Exhibit 10-2
SEVENTH AMENDMENT AND CONSENT TO CREDIT AGREEMENT
This Seventh Amendment and Consent to Credit Agreement (herein, the
"Amendment") is entered into as of February 13, 2009, among CalAmp Corp., a
Delaware corporation (the "Borrower"), the lenders party hereto (herein, the
"Lenders"), and Bank of Montreal, as administrative agent for the Lenders
(the "Administrative Agent").
PRELIMINARY STATEMENTS:
A. The Borrower, certain subsidiaries of the Borrower, as guarantors,
the Administrative Agent, and the other Lenders have entered into that
certain Credit Agreement dated as of May 26, 2006 (such Credit Agreement, as
the same has been or may be amended, modified or restated from time to time,
hereinafter referred to as the "Credit Agreement"). All defined terms used
herein shall have the same meaning as in the Credit Agreement unless
otherwise defined herein.
B. The Borrower has requested that the Lenders (i) amend the financial
covenants, (ii) consent to an accelerated repayment schedule of the EchoStar
Note, and (iii) make certain other amendments to the Credit Agreement, and
the Required Lenders are willing to so consent and so amend the Credit
Agreement, all in the manner and on the terms and conditions hereinafter set
forth.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
SECTION 1. CONSENT.
The Borrower has requested that the Lenders consent to an accelerated
repayment schedule for the EchoStar Note, such that the Borrower shall repay
the EchoStar Note by $20.00 per unit with respect to the first 120,000 units
of the so-called DPP Triples sold to EchoStar Technologies Corporation
beginning January 1, 2009. By signing below, the Lenders hereby consent to,
and only consent to, the accelerated repayment schedule set forth above,
provided that the Borrower and its Subsidiaries satisfy the conditions
precedent set forth in Section 3 below.
SECTION 2. AMENDMENTS.
Subject to the satisfaction of the conditions precedent set forth in
Section 4 below, the Credit Agreement shall be and hereby is amended as
follows:
2.1. Section 1.8(a) of the Credit Agreement shall be amended and
restated in its entirety to read as follows:
Section 1.8. Maturity of Loans. (a)Scheduled Payments
of Term Loans. The Borrower shall make principal payments on
the Term Loans in installments on the last day of each March,
June, September, and December in each year (and a special one-
time payment on February 28, 2009), with the amount of each
such principal installment to equal the amount set forth in
Column B below shown opposite of the relevant due date as set
forth in Column A below:
Column A Column B
Scheduled Principal
Payment Date Payment on Term Loans
02/28/09 $150,000
03/31/09 $1,250,000
06/30/09 $1,600,000
09/30/09 $1,600,000
, it being agreed that the final payment of both principal
and interest not previously paid on the Term Loans shall be
due and payable on December 31, 2009 (the "Term Loan Maturity
Date"). Each such principal payment shall be applied to the
Lenders holding the Term Loans pro rata based upon their Term
Loan Percentages.
2.2. Section 1.9 (Prepayments) of the Credit Agreement shall be amended
by inserting a new clause (v) into Section 1.9(b) to read as follows:
(v) By no later than February 13, 2009, with respect to
January 2009, and by no later than 7 days after the last day
of each fiscal month ending thereafter, the Borrower shall
prepay the Term Loans in an aggregate amount equal to the
product of $7.50 multiplied by the number of units of the so-
called DPP Triples sold to EchoStar Technologies Corporation
during such fiscal month; provided, however, that such
prepayment calculation shall only include the first 120,000
units of the so-called DPP Triples sold to EchoStar
Technologies Corporation since January 1, 2009.
2.3. The definition of Net Income appearing in Section 5.1 shall be
amended and restated to read as follows:
"Net Income" means, with reference to any period, the
net income (or net loss) of the Borrower and its Subsidiaries
for such period computed on a consolidated basis in accordance
with GAAP; provided that there shall be excluded from Net
Income (a) the net income (or net loss) of any Person (other
than a Subsidiary) in which the Borrower or any of its
Subsidiaries has a equity interest in, except to the extent of
the amount of dividends or other distributions actually paid
to the Borrower or any of its Subsidiaries during such period,
(b) any extraordinary gains or losses in accordance with GAAP
(and the tax effects thereof), (c) one-time, non-recurring,
non-operating gains and losses approved in writing by the
Administrative Agent, (d) all non-cash income and (e) any
proceeds from the settlement of the Xxxxxx Corporation
litigation.
