UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 9, 2006
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Exact Name of Registrant as
Specified in Its Charter: CALAMP CORP.
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DELAWARE 0-12182 95-3647070
_____________________________ ____________ _____________
State or Other Jurisdiction of Commission I.R.S. Employer
Incorporation or Organization File Number Identification No.
Address of Principal Executive Offices: 1401 N. Rice Avenue
Oxnard, CA 93030
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Registrant's Telephone Number, Including
Area Code: (805) 987-9000
_________________________
Former Name or Former Address,
if Changed Since Last Report: Not applicable
_____________________________
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 425 under the Exchange Act
(17 CFR 240.14.a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01. Entry into a Material Definitive Agreement
As previously announced, on May 9, 2006, CalAmp Corp. (the "Company")
signed a definitive Share Purchase Agreement (the "Agreement") to acquire all
of the outstanding common shares of Dataradio, Inc. ("Dataradio"), a privately
held Canadian company. The parties to the Agreement are the Company,
Dataradio, the stockholders of Dataradio and a newly formed wholly-owned
subsidiary of the Company incorporated under the laws of Canada ("Acquisition
Sub"). Dataradio is currently focused in three primary business lines:
wireless data systems for public safety and first response applications;
wireless data modems for fixed location critical infrastructure and industrial
applications; and design and manufacture of radio frequency modules.
Dataradio has approximately 175 employees at facilities located in Montreal,
Minnesota and Georgia.
The purchase price is Canadian $60.1 million in cash (approximately U.S.
$54.6 million at the current Canadian Dollar to U.S. Dollar exchange rate of
1.10). However, if the stockholders' equity of Dataradio as of the closing
date is less than Canadian $12.1 million, the purchase price will be reduced
by an amount equal to the product of five times the Canadian Dollar amount of
such deficiency, up to a maximum of Canadian $6 million. Dataradio's selling
stockholders have agreed that Dataradio's closing balance sheet will include
at least Canadian $6 million in cash to fund the payment immediately after the
closing of certain accrued liabilities of Dataradio as of the closing date in
the amount of $5.9 million. If the cash balance at the closing date is less
than Canadian $6 million, the purchase price will be reduced by the amount of
such deficiency.
The parties have made customary representations and warranties. Subject
to certain limitations set forth in the Agreement, the Dataradio stockholders
will indemnify the Company, Acquisition Sub and their affiliates with respect
to any and all losses incurred in connection with any breach by Dataradio or
the selling stockholders of any representation, warranty, covenant or other
agreement. The Company, Acquisition Sub and their affiliates will also be
indemnified with respect to certain specified items, including any claims made
with respect to options and workers' compensation issues. The Company and
Acquisition Sub have provided certain reciprocal indemnifications to the
selling stockholders. No party may pursue indemnification claims against
another party unless and until the total damages suffered by such party exceed
Canadian $75,000 (the "Threshold Amount"), after which such party will be
entitled to indemnification only for damages in excess of the Threshold Amount
The indemnification obligations of each party will be limited to Canadian $5
million (the "Cap"). Neither the Threshold Amount nor the Cap will apply to
any indemnification obligation related to fraud, intentional misrepresentation
or active concealment, and the Cap also will not apply to breaches of certain
specified representations and warranties made by Dataradio or the selling
stockholders. The representations and warranties of Dataradio and its selling
stockholders generally will survive for two years following the closing, with
certain representations and warranties surviving for up to five years.
Completion of the acquisition is subject to customary closing
conditions, including the receipt of consents of certain third parties.
On the closing date, Canadian $7 million of the purchase price will be
deposited into escrow, of which Canadian $3 million will be available as a
source for the payment of indemnification claims and Canadian $4 million will
be available for the payment of any obligation arising out of the purchase
price adjustments. The remaining amount will be distributed to Dataradio's
selling stockholders on the second anniversary of the closing date, with
amounts required to pay claims by the Company that are not resolved by such
second anniversary to be held in the escrow account until such claims are
resolved.
If the Agreement is terminated after June 30, 2006 by a party that is not
then in breach of the Agreement, and Dataradio is purchased by another party
before the six-month anniversary of such termination for total consideration
greater than Canadian $60 million net of cash on hand, then Dataradio will pay
the Company a termination fee of Canadian $4 million as liquidated damages.
The Company plans to finance the transaction using a combination of new
bank debt of approximately U.S. $33 million and its cash on hand.
The Company had no material relationship with any of the sellers, other
than in respect of this material definitive agreement. The transaction is
expected to close in the next several weeks.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
CALAMP CORP.
May 11, 2006 By: /s/ Richard K. Vitelle
_________________ _________________________
Date Richard K. Vitelle,
Vice President-Finance
(Principal Financial Officer)