CAMP4 Therapeutics Corporation Annual Report 2022

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FY2022 Annual Report · CAMP4 Therapeutics Corporation

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CalAmp

15635 Alton Parkway, Suite 250

Irvine, CA 92618

888.3CALAMP

calamp.com

2022 Annual Report

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, 2022
☐☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ____ to ____
COMMISSION FILE NUMBER: 0-12182

CALAMP CORP.

(Exact name of Registrant as specified in its Charter)

Delaware
(State or other jurisdiction of
incorporation or organization)
15635 Alton Parkway, Suite 250
Irvine, California
(Address of principal executive offices)

95-3647070
(I.R.S. Employer
Identification No.)

92618
(Zip Code)

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (949) 600-5600

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

TITLE OF EACH CLASS
$0.01 par value Common Stock

TRADING SYMBOL(S)
CAMP

NAME OF EACH EXCHANGE
The Nasdaq Stock Market LLC
(The Nasdaq Global Select Market)

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒.

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days. Yes ☒ No ☐.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth
company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the
Exchange Act.:

Large accelerated filer
Non-accelerated filer
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised
financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes ☐ No ☐

Accelerated filer
Smaller reporting company

☐
☐
☐

☒
☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of August 31, 2021, the aggregate market value of shares held by non-affiliates of the registrant was approximately $336.3 million. For purposes of calculating the
aggregate market value of shares held by non-affiliates, we have assumed that all outstanding shares are held by non-affiliates, except for shares held by each of our
executive officers, directors and 10% or greater stockholders. These assumptions should not be deemed to constitute an admission that all executive officers, directors
and 10% or greater stockholders are, in fact, affiliates of our company. As of April 21, 2022, there were 36,058,448 shares of the registrant’s common stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant’s definitive Proxy Statement for the Annual Meeting of Stockholders to be held on July 26, 2022 are incorporated by reference into Part III,
Items 10, 11, 12, 13 and 14 of this Form 10-K. This Proxy Statement will be filed within 120 days after the end of the fiscal year covered by this report.

Table of Contents

PART I
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.

PART II
Item 5.

Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.
Item 9C.

PART III
Item 10.
Item 11.
Item 12.

Item 13.
Item 14.

PART IV
Item 15.

Business.......................................................................................................................................
Risk Factors.................................................................................................................................
Unresolved Staff Comments .......................................................................................................
Properties.....................................................................................................................................
Legal Proceedings .......................................................................................................................
Mine Safety Disclosures..............................................................................................................

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases
of Equity Securities .....................................................................................................................
Selected Financial Data ...............................................................................................................
Management’s Discussion and Analysis of Financial Condition and Results of Operations .....
Quantitative and Qualitative Disclosures About Market Risk ....................................................
Financial Statements and Supplementary Data ...........................................................................
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure ....
Controls and Procedures..............................................................................................................
Other Information........................................................................................................................
Disclosure Regarding Foreign Jurisdictions That Prevent Inspections.......................................

Directors, Executive Officers and Corporate Governance..........................................................
Executive Compensation.............................................................................................................
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters.........................................................................................................................................
Certain Relationships and Related Transactions, and Director Independence............................
Principal Accounting Fees and Services .....................................................................................

Exhibits, Financial Statement Schedules.....................................................................................

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PART I

ITEM 1.

BUSINESS

Company Overview

CalAmp Corp. (including its subsidiaries unless the context otherwise requires, “CalAmp”, “the Company”,
“we”, “our”, or “us”) is a connected intelligence company that leverages a data-driven solutions ecosystem to help
people and organizations improve operational performance. We solve complex problems for customers within the
market verticals of transportation and logistics, commercial and government fleets, industrial equipment, and
consumer vehicles by providing solutions that track, monitor, and recover their vital assets. The data and insights
enabled by CalAmp solutions provide real-time visibility into a user’s vehicles, assets, drivers, and cargo, giving
organizations greater understanding and control of their operations. Ultimately, these insights drive operational
visibility, safety, efficiency, maintenance, and sustainability for organizations around the world.

Currently, CalAmp is generating data for a global customer portfolio across an installed base of approximately
10 million devices reporting to our cloud-based platform. The magnitude and diversity of this data generation has
played an instrumental role in the development of our flexible and scalable cloud platform, the CalAmp Telematics
Cloud™ (“CTC”). CTC’s ability to ingest vast amounts and types of data is critical to the company’s long-term strategy
of providing differentiated insights to customers with a wide variety of needs and use cases. The platform also serves
as the backbone for CalAmp’s software applications, which offer user-friendly interfaces to interact with the data and
insights produced at the edge and in the cloud. Finally, to better address customer needs and enable a focused
investment strategy, CalAmp is focused on enabling partnerships with third-party organizations, integrating devices,
services, and application features into our consolidated solutions.

CalAmp’s ability to provide a full stack solution to end-users across the globe uniquely positions the company
to capitalize on a $62 billion total addressable market (“TAM”) that is growing at a 5-year compounded annual growth
rate of approximately 20%.1 The market in which we compete is highly fragmented, with the majority of competitors
serving a range of subsets of CalAmp’s addressable market. We believe that this fragmentation will allow CalAmp to
offer unparalleled value through a consolidated solution set. The company is focusing on transforming towards this
vision by building out data-driven solutions, a robust portfolio of partners, and a world-class team of people.

The complexity that exists within CalAmp’s operating environment continues to be primarily driven by macro-
economic conditions, competitive markets, global regulatory environments, technological evolution, the COVID-19
pandemic, and other macro-political and economic factors. We believe that the effect that these factors have on our
customers further substantiates and augments the value of our solutions. As our customers’ operating complexity and
costs continue to rise, the deployment of advanced telematics solutions becomes even more imperative. To maintain
or enhance market share, revenue, profitability, and customer satisfaction, our customers require optimally efficient
operating strategies, enabled by the visibility that CalAmp solutions provide.

1 Gartner, Market Guide for Transportation Mobility Technology (March 2021), Berg Insight, Trailer and Cargo Container Tracking (2021), Berg
Insight, Global Automotive OEM Telematics Market (2021), and Berg Insight, Global Construction Equipment OEM Telematics Market (2021)

Our Solutions

CalAmp Telematics Cloud (“CTC”). Since not all customers’ needs are the same, CalAmp offers flexible
solutions to meet the requirements of varying organizations, business processes and operational strategies. At the
This dependable and highly scalable platform seamlessly
core of the CalAmp approach is the CTC platform.
integrates with CalAmp’s edge computing products to provide customers detailed information and insights via
Software-as-a-Service (“SaaS”). The information captured here helps companies more efficiently manage their vital
assets including fleet video intelligence, remote asset tracking, real-time crash response and driver behavior scoring,
among others. Customers can choose to access this information via intuitive purpose-built SaaS applications and/or
they can programmatically integrate information from CTC with their own custom in-house applications and
workflows using open Application Programming Interfaces (“APIs”) also offered by CalAmp.
In this way,
customers who want a complete turnkey solution can quickly leverage CalAmp’s information and insights while those
customers wishing to integrate that information into their own applications and processes can easily do so, also.

Intuitive SaaS Applications. We provide our customers with intelligent analytics and reporting solutions that
are accessible via a single view, user-friendly interface through a SaaS-based application designed to address market
needs. This application, called CalAmp iOn™, is purpose-built for fleets, transportation and logistics needs, and
industrial equipment, turning multiple data feeds from previously unconnected networks of vehicles, drivers and
associated assets into clear and actionable insights that optimize operations, increase productivity and deliver
compelling return on investment for virtually any business challenge. The applications also deliver real-time visibility
about the location and environmental status of pharmaceuticals, electronics, food or other perishables from the
manufacturing plant or point of origin to the point of delivery, helping to manage quality and compliance across land,
air or sea shipments. Our K-through-12 solutions include Here Comes The Bus®, an award-winning mobile

application that provides real-time school bus location through push notifications and email alerts to help family
members monitor bus arrival and keep students safe. Bus Guardian™ enables contact tracing and hygiene verification
to keep students, drivers and other school staff safe amid the COVID-19 pandemic.

CalAmp Marketplace. The CalAmp Marketplace provides enhanced contextual information from third party
systems or partners that augment the core telematics data being captured by CTC to provide customers with improved
understanding of their business. Examples of these value-added insights include crash detection and notifications that
speed life-saving assistance to drivers and fleet operators, and predictive remote diagnostics that enable preemptive
alerts about vehicle issues before critical failures occur. This valued-added information provided by all the CalAmp
Marketplace offerings bolsters the value we provide customers while also improving customer retention rates.

Developer Portal. The CalAmp Telematics Cloud is the core engine that enables seamless management of
data through a diverse set of assets, from service vehicles to high-value equipment. CTC is an enablement platform
that connects our customers to edge data and insights for a wide range of applications and software services. Through
CTC CalAmp provides the Developer Portal to facilitate integration with third-party applications through open APIs.
Our partners leverage the multiple APIs we’ve created to rapidly deliver full-featured telematics solutions to their
customers and markets. Our proven CTC platform is architected to integrate with numerous global Mobile Network
Operator account management systems and leverage these carrier backend systems to provide customers access to
services that are essential for creating and managing flexible end-to-end solutions.

Flexible Edge Computing Products. We offer a series of telematics edge products that serve as the foundation
of our mobile connected ecosystem by collecting data insights from vehicles, drivers, assets, and cargo. These wireless
enabled devices--including asset tracking units, mobile telematics devices, fixed and mobile wireless gateways and
routers--underpin our wide range of proprietary and third-party software applications and services for business-critical
deployments demanding secure and reliable communications and controls anywhere in the world. Our customers
select our products and solutions based on optimized feature sets, programmability, configurability, manageability,
long-term support, reliability and, in particular, overall value.

Growth Strategy – Capitalize on $62B Total Addressable Market

Over the past several years, CalAmp has been focused on growing our subscription-based business through
expanded data and application-driven solutions offerings. This transition has been driven by our desire to enhance the
customer experience and maximize the value proposition that we provide our customers. By transforming our business
model and solutions portfolio to focus on data-driven insights and the application experience, CalAmp offers
customers the value and convenience of a consolidated full stack solution, while providing shareholders with the
confidence that accompanies an increasingly recurring and predictable revenue model.

CalAmp operates at the nexus of several large market opportunities, including fleet, transportation and logistics,
supply chain and connected-vehicle ecosystems, which includes tracking, monitoring, and recovering high-value
vehicles, equipment, cargo and other vital assets in the markets around the world. We also operate at global scale,
with a presence in the North American, EMEA, LATAM, and APAC regions, with plans to continue growing across
the board. We believe these market opportunities constitute a TAM of approximately $62 billion. To capitalize on this
TAM, our growth strategy includes the following key elements:

•

Drive Ongoing Transformation to SaaS Business Model. We are relentlessly pursuing our goal to grow
our software and subscription services business. To accomplish this goal, our team is focused on continual
innovation across our proprietary full stack solution. We believe that by leveraging our existing brand
presence and customer base, we can drive growth through the adoption of our software applications and
open API solutions. As CalAmp continues to drive significant subscriber growth, the increased volumes
of data will drive our innovation roadmaps towards increasingly unique and differentiated solutions. This
strategy begins with converting the legacy installed base to SaaS arrangements, while simultaneously
ramping up SaaS sales volumes to both new and existing customers.

Launch New Innovative Software Solutions in the Emerging Connected Asset Market Worldwide.
Across the globe, CalAmp has established highly recognizable brands, as well as strong and unique
relationships with the most reputable companies in each of our verticals. This is a direct result of the
company’s ability to consistently push the frontiers of innovation and develop customer-focused solutions.
With innovation as a central component of our culture, CalAmp continues to develop new telematics

•

solutions for the connected asset market such as our award-winning iOn™ application, Here Comes the
Bus application and Bus Guardian solution.

Expand in Key Verticals and Target Geographies. CalAmp continues to leverage our existing customer
relationships, international subscribers, and recent acquisitions to further expand into global markets
including Latin America, Europe, Middle East & Africa, and Asia Pacific. Our global expansion strategy
is focused on countries with anticipated demand for our full stack of SaaS applications and data services.
The launch of iOn in EMEA demonstrates our commitment to execute on this strategy and extend the
value of our CTC platform and applications into global markets. We expect this strategy to generate
significant growth over time as our international solutions continue to mature and adjust to unique regional
market needs.

Continue to Help Customers Realize the Value of Fully Connected Ecosystems. Because CalAmp
solutions are capable of connecting diverse asset portfolios and offering consolidated insights, the value
of our solution grows as we become more embedded across customers’ operational ecosystems. This value
is not only attractive to new customers looking for a consolidated solution, but it is also the basis for our
ability to upsell existing customers. As our teams continue to build out innovative data services and edge
capabilities, we expect to see significant average revenue per unit (“ARPU”) expansion and new customer
growth.

Customer Benefits

Our software and subscription services solutions and edge-computing products are deployed in a wide variety
of applications across key market verticals ranging from small to large enterprises. Companies using CalAmp’s
solutions require constant communication with remote and/or mobile assets as they perform business-critical tasks
and services that are otherwise difficult to manage in real time. Our solutions provide a clear and demonstrable return
on investment for these customers by:

•

Improving efficiency, cost savings and sustainability. CalAmp’s solutions enable customers to gain
better control and visibility of how their drivers, cargo, assets and vehicles are operating. With this
information they are better able to streamline and optimize their operations which reduces fuel usage,
decreases labor costs and improves overall efficiency. Additionally, using less fuel reduces the carbon
footprint of an organization and helps them in reaching their sustainability goals.
Improving tracking and transparency. One of the most important benefits our customers receive by
using CalAmp’s solutions is gaining greater understanding of where and how their assets, vehicles, and
cargo are being used. The insights we provide help organizations operate more effectively, provide better
support to both their internal and external customers, and ensure that their resources are being properly
deployed, used and delivered.
Increasing safety and compliance. Because our solutions enable fleet operators to track, monitor and
gain greater transparency of how their vehicles and assets are being used, they also allow customers to
improve the behavior of employees which bolsters safety while also ensuring personnel are complying
with governance policies. Additionally, for K-through-12 students all over the U.S. and Canada, our
proprietary school bus tracking and mobile app provide pick-up and drop-off information to give parents
and students peace of mind as they travel to and from school.
Better maintenance and increased uptime. CalAmp’s solutions provide visibility into maintenance,
usage, and tracking of on- and off-road high-value assets including assets like vehicles, “yellow-iron” and
attachments, forklifts and loaders to generators, compressors and other mission-critical equipment. The
detailed insights into information like engine hours, impact and other diagnostics help our customers head
off issues before they occur in order to improve overall equipment/fleet uptime.

Manufacturing and Operations

While our products are largely designed in the U.S., we currently outsource our manufacturing to certain contract
manufacturers in Taiwan, Malaysia and Mexico as well as some limited production in China and Hong Kong. The
devices, components and assemblies used in our solutions and products can be obtained from these manufacturers,
although a few components are obtained from sole source suppliers. Although we do not have any long-term purchase
contracts, we have executed product supply agreements with these manufacturers, which provide for certain product
quality requirements. We are not vertically integrated, which provides us with flexibility and an ability to adapt to
changes in the market, product supply and pricing while keeping our fixed costs low. Our relationships with our

manufacturers are critical to the success of our business. We have strong relationships with our manufacturers, helping
us to meet supply and support requirements stipulated by our customers.

We focus on driving alignment of our solutions and product roadmaps with all our manufacturers and
determining what we can do collectively to reduce costs across the supply chain. Our operations team based in the
to develop the requisite
U.S. coordinates with our manufacturers’ engineers and quality control personnel
manufacturing processes, quality checks and testing as well as a general oversight of ongoing manufacturing activities.
We believe this model has allowed us to deliver high quality and innovative products in a timely manner while
enabling us to minimize costs, manage inventory risk and maintain flexibility.

We and our contract manufacturers are certified to the ISO (International Organization for Standardization)

9001 quality management systems standard.

Research and Development

We compete in markets characterized by industry disruption, rapid technological change, evolving industry
standards and new product features. We believe that our future success depends upon our ability to develop innovative
new products and solutions as well as enhancements to our existing products and solutions with advanced functionality
and ease of use to drive customer demand and to further enhance our global brand and drive recurring revenue. We
will continue to focus our research and development resources primarily on developing telematics products, services
and software solutions for fleet management, heavy equipment monitoring and optimization, stolen vehicle recovery,
consumer aftermarket telematics, trailer and asset tracking, transportation and logistics, and industrial monitoring. We
have developed a technology platform that can be leveraged across many of our vertical markets, applications and
geographic regions. This includes a cloud-based telematics application enablement platform and end-user software
applications, a comprehensive purpose-built telematics edge platform, cellular and satellite communications network-
based asset tracking units as well as 4G and 5G LTE broadband router products primarily for mobile applications. In
addition, our development resources have been allocated to rationalizing existing product lines, reducing product
costs, and improving performance through product redesign efforts. Our research and development efforts have
resulted in generating significant intellectual property in the telematics vertical as is evident in our broad patent
portfolio. We continue to actively pursue developing innovative solutions that add to our intellectual property
portfolio.

Our research and development expenses from continuing operations in fiscal years ended February 28/29, 2022,
2021 and 2020, were $28.4 million, $25.8 million and $27.0 million, respectively. During this three-year period, our
research and development expenses have ranged between 8% and 10% of annual consolidated revenues.

Sales and Marketing

We market and sell our solutions and services through our global direct sales organization, channel partner
program and Original Equipment Manufacturers (“OEM”) sales organizations while driving awareness through our
websites and digital presence. Our global direct sales organization consists of teams of field salespeople, key account
managers and business development managers, who work closely with solutions and applications specialists and other
internal sales support personnel. We have organized our field sales personnel, together with internal sales and field
support personnel, into teams within each business group based on their specialized knowledge and expertise relating
to specific solutions and service areas, geographies and customer groups. These sales teams are closely aligned with
their respective solutions management, engineering and operations organizations.

We sell our solutions and services to large global enterprises, small- to mid-sized companies, channel accounts
and distributors as well as industrial OEM customers. These categories of customers require very different selling
approaches and support requirements, and we have organized our sales teams to address these distinct requirements.
Additionally, certain customers often have unique technical requirements and manufacturing processes, and may
request specific system configurations, feature sets and designs. Sales to large enterprise customers often involve
complex program management and long sales cycles, and require close cooperation between sales, operations and
engineering personnel. As such, we have developed teams of key account managers and business development
managers to serve the unique requirements of these customers.

We also actively sell our products in certain markets through independent sales representatives and distributors.
In some cases, we have granted representatives and distributors exclusive authorization to sell certain products in

specific geographic areas. These agreements generally have a term of one year, which automatically renews on an
annual basis, and are generally terminable by either party following a specified notice period.

We will continue our investment in sales and marketing programs that further build brand awareness, improve
revenue generation and foster long-term relationships with our customers. Our marketing programs are focused on
supporting multi-channel product launches in new geographic markets.

Additionally, we are focused on maximizing our efficiency and the reach of our marketing spend by investing
in product marketing, content development, public relations, social media and digital marketing programs. These
programs are developed to educate our potential customers and other industry influencers to drive sales engagement
around our products and services. Our activities around product marketing, content development, public relations,
thought leadership, social media and digital marketing are aligned with our customary product launches, media
campaigns and presence at tradeshows and high exposure venues focused in the transportation and logistics sector
such as Technology and Maintenance Council (TMC), Management Conference & Exhibition (MCE) and other high-
profile industry events, as such in-person events recommence amid easing of COVID-19 restrictions.

Competition

Our markets are highly competitive. We face competition from small to large public and private competitors
some of which have greater financial, distribution, marketing and other resources as well as greater economies of scale
than we do. We believe the principal competitive factors impacting the market for our products and services are global
scale,
time-to-market,
responsiveness and price. We believe that we compete favorably in all of these areas. Our continued success in our
vertical markets will depend in part upon our ability to continue to innovate, design quality products and deploy
solutions at competitive prices and with superior support services to our customers.

innovation, reputation, customer service, product quality, functionality and reliability,

The competitive landscape is incredibly fragmented, and most companies offer solutions to solve the needs of
specific verticals, sub verticals, or asset classes. For instance, many companies specialize in cab and fleet visibility,
such as Geotab and Verizon Connect, while others specialize in trailer visibility, like Phillips Connect, Sky Bitz, and
Xirgo. However, we also encounter competitors like Keep Truckin’ and Samsara, who specialize in multiple verticals.

Backlog

Total consolidated backlog, comprised of our remaining performance obligations for software & subscription
services and telematics devices backlog aggregated $285 million at February 28, 2022, compared to $211 million at
February 28, 2021.

As of February 28, 2022, our remaining contractual performance obligations for software & subscription
services were $202 million as compared to $145 million as of February 28, 2021. The majority of our growth in
contractual performance obligations was driven by new customer acquisitions within the government and
municipalities and connected car markets as well as the conversion of several significant telematics products customers
to multi-year subscription contracts in the fleet market. We expect to recognize approximately 47% of our remaining
contractual performance obligations in fiscal 2023.

Total backlog for our telematics devices as of February 28, 2022 and February 28, 2021 was $83 million and
$66 million, respectively. Substantially all of the backlog at February 28, 2022 is expected to be shipped in fiscal
2023. Our backlog for telematics devices increased year-over-year as we experienced significant supply shortages
which were primarily attributable to global supply imbalances caused by the lingering impact of the COVID-19
pandemic. As we drive toward a SaaS business model, we expect that a significant portion of the February 28, 2022
telematics devices backlog will ultimately be bundled and fulfilled in connection with multi-year subscription
contracts.

Intellectual Property

Intellectual property is an important aspect of our business, and we seek protection for our intellectual property
as appropriate. We rely upon a combination of patent, trade secret, and trademark laws and contractual restrictions,

such as confidentiality agreements and licenses, to establish and protect our proprietary rights. In addition, we often
rely on inbound licenses of intellectual property for use in our business.

We own and utilize the tradename “CalAmp” as well as the related logos and trademarks on many of our
products and solutions. We believe that having distinctive marks that are registered and readily identifiable is an
important factor in identifying our brand. We own over 200 active trademark applications and registrations throughout
the world, with approximately 30 pending and registered trademarks in the U.S.

In addition to the foregoing protections, we generally control access to and the use of our proprietary and other
confidential information through the use of internal and external controls, including contractual protections with
employees, manufacturers, and others. We will continue to file and prosecute patent applications when appropriate to
protect our rights in our proprietary technologies.

As of February 28, 2022, we had nearly 300 patents worldwide. In addition to our awarded patents, we have
approximately 70 patent applications in process. Although a number of these trademarks, and patents relate to software
and products that are significant to our business and operations, we do not believe we are dependent on a single
trademark, copyright or patent.

Governmental Regulation

We are subject to a variety of U.S. and foreign laws and regulations in connection with our operations, including
those governing discharges of pollutants into the air and water, the management and disposal of hazardous substances
and the clean-up of contaminated sites, and close oversight of our products’ material compliance including adherence
to relevant EPA regulations under the Toxic Substances Control Act. While we believe that we are currently in material
compliance with these regulatory requirements, the requirements may change or new requirements may be imposed
that could require significant unanticipated expenditures by us.

We have established environmental management systems and continually update our environmental policies
and standard operating procedures for our operations worldwide. We believe that our operations are in material
compliance with applicable environmental laws, regulations and permits. We budget for operating and capital costs
on an ongoing basis to comply with environmental laws.

Corporate Responsibility and Sustainability

We believe responsible and sustainable business practices support our long-term success. As a company, we are
deeply committed to protecting and supporting our people, our environment, and our communities. That commitment
is reflected through various corporate initiatives as well as day-to-day activities,
including our adoption of
sustainability-focused policies and procedures, our publicly recognized focus on fostering an inclusive workplace, our
constant drive toward more efficient use of materials and energy, our careful and active management of our supply
chain, our services and products which help reduce carbon footprints and enhance road safety, and our impactful,
globally integrated ethics and compliance program.

•

We seek to protect the human rights and civil liberties of our employees and the employees of our contract
manufacturers through policies, procedures, and programs aimed at avoiding risks of compulsory and
child labor, both within our company and throughout our supply chain.

We foster a workplace of dignity, respect, diversity, and inclusion through our recruiting and advancement
practices, internal communications, and employee resource groups.

We educate our employees annually on relevant ethics and compliance topics, publish accessible guidance
on ethical issues and related company resources in our global Code of Business Conduct and Ethics, and
encourage reporting of ethical concerns through any one of several global and local reporting channels.

We innovate to reduce the energy used by our products, the energy used to manufacture them, and the
amount of new materials required to manufacture them.

Human Capital

People are our greatest asset and we are committed to being an employer of choice in our industry. We proudly

offer the security of a large publicly traded tech company without the rigidity and red tape.

CalAmp offers an engaging and diverse work environment where people take pride in their contributions and
share in the company’s success. We empower our employees to showcase their talent, sharpen their skills, develop
new professional and leadership capabilities while being part of a global
team that develops revolutionary
technologies.

CalAmp continually strives to be a deeply inclusive employer with diversity reflected in our teams. We
encourage employees to be truly themselves and thrive in an environment where their voices matter, differences are
understood and valued, and where they are supported to express their unique ideas openly. We aim to foster a highly
engaged and energized workplace, where everyone is treated with dignity and respect and is excited to achieve more.

Our employees engage in meaningful work with access to cutting-edge tools and technologies to develop

solutions that disrupt entire industries.

CalAmp’s strategic leadership comes from a solid base of worldwide experience in technology, from connected
vehicles to networking to public safety to energy and beyond. The executive team has years of expertise in both
start-up and enterprise environments designing software and hardware for a wide variety of applications.

Our company culture is driven by four core values:

•

Customer Success – we seek to achieve total customer satisfaction by understanding what the customer
wants and delivering it flawlessly. We communicate and collaborate effectively with others for the benefit
of the customer. Satisfied customers are essential to our success.

Innovation – we do not accept the status quo. We are committed to transforming ideas into new and
improved solutions and processes. We respond resourcefully to demands and challenges in order to
advance, compete and differentiate ourselves successfully in the marketplace and bring value to our
customers.

Execution – we make and meet our commitments. We deliver results in tight timeframes. Our can-do
attitude supports us in overcoming obstacles with solutions, and we are accountable when errors are made.
We learn from mistakes and move forward.

Inclusion – we believe in the integrity, honesty and trust of our employees, and we value their diversity
of thought and opinion. We embrace collaboration by listening to the opinions of others, valuing their
differences and speaking in a positive, respectful manner. We take personal responsibility for our actions
and are committed to building diverse teams with fairness and respect for all.

As of February 28, 2022, we had 887 employees. From time to time we also hire contracted workers that are
generally engaged through independent temporary labor agencies. None of our employees or contract workers are
represented by a labor union.

Recent Developments

COVID-19 and Global Supply Imbalances

In March 2020, the World Health Organization declared COVID-19 (“COVID-19” or the “pandemic”) to be a
public health pandemic of international concern, which has resulted in travel restrictions and in some cases,
prohibitions of non-essential activities, disruption and shutdown of businesses and greater uncertainty in global
financial markets. The pandemic continues to have widespread and unpredictable impact on global economies,
financial markets, and business practices, and continues to impact our business operations, including our employees,
customers and suppliers. During fiscal 2021, our revenues were negatively impacted by COVID-19 as various small-
to-medium sized customers postponed expenditures due to the pandemic and related macro-economic uncertainties.
During fiscal 2022, we experienced supply shortages as a result of global supply imbalances initially driven by the
global pandemic. These global supply imbalances have negatively impacted all parts of our business and operations
during fiscal 2022, both in the form of reduced availability of devices as well as increased costs to procure available
devices. It is difficult to predict the extent to which the pandemic will continue to impact our future business or

operating results, which are highly dependent on uncertain future developments, including actions taken or to be taken
by governments and private businesses in relation to its containment and the resolution of supply chain issues and
supply shortages. Because our business is dependent on telematics product fulfillment, device installations and related
subscription-based services, the ultimate effect of COVID-19 and the current supply shortages may not be fully
reflected in our operating results until future periods.

AVAILABLE INFORMATION

Our primary Internet address is www.calamp.com. We make our U.S. Securities and Exchange Commission
(“SEC”) periodic reports (Forms 10-Q and Forms 10-K) and current reports (Forms 8-K) available free of charge
through our website as soon as reasonably practicable after they are filed electronically with the SEC. Within the
Investor Relations section of our website, we provide information concerning corporate governance, including our
Corporate Governance Guidelines, Board committee charters and composition, Code of Business Conduct and Ethics,
and other information. The content of our website is not incorporated by reference into this Annual Report on Form
10-K or into any other report or document we file with the SEC, and any references to our websites are intended to be
inactive textual references only.

Materials that we file with the SEC may be read and copied at the SEC's Public Reference Room at 100 F Street,
NE, Washington, D.C. 20549. Information on the operation of the Public Reference Room may be obtained by calling
the SEC at 1-800-SEC-0330. The SEC also maintains an internet website at http://www.sec.gov that contains reports,
proxy and information statements, and other information that we file electronically with the SEC.

ITEM 1A. RISK FACTORS

We operate in a rapidly changing environment that involves a number of risks and uncertainties, some of which
are beyond our control. The following list describes several risk factors that are applicable to our business and speaks
as of the date of this document. These and other risks could have a material adverse effect on our business, results of
operations, financial condition, and cash flows and the trading price of our common stock. The risks and uncertainties
described below are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we
currently believe are not material, may also become important factors that affect us.

Summary of Risk Factors

Our business is subject to a number of risks of which you should be aware before making a decision to invest
in our common stock. Among others, and including those described in this section “Item 1A. Risk Factors”, these
risks include:

• Our contract manufacturers and diversified supply chain, component shortages and uncertainty in
international trade relations with China may adversely impact us and have a material adverse effect on our
business, results of operations and financial condition.

•

The COVID-19 pandemic could have a material adverse impact on our business, results of operations and
financial condition.

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
may adversely affect our ability to bring products to market, damage our reputation and adversely affect
our results of operations.

Because we depend on a few significant customers for a substantial portion of our revenues and we
generally do not have long-term contracts with customers, the loss or significant decline or slowdown of
sales to these customers could have an adverse effect on our business, financial condition or results of
operations.

• Our operations are subject to the effects of a rising rate of inflation.

•

Because the markets in which we compete are highly competitive and some of our competitors have greater
resources than us, we cannot be certain that our products and services will continue to be accepted in the
marketplace or will maintain or capture increased market share.

• We have been subject to breaches of our information technology systems, and are at risk of future attacks,
which could damage our reputation, vendor and customer relationships, and our customers’ access to our
services.

•

The ongoing military action between Russia and Ukraine could adversely affect our business, financial
condition and results of operations.

If demand for our products and services fluctuates rapidly and unpredictably, it may be difficult to manage
our business efficiently, which may result in reduced gross margins and profitability.

If we do not meet product and services introduction deadlines or if we fail to predict carrier and end user
customer preferences among the many evolving wireless industry standards, our business could be
adversely affected.

• Any acquisitions we pursue could disrupt our business and harm our financial condition and results of

operations.

• Our global operations and continued international expansion expose us to risks and challenges associated

with conducting business internationally.

•

Some of our products are subject to mandatory regulatory approvals in the U.S. and other countries that
are subject to change, which could make compliance costly and unpredictable.

• Ongoing changes to U.S. tax, tariff and import/export regulations may have a negative effect on global

economic conditions, financial markets and our business.

• 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 rely on access to third-party patents and intellectual property, and our future results could be materially

and adversely affected if we are unable to secure such access in the future.

• 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.

• We may not have the ability to raise the funds necessary to settle conversions of the convertible notes in
cash, repay the convertible notes at maturity or repurchase the convertible notes upon a fundamental
change, and our future debt may contain limitations on our ability to pay cash upon conversion or
repurchase of the convertible notes.

•

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.

Risks Related to Our Business Operations and Financial Condition

Our contract manufacturers and diversified supply chain, component shortages and uncertainty in international
trade relations with China may adversely impact us and have a material adverse effect on our business, results of
operations and financial condition.

We accelerated our supply chain diversification program to transition our manufacturing to tier one global
contract manufacturers with facilities outside of China. This program was initiated against the backdrop of the
escalation of trade tensions between the U.S. and China. This transition contributed to various supply disruptions,
including component shortages, beginning in the third and fourth quarter of fiscal 2020. Additionally, during fiscal
2022, we experienced supply shortages as a result of global supply imbalances initially driven by the global pandemic,
which have negatively impacted all parts of our business. Although we are taking steps to address these matters, the
related operational challenges and supply chain disruptions may persist for some time.

