Numerex (NMRX) 8-K/A Financial Statements and Exhibits

Exhibit 99.3

Numerex Corp
Unaudited Pro Forma Financial Information

July 31, 2007, Numerex Corp. (Numerex) through it subsidiary, Orbit One Communications, LLC completed the acquisition of the assets of Orbit One Communications, Inc (“OOCI”). The unaudited pro forma combined condensed consolidated balance sheet as of June 30, 2007 assumes that the acquisition occurred on June 30, 2007 rather than the actual closing date of July 31, 2007. The unaudited pro forma combined consolidated statements of operations for the six months ended June 30, 2007 and for the twelve months ended December 31, 2006 assumes that the acquisition occurred on January 1, 2006 and January 1, 2005 respectively.

The unaudited pro forma information is based on the historical consolidated financial statements of Numerex and those of OOCI, as described in the pro forma financial statements, under the purchase method of accounting and the adjustments as described in the accompanying notes to the unaudited pro forma combined condensed consolidated financial statements. The pro forma combined condensed consolidated balance sheet, statements of operations and accompanying notes are qualified in their entirety and should be read in conjunction with the historical consolidated financial statements and accompanying notes in Numerex’s annual report on Form 10-K and OOCI’s audited consolidated financial statements for the period ended December 31, 2006 which are incorporated herein as Exhibit 99.1.

These proforma financial statements reflect actual cash paid of $5.5 million as well as associated transaction costs for the acquisition of the assets of OCCI. They do not reflect any subsequent payments which could include additional cash payments of $2.5 million. Additionally, upon achievement of certain revenue and EBITDA performance objectives and milestones, Orbit One is entitled to earn-out payments of up to 1,100,000 shares of the Company’s Class A common stock. If the performance targets are exceeded, Orbit One may receive up to an additional 471,729 shares of the Company’s Class A common stock and an additional cash payment of $2.5 million. The earn-out milestones are measured over three periods: (i) from the closing date of the transaction through December 31, 2007; (ii) calendar year 2008; and (iii) calendar year 2009. The Company and Orbit One entered into an escrow agreement, whereby 10% of the cash payments not subject to performance-related milestones were placed in escrow for one year from the closing date in order to settle any indemnification claims under the Agreement and subject to the limitations described therein. Any additional payments of either cash or equity will be reflected as incremental goodwill.

The unaudited pro forma combined condensed consolidated financial statements presented are for informational purposes only and do not purport to represent what Numerex’s financial position or results of operations would have been as of the date or for the period presented had the acquisition in fact occurred on such date or at the beginning of the period indicated, or to project Numerex’s financial position or results of operations for any future date or period. For purposes of preparing Numerex’s consolidated financial statements subsequent to the acquisition, Numerex will establish a new basis for the assets and liabilities of Orbit One Communications, LLC based upon the fair values thereof and Numerex’s purchase price, including the costs of the acquisition. A final determination of the allocation of the purchase price to the assets acquired and liabilities assumed based on their respective fair values has not yet been completed. Accordingly, the purchase accounting adjustments made in connection with the development of the unaudited pro forma combined condensed consolidated financial statements are preliminary and have been made solely for purposes of developing such unaudited pro forma combined condensed consolidated financial statements. As a result of these factors, the actual financial position and results of operations will differ, perhaps significantly, from the pro forma amounts reflected herein. The unaudited pro forma combined condensed consolidated financial statements should be read in conjunction with the historical consolidated financial statements of Numerex and OOCI, including the related notes thereto.

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NUMEREX CORP. AND SUBSIDIARIES
UNAUDITED PROFORMA CONSOLIDATED BALANCE SHEET
AS OF JUNE 30, 2007

(in thousands)

				Orbit One
				Communications,			Proforma
	Numerex			Inc.			Adjustments						Pro Forma
	2007			2007			for acquisition			Notes			Consolidated
ASSETS
CURRENT ASSETS
Cash and cash equivalents		17,362			2,448			(7,948	)		(a	)		11,862
Accounts receivable:		15,104			230									15,334
Inventory		5,552			1,181									6,733
Prepaid expenses and other current assets		4,043			416									4,459
TOTAL CURRENT ASSETS		42,061			4,275			(7,948	)					38,388
Property and Equipment, Net		1,312			763			(116	)		(b	)		1,959
Goodwill, Net		16,985			0			2,204			(b	)		19,189
Other Intangibles, Net		6,465			39			940			(b	)		7,444
Software, Net		2,121			378			908			(b	)		3,407
Other Assets		653			16			0						669
Assets from Discontinued Operations		0			864			(864	)		(c	)		0
Deferred tax asset — LT		2,070			0			0						2,070
TOTAL ASSETS		71,667			6,335			(4,876	)					73,126
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable		10,866			411									11,277
Other current liabilities		2,126			452			(218	)		(b	)		2,360
Notes payable, current		1,858			1,680			(1,680	)		(b	)		1,858
Deferred revenues and capital leases		1,099			927									2,026
TOTAL CURRENT LIABILITIES		15,949			3,470			(1,898	)					17,521
LONG TERM LIABILITIES
Obligations under capital leases and other long term liabilities		327			5									332
Notes Payable		12,181												12,181
TOTAL LONG TERM LIABILITIES		12,508			5			0						12,513
SHAREHOLDERS’ EQUITY
Common Stock		44,670						(118	)		(g	)		44,552
Paid in Capital		2,896			158			(158	)		(g	)		2,896
Treasury Stock		(5,053	)		(1,125	)		1,125			(g	)		(5,053	)
Accumulated comprehensive income (loss)		(8	)											(8	)
Accumulated earnings		705			3,827			(3,827	)		(g	)		705
TOTAL SHAREHOLDERS’ EQUITY		43,210			2,860			(2,978	)					43,092
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		71,667			6,335			(4,876	)					73,126

