9000
 
  TITLE OF EACH CLASS
    
    NAME OF EACH EXCHANGENone
    
    None
  $.01 par value Common Stock
    
    Nasdaq Global Select Market(Title of Class)
    
    (Name of each exchange on which registered)
 Yes o No þ
 Yes o No þ
 þ o
 Yes o No o
 þ
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller Reporting Company þ(Do not check if a smaller reporting company)
 o þ
  DOCUMENTS INCORPORATED BY REFERENCE




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PART I
 ITEM 1. BUSINESS
 THE COMPANY
  WIRELESS DATACOM
  
    
    Optimizing and automating electricity distribution and ancillary utility functions;
 
    
    Facilitating communication and coordination among emergency first-responders;
 
    
    Increasing productivity and optimizing activities of mobile workforces;
 
    
    Improving management control over valuable remote and mobile assets; and
 
    
    Enabling novel applications in a wirelessly connected world.
  Wireless Networks
    Mobile Resource Management (MRM)
   2




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##### 



SATELLITE
     MANUFACTURING
    ISO 9001 INTERNATIONAL CERTIFICATION
   3




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##### 



RESEARCH AND DEVELOPMENT
   SALES AND MARKETING
     Year Ended February 28,Customer
    
    Segment
    
    2010
    
    
    2009
    
    
    2008EchoStar
    
    Satellite
    
    
    48.6
    %
    
    
    15.7
    %
    
    
    10.9
    %DirecTV
    
    Satellite
    
    
    
    
    
    
    10.3
    %
    
    
    23.9
    %EFJ
    
    Wireless
    
    
    3.9
    %
    
    
    9.0
    %
    
    
    14.2
    %
  COMPETITION
   4




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##### 



Wireless DataCom
  Satellite
  BACKLOG
  INTELLECTUAL PROPERTY
  Trademarks
  EMPLOYEES
  EXECUTIVE OFFICERS
  NAME
    
    AGE
    
    
    POSITIONRichard Gold
    
    
    55
    
    
    Director and Chief Executive OfficerMichael Burdiek
    
    
    50
    
    
    President and Chief Operating OfficerGaro Sarkissian
    
    
    43
    
    
    Vice President, Corporate DevelopmentRichard Vitelle
    
    
    56
    
    
    Vice President, Finance, Chief Financial Officer
and Corporate Secretary
    5




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##### 



AVAILABLE INFORMATION
   ITEM 1A. RISK FACTORS
  The Company is dependent on its major customer, the loss of which could have a material adverse
effect on the Companys future sales and its ability to grow.
  We do not currently have long-term contracts with customers and our customers may cease purchasing
products at any time, which could significantly harm our revenues.
   6




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##### 



Because the markets in which we compete are highly competitive and many of our competitors have
greater resources than us, we cannot be certain that our products will continue to be accepted in
the marketplace or capture increased market share.
   Our business is subject to many factors that could cause our quarterly or annual operating results
to fluctuate and our stock price to continue to be volatile.
  
    
    the timing and amount of, or cancellation or rescheduling of, orders for our products;
 
    
    our ability to develop, introduce, ship and support new products and product
enhancements and manage product transitions;
 
    
    announcements, new product introductions and reductions in the price of products offered
by our competitors;
 
    
    our ability to achieve cost reductions;
 
    
    our ability to obtain sufficient supplies of sole or limited source components for our
products;
 
    
    our ability to achieve and maintain production volumes and quality levels for our
products;
 
    
    our ability to maintain the volume of products sold and the mix of distribution channels
through which they are sold;
 
    
    the loss of any one of our major customers or a significant reduction in orders from
those customers;
 
    
    increased competition, particularly from larger, better capitalized competitors;
 
    
    fluctuations in demand for our products and services; and
 
    
    telecommunications and wireless market conditions specifically and economic conditions
generally.
  Because some of our components, assemblies and electronics manufacturing services are purchased
from sole source suppliers or require long lead times, our business is subject to unexpected
interruptions, which could cause our operating results to suffer.
   7




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##### 



If we do not meet product introduction deadlines, our business could be adversely affected.
  If demand for our products fluctuates rapidly and unpredictably, it may be difficult to manage the
business efficiently, which may result in reduced gross margins and profitability.
  Because we currently sell, and we intend to grow the sales of, certain of our products in countries
other than the United States, we are subject to different regulatory schemes. We may not be able
to develop products that comply with the standards of different countries, which could result in
our inability to sell our products and, further, we may be subject to political, economic, and
other conditions affecting such countries, which could result in reduced sales of our products and
which could adversely affect our business.
     8




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##### 



We may not be able to adequately protect our intellectual property, and our competitors may be able
to offer similar products and services that would harm our competitive position.
  We may be subject to infringement claims that may disrupt the conduct of our business and affect
our profitability.
  Availability of radio frequencies may restrict the growth of the wireless communications industry
and demand for our products.
   A failure to rapidly transition or to transition at all to newer digital technologies could
adversely affect our business.
   9




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##### 



We depend to some extent upon wireless networks owned and controlled by others, unproven business
models, and emerging wireless carrier models to deliver existing services and to grow.
  New laws and regulations that impact our industry could increase costs or reduce opportunities for
us to earn revenue.
  CalAmp  s products are subject to mandatory regulatory approvals in the United States and other
countries that are subject to change, making compliance costly and unpredictable.
   Reduced consumer or corporate spending due to the global economic downturn that began in 2008 and
other uncertainties in the macroeconomic environment have affected and could continue to adversely
affect our revenues and cash flow.
  Our ability to make payments of principal and interest on our indebtedness depends upon our future
financial performance and ability to generate positive operating cash flows, which is subject to
general economic conditions, industry cycles and financial, business and other factors affecting
our consolidated operations, many of which are beyond our control.
  
    
    refinance or restructure all or a portion of our indebtedness;
 
    
    obtain additional financing in the debt or equity markets;
  10




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##### 




    
    sell selected assets or businesses;
 
    
    reduce or delay planned capital expenditures; or
 
    
    reduce or delay planned operating expenditures.
  Rises in interest rates could adversely affect our financial condition.
  Risks Relating to Our Common Stock and the Securities Market
 Anti-takeover defenses in our charter and under Delaware law could prevent us from being acquired
or limit the price that investors might be willing to pay for our common stock in an acquisition.
  The trading price of shares of our common stock may be affected by many factors and the price of
shares of our common stock could decline.
  
    
    actual or anticipated fluctuations in revenues or operating results;
 
    
    failure to meet securities analysts or investors expectations of performance;
 
    
    changes in key management personnel;
 
    
    announcements of technological innovations or new products by CalAmp or its competitors;
 
    
    developments in or disputes regarding patents and proprietary rights;
 
    
    proposed and completed acquisitions by us or our competitors;
 
    
    the mix of products and services sold;
 
    
    the timing, placement and fulfillment of significant orders;
 
    
    product and service pricing and discounts;
 
    
    acts of war or terrorism; and
 
    
    general economic conditions.
  11




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##### 



Our stock price is highly volatile and we expect it to remain highly volatile.
  
    
    substantial volatility in quarterly revenues and earnings due to our current dependence
on a small number of major customers;
 
    
    comments by securities analysts; and
 
    
    our failure to meet market expectations.
  Lack of expected dividends may make our stock less attractive as an investment.
  ITEM 1B. UNRESOLVED STAFF COMMENTS
  ITEM 2. PROPERTIES
  SquareLocation
    
    Footage
    
    UseOxnard, California
    
    
    98,000
    
    
    Corporate office, Satellite segment
offices and manufacturing plantSan Diego, California
    
    
    22,000
    
    
    Wireless DataCom officesIrvine, California
    
    
    7,000
    
    
    Wireless DataCom officesAtlanta, Georgia
    
    
    6,000
    
    
    Wireless DataCom officesChaska, Minnesota
    
    
    4,000
    
    
    Product design facilityWaseca, Minnesota
    
    
    34,000
    
    
    Wireless DataCom offices and
manufacturing plantMontreal, Quebec, Canada
    
    
    8,000
    
    
    Wireless DataCom offices
  12




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##### 



ITEM 3. LEGAL PROCEEDINGS
    PART II
 ITEM 5.
    