2.4. Section 8.21 (Financial Covenants) shall be amended and restated
in its entirety to read as follows:
Section 8.21. Financial Covenants. (a) Total Leverage
Ratio. Reserved.
(b) Tangible Net Worth. Reserved
(c) Fixed Charge Coverage Ratio. Reserved.
(d) Minimum EBITDA. The Borrower shall not, as of the
last day of each period set forth below, permit EBITDA for
such period to be less than:
EBITDA SHALL
PERIOD NOT BE LESS THAN:
12 Months ending 2/28/2009 $364,000
12 Months ending 5/30/2009 ($1,064,000)
12 Months ending 8/29/2009 ($473,000)
12 Months ending 11/28/2009 $1,210,000
(e) Minimum Sales of Wireless DataCom Division. As
of the last day of each fiscal month set forth below, the
Borrower shall not permit sales of the Wireless DataCom
Division for the past three (3) months to be less than:
SALES OF WIRELESS DIVISION SHALL
FISCAL MONTH ENDING NOT BE LESS THAN:
1/24/2009 $12,844,000
2/28/2009 $13,005,000
3/28/2009 $13,770,000
4/25/2009 $14,195,000
5/30/2009 $13,430,000
6/27/2009 $13,770,000
7/25/2009 $14,025,000
8/29/2009 $14,450,000
9/26/2009 $14,875,000
10/24/2009 $15,300,000
11/28/2009 $15,725,000
12/26/2009 $15,640,000
SECTION 3. CONDITIONS PRECEDENT.
The effectiveness of this Amendment is subject to the satisfaction of
all of the following conditions precedent:
3.1. The Borrower, the Administrative Agent and the Required Lenders
shall have executed and delivered this Amendment.
3.2. The Administrative Agent shall have received copies (executed or
certified, as may be appropriate) of all legal documents or proceedings taken
in connection with the execution and delivery of this Amendment to the extent
the Administrative Agent or its counsel may reasonably request.
3.3. Legal matters incident to the execution and delivery of this
Amendment shall be satisfactory to the Administrative Agent and its counsel.
3.4. The Guarantors shall have executed their reaffirmation,
acknowledgment, and consent in the space provided for that purpose below.
3.5. The Borrower shall have paid any invoices for professional
services rendered on behalf of the Administrative Agent, including legal
fees.
SECTION 4. REPRESENTATIONS.
In order to induce the Lenders to execute and deliver this Amendment,
the Borrower hereby represents to the Lenders that as of the date hereof
after giving effect to this Amendment the representations and warranties set
forth in Section 6 of the Credit Agreement are and shall be and remain true
and correct in all material respects, except to the extent the same expressly
relate to an earlier date (except that the representations contained in
Section 6.5 shall be deemed to refer to the most recent financial statements
of the Borrower delivered to the Administrative Agent) and the Borrower is in
compliance with the terms and conditions of the Credit Agreement and no
Default or Event of Default has occurred and is continuing under the Credit
Agreement or shall result after giving effect to this Amendment.
SECTION 5. MISCELLANEOUS.
5.1. The Borrower and the Guarantors heretofore executed and delivered
to the Administrative Agent certain Collateral Documents and the Borrower
hereby, and the Guarantors by signing below, acknowledge and agree, that,
notwithstanding the execution and delivery of this Amendment, the Collateral
Documents remain in full force and effect and the rights and remedies of the
Agent and the Lenders, the obligations of the Borrower and the Guarantors
thereunder and the liens and security interests created and provided for
thereunder remain in full force and effect and shall not be affected,
impaired or discharged hereby. Nothing herein contained shall in any manner
affect or impair the priority of the liens and security interests created and
provided for by the Collateral Documents as to the indebtedness which would
be secured thereby prior to giving effect to this Amendment.
5.2. Except as specifically amended herein, the Credit Agreement shall
continue in full force and effect in accordance with its original terms.
Reference to this specific Amendment need not be made in the Credit
Agreement, the Notes, or any other instrument or document executed in
connection therewith, or in any certificate, letter or communication issued
or made pursuant to or with respect to the Credit Agreement, any reference in
any of such items to the Credit Agreement being sufficient to refer to the
Credit Agreement as amended hereby.
5.3. The Borrower agrees to pay on demand all reasonable costs and
expenses of or incurred by the Administrative Agent in connection with the
negotiation, preparation, execution and delivery of this Amendment, including
the reasonable fees and expenses of counsel for the Administrative Agent.