The COVID-19 pandemic could have a material adverse impact on our business, results of operations and financial
condition.

In March 2020, the World Health Organization declared COVID-19 a pandemic. The outbreak has spread
globally, resulting in the implementation of significant governmental measures, including lockdowns, closures,

quarantines and travel bans, each intended to control the spread of the virus. The COVID-19 pandemic has caused
severe global disruptions which have created significant volatility, uncertainty and economic disruption.

Uncertainties regarding the economic impact of COVID-19 are likely to result in sustained market turmoil,
which could also negatively impact our business, financial condition and cash flows. This pandemic could negatively
affect our ability to sell-through our backlog. Our ability to manage normal commercial relationships with our
suppliers, contract manufacturers, and customers may suffer. Our customers could shift purchases to lower-priced or
other perceived value offerings during the pandemic-caused economic downturn as a result of various factors,
including workforce reductions, reduced access to credit, and changes in federal economic policy. In particular,
customers may become more conservative in response to these conditions and seek to reduce their purchases and
inventories. Our results of operations depend upon, among other things, our ability to maintain and increase sales
volume with our existing customers, our ability to attract new customers, and the financial condition of our customers.
Decreases in demand for our products and solutions without a corresponding decrease in costs would put downward
pressure on our margins and would negatively impact our financial results.

Governmental organizations, such as the U.S. Centers for Disease Control and Prevention and state and local
including event

governments, have recommended and/or imposed increased community-based interventions,
cancellations, social distancing measures, and restrictions on gatherings.

Through fiscal 2021, our revenues were negatively impacted by COVID-19 as various small-to-medium
customers postponed their capital expenditure due to the pandemic and related macro-economic uncertainties.
Although our business was initially negatively impacted by the COVID-19 pandemic in the first half of fiscal 2021,
we resumed device installation and activation services soon thereafter. We have experienced supply shortages as a
result of global supply imbalances driven by the global pandemic. These global supply imbalances have negatively
impacted all parts of our business during fiscal 2022. It is difficult to predict the extent to which the pandemic will
continue to impact our future business or operating results, which are highly dependent on uncertain future
developments, including the severity of the continuing pandemic, the actions taken or to be taken by governments and
private businesses in relation to its containment and the resolution of supply chain issues and supply shortages.
Because our business is dependent on telematics product sales, device installations and related subscription-based
services, the ultimate effect of COVID-19 and the current supply shortages may not be fully reflected in our operating
results until future periods.

To the extent that COVID-19 adversely affects our business, results of operations, financial condition and cash

flows, it may also heighten many of the risk factors described in this “Risk Factors” section.

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 may
adversely affect our ability to bring products to market, damage our reputation and adversely affect our results of
operations.

We operate an outsourced manufacturing business model that utilizes contract manufacturers. We depend on a
limited number of contract manufacturers to allocate sufficient manufacturing capacity to meet our needs, to produce
products of acceptable quality at acceptable yields, and to deliver those products to us on a timely basis. Some of our
key components are complex to manufacture and have long lead times. In the event of a reduction or interruption of
supply, or degradation in quality, it could take up to six months to begin receiving adequate supplies from alternative
suppliers, if any. As a result, product shipments could be delayed and revenues and profitability could suffer. Instances
of continued supply chain disruptions and delays, as well as continued heightened inflation, could lead to inefficiencies
and increased costs that could negatively impact our performance and our results of operations. In such circumstances,
we may be unable to meet our customer demand and may fail to meet our contractual obligations. This could result in
the payment of significant damages by us to our customers, a decline in net revenue and a loss of market share as our
customers could choose to purchase competing products and services, all of which could adversely affect our business,
financial condition and results of operations. Any substantial disruption in our contract manufacturers’ supply as a
result of a pandemic, natural disaster, trade wars, political unrest, economic instability, equipment failure, component
shortage or other cause, could materially harm our business, customer relationships and results of operations.

Because we depend on a few significant customers for a substantial portion of our revenues and we generally do
not have long-term contracts with customers, the loss of or significant decline or slowdown of sales to these
customers could have an adverse effect on our business, financial condition or results of operations.

Our revenues depend on a small number of significant customers and some of them represented more than 10%
of our total revenues in fiscal year 2022, 2021 and 2020 (see Note 4 to our consolidated financial statements). They
are also expected to represent a substantial portion of our revenues in the near future. As a result, the loss of any one
of these customers, or a decline or slowdown in purchases from any of these customers, could have a material adverse
effect on our business, financial condition and results of operations. In addition, because service revenue depends
either partially or entirely on the usage levels of data transmission by our customers and end users, the decline or
slowdown in the growth of usage patterns of these customers, which has and could continue to occur at any time and
with or without a reduction in the number of our subscriber base could have a material adverse effect on our business,
financial condition and results of operations. We generally do not have long-term contracts with our customers. As a
result, our agreements with our customers generally do not provide us with any assurance of future sales. These
customers can cease purchasing products and services from us at any time without penalty, are free to purchase
products and services from our competitors, may expose us to competitive price pressure on each order and are not
required to make minimum purchases. Any of these actions taken by our customers could have a material adverse
effect on our business, financial condition or results of operations.

Our operations are subject to the effects of a rising rate of inflation.

The United States has recently experienced historically high levels of inflation. According to the U.S.
Department of Labor, the annual inflation rate for the United States was approximately 7.0% for the 12 months ended
December 31, 2021. If the inflation rate continues to increase, such as increases in the costs of labor and supplies, it
will affect our expenses. Additionally, the United States is experiencing an acute workforce shortage, which in turn,
has created a hyper-competitive wage environment that may increase our operating costs. To the extent inflation results
in rising interest rates and has other adverse effects on the market, it may adversely affect our consolidated financial
condition and results of operations.

The markets for our products and services are intensely competitive and characterized by rapid technological
change, evolving standards, short product life cycles, and price erosion. Given the highly competitive environment in
which we operate, we cannot be sure that any competitive advantages currently enjoyed by our products and services
will be sufficient to establish and sustain our products and services in the markets we serve. Any increase in price or
other competition could result in erosion of our market share, to the extent we have obtained market share, and could
have a negative impact on our financial condition and results of operations. We cannot provide assurance that we will
have the financial resources, technical expertise or marketing and support capabilities to compete successfully. We
expect competition to intensify in the future with the introduction of new technologies and market entrants and with
the possible consolidation of competitors.

Information about our competitors is included in Part I, Item 1 of this Annual Report on Form 10-K under the

heading “COMPETITION”.

If demand for our products and services fluctuates rapidly and unpredictably, it may be difficult to manage our
business efficiently, which may result in reduced gross margins and profitability.

Our cost structure is based in part on our expectations for future demand. Many costs, particularly those relating
to capital equipment and manufacturing overhead, are largely fixed. Rapid and unpredictable shifts in demand for our
products and services may make it difficult to plan production capacity and business operations efficiently. If demand
is significantly below expectations, we may be unable to rapidly reduce these fixed costs, which can diminish gross
margins and cause losses. A sudden downturn may also leave us with excess inventory, which may be rendered
obsolete if products and services evolve during the downturn and demand shifts to newer products and services. Our
ability to reduce costs and expenses may be further constrained because we must continue to invest in research and
development to maintain our competitive position and to maintain service and support for our existing customer base.
Conversely, in the event of a sudden upturn, we may incur significant costs to rapidly expedite delivery of components,
procure scarce components and outsource additional manufacturing processes. These costs could reduce our gross
margins and overall profitability. Any of these results could adversely affect our business, financial condition or results
of operations.

We may be unable to successfully implement a disposition or wind-down of certain business activities that no longer
fit our strategic plan.

Effective March 15, 2021, we sold certain assets and transferred certain liabilities related to our LoJack North
America business. We may engage in future dispositions or wind-downs of certain businesses. Key risks associated
with exiting a business include:

•

our ability to price a sale transaction appropriately and otherwise negotiate acceptable terms;

our ability to identify and implement key customer, technology systems, and other transition actions to
avoid or minimize negative effects on retained business activities;

our ability to assess and manage any loss of synergies that the exited business activity had with our
retained business activities;

our ability to replace legacy earnings from the exited business or activity with new revenues; and

our ability to manage capital, liquidity, and other challenges that may arise if an exit results in significant
legacy cash expenditures or financial loss.

Any acquisitions we pursue could disrupt our business and harm our financial condition and results of operations.

As part of our business strategy, we continually review acquisition opportunities that we believe would be
advantageous or complementary to the development of our business. In the first quarter of fiscal year 2020, we
acquired LoJack Mexico and Synovia, and we may acquire additional businesses, assets, or technologies in the future.
If we make any acquisitions, we could take any or all of the following actions, any one of which could adversely affect
our business, financial condition, results of operations or share price:

•

use a substantial portion of our available cash;

require a significant devotion of management’s time and resources in the pursuit or consummation of any
acquisition;

incur substantial debt, which may not be available to us on favorable terms and may adversely affect our
liquidity;

issue equity or equity-based securities that would dilute existing stockholders’ ownership percentage;

assume contingent liabilities; and

take substantial charges in connection with acquired assets.

Acquisitions also entail numerous other risks, including, without limitation: difficulties in assimilating acquired
operations, products, technologies and personnel; unanticipated costs; diversion of management’s attention from
existing operations; risks of entering markets in which we have limited or no prior experience; potential loss of key
employees from either our existing business or the acquired organization; and a negative effect on our existing
relationships with suppliers and customers. Acquisitions may result in substantial accounting charges for restructuring
and other expenses, amortization of purchased technology and intangible assets and stock-based compensation
expense, any of which could materially and adversely affect our operating results. We may not be able to realize the
anticipated benefits of or successfully integrate with our existing business the businesses, products, technologies or
personnel that we acquire, and our failure to do so could harm our business and operating results. Our industry is being
affected by the trend toward consolidation and the creation of strategic relationships. If we are unable to successfully
adapt to this rapidly changing environment, we could suffer a reduction in the volume of business with our customers
and suppliers, or we could lose customers or suppliers entirely, which could materially and adversely affect our
financial condition and operating results.

We have been subject to breaches of our information technology systems, which could damage our reputation,
vendor, and customer relationships, and our customers’ access to our services.

Our presence in the Internet of Things (“IoT”) industry with offerings of telematics products and services,
including vehicle telematics, could also increase our exposure to potential costs and expenses and reputational harm
in the event of cyber-attacks impacting these products or services. Our business operations require that we use and
store sensitive data, including intellectual property, proprietary business information and personally identifiable
information, in our secure data centers and on our networks. We face a number of threats to our data centers and
networks in the form of unauthorized access, security breaches and other system disruptions. It is critical to our
business strategy that our infrastructure remains secure and is perceived by customers and partners to be secure.
Despite our security measures, our information technology systems have been and will continue to be vulnerable to
attacks by hackers or other disruptive problems.

We experience cyber-attacks and other security incidents of varying degrees from time to time, and we incur
significant costs in protecting against or remediating such incidents. For example, we detected and interrupted a
ransomware attack on a portion of our network in February 2021, which led to the theft of company data and
notifications to affected third parties, and we experienced a second attempt to hack our network in March 2021. In
response, we retained outside experts to advise on the incidents and to make recommendations for security
improvements. While we have not experienced any material loss or expense relating to these cyber-attacks or other
information security breaches, there can be no assurance that we will not suffer additional attacks or incur more serious
financial consequences or expense in the future.

In addition, we are subject to a variety of laws and regulations in the United States and abroad relating to
cybersecurity and data protection. As a result, affected users or government authorities could initiate legal or
regulatory actions against us in connection with any actual or perceived security breaches or improper access to or
disclosure of data, which has occurred in the past and which could cause us to incur significant expense and liability
or result in orders or consent decrees forcing us to modify our business practices.

Any security breach may compromise information used or stored on our networks and may result in significant
data losses or theft of our customers’ or our business partners’ intellectual property, proprietary business information
or personally identifiable information. A cybersecurity breach could negatively affect our reputation by adversely
affecting the market’s perception of the security or reliability of our products or services. In addition, a cyber-attack
could result in other negative consequences, including remediation costs, disruption of internal operations, increased
cybersecurity protection costs, lost revenues or litigation, which could have a material adverse effect on our business,
results of operations and financial condition.

Repurposing of satellite spectrum by adjacent operators of L-band spectrum for terrestrial services could interfere
with our GPS IoT products and services.

In 2011, the U.S. Federal Communications Commission (“FCC”) granted Ligado Networks (then known as
Lightsquared) (“Ligado”) a waiver to convert its L-band satellite spectrum to terrestrial use, including a 10 MHz band
close to the spectrum that we use for all of our Global Positioning System (“GPS”) products and services. That waiver
was subsequently suspended in 2012 due to concerns about potential interference to GPS operations. Ligado sought
another waiver in 2015, that it then amended in 2018, to modify its L-band mobile satellite service network with a

terrestrial-only proposal designed to address GPS industry-wide concerns. In April 2020, the FCC granted Ligado’s
waiver request. We oppose this waiver grant out of concern for the interference that we believe Ligado’s proposed
operations would cause to our IoT GPS devices. Ligado’s operations pursuant to the waiver would result in terrestrial
use of L-band spectrum, and such operations may interfere with, and harmfully affect, the performance of the Global
Navigation Satellite System (“GNSS”) receivers in our IoT GPS devices that operate in the 1559-1610MHz band,
which is adjacent to, and within range of, the L-band downlink allocation for GPS operations. Ligado’s L-band
terrestrial operations could impact our operations and impose costs on us to retrofit or replace affected GNSS receivers,
which could have a material adverse effect on our business, results of operations, and financial condition.

Our business is subject to many factors that could cause our quarterly or annual operating results to fluctuate and
our stock price to be volatile.

Our quarterly and annual operating results have fluctuated in the past and may fluctuate significantly in the
future due to a variety of factors, many of which are outside of our control. A majority of our product orders are
shipped in the final month of the quarter and a significant amount in the last two weeks of the quarter. Some of the
other factors that could affect our quarterly or annual operating results include:

•

the timing and amount, or cancellation or rescheduling, of orders for our products or services;

our ability to develop, introduce, ship and support new products, services and enhancements, and manage
product and services transitions;

announcements of new product and service introductions and reductions in the price of products and
services offered by our competitors;

fluctuations in the cost of telematics devices due to supply shortages or other market factors;

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 and services 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

changes in telecommunications and wireless market conditions specifically and economic conditions
generally, including as a result of a pandemic or other catastrophic event.

Due in part to factors such as the timing of product release dates, purchase orders and product availability,
significant volume shipments of products could occur close to the end of a fiscal quarter. Failure to ship products by
the end of a quarter may adversely affect operating results in such quarter. In the future, our customers may delay
delivery schedules or cancel their orders without notice. Due to these and other factors, our quarterly revenue, expenses
and results of operations could vary significantly in the future, and period-to-period comparisons should not be relied
upon as indications of future performance.

If we do not meet product and services introduction deadlines or if we fail to predict carrier and end user customer
preferences among the many evolving wireless industry standards, our business could be adversely affected.

In the past, we have experienced design and manufacturing difficulties that have delayed the development,
introduction or marketing of new products, services and enhancements and which caused us to incur unexpected
expenses and lost revenue. In addition, some of our existing customers have conditioned their future purchases of our
products and services on the addition of new features. In the past, we have experienced delays in introducing some
new product features. Furthermore, in order to compete in some markets, we will have to develop different versions
of existing products and services that comply with diverse, new or varying governmental regulations and evolving
wireless industry standards in each market. In our industry, it is critical to our success that we accurately anticipate
evolving wireless technology standards and that our products and services comply with these standards in relevant
respects. We are currently focused on engineering and manufacturing products and services that comply with several
different wireless standards. Any failure of our products and services to comply with any one of these or future

applicable standards could prevent or delay their introduction and require costly and time-consuming engineering
changes. Additionally, if an insufficient number of wireless operators or subscribers adopt the standards to which we
engineer our products and services, then sales of our new products and services designed to those standards could be
materially harmed. Our inability to develop new products, services, product features on a timely basis, or the failure
of new products, services or features to align with evolving wireless standards and achieve market acceptance, could
adversely affect our business.

Disruptions in global credit and financial markets could materially and adversely affect our business and results
of operations.

There is significant uncertainty about the stability of global credit and financial markets. Credit market
dislocations could cause interest rates and the cost of borrowing to rise or reduce the availability of credit, which could
negatively affect customer demand for our products and services if they responded to such credit market dislocations
by suspending, delaying or reducing their capital expenditures. Moreover, since we currently generate more than 25%
of our revenues outside the U.S., fluctuations in foreign currency exchange rates can have an impact on demand for
our products and services for which the sales are generally denominated in U.S. dollars.

We may be subject to product liability, warranty and recall claims that may increase the costs of doing business
and adversely affect our business, financial condition and results of operations.

We are subject to a risk of product liability or warranty claims if our products or services actually or allegedly
fail to perform as expected or the use of our products or services results, or is alleged to result, in bodily injury and/or
property damage. While we maintain what we believe to be reasonable limits of insurance coverage to appropriately
respond to such liability exposures, large product liability claims, if made, could exceed our insurance coverage limits
and insurance may not continue to be available on commercially acceptable terms, if at all. There can be no assurance
that we will not incur significant costs to defend these claims or that we will not experience any product liability losses
in the future. In addition, if any of our designed products are, or are alleged to be, defective, we may be required to
participate in recalls and exchanges of such products. The future cost associated with providing product and service
warranties and/or bearing the cost of repair or replacement of our products, including those that enable our service
offerings, could exceed our historical experience and have a material adverse effect on our business, financial
condition and results of operations.

Our inability to identify the origin of conflict minerals in our products could have a material adverse effect on our
business.

Many of our product lines include tantalum, tungsten, tin, gold and other materials that are considered to be
“conflict minerals” under the SEC’s rules. Those rules require public reporting companies to provide disclosure
regarding the use of conflict minerals sourced from the Democratic Republic of the Congo and adjoining countries in
the manufacture of products. Those rules, or similar rules that may be adopted in other jurisdictions, could adversely
affect our costs, the availability of minerals used in our products and our relationships with customers and suppliers.

We may experience significant disruptions in our operations resulting from our enterprise resource planning
system initiatives.

We depend on our information technology systems for the efficient functioning of our global business, including
accounting, billing, data storage, purchasing and inventory management. In order to integrate and enhance our global
operations, we initiated the phased implementation of an enterprise resource planning (“ERP”) system across our
global operating locations to support our operations. The implementation of this ERP system required, and will
continue to require, the investment of human and financial resources. We have incurred, and expect to incur, additional
expenses as we continue to implement, enhance and develop our ERP system. As a result of our ERP initiatives, we
may encounter difficulties in operating our business, which could disrupt our operations, including our ability to timely
ship and track customer orders, determine inventory requirements, manage our supply chain, manage customer billing
and adequately service our customers. If we experience significant disruptions resulting from our ERP initiatives, our
business and operations could be disrupted, including our ability to report accurate and timely financial results.
Accordingly, such events may disrupt or reduce the efficiency of our global operations and have a material adverse
effect on our operating results and cash flows.

Because we currently sell, and we intend to grow the sales of, certain of our products and services in countries
other than the U.S., we are subject to different regulatory regimes. We may not be able to develop products and
services that comply with the standards of different countries, which could result in our inability to sell our products
and services 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 services and which could adversely affect our business.

If our sales are to grow in the longer term, we believe we must grow our international business. Many countries
require communications equipment used in their country to comply with unique regulations, including safety
regulations, radio frequency allocation schemes and standards. If we cannot develop products that work with different
standards, we will be unable to sell our products and services in those locations. If compliance proves to be more
expensive or time consuming than we anticipate, our business would be adversely affected. Some countries have not
completed their radio frequency allocation process, and therefore, we do not know the standards with which we would
be required to comply. Furthermore, standards and regulatory requirements are subject to change. If we fail to
anticipate or comply with these new standards, our business and results of operations will be adversely affected.

Sales to customers from continuing operations outside the U.S. accounted for 33%, 35% and 31% of our total
sales for fiscal years ended February 28/29, 2022, 2021 and 2020, respectively. Assuming that we continue to sell our
products and services to foreign customers, which is our expectation, we will be subject to the political, economic and
other conditions affecting countries or jurisdictions other than the U.S., including those in Latin America, Africa, the
Middle East, Europe and Asia. Any interruption or curtailment of trade between the countries in which we operate
and our present trading partners, changes in exchange rates, significant shift in U.S. trade policy toward these
countries, or significant downturn in the political, economic or financial condition of these countries, could cause
demand for and sales of our products and services to decrease, or subject us to increased regulation including future
import and export restrictions, any of which could adversely affect our business.

Additionally, a substantial portion of our products, components and subassemblies are currently procured from
foreign suppliers located primarily in Hong Kong, mainland China, Malaysia, Mexico and other Pacific Rim countries.
Any significant shift in U.S. trade policy toward these countries or a significant downturn in the political, economic
or financial condition of these countries could cause disruption of our supply chain or otherwise disrupt operations,
which could adversely affect our business.

Risks Related to Regulatory and Legal Matters

Our global operations and continued international expansion expose us to risks and challenges associated with
conducting business internationally.

We face several risks inherent in conducting business internationally, including compliance with international
and U.S. laws and regulations that apply to our international operations. These laws and regulations include data
privacy requirements, labor relations laws, tax laws, competition regulations, import and trade restrictions, economic
sanctions, export requirements, U.S. laws such as the Foreign Corrupt Practices Act, the UK Bribery Act 2010 and
other local laws that prohibit payments to governmental officials or certain payments or remunerations to customers.
Given the high level of complexity of these laws there is a risk that some provisions may be breached by us, for
example through fraudulent or negligent behavior of individual employees, our failure to comply with certain formal
documentation requirements, or otherwise. Violations of these laws and regulations could result in fines, criminal
sanctions against us, our officers or our employees, requirements to obtain export licenses, cessation of business
activities in sanctioned countries, implementation of compliance programs, or prohibitions on the conduct of our
business. Any such violations could include prohibitions on our ability to offer our products or services in one or more
countries and could materially damage our reputation, our brand, our international expansion efforts, our ability to
attract and retain employees, our business or operating results.

Global developments (including those related to the United Kingdom’s withdrawal from the European Union
or other similar global regulations), or the perception that additional developments could occur, have had and may
continue to have a material adverse effect on global economic conditions and financial markets, and may significantly
reduce global market liquidity, restrict the ability of key market participants to operate in certain financial markets or
restrict our access to capital. Given our recent efforts to expand our business throughout Europe, these developments
could affect our relationships with our existing and future customers, suppliers and employees. Any of these factors
could have a material adverse effect on our business, financial condition and results of operations.

Some of our products are subject to mandatory regulatory approvals in the U.S. and other countries that are subject
to change, which could make compliance costly and unpredictable.

Some of our products are subject to certain mandatory regulatory approvals in the U.S. and other countries in
which it operates. In the U.S., the FCC regulates many aspects of communication devices, including radiation of
electromagnetic energy, biological safety and rules for devices to be connected to the telecommunication networks.
Although we have obtained the required FCC and various country approvals for all products and services we currently
sell, there can be no assurance that such approvals can be obtained for future products and services on a timely basis,
or at all. In addition, such regulatory requirements may change or we may not in the future be able to obtain all
necessary approvals from countries other than the U.S. in which we currently sell our products and services or in
which we may sell our products and services in the future.

Ongoing changes to U.S. tax, tariff and import/export regulations may have a negative effect on global economic
conditions, financial markets and our business.

We import certain products and components from suppliers in China. In the past, the Office of the U.S. Trade
Representative enacted tariffs on imports into the U.S. from China, resulting in ongoing trade tensions. Although some
of the products and components we import are affected by the tariffs, at this time, we do not expect these tariffs to
have a material impact on our business, financial condition or results of operations. However, it is possible that further
tariffs may be imposed on imports of our products, or that our business will be impacted by retaliatory trade measures
taken by China or other countries in response to existing or future tariffs, causing us to raise prices or make changes
to our operations, any of which could have a negative impact on our revenue or operating results.

Evolving regulation and changes in applicable laws relating to data privacy and the Internet may increase our
expenditures related to compliance efforts or otherwise limit the solutions we can offer, which may harm our
business and adversely affect our financial condition.

As Internet commerce continues to evolve, increased regulation by federal, state or foreign agencies becomes
more likely. We are particularly sensitive to these risks because the Internet is a critical component of our SaaS
business model. In addition, taxation of services provided over the Internet or other charges imposed by government
agencies or by private organizations for accessing the Internet may be imposed. Any regulation imposing greater fees
for Internet use or restricting information exchange over the Internet could result in a decline in the use of the Internet
and the viability of Internet-based services, which could harm our business.

Our products and solutions enable us to collect, manage and store a wide range of data related to fleet
management such as vehicle location and fuel usage, speed and mileage and, in the case of our field service application,
customer information, job data, schedule, invoice and other information. A valuable component of our solutions is our
ability to analyze this data to present the user with actionable business intelligence. We obtain our data from a variety
of sources, including our customers and third-party providers. The U.S. and various state governments have adopted
or proposed limitations on the collection, distribution and use of personal information (including the California
Consumer Privacy Act of 2018). Several foreign jurisdictions, including the European Union and the United Kingdom,
have adopted legislation (including directives or regulations) that increase or change the requirements governing data
collection and storage in these jurisdictions. Proposed or new legislation and regulations could also significantly affect
our business. There currently are a number of proposals pending before federal, state, and foreign legislative and
regulatory bodies. In addition, the European Union General Data Protection Regulation (“GDPR”) took effect in May
2018. The GDPR includes operational requirements for companies that receive or process personal data of residents
of the European Union. For example, we may be required to obtain consent and/or offer new controls to existing and
new users in Europe before processing data. In addition, the GDPR includes significant penalties for non-compliance.

Violations of these laws, or allegations of such violations, could subject us to litigation, regulatory
investigations, cash and non-cash penalties for noncompliance, disrupt our operations,
involve significant
management distraction and result in a material adverse effect on our business, financial condition and results of
operations. Moreover, if future laws and regulations limit our customers’ ability to use and share this data, or our
ability to store, process and share data with our customers over the Internet, demand for our solutions could decrease,
our costs could increase, and our results of operations and financial condition could be harmed.

Risks Related to Our Intellectual Property

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.

Our ability to succeed in wireless data communications markets may depend, in large part, upon our intellectual
property for some of our wireless technologies. We currently rely primarily on patents, trademark and trade secret
laws, confidentiality procedures and contractual provisions to establish and protect our intellectual property. However,
these mechanisms provide us with only limited protection. We currently hold almost 300 patents worldwide. As part
of our confidentiality procedures, we enter into non-disclosure and invention assignment agreements with all
employees, including officers, managers and engineers. Despite these precautions, third parties could copy or
otherwise obtain and use our technology without authorization, or develop similar technology independently.
Furthermore, effective protection of intellectual property rights is unavailable or limited in some foreign countries.
The protection of our intellectual property rights may not provide us with any legal remedy should our competitors
independently develop similar technology, duplicate our products and services, or design around any intellectual
property rights we hold.

We rely on access to third-party patents and intellectual property, and our future results could be materially and
adversely affected if we are unable to secure such access in the future.

Many of our products and services are designed to include third-party intellectual property, and in the future,we
may need to seek or renew licenses relating to such intellectual property. Although we believe that, based on past
experience and industry practice, such licenses generally can be obtained on reasonable terms, there is no assurance
that the necessary licenses would be available on acceptable terms or at all. Some licenses we obtain may be
nonexclusive and, therefore, our competitors may have access to the same technology licensed to us. If we fail to
obtain a required license or are unable to design around a patent where we do not hold a license, we may be unable to
sell some of our hardware solutions and services, and there can be no assurance that we would be able to design and
incorporate alternative technologies, without a material adverse effect on our business, financial condition, and results
of operations.

Our competitors have or may obtain patents that could restrict our ability to offer our products, software and
services, or subject us to additional costs, which could impede our ability to offer our products, software and services
and otherwise adversely affect us. In addition, third parties may claim that we infringe their intellectual property
and proprietary rights and may prevent us from manufacturing and selling some of our products and services and
subject us to litigation over intellectual property rights or other commercial issues.

Several of our competitors have obtained and can be expected to obtain patents that cover products, software
and services directly or indirectly related to those offered by us. There can be no assurance that we are aware of all
existing patents held by our competitors or other third parties containing claims that may pose a risk of our
infringement on such claims by our products, software and services. In addition, patent applications in the U.S. may
be confidential until a patent is issued and, accordingly, we cannot evaluate the extent to which our hardware, software
and services solutions may infringe on future patent rights held by others.

Even with technology that we develop independently, a third party may claim that we are using inventions
claimed by their patents and may initiate litigation to stop us from engaging in our normal operations and activities,
such as engineering and development and the sale of any of our products, software and services. Furthermore, because
of rapid technological changes in the mobile resource management (“MRM”) and IoT marketplaces, current extensive
patent coverage, and the rapid issuance of new patents, it is possible that certain components of our products, software,
services, and business methods may unknowingly infringe the patents or other intellectual property rights of third
parties. From time to time, we have been notified that we may be infringing such rights.

In the highly competitive and technology-dependent telecommunications field in particular, litigation over
intellectual property rights is a significant business risk, and some third parties (referred to as non-practicing, or patent-
assertion, entities) are pursuing a litigation strategy with the goal of monetizing otherwise unutilized intellectual
property portfolios via licensing arrangements entered into under threat of continued litigation. These lawsuits relate
to the validity, enforceability, and infringement of patents or proprietary rights of third parties. We may have to defend
ourselves against allegations that we violated patents or proprietary rights of third parties.

Regardless of merit, responding to such litigation may be costly, unpredictable, time-consuming, and often
involves complex legal, scientific, and factual questions, and could divert the attention of our management and
technical personnel. In certain cases, we may consider the desirability of entering into such licensing agreements or
arrangements, although no assurance can be given that these licenses can be obtained on acceptable terms or at all or

that litigation will not occur. If we are found to be infringing any intellectual property rights, we could lose our right
to develop, manufacture, or market products and services, product and services launches could be delayed, or we could
be required to pay substantial monetary damages or royalties to license proprietary rights from third parties. If a
temporary or permanent injunction is granted by a court prohibiting us from marketing or selling certain products,
software and services, or a successful claim of infringement against us requires us to pay royalties to a third party, our
financial condition and operating results could be materially and adversely affected, regardless of whether we can
develop non-infringing technology.

Risks Related to Third Parties

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.

Our telematics products and software services depend upon Internet-based systems that are proprietary to our
business. These applications, which are hosted at independent data centers and are connected via access points to
cellular networks, are used by our customers and by us to configure and communicate with wireless devices for
purposes of determining location, speed or other conditions of vehicles and other mobile or fixed assets, and to deliver
configuration code or executable commands to the devices. If we do not have continued access to sufficient capacity
on reliable networks, we may be unable to deliver services and our sales could decrease. Our ability to grow and
achieve profitability partly depends on our ability to buy sufficient capacity on the networks of wireless carriers and
on the reliability and security of their systems. Some of our wireless services are delivered using airtime purchased
from third parties. We depend on these third parties to provide uninterrupted service free from errors or defects and
would not be able to satisfy our customers’ needs if such third parties failed to provide the required capacity or needed
level of service. If these Internet-based systems failed or were otherwise compromised in some way, it could adversely
affect the proper functioning of the wireless tracking and monitoring devices that we sell, and could result in damages
to us as a result of the temporary or permanent inability of our customers to wirelessly communicate with these devices.
In addition, our expenses would increase, and profitability could be materially and adversely affected if wireless
carriers were to significantly increase the prices of their services. Our existing agreements with the wireless carriers
generally have one- to three-year terms. Some of these wireless carriers are, or could become, our competitors.

We rely upon Amazon Web Services to operate certain aspects of our service, and any disruption of or interference
with our use of the Amazon Web Services operation would impact our operations and our business would be
materially and adversely impacted.

Amazon Web Services (“AWS”) provides a distributed computing infrastructure platform for business
operations, or what is commonly referred to as a “cloud” computing service. We have architected our software and
computer systems so as to utilize data processing, storage capabilities, and other services provided by AWS. Certain
of our SaaS platforms and applications are hosted by AWS. Given this, along with the fact that we cannot easily switch
our AWS operations to another cloud service provider, any disruption of or interference with our use of AWS would
impact our operations and our business would be materially and adversely impacted.

