CALAMP CORP. : Entering into a Material Definitive Agreement, Creating a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Registrant Arrangement, Financial Statements and Exhibits (Form 8-K)

Section 1.01 Entering into a Material Definitive Agreement.

On July 13, 2022 (the “Closing Date”), CalAmp Corp. (the “Company”) and two of its national subsidiaries, CalAmp wireless networking company and Synovia Solutions, LLC (together with the Company, the “Borrowers”), have entered into a revolving credit and guarantee agreement (the “Credit Agreement”) with PNC Bank, North Americaas lender and administrative agent (“NCP Bank” or the “Agent”). The Credit Agreement provides for an asset-based senior secured revolving credit facility under which the Borrowers may borrow up to an aggregate of $50.0 million (the “Credit Facility”), subject to certain conditions, including borrowing base provisions that limit borrowing capacity to 80% of eligible customer accounts and 50% of eligible inventory, each set forth in more detail in the credit agreement. The credit facility will terminate and all outstanding loans will become due and payable on the earliest of the following dates: July 13, 2025 and the date that is ninety days prior to the maturity date of the Company’s senior unsecured convertible notes due 2025. Proceeds from loans made under the credit agreement may be used for the fund turnover and general business needs, which could include acquisitions.

Loans under the Credit Agreement bear interest at, at the option of the borrowers, Bloomberg’s short-term bank rate of return plus a margin of 2.50% per annum or another base rate plus a margin of 1.50% per year. Over the term of the credit facility, borrowers will pay an unused line fee ranging from 0.50% to 0.75% per annum, depending on the level of borrowings, payable quarterly in arrears.

Amounts due under the credit facility are secured by the borrowers and secured by substantially all of the assets of the borrowers.

The Credit Agreement contains customary affirmative covenants, including financial statement reporting requirements, and customary negative covenants that limit the ability of the Company and its subsidiaries to, among other things, pay dividends, incur debt, to create liens and encumbrances, to acquire, merge, consolidate with or into another person or entity, to make investments and to redeem or repurchase shares. The Credit Agreement also contains a financial covenant requiring the Company to maintain a Fixed Charge Coverage Ratio, as defined, of at least 1.10 to 1.00, measured on the last day of each fiscal quarter if the the company’s liquidity, consisting of specified cash balances plus unused availability on the credit facility, falls below $40.0 million such day. In addition, the Credit Agreement contains a Cash Dominion Trigger whereby PNC Bank may direct cash balances and domestic receipts to repay borrowings under the Credit Facility if the Company’s liquidity position, consisting of specified cash balances plus unused availability on the credit facility, falls below $25.0 million at the end of any month.

The Credit Agreement contains customary events of default, such as non-payment of obligations when due, commencement of bankruptcy or insolvency proceedings, default of certain other debts, change of control or breach of representations and warranties or covenants. In the event of default, lenders can demand immediate payment of all outstanding amounts and seize the security.

The above description of the Credit Agreement is not, and does not purport to be, complete and is qualified in its entirety by reference to the Credit Agreement, which is attached hereto as Schedule 10.1 and filed with present. In the normal course of their respective businesses, the lenders under the Credit Agreement and their affiliates have engaged, and may engage in the future, in commercial banking and/or investment banking transactions with the Company and its affiliates.

Item 2.03 Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant.

The information set out in point 1.01 above is incorporated herein by reference.

Item 9.01 Financial statements and supporting documents.

(d) Exhibits

Exhibit                                   Description

10.1        Revolving Credit and Security Agreement, dated as of July 13, 2022, among
          the Company, CalAmp Wireless Networks Corporation, Synovia Solutions, LLC,
          and PNC Bank
104       Cover Page Interactive Data File (embedded within the Inline XBRL document)

————————————————– ——————————

© Edgar Online, source Previews

Comments are closed.