Document_And_Entity_Informatio
Document And Entity Information (USD $) | 12 Months Ended | ||
Jan. 03, 2015 | Mar. 20, 2015 | Jun. 28, 2014 | |
Document Information [Line Items] | |||
Entity Registrant Name | Cartesian, Inc. | ||
Entity Central Index Key | 1094814 | ||
Current Fiscal Year End Date | -2 | ||
Entity Filer Category | Smaller Reporting Company | ||
Trading Symbol | CRTN | ||
Entity Common Stock, Shares Outstanding | 8,715,493 | ||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 3-Jan-15 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $17,600,000 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS: | ||
Cash and cash equivalents | $12,999 | $13,780 |
Receivables: | ||
Accounts receivable - billed & unbilled | 13,671 | 11,864 |
Less: Allowance for doubtful accounts | -144 | -148 |
Net receivables | 13,527 | 11,716 |
Inventory | 3,000 | 0 |
Prepaid and other current assets | 1,747 | 1,751 |
Total current assets | 31,273 | 27,247 |
NONCURRENT ASSETS: | ||
Property and equipment, net | 1,292 | 1,202 |
Goodwill | 8,015 | 8,225 |
Deferred income tax assets | 1,085 | 0 |
Other noncurrent assets | 611 | 150 |
Total Assets | 42,276 | 36,824 |
CURRENT LIABILITIES: | ||
Trade accounts payable | 1,806 | 2,036 |
Current borrowings | 3,269 | 0 |
Liability for derivatives | 337 | 0 |
Accrued payroll, bonuses and related expenses | 3,899 | 4,249 |
Accrued severance liability and related costs | 1,694 | 1,491 |
Deferred revenue | 1,665 | 591 |
Other accrued liabilities | 986 | 1,631 |
Total current liabilities | 13,656 | 9,998 |
NONCURRENT LIABILITIES: | ||
Deferred income tax liabilities | 722 | 586 |
Deferred revenue | 330 | 0 |
Other noncurrent liabilities | 151 | 342 |
Total noncurrent liabilities | 1,203 | 928 |
Commitments and contingencies (Note 11) | ||
STOCKHOLDERS' EQUITY: | ||
Common stock: Voting - $.005 par value, 20,000,000 shares authorized; 9,259,562 (including 472,782 treasury shares) and 8,491,382 (including 454,760 treasury shares) shares issued as of January 3, 2015 and December 28, 2013, respectively; 8,786,780 and 8,036,622 shares outstanding as of January 3, 2015 and December 28, 2013, respectively | 46 | 42 |
Preferred stock - $.001 par value, 2,000,000 shares authorized; no shares issued or outstanding | ||
Additional paid-in capital | 181,829 | 178,054 |
Accumulated deficit | -146,207 | -144,796 |
Treasury stock, at cost | -3,656 | -3,589 |
Accumulated other comprehensive income - | ||
Foreign currency translation adjustment | -4,595 | -3,813 |
Total stockholders' equity | 27,417 | 25,898 |
Total Liabilities and Stockholders' Equity | $42,276 | $36,824 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
Common Stock Par Or Stated Value Per Share (in dollars per share) | $0.01 | $0.01 |
Common Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Common Stock, Shares, Issued | 9,259,562 | 8,491,382 |
Common Stock, Shares, Outstanding | 8,786,780 | 8,036,622 |
Preferred Stock, Par Or Stated Value Per Share (in dollars per share) | $0.00 | $0.00 |
Preferred Stock, Shares Authorized | 2,000,000 | 2,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Treasury Stock, Shares | 472,782 | 454,760 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Revenues | $71,675 | $55,371 |
Cost of services (includes non-cash share-based compensation of $2 for the year ended January 3, 2015) | 45,088 | 34,529 |
Gross Profit | 26,587 | 20,842 |
Selling, general and administrative expenses (includes non-cash share-based compensation expense of $1,055 and $737, respectively) | 27,468 | 22,784 |
Loss from operations | -881 | -1,942 |
Other (expense) income: | ||
Interest (expense) income, net | -200 | 4 |
Discount on note payable and transaction costs | -1,610 | 0 |
Change in fair value of warrants and derivative liabilities | 159 | 0 |
Total other (expense) income | -1,651 | 4 |
Loss before income taxes | -2,532 | -1,938 |
Income tax provision | 1,121 | -114 |
Net loss | -1,411 | -2,052 |
Other comprehensive loss: | ||
Foreign currency translation adjustment | -782 | 203 |
Comprehensive loss | ($2,193) | ($1,849) |
Net loss per common share | ||
Basic and diluted (in dollars per share) | ($0.18) | ($0.29) |
Weighted average shares used in calculation of net loss per common share | ||
Basic and diluted (in shares) | 7,800 | 7,131 |
CONSOLIDATED_STATEMENTS_OF_OPE1
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Parenthetical) (USD $) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Cost of Sales [Member] | ||
Allocated Share-based Compensation Expense | $2,000 | |
Selling, General and Administrative Expenses [Member] | ||
Allocated Share-based Compensation Expense | $1,055,000 | $737,000 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | ($1,411) | ($2,052) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation | 628 | 670 |
Share-based compensation expense | 1,057 | 737 |
Deferred tax (benefit) expense | -1,121 | 114 |
Discount on note payable | 1,265 | 0 |
Change in fair value of warrants and derivative liabilities | -159 | 0 |
Other | 0 | -75 |
Other changes in operating assets and liabilities: | ||
Accounts receivable, net | -2,121 | 1,261 |
Prepaid and other assets | -408 | -999 |
Trade accounts payable | -140 | 1,008 |
Deferred revenue | 1,138 | -26 |
Inventory | -3,000 | 0 |
Accrued severance liability and related costs | 204 | 1,491 |
Accrued liabilities | -619 | -78 |
Net cash (used in) provided by operating activities | -4,687 | 2,051 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Acquisition of property and equipment | -866 | -525 |
Net cash used in investing activities | -866 | -525 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repurchase of common stock | -67 | -44 |
Borrowing on note payable | 3,269 | 0 |
Issuance of common stock | 2,118 | 43 |
Equity issuance costs | -167 | 0 |
Net cash provided by (used in) financing activities | 5,153 | -1 |
Effect of exchange rate on cash and cash equivalents | -381 | 78 |
Net (decrease) increase in cash and cash equivalents | -781 | 1,603 |
Cash and cash equivalents, beginning of period | 13,780 | 12,177 |
Cash and cash equivalents, end of period | 12,999 | 13,780 |
Supplemental disclosure of cash flow information: | ||
Cash paid during period for interest | 206 | 0 |
Accrued property and equipment additions | 1 | 136 |
Leasehold improvements acquired through lease incentive | $0 | $113 |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
In Thousands, except Share data | ||||||
Balance at Dec. 29, 2012 | $27,011 | $38 | $177,278 | ($142,744) | ($3,545) | ($4,016) |
Balance (in shares) at Dec. 29, 2012 | 7,667,708 | |||||
Shares issued for employee stock purchase plan | 43 | 43 | ||||
Shares issued for employee stock purchase plan (in shares) | 23,674 | |||||
Non-vested stock grants | 0 | 4 | -4 | |||
Non-vested stock grants (in shares) | 800,000 | |||||
Purchases of treasury stock | -44 | -44 | ||||
Share-based compensation expense | 737 | 737 | ||||
Other comprehensive income - Foreign currency translation adjustment | 203 | 203 | ||||
Net loss | -2,052 | -2,052 | ||||
Balance at Dec. 28, 2013 | 25,898 | 42 | 178,054 | -144,796 | -3,589 | -3,813 |
Balance (in shares) at Dec. 28, 2013 | 8,491,382 | |||||
Shares issued for employee stock purchase plan | 117 | 117 | ||||
Shares issued for employee stock purchase plan (in shares) | 51,133 | |||||
Non-vested stock grants | 0 | 1 | -1 | |||
Non-vested stock grants (in shares) | 121,000 | |||||
Non-vested stock forfeitures | 0 | |||||
Non-vested stock forfeitures (in shares) | -13,709 | |||||
Purchases of treasury stock | -67 | -67 | ||||
Share-based compensation expense | 1,057 | 1,057 | ||||
Shares issued for investment agreement | 1,732 | 3 | 1,729 | |||
Shares issued for investment agreement (in shares) | 609,756 | |||||
Warrants issued for investment agreement | 1,040 | 1,040 | ||||
Equity issuance costs | -167 | -167 | ||||
Other comprehensive income - Foreign currency translation adjustment | -782 | -782 | ||||
Net loss | -1,411 | -1,411 | ||||
Balance at Jan. 03, 2015 | $27,417 | $46 | $181,829 | ($146,207) | ($3,656) | ($4,595) |
Balance (in shares) at Jan. 03, 2015 | 9,259,562 |
ORGANIZATION_AND_SUMMARY_OF_SI
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||
Jan. 03, 2015 | |||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block] | 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Nature of Operations - On June 18, 2014, stockholders of The Management Network Group, Inc. approved a proposal to change the name of The Management Network Group, Inc. to Cartesian, Inc. (“Cartesian” or the “Company”). Cartesian was founded in 1990 as a management consulting firm specializing in providing consulting services to the converging communications industry and the financial services firms that support it. A majority of the Company's revenues are from customers in the United States, United Kingdom, and Western Europe. Cartesian's corporate offices are located in Overland Park, Kansas. | |||
Principles of Consolidation - The consolidated financial statements include the accounts of Cartesian and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation. | |||
Name of Subsidiary | Date Formed/Acquired | ||
TMNG Europe Ltd. ("TMNG Europe") | March 19, 1997 | ||
TMNG Canada Ltd. | May 14, 1998 | ||
TMNG.com, Inc. | June 18, 1999 | ||
TMNG Marketing, LLC | September 5, 2000 | ||
TMNG Technologies, Inc. | August 27, 2001 | ||