    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
  LOW
    
    
    HIGHFiscal Year Ended February 28, 20101st Quarter
    
    $
    0.37
    
    
    $
    1.222nd Quarter
    
    
    0.71
    
    
    
    2.273rd Quarter
    
    
    1.91
    
    
    
    3.614th Quarter
    
    
    2.46
    
    
    
    3.77Fiscal Year Ended February 28, 20091st Quarter
    
    $
    2.41
    
    
    $
    3.442nd Quarter
    
    
    1.67
    
    
    
    2.603rd Quarter
    
    
    0.46
    
    
    
    2.604th Quarter
    
    
    0.41
    
    
    
    1.14
   13




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##### 



ITEM 6. SELECTED FINANCIAL DATA
 Year Ended February 28,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006(In thousands except per share amounts)OPERATING DATARevenues
    
    $
    112,113
    
    
    $
    98,370
    
    
    $
    140,907
    
    
    $
    211,714
    
    
    $
    196,908Cost of revenues
    
    
    89,723
    
    
    
    60,244
    
    
    
    122,412
    
    
    
    166,279
    
    
    
    151,319Gross profit
    
    
    22,390
    
    
    
    38,126
    
    
    
    18,495
    
    
    
    45,435
    
    
    
    45,589Operating expenses:Research and development
    
    
    10,943
    
    
    
    12,899
    
    
    
    15,710
    
    
    
    12,989
    
    
    
    8,018Selling
    
    
    9,542
    
    
    
    8,959
    
    
    
    10,633
    
    
    
    6,765
    
    
    
    2,715General and administrative
    
    
    10,523
    
    
    
    12,087
    
    
    
    14,966
    
    
    
    9,792
    
    
    
    6,685Intangible asset amortization
    
    
    1,367
    
    
    
    4,429
    
    
    
    6,418
    
    
    
    3,463
    
    
    
    778Write-off of acquired in-process
research and development
    
    
    
    
    
    
    
    
    
    
    310
    
    
    
    6,850
    
    
    
    310Impairment loss
    
    
    
    
    
    
    44,736
    
    
    
    71,276
    
    
    
    
    
    
    
    Total operating expenses
    
    
    32,375
    
    
    
    83,110
    
    
    
    119,313
    
    
    
    39,859
    
    
    
    18,506Operating income (loss)
    
    
    (9,985
    )
    
    
    (44,984
    )
    
    
    (100,818
    )
    
    
    5,576
    
    
    
    27,083Non-operating income (expense), net
    
    
    (2,240
    )
    
    
    (911
    )
    
    
    (2,472
    )
    
    
    591
    
    
    
    533Income (loss) from continuing operations
before income taxes
    
    
    (12,225
    )
    
    
    (45,895
    )
    
    
    (103,290
    )
    
    
    6,167
    
    
    
    27,616Income tax benefit (provision)
    
    
    1,374
    
    
    
    (3,770
    )
    
    
    20,940
    
    
    
    (4,716
    )
    
    
    (11,154
    )Income (loss) from continuing operations
    
    
    (10,851
    )
    
    
    (49,665
    )
    
    
    (82,350
    )
    
    
    1,451
    
    
    
    16,462Loss from discontinued operations,
net of tax
    
    
    
    
    
    
    
    
    
    
    (597
    )
    
    
    (32,639
    )
    
    
    (1,900
    )Loss on sale of discontinued operations,
net of tax
    
    
    
    
    
    
    
    
    
    
    (1,202
    )
    
    
    
    
    
    
    Net income (loss)
    
    $
    (10,851
    )
    
    $
    (49,665
    )
    
    $
    (84,149
    )
    
    $
    (31,188
    )
    
    $
    14,562Basic earnings (loss) per share from:Continuing operations
    
    $
    (0.43
    )
    
    $
    (2.01
    )
    
    $
    (3.45
    )
    
    $
    0.06
    
    
    $
    0.72Discontinued operations
    
    
    
    
    
    
    
    
    
    
    (0.08
    )
    
    
    (1.40
    )
    
    
    (0.08
    )Total basic earnings (loss) per share
    
    $
    (0.43
    )
    
    $
    (2.01
    )
    
    $
    (3.53
    )
    
    $
    (1.34
    )
    
    $
    0.64Diluted earnings (loss) per share from:Continuing operations
    
    $
    (0.43
    )
    
    $
    (2.01
    )
    
    $
    (3.45
    )
    
    $
    0.06
    
    
    $
    0.70Discontinued operations
    
    
    
    
    
    
    
    
    
    
    (0.08
    )
    
    
    (1.40
    )
    
    
    (0.08
    )Total diluted earnings (loss) per share
    
    $
    (0.43
    )
    
    $
    (2.01
    )
    
    $
    (3.53
    )
    
    $
    (1.34
    )
    
    $
    0.62
  14




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##### 



February 28,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006(In thousands)BALANCE SHEET DATACurrent assets
    
    $
    37,490
    
    
    $
    44,175
    
    
    $
    66,767
    
    
    $
    113,524
    
    
    $
    99,236Current liabilities
    
    $
    33,095
    
    
    $
    45,458
    
    
    $
    40,059
    
    
    $
    38,637
    
    
    $
    21,873Working capital
    
    $
    4,395
    
    
    $
    (1,283
    )
    
    $
    26,708
    
    
    $
    74,887
    
    
    $
    77,363Current ratio
    
    
    1.1
    
    
    
    1.0
    
    
    
    1.7
    
    
    
    2.9
    
    
    
    4.5Total assets
    
    $
    56,953
    
    
    $
    69,647
    
    
    $
    143,041
    
    
    $
    229,703
    
    
    $
    204,346Long-term debt
    
    $
    4,170
    
    
    $
    
    
    
    $
    27,187
    
    
    $
    31,314
    
    
    $
    5,511Stockholders equity
    
    $
    19,199
    
    
    $
    23,199
    
    
    $
    73,420
    
    
    $
    151,251
    
    
    $
    176,109
  
    
    In fiscal 2009, the Company recorded a Satellite segment impairment charge of $2.3
million, a Wireless DataCom segment impairment charge of $41.3 million and an investment
impairment charge of $1.1 million.
 
    
    In fiscal 2009, the Company received $9 million in a legal settlement with Rogers
Corporation, a supplier of laminate materials that are part of the Companys DBS products.
This was recorded as a reduction of Satellite cost of revenues.
 
    
    In fiscal 2008, the Company recorded a $17.9 million charge for estimated expenses to
resolve a product performance issue involving a key DBS customer.
 
    
    In fiscal 2008, the Company recorded a Satellite goodwill impairment charge of $44.4
million and a Wireless DataCom goodwill impairment charge of $26.9 million.
 
    
    In fiscal 2007, the Company acquired Dataradio Inc. and the TechnoCom MRM product line.
In fiscal 2008, the Company acquired the Aercept vehicle tracking business and the
Smartlink business.
 
    
    In fiscal 2007, the Company recorded charges of $6,850,000 for the write-off of
in-process research and development costs in connection with the Dataradio acquisition and
$29,848,000 for the impairment of goodwill and other intangible assets of the discontinued
Solutions business. The $29.9 million impairment charge of fiscal 2007 is included in loss
from discontinued operations for that year.
 