Risks Related to Our Convertible Notes and Indebtedness

We may not have the ability to raise the funds necessary to settle conversions of the convertible notes in cash, repay
the convertible notes at maturity or repurchase the convertible notes upon a fundamental change, and our future
debt may contain limitations on our ability to pay cash upon conversion or repurchase of the convertible notes.

We have $230.0 million aggregate principal amount of 2.00% convertible senior unsecured notes due in 2025

(“2025 Convertible Notes” or “Notes”) outstanding.

Holders of the 2025 Convertible Notes will have the right to require us to repurchase all or a portion of their
convertible notes upon the occurrence of a fundamental change at a repurchase price equal to 100% of the principal
amount of the convertible notes to be repurchased, plus accrued and unpaid interest, if any. The 2025 Convertible
Notes will be convertible into cash, shares of our common stock or a combination of cash and shares of common
stock, at our election, based on an initial conversion rate of 32.5256 shares of common stock per $1,000 principal
amount of the convertible notes, which is equivalent to an initial conversion price of $30.7450 per share of common
stock, subject to customary adjustments. Holders may convert their Notes at their option upon the occurrence of certain
events, as defined in the applicable indenture.

Upon conversion of the 2025 Convertible Notes, unless we elect to deliver solely shares of our common stock
to settle such conversion (other than paying cash in lieu of delivering any fractional share), we will be required to
make cash payments in respect of the Notes being converted. However, we may not have enough available cash or be
able to obtain financing at the time we are required to make repurchases of the Notes surrendered therefor or pay cash
with respect to the Notes being converted or at their maturity.

In addition, our ability to repurchase or to pay cash upon conversions or at maturity of the Notes may be limited
by law, regulatory authority or agreements governing our future indebtedness. Our failure to repurchase the Notes at
a time when the repurchase is required by the applicable indenture or to pay any cash payable on future conversions
of the Notes as required by the applicable indenture would constitute a default under the applicable indenture. A
fundamental change under such indenture or a default under the indenture could also lead to a default under agreements
governing our future indebtedness. If the repayment of the related indebtedness were to be accelerated after any
applicable notice or grace periods, we may not have sufficient funds to repay the indebtedness and repurchase the
Notes or make cash payments upon conversions thereof.

The conditional conversion feature of the Notes, if triggered, may adversely affect our financial condition and
operating results.

In the event the conditional conversion feature of the Notes is triggered, holders of the Notes will be entitled to
convert the Notes at any time during specified periods at their option. If one or more holders elect to convert their
Notes, unless we elect to satisfy our conversion obligation by delivering solely shares of our common stock (other
than paying cash in lieu of delivering any fractional share), we would be required to settle a portion or all of our
conversion obligation through the payment of cash, which could adversely affect our liquidity. In addition, even if
holders do not elect to convert their Notes, we could be required under applicable accounting rules to reclassify all or
a portion of the outstanding principal of the Notes as a current rather than long-term liability, which would result in a
material reduction of our net working capital.

The accounting method for convertible debt securities that may be settled in cash, such as the Notes, could have a
material adverse effect on our reported financial results.

Accounting Standards Codification Subtopic 470-20, Debt with Conversion and Other Options (“ASC 470-
20”), requires an entity to separately account for the liability and equity components of convertible debt instruments
(such as the Notes) that may be settled entirely or partially in cash upon conversion in a manner that reflects the
issuer’s non-convertible debt interest rate. Accordingly, the equity component of the Notes is required to be included
in the additional paid-in capital section of stockholders’ equity on our consolidated balance sheet, and the value of the
equity component is treated as original issue discount for purposes of accounting for the debt component of the Notes.
As a result, we are required to recognize a greater amount of non-cash interest expense in our consolidated income
statements in the current and future periods presented as a result of the amortization of the discounted carrying value
of the Notes to their principal amount over the term of the Notes. We report lower net income (or greater net losses)
in our consolidated financial results because ASC 470-20 requires interest to include both the current period’s
amortization of the original issue discount and the instrument’s non-convertible interest rate. This could adversely
affect our reported or future consolidated financial results, the trading price of our common stock and the trading price
of the Notes.

In addition, under certain circumstances, in calculating earnings per share, convertible debt instruments (such
as the 2025 Convertible Notes) that may be settled entirely or partly in cash are currently accounted for utilizing a
method in which the shares of common stock issuable upon conversion of the Notes, if any, are not included in the
calculation of diluted earnings per share except to the extent that the conversion value of the Notes exceeds their
principal amount. Under this method, diluted earnings per share is calculated as if the number of shares of common
stock that would be necessary to settle such excess, if we elected to settle such excess in shares, were issued. We
cannot be sure that the accounting standards in the future will continue to permit the use of this method. If we are
unable to use this method in accounting for the shares issuable upon conversion of the Notes, if any, then our diluted
consolidated earnings per share could be adversely affected.

In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20)
and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40), which removes certain separation
models for convertible debt instruments and convertible preferred stock that require the separation of a convertible
debt instrument into a debt component and an equity or derivative component. The standard is effective for interim

and annual periods beginning after December 15, 2021, with early adoption permitted. We expect the primary impacts
of this new standard will be to increase the carrying value of the 2025 Convertible Notes and reduce our reported
interest expense. In addition, we will be required to use the if-converted method for calculating diluted earnings per
share.

The capped call, convertible note hedge and warrant transactions may adversely affect the value of our Notes and
our common stock.

In connection with the sale of the 2025 Convertible Notes, we entered into privately negotiated capped call
transactions with option counterparties. The capped call transactions are expected generally to reduce the potential
dilution to our common stock upon any conversion of the Notes and/or offset any potential cash payments we are
required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or
offset subject to a cap. In connection with establishing any hedges of the capped call transactions, the option
counterparties or their respective affiliates may enter into various derivative transactions with respect to our common
stock and/or purchase shares of our common stock. This activity could increase (or reduce the size of any decrease in)
the market price of our common stock or the Notes at that time. In addition, the option counterparties and/or their
respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect
to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market
transactions prior to the maturity of the Notes (and are likely to do so during any observation period related to a
conversion of Notes). This activity could also cause or avoid an increase or a decrease in the market price of our
common stock or the Notes, which could affect investors’ ability to convert the Notes and, to the extent the activity
occurs following conversion or during any observation period related to a conversion of Notes, it could affect the
amount and value of the consideration that investors will receive upon conversion of the Notes.

The effect, if any, of these activities, including the direction or magnitude, on the market price of our common
stock will depend on a variety of factors, including market conditions, and cannot be ascertained at this time. Any of
these activities could, however, adversely affect the market price of our common stock and the trading price of the
Notes.

We are subject to counterparty risk with respect to the convertible note hedge transactions.

The option counterparties are financial institutions or affiliates of financial institutions, and we will be subject
to the risk that one or more option counterparties may default under the capped call and/or convertible note hedge
transactions. Our exposure to the credit risk of the option counterparties will not be secured by any collateral. If any
of the option counterparties becomes subject to insolvency proceedings, we will become an unsecured creditor in
those proceedings with a claim equal to our exposure at the time under those transactions. Our exposure will depend
on many factors but, generally, the increase in our exposure will be correlated to the increase in the market price of
our common stock and in the volatility of the market price of our common stock. In addition, upon a default by an
option counterparty, we may suffer adverse tax consequences and more dilution than we currently anticipate with
respect to our common stock. We can provide no assurances as to the financial stability or viability of any of the option
counterparties.

We are subject to risks associated with debt financing.

Our revolving credit facility contains, among other things, certain negative and affirmative covenants including
financial covenants that require us to maintain a minimum level of earnings before interest, income taxes, depreciation,
amortization and other non-cash charges (Adjusted EBITDA) to interest ratio, a minimum senior indebtedness ratio
and a total indebtedness coverage ratio, all measured on a quarterly basis. While we have not previously breached any
of the covenants contained in our credit agreement, at February 28, 2022 we were in violation of the total indebtedness
coverage ratio covenant. Our revolving credit facility was set to expire on March 30, 2022 but was extended to June
30, 2022 as we are presently in negotiations to enter into a new revolving credit facility. Although we intend to enter
into a replacement revolving credit facility, there can be no assurance that we will be able to obtain a credit facility
with similar terms or at all.

Additionally, our ability to comply with these covenants may be affected by events and conditions beyond our
control, including the COVID-19 pandemic. A breach of any of these covenants could result in a default under the
credit agreement and related credit documents, which could cause all of the outstanding indebtedness under our

revolving credit facility to become immediately due and payable. These covenants could also limit our ability to seek
capital through the incurrence of new indebtedness or, if we are unable to meet our obligations, require us to repay
any outstanding amounts with sources of capital we may otherwise use to fund our business.

We may incur substantially more debt or take other actions that could diminish our ability to make payments on
the 2025 Convertible Notes.

We and our subsidiaries may be able to incur substantial additional debt in the future, subject to the restrictions
contained in our future debt instruments, some of which may be secured debt. We are not restricted under the terms
of the indenture governing the Notes from incurring additional debt, securing existing or future debt, recapitalizing
our debt or taking a number of other actions that are not limited by the terms of the indentures governing the Notes
that could have the effect of diminishing our ability to make payments on the Notes when due.

Risks Related to Our Common Stock and the Securities Market

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.

As a publicly traded company, the trading price of our common stock has fluctuated significantly in the past.
The future trading price of our common stock may be volatile and could be subject to wide price fluctuations in
response to such factors, including:

•

actual or anticipated fluctuations in revenues or operating results;

the effects of the recent global COVID-19 pandemic;

acts of war or terrorism;

failure to meet securities analysts’ or investors’ expectations of performance;

changes in key management personnel;

announcements of technological innovations or new products by us or our 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; and

general economic conditions.

Future issuances of shares of our common stock could dilute the ownership interests of our stockholders.

Any issuance of equity securities could dilute the interests of our stockholders and could substantially decrease
the trading price of our common stock. We may issue equity securities in the future for a number of reasons, including
to finance our operations and business strategy (including in connection with acquisitions, strategic collaborations or
other transactions), to adjust our ratio of debt to equity, to satisfy our obligations upon the exercise of outstanding
options or for other reasons. In July 2018, we issued the Notes and, to the extent we issue common stock upon
conversion of the Notes, that conversion would dilute the ownership interests of our stockholders.

General Risk Factors

The ongoing military action between Russia and Ukraine could adversely affect our business, financial condition
and results of operations.

On February 24, 2022, Russian military forces launched a military action in Ukraine and sustained conflict and
disruption in the region is likely. Although the length, impact and outcome of the ongoing military conflict in Ukraine
is highly unpredictable, this conflict could lead to significant market and other disruptions, including significant
volatility in commodity prices and supply of energy resources, instability in financial markets, supply chain

interruptions, political and social instability, changes in consumer or purchaser preferences as well as increase in
cyberattacks and cyber and corporate espionage.

Russia’s recognition of two separatist republics in the Donetsk and Luhansk regions of Ukraine and subsequent
military action against Ukraine have led to an unprecedented expansion of sanction programs imposed by the United
States, the EU, the United Kingdom, Canada, Switzerland, Japan and other countries against Russia, Belarus, the
Crimea Region of Ukraine, the so-called Donetsk People’s Republic and the so-called Luhansk People’s Republic,
including, among others:

•

blocking sanctions against some of the largest state-owned and private Russian financial institutions (and
their subsequent removal from the Society for Worldwide Interbank Financial Telecommunication
(“SWIFT”) payment system) and certain Russian businesses, some of which have significant financial
and trade ties to the European Union;

blocking sanctions against Russian and Belarusian individuals, including the Russian President, other
politicians and those with government connections or involved in Russian military activities; and

blocking of Russia’s foreign currency reserves as well as expansion of sectoral sanctions and export and
trade restrictions, limitations on investments and access to capital markets and bans on various Russian
imports.

The situation is rapidly evolving as a result of the conflict in Ukraine, and the United States, the EU, the United
Kingdom and other countries may implement additional sanctions, export controls or other measures against Russia,
Belarus and other countries, regions, officials, individuals or industries in the respective territories. Such sanctions
and other measures, as well as the existing and potential further responses from Russia or other countries to such
sanctions, tensions and military actions, could adversely affect the global economy and financial markets and could
adversely affect our business, financial condition and results of operations.

We are actively monitoring the situation in Ukraine and assessing its impact on our business. To date we have
not experienced any material interruptions in our infrastructure, supplies, technology systems or networks needed to
support our operations. We have no way to predict the progress or outcome of the conflict in Ukraine or its impacts in
Ukraine, Russia or Belarus as the conflict, and any resulting government reactions, are rapidly developing and beyond
our control. The extent and duration of the military action, sanctions and resulting market disruptions could be
significant and could potentially have substantial impact on the global economy and our business for an unknown
period of time. Any of the abovementioned factors could affect our business, financial condition and results of
operations. Any such disruptions may also magnify the impact of other risks described in this Annual Report on Form
10-K.

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.

Section 203 of the Delaware General Corporation Law prohibits a Delaware corporation from engaging in any
business combination with any interested stockholder for a period of three years from the time the person became an
interested stockholder, unless specific conditions are met. In addition, we have in place various protections which
would make it difficult for a company or investor to buy our business without the approval of our Board of Directors,
including authorized but undesignated preferred stock and provisions requiring advance notice of board nominations
and other actions to be taken at stockholder meetings. All of the foregoing could hinder, delay or prevent a change in
control and could limit the price that investors might be willing to pay in the future for shares of our common stock.

Our amended and restated bylaws provide that the Court of Chancery of the State of Delaware and the federal
district courts of the United States of America will be the exclusive forums for substantially all disputes between us
and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes
with us or our directors, officers, or employees.

Our amended and restated bylaws provide that the Court of Chancery of the State of Delaware is the exclusive

forum for:

•

any derivative action or proceeding brought on our behalf;

•

any action asserting a claim of breach of a fiduciary duty owed by, or other wrongdoing by, any of our
directors, officers, employees or agents to us or our stockholders;

any action asserting a claim against us arising pursuant to any provision of the Delaware General
Corporation Law, our restated certificate of incorporation, or our amended and restated bylaws;

any action to interpret, apply, enforce or determine the validity of our restated certificate of incorporation
or our amended and restated bylaws; and

any action asserting a claim against us that is governed by the internal affairs doctrine;

provided, that with respect to any derivative action or proceeding brought on our behalf to enforce any liability
or duty created by the Securities Exchange Act of 1934 or the rules and regulations thereunder, the exclusive forum
will be the federal district courts of the United States of America. Our restated and amended bylaws further provide
that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint
asserting a cause of action arising under the Securities Act of 1933, as amended.

These exclusive forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it
finds favorable for disputes with us or our directors, officers, or other employees, which may discourage lawsuits
against us and our directors, officers and other employees.

If securities or industry analysts issue an adverse or misleading opinion regarding our business or publish

unfavorable research about our business, our stock price and trading volume could decline.

The trading market for our common stock depends in part on the research and reports that industry or securities
analysts publish about us or our business. If one or more of the analysts who cover us ceases coverage of our Company
or fails to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause
our stock price or trading volume to decline. Moreover, if any of the analysts who cover us downgrade our stock or
issue an adverse or misleading opinion regarding us, our business model or our stock performance, or if our operating
results fail to meet the expectations of the investor community, our stock price could decline.

Our success depends on the attraction and retention of senior management and technical personnel with relevant
expertise.

As a competitor in a highly technical market, we depend heavily upon the efforts of our existing senior
management and technical teams. The loss of the services of one or more members of these teams could slow product
and services development and commercialization objectives. Due to the specialized nature of our products and
services, we also depend upon our ability to attract and retain qualified technical personnel with substantial industry
knowledge and expertise. Competition for qualified personnel is intense, and we may not be able to continue to attract
and retain qualified personnel necessary for the development of our business.

If we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial
statements could be impaired, which could harm our operating results, our ability to operate our business and
investors’ views of us.

We are subject to the rules and regulations of the SEC, including those rules and regulations mandated by the
Sarbanes-Oxley Act. Section 404 of the Sarbanes-Oxley Act requires public companies to include in their annual
report a statement of management’s responsibilities for establishing and maintaining adequate internal control over
financial reporting, together with an assessment of the effectiveness of those internal controls. Section 404 also
requires the independent auditors of certain public companies to attest to, and report on, this management assessment.
Ensuring that we have adequate internal financial and accounting controls and procedures in place so that we can
produce accurate financial statements on a timely basis is a costly and time-consuming effort that will need to be
evaluated frequently. Our failure to maintain the effectiveness of our internal controls in accordance with the
requirements of the Sarbanes-Oxley Act could have a material adverse effect on our business. We could lose investor
confidence in the accuracy and completeness of our financial reports, which could have an adverse effect on the price
of our common stock. In addition, if our efforts to comply with new or changed laws, regulations, and standards differ
from the activities intended by regulatory or governing bodies due to ambiguities related to practice, regulatory
authorities may initiate legal proceedings against us and our business may be harmed.

Lack of expected dividends may make our stock less attractive as an investment.

We intend to retain all future earnings for use in the development of our business. We do not anticipate paying
any cash dividends on our common stock in the foreseeable future. In certain cases, stocks that pay regular dividends
command higher market trading prices, and so our stock price may be lower as a result of our dividend policy.

We may be subject to legal proceedings that could adversely affect our business.

We may be subject to legal claims or regulatory matters involving stockholder, consumer, antitrust, intellectual
property infringement, product liability and other issues. Litigation is subject to inherent uncertainties, including
increases in demands for attention on our management team, and unfavorable rulings could occur. An unfavorable
ruling could include money damages. If an unfavorable ruling were to occur, it could have a material adverse effect
on our business, financial condition and results of operations for the period in which the ruling occurred or future
periods. See also “Item 3 – Legal Proceedings” in Part I of this Annual Report on Form 10-K.

Our stock price has been highly volatile in the past and could be highly volatile in the future.

The market price of our stock can be highly volatile due to the risks and uncertainties described in this Annual
Report, as well as other factors, including substantial volatility in quarterly revenues and earnings due to comments
by securities analysts and our failure to meet market expectations.

Over the fiscal year ended February 28, 2022, the price of our common stock as reported on The Nasdaq Global
Select Market ranged from a high of $14.51 to a low of $4.99. The stock market has from time to time experienced
extreme price and volume fluctuations that were unrelated to the operating performance of particular companies. In
the past, companies that have experienced volatility have sometimes subsequently become the subject of securities
class action litigation. If litigation were instituted on this basis, it could result in substantial costs and a diversion of
management’s attention and resources.

We may not be able to generate sufficient future taxable income to utilize our net operating loss and tax credit
carryforwards. In addition, our ability to utilize our federal net operating loss and tax credit carryforwards may be
limited under Sections 382 and 383 of the Internal Revenue Code (the “Code”).

As discussed in Note 14, as of February 28, 2022, we maintained a valuation allowance with respect to certain
of our deferred tax assets relating primarily to net operating losses and tax credits in U.S. and certain non-U.S.
jurisdictions that we believe are not likely to be realized. We considered positive and negative evidence, including
three years of cumulative losses considering forecasts of future profitability as of February 28, 2022, in assessing our
ability to realize our domestic net deferred tax assets.

Also, as of February 28, 2022, we had net operating loss carryforwards of approximately $75.3 million and
$68.3 million for federal and state tax purposes, respectively. The federal net operating loss (NOL) carryforwards are
subject to various limitations under Section 382 of the Internal Revenue Code. The ability to utilize our NOL
carryforwards to reduce taxable income in future years could become subject to significant limitations under Section
382 of the Internal Revenue Code if we undergo an ownership change.

The limitations apply if a corporation undergoes an “ownership change,” which is generally defined as a greater
than fifty (50) percentage point change (by value) in its equity ownership by stockholders who own directly or
indirectly, 5% or more of our common stock, over a three (3)-year period. Future changes in our stock ownership,
which may be outside of our control, may trigger an ownership change and, consequently, Section 382 and 383
limitations. Similar provisions of state tax law may also apply to limit our use of accumulated state tax attributes. As
a result, if we earn net taxable income, our ability to use our pre-change net operating loss carryforwards and other
tax attributes to offset such taxable income may be subject to limitations, which could potentially result in increased
future income tax liability to us. We continue to monitor stockholders who own directly or indirectly, 5% or more of
our common stock to determine if we have experienced an ownership change pursuant to Section 382.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2.

PROPERTIES

We are headquartered in Irvine, California with operations principally in the U.S., U.K., Italy and Mexico. We
conduct engineering as well as research and development activities at our facilities in the United States, while our
sales and administrative functions are performed in the U.S., U.K., Italy and Mexico. We periodically evaluate our
facility requirements as necessary and believe our existing and planned facilities are sufficient for our needs for at
least the next 12 months. All of our properties are leased facilities located in the following areas:

Location

Irvine, California
Richardson, Texas
Carlsbad, California
Eden Prairie, Minnesota

Square
Footage

Location

23,000 Guadalajara, Mexico
24,000 Mexico City, Mexico
29,000 Milan, Italy
7,000 Rome, Italy

London, U.K.

Square
Footage

3,000
17,000
10,000
2,000
6,000

We vacated our Indianapolis, Indiana facility as part of our plan to capture certain synergies and cost savings
related to streamlining our global operations effective at the end of fiscal 2021. This facility was used to support our
Synovia operations. This facility is sublet through February 2024.

ITEM 3.

LEGAL PROCEEDINGS

From time to time, various claims and litigation may be asserted or commenced against us arising from our
ordinary course of business. In particular, we may receive claims concerning contract performance, or claims that our
products or services infringe the intellectual property of third parties. Regardless of the outcome, litigation can have
an adverse impact on us because of deferred costs, diversion of management resources and other factors. See Note 19,
Commitments and Contingencies, of the Notes to the accompanying Consolidated Financial Statements below for
information regarding the legal proceedings in which we are involved.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER

MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our Common Stock trades on the Nasdaq Global Select Market under the ticker symbol CAMP. The following
graph and table compare our stock performance to three stock indices over a five-year period assuming $100
investment was made on the last day of fiscal year 2017:

300

250

200

150

100

2017
CalAmp Corp.

2018
NASDAQ Composite Index

2019

2020

2021

2022

NASDAQ Electronic Components

NASDAQ Telecommunications

Years Ended February
28/29,
CalAmp Corp.
Nasdaq Composite Index
Nasdaq Electronic
Components
Nasdaq Telecommunications

2017

2018

2019

2020

2021

2022

100
100

144
126

118
96

86
113

116
101

59
152

117
111

69
236

163
130

44
247

180
131

At April 21, 2022, we had approximately 1,200 stockholders of record. The number of stockholders of record
does not include the number of persons having beneficial ownership held in “street name” which are estimated to
approximate 14,000. We have never paid a cash dividend and have no current plans to pay cash dividends on our
Common Stock. In addition, our revolving credit facility prohibits payment of dividends without the prior written
consent of the lender under certain circumstances.

Securities Authorized for Issuance under Equity Compensation Plans

The information required by this Item will be included in our definitive proxy statement for the Annual Meeting

of Stockholders to be held on July 26, 2022 and is incorporated herein by this reference.

Issuer Purchases of Equity Securities

For the twelve months ended February 28, 2022, there have been no shares repurchased by the Company.

Recent Sales of Unregistered Equity Securities

The Company did not sell any unregistered equity securities during the twelve months ended February 28, 2022.

ITEM 6.

SELECTED FINANCIAL DATA

Not applicable.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

Overview

CalAmp Corp. (including its subsidiaries unless the context otherwise requires, “CalAmp”, “the Company”,
“we”, “our”, or “us”), incorporated in 1981 and re-incorporated in Delaware in 1987, is a connected intelligence
company that leverages a data-driven solutions ecosystem to help people and organizations improve operational
performance. We solve complex problems for customers within the market verticals of transportation and logistics,
commercial and government fleets, industrial equipment, government and consumer vehicles by providing solutions
that track, monitor and recover their vital assets. The data and insights enabled by CalAmp solutions provide real-time
visibility into a user’s vehicles, assets, drivers, and cargo, giving organizations greater understanding and control of
their operations. Ultimately,
these insights drive operational visibility, safety, efficiency, maintenance, and
sustainability for organizations around the world. Headquartered in Irvine, California, we have an installed base of
approximately 10 million devices reporting to our cloud-based platform and approximately 1.1 million software and
subscription services subscribers worldwide.

Reportable Segments

We operate under two reportable segments: Software & Subscription Services and Telematics Products.

Software & Subscription Services

Our Software & Subscription Services segment offers cloud-based application enablement and telematics
service platforms that facilitate integration of our own applications, as well as those of third parties, through open
APIs to deliver full-featured mobile IoT solutions to a wide range of customers and markets. Our scalable proprietary
applications and other subscription services enable rapid and cost-effective development of high-value solutions for
customers all around the globe. Services include tracking and monitoring services within Fleet Management as well
as Supply Chain Integrity and International Vehicle Location.

Telematics Products

Our Telematics Products segment offers a series of advanced telematics products for the broader connected
vehicle and emerging industrial IoT marketplace, which enable customers to optimize their operations by collecting,
monitoring and effectively reporting business-critical information and desired intelligence from high-value remote
and mobile assets. Our telematics products include asset tracking units, mobile telematics devices, fixed and mobile
wireless gateways, and routers. These wireless networking devices underpin a wide range of solutions, and are ideal
for applications demanding secure, reliable and business-critical communications. Products and sales channels include
OEM and MRM products.

Recent Developments

COVID-19

In March 2020, the World Health Organization declared COVID-19 to be a public health pandemic of
international concern, which has resulted in travel restrictions and in some cases, prohibitions of non-essential
activities, disruption and shutdown of businesses and greater uncertainty in global financial markets.

Since March 2020, our revenues have been negatively impacted by COVID-19 as various small-to-medium
sized customers postponed their capital expenditures due to the pandemic and related macro-economic uncertainties.

More recently we have experienced supply shortages as a result of global supply imbalances driven by the global
pandemic. These global supply imbalances have negatively impacted all parts of our business during fiscal 2022, both
in the form of reduced availability of components and devices as well as increased costs to procure available
components and devices. It is difficult to predict the extent to which these factors will continue to impact our future
business or operating results, which is highly dependent on uncertain future developments, including the severity of
the continuing pandemic, the actions taken or to be taken by governments and private businesses in relation to its
containment and resolution of supply chain issues and supply shortages. Because our business and operating results
depend on telematics product sales, device installations and related subscription-based services, the ultimate effect of
the pandemic and the current supply shortages may not be fully reflected in our operating results until future periods.

We have considered all known and reasonably available information that existed throughout the fiscal year
ended February 28, 2022, in making accounting judgements, estimates and disclosures. We are monitoring the
potential effects of the health care related and economic conditions of COVID-19 in assessing certain matters
including (but not limited to) supply chain disruptions and inflationary impacts, decreases in customer demand for our
products and services, potential longer-term effects on our customer and distribution channels particularly in the U.S.
and relevant end markets as well as other developments. If the impact results in longer term closures of businesses
and economic recessionary conditions, we may recognize material asset impairments and charges for uncollectible
accounts receivable in future periods.

Transition of MRM Telematics Customers to Subscription Arrangements

In the latter half of fiscal 2022, we prompted a strategic shift with customers who have historically purchased
MRM telematics devices from us. These customers are being transitioned to new arrangements by way of bundling
subscription services with telematics devices under multi-year (generally three years) subscription contracts. Our plan
is to transitition the entire base of MRM business to multi-year subscription contracts over the course of the next year.
As a result, our financial results associated with such subscription arrangements will be reported within our Software
& Subscription Services reporting segment prospectively from the effective date of such underlying contracts. In the
short term, we expect that this will lead to significant growth in our Software & Subscription Services business with
a corresponding decline in our Telematics Products business. Long term we believe this shift will allow us to drive
revenue growth as we generate incremental revenue from our existing customer base as well as new customers through
current and anticipated broader future subscription service offerings.

Sale of LoJack North America Operations

Effective March 15, 2021, we sold certain assets and transferred certain liabilities of the LoJack North America
business. Accordingly, the LoJack North America operations are presented as discontinued operations in the
accompanying consolidated financial statements for the years ended February 28/29, 2022, 2021, and 2020,
respectively.

Unless otherwise indicated, the financial disclosures and related information provided herein relate to our

continuing operations and we have recast prior period amounts to reflect discontinued operations.

Acquisitions

In March 2019, we acquired Car Track, S.A. de C.V. (“LoJack Mexico”) for a purchase price, net of cash on
hand, of approximately $12.7 million, which leverages our full stack of telematics and SaaS solutions to expand
product offerings to our substantial subscriber base in Mexico. LoJack Mexico was a customer in our Telematics
Products segment prior to the acquisition.

In April 2019, we acquired Synovia Solutions (“Synovia”), a North American market leader in fleet safety and
management for K-through-12 school bus and state and local government fleets for a purchase price, net of cash on
hand, of approximately $49.8 million. The Synovia acquisition expanded our fleet management and vehicle safety
services portfolio while accelerating our transformation to high-value subscription-based services.

Results of Operations and Financial Condition

Revenues

Revenues associated with our reportable segments are as follows:

Software & Subscription Services (“S&SS”). Our SaaS-based solutions provide our customers with the ability
to wirelessly communicate with monitoring devices installed in vehicles and other mobile or remote assets via our
cloud-based telematics platform and software applications. S&SS customer arrangements generally include a bundling
of subscription services combined with the sale or lease of telematics devices necessary to provide the associated
services. Depending upon the elements of a given contractual arrangement, it may contain one or multiple performance
obligations that are individually recognized as revenue over a subscription period or at a point in time based upon how
the performance obligation is fulfilled.

Telematics Products. Our products revenues consist primarily of sales of our telematics products or wireless
networking devices to large global companies as well as small and medium-sized enterprises. Revenues from our
products are reported net of sales returns and allowances, and incentives. The prices charged for telematics products
are determined through negotiation with our customers as well as prevailing market conditions and are fixed and
determinable upon shipment.

From time to time, we provide various professional services to customers including project management,
engineering services, and installation services. Revenues for professional services are typically distinct from other
performance obligations and are recognized as the related services are performed.

Cost of Revenues

Our cost of revenues for application subscriptions and other services includes personnel costs and related
benefits, consultants, software development activities, cellular network access costs, infrastructure costs for use of
private networking services, and other costs that are required to deliver these services to our customers. Our cost of
revenues for application subscriptions and other services also includes the cost of devices that are sold on an integrated
basis with applicable subscriptions. If the subscription services and associated telematics devices are determined to
represent a single combined performance obligation, the device costs are capitalized and are recognized ratably, on a
straight-line basis, over the estimated average in-service lives of these devices.

Our cost of revenues for telematics products represent the cost of finished goods sold to our customers and are
recognized at the point in time control passes to the customer. These costs include raw materials, manufacturing
overhead and labor costs, as well as customs and duties, license royalties, recycling fees, insurance and other costs
that are included in the price that we negotiate and pay to our contract manufacturers and component suppliers for the
products. The cost of revenues also includes charges related to excess and obsolete inventories and the cost of fulfilling
product warranties.

We continually negotiate to reduce the cost we pay to our suppliers in order to maintain consistent low prices
for our customers. We accomplish this by working with our suppliers to find alternative, less expensive sources of
raw materials and components as well as eliminating excess costs throughout our supply chain.

Gross Profit

Our gross profit and gross profit as a percentage of revenues, or gross margin, is influenced by several factors
including sales volume, product and service mix, and excess and obsolescence (“E&O”) charges and other product
costs. We expect gross margin to fluctuate over time based on how we control the mix of product and services and
manage our inventory. Additionally, although we primarily procure and sell our products in U.S. dollars, we are
susceptible to exchange rate fluctuations with other currencies. To the extent that exchange rates move unfavorably
this may have an impact on our future selling prices and unit costs. Gross profit and gross margin may fluctuate over
time based on the factors described above.

Operating Expenses

Our operating expenses consist principally of personnel related costs, including salaries and bonuses, fringe
benefits and stock-based compensation as well as the cost of professional services, information technology, facilities
and other administrative expenses. We classify our operating expenses into the following six categories:

•

Research and development expense consists of personnel related costs, professional services, certification
fees and software licenses incurred to support our existing installed base of telematics devices through
our field application engineers, software developers, program and product managers, as well as our effort
to develop new products and technologies.