Cambridge Strategic Management Group, Inc. ("CSMG") | March 6, 2002 | ||
Cambridge Adventis Ltd. | March 17, 2006 | ||
Cartesian Ltd. ("Cartesian Limited") | January 2, 2007 | ||
RVA Consulting, LLC ("RVA") | August 3, 2007 | ||
TWG Consulting, Inc. | October 5, 2007 | ||
Fiscal Year - The Company reports its operating results on a 52/53-week fiscal year basis. The fiscal year end is determined as the Saturday ending nearest December 31. The fiscal year ended January 3, 2015 is a 53-week fiscal year and was comprised of three 13-week quarters with the fourth quarter comprised of 14 weeks. The fiscal year ended December 28, 2013 included 52 weeks of operating results and consisted of four equal 13-week quarters. The fiscal years ended January 3, 2015 and December 28, 2013 are referred to herein as fiscal years 2014 and 2013, respectively. | |||
Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. As described in further detail below, significant estimates include the estimates of costs to complete used to recognize revenues on fixed fee contracts, estimates utilized in measuring the fair value of the Company’s reporting units with goodwill, estimates for fair value on Elutions, Inc. (“Elutions”) instruments, estimates used to determine the ultimate realization of deferred tax assets and estimates used to determine the recoverability of deferred contract costs. | |||
Revenue Recognition - The Company recognizes revenue from time and materials consulting contracts in the period in which its services are performed. In addition to time and materials contracts, the Company also has fixed fee contracts. The Company recognizes revenues on milestone or deliverables-based fixed fee contracts and time and materials contracts not to exceed contract price using the percentage of completion-like method described by Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 605-35," Revenue Recognition - Construction-Type and Production-Type Contracts." For fixed fee contracts where services are not based on providing deliverables or achieving milestones, the Company recognizes revenue on a straight-line basis over the period during which such services are expected to be performed. In connection with some fixed fee contracts, the Company may receive payments from customers that exceed revenues up to that point in time. The Company records the excess of receipts from customers over recognized revenue as deferred revenue. Deferred revenue is classified as a current liability to the extent it is expected to be earned within twelve months from the date of the balance sheet. | |||
The FASB ASC 605-35 percentage-of-completion-like methodology involves recognizing revenue using the percentage of services completed, on a current cumulative cost to total cost basis, using a reasonably consistent profit margin over the period. Due to the longer term nature of these projects, developing the estimates of costs often requires significant judgment. Factors that must be considered in estimating the progress of work completed and ultimate cost of the projects include, but are not limited to, the availability of labor and labor productivity, the nature and complexity of the work to be performed, and the impact of delayed performance. If changes occur in delivery, productivity or other factors used in developing the estimates of costs or revenues, the Company revises its cost and revenue estimates, which may result in increases or decreases in revenues and costs, and such revisions are reflected in income in the period in which the facts that give rise to that revision become known. | |||
The Company develops, installs and supports customer software in addition to the provision of traditional consulting services. The Company recognizes revenue in connection with its software sales agreements under ASC 985-605, utilizing the percentage of completion-like method described in ASC 605- 35. These agreements include software right-to-use licenses ("RTU's") and related customization and implementation services. Due to the long-term nature of the software implementation and the extensive software customization based on normal customer specific requirements, both the RTU’s and implementation services are treated as a single element for revenue recognition purposes. | |||
In addition to the professional services related to the customization and implementation of its software, the Company may also provide post-contract support ("PCS") services, including technical support and maintenance services as well as other professional services not essential to the functionality of the software. For those contracts that include PCS service arrangements which are not essential to the functionality of the software solution, the Company separates the FASB ASC 605-35 software services and PCS services utilizing the multiple-element arrangement model prescribed by FASB ASC 605-25, "Revenue Recognition - Multiple-Element Arrangements ". FASB ASC 605-25 addresses the accounting treatment for an arrangement to provide the delivery or performance of multiple products and/or services where the delivery of a product or system or performance of services may occur at different points in time or over different periods of time. The Company utilizes FASB ASC 605-25 to separate the PCS service elements and allocate total contract consideration to the contract elements based on the relative fair value of those elements utilizing PCS renewal terms as evidence of fair value. Revenues from PCS services are recognized ratably on a straight-line basis over the term of the support and maintenance agreement. | |||
Fair Value Measurement - The Company utilizes the methods of fair value measurement as described in FASB ASC 820, “Fair Value Measurements” to value its financial assets and liabilities, including the financial instruments issued in connection with the Elutions investment agreement. As defined in FASB ASC 820, fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, FASB ASC 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: | |||
Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. | |||
Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. | |||
Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. | |||
In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. | |||
Cash and Cash Equivalents - Cash and cash equivalents include cash on hand, money market investments and short-term investments with original maturities of three months or less when purchased. The carrying amounts of cash and cash equivalents approximates its fair value because of their relatively short-term maturities. | |||
Property and Equipment - Property and equipment are stated at cost or acquisition date fair value less accumulated depreciation. Maintenance and repairs are charged to expense as incurred. Depreciation is based on the estimated useful lives of the assets and is computed using the straight-line method, and capital leases, if any, are amortized on a straight-line basis over the life of the lease. Asset lives range from three to seven years for furniture and fixtures, software and computer equipment. Leasehold improvements are capitalized and amortized over the life of the lease or useful life of the asset, whichever is shorter. The Company reviews long-lived assets to be held and used for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets might not be recoverable in accordance with the provisions of FASB ASC 360, "Property, Plant and Equipment.” No impairments were identified in any period presented. | |||
Managed Services Implementation Revenues and Costs - Managed service arrangements provide for the delivery of a software or technology-based solution to clients over a period of time without the transfer of a license or a software sale to the customer. For long-term managed service agreements, implementation efforts are often necessary to develop the software utilized to deliver the managed service. Costs of such implementation efforts may include internal and external costs for coding or customizing systems and costs for conversion of client data. The Company may invoice its clients for implementation fees at the go-live date of the underlying software. Lump sum implementation fees received from clients are initially deferred and recognized on a pro-rata basis as services are provided. Specific, incremental and direct costs of implementation incurred prior to the services going live are deferred pursuant to FASB ASC 605-35-25 and amortized over the period that the related ongoing services revenue is recognized to the extent that the Company believes the recoverability of the costs from the contract is probable. If a client terminates a managed services arrangement prior to the end of the contract, a loss on the contract may be recorded, if applicable, and any remaining deferred implementation revenues and costs would then be recognized into earnings generally over the remaining service period through the termination date. During the fiscal years ended January 3, 2015 and December 28, 2013, deferred implementation costs related to managed service contracts were $1,119,000 and $560,000, respectively. | |||