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NUMEREX CORP. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED PROFORMA STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2007

				Orbit One
				Communications,
	Numerex Corp			Inc.
	Six months			Six months
	ended June 30,			ended June 30,			Adjustments						Pro Forma
	2007			2007			for acquisition			Notes			Consolidated
Total net sales	$	29,356		$	3,599								$	32,955
Cost of sales (excluding depreciation)		19,262			754									20,016
Depreciation and amortization		32			—									32
Gross Profit		10,062			2,845									12,907
Selling, general, and administrative expenses		7,480			1,548									9,028
Research and development expenses		622			411									1,033
Depreciation and amortization		988			144			150			(d	)		1,282
Bad Debt Expense		249			—									249
Operating earnings (loss)		723			742			(150	)					1,315
Net interest expense		(502	)		96			(138	)		(e	)		(544	)
Gain on sale of assets		—			(1	)								(1	)
Net other income and (expense)		(17	)		63									46
Total other income and (expense)		(519	)		158			(138	)					(499	)
Earnings (loss) before income   taxes		204			900			(288	)					816
Provision for income taxes		100			360			(115	)		(f	)		345
Net earnings (loss)	$	104		$	540		$	(173	)				$	471
Basic earnings (loss) per share	$	0.01											$	0.04
Diluted earnings (loss) per share	$	0.01											$	0.03
Weighted average common shares used in per share calculation
Basic		13,081						—						13,081
Diluted		13,780						—						13,780

See accompanying notes to the unaudited consolidated proforma statement of operations.

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NUMEREX CORP. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED PROFORMA STATEMENT OF OPERATIONS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2006

				Orbit One
				Communications,
	Numerex Corp			Inc.
	TWELVE			TWELVE
	MONTHS			MONTHS
	ENDED			ENDED
	DECEMBER 31,			DECEMBER 31,		Adjustments						Pro Forma
	2006			2006		for acquisition			Notes			Consolidated
Total net sales		52,788			12,422								65,210
Cost of sales (excluding depreciation)		27,967			5,174								33,141
Cost of services		5,750			—								5,750
Depreciation and amortization		149			—								149
Gross Profit		18,922			7,248		—						26,170
Selling, general, and administrative expenses		12,088			3,140								15,228
Research and development expenses		1,067			178								1,245
Depreciation and amortization		1,755			170		300			(d	)		2,225
Bad Debt Expense		198			—								198
Goodwill impairment		2,140											2,140
Operating earnings (loss)		1,674			3,760		(300	)					5,134
Net interest expense		(552	)		62		(275	)		(e	)		(765	)
Gain on sale of assets		—			23								23
Net other income and (expense)		31			101								132
Earnings before income taxes		1,153			3,946		(575	)					4,524
Provision for income taxes		(2,950	)		1,578		(230	)		(f	)		(1,602	)
Net earnings		4,103			2,368		(345	)					6,126
Foreign Currency translation adjustment		10											10
Comprehensive earnings		4,093			2,368		(345	)					6,116
Basic earnings per share	$	0.33										$	0.49
Diluted earnings per share	$	0.32										$	0.47
Weighted average common shares used in per share calculation
Basic		12,502											12,502
Diluted		12,985											12,985

See accompanying notes to the unaudited consolidated proforma statement of operations

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NUMEREX CORP.

PROFORMA ADJUSTMENTS

NOTES TO UNAUDITED FINANCIAL STATEMENTS AS OF JUNE 30, 2007 AND DECEMBER 31, 2006

(In thousands, except share information)

(a)	Reflects the cash paid of $5,500. Cash of Orbit One Communications, Inc. (“OOCI”) was not included in the transaction.
(b)	The assets acquired and the liabilities assumed in the OOCI transaction have been reflected at their fair values, and the excess cost over net tangible and intangible assets acquired is reflected on the balance sheet as Goodwill in the amount of $2,204.
(c)	OOCI’s Discontinued Operations were not acquired in the transaction.
(d)	Adjustment represents amortization of acquired identifiable intangible assets of Orbit One Communications, LLC based on estimated lives ranging from 1 to 9 years. Goodwill amortization is not recorded in accordance with the provisions of Statement of Financial Accounting Standards Board No. 141, “Business Combinations” and No. 142, “Goodwill and Other Intangible Assets.”
(e)	Adjustment assumes foregone interest income at the rate of 5% for the cash used to purchase the assets of OOCI.
(f)	Adjustments to income tax provision relating to income statement adjustments above, assuming a statutory federal and state income tax rate of 40% for period indicated.
(g)	To eliminate OOCI’s equity and to record the assets acquired, liabilities assumed and the goodwill as of June 30, 2007 resulting from the acquisition based on the following computations, estimates, and assumptions:

Purchase price:	$	5,500
Plus transactions costs		318
Total purchase price		5, 818
Less fair value of assets acquired:
Fair value of assets acquired:
Net receivables		454
Prepaid assets		464
Inventory		1,163
Property, plant and equipment		647
Other intangibles, net		940
Software, net		1,283
Deposits		16
Fair value of liabilities assumed:
Accrued liabilities		(239	)
Capital lease obligations		( 8	)
Deferred revenues		(1,106	)
Fair value of net assets acquired		3,614
Goodwill resulting from acquisition	$	2,204

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