CalAmp Extends Bank Credit Facility and Retires 12% Subordinated Notes
August 16 2011 - 8:00AM
Marketwired
CalAmp Corp. (NASDAQ: CAMP), a leading
provider of wireless products, services and solutions, today
announced that on August 15, 2011, it entered into a 4th amendment
to its credit facility with Square 1 Bank. Concurrent with this
amended senior credit agreement, the Company retired its 12%
subordinated notes at par in the aggregate principal amount of $5
million plus accrued interest. The funds to pay off the
subordinated notes were provided by the Company's operating cash
flows and borrowings under the amended bank credit facility.
The bank credit facility, as amended, provides for borrowings of
up to $12 million, comprised of a $3 million term loan and a
revolver of up to $12 million less the then-outstanding principal
amount of the term loan (subject to a borrowing base). As of August
15, 2011, the borrowing limit on the revolver was $9 million. The
amended credit facility has a maturity date of August 15, 2014, and
an interest rate on all borrowings of the bank's prime rate plus
1%, which is a current effective rate of 4.25%, with no monthly
minimum rate or floor amount. The prior interest rate on the
revolver was prime plus 2%, with a minimum effective rate of 6%.
The revolver borrowing limit is equal to the lesser of (a) $12
million minus the term loan principal outstanding at any point in
time, or (b) 85% of eligible accounts receivable. The term loan
principal is repayable at the rate of $100,000 per month beginning
April 2012. As a result of this amendment and subordinated note
payoff, CalAmp expects to reduce its annual cash interest expense
by approximately $0.5 million.
The 12% subordinated notes had a maturity date of December 22,
2012. As a result of the early redemption of these notes, the
Company will record a non-cash charge of approximately $0.5 million
in the fiscal 2012 second quarter for the accelerated write-off of
debt issue costs and discount that would otherwise have been
ratably recognized as interest expense over the next 5
quarters.
Michael Burdiek, President and CEO, commented, "We are very
pleased to have renewed our credit facility with Square 1 Bank with
new terms that provide greater financial flexibility as we look to
capitalize on market growth opportunities. Over the past two years
our working relationship with Square 1 has been outstanding, and I
believe the successful completion of this amended credit facility
demonstrates the confidence that Square 1 has in CalAmp's
future."
About CalAmp CalAmp develops and markets
wireless communications solutions that deliver data, voice and
video for critical networked applications. The Company's two
business segments are Wireless DataCom, which serves utility,
government and enterprise customers, and Satellite, which focuses
on the North American Direct Broadcast Satellite market. For more
information, please visit www.calamp.com.
Forward-Looking Statements Statements in
this press release that are not historical in nature are
forward-looking statements that involve known and unknown risks and
uncertainties. Words such as "may," "will," "expect," "intend,"
"plan," "believe," "seek," "could," "estimate," "judgment,"
"targeting," "should," "anticipate," "goal" and variations of these
words and similar expressions, are intended to identify
forward-looking statements. Actual results could differ materially
from those implied by such forward-looking statements due to a
variety of factors, including product demand, competitive pressures
and pricing declines in the Company's satellite and wireless
datacom markets, the timing of customer approvals of new product
designs, the length and extent of the global economic downturn that
has and may continue to adversely affect the Company's business,
and other risks or uncertainties that are described in the
Company's Report on Form 10-K for fiscal 2011 as filed on April 28,
2011 with the Securities and Exchange Commission. Although the
Company believes the expectations reflected in such forward-looking
statements are based upon reasonable assumptions, it can give no
assurance that its expectations will be attained. The Company
undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
AT THE COMPANY: Rick Vitelle Chief Financial Officer
(805) 987-9000 AT FINANCIAL RELATIONS BOARD: Marilynn Meek
General Information (212) 827-3773 mmeek@mww.com
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