Research and Development and Software Development Costs - Software development costs are accounted for in accordance with FASB ASC 985-20, "Software - Costs of Software to Be Sold, Leased, or Marketed" and FASB ASC 350-40, “Intangibles - Goodwill and Other - Internal-Use Software.” Capitalization of software development costs for products to be sold to third parties begins upon the establishment of technological feasibility and ceases when the product is available for general release. The Company capitalizes development costs incurred during the period between the establishment of technological feasibility and the release of the final product to customers if such costs are material. In addition, the Company capitalizes software development costs for internal use software that it does not intend to market to third parties but uses to deliver services. The establishment of technological feasibility and the ongoing assessment of recoverability of capitalized software development costs require considerable judgment by management concerning certain external factors including, but not limited to, the date technological feasibility is reached, anticipated future gross revenue, estimated economic life and changes in software and hardware technologies. During fiscal years 2014 and 2013, $1,020,000 and $525,000, respectively, of these costs were expensed as incurred. During fiscal year 2014, $473,000 of internal use software development costs were capitalized. No software development costs were capitalized during fiscal year 2013. | |||
Goodwill - The Company accounts for goodwill in accordance with the provisions of FASB ASC 350, "Intangibles-Goodwill and Other." Goodwill represents the excess of purchase price over the fair value of net assets acquired in business combinations accounted for as purchases. The Company evaluates goodwill for impairment on an annual basis on the last day of the first fiscal month of the fourth fiscal quarter and whenever events or circumstances indicate that these assets may be impaired. The annual impairment test for fiscal year 2014 was performed as of October 25, 2014. The Company determines impairment by comparing the net assets of each reporting unit to its respective fair value. In the event a reporting unit's carrying value exceeds its fair value, an indication exists that the reporting unit goodwill may be impaired. In this situation, the Company must determine the implied fair value of goodwill by assigning the reporting unit's fair value to each asset and liability of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. An impairment loss is measured by the difference between the goodwill carrying value and the implied fair value. | |||
Fair value of the Company’s reporting units is determined using a combination of the income approach and the market approach. The income approach uses a reporting unit's projection of estimated cash flows discounted using a weighted-average cost of capital analysis that reflects current market conditions. The Company also considers the market approach to valuing its reporting units utilizing revenue and EBITDA multiples. The Company compares the results of its overall enterprise valuation as determined by the combination of the two approaches to the Company’s market capitalization. Significant management judgments related to these approaches include: | |||
• | Anticipated future cash flows and terminal value for each reporting unit - The income approach to determining fair value relies on the timing and estimates of future cash flows, including an estimate of terminal value. The projections use management's estimates of economic and market conditions over the projected period including growth rates in revenues and estimates of expected changes in operating margins. The Company’s projections of future cash flows are subject to change as actual results are achieved that differ from those anticipated. Because management frequently updates its projections, the Company would expect to identify on a timely basis any significant differences between actual results and recent estimates. | ||
• | Selection of an appropriate discount rate - The income approach requires the selection of an appropriate discount rate, which is based on a weighted average cost of capital analysis. The discount rate is affected by changes in short-term interest rates and long-term yields as well as variances in the typical capital structure of marketplace participants. The discount rate is determined based on assumptions that would be used by marketplace participants, and for that reason, the capital structure of selected marketplace participants was used in the weighted average cost of capital analysis. Given the current volatile economic conditions, it is possible that the discount rate will fluctuate in the near term. | ||
• | Selection of an appropriate multiple - The market approach requires the selection of an appropriate multiple to apply to revenues or EBITDA based on comparable guideline company or transaction multiples. It is often difficult to identify companies or transactions with a similar profile in regards to revenue, geographic operations, risk profile and other factors. Given the current volatile economic conditions, it is possible that multiples of guideline companies will fluctuate in the near term. | ||
Income Taxes - The Company recognizes a liability or asset for the deferred tax consequences of temporary differences between the tax basis of assets or liabilities and their reported amounts in the financial statements. A valuation allowance is provided when, in the opinion of management, it is more likely than not that some portion or all of a deferred tax asset will not be realized. The Company records the financial statement effects of an income tax position when it is more likely than not that the position will be sustained on the basis of the technical merits. The Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The measurement of any unrecognized tax benefit is based on management’s best judgment. The Company reviews these estimates and makes changes to recorded amounts of uncertain tax positions as facts and circumstances warrant. | |||
Foreign Currency Transactions and Translation - Cartesian Ltd. and the international operations of Cambridge Strategic Management Group, Inc. conduct business primarily denominated in their respective local currency, which is their functional currency. Assets and liabilities have been translated to U.S. dollars at the period-end exchange rates. Revenues and expenses have been translated at exchange rates which approximate the average of the rates prevailing during each period. Translation adjustments are reported as a separate component of accumulated other comprehensive loss in the Consolidated Statements of Stockholders' Equity. Accumulated other comprehensive loss resulting from foreign currency translation adjustments totaled $4.6 million and $3.8 million, respectively as of January 3, 2015 and December 28, 2013, and is included in Total Stockholders’ Equity in the Consolidated Balance Sheets. Assets and liabilities denominated in other than the functional currency of a subsidiary are re-measured at rates of exchange on the balance sheet date. Resulting gains and losses on foreign currency transactions are included in the Company’s results of operations. Realized and unrealized exchange losses included in the results of operations during fiscal 2014 were $349,000 while realized and unrealized exchange gains included in the results of operations during fiscal 2013 were $15,000. | |||
Derivative Financial Instruments - There were no open foreign currency forward contracts as of January 3, 2015 or December 28, 2013. The Company may use forward contracts to provide an economic hedge against fluctuations in accounts receivable denominated in currencies other than its functional currencies, but has not designated such contracts as hedges for accounting purposes. The Company utilizes valuation models for foreign currency forward contracts that rely exclusively on Level 2 inputs, as defined by FASB ASC 820, Fair Value Measurement and Disclosures. Gains and losses on foreign currency forward contracts are included in selling, general and administrative expenses in the Consolidated Statement of Operations and Comprehensive Loss. The change in fair value of foreign currency contracts was not material to the Company's results of operations or financial position for fiscal year 2014 or 2013. Fair value accounting requires bifurcation of certain embedded derivative instruments in certain debt or equity instruments, and measurement at their fair value for accounting purposes. A holder redemption feature embedded in the Company’s note payable was evaluated and it was determined that the holder redemption feature should be bifurcated from its host instrument and accounted for as a freestanding derivative. See Note 2. Strategic Alliance and Investment by Elutions, Inc. for a discussion of this embedded derivative. | |||
Share-Based Compensation - The Company accounts for stock based compensation using the provisions of FASB ASC 718, "Compensation-Stock Compensation" and the SEC's Staff Accounting Bulletin No. 110 ("SAB No. 110") which require the measurement and recognition of compensation expense for all share-based payment awards based on estimated fair values. The Company values its stock options using the Black-Scholes model to determine fair value. See Note 4, Share-Based Compensation. | |||