    
    At the beginning of fiscal 2007, the Company adopted an accounting pronouncement related
to FASB ASC Topic 718, Compensation-Stock Compensation, as further described in Note 1 of
the accompanying consolidated financial statements under the caption Accounting for Stock
Options.
 ITEM 7.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
 Forward Looking Statements
   15




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Basis of Presentation
  Overview
   WIRELESS DATACOM
  SATELLITE
    16




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##### 



DISCONTINUED OPERATIONS
    Critical Accounting Policies
  Allowance for Doubtful Accounts
   17




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##### 



Inventories
  Product Warranties
   Deferred Income Tax and Uncertain Tax Positions
     Impairment Assessments of Purchased Intangible Assets and Other Long-Lived Assets
   18




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##### 



Stock-Based Compensation Expense
  Revenue Recognition
     19




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##### 



Results of Operations, Fiscal Years 2008 Through 2010
  Year Ended February 28,2010
    
    
    2009
    
    
    2008Revenues
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of revenues
    
    
    80.0
    
    
    
    61.3
    
    
    
    86.9Gross profit
    
    
    20.0
    
    
    
    38.7
    
    
    
    13.1Operating expenses:Research and development
    
    
    9.8
    
    
    
    13.1
    
    
    
    11.1Selling
    
    
    8.5
    
    
    
    9.1
    
    
    
    7.5General and administrative
    
    
    9.4
    
    
    
    12.2
    
    
    
    10.6Intangible asset amortization
    
    
    1.2
    
    
    
    4.5
    
    
    
    4.6Write-off of acquired in-process research and development
    
    
    
    
    
    
    
    
    
    
    0.2Impairment loss
    
    
    
    
    
    
    45.5
    
    
    
    50.6Operating loss
    
    
    (8.9
    )
    
    
    (45.7
    )
    
    
    (71.5
    )Other expense, net
    
    
    (2.0
    )
    
    
    (0.9
    )
    
    
    (1.8
    )Loss from continuing operations before income taxes
    
    
    (10.9
    )
    
    
    (46.6
    )
    
    
    (73.3
    )Income tax benefit (provision)
    
    
    1.2
    
    
    
    (3.9
    )
    
    
    14.9Loss from continuing operations
    
    
    (9.7
    )
    
    
    (50.5
    )
    
    
    (58.4
    )Loss from discontinued operations, net of tax
    
    
    
    
    
    
    
    
    
    
    (0.4
    )Loss on sale of discontinued operations, net of tax
    
    
    
    
    
    
    
    
    
    
    (0.9
    )Net loss
    
    
    (9.7
    %)
    
    
    (50.5
    %)
    
    
    (59.7
    %)
  REVENUE BY SEGMENT
 Year ended February 28,2010
    
    
    2009
    
    
    2008% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of$000s
    
    
    Total
    
    
    $000s
    
    
    Total
    
    
    $000s
    
    
    TotalSegmentSatellite
    
    $
    54,715
    
    
    
    48.8
    %
    
    $
    26,327
    
    
    
    26.8
    %
    
    $
    50,490
    
    
    
    35.8
    %Wireless DataCom
    
    
    57,398
    
    
    
    51.2
    %
    
    
    72,043
    
    
    
    73.2
    %
    
    
    90,417
    
    
    
    64.2
    %Total
    
    $
    112,113
    
    
    
    100.0
    %
    
    $
    98,370
    
    
    
    100.0
    %
    
    $
    140,907
    
    
    
    100.0
    %
 GROSS PROFIT (LOSS) BY SEGMENT
 Year ended February 28,2010
    
    
    2009
    
    
    2008% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of$000s
    
    
    Total
    
    
    $000s
    
    
    Total
    
    
    $000s
    
    
    TotalSegmentSatellite
    
    $
    4,258
    
    
    
    19.0
    %
    
    $
    10,254
    
    
    
    26.9
    %
    
    $
    (14,808
    )
    
    
    (80.1
    %)Wireless DataCom
    
    
    18,132
    
    
    
    81.0
    %
    
    
    27,872
    
    
    
    73.1
    %
    
    
    33,303
    
    
    
    180.1
    %Total
    
    $
    22,390
    
    
    
    100.0
    %
    
    $
    38,126
    
    
    
    100.0
    %
    
    $
    18,495
    
    
    
    100.0
    %
  20




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##### 



OPERATING INCOME (LOSS) BY SEGMENT
 Year ended February 28,2010
    
    
    2009
    
    
    2008% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofTotal
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total$000s
    
    
    Revenue
    
    
    $000s
    
    
    Revenue
    
    
    $000s
    
    
    RevenueSegmentSatellite
    
    $
    (111
    )
    
    
    (0.1
    %)
    
    $
    3,616
    
    
    
    3.7
    %
    
    $
    (63,924
    )
    
    
    (45.4
    %)Wireless DataCom
    
    $
    (5,867
    )
    
    
    (5.2
    %)
    
    $
    (42,206
    )
    
    
    (42.9
    %)
    
    $
    (30,473
    )
    
    
    (21.6
    %)Corporate expenses
    
    
    (4,007
    )
    
    
    (3.6
    %)
    
    
    (6,394
    )
    
    
    (6.5
    %)
    
    
    (6,421
    )
    
    
    (4.6
    %)Total
    
    $
    (9,985
    )
    
    
    (8.9
    %)
    
    $
    (44,984
    )
    
    
    (45.7
    %)
    
    $
    (100,818
    )
    
    
    (71.6
    %)
      Fiscal Year 2010 compared to Fiscal Year 2009
       21




---



##### 



Fiscal Year 2009 compared to Fiscal Year 2008
    22




---



##### 



23




---



##### 



Liquidity and Capital Resources
         24




---



##### 



Off-Balance Sheet Arrangements
  Contractual Obligations
  Payments Due by PeriodMoreLess than
    
    
    
    
    
    
    
    
    
    
    than 5Contractual Obligations
    
    1 year
    
    
    1-3 years
    
    
    3-5 years
    
    
    years
    
    
    TotalBank debt
    
    $
    5,901
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    5,901Subordinated notes
    
    
    
    
    
    
    4,170
    
    
    
    
    
    
    
    
    
    
    
    4,170Operating leases
    
    
    1,972
    
    
    
    959
    
    
    
    5
    
    
    
    
    
    
    
    2,936Purchase obligations
    
    
    12,134
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,134Total contractual obligations
    
    $
    20,007
    
    
    $
    5,129
    
    
    $
    5
    
    
    $
    
    
    
    $
    25,141
  RECENT ACCOUNTING PRONOUNCEMENTS
  ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Foreign Currency Risk
  Interest Rate Risk
   25




---



##### 



ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
       
  26




---



##### 



Report of Independent Registered Public Accounting Firm
 
     
  27




---



##### 



CALAMP CORP.
 CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PAR VALUE)
 February 28,2010
    
    
    2009AssetsCurrent assets:Cash and cash equivalents
    
    $
    2,986
    
    
    $
    6,913Accounts receivable, less allowance for doubtful accounts of
$413 and $552 at February 28, 2010 and 2009, respectively
    
    
    16,520
    
    
    
    13,682Inventories
    
    
    10,608
    
    
    
    15,139Deferred income tax assets
    
    
    2,656
    
    
    
    3,479Prepaid expenses and other current assets
    
    
    4,720
    
    
    
    4,962Total current assets
    
    
    37,490
    
    
    
    44,175Property, equipment and improvements, net of
accumulated depreciation and amortization
    
    
    2,055
    
    
    
    2,139Deferred income tax assets, less current portion
    
    
    10,017
    
    
    
    13,111Intangible assets, net
    
    
    5,144
    
    
    
    6,473Other assets
    
    
    2,247
    
    
    
    3,749$
    56,953
    
    
    $
    69,647Liabilities and Stockholders EquityCurrent liabilities:Current portion of debt
    
    $
    5,901
    
    
    $
    21,078Accounts payable
    
    
    16,186
    
    
    
    5,422Accrued payroll and employee benefits
    
    
    2,742
    
    
    
    3,380Deferred revenue
    
    
    4,740
    
    
    
    3,609Other current liabilities
    
    
    3,526
    
    
    
    11,969Total current liabilities
    
    
    33,095
    
    
    
    45,458Long-term debt
    
    
    4,170
    
    
    
    Other non-current liabilities
    
    
    489
    
    
    
    990Commitments and contingenciesStockholders equity:Preferred stock, $.01 par value; 3,000 shares authorized;
no shares issued or outstanding
    
    
    
    
    
    
    Common Stock, $.01 par value; 40,000 shares authorized;
27,662 and 25,217 shares issued and outstanding
at February 28, 2010 and 2009, respectively
    
    
    277
    
    
    
    252Additional paid-in capital
    
    
    151,453
    
    
    
    144,881Accumulated deficit
    
    
    (131,665
    )
    
    
    (120,814
    )Accumulated other comprehensive loss
    
    
    (866
    )
    
    
    (1,120
    )Total stockholders equity
    
    
    19,199
    
    
    