Selling and marketing expense consists of personnel related costs including our incentive programs to
support our global sales organization as well as advertising and marketing promotions of our brands and
products, including media advertisement costs, merchandising and display costs, trade show and event
costs, and sponsorship costs.

General and administrative expense consists of personnel related costs to support our global enterprise as
well as outside services for legal, accounting, insurance, information technology, investor relations and
other costs associated with being a public company.

Intangible asset amortization is attributable to our acquired identifiable intangible assets from business
combinations. Our acquired intangible assets with definite lives are amortized from the date of acquisition
over periods ranging from four to fifteen years.

Restructuring expense consists of personnel and facility related costs resulting from our various cost
savings initiatives. Personnel costs represent severance and employee related costs, and facility charges
represent expenses for vacant office and manufacturing facility space under Corporate Expenses.

Impairment loss consists of write-offs of intangible assets for tradenames and dealer relationships
associated with LoJack products and right-of-use assets for ceased use leases.

We expect our operating costs will increase in absolute dollars due to the anticipated growth of our business and
related infrastructure as well as expansion into new geographic regions. Operating expense may fluctuate as a
percentage of revenue throughout the year due to discrete quarterly events and seasonal trends.

Non-Operating Income (Expense)

Non-operating income (expense) consists of (i) investment and interest income earned on our cash balances and
investments, (ii) interest expense on our convertible senior unsecured notes including the amortization of note discount
and debt issuance costs, (iii) the loss from extinguishment of debt and (iv) other income (expense) that includes but is
not limited to transaction gains and losses and foreign currency gains and losses. Loss from extinguishment of debt is
further explained in Note 11, Financing Arrangements, to the accompanying consolidated financial statements.

Income Tax Expense (Benefit)

We are subject to income taxes in the U.S. and related states as well as foreign jurisdictions in which we do
business. These foreign jurisdictions have statutory tax rates different than the U.S. statutory tax rate. Accordingly,
our effective tax rate will vary from the U.S. statutory income tax rate due to the amount of income allocable to each
tax jurisdiction, tax credits, and changes in valuation allowances which are provided against net deferred tax assets
when it is determined that it is more likely than not that the assets will not be realized.

Equity in Net Loss of Affiliate and related Impairment Loss

We had an investment in a technology and insurance startup company called Smart Driver Club Limited, which
represented a minority ownership interest that was accounted for under the equity method of accounting. As a result,
we recorded our portion of the losses incurred by this entity and impairment charges related to this investment as
equity in net loss of affiliate.

Income (loss) from Discontinued Operations, Net of Tax

Effective March 15, 2021, the Company and Spireon entered into an agreement pursuant to which we sold
certain assets and transferred certain liabilities of the LoJack North America business to Spireon and we received net
proceeds from Spireon of $6.6 million. On November 9, 2021, the purchase price was reduced by $0.9 million, which
was paid to Spireon, due to final working capital adjustments. We recognized a gain on the sale of the LoJack North
America business of $4.1 million during the fiscal year ended February 28, 2022.

Operations for LoJack North America are presented as discontinued operations in the accompanying
consolidated financial statements for the fiscal years ended February 28/29, 2022, 2021, and 2020, respectively. For
the fiscal year ended February 28, 2022, we have reported the operating results and cash flows related to the LoJack
North America operations through March 14, 2021. See Note 2, Discontinued Operations, for additional information.

Adjusted EBITDA

In addition to our U.S. GAAP results, we present Adjusted EBITDA as a supplemental non-GAAP measure of
our performance. Our CEO, the Chief Operating Decision Maker (“CODM”), uses Adjusted EBITDA to evaluate and
monitor segment performance. A non-GAAP financial measure is defined as a numerical measure of a company’s
financial performance that excludes or includes amounts to be different than the most directly comparable measure
calculated and presented in accordance with generally accepted accounting principles in the statements of
comprehensive income (loss), balance sheets or statements of cash flows. We define Adjusted EBITDA as Earnings
Before Investment Income, Interest Expenses, Taxes, Depreciation, Amortization, net income (loss) from discontinued
operations, stock-based compensation, acquisition and integration expenses, non-cash costs and expenses arising from
purchase accounting adjustments, litigation provision, gain from legal settlement, impairment loss and certain other
adjustments. We believe this non-GAAP financial
into our ongoing
performance and have therefore chosen to provide this information to investors for a more consistent basis of
comparison to help investors evaluate our results of ongoing operations and enable more meaningful period-to-period
comparisons. Pursuant to the rules and regulations of the U.S. Securities and Exchange Commission regarding the use
of non-GAAP financial measures, we have provided a reconciliation of non-GAAP financial measures to the most
directly comparable financial measure. See Note 20 to the accompanying consolidated financial statements for
additional information related to Adjusted EBITDA by reportable segments and reconciliation to net income (loss).

information provides additional

insight

OPERATING RESULTS

The following table sets forth the percentage of revenues represented by items included in our consolidated

statements of income for the three most recent fiscal years:

Year Ended February 28/29,
2021

2020

2022

Revenues
Cost of revenues
Gross profit
Operating expenses:

Research and development
Selling and marketing
General and administrative
Intangible asset amortization
Restructuring
Impairment losses

Operating loss
Non-operating expense, net
Loss from continuing operations before income taxes and equity in
net loss of affiliate and related impairment loss
Income tax provision from continuing operations
Loss from continuing operations before equity in net loss of
affiliate and related impairment loss
Equity in net loss of affiliate and related impairment loss
Net Loss from continuing operations
Net income (loss) from discontinued operations, net of tax
Net loss

100.0%
58.8
41.2

100.0%
60.3
39.7

100.0%
61.0
39.0

9.6
16.4
17.7
1.8
0.2
-
(4.5)
(5.6)

(10.1)
(0.4)

(10.5)
-
(10.5)
1.1
(9.4)

8.4
15.0
15.9
1.5
0.8
0.3
(2.2)
(4.5)

(6.7)
(0.2)

(6.9)
-
(6.9)
(11.4)
(18.3)

8.4
14.7
15.4
1.8
0.8
1.8
(3.9)
(5.6)

(9.5)
(6.4)

(15.9)
(0.2)
(16.1)
(8.6)
(24.7)

Unless otherwise indicated, the discussion on our results of operations provided below relates to our continuing
operations and we have recast prior period amounts for purposes of historical comparisons. See Note 2, Discontinued
Operations, to the accompanying consolidated financial statements for additional information.

Fiscal year ended February 28, 2022 (“Fiscal 2022”) compared to fiscal year ended February 28, 2021 (“Fiscal
2021”):

Revenue by Segment

(In thousands)
Segment
Software & Subscription Services
Telematics Products
Total

Fiscal years ended February 28,

2022

% of
Revenue

2021

% of
Revenue

$
Change

%
Change

$154,315
141,524
$295,839

52.2% $129,933
47.8% 178,654
100.0% $308,587

42.1% $ 24,382
57.9% (37,130)
100.0% $(12,748)

18.8%
(20.8%)
(4.1%)

Our Software & Subscription Services enable customers to gather and analyze critical data used to track, monitor
and recover vital mobile assets with real-time visibility and insights. Our services focus on three principal end markets:
(i) transportation and logistics, (ii) government and municipalities, and (iii) connected car services. As described
above, in Fiscal 2022 we began entering into subscription-based arrangements with customers that historically have
purchased MRM telematics hardware from us, a shift that favorably impacted revenues in our Software & Subscription
Services segment and unfavorably impacted revenues in our Telematics Products segment. This is a transition that we
expect will continue in Fiscal 2023 as we work toward transitioning the entire MRM telematics customer base onto
subscription arrangements. Our business has also been negatively impacted by COVID-19. Although our business
was initially impacted by COVID-19 in the first half of Fiscal 2021, we resumed device installations and activation

services soon thereafter. As also described above, in Fiscal 2022 we have experienced supply shortages driven by the
global pandemic, which have impacted all parts of our business in Fiscal 2022, including particularly our Telematics
Product revenues. We expect these supply shortages to continue for the foreseeable future as suppliers strive to create
additional production capacity.

As of February 28, 2022, our remaining contractual performance obligations for software & subscription
services were $202.0 million as compared to $145.1 million as of February 28, 2021. As mentioned above, the majority
of the growth in contractual performance obligations was driven by new customer acquisitions within the government
and municipality markets and connected car markets as well as the conversion of several significant telematics
products customers to multi-year subscription contracts.

In Fiscal 2022, Software & Subscription Services revenue increased by $24.4 million or 18.8% compared to
Fiscal 2021. The increase in revenue was primarily due to $20.9 million increase in transportation and logistics
revenues and a $2.0 million increase in our government and municipalities revenues, both driven primarily by 3G to
4G equipment upgrades, especially with our larger customers, as well as a $5.4 million increase in connected car
revenues, primarily as a result of increased revenues in the EMEA and LATAM regions. $13.4 million of the growth
in Software & Subscription Services revenues was attributable to the transition of certain Telematics Products
customers onto subscription arrangements. Recurring application subscription revenue was $93.7 million and $97.3
million for Fiscal 2022 and Fiscal 2021, respectively, and active subscribers increased by 11% in Fiscal 2022 when
compared to Fiscal 2021.

Telematics Products revenue, comprised primarily of MRM telematics and OEM/network products, decreased
by $37.1 million or 20.8% in Fiscal year 2022 compared to Fiscal 2021. This decrease was largely attributable to the
global supply imbalances described above, thereby limiting our ability to fulfill customer orders in Fiscal 2022.
Additionally, $13.4 million of this decrease was driven by the conversion of certain MRM telematics customers onto
multi-year subscription contracts, and thus Fiscal 2022 revenues generated after the contract effective dates for these
customers are classified within Software & Subscription Services revenues to the extent they are associated with a
subscription arrangement. We expect the conversion of the rest of our MRM customer base to continue over the next
six to twelve months as we continue to implement our strategy to engage with our customers under subscription
arrangements, which will lead to further decreases in Telematics Products segment revenues with an associated
increase in Software & Subscription Services revenues.

Gross Profit by Segment

(In thousands)
Segment
Software & Subscription Services
Telematics Products
Gross profit

Fiscal years ended February 28,

2022

% of
Revenue

2021

% of
Revenue

$
Change

%
Change

$ 76,945
44,941
$121,886

49.9% $ 65,411
31.8%
56,994
41.2% $122,405

50.3% $ 11,534
31.9% (12,053)
(519)
39.7% $

17.6%
(21.1%)
(0.4%)

Consolidated gross profit for Fiscal 2022 decreased by $0.5 million or 0.4% versus Fiscal 2021 due to decreased
revenues in our Telematics Products business, in addition to increased cost of procuring goods. Consolidated gross
margin increased by 150 basis points compared to the same period in last year primarily due to the increased proportion
of overall revenues attributable to Software & Subscription Services.

Software & Subscription Services: Gross profit increased by $11.5 million or 17.6% in Fiscal 2022 compared
to Fiscal 2021, primarily as a result of the $24.4 million increase in revenues described above, while gross margin
decreased by 40 basis points primarily due to subscription mix.

Telematics Products: Gross profit decreased by $12.1 million or 21.1% in Fiscal 2022 compared to Fiscal 2021,

primarily due to the $37.1 million decrease in revenues described above.

Cost of revenues excludes restructuring related costs, which are shown separately within operating expenses in

our consolidated statements of comprehensive income (loss).

Operating Expenses

(In thousands)
Research and development
Selling and marketing
General and administrative
Intangible asset amortization
Restructuring
Impairment losses
Total

Fiscal years ended February 28,

2022

2021

$
$ 28,444
48,564
52,333
5,415
600
-
$135,356

% of
Revenue

9.6% $ 25,811
16.4%
46,202
17.7%
49,077
1.8%
4,781
0.2%
2,534
825
0.0%
45.7% $129,230

% of
Revenue

$
Change
8.4% $ 2,633
2,362
15.0%
3,256
15.9%
1.5%
634
0.8% (1,934)
(825)
0.3%
41.9% $ 6,126

%
Change

10.2%
5.1%
6.6%
13.3%
(76.3%)
100.0%
4.7%

Consolidated research and development expense increased by $2.6 million or 10.2% in Fiscal 2022 compared
to Fiscal 2021 due almost entirely to increased compensation costs associated with increased development efforts
around expanding our telematics service offerings both domestically and internationally. Consolidated research and
development expense as a percentage of revenues increased to 9.6% in Fiscal 2022 compared to 8.4% in Fiscal 2021.
We plan to continue to invest in research and development of new solutions and technologies.

Consolidated selling and marketing expense increased by $2.4 million or 5.1% in Fiscal 2022 compared to
Fiscal 2021 primarily due to a $1.2 million increase in compensation costs related to additions to our sales force to
drive sales of our telematics subscription services, as well as a $0.5 million increase in outside professional services
costs related to our global marketing and branding efforts.

Consolidated general and administrative expense increased by $3.3 million or 6.6% in Fiscal 2022 compared
to Fiscal 2021 largely driven by increased compensation costs as a result of the hiring of operations management
personnel to support our global operations as we expand our business, as well as cost containment measures
undertaken in the prior year in response to the COVID-19 pandemic. The increase in general and administrative
expenses also includes the impact of $0.8 million of additional litigation reserves recorded in Fiscal 2022.

Amortization of intangibles increased by $0.6 million or 13.3% in Fiscal 2022 compared to Fiscal 2021.

As described in Note 12 to the accompanying consolidated financial statements, we commenced a plan to
capture certain synergies and cost savings related to streamlining our global operations and sales organization as well
as rationalizing certain leased properties that were vacant. In Fiscal 2022 and Fiscal 2021, we incurred restructuring
charges of $0.6 million and $2.5 million, respectively, which were comprised of severance and employee related costs.

In Fiscal 2021, we vacated certain office facilities in Richardson, Texas and Indianapolis, Indiana, which

resulted in an impairment of the corresponding right-of-use assets and related fixed assets of $0.8 million.

Non-operating Income (Expense), Net

Investment income decreased by $0.9 million to $1.2 million in Fiscal 2022 from $2.1 million in Fiscal 2021.

The decrease was primarily driven by lower investment returns on invested funds.

Interest expense decreased $0.2 million to $15.3 million in Fiscal 2022 from $15.5 million in Fiscal 2021 due

to a lower level of borrowings in the current year period.

Other non-operating expense was $2.4 million in Fiscal 2022, compared to $0.4 million in Fiscal 2021 primarily
due to costs incurred related to the wind-down, sale and transition of the LoJack North America business on March
15, 2021. In connection with the sale of the LoJack North America business, we entered into a transition services
agreement under which we have been providing certain services to Spireon, a portion of the cost of which is being
reimbursed to us by Spireon. This transition services agreement is expected to end in the first quarter of Fiscal 2023.

Income Tax Expense (Benefit)

An income tax expense of $1.1 million was recorded in Fiscal 2022, compared to $0.6 million in Fiscal 2021.
The current year income tax expense is attributable to foreign operations. The increase in the income tax expense
compared to the prior year was primarily driven by recognition of previously unrecognized tax benefits in the amount
of $0.4 million in Fiscal 2021. See Note 14, Income Taxes, to the accompanying consolidated financial statements for
additional information.

Net Income (Loss) from Discontinued Operations, Net of Tax

Net income from discontinued operations, net of tax, for Fiscal 2022 was $3.2 million compared to net loss from
discontinued operations, net of tax, in Fiscal 2021 of $35.2 million. There was no tax expense or benefit recorded in
either year due to valuation allowances recorded against deferred tax assets. The net income from discontinued
operations for the year ended February 28, 2022 was primarily driven by the $4.1 million gain on sale of discontinued
operations, which was completed on March 15, 2021. The net loss from discontinued operations for the year ended
February 28, 2021 included impairment losses of $23.8 million.

See Note 2, Discontinued Operations, to the accompanying consolidated financial statements for additional

information.

Overall Profitability Measures

Net Loss from Continuing Operations:

Our net loss from continuing operations in Fiscal 2022 was $31.1 million as compared to net loss of $21.2
million in Fiscal 2021. The increase in the net loss was primarily driven by decreased revenues as a result of global
supply shortages of certain components, as described above, and increased operating expenses largely driven by
investments in the areas of research and development, and sales and marketing to support the transition of our business
toward Software & Subscription Services, partially offset by higher gross margins.

Adjusted EBITDA:

(In thousands)
Segment
Software & Subscription Services
Telematics Products
Corporate Expense
Total Adjusted EBITDA
Total Adjusted EBITDA Margin

Fiscal years ended
February 28,

2022

2021

$
Change

%
Change

32,979
(3,990)
(4,309)
24,680

32,226
4,854
(4,974)
32,106

753
(8,844)
665
(7,426)

2.3%
(182.2%)
(13.4%)
(23.1%)

8.3%

10.4%

Adjusted EBITDA for Software & Subscription Services increased $0.8 million in Fiscal 2022 compared to
Fiscal 2021 primarily due to higher revenues offset by increased operating expenses as a result of investments we are
making to develop, market and sell our telematics solutions. Adjusted EBITDA for Telematics Products decreased
$8.8 million in Fiscal 2022 compared to Fiscal 2021 primarily due to lower revenues as described above. Corporate
Expenses decreased slightly year-over-year.

See Note 20, Segment and Geographic Data, for a reconciliation of Adjusted EBITDA by reportable segments

and a reconciliation to GAAP-basis net loss.

Fiscal 2021 compared to fiscal year ended February 29, 2020 (“Fiscal 2020”)

For a discussion of our results of operations comparison for the Fiscal 2021 and Fiscal 2020, refer to our Annual

Report on Form 10-K for Fiscal 2021, filed with the SEC on April 22, 2021.

Liquidity and Capital Resources

In Fiscal 2022, our primary cash needs have been for working capital purposes, and to a lesser extent, capital
expenditures. We have historically funded our principal business activities through cash flows generated from
operations and cash on hand. As we grow and transition our customer base to a subscription model while increasing
our revenues, there will be a need for working capital in the future. Our immediate sources of liquidity are cash, cash
equivalents and our revolving credit facility. We believe that our existing cash and cash equivalents, funds anticipated
to be generated from our operations, and available borrowing on our revolving credit facility will be sufficient to meet
our working capital needs for at least the next 12 months. Our future capital requirements may vary from those
currently planned and will depend on many factors, including our rate of sales growth, the timing and extent of
spending on various business initiatives, our international expansion, the timing of new product introductions, market
acceptance of our solutions, and overall economic conditions including the potential impact of global supply
imbalances and COVID-19 on the global financial markets. To the extent that current and anticipated future sources
of liquidity are insufficient to fund our future business activities and requirements, we may be required to seek
additional equity or debt financing.

Cash and Cash Equivalents

As of February 28, 2022, we have $79.2 million of cash and cash equivalents.

Available Borrowing Resources

Sale of LoJack North America Operations

On March 14, 2021, we entered into an agreement with Spireon pursuant to which we sold certain assets and
transferred certain liabilities of the LoJack North America business for a purchase price of $8.0 million. The
transaction was completed effective March 15, 2021 and we received net proceeds of approximately $6.6 million.
Subsequently, on November 9, 2021, the purchase price was reduced by $0.9 million, which was paid to Spireon, due
to final working capital adjustments. No further adjustments to the purchase price are expected. We also entered into
a Transition Service Agreement with Spireon on March 15, 2021 (“TSA”) to support Spireon in the transition of
LoJack North America customers and we will continue to provide recovery services to the existing installed base of
LoJack North America customers as an agent of Spireon until the termination of the TSA, which is expected to occur
in the first quarter of Fiscal 2023. During this period, we have invoiced Spireon for certain costs incurred in operating
this business. In connection with the transition services provided to Spireon during Fiscal 2022, we incurred a total
cost of $4.4 million of which $2.3 million was billed to Spireon for the services under the TSA and the
remaining $2.1 million is included as a component of other expense, net
in the consolidated statements of
comprehensive loss as these costs represent non-operating expenses.

We also entered into a post-TSA Services Agreement with Spireon on March 15, 2021 (“SA”), under which we
will continue to provide certain services related to the LoJack North America radio frequency tower infrastructure
upon termination of the TSA for a period of no longer than fifty-four months after the termination of the TSA, as
needed. As consideration for these services, Spireon will pay us a monthly service fee over the stipulated contract
term.

PPP Loan

On April 16, 2020, we received proceeds from a loan in the amount of $10 million (the “PPP Loan”) from
JPMorgan Chase Bank, N.A., as lender, pursuant to the Small Business Association (“SBA”) Paycheck Protection
Program (the “PPP”) of the Coronavirus Aid, Relief, and Economic Security Act. At the time we applied for the PPP
loan, we believed that we qualified to receive the funds pursuant to the PPP. On April 23, 2020, the SBA, in
consultation with the Department of Treasury, issued new guidance that created uncertainty regarding the qualification
requirements for a PPP loan. Out of an abundance of caution and in light of the new guidance, we repaid in full the
principal and interest on the PPP Loan on April 27, 2020.

Acquisitions

As described in Note 3, Acquisitions, to the accompanying consolidated financial statements, in March 2019 we
completed the acquisition of LoJack Mexico for a purchase price, net of cash acquired, of $12.7 million, and in April
2019 we acquired Synovia for a purchase price, net of cash acquired, of $48.9 million. We funded these acquisitions
utilizing cash on hand. As part of the Synovia acquisition, we assumed the rights and obligations from the Synovia
revenue assignments (“Due to Factors”) as described in Note 11, Financing Arrangements, to the accompanying
consolidated financial statements. The revenues recognized from this arrangement of $4.6 million, $6.3 million and
$6.8 million were considered a non-cash financing activity for Fiscal 2022, Fiscal 2021 and Fiscal 2020, respectively.

Material Cash Requirements

Following is a summary of our contractual cash obligations as of February 28, 2022 (in thousands):

Contractual Obligations
Convertible senior notes principal
Convertible senior notes stated
interest
Operating leases
Purchase obligations
Total contractual obligations

Less than 1
year

Future Estimated Cash Payments Due by Period

1 - 3 years

3 - 5 years

> 5 years

Total

- $

230,000 $

- $

230,000

4,600
5,894
59,005
69,499 $

9,200
9,522
-
18,722 $

2,300
4,424
-

236,724 $

-
500
-
500 $

16,100
20,340
59,005
325,445

Purchase obligations consist primarily of inventory purchase commitments.

Other

We are a defendant in various legal proceedings involving intellectual property claims and contract disputes matters
whereby the final settlement has not been determined at this time. In connection with these matters, we may have to
enter into license agreements or other settlement arrangements that could require us to make significant payments in
the future. Based on current information available, we do not believe that there are any claims that would have a
material adverse effect on our financial condition, results of operations, or liquidity. See Note 19, Commitments and
Contingencies, to the accompanying consolidated financial statements for additional information on legal proceedings.

Cash flows from operating activities

Cash flows from operating activities consist of net income (loss) adjusted for certain non-cash items, including
depreciation, intangible asset amortization, stock-based compensation expense, amortization of debt issuance costs
and discount, deferred income taxes, amortization of certain revenue assignment arrangements and the effect of
changes in working capital and other activities.

Our cash flows from operating activities are attributable to our net loss as well as how well we manage our
working capital, which is dictated by the volume of devices we purchase from our manufacturers or suppliers and then
sell to our customers, the cadence at which we transition our customers to subscription arrangements as well as the
payment and collection terms that we negotiate with customers and suppliers. We purchase a majority of our devices
from significant suppliers located in Asia and Mexico that generally provide us 60-day payment terms for products
purchased.

Our significant customers are located in the U.S. as well as certain foreign countries. We believe that our
relationships with our key customers are good and that these customers are in good financial condition. We generally
grant credit to our customers based on their financial viability and our historical collection experience with them. We
typically require payment from our customers within 30 to 45 days of our invoice date with a few exceptions that
extend the credit terms up to 90 days. Historically, since we paid our suppliers at or within 60 days of inventory
purchase and our payment terms on our accounts receivable are generally within 45 days, we generated positive cash
flows from operating activities. In Fiscal 2022, we began entering into subscription arrangements with key customers
who previously purchased telematics devices from us. While these subscription arrangements create recurring multi-
year revenue, they elongate the cash conversion cycle as we must outlay cash for the associated device but recover
this cash outlay over a subscription period. Thus in Fiscal 2022 the conversion of certain significant customers onto
subscription arrangements had an unfavorable impact on cash flows. We anticipate that this trend will continue in the
coming year as we continue our efforts to transition our entire MRM telematics customer base onto similar multi-year
subscription arrangements.

For Fiscal 2022, net cash used in operating activities was $4.2 million with a net loss of $28.0 million. Our non-
cash income and expenses from continuing operations totaled $48.7 million, comprised principally of depreciation,
intangible assets amortization, stock-based compensation expense, amortization of debt issuance costs and discounts,
. These non-cash expenses were partially
noncash operating lease costs and changes in deferred income tax assets
offset by non-cash revenues of $4.6 million related to acquired revenue assignment arrangements. Changes in
operating assets and liabilities from continuing operations used was $17.4 million of cash, largely as a result of a $14.2
million decrease in deferred revenue, which was primarily attributable to the wind-down of the auto vehicle finance
business that we decided to exit in Fiscal 2021. The wind-down of the auto vehicle finance business was largely
complete as of the end of Fiscal 2022. Operating cash flows were also impacted by a $5.6 million decrease in operating
lease liabilities. Net cash used in discontinued operations was $0.4 million.

Cash flows from investing activities

In Fiscal 2022 and Fiscal 2021 , our net cash used in investing activities was $7.6 million and $13.7
million, respectively. In both of these periods, our primary investing activities consisted of capital expenditures. We
expect that we will make additional capital expenditures in the future, including devices that we lease to customers
under subscription agreements in order to support the future growth of our business.

Net cash provided by investing activities of discontinued operations was $5.7 million in Fiscal 2022, which was
comprised of cash proceeds received from the sale of the LoJack North America business. Net cash used in investing
activities of discontinued operations was $2.3 million in Fiscal 2021.

Cash flows from financing activities

In Fiscal 2022 and Fiscal 2021 , our net cash used in financing activities was $2.6 million and $27.3
million, respectively. In both of these periods, we incurred payments for taxes related to the net share settlement of
vested equity awards and the proceeds for the exercise of stock options. In Fiscal 2021, we repaid the remaining
outstanding portion of our 2020 Convertible Notes of $27.6 million, as well as borrowed and repaid $20.0 million
from our revolving credit facility.

Critical Accounting Estimates

The preparation of financial statements and related disclosures in conformity with accounting principles
generally accepted in the United States requires us to make judgments, assumptions, and estimates that affect the
amounts reported in the Consolidated Financial Statements and accompanying notes. Note 1 to the Consolidated
Financial Statements for Fiscal 2022 describes the significant accounting policies and methods used in the preparation
of the Consolidated Financial Statements. The accounting policies described below are significantly affected by
critical accounting estimates. Such accounting policies require significant judgments, assumptions, and estimates used
in the preparation of the Consolidated Financial Statements, and actual results could differ materially from the amounts
reported based on these policies.

The inputs into certain of our judgments, assumptions, and estimates considered the economic implications of
the COVID-19 pandemic on our critical and significant accounting estimates. These estimates are listed in our
Consolidated Financial Statements for Fiscal 2022, and include: revenue recognition, patent litigation and loss
contingencies, goodwill and long-lived assets and income taxes, among other items. The actual results that we
experience may differ materially from our estimates. As the COVID-19 pandemic continues to develop, many of our
estimates could require increased judgment and carry a higher degree of variability and volatility. As events continue
to evolve our estimates may change materially in future periods.

Revenue Recognition

We enter into contracts with customers that can include various combinations of products and services. As a
result, our contracts may contain multiple performance obligations. In many customer arrangements subscription
services are bundled with the sale or lease of telematics devices within the same contractual arrangement. To determine
the performance obligations under these arrangements, we assess the contractual elements and, in particular, whether
the telematics products within the arrangement are distinct. This is an area of judgment that includes the consideration
of all elements of the arrangement. Significant factors in determining whether telematics devices are distinct are
whether such devices are sold separately, as well as the degree of integration and interdependency between the
subscription elements of the arrangement and the associated telematics devices. If we conclude that the telematics
devices within a customer arrangement are distinct and therefore represent a separate performance obligation, the total
expected consideration associated with the contract is allocated between the performance obligations based upon the
relative stand-alone selling price associated with each performance obligation. We base stand-alone selling prices on
pricing tables for the same or similar items.

For some customer arrangements, we have concluded that the subscription services and associated telematics
devices are not distinct performance obligations and thus represent a single combined performance obligation. In these
circumstances, we generally recognize the total expected consideration as revenue over the term of the subscription.

Patent Litigation and Other Contingencies

We are subject to the possibility of various losses arising in the ordinary course of business. We consider the
likelihood of impairment of an asset or the incurrence of a liability, as well as our ability to reasonably estimate the
amount of loss, in determining loss contingencies. An estimated loss contingency is accrued when it is probable that
an asset has been impaired or a liability has been incurred and the amount of loss can be reasonably estimated. We
regularly evaluate information available to us to determine whether such accruals should be made or adjusted and
whether new accruals are required.

Third parties, including customers, have in the past and may in the future assert claims or initiate litigation
related to exclusive patent, copyright, trademark, and other intellectual property rights to technologies and related
standards that are relevant to us. These assertions may increase over time as a result of our growth and the general
increase in the pace of patent claims assertions, particularly in the United States. If any infringement or other
intellectual property claim made against us by any third party is successful, or if we fail to develop non-infringing
technology or license the proprietary rights on commercially reasonable terms and conditions, our business, operating
results, and financial condition could be materially and adversely affected.

We accrue for these intellectual property claims whenever we determine that an unfavorable outcome is probable
and the liability is reasonably estimable. The amount of the accrual is estimated based on our review of each individual
claim, including the type and facts of the claim and our assessment of the merits of the claim. Since these legal matters
can be very complex and require significant judgment, we often utilize external legal counsel and other subject matter
experts to assist us in defending against such claims. These accruals are reviewed at least on a quarterly basis and are
adjusted to reflect the impact of recent negotiations, settlements, court rulings, advice from legal counsel and other
events pertaining to the case. Although we believe that we take reasonable and considerable measures to mitigate our
exposure in these matters, the outcome of litigation is inherently unpredictable. Nonetheless, we believe that we have
valid defenses with respect to pending legal matters against us as well as adequate provisions for probable and
estimable losses. All costs for legal services are expensed as incurred.

Two open patent infringement lawsuits filed against us by Omega Patents, LLC (“Omega”) and Koninklijke

Philips N.V. (“Philips”) are discussed in more detail below.

Omega

A mediation was held with the Company and Omega on April 12, 2022 to work towards a settlement. No
settlement was reached during the mediation. In connection with this claim, we have accrued our best estimate of the
probable liability of $3.0 million as a litigation reserve related to this matter based on reasonable royalty rates for
similar technologies. It is reasonably possible that the court in a new trial may award Omega damages and pre-
judgment interest in excess of the amounts we have accrued. Additionally, it is possible that the case may be settled
and that the amount required to be paid by us in such settlement may be different from the litigation reserve we have
recorded.

Philips

On April 1, 2022, the administrative law judge (“ALJ”) at the International Trade Commission (“ITC”) issued
a Final Initial Determination on the question of the violation of section 337 (19 U.S.C. § 1337). The administrative
law judge determined that a violation of section 337 has not occurred with respect to any of the asserted patents. On
April 13, 2022, Philips filed a Petition for Commission Review of the ALJ's Final Initial Determination, and
Respondents responded to Philips’ Petition on April 21, 2022. The district court cases related to Philips in Delaware
have been stayed pending the final outcome of the ITC matter. We believe that we have strong non-infringement and
invalidity defenses should the Delaware district court cases proceed. Also, we believe we have strong indemnification
claims against our communication module suppliers, and are entitled to have our defense costs and any losses resulting
from these proceedings paid by those suppliers, who are co-defendants in these proceedings. Currently, it is not
feasible to predict with certainty the outcome of these four legal proceedings, and no specific amount of damages has
been identified.

See Note 19, Commitments and Contingencies, to the accompanying consolidation financial statements for

additional information.