Loss Per Share - The Company calculates and presents earnings (loss) per share using a dual presentation of basic and diluted earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period. The weighted average number of common shares outstanding excludes treasury shares held by the Company. Diluted earnings (loss) per share is computed in the same manner except that the weighted average number of shares is increased for dilutive securities. | |||
In accordance with the provisions of FASB ASC 260, "Earnings per Share," the Company uses the treasury stock method for calculating the dilutive effect of employee stock options, non-vested shares and warrants. The employee stock options, non-vested shares and warrants will have a dilutive effect under the treasury stock method only when average market value of the underlying Company common stock during the respective period exceeds the assumed proceeds. For share-based payment awards with a performance condition, the Company must first use the guidance on contingently issuable shares in FASB ASC 260-10 to determine whether the awards should be included in the computation of diluted earnings per share for the reporting period. For all non-vested performance-based awards, the Company determines the number of shares, if any, that would be issuable at the end of the reporting period if the end of the reporting period were the end of the contingency period. In applying the treasury stock method, assumed proceeds include the amount, if any, the employee must pay upon exercise, the amount of compensation cost for future services that the Company has not yet recognized, and the amount of tax benefits, if any, that would be credited to additional paid-in capital assuming exercise of the options and the vesting of non-vested shares. For fiscal years 2014 and 2013, approximately 219,000 shares and 72,295 shares, respectively, related to outstanding stock options, non-vested shares and warrants that otherwise would have been included in the diluted earnings per share calculation were not included because they would have been anti-dilutive due to the net loss for those periods. | |||
Accounts Receivable - During fiscal year 2014, the Company entered into an agreement with a third-party financial institution under which it can selectively elect to transfer to the financial institution accounts receivable with one of the Company’s largest, international customers on a non-recourse basis. This agreement gives the Company optionality to convert outstanding accounts receivable to cash. For transfers of accounts receivable under this agreement that qualify as a sale, the Company applies the guidance in ASC 860, “Transfers and Servicing – Sales of Financial Assets”, which requires the derecognition of the carrying value of those accounts receivable on the Consolidated Balance Sheets and recognition of a loss on the sale of an asset in operating expenses on the Consolidated Statements of Operation. As of January 3, 2015, $6.4 million of accounts receivable transferred pursuant to this agreement qualified as sales of receivables and the carrying amount was derecognized. The loss on the sale of these accounts receivable recorded in the Consolidated Statements of Operations was immaterial for fiscal year 2014. | |||
Inventory – In accordance with the provisions of FASB ASC 330, “Inventory,” the Company’s inventory is stated at the lower of cost, using the first-in, first-out (FIFO) method, or fair value. As of January 3, 2015, the Company had $3.0 million in inventory, all of which was finished goods. Provisions for estimated excess and obsolete inventory may be recorded based on reviews of inventory quantities on hand and the latest forecasts of product demand and inventory utilization requirements from customers. There was no provision for estimated excess or obsolete inventory as of January 3, 2015. All inventory was purchased from Elutions, which owns more than five percent of the outstanding shares of common stock of the Company. | |||
Recent Accounting Pronouncements - In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (“FASB ASU 2014-09”). This standard update clarifies the principles for recognizing revenue and develops a common revenue standard for U.S. generally accepted accounting principles (GAAP) and International Financial Reporting Standards. The standard update intends to provide a more robust framework for addressing revenue issues; improve comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets; and provide more useful information to users of financial statements through improved disclosure requirements. Upon adoption of this standard update, the Company expects that the allocation and timing of revenue recognition will be impacted. The provisions of FASB ASU 2014-09 are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, and are to be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. Early application is not permitted. The Company is currently evaluating the impact that this standard update will have on its consolidated financial statements. | |||
In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation-Stock Compensation: Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (“FASB ASU 2014-12”). The standard update resolves the diverse accounting treatment for these share-based payments by requiring that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. The provisions of FASB ASU 2014-12 are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The Company is currently evaluating the impact that this standard update will have on its consolidated financial statements. | |||
STRATEGIC_ALLIANCE_AND_INVESTM
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Investments, All Other Investments [Abstract] | ||||||||||||||
Strategic Alliance And Investment [Text Block] | 2. STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC. | |||||||||||||
Strategic Alliance and Investment by Elutions, Inc. | ||||||||||||||
On February 25, 2014, the Company entered into an investment agreement (the “Investment Agreement”) with Elutions, a provider of operational business intelligence solutions. Under the Investment Agreement, the Company agreed to issue and sell shares of common stock to Elutions and to issue stock purchase warrants to Elutions, and the parties agreed that a subsidiary of Elutions would loan funds to a subsidiary of the Company. On March 18, 2014, the Company and Elutions completed the closing (the "Closing") of the transactions contemplated under the Investment Agreement. | ||||||||||||||
At the Closing, (a) the Company issued and sold 609,756 shares of common stock to Elutions at a price of $3.28 per share, for an aggregate purchase price of $2,000,000, (b) the Company's subsidiary, Cartesian Limited, issued a promissory note (the "Note") payable to Elutions Capital Ventures S.à r.l, a subsidiary of Elutions, in an aggregate original principal amount of $3,268,664, payable in equivalent Great Britain Pounds Sterling, and the Company issued to Elutions a Common Stock Purchase Warrant (Tracking) related to the Note to purchase 996,544 shares of common stock of the Company for $3.28 per share (the "Tracking Warrant"), and (c) the Company issued to Elutions a Common Stock Purchase Warrant (Commercial Incentive) pursuant to which Elutions can earn the right to purchase up to 3,400,000 shares of common stock of the Company at prices ranging from $3.85 per share to $4.85 per share based on the Company's financial results related to certain customer contracts obtained jointly by the Company and Elutions (the "Incentive Warrant"). The Incentive Warrant and the Tracking Warrant are referred to collectively below as the "Warrants". | ||||||||||||||
Promissory Note | ||||||||||||||
The Note issued at Closing by the Company's subsidiary, Cartesian Limited, in the aggregate original principal amount of $3,268,664, bears interest at the rate of 7.825% per year, payable monthly, and matures on March 18, 2019. The Note must be redeemed by Cartesian Limited upon notification by the holder at any time (the “Holder Redemption Option”) and may be prepaid by Cartesian Limited after 18 months if the trading price of the Company's common stock exceeds $5.50 per share for a specified period of time and may be prepaid by Cartesian Limited at any time after 30 months. The obligations of Cartesian Limited under the Note are guaranteed by the Company pursuant to a Guaranty entered into by the Company at Closing and are secured by certain assets relating to client contracts involving Elutions pursuant to a Security Agreement entered into by the Company and Elutions at Closing. Amounts outstanding under the Note may be applied to the exercise price of the Company's common stock under the Tracking Warrant. Upon occurrence of an event of default, the Note would bear interest at 9.825% per year and could be declared immediately due and payable. | ||||||||||||||
Tracking Warrant | ||||||||||||||
Under the Tracking Warrant, Elutions may acquire 996,544 shares of common stock of the Company for $3.28 per share at any time and from time to time through March 18, 2020. The Company may require Elutions to exercise or forfeit the Tracking Warrant at any time (i) after 18 months if the trading price of the Company's common stock exceeds $5.50 per share for a specified period of time and the Company meets certain cash and working capital thresholds and (ii) after 30 months if the Company meets certain cash and working capital thresholds. To the extent amounts are outstanding under the Note, Elutions and the Company (if the Company is requiring exercise of the Tracking Warrant by Elutions as described above) may offset such amounts against the exercise price for shares of common stock acquired under the Tracking Warrant. | ||||||||||||||