    23,199$
    56,953
    
    
    $
    69,647
   28




---



##### 



CALAMP CORP.
 CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
 Year Ended February 28,2010
    
    
    2009
    
    
    2008Revenues
    
    $
    112,113
    
    
    $
    98,370
    
    
    $
    140,907Cost of revenues
    
    
    89,723
    
    
    
    60,244
    
    
    
    122,412Gross profit
    
    
    22,390
    
    
    
    38,126
    
    
    
    18,495Operating expenses:Research and development
    
    
    10,943
    
    
    
    12,899
    
    
    
    15,710Selling
    
    
    9,542
    
    
    
    8,959
    
    
    
    10,633General and administrative
    
    
    10,523
    
    
    
    12,087
    
    
    
    14,966Intangible asset amortization
    
    
    1,367
    
    
    
    4,429
    
    
    
    6,418Write-off of acquired in-process research and development
    
    
    
    
    
    
    
    
    
    
    310Impairment loss
    
    
    
    
    
    
    44,736
    
    
    
    71,276Total operating expenses
    
    
    32,375
    
    
    
    83,110
    
    
    
    119,313Operating loss
    
    
    (9,985
    )
    
    
    (44,984
    )
    
    
    (100,818
    )Non-operating income (expense):Interest expense, net
    
    
    (940
    )
    
    
    (1,091
    )
    
    
    (1,903
    )Other income (expense), net
    
    
    (1,300
    )
    
    
    180
    
    
    
    (569
    )Total non-operating expense
    
    
    (2,240
    )
    
    
    (911
    )
    
    
    (2,472
    )Loss from continuing operations before income taxes
    
    
    (12,225
    )
    
    
    (45,895
    )
    
    
    (103,290
    )Income tax benefit (provision)
    
    
    1,374
    
    
    
    (3,770
    )
    
    
    20,940Loss from continuing operations
    
    
    (10,851
    )
    
    
    (49,665
    )
    
    
    (82,350
    )Loss from discontinued operations, net of tax
    
    
    
    
    
    
    
    
    
    
    (597
    )Loss on sale of discontinued operations, net of tax
    
    
    
    
    
    
    
    
    
    
    (1,202
    )Net loss
    
    $
    (10,851
    )
    
    $
    (49,665
    )
    
    $
    (84,149
    )Basic and diluted loss per share from:Continuing operations
    
    $
    (0.43
    )
    
    $
    (2.01
    )
    
    $
    (3.45
    )Discontinued operations
    
    
    
    
    
    
    
    
    
    
    (0.08
    )Total basic and diluted loss per share
    
    $
    (0.43
    )
    
    $
    (2.01
    )
    
    $
    (3.53
    )Shares used in computing basic and diluted loss per share:Basic
    
    
    25,309
    
    
    
    24,765
    
    
    
    23,881Diluted
    
    
    25,309
    
    
    
    24,765
    
    
    
    23,881
   29




---



##### 



CALAMP CORP.
 CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
AND COMPREHENSIVE LOSS
(IN THOUSANDS)
 Retained
    
    
    AccumulatedAdditional
    
    
    Earnings
    
    
    Other
    
    
    TotalCommon Stock
    
    
    Paid-in
    
    
    (Accumulated
    
    
    Comprehen-
    
    
    StockholdersShares
    
    
    Amount
    
    
    Capital
    
    
    Deficit)
    
    
    sive Loss
    
    
    EquityBalances at February 28, 2007
    
    
    23,595
    
    
    $
    236
    
    
    $
    139,175
    
    
    $
    13,000
    
    
    $
    (1,160
    )
    
    $
    151,251Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (84,149
    )
    
    
    
    
    
    
    (84,149
    )Change in unrealized gain on
available-for-sale investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (45
    )
    
    
    (45
    )Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,206
    
    
    
    1,206Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (82,988
    )Issuance of restricted stock,
net of forfeitures
    
    
    380
    
    
    
    4
    
    
    
    (4
    )
    
    
    
    
    
    
    
    
    
    
    Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    2,238
    
    
    
    
    
    
    
    
    
    
    
    2,238Exercise of stock options and warrants
    
    
    66
    
    
    
    
    
    
    
    212
    
    
    
    
    
    
    
    
    
    
    
    212Issuance of stock and warrants
    
    
    1,000
    
    
    
    10
    
    
    
    2,802
    
    
    
    
    
    
    
    
    
    
    
    2,812Other
    
    
    
    
    
    
    
    
    
    
    (105
    )
    
    
    
    
    
    
    
    
    
    
    (105
    )Balances at February 28, 2008
    
    
    25,041
    
    
    
    250
    
    
    
    144,318
    
    
    
    (71,149
    )
    
    
    1
    
    
    
    73,420Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (49,665
    )
    
    
    
    
    
    
    (49,665
    )Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,121
    )
    
    
    (1,121
    )Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (50,786
    )Issuance of restricted stock,
net of forfeitures
    
    
    166
    
    
    
    2
    
    
    
    (127
    )
    
    
    
    
    
    
    
    
    
    
    (125
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    1,268
    
    
    
    
    
    
    
    
    
    
    
    1,268Exercise of stock options and warrants
    
    
    10
    
    
    
    
    
    
    
    (15
    )
    
    
    
    
    
    
    
    
    
    
    (15
    )Other
    
    
    
    
    
    
    
    
    
    
    (563
    )
    
    
    
    
    
    
    
    
    
    
    (563
    )Balances at February 28, 2009
    
    
    25,217
    
    
    
    252
    
    
    
    144,881
    
    
    
    (120,814
    )
    
    
    (1,120
    )
    
    
    23,199Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,851
    )
    
    
    
    
    
    
    (10,851
    )Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    254
    
    
    
    254Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,597
    )Issuance of restricted stock,
net of forfeitures
    
    
    512
    
    
    
    6
    
    
    
    (129
    )
    
    
    
    
    
    
    
    
    
    
    (123
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    1,981
    
    
    
    
    
    
    
    
    
    
    
    1,981Exercise of stock options
    
    
    1
    
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    1Sale of stock
    
    
    1,932
    
    
    
    19
    
    
    
    3,948
    
    
    
    
    
    
    
    
    
    
    
    3,967Issuance of warrants
    
    
    
    
    
    
    
    
    
    
    870
    
    
    
    
    
    
    
    
    
    
    
    870Other
    
    
    
    
    
    
    
    
    
    
    (99
    )
    
    
    
    
    
    
    
    
    
    
    (99
    )Balances at February 28, 2010
    
    
    27,662
    
    
    $
    277
    
    
    $
    151,453
    
    
    $
    (131,665
    )
    
    $
    (866
    )
    
    $
    19,199
   30




---



##### 



CALAMP CORP.
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
 Year Ended February 28,2010
    
    
    2009
    
    
    2008CASH FLOWS FROM OPERATING ACTIVITIES:Net loss
    
    $
    (10,851
    )
    
    $
    (49,665
    )
    
    $
    (84,149
    )Adjustments to reconcile net loss
to net cash provided (used) by operating activities:Depreciation and amortization
    
    
    2,522
    
    
    
    6,549
    
    
    
    9,681Stock-based compensation expense
    
    
    1,981
    
    
    
    1,268
    
    
    
    2,238Write-off of in-process research and development
    
    
    
    
    
    
    
    
    
    
    310Impairment loss
    
    
    
    
    
    
    44,736
    
    
    
    71,276Loss (gain) on sale of investment
    
    
    1,008
    
    
    
    
    
    
    
    (331
    )Deferred tax assets, net
    
    
    39
    
    
    
    3,373
    
    
    
    (20,784
    )Loss on sale of discontinued operations, net of tax
    
    
    
    
    
    
    
    
    
    
    1,202Other
    
    
    104
    
    
    
    
    
    
    
    (6
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    (2,780
    )
    
    
    6,288
    
    
    
    18,700Inventories
    
    
    4,626
    
    
    
    9,442
    
    
    
    1,116Prepaid expenses and other assets
    
    
    42
    
    
    
    2,679
    
    
    
    2,629Accounts payable
    
    
    10,764
    
    
    
    (5,453
    )
    