Goodwill and Long-lived Assets

Goodwill represents the excess of the purchase price over the fair value of net assets acquired in a business
combination. We test goodwill for impairment in accordance with the provisions of ASC 350, Intangibles – Goodwill
and Other, (“ASC 350”). Goodwill is tested for impairment at least annually at the reporting unit level or whenever
events or changes in circumstances indicate that goodwill might be impaired. ASC 350 provides that an entity has the
option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a
determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If,
after assessing the totality of events or circumstances, an entity determines it is not more likely than not that the fair
value of a reporting unit is less than its carrying amount, then additional impairment testing is not required. However,
if an entity concludes otherwise, then it is required to perform an impairment test. The impairment test involves
comparing the estimated fair value of a reporting unit with its book value, including goodwill. If the estimated fair
value exceeds book value, goodwill is considered not to be impaired. If, however, the fair value of the reporting unit
is less than book value, then an impairment loss is recognized in an amount equal to the amount that the book value
of the reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to the reporting unit.

estimate the fair value of the reporting units. Significant assumptions inherent in estimating the fair values include the
estimated future cash flows, growth assumptions for future revenues (including future gross margin rates, expense
rates, capital expenditures and other estimates), and a rate used to discount estimated future cash flow projections to
their present value (or estimated fair value) based on estimated weighted average cost of capital (i.e., the selected
discount rate). We select assumptions used in the financial forecasts by using historical data, supplemented by current
and anticipated market conditions, estimated growth rates, and management’s plans. Under the market approach, fair
value is derived from metrics of publicly traded companies or historically completed transactions of comparable
businesses (i.e. guideline companies). The selection of comparable businesses is based on the markets in which the
reporting units operate giving consideration to risk profiles, size, geography, and diversity of products and services.

Long-lived assets to be held and used, including identifiable intangible assets, are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully
recoverable. These events or changes in circumstances may include a significant deterioration of operating results,
changes in business plans or changes in anticipated future cash flows. If an impairment indicator is present, we
evaluate recoverability by a comparison of the carrying amount of the assets or asset group to future undiscounted net
cash flows expected to be generated by the lowest level of asset group. If the assets or asset group are impaired, the
impairment recognized is measured by the amount by which the carrying amount exceeds the fair value of the assets.
Fair value is generally determined by estimates of discounted cash flows. The discount rate used in any estimate of
discounted cash flows would be the rate required for similar investment of like risk.

The recoverability assessment with respect to each of the tradenames used in our operations requires us to
estimate the fair value of the asset as of the assessment date. Such determination is made using discounted cash flow
techniques (Level 3 determination of fair value). Significant inputs to the valuation model include future revenue and
profitability projections associated with the tradename through a relief from royalty approach; estimated market
royalty rates that could be derived from the licensing of our tradenames to third parties in order to establish the cash
flows accruing to the benefit of the Company as a result of our ownership of our tradenames; and rates used to discount
the estimated royalty cash flow projections to their present value (or estimated fair value).

As further described above, we have begun entering into subscription arrangements with customers who have
historically purchased MRM telematics products from us, which is expected to result in growth in Software &
Subscription Services revenues and a corresponding decline in Telematics Products revenues as we transition the
MRM telematics business to long-term subscription contracts. This transition is expected to be completed over the
course of Fiscal 2023. As a result of this transition, the fair value of the Telematics Products reporting unit exceeds its
carrying value by approximately 22%.

At February 28, 2022, we had $94.4 million in goodwill and $32.0 million in other net intangible assets, recorded
on our consolidated balance sheet. Additionally, we had three reporting units, one reporting unit under our Telematics
Products segment and two reporting units under our Software and Subscription Services segment. Our Telematics
Products segment includes $39.2 million of goodwill and our Software & Subscription Service segment includes $55.2
million.

See Note 8, Property and Equipment, and Note 9, Goodwill and Other Intangible Assets, to the accompanying

consolidated financial statements for additional information.

Income Taxes

We are subject to income taxes in the United States and numerous foreign jurisdictions. Our effective tax rates
differ from the statutory rate, primarily due to the tax impact of state taxes, foreign operations, R&D tax credits, global
intangible low-taxed income, nondeductible officer compensation, and transfer pricing adjustments. Our tax provision
for income taxes is inherently difficult to estimate and record. This is due to the complex nature of the U.S. and
International tax codes; earnings being different than anticipated in countries with different tax rates; changes in the
valuation of our deferred tax assets and liabilities; changes in tax laws and regulations, treaties, or interpretations
thereof, including changes to the taxation of earnings of our foreign subsidiaries, the deductibility of expenses
attributable to foreign income, and the foreign tax credit rules.

Significant judgment is required in evaluating our uncertain tax positions and determining our provision for
income taxes. We believe our reserves are reasonable and that our historical income tax provisions and accruals for
these uncertain positions are sufficient. We adjust these reserves in light of changing facts and circumstances, such as
the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is
different than the amounts recorded, such differences will impact the provision for income taxes in the period in which
such determination is made. The provision for income taxes includes the impact of reserve provisions and changes to
reserves that are considered appropriate, as well as the related net interest and penalties.

Significant judgment is also required in determining any valuation allowance recorded against our net deferred
tax assets in a particular jurisdiction. Currently we maintain a valuation allowance in the U.S. and certain foreign
jurisdictions. In assessing the need for a valuation allowance, we consider all available evidence, including past
operating results, estimates of future taxable income, and the feasibility of tax planning strategies. In the event that
we change our determination as to the amount of deferred tax assets that can be realized, we will adjust our valuation
allowance with a corresponding impact to the provision for income taxes in the period in which such determination is
made.

At February 28, 2022, our federal income tax loss carryforwards were approximately $75.3 million, our state
income tax loss carryforwards were approximately $68.3 million, and our foreign income tax loss carryforwards were
approximately $60.7 million. Since these losses have varying degrees of carryforward periods, it requires us to
estimate the amount of carryforward losses that we can reasonably expect to realize. Future changes in anticipated
earnings could change the amount of carry forward losses that we expect to realize and the amount of valuation
allowances we have recorded (see Note 14, Income Taxes, for additional information).

Forward Looking Statements

Forward looking statements in this Form 10-K which include, without limitation, statements relating to our
plans, strategies, objectives, expectations, intentions, projections and other information regarding future performance,
are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words
“may”, “will”, “could”, “plans”, “intends”, “seeks”, “believes”, “anticipates”, “expects”, “estimates”, “judgment”,
“goal”, and variations of these words and similar expressions, are intended to identify forward-looking statements.
These forward-looking statements reflect our current views with respect to future events and financial performance
and are subject to certain risks and uncertainties that are difficult to predict, including, without limitation, the impact
of adverse and uncertain economic conditions in the U.S. and international markets, the sufficiency of our cash and
cash equivalents to meet our liquidity needs and service our indebtedness, product demand, competitive pressures and
pricing declines in our markets, the timing of customer approvals of new product designs, intellectual property
interruption or failure of our Internet-based systems used to wirelessly configure and
infringement claims,
communicate with the tracking and monitoring devices that we sell, global component supply shortages due to ongoing
supply chain constraints, the phased implementation of our ERP system, the effect of tariffs on exports from China
and other countries, the ongoing effects of the COVID-19 pandemic (including its effect on the supply of labor), and
other risks and uncertainties that are set forth in Part I, Item 1A of this Annual Report on Form 10-K (Risk Factors).
Such risks and uncertainties could cause actual results to differ materially and adversely from historical or anticipated
results. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable
assumptions, we can give no assurance that our expectations will be attained. We undertake no obligation to update
or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except
as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such
forward-looking statements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Currency Risk

We have international operations, giving rise to exposure to market risks from changes in currency exchange
rates. A cumulative foreign currency translation loss of $1.4 million related to our foreign subsidiaries is included in
accumulated other comprehensive loss in the stockholders' equity section of the consolidated balance sheet at
February 28, 2022. The aggregate foreign currency transaction exchange rate losses included in determining loss
before income taxes and equity in net loss of affiliate were $0.2 million, $0.2 million and $0.2 million in fiscal years
ended February 28/29, 2022, 2021 and 2020, respectively.

Interest Rate Risk

Our exposure to market rate risk for changes in interest rates relates primarily to our marketable securities
investment portfolio. The primary objective of our investment activities is to preserve principal and liquidity while at
the same time maximizing yields without significantly increasing risk. To achieve this objective, we maintain our
investments portfolio in a variety of available-for-sale fixed debt securities, including both government and corporate
obligations and money market funds. Investments in fixed rate interest bearing instruments carry a degree of interest
rate risk. Fixed rate securities may have their fair market value adversely impacted due to a rise in prevailing interest
rates. Due in part to these factors, we may suffer losses in principal if we need the funds prior to maturity and choose
to sell securities that have declined in market value due to changes in interest rates or perceived credit risk related to
the securities’ issuers.

As the majority of our investment portfolio has a short-term nature, we do not believe an immediate increase or
decrease in interest rate would have a material effect on the fair market value of our portfolio, and therefore, we do
not expect our operating results or cash flows to be materially affected by a sudden change in market interest rates.

We do not believe our cash equivalents have significant risk of default or illiquidity. However, we cannot
provide absolute assurance that in the future our investments will not be subject to adverse changes in market value.
In addition, we maintain significant amounts of cash and cash equivalents at one or more financial institutions that are
in excess of federally insured limits. We cannot be assured that we will not experience losses on these deposits.

Our revolving credit facility with JPMorgan Chase Bank, N.A. provides for borrowings of up to $50 million
and was set to expire on March 30, 2022. We have entered into an amendment to extend the term of this credit facility
to June 30, 2022 with the intention of entering into a new revolving credit facility. Loans outstanding under our
revolving credit facility bear interest at either euro currency rate plus a margin or the base rate (highest of (i) 0%, (ii)
the rate of interest publicly announced by the Agent as its prime rate in effect at its principal office in New York City,
(iii) the overnight bank funding rate as determined by the Federal Reserve Bank of New York plus 0.50% and (iv) the
LIBOR-based rate for a one-month interest period on such day plus 1%). An applicable margin is added based on the
Company’s senior leverage ratio, ranging from 1.50% to 2.00% for base rate loans, and from 2.50% to 3.00% for
Eurodollar loans. Changes in interest rate would impact our variable rate borrowings. There were no borrowings
outstanding under this revolving credit facility at February 28, 2022.

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of CalAmp Corp.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of CalAmp Corp. and subsidiaries (the "Company")
as of February 28, 2022 and February 28, 2021, the related consolidated statements of comprehensive loss,
stockholders’ equity, and cash flows for each of the three years in the period ended February 28, 2022, and the related
notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in
all material respects, the financial position of the Company as of February 28, 2022 and February 28, 2021, and the
results of its operations and its cash flows for each of the three years in the period ended February 28, 2022, in
conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the Company’s internal control over financial reporting as of February 28, 2022, based on criteria
established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations
of the Treadway Commission and our report dated April 28, 2022 expressed an unqualified opinion on the Company’s
internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an
opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with
the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to
those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in
the financial statements. Our audits also included evaluating the accounting principles used and significant estimates
made by management, as well as evaluating the overall presentation of the financial statements. We believe that our
audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial
statements that were communicated or required to be communicated to the audit committee and that (1) relate to
accounts or disclosures that are material to the financial statements and (2) involved our especially challenging,
subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion
on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below,
providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Goodwill – Telematics Products Reporting Unit – Refer to Notes 1 and 9 to the Financial Statements

Critical Audit Matter Description

Goodwill is tested for impairment at least annually at the reporting unit level or whenever events or changes in
circumstances indicate that goodwill might be impaired. The impairment test involves comparing the estimated fair
value of a reporting unit with its book value, including goodwill. The estimates of fair value of the reporting units are
computed using either an income approach, a market approach, or a combination of both. Under the income approach,
the Company utilizes the discounted cash flow method to estimate the fair value of the reporting units. Significant
assumptions inherent in estimating the fair values include the estimated future cash flows, growth assumptions for
future revenues (including future gross margin rates, expense rates, capital expenditures and other estimates), and a

rate used to discount estimated future cash flow projections to their present value (or estimated fair value) based on
estimated weighted average cost of capital (i.e., the selected discount rate). The Company selected assumptions used
in the financial forecasts by using historical data, supplemented by current and anticipated market conditions,
estimated growth rates, and management’s plans. Under the market approach, fair value is derived from metrics of
publicly traded companies or historically completed transactions of comparable businesses (i.e., guideline companies).
The selection of comparable businesses is based on the markets in which the reporting units operate giving
consideration to risk profiles, size, geography, and diversity of products and services.

The goodwill balance was $94.4 million as of February 28, 2022, of which $39.2 million is allocated to the Telematics
Products reporting unit. The fair value of the Telematics Products reporting unit exceeded its carrying value as of the
measurement date, and therefore, no impairment was recognized.

We identified goodwill impairment for the Telematics Products reporting unit as a critical audit matter because of the
significant estimates and assumptions made by management to estimate the fair value of the Telematics Products
reporting unit. This required a high degree of auditor judgment and an increased extent of effort, including the
involvement of our fair value specialists, when performing audit procedures to evaluate the reasonableness of
management’s cash flow projections, including gross margin rates, operating expenses, and the selected discount rate,
and mostly notably, considerations related to the ongoing transition of customers from the Telematics Products
reporting unit to a reporting unit under the Company’s Software & Subscription Services operating segment.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the assumptions of gross margin rates, operating expenses and the selected discount
rate included the following, among others:

We tested the effectiveness of controls over management’s goodwill impairment evaluation, including those over
management’s cash flow projections of gross margin rates, operating expenses and the selection of the discount rate.

We evaluated management’s ability to accurately project future gross margin rates and operating expenses by
comparing actual results to management’s historical projections, obtaining evidence for changes in future gross margin
rates and operating expense projections, and inquiring with management to understand the overall basis for their cash
flow projections. This included management’s evaluation of the ongoing customer transition from the Telematics
Products reporting unit to a reporting unit under the Company’s Software & Subscription Services operating segment
and how that would, in turn, impact future gross margins and operating expenses.

We evaluated the reasonableness of management’s cash flow projections of future gross margin rates and operating
expenses by comparing the projections to (1) historical gross margin rates and operating expenses, (2) management’s
long-range strategic plan which was communicated to the Board of Directors, and (3) projected information included
in the Company’s press releases, as well as, in analyst and industry reports for the Company.

With the assistance of our fair value specialists, we evaluated the reasonableness of the (1) valuation methodology
including guideline companies and (2) discount rate by:

– Evaluating the valuation methodology utilized by the Company including the market and income approaches

– Evaluating and determining the appropriateness of the multiples, recently completed transactions and guideline
public companies utilized in the analysis

– Testing the source information underlying the determination of the discount rate and the mathematical accuracy of
the calculation.

– Developing a range of independent estimates and comparing those to the discount rate selected by management.

Revenue Recognition — Refer to Note 1 to the financial statements

Critical Audit Matter Description

In many customer arrangements within the Company’s Software & Subscription Services segment, the subscription
services are bundled with the sale or lease of telematics devices within the same contractual arrangement. To determine
the performance obligations under these arrangements, the Company assesses the contractual elements and, in
particular, whether the telematics products within the arrangement are distinct. This is an area of judgment that
includes the consideration of all elements of the arrangement. Significant factors in determining whether telematics
devices are distinct are whether such devices are sold separately, as well as the degree of integration and
interdependency between the subscription elements of the arrangement and the associated telematics devices. If the
Company concludes that the telematics devices within a customer arrangement are distinct, and therefore represent a
separate performance obligation, the total expected consideration associated with the contract is allocated between the
performance obligations based upon the relative stand-alone selling price associated with each performance obligation.

For some customer arrangements, the Company has concluded that the subscription services and associated telematics
devices are not distinct promises and thus represent a single combined performance obligation. In these circumstances,
the Company generally recognizes the total expected consideration as revenue over the term of the subscription.

Significant judgment is required to determine whether the performance obligations in these contracts are distinct based
on whether the customer can benefit from the product or service on its own or together with other resources that are
readily available and whether the commitment to transfer the product or service to the customer is separately
identifiable from other obligations in the contract. This judgment can have a significant impact on the timing of
revenue recognition. Auditing these aspects include especially challenging auditor judgment due to the nature and
extent of audit effort required to address this matter.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to management’s evaluation of contracts with multiple promises included the following,
among others:

– We tested the effectiveness of controls related to management’s identification and assessment of performance
obligations in contracts with customers.

– We performed an analysis of how each step within the accounting guidance was addressed for each revenue
transaction selected in our substantive test of details.

– We tested management’s identification of performance obligations by evaluating whether the customer can benefit
from the product or service on its own or together with other resources that are readily available and whether the
underlying goods and services were highly interdependent and interrelated.

– We obtained and tested individual customer contracts to evaluate the appropriateness of management’s identification
of performance obligations.

– We verified that the timing of revenue recognition was appropriate based on the performance obligation identified
by inspecting evidence supporting the transfer of control of telematics devices or services to the customer.

/s/ Deloitte & Touche LLP

Costa Mesa, CA

April 28, 2022

We have served as the Company’s auditor since fiscal 2018.

CALAMP CORP.
CONSOLIDATED BALANCE SHEETS
(In thousands, except par value)

Assets

Current assets:

Cash and cash equivalents
Accounts receivable, net
Inventories
Prepaid expenses and other current assets
Current assets of discontinued operations

Total current assets

Property and equipment, net
Operating lease right-of-use assets
Deferred income tax assets
Goodwill
Other intangible assets, net
Other assets

Total assets

Liabilities and Stockholders' Equity

Current liabilities:

Current portion of long-term debt
Accounts payable
Accrued payroll and employee benefits
Deferred revenue
Other current liabilities
Current liabilities of discontinued operations

Total current liabilities
Long-term debt, net of current portion
Operating lease liabilities
Other non-current liabilities
Non-current liabilities of discontinued operations

Total liabilities

Commitments and contingencies (see Note 19)
Stockholders' equity:

Preferred stock, $.01 par value; 3,000 shares authorized;

no shares issued or outstanding

Common stock, $.01 par value; 80,000 shares authorized;
36,052 and 35,229 shares issued and outstanding
at February 28, 2022 and 2021, respectively

Additional paid-in capital
Accumulated deficit
Accumulated other comprehensive loss

Total stockholders' equity
Total liabilities and stockholders' equity

February 28,

2022

2021

79,221
61,544
18,269
22,348
-
181,382
37,674
12,327
4,165
94,436
31,965
29,632
391,581

2,585
31,815
10,929
26,174
18,951
-
90,454
189,703
13,382
22,640
-
316,179

94,624
63,325
23,663
24,804
7,872
214,288
41,081
14,273
4,889
94,617
37,488
27,169
433,805

4,317
35,767
12,761
32,924
17,380
4,096
107,245
182,154
17,061
30,487
1,773
338,720

361
242,386
(165,965)
(1,380)
75,402
391,581

352
233,692
(137,974)
(985)
95,085
433,805

See accompanying notes to consolidated financial statements.

CALAMP CORP.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In thousands, except per share amounts)

Year Ended February 28/29,
2021

2020

2022

Revenues:

Products
Application subscriptions and other services

Total revenues

Cost of revenues:
Products
Application subscriptions and other services

Total cost of revenues

Gross profit
Operating expenses:

Research and development
Selling and marketing
General and administrative
Intangible asset amortization
Restructuring
Impairment losses

Total operating expenses

Operating loss
Non-operating income (expense):

Investment income
Interest expense
Loss on extinguishment of debt
Other expense, net

Total non-operating expenses

Loss from continuing operations before income taxes and equity in net
loss of affiliate and related impairment loss
Income tax provision from continuing operations
Loss from continuing operations before equity in net loss of affiliate and
related impairment loss
Equity in net loss of affiliate and related impairment loss
Net loss from continuing operations
Net income (loss) from discontinued operations, net of tax
Net loss

Loss per share - continuing operations:

Basic
Diluted

Earnings (loss) per share - discontinued operations:

Basic
Diluted

Shares used in computing earnings (loss) per share:

Basic
Diluted

Comprehensive loss:

Net loss
Other comprehensive income (loss):

Foreign currency translation adjustments

Total comprehensive loss

$
$

182,916
112,923
295,839

119,850
54,103
173,953
121,886

28,444
48,564
52,333
5,415
600
-
135,356
(13,470)

1,175
(15,323)
-
(2,443)
(16,591)

(30,061)
(1,087)

193,486
115,101
308,587

129,578
56,604
186,182
122,405

25,811
46,202
49,077
4,781
2,534
825
129,230
(6,825)

2,119
(15,487)
-
(403)
(13,771)

(20,596)
(561)

(31,148)
-
(31,148)
3,157
(27,991) $

(21,157)
-
(21,157)
(35,152)
(56,309) $

(0.88) $
(0.88) $

0.09
0.09

$
$

(0.62) $
(0.62) $

(1.02) $
(1.02) $

35,254
35,254

34,389
34,389

214,374
107,399
321,773

135,987
60,293
196,280
125,493

26,993
47,379
49,479
5,871
2,465
5,754
137,941
(12,448)

4,497
(20,096)
(2,408)
(113)
(18,120)

(30,568)
(20,454)

(51,022)
(530)
(51,552)
(27,752)
(79,304)

(1.54)
(1.54)

(0.82)
(0.82)

33,670
33,670

(27,991) $

(56,309) $

(79,304)

(395)
(28,386) $

390
(55,919) $

(714)
(80,018)

See accompanying notes to consolidated financial statements.

CALAMP CORP.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In thousands)

Years Ended February 28/29,
2021

2020

2022

Total stockholders' equity, beginning balances

95,085

137,919

205,653

Common stock and additional paid-in capital:
Beginning balances
Stock-based compensation expense
Shares issued on net share settlement of equity awards
Exercise of stock options and contributions to ESPP
Ending balances

Accumulated deficit:
Beginning balances
Cumulative adjustment upon adoption of ASU 326
Net loss
Ending balances

Accumulated other comprehensive income (loss):
Beginning balances
Foreign currency translation adjustments
Ending balances

234,044
11,346
(4,173)
1,530
242,747

220,825
12,880
(1,628)
1,967
234,044

(137,974)
-
(27,991)
(165,965)

(81,531)
(134)
(56,309)
(137,974)

(985)
(395)
(1,380)

(1,375)
390
(985)

208,541
12,421
(2,007)
1,870
220,825

(2,227)
-
(79,304)
(81,531)

(661)
(714)
(1,375)

Total stockholders' equity, ending balances

75,402

95,085

137,919

See accompanying notes to consolidated financial statements.

CALAMP CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss
Less: Net income (loss) from discontinued operations, net of tax
Net loss from continuing operations
Adjustments to reconcile net loss from continuing operations to net cash provided by (used in)
operating activities:

Depreciation expense
Intangible asset amortization
Stock-based compensation
Amortization of debt issuance costs and discount
Impairment losses
Noncash operating lease cost
Loss on extinguishment of debt
Revenue assigned to factors
Deferred tax assets, net
Equity in net loss of affiliate and related impairment loss
Changes in operating assets and liabilities of continuing operations, excluding effects from
acquisitions:

Accounts receivable
Inventories
Prepaid expenses and other current assets
Accounts payable
Accrued liabilities
Deferred revenue
Operating lease liabilities

Other

Net cash provided by (used in) operating activities - continuing operations
Net cash provided by (used in) operating activities - discontinued operations
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES:

Proceeds from maturities and sale of marketable securities
Purchases of marketable securities
Capital expenditures
Acquisitions, net of cash acquired
Other

Net cash used in investing activities - continuing operations
Net cash provided by (used in) investing activities - discontinued operations
NET CASH USED IN INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from Paycheck Protection Program Loan
Repayment of Paycheck Protection Program Loan
Proceeds from revolving credit facility, net of issuance costs
Repayment of 2020 Convertible Notes
Repurchase of 2020 Convertible Notes
Repayment of revolving credit facility
Taxes paid related to net share settlement of vested equity awards
Proceeds from exercise of stock options and contributions to employee stock purchase plan

NET CASH USED IN FINANCING ACTIVITIES
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

Year Ended February 28/29,
2021

2020

2022

(27,991) $
3,157
(31,148)

(56,309) $
(35,152)
(21,157)

(79,304)
(27,752)
(51,552)

17,389
5,415
11,321
10,411
-
3,713
-
(4,566)
465
-

1,436
5,164
(219)
(4,782)
796
(14,228)
(5,585)
595
(3,823)
(395)
(4,218)

-
-
(13,298)
-
-
(13,298)
5,721
(7,577)

-
-
-
-
-
-
(4,173)
1,530
(2,643)
(965)
(15,403)
94,624
79,221

17,221
4,781
11,364
10,180
825
421
-
(6,291)
(1)
-

1,624
8,691
(7,311)
10,166
8,257
(6,199)
(297)
723
32,997
(4,412)
28,585

6,264
(6,264)
(11,356)
-
-
(11,356)
(2,338)
(13,694)

10,000
(10,000)
19,944
(27,599)
-
(20,000)
(1,628)
1,967
(27,316)
(355)
(12,780)
107,404
94,624

17,441
5,871
10,667
13,764
5,754
1,534
2,408
(6,844)
18,552
530

7,549
(1,439)
(2,014)
(17,598)
4,602
1,975
(4,962)
599
6,837
4,707
11,544

37,055
(19,543)
(21,301)
(60,652)
(366)
(64,807)
(891)
(65,698)

-
-
-
-
(94,683)
-
(2,007)
1,870
(94,820)
(122)
(149,096)
256,500
107,404

See accompanying notes to consolidated financial statements.

CALAMP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Recent Events

COVID-19

In March 2020, the World Health Organization declared COVID-19 (“COVID-19” or the “pandemic”) to be a
public health pandemic of international concern, which has resulted in travel restrictions and in some cases,
prohibitions of non-essential activities, disruption and shutdown of businesses and greater uncertainty in global
financial markets. Since March 2020, our revenues have been negatively impacted by COVID-19 as various small-to-
medium sized customers postponed their capital expenditures due to the pandemic and related macro-economic
uncertainties. More recently we have experienced supply shortages as a result of global supply imbalances driven by
the global pandemic. These global supply imbalances have negatively impacted all parts of our business during fiscal
2022. It is difficult to predict the extent to which these factors will continue to impact our future business or operating
results, which are highly dependent on uncertain future developments, including the severity of the continuing
pandemic, the actions taken or to be taken by governments and private businesses in relation to its containment and
the resolution of supply chain issues and supply shortages. Because our business is dependent on telematics product
sales, device installations and related subscription-based services, the ultimate effect of COVID-19 and the current
supply shortages may not be fully reflected in our operating results until future periods.

We have considered all known and reasonably available information that existed throughout fiscal year 2022 in
making accounting judgements, estimates and disclosures. We are monitoring the potential effects of the health care
related and economic conditions of COVID-19 in assessing certain matters including (but not limited to) supply chain
disruptions, decreases in customer demand for our products and services, potential longer-term effects on our customer
and distribution channels particularly in the U.S. and relevant end markets as well as other developments. If the impact
results in longer term closures of businesses and economic recessionary conditions, we may recognize material asset
impairments and charges for uncollectible accounts receivable in future periods.

Transition of MRM Telematics Customers to Subscription Arrangements

In the later half of fiscal 2022, we prompted a strategic shift with customers who have historically purchased
MRM telematics devices from us. These customers are being transitioned to subscription-based arrangements by way
of bundling services with telematics devices under multi-year (generally three years) subscription contracts. Our plan
is to transitition the MRM business to multi-year subscription contracts over the course of the next year. As a result,
our financial results associated with such subscription arrangements will be reported within our Software &
Subscription Services reporting segment prospectively from the effective date of such underlying contracts. In the
short term, we expect that this will lead to significant growth in our Software & Subscription Services business with
a corresponding decline in our Telematics Products business. Long term we believe this shift will allow us to drive
revenue growth as we generate incremental revenue from our existing customer base as well as new customers through
current and anticipated broader future subscription service offerings.

Principles of Consolidation

Our consolidated financial statements include the accounts of CalAmp Corp. (a Delaware corporation) and all
of our wholly-owned subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation.

Reportable Segments

As further discussed in Note 20, Segment and Geographic Data, our two reportable segments are Software &

Subscription Services and Telematics Products.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the
United States (“U.S. GAAP”) requires us to make estimates and assumptions that affect the amounts reported in the
consolidated financial statements and accompanying notes. Actual results may differ from those estimates and
assumptions. Significant items subject to such estimates and assumptions include allowances for doubtful accounts;
charges for excess and obsolete inventory; deferred income tax asset valuation allowances; goodwill and other long-
lived assets; stock-based compensation; legal contingencies and revenue recognition. The current COVID-19
pandemic and general economic environment, and our supplier and customer concentrations also increase the degree
of uncertainty inherent in these estimates and assumptions.

Revenue Recognition

We enter into contracts with our customers to provide telematics solutions through various combinations of
platform and application subscriptions and associated telematics devices. We recognize revenue when distinct
promised goods or services are transferred to customers in an amount that reflects the consideration to which we
expect to be entitled in exchange for those goods or services. In determining revenue recognition we apply the
following five-step approach:

•

identify the contract with a customer;

identify the performance obligations in the contract;

determine the transaction price;

allocate the transaction price to the performance obligations in the contract; and

recognize revenue when (or as) we satisfy a performance obligation.

We only apply the five-step model to contracts when it is probable that we will collect the consideration we are

entitled to in exchange for goods or services we transfer to the customer.

Revenues from subscription services are recognized ratably on a straight-line basis over the term of the

subscription, which generally ranges from two to five years.

We recognize revenue from telematics product sales upon the transfer of control of promised products to
customers in an amount that reflects the transaction price. Customers generally do not have a right of return except
for defective products returned during the warranty period. We record estimated commitments related to customer
incentive programs as reductions of revenues.

From time to time, we provide various professional services to customers. These services include project
management, engineering services and installation services, which are often distinct from other performance
obligations and are recognized as the related services are performed. For certain professional service contracts, we
recognize revenue based on the proportion of total costs incurred to-date over the estimated cost of the contract, which
is an input method.

In many customer arrangements subscription services are bundled with the sale or lease of telematics devices
within the same contractual arrangement. To determine the performance obligations under these arrangements, we
assess the contractual elements and, in particular, whether the telematics products within the arrangement are distinct.
This is an area of judgment that includes the consideration of all elements of the arrangement. Significant factors in

determining whether telematics devices are distinct are whether such devices are sold separately, as well as the degree
of integration and interdependency between the subscription elements of the arrangement and the associated telematics
devices. If we conclude that the telematics devices within a customer arrangement are distinct and therefore represent
a separate performance obligation, the total expected consideration associated with the contract is allocated between
the performance obligations based upon the relative stand-alone selling price associated with each performance
obligation. We base stand-alone selling prices on pricing tables for the same or similar items.

For some customer arrangements, we have concluded that the subscription services and associated telematics
devices are not distinct performance obligations and thus represent a single combined performance obligation. For
certain other customer arrangements under which devices are leased in combination with subscription services, we
consider the arrangement to be predominately a subscription service and thus a combined single performance
obligation for purposes of revenue recognition. In both of these circumstances, we generally recognize the total
expected consideration as revenue over the term of the subscription. Device related costs associated with arrangements
in which title to the device is transferred to the customer under a single combined performance obligation are recorded
as deferred costs on the balance sheet and are amortized into cost of revenues over the term of the subscription or the
estimated in-service lives of the devices. In contractual arrangements under which we provide devices as part of the
subscription contract but we retain control of the devices, the cost of the devices is capitalized as property and
equipment and depreciated over the estimated useful life of three to five years.

As further described above under the caption Transition of MRM Telematics Customers to Subscription
Arrangements, we are in the process of transitioning our MRM customer base to subscription arrangements. This
transition may have an impact on our future determinations around contractual performance obligations as we
anticipate selling fewer telematics products that do not include related subscription services.

We exclude from the measurement of the transaction price all taxes assessed by a governmental authority that
are both imposed on and concurrent with a specific revenue-producing transaction and collected by us from a
customer.

The timing of revenue recognition may differ from the timing on our invoicing to customers. Contract assets
are comprised of unbilled amounts for which we have transferred products or provided services to our customers and
are classified as accounts receivable. Contract liabilities (deferred revenues) are comprised of billings or payments
received from our customers in advance of performance under the contract. During the fiscal year ended February 28,
2022, we recognized $32.1 million in revenue from the deferred revenue balance of $52.9 million as of February 28,
2021.

Incremental costs of obtaining a contract with a customer consist of sales commissions, which are recognized
on a straight-line basis over the life of the corresponding contracts. Prepaid sales commissions included in prepaid
expenses and other current assets and other assets were $2.0 million and $2.9 million, respectively, as of February 28,
2022.