Incentive Warrant | ||||||||||||||
Under the Incentive Warrant, Elutions can earn the right to purchase up to 3,400,000 shares of common stock of the Company at prices ranging from $3.85 per share to $4.85 per share based on the Company's financial results as described below. The Incentive Warrant expires on March 18, 2020. The right to exercise the Incentive Warrant to acquire shares is subject to satisfaction of certain performance conditions based on revenues or cash received by the Company under customer contracts acquired jointly with Elutions through a five-year period from March 18, 2014 until March 18, 2019. The Incentive Warrant may vest upon satisfaction of the performance conditions during the five-year period. The number of shares of common stock for which the Incentive Warrant may become exercisable during each year in the five-year period under the vesting provisions is determined by dividing four percent of such revenues and cash recognized or received by the Company in such year by the warrant exercise price per share for that year. In addition, the right to acquire shares may vest at the end of the five-year period for contracts that have been signed and with respect to which revenues are expected to be earned or cash is expected to be received after the end of the five-year period. The exercise price increases $0.25 per year for shares earned in each year of the five-year period and is payable in cash, provided that Elutions has the right to utilize a cashless exercise procedure to acquire shares of common stock under the Incentive Warrant for a limited period of time each year after the right to acquire such shares vests. Any shares utilized to exercise such cashless exercise right will not reduce the maximum number of shares that may be earned and acquired under the Incentive Warrant. | ||||||||||||||
Additional Warrant Provisions | ||||||||||||||
Each of the Warrants has economic anti-dilution protection provisions which provide for adjustments to the exercise price and the number of shares of common stock which may be acquired pursuant to the Warrants in the event of issuances of shares of common stock by the Company at a price less than the 30-day volume weighted average trading price at the time of issuance, subject to a number of exceptions. Each of the Warrants also permits Elutions (subject to certain exceptions) to purchase shares in future equity offerings made by the Company on a pro rata basis to all stockholders, with such participation right based upon the maximum number of shares that may be purchased under the Warrant. | ||||||||||||||
Registration Rights | ||||||||||||||
At Closing, the Company and Elutions entered into a Registration Rights Agreement (the "Registration Rights Agreement"), pursuant to which the Company has obligations to register for resale the shares of common stock issued under the Investment Agreement and the Warrants. Under the Registration Rights Agreement, the Company granted certain piggyback registration rights to Elutions and agreed to file and maintain a resale shelf registration statement for the benefit of Elutions. The resale shelf registration was filed with the SEC on August 12, 2014 and was declared effective on August 26, 2014. | ||||||||||||||
Commercial Relationship | ||||||||||||||
The Investment Agreement and the agreements and instruments described above are part of a strategic relationship between the Company and Elutions. As part of the strategic relationship, the parties entered into certain commercial framework documents, including a Market Development Agreement and related Inventory Agreement, on February 25, 2014, and enter into client agreements and bilateral agreements from time to time in the ordinary course of business outlining the terms of the parties' commercial relationship with respect to business development and providing products, solutions and services to clients. The parties have agreed to a term of five years, with automatic two-year renewals unless notice is given, and subject to termination rights in certain events. The Company has agreed to restrictions during the term and for two years thereafter in regard to solutions or services that are substantially similar to or competitive with certain solutions or services of Elutions, and each party has agreed not to hire the other party's employees during the same period. | ||||||||||||||
The parties have agreed on a general framework for pursuing, entering into and implementing customer contracts, which includes providing for joint and separate client pursuits and marketing on an initial and ongoing basis, procedures for contracting with clients, procedures for interface between the parties, limited exclusivity requirements of Elutions relating to identified prospects and clients of the Company, intellectual property rights of Elutions to its products and related restrictions, restrictions regarding use of confidential information, limitations on liability of the parties, independent contractor status of the parties, limitations on publicity by the parties, and dispute resolution, including arbitration. The parties have also agreed to a framework for certain initial inventory orders and reorders by the Company from Elutions, and related commitments, timing and pricing procedures, when the Company is the prime contracting party under certain client statements of work. The parties intend that specific pricing and allocation provisions and other specific commercial terms will be included in individual client statements of work, subject to certain gross margin requirements for the benefit of the Company. During the third quarter of 2014, the Company acquired $3.0 million in inventory, all of which was finished goods, from Elutions pursuant to the Inventory Agreement. | ||||||||||||||
Accounting Treatment | ||||||||||||||
The Company measured the fair value of the instruments issued in the transaction as of the closing date, March 18, 2014, as follows: | ||||||||||||||
Fair value of Promissory Note | $ | 3,181,000 | ||||||||||||
Fair value of the Holder Redemption Option | 277,000 | |||||||||||||
Fair value of shares issued | 2,622,000 | |||||||||||||
Fair value of Tracking Warrant | 1,259,000 | |||||||||||||
Total fair value of consideration given | $ | 7,339,000 | ||||||||||||
The fair value of the shares issued was determined using the stock price on the date of grant. The fair value of the Note, the Holder Redemption Option and the Tracking Warrant were determined using a binomial lattice model. The model requires the following inputs: (i) price of the Company’s common stock; (ii) exercise price of the Tracking Warrant; (iii) the expected life of the instrument or derivative; (iv) risk-free interest rate; (v) estimated dividend yield, and (vi) estimated stock volatility. Assumptions used in the calculation require significant management judgment. | ||||||||||||||
The following table sets forth the Level 3 inputs to the binomial lattice model that were used to determine the fair value of the Note, the Holder Redemption Option, and the Tracking Warrant: | ||||||||||||||
January 3, 2015 | Issuance Date | |||||||||||||
Common stock price | $ | 4.25 | $ | 4.3 | ||||||||||
Dividend yield | 0 | % | 0 | % | ||||||||||
Exercise price of Tracking Warrant | $ | 3.28 | $ | 3.28 | ||||||||||
Expected term | 1.75 years | 2.5 years | ||||||||||||
Risk-free interest rate | 1.5 | % | 1.6 | % | ||||||||||
Estimated stock volatility | 45 | % | 35.4 | % | ||||||||||
In addition, the Company determined that the provision of the Note that permits Cartesian Limited to prepay the Note after 18 months if the trading price of the Company's common stock exceeds $5.50 per share for a specified period of time is an embedded derivative asset that requires bifurcation (the “Issuer Call Option”). The Company measured the fair value of the Issuer Call Option using a binomial lattice model. As of March 18, 2014 and January 3, 2015, the fair value of the Issuer Call Option was determined to be immaterial. | ||||||||||||||