    
    (16,807
    )Accrued liabilities
    
    
    (6,114
    )
    
    
    (5,061
    )
    
    
    13,795Deferred revenue
    
    
    1,131
    
    
    
    (396
    )
    
    
    (346
    )NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES
    
    
    2,472
    
    
    
    13,760
    
    
    
    (1,476
    )CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    (1,066
    )
    
    
    (831
    )
    
    
    (1,359
    )Proceeds from sale of property and equipment
    
    
    2
    
    
    
    
    
    
    
    7Proceeds from sale of investment
    
    
    992
    
    
    
    
    
    
    
    1,045Proceeds from sale of discontinued operations
    
    
    325
    
    
    
    465
    
    
    
    4,420Acquisition of Aercept
    
    
    
    
    
    
    
    
    
    
    (19,318
    )Acquisition of Smartlink
    
    
    
    
    
    
    296
    
    
    
    (7,845
    )Acquisition of TechnoCom product line
    
    
    
    
    
    
    (1,183
    )
    
    
    (985
    )Other
    
    
    (38
    )
    
    
    (188
    )
    
    
    NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES
    
    
    215
    
    
    
    (1,441
    )
    
    
    (24,035
    )CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from borrowings on lines of credit
    
    
    7,551
    
    
    
    
    
    
    
    Proceeds from issuance of subordinated debt and warrants
    
    
    5,000
    
    
    
    
    
    
    
    Net proceeds from sale of common stock
    
    
    3,967
    
    
    
    
    
    
    
    Debt repayments
    
    
    (22,728
    )
    
    
    (11,452
    )
    
    
    (6,728
    )Payment of debt issue costs
    
    
    (544
    )
    
    
    
    
    
    
    Proceeds from exercise of stock options
    
    
    1
    
    
    
    
    
    
    
    213NET CASH USED IN FINANCING ACTIVITIES
    
    
    (6,753
    )
    
    
    (11,452
    )
    
    
    (6,515
    )EFFECT OF EXCHANGE RATE CHANGES ON CASH
    
    
    139
    
    
    
    (542
    )
    
    
    1,077Net change in cash and cash equivalents
    
    
    (3,927
    )
    
    
    325
    
    
    
    (30,949
    )Cash and cash equivalents at beginning of year
    
    
    6,913
    
    
    
    6,588
    
    
    
    37,537Cash and cash equivalents at end of year
    
    $
    2,986
    
    
    $
    6,913
    
    
    $
    6,588
   31




---



##### 



CALAMP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 NOTE 1  DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Description of Business
  Principles of Consolidation
  Use of Estimates
  Fiscal Year
  Revenue Recognition
   Cash and Cash Equivalents
   32




---



##### 



Concentrations of Risk
   Year ended February 28,Customer
    
    2010
    
    
    2009
    
    
    2008A
    
    
    48.6
    %
    
    
    15.7
    %
    
    
    10.9
    %B
    
    
    
    
    
    
    10.3
    %
    
    
    23.9
    %C
    
    
    3.9
    %
    
    
    9.0
    %
    
    
    14.2
    %
   February 28,Customer
    
    2010
    
    
    2009A
    
    
    47.9
    %
    
    
    26.3
    %
   Allowance for Doubtful Accounts
  Inventories
  Property, equipment and improvements
    33




---



##### 



Operating Leases
   Other Intangible Assets
  Accounting for Long-Lived Assets Other Than Goodwill
  Disclosures About Fair Value of Financial Instruments
    Warranty
  Deferred Income Taxes
    34




---



##### 



Foreign Currency Translation and Accumulated Other Comprehensive Income (Loss) Account
    Earnings Per Share
  Accounting for Stock Options
  Recent Authoritative Pronouncements
   35




---



##### 



Reclassifications
  NOTE 2 DISCONTINUED OPERATIONS
    Year EndedFebruary 28,2008Revenues
    
    $
    1,691Operating loss
    
    $
    (996
    )Loss from discontinued operations, net of tax
    
    $
    (597
    )Loss on sale of discontinued operations, net of tax
    
    $
    (1,202
    )
   NOTE 3  INVENTORIES
  February 28,2010
    
    
    2009Raw materials
    
    $
    9,483
    
    
    $
    12,036Work in process
    
    
    209
    
    
    
    164Finished goods
    
    
    916
    
    
    
    2,939$
    10,608
    
    
    $
    15,139
  36




---



##### 



NOTE 4  PROPERTY, EQUIPMENT AND IMPROVEMENTS
  February 28,2010
    
    
    2009Leasehold improvements
    
    $
    1,498
    
    
    $
    1,369Plant equipment and tooling
    
    
    12,380
    
    
    
    12,091Office equipment, computers and furniture
    
    
    2,083
    
    
    
    1,77515,961
    
    
    
    15,235Less accumulated depreciation and amortization
    
    
    (13,906
    )
    
    
    (13,096
    )$
    2,055
    
    
    $
    2,139
 NOTE 5  GOODWILL AND OTHER INTANGIBLE ASSETS
  WirelessSatellite
    
    
    DataCom
    
    
    TotalBalance as of February 28, 2008
    
    $
    2,255
    
    
    $
    26,265
    
    
    $
    28,520Impairment writedown
    
    
    (2,255
    )
    
    
    (26,272
    )
    
    
    (28,527
    )Other changes
    
    
    
    
    
    
    7
    
    
    
    7Balance as of February 28, 2009
    
    $
    
    
    
    $
    
    
    
    $
    
     37




---



##### 



Year ended February 28, 2010
    
    
    Year ended February 28, 2009Gross
    
    
    Accum-
    
    
    
    
    
    
    Gross
    
    
    Accum-Amortization
    
    
    Carrying
    
    
    ulated
    
    
    
    
    
    
    Carrying
    
    
    ulatedPeriod
    
    
    Amount
    
    
    Amortization
    
    
    Net
    
    
    Amount
    
    
    Amortization
    
    
    NetDeveloped/core
technology
    
    5-7 years
    
    $
    3,101
    
    
    $
    1,054
    
    
    $
    2,047
    
    
    $
    3,101
    
    
    $
    155
    
    
    $
    2,946Customer lists
    
    5-7 years
    
    
    1,339
    
    
    
    475
    
    
    
    864
    
    
    
    1,339
    
    
    
    70
    
    
    
    1,269Covenants not to compete
    
    1 year
    
    
    138
    
    
    
    66
    
    
    
    72
    
    
    
    138
    
    
    
    10
    
    
    
    128Patents
    
    4-5 years
    
    
    39
    
    
    
    8
    
    
    
    31
    
    
    
    
    
    
    
    
    
    
    
    Tradename
    
    Indefinite
    
    
    2,130
    
    
    
    
    
    
    
    2,130
    
    
    
    2,130
    
    
    
    
    
    
    
    2,130$
    6,747
    
    
    $
    1,603
    
    
    $
    5,144
    
    
    $
    6,708
    
    
    $
    235
    
    
    $
    6,473
   2011
    
    $
    1,1332012
    
    $
    9902013
    
    $
    7322014
    
    $
    159
 NOTE 6  FINANCING ARRANGEMENTS AND CONTRACTUAL CASH OBLIGATIONS
 Debt
  February 28,2010
    
    
    2009Bank working capital line of credit
    
    $
    5,901
    
    
    $
    Bank term loan
    
    
    
    
    
    
    17,550Subordinated note payable to a DBS customer
    
    
    
    
    
    
    3,528$
    5,901
    
    
    $
    21,078
  Subordinated promissory notes due December 22, 2012
    
    $
    5,000Less discount
    
    
    (830
    )$
    4,170
    38




---



##### 



Other Non-Current Liabilities
  February 28,2010
    
    
    2009Deferred rent
    
    $
    88
    
    
    $
    650Deferred revenue
    
    
    401
    
    
    
    340$
    489
    
    
    $
    990
  39




---



##### 



Contractual Cash Obligations
  Future Cash Payments Due by Fiscal YearThere-Contractual Obligations
    
    2011
    
    
    2012
    
    
    2013
    
    
    2014
    
    
    2015
    
    
    after
    
    
    TotalBank debt
    
    $
    5,901
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    5,901Subordinated notes
    