We disaggregate revenue from contracts with customers into reportable segments, geography, type of goods and
services and timing of revenue recognition. See Note 20, Segment and Geographic Data, for our revenue by segment
and geography. The disaggregation of revenue by type of goods and services and by timing of revenue recognition is
as follows (in thousands):

Year Ended February 28/29,
2021

2020

2022

Revenue by type of goods and services:
Telematics devices and accessories
Rental income and other services
Recurring application subscriptions
Total

Revenue by timing of revenue
recognition:
Revenue recognized at a point in time
Revenue recognized over time
Total

182,916 $
19,265
93,658
295,839 $

193,486 $
17,844
97,257
308,587 $

214,374
21,587
85,812
321,773

195,399 $
100,440
295,839 $

209,902 $
98,685
308,587 $

232,971
88,802
321,773

Telematics devices and accessories revenues presented in the table above include devices sold in customer
arrangements that
include both device and subscription services. Revenues related to recurring application
subscriptions include subscription revenues as well as amortization of deferred revenue for contractual arrangements
under which the subscription services and associated telematics devices were determined to be a single combined
performance obligation.

Remaining performance obligations for Software & Subscription Services represents contracted revenue that
has not yet been recognized, which includes deferred revenue on our consolidated balance sheets and unbilled amounts
that will be recognized as revenue in future periods. As of February 28, 2022 and February 28, 2021, we have estimated
remaining performance obligations for contractually committed revenues of $202.0 million and $145.1 million
respectively. As of February 28, 2022, we expect to recognize approximately 47% of the revenue under these
remaining performance obligations in fiscal 2023 and 24% in fiscal 2024. As of February 28, 2021, we expected to
recognize approximately 50% of the then remaining performance obligations in fiscal 2022 and 22% in fiscal 2023.
We exclude contracts that have original durations of less than one year from the aforementioned remaining
performance obligation disclosure.

Cash and Cash Equivalents

We consider all highly liquid investments with maturities at date of purchase of three months or less to be cash

equivalents.

Concentrations of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash

equivalents, marketable debt securities and trade accounts receivable.

Cash and cash equivalents as well as investments are maintained with several financial institutions. Deposits
held with banks may exceed the federally insured limits. These deposits are maintained with reputable financial
institutions and are redeemable upon demand. We have not experienced any losses in such accounts.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable consists of amounts due to us from sales arrangements executed in our normal business
activities and are recorded at invoiced amounts or in some cases amounts expected to be invoiced. Our payment terms
generally range between 30 to 60 days of our invoice date with a few exceptions that extend the credit terms up to 90
days, and we do not offer financing options. We present the aggregate accounts receivable balance net of an allowance
for doubtful accounts. Generally, collateral and other security is not obtained for outstanding accounts receivable.

Credit losses, if any, are recognized based on management’s evaluation of historical collection experience, customer-
specific financial conditions as well as an evaluation of current industry trends and general economic conditions. Past
due balances are assessed by management on a periodic basis and balances are written off when the customer’s
financial condition no longer warrants pursuit of collection. Actual collections may differ from estimated amounts.

Due to the COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial
markets. Except for the increase in expected credit losses, we are not aware of any specific event or circumstances
that would require an update to our estimates or assumptions or a revision of the carrying value of our assets or
liabilities as of the date of this annual report. These estimates and assumptions may change as new events occur and
additional information is obtained. As a result, actual results could differ materially from these estimates and
assumptions.

We analyzed the credit risk associated with our accounts receivables and lease receivables. Our historical loss
rates have not shown any significant differences between customer industries or geographies, and, upon adoption of
ASU 2016-13, Financial Instruments – Credit Losses (“ASU 2016-13”), we grouped all accounts receivables and
lease receivables into a single portfolio. As described in Note 20, Segment and Geographic Data, we do not have
significant
international geographic concentrations of revenue, and as a result, we do not have significant
concentrations of accounts receivables or lease receivables in any single geography outside of the United States. As a
result of our adoption of ASU 2016-13 effective March 1, 2020, we recognized the cumulative effect of initially
applying the guidance as a $0.1 million addition to our allowance for doubtful accounts with an offsetting adjustment
to accumulated deficit.

Inventories

Inventories are stated at the lower of cost (using the first-in, first-out method) or market (net realizable value).
Inventories are reviewed for excess quantities and obsolescence based upon demand forecasts for a specific time
horizon. We record a charge to cost of revenues for the amount required to reduce the carrying value of inventory to
estimated net realizable value. Ongoing changes in cellular carrier technology, supplier changes, changes in demand
or significant reductions in product pricing may necessitate additional write-downs of inventory carrying value in the
future, which could be material.

Property and equipment

Property and equipment are recorded at cost and depreciated using the straight-line method over the respective
estimated useful lives of the assets ranging from two to seven years. Leasehold improvements are amortized using the
straight-line method over the lesser of the lease term or the estimated useful life of the assets. Maintenance and repairs
are expensed as incurred.

We capitalize certain costs incurred in connection with developing or obtaining internal-use software and
software embedded in our products. These costs are recorded as property and equipment in our consolidated balance
sheets and are amortized over useful lives ranging from three to seven years. The devices leased to our customers
under operating leases are capitalized as property and equipment and being depreciated over the life of the devices.

Business Combinations

The purchase price of an acquisition is allocated to the underlying assets acquired and liabilities assumed based
upon their estimated fair value at the date of acquisition. To the extent the purchase price exceeds the fair value of the
net identifiable tangible and intangible assets acquired and liabilities assumed, such excess is allocated to goodwill.
We determine the estimated fair values after review and consideration of relevant information, including discounted
cash flows, quoted market prices and other estimates made by management. We may refine the preliminary purchase
price allocation, as necessary, during the measurement period of up to one year after the acquisition closing date as
we obtain more information as to facts and circumstances existing at the acquisition date impacting the asset valuations
and liabilities assumed. Goodwill acquired in business combinations is assigned to the reporting unit expected to
benefit from the combination as of the acquisition date. Acquisition-related costs are recognized separately from the
acquisition and are expensed as incurred.

Goodwill and Long-lived Assets

The estimates of fair value of the reporting units are computed using either an income approach, a market
approach, or a combination of both. Under the income approach, we utilize the discounted cash flow method to
estimate the fair value of the reporting units. Significant assumptions inherent in estimating the fair values include the
estimated future cash flows, growth assumptions for future revenues (including future gross margin rates, expense
rates, capital expenditures and other estimates), and a rate used to discount estimated future cash flow projections to
their present value (or estimated fair value) based on estimated weighted average cost of capital (i.e., the selected
discount rate). We select assumptions used in the financial forecasts by using historical data, supplemented by current
and anticipated market conditions, estimated growth rates, and management’s plans. Under the market approach, fair
value is derived from metrics of publicly traded companies or historically completed transactions of comparable
businesses (i.e. guideline companies). The selection of comparable businesses is based on the markets in which the
reporting units operate giving consideration to risk profiles, size, geography, and diversity of products and services.

In the fourth quarter of fiscal 2020 and throughout fiscal 2021, we determined that the prolonged secular decline
in revenues from our legacy LoJack U.S. stolen vehicle recovery (“SVR”) products coupled with the slower than
anticipated market penetration of our telematics solutions in the U.S. automotive dealership channel represented
determinate indications of impairment. These factors were further exacerbated by the continuing unfavorable impact
that the COVID-19 pandemic has had on the automotive end markets over the past year. As a result, we initiated an
assessment of the carrying amount of the related goodwill, intangible and long-lived assets supporting these products
including the LoJack tradename and dealer and customer relationships in both fiscal years. Based upon our assessment
of economic conditions, our expectations of future business conditions and trends, our projected revenues, earnings,
and cash flows, we determined that goodwill and certain of our long-lived assets were impaired in fiscal year 2021
and 2020 as follows (in thousands):

LoJack U.S. SVR Products goodwill
Other intangible assets:
Developed technology
Tradenames
Dealer and customer relationships

Property and equipment and other assets
Operating lease right-of-use assets and related
liabilities
Total

Year Ended
February 28/29,

2021

2020

12,023 $

478
-
1,005
10,483

658
24,647 $

-
11,540
6,194
514

895
19,143

Of the above amounts, $23.8 million and $13.4 million were included in discontinued operations in the years
ended February 28/29, 2021 and 2020, respectively (see Note 2, Discontinued Operations, for additional information).

Fair Value Measurements

Our cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value due
to the short-term maturities of these items. Our marketable securities are measured at fair value on a recurring basis.

The framework for measuring fair value and related disclosure requirements about fair value measurements are
provided in ASC 820, Fair Value Measurements (ASC 820). This pronouncement defines fair value as the price that
would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the
asset or liability in an orderly transaction between market participants on the measurement date. The fair value
hierarchy proscribed by ASC 820 contains three levels as follows:

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 2 – Observable inputs other than quoted prices in active markets for identical assets or liabilities, quoted
prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be
corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Inputs that are generally unobservable and typically reflect management’s estimate of assumptions

that market participants would use in pricing the asset or liability.

Convertible Senior Notes and Capped Call Transactions

We account for our convertible senior notes as separate liability and equity components. We determine the
carrying amount of the liability component based on the estimated fair value of a similar debt instrument excluding
the embedded conversion option at the issuance date. The carrying amount of the equity component representing the
conversion option is calculated by deducting the carrying value of the liability component from the principal amount
of the notes as a whole. This difference represents a debt discount that is amortized to interest expense over the term
of the notes using the effective interest rate method. The equity component of the notes is included in stockholders’
equity and is not remeasured as long as it continues to meet the conditions for equity classification. We allocate
transaction costs related to the issuance of the notes to the liability and equity components using the same proportions

as the initial carrying value of the notes. Transaction costs attributable to the liability component are being amortized
to interest expense using the effective interest method over the respective term of the notes, and transaction costs
attributable to the equity components are netted with the equity component of the note in stockholders’ equity. We
account for the cost of the capped calls as a reduction to additional paid-in capital.

Research and Development Costs

Research and development costs are expensed as incurred. In certain cases, costs are incurred to purchase
materials and equipment for future use in research and development efforts. In such cases, these costs are capitalized
and expensed as consumed.

Product Warranty

All products have a one- to three-year limited warranty against manufacturing defects and workmanship. We
estimate the future costs relating to product returns subject to our warranty and record a reserve upon shipment of our
products. We periodically adjust our estimates for actual warranty claims, historical claims experience as well as the
impact of known product quality issues.

Patent Litigation and Other Contingencies

We accrue for patent litigation and other contingencies whenever we determine that an unfavorable outcome is
probable and a liability is reasonably estimable. The amount of the accrual is estimated based on a review of each
claim, including the type and facts of the claim and our assessment of the merits of the claim. These accruals are
reviewed at least on a quarterly basis and are adjusted to reflect the impact of recent negotiations, settlements, court
rulings, advice from legal counsel and other events pertaining to the case. Such accruals, if any, are recorded as general
and administrative expense in our consolidated statements of comprehensive loss. Although we take considerable
measures to mitigate our exposure in these matters, litigation is unpredictable; however, we believe that we have valid
defenses with respect to pending legal matters against us as well as adequate provisions for probable and estimable
losses. All costs for legal services are expensed as incurred.

Income Taxes

We use the asset and liability method when accounting for income taxes. Under this method, deferred income
tax assets and liabilities are recognized for future tax consequences attributable to the difference between the financial
statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax
credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to the
taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the
enactment date. We recognize the effect of income tax positions only if those positions are more likely than not to be
sustained. Changes in recognition or measurement are reflected in the period in which the change in judgement occurs.
We recognize interest and/or penalties related to uncertain tax positions in income tax expense. Valuation allowances
are provided against net deferred tax assets when it is determined that it is more likely than not that the assets will not
be realized. In assessing valuation allowances, we review historical and future expected operating results and other
factors, including cumulative earnings experience, expectations of future taxable income by jurisdiction and the
carryforward periods available for reporting purposes.

In the fourth quarter of fiscal 2020, management assessed the available positive and negative evidence to
estimate whether sufficient future taxable income will be generated to permit the use of the existing net deferred tax
assets. Due to the decrease in profitability, three-year cumulative loss position considering forecasts of future
profitability and weighing all other positive and negative objective evidence, we determined that it was more likely
than not that our domestic net deferred tax assets will not be realized, as such a valuation allowance against our
domestic net deferred tax assets was established during the three months ended February 29, 2020. In fiscal 2022, we
maintained a valuation allowance with respect to certain of our domestic and foreign deferred tax assets. The amount
of the deferred tax assets considered realizable, however, could be adjusted in future periods in the event sufficient
evidence is present to support a conclusion that it is more likely than not that all or a portion of our domestic deferred
tax assets will be realized.

Foreign Currency Translation

We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiaries into U.S. dollars
using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated
using rates that approximate those in effect during the period. Gains and losses from these translations are recognized
in foreign currency translation included in accumulated other comprehensive loss during the period. The aggregate
foreign currency transaction exchange rate losses included in determining loss from continuing operations before
income taxes were $0.2 million, $0.2 million and $0.2 million in fiscal years 2022, 2021 and 2020, respectively.

Stock-Based Compensation

Our stock-based compensation expense resulting from grants of employee stock options, restricted stock and
restricted stock units is recognized in the consolidated financial statements based on the respective grant date fair
values of the awards. We use the Black-Scholes option-pricing method for valuing stock options and shares granted
under the employee stock purchase plan and recognize the expense over a requisite service (vesting) period using the
straight-line method. Restricted stock units (RSUs), are valued based on the fair value of our common stock on the
date of grant. The measurement of stock-based compensation is based on several criteria such as the type of equity
award, the valuation model used and associated input factors including the expected term of the award, stock price
volatility, risk free interest rate and forfeiture rate. Certain of these inputs are subjective and are determined based in
part on management's judgment. We account for forfeitures as they occur, rather than estimating expected forfeitures
over the course of a vesting period.

Other Comprehensive Income (Loss)

Other comprehensive income (loss) consists of two components, net income (loss) and other comprehensive
income (loss) (“OCI”). OCI refers to revenue, expenses and gains and losses that under U.S. GAAP are recorded as
an element of stockholders’ equity and excluded from net income (loss). Our OCI consists of foreign currency
translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency.

Recently Issued Accounting Standards Not Yet Adopted

In August 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-06, Debt with
Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity
(Subtopic 815-40), which removes certain separation models for convertible debt instruments and convertible
preferred stock that require the separation of a convertible debt instrument into a debt component and an equity or
derivative component. The ASU also expands disclosure requirements for convertible instruments and simplifies areas
of the guidance for diluted earnings-per-share calculations that are impacted by the amendments. The standard is
effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted. We expect
the primary impacts of this new standard will be to increase the carrying value of the convertible notes and reduce our
reported interest expense. In addition, we will be required to use the if-converted method for calculating diluted
earnings per share.

Recently Adopted Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for
Income Taxes. This ASU removes certain exceptions for recognizing deferred taxes for investments, performing
intraperiod allocation, and calculating income taxes in interim periods. This ASU also adds guidance to reduce
complexity in certain areas, including recognizing deferred taxes for goodwill and allocating taxes to members of a
consolidated group. The updated guidance is effective for fiscal years, and interim periods within those fiscal years,
beginning after December 15, 2020 with early adoption permitted. Effective March 1, 2021, the Company adopted
ASU 2019-12. This pronouncement did not have a significant impact on our consolidated financial statements upon
adoption.

NOTE 2 – DISCONTINUED OPERATIONS

Effective March 15, 2021, a wholly owned subsidiary of the Company and Spireon entered into an agreement
(“Sale Agreement”) pursuant to which we sold certain assets and transferred certain liabilities of the LoJack North
America business (“LoJack Transaction”) for an upfront cash purchase price of approximately $8.0 million. We
received net proceeds of $6.6 million, based on an estimate of certain adjustments to the gross purchase price as of
the closing date. On November 9, 2021, the purchase price was reduced by $0.9 million, which was paid to Spireon,
due to final working capital adjustments. No further adjustments to the purchase price are expected. We recognized a
gain on the sale of the LoJack North America business of $4.1 million during the year ended February 28, 2022.

Concurrent with the closing of the transaction, we also entered into a Transition Services Agreement (the
“TSA”) to provide support to Spireon in the transition of customers to its telematics solution and to provide recovery
services to the existing installed base of LoJack North America customers, as an agent of Spireon, for a period of six
months commencing March 15, 2021. Subsequently, the transition period was extended and is expected to conclude
in the first quarter of Fiscal 2023. As consideration for these services, Spireon is reimbursing us for the direct and
certain indirect costs, as well as certain overhead or administrative expenses related to operating the business.
Additionally, we entered into a services agreement to commence upon the expiration of the TSA under which we will
provide certain services related to the LoJack North America tower infrastructure for a period no longer than fifty-
four months. As consideration for these services, Spireon will pay us a monthly service fee over the stipulated contract
term. Further, we entered into a license agreement pursuant to which we license certain intellectual property rights
related to the LoJack North America business in the U.S. and Canada to Spireon. In connection with the transition
services provided to Spireon during the year ended February 28, 2022, we incurred a total cost of $4.4 million of
which $2.3 million was billed to Spireon for the services under the TSA and the net amount of remaining
of $2.1 million was included as a component of other expense in the consolidated statements of comprehensive loss
as these costs represent non-operating expenses.

We have concluded that the LoJack North America operations are discontinued operations as the asset group
represents a component of an entity, the component meets the criteria of held for sale as of February 28, 2021, and the
disposal represents a strategic shift. As a result, certain items were reclassified as part of discontinued operations for
comparative purposes. The below table presents the amounts by balance sheet classification related to our discontinued
operations (in thousands):

As of February 28,
2021

Carrying amounts of the major classes of assets included in discontinued
operations:

Accounts receivable, net
Inventories
Prepaid expenses and other current assets

Total assets

Carrying amounts of the major classes of liabilities included in discontinued
operations:

Accounts payable
Deferred revenue
Other current liabilities

Current liabilities of discontinued operations

Other non-current liabilities

Total liabilities

5,050
1,721
1,101
7,872

1,956
1,849
291
4,096
1,773
5,869

The amounts in the statement of operations that are included in discontinued operations are summarized in the

following table (in thousands):

Revenues
Cost of revenues
Gross profit
Operating expenses:

Research and development
Selling and marketing
General and administrative
Intangible asset amortization
Restructuring
Impairment losses

Total operating expenses

Operating loss from discontinued operations
Gain on sale of discontinued operations
Net income (loss) from discontinued operations, net of tax $

Year Ended February 28/29
2021

2020

2022

823 $
950
(127)

32
167
75
141
404
-
819
(946)
4,103
3,157 $

32,692 $
21,133
11,559

1,441
9,988
7,041
2,199
2,220
23,822
46,711
(35,152)
-

(35,152) $

44,334
26,524
17,810

2,443
13,155
8,190
6,450
1,935
13,389
45,562
(27,752)
-
(27,752)

The amounts in the statement of cash flow that are included in discontinued operations are summarized in the

following table (in thousands):

Year Ended February 28/29
2021

2020

2022

3,157 $

(35,152) $

(27,752)

-
141
25
-
(4,103)
-

452
425
4
(331)
(135)
(30)
-

(395)

-
5,721

5,721
5,326

2,260
2,199
1,516
23,822
-
4,901

2,584
2,585
(123)
(1,859)
(1,363)
(428)
(5,354)

(4,412)

(2,338)
-

(2,338)
(6,750)

2,225
6,450
1,754
14,599
-
3,360

2,053
2,456
2,376
1,158
(627)
(70)
(3,275)

4,707

(891)
-

(891)
3,816

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) from discontinued operations, net of tax
Adjustments to reconcile net income (loss) from
discontinued operations to net cash provided by (used in)
operating activities:

Depreciation
Intangible asset amortization
Stock-based compensation
Impairment losses
Gain on sale of discontinued operations
Noncash operating lease cost
Changes in operating assets and liabilities:

Accounts receivable
Inventories
Prepaid expenses and other current assets
Accounts payable
Accrued liabilities
Deferred revenue
Operating lease liabilities

NET CASH PROVIDED BY (USED IN) OPERATING
ACTIVITIES FROM DISCONTINUED OPERATIONS
CASH FLOWS FROM INVESTING ACTIVITIES:

Capital expenditures
Net proceeds from sale of discontinued operations
NET CASH PROVIDED BY (USED IN) INVESTING
ACTIVITIES FROM DISCONTINUED OPERATIONS
Net change in cash and cash equivalents

NOTE 3 – ACQUISITIONS

We acquired LoJack Mexico and Synovia in March 2019 and April 2019, respectively. The following are the

final purchase price allocations as of February 29, 2020 for the two acquisitions (in thousands):

Purchase price
Add debt paid at closing
Less cash acquired, net of debt assumed

Net cash paid

Add previously held interest
Fair value of net assets and liabilities assumed:

Current assets other than cash
Property and equipment
Customer relationships
Trade name
Developed technology
Deferred tax assets
Other non-current assets
Current liabilities
Due to factors
Deferred revenue
Deferred tax liability

LoJack Mexico

14,306
-
(1,586)
12,720
2,021

4,537
3,652
7,000
-
-
-
1,301
(2,586)
-
(4,507)
(943)

Synovia

29,500
20,296
(889)
48,907
-

9,637
24,840
16,700
1,600
3,800
2,061
177
(4,645)
(19,692)
(4,319)
-

Total fair value of net assets acquired

Goodwill

8,454
6,287

30,159
18,748

We paid a premium (i.e., goodwill) over the fair value of the net tangible and identified intangible assets acquired
for the two acquisitions as we believe the extensive customer relationships with these businesses will expand our fleet
management and vehicle safety services portfolio and increase our customer reach by gaining access to a base of high-
value and low-churn subscribers in those geographic regions.

We incurred acquisition-related costs of approximately $1.1 million for the acquisition of these entities in fiscal
2020. These costs were primarily legal expenses, which were recorded as part of our general and administrative
expenses.

Pro forma financial information for the fiscal year ended February 29, 2020 for the acquired companies is not

disclosed as the results are not material to our consolidated financial statements.

LoJack Mexico

On March 19, 2019, we acquired LoJack Mexico, the exclusive licensee of LoJack technology for the Mexican
market. LoJack Mexico leverages our telematics and software-as-a-service solutions to expand product offering to its
substantial subscriber base as well as serve auto dealers and OEMs, insurance providers and leasing companies
throughout Mexico. We purchased the remaining 87.5% of LoJack Mexico shares that we did not own for a cash
purchase price of $14.3 million. Our previously held 12.5% equity interest in LoJack Mexico was determined to have
a fair value of $2.0 million at acquisition date which resulted in a gain of $0.3 million, which was recorded as
investment income in our consolidated statements of comprehensive loss for the fiscal year ended February 29, 2020.
LoJack Mexico is consolidated with our financial statements effective March 19, 2019 as a component of our Software
& Subscription Services reportable segment.

The goodwill arising from the acquisition of LoJack Mexico is not deductible for income tax purposes.

Synovia

On April 12, 2019, we acquired Synovia, a North American market leader in fleet safety and management for
K-12 school bus and state and local government fleets, for a total cash purchase price of $49.8 million. The Synovia
acquisition expands our fleet management and vehicle safety services portfolio as well as accelerates our
transformation to high-value subscription based services. Synovia is consolidated with our financial statements
effective April 12, 2019 as a component of our Software & Subscription Services reportable segment.

The goodwill arising from the acquisition of Synovia is deductible for income tax purposes.

NOTE 4 – CONCENTRATION OF CUSTOMERS AND SUPPLIERS

Significant Customers

We sell telematics products to large global enterprises in the industrial equipment, telecommunications and
automotive market verticals. One customer accounted for 18%, 19% and 16% of our revenue and 12%, 25% and 21%
of our accounts receivable as of and for the years ended February 28/29, 2022, 2021 and 2020, respectively.

Significant Suppliers

We purchase a significant amount of our inventory from certain manufacturers or suppliers including
components, assemblies and electronic manufacturing parts. These suppliers are located in Mexico and Asia, including
China. The inventory is purchased under standard supply agreements that outline the terms of the product delivery.
The title and risk of loss of the product generally pass to us upon shipment from the manufacturers’ plant or warehouse.
Some of these manufacturers accounted for more than 10% of our purchases and accounts payable as follows:

Year Ended February 28/29,
2021

2020

2022

Inventory purchases:

Supplier A
Supplier B
Supplier C
Supplier D

Accounts Payable:
Supplier A
Supplier B
Supplier C

14%
13%
15%
10%

20%
14%
10%
22%

As of February 28/29,
2021

2020

2022

3%
15%
11%

17%
11%
8%

11%
2%
12%
27%

13%
10%
12%

We are currently reliant upon these suppliers for products. Although we believe that we can obtain products
from other sources, the loss of a significant supplier could have a material impact on our financial condition and results
of operations as the products that are being purchased may not be available on the same terms from another supplier.

NOTE 5 – CASH, CASH EQUIVALENTS AND INVESTMENTS

The following tables summarize our financial instrument assets (in thousands):

As of February 28, 2022

Unrealized
Gains
(Losses)

Fair
Value

Cost

Balance Sheet Classification of
Fair Value

Cash and
Cash
Equivalents

Other
Assets

Cash
Level 1:

Money market funds
Mutual funds (1)

Level 2:

Repurchase agreements

Total

28,394 $

- $

28,394 $

7,327
851

-
107

7,327
958

7,327
-

43,500
80,072 $

-
107 $

43,500
80,179 $

43,500
79,221 $

-
958

As of February 28, 2021

Unrealized
Gains
(Losses)

Fair
Value

Cost

Balance Sheet Classification of
Fair Value

Cash and
Cash
Equivalents

Other
Assets

Cash
Level 1:

Money market funds
Mutual funds (1)

Level 2:

Repurchase agreements

Total

38,823 $

- $

38,823 $

12,801
1,810

-
367

12,801
2,177

12,801
-

43,000
96,434 $

-
367 $

43,000
96,801 $

43,000
94,624 $

-
2,177

(1) Amounts represent various equities, bonds and money market mutual funds held in a “Rabbi Trust” and are
restricted for payment obligations to non-qualified deferred compensation plan participants. In addition to
the mutual funds above, our “Rabbi Trust” also included Corporate-Owned Life Insurance (COLI) starting
in fiscal 2020. As of February 28, 2022, the cash surrender value of COLI was $6.2 million. See Note 10
for discussion of the deferred compensation plan.

NOTE 6 – ACCOUNTS RECEIVABLE

Accounts receivable consist of the following (in thousands):

Accounts receivable
Allowance for doubtful accounts

February 28,

2022

2021

64,190 $
(2,646)
61,544 $

66,983
(3,658)
63,325

NOTE 7 – INVENTORIES

Inventories consist of the following (in thousands):

Raw materials
Finished goods

February 28,

2022

2021

6,090 $

12,179
18,269 $

10,480
13,183
23,663

NOTE 8 – PROPERTY AND EQUIPMENT

Property and equipment consist of the following (in thousands):

Leasehold improvements
Recovery system components and law
enforcement tracking units
Leased devices
Plant equipment and tooling
Office equipment, computers and
furniture
Software

Less accumulated depreciation and
amortization

Fixed assets not yet in service

Useful

Life

5 - 10 years $
7 to 10 years

2 to 5 years
2 - 5 years
3 - 5 years

3 - 7 years

February 28,

2022

2021

6,853 $

7,924

940
33,632
8,960

8,555
40,885
99,825

(65,615)
34,210
3,464
37,674 $

13,975
31,988
9,789

12,438
49,993
126,107

(88,870)
37,237
3,844
41,081

Depreciation expense from continuing operations was $17.4 million, $17.2 million and $17.4 million for the

fiscal years ended February 28/29, 2022, 2021 and 2020, respectively.

A portion of the recovery system components and law enforcement tracking units above represent the software
development for and equipment attached to our tower infrastructure. During fiscal year ended February 28, 2021, we
recorded impairment losses aggregating $9.0 million, which represented the net book value of property and equipment
substantially related to the LoJack U.S. SVR operations. Impairment losses of $8.9 million for the fiscal year ended
February 28, 2021 are included within the net loss from discontinued operations shown separately in our consolidated
statement of comprehensive loss.

Fixed assets not yet in service consist primarily of capitalized internal-use software and certain tooling and other

equipment that have not been placed into service.

NOTE 9 – GOODWILL AND OTHER INTANGIBLE ASSETS

Changes in goodwill are as follows (in thousands):

Software &
Subscription
Services

Telematics
Products

Balance as of February 28, 2021
Effect of exchange rate change on goodwill
Balance as of February 28, 2022

55,437 $
(181)
55,256 $

39,180 $
-
39,180 $

Total

94,617
(181)
94,436

As further described in Note 1 Description of Business and Summary of Significant Accounting Policies, we
have begun entering into subscription arrangements with customers who have historically purchased MRM telematics
products from us, which is expected to result in growth in Software & Subscription Services revenues and a
corresponding decline in Telematics Products revenues as we transition the MRM telematics business to long-term
subscription contracts. This transition is expected to be completed over the course of Fiscal 2023. As a result of this
strategic shift, we anticipate that the goodwill presently associated with our Telematics Products reporting unit will
be re-allocated to our other reporting units in Fiscal 2023 at such time that this customer transition is substantially
complete.

Other intangible assets are comprised as follows (in thousands, except years):

Useful
Life

Feb. 28,
2021

Gross (2)
Additions &
Adjustments,
net (1)

Accumulated Amortization (2)

Net

Feb. 28,
2022

Feb. 28,
2021

Amortization
Expense

Feb. 28,
2022

Feb. 28,
2021

Feb. 28,
2022

Developed technology 4-6

Tradenames

years
10
years
Customer relationships 10-15
years
5 years

Patents

$26,994

(36) $26,958 $24,057

1,413 $25,470 $ 2,937 $ 1,488

30,257

(65) 30,192 18,428

2,143

20,571

11,829

9,621

35,270
589
$93,110 $

134
-

35,404 12,902
235

589

33 $93,143 $55,622 $

1,981
19

14,883
254

20,521
335
5,556 $61,178 $37,488 $31,965

22,368
354

(1) Amounts also include any net changes in intangible asset balances for the periods presented that resulted from

foreign currency translation.

(2) This table excludes the gross value of fully amortized intangible assets totaling $23.0 million at February 28,

2022 and February 28, 2021.

Intangible assets with finite lives are amortized on a straight-line basis over the expected period to be benefited
by future cash flows. We monitor and assess these assets for impairment on a periodic basis. Our assessment includes
various new product lines and services, which leverage the existing intangible assets as well as consideration of
historical and projected revenues and cash flows. In both fiscal 2021 and 2020, we determined that the prolonged
secular decline in legacy LoJack US SVR products revenue coupled with the slower than anticipated market
penetration of our telematics solutions in the U.S. automotive dealership channel represented determinate indications
of impairment. As a result, we performed an assessment of the carrying amount of the related intangible assets
supporting these products including the LoJack tradename and dealer and customer relationships. Our assessment of
the future cash flows generated by these assets concluded that an impairment loss was present. For the fiscal year
ended February 28, 2021, we recorded an impairment loss aggregating $1.5 million, which was attributable to $1.0
million of US Dealer relationships and $0.5 million of developed technology. For the fiscal year ended February 29,
2020, we recorded an impairment loss aggregating $17.7 million, which was attributable to $11.5 million of the LoJack
Tradename and $6.2 million of US Dealer relationships. Approximately, $1.5 million and $12.0 million of these
impairment losses are included within net loss from discontinued operations for fiscal years ended February 28/29,
2021 and 2020, respectively.

Amortization expense of intangible assets from continuing operations was $5.4 million, $4.8 million and $5.9

million in fiscal years ended February 28/29, 2022, 2021 and 2020, respectively.

Estimated future amortization expense as of February 28, 2022 is as follows (in thousands):

5,416
4,572
4,457
4,147
2,526
10,847
31,965

2023
2024
2025
2026
2027
Thereafter

NOTE 10 – OTHER ASSETS

Other assets consist of the following (in thousands):

February 28,

2022

2021

Deferred product cost
Deferred compensation plan assets
Lease receivables, non-current
Prepaid commissions
Other

1,493 $
7,215
15,118
2,894
2,912
29,632 $

4,850
7,141
10,403
2,438
2,337
27,169

We have a non-qualified deferred compensation plan in which certain members of management and all non-
employee directors are eligible to participate. Participants may defer a portion of their compensation until retirement
or another date specified by them in accordance with the plan. We are funding the plan obligations through cash
deposits to a Rabbi Trust that are invested in various equity, bond, COLI and money market mutual funds in generally
the same proportion as investment elections made by the participants. The deferred compensation plan liability is
included in other non-current liabilities in the accompanying consolidated balance sheets.