The Holder Redemption Option has been determined to be an embedded derivative liability that must be bifurcated and recorded as a liability. In addition, the Company concluded that the Tracking Warrant required liability classification upon issuance. The Holder Redemption Option and Tracking Warrant liabilities were recorded at fair value on the Closing date and as of March 29, 2014, with changes in the fair value recognized in the Consolidated Statements of Operations and Comprehensive Loss. The carrying value and fair value of the Note as of January 3, 2015 were $3,269,000 and $3,089,000, respectively. Because the vesting of the Incentive Warrant is contingent on future services to be provided by Elutions and the achievement of performance conditions by Elutions, the Company has determined that the fair value of the Incentive Warrant should be recognized as an expense over the future periods during which such Warrant is earned by Elutions. On May 8, 2014, the Company and Elutions agreed to amend the Investment Agreement and amend and restate the outstanding Incentive Warrant and Tracking Warrant. The purpose of the amendments was to clarify the intent of certain anti-dilution provisions contained in the instruments. As a result of the amendments and effective on the amendment date, both the Incentive Warrant and Tracking Warrant will thereafter be accounted for as equity. The fair value of the Tracking Warrant was reclassified from liability to equity status during the thirteen weeks ended June 28, 2014. As of the date of the amendment, the fair value of the Tracking Warrant was approximately $1.0 million and that amount was reclassified from Liability for Derivatives within Current Liabilities to Stockholders’ Equity. Because the vesting of the Incentive Warrant is contingent on future services to be provided by Elutions and the achievement of performance conditions by Elutions, the Incentive Warrant had zero fair value as of March 18, 2014, May 8, 2014, and January 3, 2015. The fair value of the Incentive Warrant when earned will be recorded to equity in the future periods during which such warrants are earned by Elutions. The Holder Redemption Option continues to be recorded at fair value as of January 3, 2015, with changes in the fair value recognized in the Consolidated Statements of Operations and Comprehensive Loss. | ||||||||||||||
The proceeds from the transaction were $5,269,000 and were allocated to the instruments as reflected in the table below. The proceeds were allocated to the Holder Redemption Option and the Tracking Warrant based on the fair values of the liabilities. The remaining fair value was allocated to the Note and the shares issued based on their relative fair values. | ||||||||||||||
Embedded Holder Redemption Option derivative liability | $ | 277,000 | ||||||||||||
Tracking Warrant liability | 1,259,000 | |||||||||||||
Total proceeds allocated to liabilities based on fair values | $ | 1,536,000 | ||||||||||||
Promissory Note | $ | 2,004,000 | ||||||||||||
Shares issued | 1,729,000 | |||||||||||||
Total proceeds allocated based on relative fair values | $ | 3,733,000 | ||||||||||||
Total proceeds allocated | $ | 5,269,000 | ||||||||||||
There was a debt discount as a result of the relative fair values of the instruments and the allocation of proceeds to the instruments and derivative. | ||||||||||||||
Face amount of Promissory Note | $ | 3,269,000 | ||||||||||||
Proceeds allocated to Promissory Note | -2,004,000 | |||||||||||||
Debt discount | $ | 1,265,000 | ||||||||||||
Amortization of the debt discount was $1,265,000 during the year ended January 3, 2015. The discount was recognized as Other Expense in the Consolidated Statements of Operations and Comprehensive Loss at the Closing due to the fact that the Note may be called by the holder at any time. | ||||||||||||||
In addition, the Company incurred expenses in the amount of $512,000 during the year ended January 3, 2015, related to the transaction. Transaction costs were allocated between the liability and equity components based on the proportion of the fair value of each component to total proceeds at issuance. Transaction costs of $345,000 were allocated to liabilities and transaction costs of $167,000 were allocated to equity during the year ended January 3, 2015. The transaction costs allocated to liabilities are treated as debt issuance costs and were recognized as Other Expense in the Consolidated Statements of Operations and Comprehensive Income (Loss) at the Closing or in the subsequent period in which they were incurred due to the fact that the Note may be called by the holder at any time. The transaction costs allocated to equity were treated as equity issuance costs and reduced equity at the time of issuance. | ||||||||||||||
The Company measures the Holder Redemption Option at fair value on a recurring basis and recognizes transfers, if any, within the fair value hierarchy at the end of the fiscal quarter in which the change in circumstances that caused the transfer occurred. There have been no transfers between Level 1, 2 or 3 liabilities during the year ended January 3, 2015. | ||||||||||||||
The Company has classified the Holder Redemption Option as a Level 3 liability. The Company reassesses the fair value of this liability on a quarterly basis. Based on that assessment, the Company recognized increases of $60,000 in the fair value of this liability during the year ended January 3, 2015 after the issuance of the Note. | ||||||||||||||
To determine the fair value of the Holder Redemption Option, management evaluates assumptions that require significant judgment. Changes in certain inputs to the valuation model, including the Company’s period end stock price and stock volatility, can have a significant impact on the estimated fair value. The fair value recorded for the Holder Redemption Option may vary significantly from period to period. This variability may result in the actual liability for a period either above or below the estimates recorded in the Company’s consolidated financial statements, resulting in significant fluctuations in other income (expense) as a result of the corresponding non-cash gain or loss recorded. | ||||||||||||||
As of January 3, 2015, liabilities recorded at fair value on a recurring basis consist of the following (in thousands): | ||||||||||||||
Quoted prices in | Significant other | Significant other | ||||||||||||
active markets | observable inputs | unobservable inputs | ||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||
Holder Redemption Option | $ | 337 | - | - | $ | 337 | ||||||||
The following table summarizes changes to the fair value of the Tracking Warrant and Holder Redemption Option, which are Level 3 liabilities (in thousands): | ||||||||||||||
Holder | ||||||||||||||
Tracking | Redemption | |||||||||||||
Warrant | Options | Total | ||||||||||||
Fair value at Closing, March 18, 2014 | $ | 1,259 | $ | 277 | $ | 1,536 | ||||||||
Total unrealized (gains) losses | -219 | 60 | -159 | |||||||||||
Conversion of Tracking Warrant to equity award | -1,040 | - | -1,040 | |||||||||||
Fair value at January 3, 2015 | $ | - | $ | 337 | $ | 337 | ||||||||
GOODWILL
GOODWILL | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||
Goodwill and Intangible Assets Disclosure [Text Block] | 3. GOODWILL | ||||||||||
The changes in the carrying amount of goodwill for the fiscal year ended January3, 2015 are as follows (in thousands): | |||||||||||
North | |||||||||||
America | EMEA | Total | |||||||||
Balance as of December 28, 2013 | $ | 3,947 | $ | 4,278 | $ | 8,225 | |||||
Changes in foreign currency exchange rates | - | -210 | -210 | ||||||||
Balance as of January 3, 2015 | $ | 3,947 | $ | 4,068 | $ | 8,015 | |||||
The Company had gross goodwill and accumulated goodwill impairment losses as of the beginning and end of fiscal years 2014 and 2013 as follows: | |||||||||||
As of | As of | As of | |||||||||
January 3, | December 28, | December 29, | |||||||||
2015 | 2013 | 2012 | |||||||||
Gross balance of goodwill (including foreign currency adjustments) | $ | 67,578 | $ | 67,849 | $ | 67,765 | |||||
Accumulated goodwill impairment losses (including foreign currency adjustments) | -59,563 | -59,624 | -59,605 | ||||||||
Net balance of goodwill | $ | 8,015 | $ | 8,225 | $ | 8,160 | |||||
The Company evaluates goodwill for impairment on an annual basis on the last day of the first fiscal month of the fourth quarter and whenever events or circumstances indicate that these assets may be impaired. The Company performs its impairment testing for goodwill in accordance with FASB ASC 350 "Intangibles-Goodwill and Other." Based on the results of the annual step one impairment test, management concluded that there was no impairment of goodwill during fiscal year 2014 or fiscal year 2013. | |||||||||||
SHAREBASED_COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | 4. SHARE-BASED COMPENSATION | |||||||||||||
The Company estimates the fair value of its stock options and stock issued under the Employee Stock Purchase Plan using the Black-Scholes option pricing model. Groups of employees or non-employee directors that have similar historical and expected exercise behavior are considered separately for valuation purposes. Assumptions used in estimating the fair value of stock options granted include risk-free interest rate, expected life, expected volatility factor, and expected dividend rate. The risk-free interest rate is based on the U.S. Treasury yield at the time of grant for a term equal to the expected life of the stock option; the expected life is determined using the simplified method of estimating the life as allowed under SAB No. 110; and the expected volatility is based on the historical volatility of the Company's stock price for a period of time equal to the expected life of the stock option. | ||||||||||||||
With the exception of the service-based non-vested share awards and the performance-based non-vested share awards discussed below, nearly all of the Company's share-based compensation arrangements utilize graded vesting schedules where a portion of the grant vests annually over a period of two to four years. The Company has a policy of recognizing compensation expense for awards with graded vesting over the requisite service period for each separately vesting portion of the award as if the award was, in-substance, multiple awards. This policy has the effect of accelerating the recognition of expense when compared to a straight-line amortization methodology. | ||||||||||||||