    
    
    
    
    
    
    
    
    
    4,170
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,170Operating leases
    
    
    1,972
    
    
    
    895
    
    
    
    64
    
    
    
    5
    
    
    
    
    
    
    
    
    
    
    
    2,936Purchase obligations
    
    
    12,134
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,134Total contractual obligations
    
    $
    20,007
    
    
    $
    895
    
    
    $
    4,234
    
    
    $
    5
    
    
    $
    
    
    
    $
    
    
    
    $
    25,141
   NOTE 7  INCOME TAXES
  Year Ended February 28,2010
    
    
    2009
    
    
    2008Domestic
    
    $
    (9,587
    )
    
    $
    (43,940
    )
    
    $
    (100,427
    )Foreign
    
    
    (2,638
    )
    
    
    (1,955
    )
    
    
    (2,863
    )$
    (12,225
    )
    
    $
    (45,895
    )
    
    $
    (103,290
    )
  Year Ended February 28,2010
    
    
    2009
    
    
    2008Current:Federal
    
    $
    
    
    
    $
    
    
    
    $
    State
    
    
    
    
    
    
    
    
    
    
    Foreign
    
    
    
    
    
    
    (279
    )
    
    
    (15
    )Total current
    
    
    
    
    
    
    (279
    )
    
    
    (15
    )Deferred:Federal
    
    
    1,098
    
    
    
    (2,801
    )
    
    
    15,972State
    
    
    276
    
    
    
    (690
    )
    
    
    4,983Total deferred
    
    
    1,374
    
    
    
    (3,491
    )
    
    
    20,955$
    1,374
    
    
    $
    (3,770
    )
    
    $
    20,940
  40




---



##### 



Year Ended February 28,2010
    
    
    2009
    
    
    2008Continuing operations
    
    $
    1,374
    
    
    $
    (3,770
    )
    
    $
    20,940Discontinued operations
    
    
    
    
    
    
    
    
    
    
    (2,431
    )$
    1,374
    
    
    $
    (3,770
    )
    
    $
    18,509
  Year Ended February 28,2010
    
    
    2009
    
    
    2008Income tax at U.S. statutory federal rate of 35%
    
    $
    4,278
    
    
    $
    16,063
    
    
    $
    36,152State income taxes, net of federal income tax effect
    
    
    760
    
    
    
    1,793
    
    
    
    2,708Foreign taxes
    
    
    84
    
    
    
    64
    
    
    
    (73
    )Nondeductible goodwill
    
    
    
    
    
    
    (4,627
    )
    
    
    (17,289
    )Valuation allowance
    
    
    (24,074
    )
    
    
    (17,424
    )
    
    
    (937
    )Stock basis tax deduction in dissolved subsidiaries
    
    
    18,089
    
    
    
    
    
    
    
    Other, net
    
    
    2,237
    
    
    
    361
    
    
    
    379$
    1,374
    
    
    $
    (3,770
    )
    
    $
    20,940
  February 28,2010
    
    
    2009Depreciation, amortization and impairments
    
    $
    13,508
    
    
    $
    14,672Net operating loss carryforwards
    
    
    30,056
    
    
    
    9,477Research and development credits
    
    
    4,277
    
    
    
    3,572Other tax credits
    
    
    1,875
    
    
    
    1,875Warranty reserve
    
    
    495
    
    
    
    1,323Stock-based compensation
    
    
    1,621
    
    
    
    1,166Compensation and vacation accruals
    
    
    617
    
    
    
    729Inventory reserve
    
    
    951
    
    
    
    815Allowance for doubtful accounts
    
    
    163
    
    
    
    219Other, net
    
    
    407
    
    
    
    97253,970
    
    
    
    34,820Valuation allowance
    
    
    (41,297
    )
    
    
    (18,230
    )Net deferred tax asset
    
    
    12,673
    
    
    
    16,590Less current portion
    
    
    2,656
    
    
    
    3,479Non-current portion
    
    $
    10,017
    
    
    $
    13,111
     41




---



##### 



Balance at February 28, 2008
    
    $
    6,284Increase in fiscal 2009
    
    
    165Balance at February 28, 2009
    
    
    6,449Decrease in fiscal 2010
    
    
    (5,184
    )Balance at February 28, 2010
    
    $
    1,265
     NOTE 8  STOCKHOLDERS EQUITY
 Equity Awards
    42




---



##### 



WeightedNumber of
    
    
    AverageOptions
    
    
    Option PriceOutstanding at February 28, 2007
    
    
    2,461
    
    
    $
    10.33Granted
    
    
    355
    
    
    
    4.46Exercised
    
    
    (66
    )
    
    
    3.24Forfeited or expired
    
    
    (368
    )
    
    
    11.03Outstanding at February 28, 2008
    
    
    2,382
    
    
    
    9.54Granted
    
    
    578
    
    
    
    2.42Exercised
    
    
    (50
    )
    
    
    1.75Forfeited or expired
    
    
    (1,041
    )
    
    
    8.36Outstanding at February 28, 2009
    
    
    1,869
    
    
    
    8.20Granted
    
    
    320
    
    
    
    1.48Exercised
    
    
    (1
    )
    
    
    1.32Forfeited or expired
    
    
    (165
    )
    
    
    24.39Outstanding at February 28, 2010
    
    
    2,023
    
    
    $
    5.82Exercisable at February 28, 2010
    
    
    1,144
    
    
    $
    8.06
   WeightedNumber of
    
    
    Average GrantShares
    
    
    Date Fairand RSUs
    
    
    ValueOutstanding at February 28, 2007
    
    
    20
    
    
    $
    6.51Granted
    
    
    542
    
    
    
    3.71Vested
    
    
    (80
    )
    
    
    4.84Forfeited
    
    
    (8
    )
    
    
    4.28Outstanding at February 28, 2008
    
    
    474
    
    
    
    3.63Granted
    
    
    633
    
    
    
    2.06Vested
    
    
    (149
    )
    
    
    3.76Forfeited
    
    
    (51
    )
    
    
    3.87Outstanding at February 28, 2009
    
    
    907
    
    
    
    2.50Granted
    
    
    1,147
    
    
    
    1.81Vested
    
    
    (231
    )
    
    
    2.49Forfeited
    
    
    (39
    )
    
    
    2.26Outstanding at February 28, 2010
    
    
    1,784
    
    
    $
    2.06
    43




---



##### 



Year Ended February 28,Black-Scholes Valuation Assumptions
    
    2010
    
    2009
    
    2008Expected life (years) (1)
    
    6
    
    6
    
    6Expected volatility (2)
    
    74%-79%
    
    63%-64%
    
    61%-64%Risk-free interest rates (3)
    
    2.0%-3.0%
    
    2.7%-3.5%
    
    4.5%-4.6%Expected dividend yield
    
    0%
    
    0%
    
    0%
 (1)
    
    The expected life of stock options is estimated based on historical experience.(2)
    
    The expected volatility is estimated based on historical volatility of the Companys stock
price.(3)
    
    Based on the U.S. Treasury constant maturity interest rate whose term is consistent with the
expected life of the stock options.    Year Ended February 28,2010
    
    
    2009
    
    
    2008Cost of revenues
    
    $
    164
    
    
    $
    75
    
    
    $
    64Research and development
    
    
    298
    
    
    
    257
    
    
    
    205Selling
    
    
    133
    
    
    
    102
    
    
    
    294General and administrative
    
    
    1,386
    
    
    
    834
    
    
    
    1,590$
    1,981
    
    
    $
    1,268
    
    
    $
    2,153
   Stock Warrants
    44




---



##### 



Preferred Stock Purchase Rights
  NOTE 9  EARNINGS PER SHARE
  NOTE 10  OTHER FINANCIAL INFORMATION
 Other Current Liabilities
  February 28,2010
    
    
    2009Income taxes payable
    
    $
    9
    
    
    $
    5,218Accrued warranty costs
    
    
    1,231
    
    
    
    3,286Other
    
    
    2,286
    
    
    
    3,465$
    3,526
    
    
    $
    11,969
 Supplemental Cash Flow Information
  Year Ended February 28,2010
    
    
    2009
    
    
    2008Interest paid
    
    $
    942
    
    
    $
    1,615
    
    
    $
    2,322Income taxes refunded
    
    $
    (6
    )
    