5.4. This Amendment may be executed in any number of counterparts, and
by the different parties on different counterpart signature pages, all of
which taken together shall constitute one and the same agreement. Any of the
parties hereto may execute this Amendment by signing any such counterpart and
each of such counterparts shall for all purposes be deemed to be an original.
This Amendment shall be governed by the internal laws of the State of New
York.
5.5. FOR VALUE RECEIVED, INCLUDING WITHOUT LIMITATION, THE AGREEMENTS
OF THE LENDERS IN THIS AGREEMENT, THE BORROWER HEREBY RELEASES THE
ADMINISTRATIVE AGENT AND EACH LENDER, ITS CURRENT AND FORMER SHAREHOLDERS,
DIRECTORS, OFFICERS, AGENTS, EMPLOYEES, ATTORNEYS, CONSULTANTS, AND
PROFESSIONAL ADVISORS (COLLECTIVELY, THE "RELEASED PARTIES") OF AND FROM ANY
AND ALL DEMANDS, ACTIONS, CAUSES OF ACTION, SUITS, CONTROVERSIES, ACTS AND
OMISSIONS, LIABILITIES, AND OTHER CLAIMS OF EVERY KIND OR NATURE WHATSOEVER,
BOTH IN LAW AND IN EQUITY, KNOWN OR UNKNOWN, WHICH THE BORROWER HAS OR EVER
HAD AGAINST THE RELEASED PARTIES, INCLUDING, WITHOUT LIMITATION, THOSE
ARISING OUT OF THE EXISTING FINANCING ARRANGEMENTS BETWEEN THE BORROWER AND
THE LENDERS, AND THE BORROWER FURTHER ACKNOWLEDGES THAT, AS OF THE DATE
HEREOF, IT DOES NOT HAVE ANY COUNTERCLAIM, SET-OFF, OR DEFENSE AGAINST THE
RELEASED PARTIES, EACH OF WHICH THE BORROWER HEREBY EXPRESSLY WAIVES.
[SIGNATURE PAGE TO FOLLOW]
This Seventh Amendment and Consent to Credit Agreement is entered into
as of the date and year first above written.
"BORROWER"
CALAMP CORP.
By /s/ Xxxxxxx X. Xxxxxxx
------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President of Finance
Accepted and agreed to by the Lenders.
"LENDERS"
BANK OF MONTREAL, acting through its Chicago
Branch, in its individual capacity as a
Lender, as L/C Issuer, and as
Administrative Agent
By /s/ Xxxxxxxx XxXxxxxxx
------------------------
Name Xxxxxxxx XxXxxxxxx
Title Managing Director
UNION BANK OF CALIFORNIA, N.A.
By /s/ Xxxxxx X. Xxxxxxxx
------------------------
Name Xxxxxx X. Xxxxxxxx
Title Vice President
BANK OF THE WEST
By /s/
------------------------
Name
Title
REAFFIRMATION, ACKNOWLEDGEMENT AND CONSENT OF GUARANTORS
Each of the undersigned, the Guarantors, heretofore executed and
delivered to the Administrative Agent, on behalf of the Lenders, the Credit
Agreement or an Additional Guarantor Supplement. Each of the undersigned
hereby consents to the Seventh Amendment and Consent to Credit Agreement (the
"Amendment") set forth above and confirms that its Guaranty, and all
obligations of the undersigned thereunder, remains in full force and effect.
Each of the undersigned further agrees that the consent of the undersigned to
any further amendments to the Credit Agreement shall not be required as a
result of this consent having been obtained. Each of the undersigned
acknowledges that the Lenders are relying on the assurances provided herein
in entering into the Amendment.
"GUARANTORS"
CALAMP SOLUTIONS HOLDINGS, INC.
By /s/ Xxxx X. Xxxxx
------------------------
Name: Xxxx X. Xxxxx
Title: President
CALAMP SOLUTIONS, INC.
By /s/ Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: President
DATARADIO HOLDINGS, INC.
By /s/ Xxxx Xxxxxxxxxx
------------------------
Name: Xxxx Xxxxxxxxxx
Title: President
DATARADIO CORPORATION
By /s/ Xxxxxxx X. Xxxxxxx
------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Treasurer
DATARADIO COR LTD.
By /s/ Xxxx Xxxxxxxxxx
------------------------
Name: Xxxx Xxxxxxxxxx
Title: President