As of January 3, 2015, the Company has two share-based compensation plans under which awards are outstanding, which are described below. The Company recognized an income tax benefit of $61,000 related to share-based compensation arrangements during fiscal year 2014, while no income tax benefit for share-based compensation arrangements was recognized for fiscal year 2013. In addition, no compensation costs related to these arrangements were capitalized in either year. The Company has historically issued and expects to continue to issue new shares to satisfy stock option exercises, vesting of non-vested shares or purchases of shares under the Employee Stock Purchase Plan. | ||||||||||||||
1998 EQUITY INCENTIVE PLAN | ||||||||||||||
The Company's 1998 Equity Incentive Plan, as amended and restated, is a stockholder approved plan, which provides for the granting of incentive stock options and nonqualified stock options to employees, and nonqualified stock options, non-vested stock, and restricted stock units to employees, directors and consultants. The 1998 Plan is scheduled to expire in June 2019. As of January 3, 2015, the Company has 1,405,404 shares of the Company's common stock available for issuance upon exercise of outstanding options or for future awards under the 1998 Plan. | ||||||||||||||
Stock Options | ||||||||||||||
Incentive stock options are granted at an exercise price of not less than market value per share of the common stock on the date of grant as determined by the Board of Directors. Vesting and exercise provisions are determined by the Board of Directors. | ||||||||||||||
As of January 3, 2015, all options granted under the 1998 Plan were non-qualified stock options. Options granted under the 1998 Plan generally become exercisable over a one to four year period beginning on the date of grant. Options granted under the 1998 Plan have a maximum term of ten years. | ||||||||||||||
A summary of the option activity of the Company's 1998 Plan as of January 3, 2015 and changes during the fiscal year then ended is presented below: | ||||||||||||||
Weighted | ||||||||||||||
Weighted | Average | |||||||||||||
Average | Remaining | Aggregate | ||||||||||||
Exercise | Contractual | Intrinsic | ||||||||||||
Shares | Price | Term | Value | |||||||||||
Outstanding at December 28, 2013 | 265,093 | $ | 10.5 | |||||||||||
Granted | 90,000 | $ | 3.95 | |||||||||||
Forfeited/cancelled | -47,340 | $ | 10.78 | |||||||||||
Outstanding at January 3, 2015 | 307,753 | $ | 8.54 | 4.1 years | $ | 47,050 | ||||||||
Options vested and expected to vest at January 3, 2015 | 291,253 | $ | 8.8 | 3.8 years | $ | 41,970 | ||||||||
Options exercisable at January 3, 2015 | 217,753 | $ | 10.43 | 2.0 years | $ | 20,250 | ||||||||
The Company granted 90,000 stock option awards during fiscal year 2014, while no stock option awards were granted during fiscal year 2013. During fiscal year 2014, the Company recorded $85,000 of share-based compensation expense in connection with stock option awards while no expense was recorded for share-based compensation in connection with stock option awards during fiscal year 2013. As of January 3, 2015, there was $78,000 of unrecognized share-based compensation expense, net of estimated forfeitures, related to stock option awards, and this unrecognized expense is expected to be recognized over a weighted average period of 24 months. | ||||||||||||||
Non-vested Shares | ||||||||||||||
Service-Based Non-vested Share Awards - A summary of the status of service-based non-vested share awards issued under the 1998 Plan as of January 3, 2015 and changes during the fiscal year then ended is presented below: | ||||||||||||||
Weighted | ||||||||||||||
Average | ||||||||||||||
Grant Date | ||||||||||||||
Shares | Fair Value per | |||||||||||||
share | ||||||||||||||
Outstanding at December 28, 2013 | - | $ | - | |||||||||||
Granted | 81,000 | $ | 3.93 | |||||||||||
Outstanding at January 3, 2015 | 81,000 | $ | 3.93 | |||||||||||
On March 10, 2014, the Company granted 81,000 shares of non-vested stock that vest solely based on employee service. These shares cliff vest after a one-year service period that commenced on the date of the grant. | ||||||||||||||
The Company’s service-based non-vested share awards are valued at the date of grant based on the closing market price of the Company’s common stock, and are expensed on a graded vesting schedule over the vesting period. During fiscal years 2014 and 2013, the Company recorded $257,000 and $237,000, respectively, of share-based compensation expense in connection with service-based non-vested share awards. As of January 3, 2015, there was an estimated $54,000 of unrecognized share-based compensation expense, net of estimated forfeitures, related to service-based non-vested share awards, and this unrecognized expense is expected to be recognized over a period of 2 months. | ||||||||||||||
Performance-Based Non-vested Share Awards - A summary of the status of performance-based non-vested share awards issued under the 1998 Plan as of January 3, 2015 and changes during the fiscal year then ended is presented below: | ||||||||||||||
Weighted | ||||||||||||||
Average | ||||||||||||||
Grant Date | ||||||||||||||
Fair Value per | ||||||||||||||
Shares | share | |||||||||||||
Outstanding at December 28, 2013 | 800,000 | $ | 3.14 | |||||||||||
Granted | 40,000 | $ | 3.93 | |||||||||||
Vested | -173,292 | $ | 3.14 | |||||||||||
Forfeited | -13,709 | $ | 3.14 | |||||||||||
Outstanding at January 3, 2015 | 652,999 | $ | 3.19 | |||||||||||
On March 10, 2014, the Company granted 40,000 shares of non-vested stock that vest in proportion to the ratio that the Company's "Cumulative Net Non-GAAP EBITDA" achieved over a three-year performance period compares to the Cumulative Net Non-GAAP EBITDA goal of $10.5 million. The first potential vesting date is the Company's earnings release date for its 2015 first fiscal quarter and each subsequent potential vesting date is each of the Company's quarterly earnings release dates thereafter through the release date for the first quarter of 2017. Shares not vested as of the release date for the first quarter of 2017 are forfeited. On April 8, 2013, the Company granted performance-based non-vested share awards for a total of 800,000 shares of Common Stock to various executive officers and employees of the Company that vest in proportion to the ratio that the Company's "Cumulative Net Non-GAAP EBITDA" achieved over a four-year performance period compares to the Cumulative Net Non-GAAP EBITDA goal of $14 million. All 800,000 non-vested shares had a grant date fair value of $3.14 per share. The first potential vesting date was the Company's earnings release date for its 2014 first fiscal quarter and each subsequent potential vesting date is each of the Company's quarterly earnings release dates thereafter through the release date for the first quarter of 2017. Shares not vested as of the release date for the first quarter of 2017 are forfeited. Except for termination of employment in certain circumstances following a change of control, the unvested portion of an award is forfeited upon any termination of employment. Under the terms of an award, vesting is partially accelerated and the award is converted to a time-vested award upon a change of control of the Company. | ||||||||||||||
Share-based compensation cost for performance-based non-vested share awards is measured at the grant date based on the fair value of shares expected to be earned at the end of the performance period, based on the closing market price of the Company’s common stock on the date of grant, and is recognized as expense using the straight-line method over the performance period based upon the probable number of shares expected to vest. The Company estimates and excludes compensation cost related to awards not expected to vest based upon estimated forfeitures. During fiscal years 2014 and 2013, the Company recorded $631,000 and $487,000, respectively, of share-based compensation expense in connection with performance-based non-vested share awards. As of January 3, 2015, there was an estimated $1.4 million of unrecognized share-based compensation expense, net of estimated forfeitures, related to performance-based non-vested share awards. The Company currently expects the performance conditions related to its outstanding performance-based non-vested share awards will be achieved and the unrecognized compensation cost at January 3, 2015 related to performance-based non-vested share awards is expected to be recognized over a period of 27 months. | ||||||||||||||
2000 SUPPLEMENTAL STOCK PLAN | ||||||||||||||
The Supplemental Stock Plan expired May 23, 2010. The outstanding awards issued pursuant to the Supplemental Stock Plan will remain subject to the terms of the Supplemental Stock Plan following expiration of the plan. The Supplemental Stock Plan provided the Company's common stock for the granting of nonqualified stock options to employees and was not subject to stockholder approval. Vesting and exercise provisions were determined by the Board of Directors. Options granted under the plan generally become exercisable over a period of up to four years beginning on the date of grant and have a maximum term of ten years. | ||||||||||||||