    $
    (792
    )
    
    $
    (1,645
    )
  45




---



##### 



Year Ended February 28,2010
    
    
    2009
    
    
    2008Non-cash consideration issued in partial satisfaction
of product performance claim by key customer:Common stock
    
    $
    
    
    
    $
    
    
    
    $
    2,560Warrants
    
    $
    
    
    
    $
    
    
    
    $
    252Subordinated note payable
    
    $
    
    
    
    $
    
    
    
    $
    5,000Non-cash consideration received from the sale of the
Solutions Divisions TelAlert software business:Note receivable, net of payments received
    
    $
    
    
    
    $
    
    
    
    $
    1,970Fair value of preferred stock
    
    $
    
    
    
    $
    
    
    
    $
    3,137Earn-out amount for TechnoCom acquistion, net of
payments
    
    $
    
    
    
    $
    
    
    
    $
    1,284
 Valuation and Qualifying Accounts
  ChargedBalance
    
    
    (credited)at
    
    
    to costs
    
    
    
    
    
    
    
    
    
    
    Balancebeginning
    
    
    and
    
    
    
    
    
    
    
    
    
    
    at end ofAllowance for doubtful accounts:
    
    of period
    
    
    expenses
    
    
    Deductions
    
    
    Other
    
    
    periodFiscal 2008
    
    $
    347
    
    
    $
    1,398
    
    
    $
    (1,111
    )
    
    $
    637
    (1)
    
    $
    1,271Fiscal 2009
    
    
    1,271
    
    
    
    (507
    )
    
    
    (212
    )
    
    
    
    
    
    
    552Fiscal 2010
    
    
    552
    
    
    
    486
    
    
    
    (625
    )
    
    
    
    
    
    
    413
 ChargedBalance
    
    
    (credited)at
    
    
    to costs
    
    
    
    
    
    
    
    
    
    
    Balancebeginning
    
    
    and
    
    
    
    
    
    
    
    
    
    
    at end ofWarranty reserve:
    
    of period
    
    
    expenses
    
    
    Deductions
    
    
    Other
    
    
    periodFiscal 2008
    
    $
    1,295
    
    
    $
    13,435
    
    
    $
    (1,049
    )
    
    $
    (8,812
    )(2)
    
    $
    4,869Fiscal 2009
    
    
    4,869
    
    
    
    353
    
    
    
    (1,936
    )
    
    
    
    
    
    
    3,286Fiscal 2010
    
    
    3,286
    
    
    
    305
    
    
    
    (2,360
    )
    
    
    
    
    
    
    1,231
 (1)
    
    These represent amounts of allowances and reserves pertaining to the Aercept assets that
were acquired from AirIQ in March 2007.(2)
    
    The warranty reserve was reduced by $8.8 million as the result of a settlement agreement
with a key DBS customer, as further described in Note 11.  46




---



##### 



NOTE 11  COMMITMENTS AND CONTINGENCIES
 Operating Lease Commitments
  DBS Product Field Performance Issues
    
    
    The Company issued to the customer one million shares of CalAmp common stock.
 
    
    The Company issued to the customer a fully vested warrant to purchase an additional
350,000 shares of common stock at $3.72 per share, exercisable for three years.
 
    
    The customer agreed to restrictions on 500,000 shares of the common stock issued in
connection with the settlement and the warrant shares that limit sales to 285,000 shares in
any one year period following the settlement date. The customer also agreed to vote all of
its CalAmp shares (including the warrant shares) either with the recommendation of the
Companys Board of Directors or in the same proportion as all other outstanding shares.
 
    
    The Company issued to the customer a $5 million non-interest bearing promissory note
that was payable at a rate of $5.00 per unit on the first one million DBS units purchased
by a key DBS customer after the date of the settlement agreement.
 
    
    The customer agreed to pay $1.3 million of $2.3 million in outstanding accounts
receivable due to the Company, with the remaining $1 million of receivables canceled by the
Company as additional consideration for the settlement.
 
    
    The parties agreed to release each other from claims related to all products shipped
before the date of the settlement agreement.
    47




---



##### 



Other Contingencies
  NOTE 12  LEGAL PROCEEDINGS
     NOTE 13  SEGMENT AND GEOGRAPHIC DATA
  Year ended February 28, 2010
    
    
    Year ended February 28, 2009Operating Segments
    
    
    
    
    
    
    
    
    
    
    Operating SegmentsWireless
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    WirelessSatellite
    
    
    DataCom
    
    
    Corporate
    
    
    Total
    
    
    Satellite
    
    
    DataCom
    
    
    Corporate
    
    
    TotalRevenues
    
    $
    54,715
    
    
    $
    57,398
    
    
    
    
    
    
    $
    112,113
    
    
    $
    26,327
    
    
    $
    72,043
    
    
    
    
    
    
    $
    98,370Gross profit
    
    $
    4,258
    
    
    $
    18,132
    
    
    
    
    
    
    $
    22,390
    
    
    $
    10,254
    
    
    $
    27,872
    
    
    
    
    
    
    $
    38,126Gross margin
    
    
    7.8
    %
    
    
    31.6
    %
    
    
    
    
    
    
    20.0
    %
    
    
    38.9
    %
    
    
    38.7
    %
    
    
    
    
    
    
    38.8
    %Operating income
(loss)
    
    $
    (111
    )
    
    $
    (5,867
    )
    
    $
    (4,007
    )
    
    $
    (9,985
    )
    
    $
    3,616
    
    
    $
    (42,206
    )
    
    $
    (6,394
    )
    
    $
    (44,984
    )
  48




---



##### 



Year ended February 28, 2008Operating SegmentsWirelessSatellite
    
    
    DataCom
    
    
    Corporate
    
    
    TotalRevenues
    
    $
    50,490
    
    
    $
    90,417
    
    
    
    
    
    
    $
    140,907Gross profit (loss)
    
    $
    (14,808
    )
    
    $
    33,303
    
    
    
    
    
    
    $
    18,495Gross margin
    
    
    (29.3
    %)
    
    
    36.8
    %
    
    
    
    
    
    
    13.1
    %Operating loss
    
    $
    (63,924
    )
    
    $
    (30,473
    )
    
    $
    (6,421
    )
    
    $
    (100,818
    )
     NOTE 14  QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
  Fiscal 2010First
    
    
    Second
    
    
    Third
    
    
    FourthQuarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    TotalRevenues
    
    $
    23,000
    
    
    $
    23,940
    
    
    $
    30,692
    
    
    $
    34,481
    
    
    $
    112,113Gross profit
    
    
    4,707
    
    
    
    4,804
    
    
    
    5,897
    
    
    
    6,982
    
    
    
    22,390Gross margin
    
    
    20.5
    %
    
    
    20.1
    %
    
    
    19.2
    %
    
    
    20.2
    %
    
    
    20.0
    %Net loss
    
    
    (3,957
    )
    
    
    (4,243
    )
    
    
    (1,319
    )
    
    
    (1,332
    )
    
    
    (10,851
    )Net loss per diluted share
    
    
    (0.16
    )
    
    
    (0.17
    )
    
    
    (0.05
    )
    
    
    (0.05
    )
    
    
    (0.43
    )
 Fiscal 2009First
    
    
    Second
    
    
    Third
    
    
    FourthQuarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    TotalRevenues
    
    $
    27,901
    
    
    $
    23,308
    
    
    $
    25,834
    
    
    $
    21,327
    
    
    $
    98,370Gross profit
    
    
    9,429
    
    
    
    7,468
    
    
    
    7,641
    
    
    
    13,588
    
    
    
    38,126Gross margin
    
    
    33.8
    %
    
    
    32.0
    %
    
    
    29.6
    %
    
    
    63.7
    %
    
    
    38.8
    %Net loss
    
    
    (497
    )
    
    
    (1,498
    )
    
    
    (1,838
    )
    
    
    (45,832
    )
    
    
    (49,665
    )Net loss per diluted share
    
    
    (0.02
    )
    
    
    (0.06
    )
    
    
    (0.07
    )
    
    
    (1.85
    )
    
    
    (2.01
    )
   49




---



##### 



ITEM 9.
    