NOTE 11 – FINANCING ARRANGEMENTS

Balances attributable to our financing arrangements consist of the following (in thousands):

2025 Convertible Notes, 2.00% fixed rate
Due to factors under revenue assignments

Total term debt

Unamortized discount and issuance costs
Less: current portion of long-term term
debt

Long-term debt, net of current portion

Maturity
Date
August 1, 2025
2020 - 2024

Effective
Interest Rate
7.56%
4.70%

February 28,

2022

2021

230,000
3,829
233,829
(41,541)

(2,585)
189,703 $

230,000
8,081
238,081
(51,610)

(4,317)
182,154

The effective interest rates for the convertible notes include the interest on the notes and debt discount. As of
February 28, 2022 and 2021, the fair value of the convertible notes, based on Level 2 inputs, was $209 million and
$212 million, respectively.

Revolving Credit Facility

On March 30, 2018, we entered into a revolving credit facility with J.P. Morgan Chase Bank that provides for
borrowings of up to $50 million and was set to expire on March 30, 2022. We have entered into an amendment to
extend the term of this credit facility to June 30, 2022 and are presently in negotiations to enter into a new revolving
credit facility. At our election, the borrowings under this revolving credit facility bear interest at (a) for base rate loans,
a base rate based on the highest of (i) 0%, (ii) the rate of interest publicly announced by JP Morgan Chase Bank, N.A.
(the “Agent”) as its prime rate in effect at its principal office in New York City, (iii) the overnight bank funding rate
as determined by the Federal Reserve Bank of New York plus 0.50% and (iv) the LIBOR-based rate for a one-month
interest period on such day plus 1%; or (b) for Eurodollar loans, the higher of (x) 1.00% and (y) the LIBOR-based
rate for one, three or six months (as selected by the Company) for Eurodollar deposits. An applicable margin is added
based on the Company’s senior leverage ratio, ranging from 1.50% to 2.00% for base rate loans, and from 2.50% to
3.00% for Eurodollar loans. We will also pay a commitment fee based on our senior leverage ratio ranging from 0.40%
to 0.50%, payable quarterly in arrears, on the average daily unused amount of the Credit Facility. Amounts owing
under the credit agreement and related credit documents are guaranteed by the Company and certain of its subsidiaries.
We have also granted security interests in substantially all of our respective assets to secure these obligations. The net
proceeds available under the revolving credit facility can be used for repayment of existing debt, working capital and
general corporate purposes. In May 2020, we borrowed $20 million under the revolving credit facility, which was
fully repaid with the accrued interest of $0.1 million on November 19, 2020. There were no borrowings outstanding
under this revolving credit facility at February 28, 2022.

The revolving credit facility contains certain negative and affirmative covenants including financial covenants
that require us to maintain a minimum level of earnings before interest, income taxes, depreciation, amortization and
other non-cash charges (Adjusted EBITDA) to interest ratio, a minimum senior indebtedness ratio and a total
indebtedness coverage ratio, all measured on a quarterly basis. As of February 28, 2022, we were in violation of the
total indebtedness coverage ratio covenant under the revolving credit facility. However, as noted above, there were no
borrowings outstanding under this revolving credit facility at February 28, 2022, and we are presently in negotiations
to enter into a new revolving credit facility.

Convertible Senior Unsecured Notes

We have $230.0 million aggregate principal amount of convertible senior unsecured notes due in August 2025
(“2025 Convertible Notes”). The notes are carried at their principal face amount, less unamortized debt discount and
issuance costs, and are not carried at fair value at each period end.

Accounting guidance requires that convertible debt that can be settled for cash be separated into the liability and
equity component at issuance and each be assigned a value. The value assigned to the liability component is the
estimated fair value, as of the issuance date, of a similar debt without the conversion feature. The difference between
the principal amount of the debt and the estimated fair value of the liability component, representing the value of the
embedded conversion option assigned to the equity component, is recorded as a debt discount on the issuance date.
The fair value of the liability component is generally determined using a discounted cash flow analysis, in which the
projected interest and principal payments are discounted back to the issuance date at a market interest rate that
represents a Level 3 fair value measurement. The debt discount is amortized to interest expense using the effective
interest method with an effective interest rate equal to the aforementioned market interest rate over the term of the
debt. The remaining gross proceeds net of the liability component represents the fair value of the embedded conversion
feature that was recorded as an increase in additional paid-in capital within the stockholders’ equity section. The
associated deferred tax effect was recorded as a reduction of additional paid-in capital. The amounts recorded in
additional paid-in capital is not to be remeasured as long as the embedded conversion option continues to meet the
conditions for equity classification. As of February 28, 2022, the embedded conversion option continues to meet the
conditions for equity classification.

Further, the issuance costs related to the debt are also allocated to the liability and equity components based on
the relative fair values. Issuance costs attributable to the liability component were recorded as a direct deduction from
the carrying value of the debt and are being amortized to expense over the term of the debt using the effective interest
method. The issuance costs attributable to the equity component were recorded as a charge to the additional paid-in
capital within stockholders’ equity. Lastly, the deferred tax effect related to the equity component of the issuance costs
was also recorded to additional paid-in capital as such costs are deductible for tax purposes.

The table below summarizes the liability and equity components of the 2025 Convertible Notes, the issuance
costs and the applicable assumptions used for the calculation (in millions except initial conversion rate and per share
amounts):

Initial conversion rate (shares per $1,000 principal amount)
Initial conversion price per share

Fair value of liability component upon issuance
Fair value measurement level
Fair value of embedded equity component upon issuance
Deferred tax asset effect

Total issuance cost
Equity component
Deferred tax asset effect

2020 Convertible Notes

$
$

$
$
$

32.5256
30.7450

160.8
Level 3
69.2
17.3

7.3
2.2
0.5

In May 2015, we issued $172.5 million aggregate principal amount convertible notes that were senior unsecured
obligations and with interest at a rate of 1.625% per year payable in cash on May 15 and November 15 of each year
(“2020 Convertible Notes”).

In July 2018, we entered into separate, privately negotiated purchase agreements to repurchase approximately
$50 million in aggregate principal amount of our 2020 Convertible Notes for $53.8 million including accrued interest,
by using a portion of the net proceeds from the 2025 Convertible Notes. The repurchase was accounted for as an
extinguishment of debt, not a modification of debt. We allocated the repurchase price of $53.7 million between the
fair value of the liability of $47.6 million and the equity component of $6.1 million. The fair value of the liability
component was determined using a discounted cash flow analysis at a market interest rate for nonconvertible debt of
4.36% based on the remaining maturity of the 2020 Convertible Notes, which represented a Level 3 fair value
measurement. The carrying value of the repurchased notes was $45.6 million, resulting in a loss on extinguishment of
debt of $2.0 million. We also received proceeds of $3.1 million from the unwinding of the note hedge and warrants,
which was recorded as additional paid-in capital.

In October and November 2019, we entered into separate, privately negotiated purchase agreements to
repurchase approximately $94.9 million in aggregate principal amount of these notes for $94.7 million. The repurchase
is accounted for as an extinguishment of debt. The entire repurchase price of $94.7 million was considered as the fair
value of the liability as the equity component was de minimis. The fair value of the liability was determined using a
discounted cash flow analysis at a market interest rate for nonconvertible debt based on the remaining maturity of the
2020 Convertible Notes, which represented a Level 3 fair value measurement. The carrying value of the repurchased
notes was $92.3 million, resulting in a loss on extinguishment of debt of $2.4 million. On May 15, 2020, we repaid
the remaining principal balance of $27.6 million of the 2020 Convertible Notes.

2025 Convertible Notes

On July 20, 2018, we issued $230.0 million aggregate principal amount of the 2025 Convertible Notes. These
notes were issued under an indenture, dated July 20, 2018 between us and The Bank of New York Mellon Trust
Company, N.A., as trustee.

The proceeds from the sale of the 2025 Convertible Notes were $222.7 million, after deducting issuance costs
of $7.3 million. We initially used approximately $90.0 million of the net proceeds from this offering to (i) pay the cost
of the capped call transactions of $21.2 million; (ii) repurchase shares of our common stock of approximately $15.0
million; and (iii) repurchase in privately negotiated transactions approximately $50 million principal of our
outstanding 2020 Convertible Notes for approximately $53.8 million.

The 2025 Convertible Notes contain customary terms and conditions, including that upon certain events of
default occurring and continuing, either the trustee, by notice to us, or the holders of at least 25% in aggregate principal
amount of the then outstanding Notes, by notice to us and the trustee, may declare the principal amount of, and all
accrued and unpaid interest on, all of the 2025 Convertible Notes then outstanding to become due and payable
immediately. Such events of default include, without limitation, the default by us or any of our subsidiaries with
respect to indebtedness for borrowed money in excess of $10 million and the entry of judgments for the payment of
$15 million or more against us or any of our subsidiaries, which are not paid, discharged or stayed within 60 days.

The 2025 Convertible Notes bear interest at 2.00% per year payable semiannually in arrears in cash on February
1 and August 1 of each year, beginning on February 1, 2019. The 2025 Convertible Notes will mature on August 1,
2025, unless earlier converted, redeemed or repurchased by us in accordance with their terms. We may redeem the
Notes at our option at any time on or after August 6, 2022 at a cash redemption price equal to the principal amount
plus accrued interest, but only if the last reported sale price per share of our stock exceeds 130% of the conversion
price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending
on, and including, the trading day immediately before the date we send the related redemption notice; and (ii) the
trading day immediately before the date we send such notice. The 2025 Convertible Notes rank senior in right of
payment to any existing or future indebtedness which is subordinated by its terms, ranks equally in right of payment
to any indebtedness that is not so subordinated, is structurally subordinated to all indebtedness and liabilities of our
subsidiaries and is effectively junior to our secured indebtedness to the extent of the value of the assets securing such
indebtedness.

The 2025 Convertible Notes are convertible into cash, shares of our common stock or a combination of both, at
our election, based on an initial conversion rate and initial conversion price as noted above. Holders may convert their
2025 Convertible Notes at their option upon the occurrence of certain events, as defined in the indenture.

Upon the occurrence of a “make-whole fundamental change”, we will in certain circumstances increase the
conversion rate for a specific period of time. Additionally, upon the occurrence of a “fundamental change”, holders
of the notes may require us to repurchase their notes at a cash repurchase price equal to the principal amount of the
notes to be repurchased, plus any accrued and unpaid interest. As of February 28, 2022, none of the conditions
allowing the holders of the 2025 Convertible Notes to convert have been met.

In July 2018, in connection with the 2025 Convertible Notes, we entered into capped call transactions with
certain option counterparties who were initial purchasers of the 2025 Convertible Notes. The capped call transactions
are expected to reduce the potential dilution of earnings per share upon conversion of the 2025 Convertible Notes.
Under the capped call transactions, we purchased options that in the aggregate relate to the total number shares of 7.48
million shares of common stock underlying the notes, with a strike price equal to the conversion price of the notes and
with a cap price equal to $41.3875. We paid $21.2 million for the note hedges and as a result, approximately $15.9
million, net of tax, was recorded as a reduction to additional paid-in capital within stockholders’ equity.

We elected to integrate the note hedges and capped call with the Notes for federal income tax purposes pursuant
to applicable U.S. Treasury Regulations. Accordingly, the cost of the note hedges and capped call will be deductible
for income tax purposes as original issue discount interest over the term of Notes.

Synovia Revenue Assignments

In conjunction with the acquisition of Synovia on April 12, 2019, we assumed the rights and obligations under
certain revenue assignment arrangements with several financial institutions (the “Factors”). Pursuant to the terms of
the arrangements, Synovia sold to the Factors rights to all future revenues of certain subscription contracts on a non-
recourse basis for credit approved accounts. The sales price paid represents a percentage of the total contract value
(generally 80%) due to Synovia at the beginning of the contract, with the total customer contract balance to be paid
by the customers to the Factors over the contract period. The cost of the transaction was recorded as a contra-liability,
and was recognized as interest expense over the term of the subscription contract using the effective interest method,
while the assigned customer obligation is amortized to subscription revenues using the straight-line method.

These arrangements with the Factors met the criteria in ASC 470-10-25, Sales of Future Revenues or Various
Other Measures of Income (“ASC 470”), which relates to cash received from an investor in exchange for a specified
percentage or amount of revenue or other measure of income of a contractual right for a defined period. Under this
guidance, the arrangement qualified as a debt instrument for accounting purposes due to Synovia’s significant
continuing involvement in the generation of cash flows due to the Factors. Further, under ASC 805, Business
Combination, we recorded the amounts due to the Factors as a debt obligation at fair value in the opening balance
sheet and the outstanding amount is presented as part of our long-term debt in our consolidated balance sheet. The fair
value of this debt of $19.7 million was determined using a pre-tax cost of debt of 4.7% at the time of our acquisition
of Synovia. The discount of $1.5 million will be amortized under the interest method. During the fiscal year ended
February 28/29, 2022, 2021 and 2020, we recognized $0.2 million, $0.5 million and $0.7 million of interest expense
related to this debt, respectively. The non-cash revenues recognized from this arrangement of $4.6 million, $6.3
million and $6.8 million are included as a non-cash activity in our consolidated statements of cash flows for fiscal
year ended February 28/29, 2022, 2021 and 2020, respectively.

Paycheck Protection Program

NOTE 12 – RESTRUCTURING CHARGES

In fiscal 2019, we commenced a plan (the “Plan”) to capture certain synergies and cost savings related to
streamlining our global operations and sales organization, as well as rationalize certain leased properties that were not
fully occupied. Our Plan is aligned with our strategy to integrate the global sales organization and further outsource
manufacturing functions in order to drive operational efficiency, increase supplier geographic diversity, and reduce
operating expenses. To date, total restructuring charges are $17.9 million, comprised primarily of $11.1 million in
severance and employee related costs, and $6.8 million for vacant office and manufacturing facility as well as
terminated tower infrastructure leases. Restructuring charges related to vacant office and manufacturing facility space
were due primarily to the vacancy in Canton, Massachusetts of $3.3 million. Substantially all charges related to
severance and employee costs were under the Telematics Products reportable segment.

The following table summarizes the charges resulting from the implementation of the restructuring plan for the

fiscal years ended February 28/29, 2022, 2021 and 2020 (in thousands):

Cost of revenue
Research and
development
Selling and
marketing
General and
administrative
Total

Years ended February 28/29,
2021
Personnel Facilities Total Personnel Facilities Total Personnel Facilities Total
1,853 $2,346
$

850 $ 1,380 $

493 $

218 $

376 $

530 $

594 $

2020

2022

247

100
622 $

247

106

382 $ 1,004 $

820

2,521
3,904 $

820

2,521

850 $ 4,754 $

222

601

222

601

1,231
2,547 $

1,231
1,853 $4,400

Total restructuring charges of $0.4 million, $2.2 million, and $1.9 million for fiscal years ended February 28/29,

2022, 2021 and 2020 were included as part of the discontinued operations, respectively.

The following table summarizes the activity resulting from the implementation of the restructuring plan within

other current and non-current liabilities (in thousands):

Personnel

Facilities

Total

Restructuring liabilities as of February 29, 2020
Charges
Payments
Restructuring liabilities as of February 28, 2021
Charges
Payments
Restructuring liabilities as of February 28, 2022

2,383 $
3,905
(3,651)
2,637 $
622
(3,129)

130 $

359 $
850
(318)
891 $
382
(424)
849 $

2,742
4,755
(3,969)
3,528
1,004
(3,553)
979

The restructuring liabilities related to personnel were included in accrued payroll and employee benefits in our

consolidated balance sheets as of February 28, 2022 and 2021.

NOTE 13 – LEASES

On March 1, 2019, we adopted ASC 842, Leases. We applied the transition requirements on the adoption date,
rather than at the beginning of the earliest comparative period presented. In addition, we elected the package of
practical expedients permitted under the transition guidance, which does not require reassessment of prior conclusions
related to contracts containing a lease, lease classification and initial direct lease costs. As an accounting policy
election, we excluded short-term leases (term of 12 months or less) from the balance sheet presentation and accounted
for non-lease and lease components in a contract as a single lease component for certain asset classes.

We have various non-cancelable operating leases for our offices in California, Texas, Massachusetts, Indiana
and Minnesota in the United States, and Italy, Mexico and the United Kingdom. We also have various non-cancelable
operating leases for towers and vehicles throughout the United States, Italy and Mexico. These leases expire at various
times through 2033. Certain lease agreements contain renewal options, rent abatement, and escalation clauses that are
factored into our determination of lease payments when appropriate.

The table below presents lease-related assets and liabilities recorded on the consolidated balance sheet (in

thousands):

Assets

Operating lease right-
of-use assets

Liabilities

Operating lease
liabilities (current)
Operating lease
liabilities (noncurrent)

Total lease liabilities $

February 28,

2022

2021

12,327 $

14,273

5,086 $

13,382
18,468 $

4,926

17,061
21,987

As a result of the adoption of ASC 842, effective March 1, 2019, the balance of the restructuring liability related
to certain facility leases have been reclassified as a reduction of the operating lease right-of-use assets in our
consolidated balance sheet. We recorded an impairment loss aggregating $0.7 million and $0.6 million, which
represented total operating lease right-of-use assets from various tower leases that were terminated or planned to be

terminated as well as ceased use office facilities as of February 28/29, 2021 and 2020, respectively. Impairment loss
relating to tower leases are considered as part of the discontinued operations (see Note 2) and the remaining balance
is included within the total impairment loss shown in the operating expenses in our consolidated statement of
comprehensive loss.

Lease Costs

The following lease costs were included in our consolidated statements of comprehensive income (loss) as

follows (in thousands):

Operating lease cost
Short-term lease cost
Variable lease cost
Total lease cost

Years ended February 28,

2022

2021

4,741 $
75
102
4,918 $

6,842
168
442
7,452

Supplemental Information

The table below presents supplemental information related to operating leases (in thousands, except weighted-

average information):

Cash paid for amounts included in the measurement of
operating lease liabilities
Right-of-use assets obtained in exchange for new
operating lease liabilities
Weighted average remaining lease term
Weighted average discount rate

Undiscounted Cash Flows

Years ended February 28,

2022

2021

6,005 $

3,087 $

3.8 years
5.17%

7,549

2,513
4.7 years

5.37%

The table below reconciles the undiscounted cash flows for each of the first five years and total of the remaining
years to the operating lease liabilities recorded on the consolidated balance sheet as of February 28, 2022 (in
thousands):

2023
2024
2025
2026
2027
Thereafter
Total minimum lease payments
Less imputed interest
Present value of future minimum lease
payments
Less current obligations under leases
Long-term lease obligations

5,894
5,564
3,958
3,090
1,334
500
20,340
(1,872)

18,468
(5,086)
13,382

NOTE 14 – INCOME TAXES

Our loss from continuing operations before income taxes and equity in net loss of affiliate consists of the

following (in thousands):

Domestic
Foreign
Total loss before income taxes and equity in net loss
of affiliate

Year Ended February 28/29,
2020
2021
2022
$ (22,943) $ (16,964) $ (31,381)
813

(3,632)

(7,118)

$ (30,061) $ (20,596) $ (30,568)

The components of income tax provision consists of the following (in thousands):

Current:
State
Foreign
Total current

Deferred:

Federal
State
Foreign
Total deferred
Income tax provision

Year Ended February 28/29,
2020
2021
2022

(33) $
(589)
(622)

40 $

(602)
(562)

(273)
(1,629)
(1,902)

(31)
(6)
(428)
(465)
(1,087) $

(59)
(18)
78
1

(12,852)
(10,645)
4,945
(18,552)
(561) $ (20,454)

The income tax benefit (provision) differs from the amount obtained by applying the statutory rate as follows

(in thousands):

Income tax benefit (provision) at U.S. statutory
federal rate
State income tax benefit, net of federal income tax
effect
Foreign taxes benefit (provision) exclusive of
valuation allowance change
U.S. taxes on foreign income
Valuation allowance increases
Research and other tax credits
Tax benefits on vested and exercised equity awards
Non-deductible expenses
Other, net
Total income tax provision

Year Ended February 28/29,
2020
2021
2022

6,313 $

4,325 $

6,420

730

602

117

(1,385)
-
(7,672)
1,544
(112)
(791)
286
(1,087) $

(50)
900
(571)
(306)
(27,726)
(5,825)
2,594
1,322
(606)
(851)
(697)
(655)
(73)
65
(561) $ (20,454)

The components of net deferred income tax assets for income tax purposes are as follows (in thousands):

Net operating loss carryforwards
Depreciation, amortization and impairments
Research and development credits
Stock-based compensation
Other tax credits
Capitalized research costs
ROU asset
Lease liabilities
Payroll and employee benefit accruals
Allowance for doubtful accounts
Other accrued liabilities
Convertible debt
Other, net
Total deferred tax assets (liabilities)
Valuation allowance
Net deferred tax assets (liabilities)

Reported as:
Deferred tax assets
Deferred tax liabilities
Net deferred tax assets

February 28,

2022

2021

33,379
(5,001)
23,484
1,795
2,211
2,657
(3,122)
4,667
1,906
677
3,365
(6,573)
8,236
67,681
(63,732)
3,949

4,165
(216)
3,949

27,194
(2,117)
21,917
2,944
2,197
2,638
(3,528)
5,472
1,984
1,163
4,743
(8,185)
5,137
61,559
(56,848)
4,711

4,889
(178)
4,711

As of February 28, 2022, we maintained a valuation allowance with respect to certain of our deferred tax assets
relating primarily to net operating losses and tax credits in domestic and certain foreign jurisdictions for which we
cannot assert that they are more likely than not going to be realized. For fiscal year 2022, we increased the valuation
allowance against our domestic and foreign net deferred tax assets by approximately $5.6 million and $1.3 million,
respectively. For fiscal year 2021, we considered positive and negative evidence, in assessing our ability to realize our
domestic and foreign net deferred tax assets and concluded that it is more likely than not that our domestic and many
of our foreign net deferred tax assets will not be realized. As such, we increased the valuation allowance against our
domestic and foreign net deferred tax asset by approximately $9.2 million and $2.1 million, respectively, for fiscal
year 2021. The amount of the net deferred tax assets considered realizable, however, could be adjusted in future
periods in the event sufficient evidence is present to support a conclusion that it is more likely than not that all or a
portion of our domestic deferred tax assets will be realized.

At February 28, 2022, we had net operating loss carryforwards of approximately $32.3 million, $68.3 million
and $42.8 million for federal, state and foreign purposes, respectively, expiring at various dates through fiscal year
2039. Approximately $43.1 and $17.9 million of federal and foreign net operating loss carryforwards do not expire,
respectively. The federal net operating loss carryforwards are subject to various limitations under Section 382 of the
Internal Revenue Code. If substantial changes in our ownership were to occur, there may be certain annual limitations
on the amount of the NOL carryforwards that can be utilized.

As of February 28, 2022, we had R&D tax credit carryforwards of $11.2 million and $11.7 million for federal
and state income tax purposes, respectively. The federal R&D tax credits expire at various dates through fiscal year
2040. A substantial portion of the state R&D tax credits have no expiration date. As of February 28, 2022, we had
foreign tax credit carryforwards of $1.9 million for federal income tax purposes which expire beginning in fiscal year
2023 through fiscal year 2032.

We accounted for stock-based compensation pursuant to ASU 2016-09 and we have tax deductions on exercised
stock options and vested restricted stock awards that did not exceed stock compensation expense amounts recognized
for financial reporting purposes in fiscal 2022 and 2021. The gross shortfall was $0.7 million and $4.1 million in fiscal
2022 and 2021, respectively. We follow ASC Topic 740, Income Taxes, which clarifies the accounting for income
taxes by prescribing a minimum recognition threshold that a tax position is required to meet before being recognized
in the financial statements. Management determined based on our evaluation of our income tax positions that we have
uncertain tax benefit of $1.6 million, $1.8 million, and $2.2 million at February 28/29, 2022, 2021 and 2020,
respectively, for which we have not yet recognized an income tax benefit for financial reporting purposes.

At February 28, 2022, we decreased the uncertain tax benefits related to certain foreign net operating loss
carryforwards and domestic tax credits by $0.1 million. At February 28, 2021, we decreased the uncertain tax benefits
related to certain foreign net operating loss carry forwards and domestic tax credits by $0.4 million . If total uncertain
tax benefits were realized in a future period, it would result in a tax benefit of $0.8 million. As of February 28, 2022
and 2021, our liabilities for uncertain tax benefits were netted against our deferred tax assets on our consolidated
balance sheet. It is reasonably possible the amount of unrecognized tax benefits could be reduced within the next 12
months by at least $0.5 million.

We recognize interest and/or penalties related to uncertain tax positions in income tax expense. No amounts of

interest and/or penalties have been accrued as of February 28, 2022.

Year Ended February 28/29,
2021

2020

2022

Gross amounts of unrecognized tax benefits as of the beginning of
the period
Decreases related to prior period tax positions
Decreases from lapse in statue of limitations
Foreign curreny translation adjustment
Gross amounts of unrecognized tax benefits as of the end of the
period

1,750 $
(45)
-
(58)

2,172 $
(2)
(550)
130

3,201
(34)
(908)
(87)

1,647 $

1,750 $

2,172

We file income tax returns in the U.S. federal jurisdiction, various U.S. states, Canada, Ireland, Italy, United
Kingdom, the Netherlands, Brazil, Mexico, Japan, Hong Kong and New Zealand. Certain income tax returns for the
years 2017 through 2020 remain open to examination by U.S. federal and state tax authorities. To the extent allowed
by law, the tax authorities may have the right to examine prior periods in which net operating losses or tax credits
were generated and carried forward, and to make adjustments up to the net operating loss or tax credit carryforward
amount. Our tax returns in the foreign jurisdictions remain open for examination for varying years by jurisdiction with
certain jurisdictions being open for examination from 2016 to the present.

For the fiscal years ended February 28, 2022 and 2021, we assert our intention to indefinitely reinvest foreign
earnings in all our non-U.S. subsidiaries and accordingly, recorded no deferred income taxes on outside basis
differences.

NOTE 15 – STOCKHOLDERS' EQUITY

Employee Stock Purchase Plan

On June 7, 2018, our Board of Directors adopted the CalAmp Corp. 2018 Employee Stock Purchase Plan (the
“ESPP”), which was approved by our stockholders on July 25, 2018. The ESPP provides for the issuance of 1.75
million shares of our common stock. The first enrollment under the ESPP Plan commenced in February 2019. There
are two enrollment periods each year that commence on February 1st and August 1st and lasts for six months. Stock-
based compensation expense related to the ESPP Plan for the years ended February 28/29, 2022, 2021 and 2020 were
$0.4 million, $0.7 million and $0.5 million, respectively.

Stock-Based Compensation

Our Board of Directors adopted the 2004 Incentive Stock Plan (the 2004 Plan) effective July 30, 2004, which
provides for the granting of qualified and nonqualified stock options, restricted stock, performance stock units (PSUs),
restricted stock units (RSUs), phantom stock and bonus stock to employees and directors. The primary purpose of the
2004 Plan is to enhance our ability to attract, motivate, and retain the services of qualified employees, officers and
directors. Any stock options under the 2004 Plan will have a term of not more than 10 years and the vesting of the
awards will be at the discretion of the Human Capital Committee of the Board of Directors but is not expected to
exceed four years. We treat equity awards with multiple vesting tranches as a single award for expense attribution
purposes and recognize compensation expense on a straight-line basis over the requisite service period of the entire
award. As of February 28, 2022, there were 1.1 million award units in the 2004 Plan that were available for grant.

The following table summarizes our stock option activity (number of options and aggregate intrinsic value in

thousands):

Weighted
Average
Exercise
Price

Weighted
average
remaining
contractual
life (years)

Aggregate
intrinsic
value

Number of
Options

1,054
171
(154)
-
1,071
(141)
(152)
778
(33)
(81)
664

633
507
556

$
$
$

13.44
11.11
2.44
-
14.65
4.07
17.52
16.01
7.53
16.45
16.38

13.21
15.80
15.98

5.8

6.2

6.0

5.4

4.7
5.2
5.2

$
$
$

850
123
33

Outstanding at February 28, 2019
Granted
Exercised
Forfeited or expired
Outstanding at February 29, 2020
Exercised
Forfeited or expired
Outstanding at February 28, 2021
Exercised
Forfeited or expired
Outstanding at February 28, 2022

Exercisable at:
February 29, 2020
February 28, 2021
February 28, 2022

2022

Year ended February 28/29,
2021

2020

Weighted average grant date fair value of stock
options granted during the year

4.82

We use the Black-Scholes-Merton option pricing model for valuation of stock option awards. Calculating the
fair value of stock option awards requires the input of subjective assumptions. Other reasonable assumptions could
provide differing results. The fair value of stock options at the grant date was determined using the following
assumptions as of February 29, 2020:

Black-Scholes Valuation Assumptions
Expected life (years)
Expected volatility
Risk-free interest rates
Expected dividend yield

6
43%
1.9%
0%

No options were granted in fiscal years 2022 and 2021. For the year ended February 29, 2020, the expected life
of options was determined using historical experience of our stock option grants and forfeiture activities. The expected
volatility is based on the historical volatility of our stock price. The risk-free interest rate is based on the implied yield
currently available on U.S. Treasuries with terms which approximate the expected life of the stock options.

Changes in our outstanding restricted stock shares, PSUs and RSUs for the fiscal years ended February 28/29,

2022, 2021 and 2020 were as follows (shares in thousands):

Number of
Restricted
Shares, PSUs
and RSUs

Weighted
Average
Grant Date
Fair Value

Shares
Retained to
Cover
Statutory
Minimum
Withholding
Taxes

1,507
1,597
(521)
(368)
2,215
1,885
(656)
(391)
3,053
1,629
(994)
(748)
2,940

19.77
11.28
18.67
16.27
14.47
7.91
15.07
11.95
10.61
11.09
12.01
10.63
10.39

177

214

343

Outstanding at February 28, 2019
Granted
Vested
Forfeited
Outstanding at February 29, 2020
Granted
Vested
Forfeited
Outstanding at February 28, 2021
Granted
Vested
Forfeited
Outstanding at February 28, 2022

Stock-based compensation expense is included in the following captions of the consolidated statements of

comprehensive loss (in thousands):

Cost of revenues
Research and development
Selling and marketing
General and administrative
Restructuring

Year Ended February 28/29,
2021

2020

2022

125 $

3,005
2,369
5,782
40
11,321 $

501 $

2,690
2,333
4,833
1,007
11,364 $

526
2,213
2,647
5,281
-
10,667

As of February 28, 2022, there was $21.4 million of unrecognized stock-based compensation cost related to
non-vested equity awards, which is expected to be recognized over a weighted-average remaining vesting period of
2.3 years.

Tax Benefits from Exercise of Stock Options and Vesting of Restricted Stock and RSU Awards

The aggregate fair value of stock options exercised and vested restricted stock and RSU awards as of the exercise
date or vesting date was $13.0 million, $9.4 million and $9.6 million for fiscal years ended February 28/29, 2022,
2021, and 2020, respectively. In connection with these equity awards, the excess stock compensation tax deductions
were $0 for fiscal years presented.

NOTE 16 –LOSS PER SHARE

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of
common shares outstanding during the period. Diluted earnings per share is computed by dividing net income (loss)
by the weighted average number of common shares outstanding during the period plus the dilutive effect of
outstanding stock options and restricted stock-based awards using the treasury stock method. The following table sets
forth the computation of basic and diluted loss per share (in thousands, except per share amounts):

Year Ended February 28/29,
2021

2020

2022

Loss from continuing operations before equity in net loss of affiliate and
related impairment loss
Equity in net loss of affiliate and related impairment loss

Net loss from continuing operations

Net income (loss) from discontinued operations, net of tax
Net loss

Basic and diluted weighted average number of common shares
outstanding

Basic and diluted net income (loss) per common share:

Loss from continuing operations
Income (loss) from discontinued operations

Net loss

(31,148) $

-
(31,148)
3,157
(27,991) $

(21,157) $

-
(21,157)
(35,152)
(56,309) $

(51,022)
(530)
(51,552)
(27,752)
(79,304)

35,254

34,389

33,670

(0.88) $
0.09
(0.79) $

(0.62) $
(1.02)
(1.64) $

(1.54)
(0.82)
(2.36)

Shares subject to anti-dilutive stock options and restricted stock-based awards were excluded from the
computation of diluted earnings per share for the fiscal years presented which included outstanding stock options in
the amount of 0.7 million, 0.8 million and 1.1 million as well as restricted stock based awards in the amount of 2.9
million, 3.1 million and 2.2 million for all fiscal years ended February 28/29, 2022, 2021, and 2020, respectively.