    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  ITEM 9A(T). CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
  Managements Report on Internal Control over Financial Reporting
    Changes in Internal Control over Financial Reporting
  ITEM 9B. OTHER INFORMATION
 Compensatory Arrangements of Executive Officers
  
    
    Richard Gold
    
    Chief Executive Officer
    
    Michael Burdiek
    
    President and Chief Operating Officer
    
    Garo Sarkissian
    
    Vice President Corporate Development
    
    Richard Vitelle
    
    Vice President Finance, Chief Financial
Officer and Corporate Secretary
  50




---



##### 



PART III
 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
   
    
    Information regarding directors of the Company who are standing for reelection.
 
    
    Information regarding the Companys Audit Committee and designated audit committee
financial experts.
 
    
    Information on the Companys Code of Business Conduct and Ethics for directors,
officers and employees.
 ITEM 11. EXECUTIVE COMPENSATION
  ITEM 12.
    
    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS  ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
  ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
   51




---



##### 



PART IV
 ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
  1.
    
    The following consolidated financial statements of CalAmp Corp. and subsidiaries
are filed as part of this report under Item 8  Financial Statements and Supplementary
Data:
 Form 10-KPage No.Reports of Independent Registered Public Accounting Firms
    
    
    26Consolidated Balance Sheets
    
    
    28Consolidated Statements of Operations
    
    
    29Consolidated Statements of Stockholders Equity
and Comprehensive Loss
    
    
    30Consolidated Statements of Cash Flows
    
    
    31Notes to Consolidated Financial Statements
    
    
    32
 2.
    
    Financial Statements Schedules:
   3.
    
    Exhibits
  ExhibitNumber
    
    Description3.1
    
    
    Amended and Restated Certificate of Incorporation reflecting the change in the Companys name to
CalAmp Corp. and the increase in authorized common stock from 30 million to 40 million shares
(incorporated by reference to Exhibit 3.1 of the Companys Report on Form 10-Q for the period
ended August 31, 2004).3.2
    
    
    Bylaws of the Company (incorporated by reference to Exhibit 3.2 of the Companys Annual Report on
Form 10-K for the year ended February 28, 2005).4.1
    
    
    Amended and Restated Rights Agreement, amended and restated as of September 5, 2001, by
and between
Registrant and Mellon Investor Services LLC, as Rights Agent (incorporated by reference
to Exhibit 4.1
filed with Companys Annual Report on Form 10-K for the year ended February 28, 2007).4.2
    
    
    Warrant, dated December 14, 2007, issued by CalAmp Corp. to EchoStar Technologies
Corporation
(incorporated by reference to Exhibit 4.1 of the Companys Current Report on Form 8-K
dated December
14, 2007).
  52




---



##### 



ExhibitNumber
    
    Description10.
    
    
    Material Contracts:(i)   Other than Compensatory Plan or Arrangements:10.1
    
    
    Building lease dated June 10, 2003 between the Company and Sunbelt Enterprises for a
facility in Oxnard,
California (incorporated by reference to Exhibit 10-1 filed with the Companys Report on
Form 10-Q for
the quarter ended May 31, 2003).10.2
    
    
    Form of Directors and Officers Indemnity Agreement (incorporated by reference to Exhibit
10.3 of the
Companys Annual Report on Form 10-K for the year ended February 28, 2005).10.3
    
    
    Settlement Agreement, dated December 14, 2007, by and between CalAmp Corp. and EchoStar
Technologies Corporation (incorporated by reference to Exhibit 10.1 filed with the Companys
Current
Report on Form 8-K dated December 14, 2007).10.4
    
    
    Loan and Security Agreement dated December 22, 2009 between Square 1 Bank, CalAmp Corp.
and
CalAmps domestic subsidiaries (incorporated by reference to Exhibit 10.1 filed with the
Companys
Current Report on Form 8-K dated December 22, 2009).10.5
    
    
    Subordinated Note and Warrant Purchase Agreement dated December 22, 2009 between CalAmp
Corp.
and nine investors (incorporated by reference to Exhibit 10.2 filed with the Companys Current
Report on Form 8-K dated December 22, 2009).10.6
    
    
    Joinder Agreement dated January 15, 2010 between CalAmp Corp. and six investors
(incorporated by
reference to Exhibit 10.1 filed with the Companys Current Report on Form 8-K dated January
15, 2010).10.7
    
    
    Amendment to Loan Documents dated March 24, 2010 between Square 1 Bank, CalAmp Corp. and
CalAmps domestic subsidiaries.(ii)   Compensatory Plans or Arrangements required to be filed as Exhibits to this Report
pursuant to Item 15 (b) of this Report:10.8
    
    
    The 1999 Stock Option Plan (incorporated by reference to Exhibit 4.1 of the Companys
Registration
Statement No. 333-93097 on Form S-8)10.9
    
    
    CalAmp Corp. 2004 Stock Incentive Plan as amended and Restated (incorporated by
reference to Exhibit 10.6 filed with Companys Annual Report on Form 10-K for the year
ended February 28, 2007).10.10
    
    
    Employment Agreement between the Company and Richard Vitelle dated May 31, 2002
(incorporated by
reference to Exhibit 10.9 filed with Companys Annual Report on Form 10-K for the year
ended February
28, 2004).10.11
    
    
    Employment Agreement between the Company and Michael Burdiek dated July 2, 2007
(incorporated by
reference to Exhibit 10.1 of the Companys Report on Form 10-Q for the period ended May 31,
2007).10.12
    
    
    Employment Agreement between the Company and Garo Sarkissian dated July 2, 2007
(incorporated by
reference to Exhibit 10.2 of the Companys Report on Form 10-Q for the period ended May 31,
2007).10.13
    
    
    Employment Agreement between the Company and Richard Gold, effective March 4, 2008
(incorporated
by reference to Exhibit 10.1 of the Companys Current Report on Form 8-K dated March 4,
2008).10.14
    
    
    Form of Amendment to Employment Agreement dated December 19, 2008, for each of the
executive
officers: Richard Gold, Michael Burdiek, Richard Vitelle and Garo Sarkissian (incorporated by
reference
to Exhibit 10.1 of the Companys Report on Form 10-Q for the period ended November 29, 2008).10.15
    
    
    Second Amendment to Employment Agreement dated May 11, 2009 between the Company and
Richard
Gold (incorporated by reference to Exhibit 10.24 filed with Companys Annual Report on Form
10-K for
the year ended February 28, 2009)
  53




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##### 



ExhibitNumber
    
    Description21
    
    
    Subsidiaries of the Registrant.23.1
    
    
    Consent of Independent Registered Public Accounting Firm.23.2
    
    
    Consent of Independent Registered Public Accounting Firm.31.1
    
    
    Certification of Chief Executive Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Chief Financial Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.32
    
    
    Certification of Chief Executive Officer and Chief
Financial Officer pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
 (b)
    
    Each management contract or compensatory plan or arrangement required to be filed as an exhibit
to this form is filed as part of Item 15(a)(3)Exhibits and specifically identified as such.(c)
    
    Other Financial Statement Schedules. None  54




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##### 



CALAMP CORP.By:
    /s/ Richard GoldRichard GoldChief Executive Officer  Signature
    
    Title
    
    Date/s/ Frank Perna, Jr.

Frank Perna, Jr.
    
    Chairman of the Board of Directors
    
    May 4, 2010/s/ Kimberly Alexy

Kimberly Alexy
    
    Director
    
    May 4, 2010/s/ A.J. Moyer

A.J. Moyer
    
    Director
    
    May 4, 2010/s/ Thomas Pardun

Thomas Pardun
    
    Director
    
    May 4, 2010/s/ Larry Wolfe

Larry Wolfe
    
    Director
    
    May 4, 2010/s/ Richard Gold

Richard Gold
    
    Chief Executive Officer and Director 

(principal executive officer)
    
    May 6, 2010/s/ Richard Vitelle

Richard Vitelle
    
    VP Finance, Chief Financial Officer and Treasurer 

(principal accounting officer)
    
    May 6, 2010
  55