We have the option to pay cash, issue shares of common stock or any combination thereof for the aggregate
amount due upon conversion of the convertible senior notes. It is our intent to settle the principal amount of these
notes with cash, and therefore, we use the treasury stock method for calculating any potential dilutive effect of the
conversion option on diluted earnings (loss) per share. From the time of the issuance of the notes, the average market
price of our common stock has been less than the initial conversion price of the notes, and consequently no shares
have been included in diluted earnings per share for the conversion value of the notes.

NOTE 17 – EMPLOYEE RETIREMENT PLAN

We maintain a 401(k) defined-contribution plan allowing eligible U.S.-based employees to contribute up to an
annual maximum amount as set periodically by the Internal Revenue Service. The current matching contribution to
the plan is equal to 100% of the first 3% of participants’ compensation contribution plus 50% of the next 2%
contributed by the participant. We recorded expense for the matching contributions of $1.6 million, $1.9 million and
$2.1 million in fiscal years ended February 28/29, 2022, 2021 and 2020, respectively.

NOTE 18 – OTHER FINANCIAL INFORMATION

Supplemental Balance Sheet Information

Other current liabilities consist of the following (in thousands):

Operating lease liabilities
Litigation reserve
Customer deposits
Warranty reserves
Other

February 28,

2022

2021

5,086 $
3,000
2,586
1,823
6,456
18,951 $

4,926
2,200
2,472
1,257
6,525
17,380

Other non-current liabilities consist of the following (in thousands):

Deferred revenue
Deferred compensation plan liability
Deferred tax liability
Other

February 28,

2022

2021

13,496
6,800
216
2,128
22,640

19,893
6,992
178
3,424
30,487

Supplemental Income Statement Information

Interest expense consists of the following (in thousands):

Year Ended February 28/29,
2021

2020

2022

Interest expense on 2020 Convertible Notes:

Stated interest at 1.625% per annum
Amortization of discount and issuance costs

Interest expense on 2025 Convertible Notes:

Stated interest at 2.00% per annum
Amortization of discount and issuance costs

Other interest expense
Total interest expense

- $
-
-

4,600
10,134
14,734
589
15,323 $

93 $
289
382

4,587
9,378
13,965
1,140
15,487 $

1,464
4,336
5,800

4,613
8,750
13,363
933
20,096

Supplemental Cash Flow Information

“Net cash provided by (used in) operating activities” in the consolidated statements of cash flows includes cash
payments for interest and income taxes. The following is our supplemental schedule of cash payments for interest and
income taxes and non-cash investing and financing activities (in thousands):

Year Ended February 28/29,
2021

2020

2022

Cash payments for interest and income taxes:
Interest expense paid
Income tax paid, net of refunds
Non-cash investing and financing activities:
Accrued liability for capital expenditures

$
$

4,803 $
508 $

5,320 $
643 $

6,762
220

1,074 $

(604) $

(283)

Valuation and Qualifying Accounts

Following is our schedule of valuation and qualifying accounts for the last three years (in thousands):

Allowance for doubtful accounts:

Fiscal 2020
Fiscal 2021
Fiscal 2022
Warranty reserve:
Fiscal 2020
Fiscal 2021
Fiscal 2022

Deferred tax assets valuation allowance:

Fiscal 2020
Fiscal 2021
Fiscal 2022

Balance at
beginning
of year

Charged
(credited) to
costs and
expenses

Deductions

Balance at
end of year

1,203 $
2,264
3,658

1,398 $
987
1,257

10,929 $
45,560
56,848

2,214 $
2,163
156

729 $

2,729
2,239

34,631 $
11,288
6,884

(1,153) $
(769)
(1,168)

(1,140) $
(2,459)
(1,673)

- $
-
-

2,264
3,658
2,646

987
1,257
1,823

45,560
56,848
63,732

NOTE 19 – COMMITMENTS AND CONTINGENCIES

Legal Proceedings

Omega patent claim

In December 2013, a patent infringement lawsuit was filed against us by Omega Patents, LLC (“Omega”), a
non-practicing entity. Omega alleged that certain of our vehicle tracking products infringed on four patents owned by
Omega, (1) U.S. Patent Nos. 6,346,876 (the “’876 patent”), 6,756,885 (the “’885 patent”), 7,671,727 (the “’727”
patent), and 8,032,278 (the “’278 patent”). On February 24, 2016, a jury in the U.S. District Court for the Middle
District of Florida awarded Omega damages of $2.975 million. Following trial, Omega brought a motion seeking an
injunction and requesting the court to exercise its discretion to treble damages and assess attorneys’ fees. On April 5,
2017, the court denied the request for an injunction, but granted the request for treble damages in the aggregate amount
of $8.9 million. On April 24, 2017, the court awarded attorneys’ fees, costs, and prejudgment interest in the aggregate
amount of $1.2 million, and directed the payment of royalties to Omega for any infringing sales after February 24,
2016 at a royalty rate to be determined. On May 22, 2017, we filed motions with the court seeking judgment as a
matter of law and for a new trial. The court denied our motions on November 14, 2017. We then appealed to the Court
of Appeals for the Federal Circuit (the “Federal Circuit”). The appeal was fully briefed, and the court heard oral
argument on January 9, 2019. On April 8, 2019, the Federal Circuit vacated the compensatory and enhanced damages
and attorney’s fees awarded by the trial court to Omega. The Federal Circuit also set aside the jury’s verdict that our
alleged infringement was willful, and remanded the case for a new trial. As a result, substantially all of the previously
reserved legal provisions of $19.1 million as of November 30, 2018 was reversed. The reversal was recorded as a
reduction of general and administrative expenses in our consolidated statement of comprehensive loss for the fiscal
year ended February 28, 2019.

The new trial began on September 23, 2019 in the U.S. District Court for the Middle District of Florida (“Trial
Court”), and on September 30, 2019, the jury determined that we infringed two of the four patents; however, the jury
found that there was no willful infringement. On the first patent (the ’727 patent), the jury found only one unit
infringed, and assessed $1.00 in damages. On the second patent (the ’278 patent), the jury found direct infringement
and awarded damages at a rate of $5.00 per unit, for total damages of approximately $4.6 million. On November 26,
2019, the Trial Court entered judgment, awarding Omega damages of $4.6 million, together with pre-judgment interest
in the amount of $0.8 million through September 30, 2019. We filed motions with the Trial Court seeking judgment
as a matter of law (“JMOL”) in our favor and, alternatively, a new trial. On March 20, 2020, the Trial Court denied
our motion for JMOL, a new trial, and remittitur of damages. Also, on March 20, 2020, the Trial Court denied Omega’s
motion for a new trial on willfulness. On April 1, 2020, the Trial Court denied Omega’s motion to enhance the royalty
rate beyond the jury’s award of $5.00 per unit and motion to conduct post-trial discovery on our other OBD-II

compliant LMUs. Also on April 1, 2020, the Trial Court denied Omega’s motion to conduct post-trial discovery on
CalAmp’s other OBD-II compliant LMUs. On April 3, 2020, the Trial Court denied Omega’s final motion regarding
infringement of the VPODs. On April 30, 2020, we filed a notice of appeal at the Federal Circuit. Also on April 30,
2020, Omega filed notices of cross-appeal at the Federal Circuit. On May 6, 2021 the U.S. Court of Appeals for the
Federal Circuit (the “U.S. Court of Appeals”) heard oral arguments on our and Omega’s appeals. On September 14,
2021, the U.S. Court of Appeals issued its decision and affirmed the judgment of infringement with respect to the ’278
patent; however the U.S. Court of Appeal upheld our appeal on damages, vacated the damages award of the Trial
Court and remanded the case back to the Trial Court for a new trial on damages only.

The case is currently back with the Trial Court. On January 17, 2022, Omega filed a Motion to Reopen
Discovery For Limited Purpose and to Permit a Supplement to the Damages Expert Report and we filed a response
opposing Omega’s motion on February 9, 2022. A Pretrial Conference was held January 19, 2022. The Trial Court
granted Omega’s motion on March 16, 2022 to reopen discovery for certain purposes and permitted the parties to
supplement damages expert reports. A date for the third trial has not yet been set.

A mediation was held on April 12, 2022 to work towards a settlement. No settlement was reached during the
mediation. In connection with this claim, we have accrued our best estimate of the probable liability of $3.0 million
as a litigation reserve related to this matter based on reasonable royalty rates for similar technologies. It is reasonably
possible that the court in a new trial may award Omega damages and pre-judgment interest in excess of the amounts
we have accrued. Additionally, it is possible that the case may be settled and that the amount required to be paid by
us in such settlement may be different from the litigation reserve we have recorded.

Philips patent claim

On December 17, 2020, Koninklijke Philips N.V. (“Philips”) filed four separate legal actions against us, and
several other companies, accusing the companies of infringing Philips’s 3G and 4G wireless standard-essential
patents: (1) first, in the U.S. District Court, District of Delaware, Philips v. Quectel Wireless Solutions Co. Ltd.
(“Quectel”), CalAmp, Xirgo Technologies, LLC (“Xirgo”), and Laird Connectivity, Inc. (“Laird”), Philips alleges that
our location monitoring units infringe certain claims of U.S. Patent No. 7,831,271 (“the ’271 patent”), U.S. Patent No.
8,199,711 (“the ’711 patent”), U.S. Patent No. 7,554,943 (“the ’943 patent”), and U.S. Patent No. 7,944,935 (“the
’935 patent”) (all four patents collectively, the “Patents”); (2) second, in the U.S. District Court, District of Delaware,
Philips v. Telit Wireless Solutions, Inc., Telit Communications Plc, (collectively, “Telit”), and CalAmp, Philips
alleges that our location monitoring units and certain modules therein infringe certain claims of the Patents; (3) third,
in the U.S. District Court, District of Delaware, Philips v. Thales DIS AIS USA LLC (F/K/A Gemalto IoT LLC
“Gemalto”) F/K/A Cinterion Wireless Modules NAFTA LLC (“Cinterion”), Thales DIS AIS Deutschland GmbH
(F/K/A Gemalto M2M GmbH), Thales USA, Inc., Thales S.A., (collectively, “Thales”), CalAmp, Xirgo, and Laird,
Philips alleges that our location monitoring units infringe certain claims of the Patents, and (4) fourth, before The
International Trade Commission (“ITC”), Philips v. Quectel, CalAmp, Xirgo, Laird, Thales, Gemalto, Cinterion, and
Telit, Philips alleges violations of section 337 of the U.S. Tariff Act based upon our importation into the United States,
the sale for importation, and the sale within the United States after importation of certain UMTS (Universal Mobile
Telecommunications System) and LTE (Long Term Evolution) cellular communication modules and products
containing the same by reason of our location monitoring units that allegedly infringe on certain claims of the Patents,
and seeks (a) an investigation and a hearing under the Tariff Act for unlawful importation of allegedly infringing
product, (b) an exclusion order excluding entry into the U.S. of all allegedly infringing communication modules, and
(c) a permanent cease and desist order barring the importation, marketing, advertising, and sale of allegedly infringing
products in the U.S.

All four proceedings are currently pending. All three cases pending in U.S. District Court for the District of
Delaware are stayed until a final determination in the ITC. On April 1, 2022, the administrative law judge (“ALJ”) at
the ITC issued a Final Initial Determination on the question of violation of section 337 (19 U.S.C. § 1337). The
administrative law judge determined that a violation of section 337 has not occurred with respect to any of the asserted
patents. On April 13, 2022, Philips filed a Petition for Commission Review of the ALJ’s Initial Determination, and
Respondents responded to Philips’ Petition on April 21, 2022. The target date for issuance of a Final Decision is
August 1, 2022.

We believe that we have strong non-infringement and invalidity defenses should the Delaware district court
cases proceed. Also, we believe we have strong indemnification claims against our communication module suppliers,
and are entitled to have our defense costs and any losses resulting from these proceedings paid by those suppliers,
who are co-defendants in these proceedings. Currently, it is not feasible to predict with certainty the outcome of all
proceedings, and no specific amount of damages has been identified. Additionally, we believe the ultimate resolution
of the proceedings, including indemnification and defense by our module suppliers, will not have a material adverse
effect on our consolidated results of operations, financial condition, or cash flows.

In addition to the foregoing matters, from time to time as a normal consequence of doing business, various
claims and litigation may be asserted or commenced against us. In particular, we may receive claims concerning
contract performance or claims that our products or services infringe the intellectual property of third parties which
are in the ordinary course of business. While the outcome of any such claims or litigation cannot be predicted with
certainty, management does not believe that the outcome of such matters existing at the present time will have a
material adverse effect on our consolidated results of operations, financial condition or cash flows.

NOTE 20 – SEGMENT AND GEOGRAPHIC DATA

Since the LoJack U.S. SVR Products operating segment is presented as discontinued operations, we now operate
under two reportable segments: Software & Subscription Services and Telematics Products. Our organizational
structure is based on a number of factors that our CEO, the Chief Operating Decision Maker (“CODM”), uses to
evaluate and operate the business, which include customer base, homogeneity of products, and technology for the
fiscal years presented.

Our Software & Subscription Services segment offers cloud-based, application enablement and telematics
service platforms that facilitate integration of our own applications, as well as those of third parties, through open
Applications Programing Interfaces (“APIs”) to deliver full-featured IoT solutions to a wide range of customers and
markets. Our scalable proprietary SaaS offerings enable rapid and cost-effective deployment of high-value solutions
for customers all around the globe. Software & Subscription Services segment revenues includes SaaS, professional
services, devices sold with monitoring services and amortization of revenues and costs for customized devices
functional only with application subscriptions that are not sold separately.

Our Telematics Products segment offers a portfolio of wireless data communications products, which includes
asset tracking units, mobile telematics devices, fixed and mobile wireless gateways and routers. These wireless
networking devices underpin a wide range of our own and third party software and service solutions worldwide and
are critical for applications demanding secure, reliable and business-critical communications. Telematics Products
segment revenues consist primarily of distinct product sales.

Information by business segment is as follows (in thousands):

Year ended February 28, 2022

Operating Segments

Software &
Subscription
Services

Telematics
Products

Corporate
Expenses

Total
295,839
121,886

$
$

41.2%

(4,309) $

24,680

Revenues
Gross profit
Gross margin
Adjusted EBITDA

$
$

154,315
76,945

49.9%

32,979

$
$

141,524
44,941

31.8%
(3,990) $

Year ended February 28, 2021

Operating Segments

Software &
Subscription
Services

Telematics
Products

Corporate
Expenses

Revenues
Gross profit
Gross margin
Adjusted EBITDA

$
$

129,933
65,411

50.3%

32,226

$
$

178,654
56,994

31.9%
4,854

Total
308,587
122,405

$
$

39.7%

(4,974) $

32,106

Year ended February 29, 2020

Operating Segments

Software &
Subscription
Services

Telematics
Products

Corporate
Expenses

Revenues
Gross profit
Gross margin
Adjusted EBITDA

$
$

123,460
56,283

45.6%

21,674

$
$

198,313
69,210

34.9%

21,763

(4,528) $

38,909

Total
321,773
125,493

$
$

39.0%

The amount shown for each period in the “Corporate Expenses” column above consists of expenses that are not
allocated to the business segments. These unallocated corporate expenses include salaries and benefits of certain
corporate staff and expenses such as audit fees, investor relations, stock listing fees, director and officer liability
insurance, and director fees and expenses.

Our CODM evaluates each segment based primarily on revenue and Adjusted Earnings Before Interest, Taxes,
Depreciation and Amortization (“Adjusted EBITDA”), and we therefore consider Adjusted EBITDA to be a primary
measure of operating performance of our operating segments. We define Adjusted EBITDA as earnings before
investment income, interest expense, taxes, depreciation, amortization and stock-based compensation, impairment loss
and other adjustments as identified below. The adjustments to our financial results prepared in accordance with U.S.
generally accepted accounting principles (“GAAP”) to calculate Adjusted EBITDA are itemized below (in thousands):

Year Ended February 28/29,
2021

2020

2022

Net loss from continuing operations

Investment income
Interest expense
Income tax provision
Depreciation and amortization
Stock-based compensation
Loss on extinguishment of debt
Acquisition and integration related expenses
Non-recurring legal expenses, net of reversal of litigation
provision
Restructuring
Impairment losses
Costs incurred in transition of LoJack North America business to
acquiror
Other

Adjusted EBITDA

(31,148) $
(1,175)
15,323
1,087
22,804
11,321
-
-

2,518
600
-

(21,157) $
(2,119)
15,487
561
22,002
10,357
-
-

2,262
2,534
825

2,103
1,247
24,680

-
1,354
32,106

(51,552)
(4,497)
20,096
20,454
23,312
10,667
2,408
2,210

6,213
2,465
5,754

-
1,379
38,909

Our CODM does not obtain identifiable assets by segment because our businesses share resources, functions

and facilities. We do not have significant long-lived assets outside the United States.

Revenues by geographic area are as follows (in thousands):

Year Ended February 28/29,
2021

2020

2022

United States
EMEA
LATAM
APAC
All other

197,178 $
51,771
24,760
19,028
3,102
295,839 $

200,665 $
58,470
27,110
16,820
5,522
308,587 $

222,055
55,185
21,232
14,342
8,959
321,773

Revenues by geographic area are based upon the country of billing. The geographic location of distributors and
OEM customers may be different from the geographic location of the ultimate end users of the products and services
provided by us. No single non-U.S. country accounted for more than 10% of our revenue in fiscal years ended February
28/29, 2022, 2021 and 2020.

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

Not applicable.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our principal executive officer and principal financial officer have concluded, based on their evaluation of
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of February
28, 2022, that our disclosure controls and procedures are effective, at the reasonable assurance level, to ensure that
the information required to be disclosed in reports that are filed or submitted under the Exchange Act is accumulated
and communicated to management, including the principal executive officer and principal financial officer, as
appropriate, to allow timely decisions regarding required disclosure and to allow such information to be recorded,
processed, summarized and reported within the time periods specified in the rules and forms of the Securities
Exchange Commission.

Management's Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial

reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.

Our management has assessed the effectiveness of our internal control over financial reporting as of February
28, 2022. In making this assessment, management used criteria set forth in Internal Control – Integrated Framework
(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our assessment,
we have concluded that as of February 28, 2022 our internal control over financial reporting is effective based on
those criteria.

The effectiveness of our internal control over financial reporting as of February 28, 2022 has been audited by
Deloitte & Touche, LLP, an independent registered public accounting firm, as stated in their report, which is included
below.

Changes in Internal Control over Financial Reporting

In connection with our initiative to integrate and enhance our global information technology systems and
business processes, we initiated the phased implementation of a new ERP system which started in fiscal 2020 and
continued through fiscal 2022. As a result of this implementation, we modified certain existing internal controls over
financial reporting as well as implemented new controls and procedures related to the new ERP system. Other than
the continued implementation of our ERP system, there were no changes in our internal controls over financial
reporting (as defined in Rules 13a-15(f) and 15d 15(f) under the Exchange Act) that occurred during the fourth quarter
of fiscal 2022 that have materially affected, or are reasonably likely to materially affect, our internal controls over
financial reporting.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of CalAmp Corp.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of CalAmp Corp. and subsidiaries (the “Company”) as
of February 28, 2022, based on criteria established in Internal Control — Integrated Framework (2013) issued by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company
maintained, in all material respects, effective internal control over financial reporting as of February 28, 2022, based
on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the consolidated financial statements as of and for the year ended February 28, 2022, of the
Company and our report dated April 28, 2022 expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over financial reporting, included in the accompanying
Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the
Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered
with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was
maintained in all material respects. Our audit included obtaining an understanding of internal control over financial
reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles. A company’s internal control over financial reporting includes those
policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance
with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have
a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.

/s/ Deloitte & Touche LLP

Costa Mesa, California

April 28, 2022

ITEM 9B. OTHER INFORMATION

None.

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this Item will be included in our 2022 Proxy Statement, which will be filed with

the SEC and is incorporated herein by reference.

ITEM 11.

EXECUTIVE COMPENSATION

The information required by this Item will be included in our 2022 Proxy Statement, which will be filed with

the SEC and is incorporated herein by this reference.

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS

The information required by this Item will be included in our 2022 Proxy Statement, which will be filed with

the SEC and is incorporated herein by this reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR

INDEPENDENCE

The information required by this Item will be included in our 2022 Proxy Statement, which will be filed with

the SEC and is incorporated herein by this reference.

ITEM 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES

The information required by this Item will be included in our 2022 Proxy Statement, which will be filed with

the SEC and is incorporated herein by this reference.

ITEM 15.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a) The following documents are filed as part of this Report:

PART IV

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:

Reports of Independent Registered Public Accounting Firm (PCAOB ID No. 34).......................................
Consolidated Balance Sheets .........................................................................................................................
Consolidated Statements of Comprehensive Loss ........................................................................................
Consolidated Statements of Stockholders' Equity .........................................................................................
Consolidated Statements of Cash Flows .......................................................................................................
Notes to Consolidated Financial Statements ..................................................................................................

Form 10-K
Page No.

47
50
51
52
53
54

Financial Statements Schedules:

Schedule II – Valuation and Qualifying Accounts information is included in Note 18 to the consolidated
financial statements which are filed as part of this report under Item 8 – Financial Statements and Supplementary Data.

All other financial statement schedules for which provision is made in the applicable accounting regulations of
the Securities and Exchange Commission are not required under the related instructions or are inapplicable and,
therefore, have been omitted.

Exhibits

Exhibits required to be filed as part of this report are:

Exhibit
Number Description

2.1

3.1

3.2

4.1

4.2

4.3

10.

10.1

Agreement and Plan of Merger, dated as of February 1, 2016, by and among LoJack Corporation, the
Company, and Lexus Acquisition Sub, Inc. (incorporated by reference to Exhibit 2.1 on Form 8-K dated
February 2, 2016).

Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the
Company's Quarterly Report on Form 10-Q for the period ended August 31, 2014).

Amended and restated bylaws of the Company (incorporated by reference to Exhibit 3.2 of the Company's
Annual Report on Form 10-K for the period ended February 29, 2020).

Indenture, dated July 20, 2018 between the Company and The Bank of New York Mellon Trust Company,
N.A. (incorporated by reference to Exhibit 4.1 of the Company's Report on Form 8-K filed on July 20,
2018).

Form of 2.00% Convertible Senior Notes due August 1, 2025 (incorporated by reference as Exhibit A to
Exhibit 4.1 of the Company's Report on Form 8-K filed on July 20, 2018).

Description of Registrant’s Securities Registered Pursuant to Section 12 of The Securities Exchange Act
of 1934 (incorporated by reference to Exhibit 4.5 of the Company's Annual Report on Form 10-K for the
year ended February 29, 2020).

Material Contracts:
(i) Other than Compensatory Plans or Arrangements:

Form of Directors and Officers Indemnity Agreement (incorporated by reference to Exhibit 10.4 of the
Company's Annual Report on Form 10-K for the year ended February 28, 2018).

Exhibit
Number Description

10.2

10.3

10.4

10.5

10.6

10.7

10.8

10.9

10.10

10.11

10.12

10.13

10.14

10.15

10.16

Credit Agreement, dated as of March 30, 2018, among the Company, the lenders from time to time party
thereto, and JPMorgan, N.A. as Agent (incorporated by reference to Exhibit 10.1 of the Company’s Current
Report on Form 8-K dated April 5, 2018).

First Amendment to Credit Agreement, dated as of July 16, 2018, among the Company, the lenders from
time to time party thereto, and JPMorgan, N.A. as Agent

Second Amendment to Credit Agreement, dated as of March 27, 2020, among the Company, the lenders
from time to time party thereto, and JPMorgan, N.A. as Agent (incorporated by reference to Exhibit 10.1
of the Company’s Current Report on Form 8-K dated March 27, 2020).

Third Amendment to Credit Agreement, dated as of March 30, 2022, among the Company, the lenders
from time to time party thereto, and JPMorgan N.A. as Agents

Confirmation of Base Call Option Transaction, dated July 17, 2018, between the Company and Nomura
Global Financial Products Inc. (incorporated by reference to Exhibit 10.1 of the Company's Current Report
on Form 8-K filed on July 20, 2018).

Confirmation of Base Call Option Transaction, dated July 17, 2018, between the Company and Jefferies
International Limited. (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form
8-K filed on July 20, 2018).

Confirmation of Base Call Option Transaction, dated July 17, 2018, between the Company. and Deutsche
Bank AG, London Branch. (incorporated by reference to Exhibit 10.3 of the Company's Current Report on
Form 8-K filed on July 20, 2018).

Confirmation of Base Call Option Transaction, dated July 17, 2018, between the Company. and Goldman
Sachs & Co, LLC. (incorporated by reference to Exhibit 10.4 of the Company's Current Report on Form
8-K filed on July 20, 2018).

Confirmation of Additional Call Option Transaction, dated July 17, 2018, between the Company. and
Nomura Global Financial Products, Inc. (incorporated by reference to Exhibit 10.5 of the Company's
Current Report on Form 8-K filed on July 20, 2018).

Confirmation of Additional Call Option Transaction, dated July 17, 2018, between the Company. and
Jefferies International Limited. (incorporated by reference to Exhibit 10.6 of the Company's Current Report
on Form 8-K filed on July 20, 2018).

Confirmation of Additional Call Option Transaction, dated July 17, 2018, between the Company. and
Deutsche Bank AG, London Branch. (incorporated by reference to Exhibit 10.7 of the Company's Current
Report on Form 8-K filed on July 20, 2018).

Confirmation of Additional Call Option Transaction, dated July 17, 2018, between the Company. and
Goldman Sachs & Co, LLC. (incorporated by reference to Exhibit 10.8 of the Company's Current Report
on Form 8-K filed on July 20, 2018).

(ii) Compensatory Plans or Arrangements required to be filed as Exhibits to this Report pursuant to Item
15 (b) of this Report:

Offer Letter, executed on August 21, 2020, by and between the Company and Kirsten Wolberg
(incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed August
26,2020).

CalAmp Corp. Amended and Restated 2018 Employee Stock Purchase Plan (incorporated by reference
to Exhibit 10.7 of the Company’s Quarterly Report on Form 10-Q for the period ended May 31, 2020).

CalAmp Corp. Amended and Restated 2004 Incentive Stock Plan (incorporated by reference to Exhibit A
of the Company’s Definitive Proxy Statement filed June 21, 2021).

10.17

10.18

10.19

10.20

10.21

Separation Agreement and General Release between the Company and Michael Burdiek dated March 20,
2020 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed on
March 25, 2020).

Employment Agreement between the Company and Kurtis Binder, dated December 17, 2021
(incorporated by reference to Exhibit 10.4 of the Company’s Quarterly Report on Form 10-Q for the
period ended November 30, 2021).

Employment Agreement between the Company and Arym Diamond, dated December 16, 2021
(incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q for the
period ended November 30, 2021).

Employment Agreement between the Company and Anand Rau, dated December 16, 2021 (incorporated
by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q for the period ended
November 30, 2021).

Employment Agreement between the Company and Jeffery Gardner, dated December 18, 2021
(incorporated by reference to Exhibit 10.3 of the Company’s Quarterly Report on Form 10-Q for the
period ended November 30, 2021).

10.22

Offer Letter, dated April 2, 2021, by and between the Company and Henry Maier (incorporated by
reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed April 7, 2021).

10.23

Employment Agreement between the Company and Jeffrey Clark, dated November 1, 2021

10.24

Employment Agreement between the Company and Monica Van Berkel, dated November 1, 2021

10.25

Employment Agreement between the Company and Nathan Lowstuter, dated November 1, 2021

10.26

Employment Agreement between the Company and Richard Scott, dated November 1, 2021

23.1

31.1

31.2

101

Subsidiaries of the Registrant.

Consent of Deloitte & Touche LLP.

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.

Interactive Data Files Pursuant to Rule 405 of Regulation S-T: (i) Consolidated Balance Sheets as of
February 28, 2022 and February 28, 2021, (ii) Consolidated Statements of Comprehensive Income for the
years ended February 28, 2022, February 28, 2021 and February 29, 2020, (iii) Consolidated Statement of
Stockholders’ Equity for the years ended February 28, 2022, February 28, 2021 and February 29, 2020,
(iv) Consolidated Statements of Cash Flows for the years ended February 28, 2022, February 28, 2021 and
February 29, 2020, and (v) Notes to Consolidated Financial Statements.

104

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

ITEM 16.

FORM 10-K SUMMARY

None.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has

duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on April 28, 2022.

SIGNATURES

CALAMP CORP.

By: /s/ Jeffery Gardner

Jeffery Gardner President and Chief Executive
Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the

following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature

Title

/s/ Amal Johnson

Chair of the Board of Directors

Amal Johnson

/s/ Scott Arnold

Director

Scott Arnold

/s/ Jason Cohenour
Jason Cohenour

Director

/s/ Henry Maier

Director

Henry Maier

/s/ Roxanne Oulman
Roxanne Oulman

Director

/s/ Jorge Titinger

Director

Jorge Titinger

/s/ Kirsten Wolberg
Kirsten Wolberg

Director

/s/ Jeffery Gardner
Jeffery Gardner

President, Chief Executive Officer and
Director (principal executive officer)

/s/ Kurtis Binder

Kurtis Binder

Executive Vice President, Chief Financial Officer
(principal accounting and financial officer)

Date

April 28, 2022

[THIS PAGE INTENTIONALLY LEFT BLANK]

Corporate Information

Board of Directors

Amal Johnson

Chair of the Board, CalAmp Corp
Former Director and Executive Chair of the Board,
Author-it Software Corporation

Scott Arnold

President and CEO, AuditBoard

Jason Cohenour

Former President, CEO and Director, Sierra Wireless, Inc.

Jeff Gardner

President, Chief Executive Officer and Director, CalAmp Corp..

Henry J. Maier

Former President and CEO, FedEx Ground

Roxanne Oulman
CFO, Medallia, Inc.

Jorge Titinger

CEO, Titinger Consulting and former President,
CEO and Director, Silicon Graphics International Corporation

Kirsten Wolberg

Former Chief Technology & Operations Officer, DocuSign, Inc.

Investor Information

CalAmp (Nasdaq: CAMP) is a connected intelligence company
that leverages a data-driven solutions ecosystem to help people
and organizations improve operational performance. We solve
complex problems in transportation and logistics, commercial and
government fleet, industrial equipment and consumer vehicle
marketplaces by providing solutions that track, monitor and
recover vital assets. The insights enabled by our cloud platform,
applications and edge computing devices drive operational
visibility, safety, efficiency, maintenance and sustainability.
Headquartered in Irvine, California, CalAmp has over one million
software and services subscribers and 10 million edge devices
deployed worldwide. For more information, visit calamp.com, or
LinkedIn, Facebook, Twitter, YouTube or CalAmp Blog.

Primary IR Contact

Leanne K. Sievers
Shelton Group

949.224.3874

sheltonir@sheltongroup.com

Leadership

Jeff Gardner*

President and Chief Executive Officer

Kurt Binder*

Executive Vice President and Chief Financial Officer

Anand Rau*

Chief Technology Officer

Basudeb Chatterjee

Chief Digital Information Officer

Brennen Carson

Chief Revenue Officer

Jeff Clark*

Chief Product Officer

Mark Gaydos

Chief Marketing Officer

Maurizio Iperti

President, EMEA

Monica Van Berkel*
Chief People Officer

Nathan Lowstuter*

Chief Supply Chain Officer

Richard Scott*

Chief Legal Officer

Auditors

Deloitte & Touche LLP

Legal Counsel

Latham & Watkins LLP

Transfer Agent and Registrar

American Stock Transfer & Trust Co.

*Corporate Officer

CalAmp
15635 Alton Parkway, Suite 250
Irvine, CA 92618
888.3CALAMP
calamp.com

2022 Annual Report