A summary of the option activity of the Company's Supplemental Stock Plan as of January 3, 2015 and changes during the fiscal year then ended is presented below: | ||||||||||||||
Weighted | ||||||||||||||
Weighted | Average | |||||||||||||
Average | Remaining | Aggregate | ||||||||||||
Exercise | Contractual | Intrinsic | ||||||||||||
Shares | Price | Term | Value | |||||||||||
Outstanding at December 28, 2013 | 82,600 | $ | 11.33 | |||||||||||
Forfeited/cancelled | - | - | ||||||||||||
Outstanding at January 3, 2015 | 82,600 | $ | 11.33 | 2.4 years | $ | 0 | ||||||||
Options vested and exercisable at January 3, 2015 | 82,600 | $ | 11.33 | 2.4 years | $ | 0 | ||||||||
No awards have been granted under the Supplemental Stock Plan since it expired on May 23, 2010. There were no options exercised during fiscal year 2014 or fiscal year 2013. As of January 3, 2015 there was no remaining unrecognized compensation cost, net of estimated forfeitures, related to the unvested portion of stock options issued under the Supplemental Stock Plan. | ||||||||||||||
EMPLOYEE STOCK PURCHASE PLAN | ||||||||||||||
Under the Employee Stock Purchase Plan (ESPP), shares of the Company's common stock may be purchased at six-month intervals at 85% of the lower of the fair market value on the first day of the enrollment period or on the last day of each six-month period over the subsequent two years. Employees may purchase shares through a payroll deduction program having a value not exceeding 15% of their gross compensation during an offering period. During fiscal years 2014 and 2013, the Company recognized net expense of $84,000 and $13,000, respectively, in connection with FASB ASC 718 associated with the ESPP. | ||||||||||||||
SUPPLEMENTAL_BALANCE_SHEET_INF
SUPPLEMENTAL BALANCE SHEET INFORMATION | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||
Supplemental Balance Sheet Disclosures [Text Block] | 5. SUPPLEMENTAL BALANCE SHEET INFORMATION | |||||||
Accrued payroll, bonuses and related expenses and Other accrued liabilities consist of the following (amounts in thousands): | ||||||||
January 3, 2015 | December 28, 2013 | |||||||
Accrued payroll, bonuses and related expenses | ||||||||
Accrued payroll | $ | 385 | $ | 1,308 | ||||
Accrued bonuses | 2,482 | 1,774 | ||||||
Accrued payroll taxes | 437 | 580 | ||||||
Other | 595 | 587 | ||||||
$ | 3,899 | $ | 4,249 | |||||
Other accrued liabilities | ||||||||
Sales and value-added taxes payable | $ | 382 | $ | 889 | ||||
Other | 604 | 742 | ||||||
$ | 986 | $ | 1,631 | |||||
BUSINESS_SEGMENTS_MAJOR_CUSTOM
BUSINESS SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK | 12 Months Ended | ||||||||||||||||
Jan. 03, 2015 | |||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||
Segment Reporting Disclosure [Text Block] | 6. BUSINESS SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK | ||||||||||||||||
In the first quarter of fiscal year 2014, the Company was internally reorganized to better align the Company’s go-to-market and service delivery capabilities and to maximize opportunities in serving telecommunications, media and technology customers. The three former operating segments within North America (North America Cable and Broadband, North America Telecom and Strategy) were integrated into one operating segment. The EMEA segment is a single reportable, operating segment. In addition, beginning in the first quarter of fiscal year 2014 management of the Company’s United Kingdom strategy practice has been moved from the United States to London and is reflected in the EMEA segment. In addition, certain delivery personnel related costs that were previously not allocated to operating segments are now included in the operating segment results. As a result of this internal realignment, corresponding segment information for prior periods has been restated to conform to the current reportable segment presentation. | |||||||||||||||||
The Company identifies its segments based on the way management organizes the Company to assess performance and make operating decisions regarding the allocation of resources. In accordance with the criteria in FASB ASC 280 "Segment Reporting," the Company has concluded it has three reportable segments: the North America segment, the EMEA segment and the Strategic Alliances segment. The North America and EMEA segments are both single reportable, operating segments that encompass the Company’s operational, technology and software consulting services inside of North America and outside of North America, respectively. Both reportable segments offer management consulting, custom developed software, and technical services. The Strategic Alliances reportable segment is a single, reportable segment that includes the Company’s world-wide commercial activities undertaken with third-party service or solutions providers. | |||||||||||||||||
Management evaluates segment performance based upon income (loss) from operations, excluding share-based compensation (benefits) and depreciation. There were no inter-segment revenues during fiscal years 2014 and 2013. In addition, in its administrative division, entitled "Not Allocated to Segments," the Company accounts for non-operating activity and the costs of providing corporate and other administrative services to all the segments, including, but not limited to, share-based compensation expense, depreciation expense, certain research and development costs, and costs related to the arbitration with the Company’s former Chief Executive Officer. See Note 11, Commitments and Contingencies, for additional discussion of the arbitration costs. Summarized financial information concerning the Company's reportable segments is shown in the following table (amounts in thousands): | |||||||||||||||||
North America | EMEA | Strategic | Not | Total | |||||||||||||
Alliances | Allocated | ||||||||||||||||
to | |||||||||||||||||
Segments | |||||||||||||||||
As of and for the fiscal year ended January 3, 2015: | |||||||||||||||||
Revenues | $ | 34,660 | $ | 36,979 | $ | 36 | $ | - | $ | 71,675 | |||||||
Income (loss) from operations | 9,057 | 6,908 | -1,229 | -15,617 | -881 | ||||||||||||
Total other income (expense) | - | - | - | -1,651 | -1,651 | ||||||||||||
Income (loss) before income tax provision | 9,057 | 6,908 | -1,229 | -17,268 | -2,532 | ||||||||||||
Depreciation | - | - | - | 628 | 628 | ||||||||||||
Total assets | $ | 7,398 | $ | 6,099 | $ | 3,030 | $ | 25,749 | $ | 42,276 | |||||||
As of and for the fiscal year ended December 28, 2013: | |||||||||||||||||
Revenues | $ | 32,731 | $ | 22,640 | $ | - | $ | - | $ | 55,371 | |||||||
Income (loss) from operations | 7,603 | 5,132 | -468 | -14,209 | -1,942 | ||||||||||||
Total other income (expense) | - | - | - | 4 | 4 | ||||||||||||
Income (loss) before income tax provision | 7,603 | 5,132 | -468 | -14,205 | -1,938 | ||||||||||||
Depreciation | - | - | - | 670 | 670 | ||||||||||||
Total assets | $ | 4,522 | $ | 7,194 | $ | - | $ | 25,108 | $ | 36,824 | |||||||
Segment assets, regularly reviewed by management as part of its overall assessment of the segments' performance, include both billed and unbilled trade accounts receivable, net of allowances, inventory, and certain other assets, if applicable. Assets not assigned to segments include cash and cash equivalents, current and non-current investments, property and equipment, goodwill and intangible assets and deferred tax assets, excluding deferred tax assets recognized on accounts receivable reserves, which are assigned to their segments. | |||||||||||||||||
In accordance with the provisions of FASB ASC 280-10, revenues earned in the United States and internationally based on the location where the services are performed are shown in the following table (amounts in thousands): | |||||||||||||||||
Revenues | |||||||||||||||||
Fiscal Year | Fiscal Year | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
United States | $ | 34,125 | $ | 32,845 | |||||||||||||
International: | |||||||||||||||||
United Kingdom | 34,642 | 20,464 | |||||||||||||||
Other | 2,908 | 2,062 | |||||||||||||||
Total | $ | 71,675 | $ | 55,371 | |||||||||||||
In accordance with the provisions of FASB ASC 280-10, long-lived assets, excluding intangible assets, by geographic area are shown in the following table (amounts in thousands): | |||||||||||||||||
Long-Lived Assets | |||||||||||||||||
January 3, | |||||||||||||||||
2015 | December 28, 2013 | ||||||||||||||||
United States | $ | 1,673 | $ | 1,014 | |||||||||||||
United Kingdom | 230 | 338 | |||||||||||||||
Total | $ | 1,903 | $ | 1,352 | |||||||||||||
Major customers in terms of significance to Cartesian's revenues (i.e. in excess of 10% of revenues) for fiscal years 2014 and 2013 and accounts receivable as of January 3, 2015 and December 28, 2013 were as follows (amounts in thousands): | |||||||||||||||||
Revenues | |||||||||||||||||
Fiscal Year 2014 | Fiscal Year 2013 | ||||||||||||||||
North | North | ||||||||||||||||
America | EMEA | America | EMEA | ||||||||||||||
Customer A | $ | 21,995 | $ | 10,719 | |||||||||||||
Customer B | $ | 11,851 | $ | 12,014 | |||||||||||||
Customer C | $ | 7,365 | $ | 3,106 | |||||||||||||
Customer D | $ | 4,986 | $ | 6,347 | |||||||||||||
Accounts Receivable | |||||||||||||||||
January 3, | December 28, | ||||||||||||||||
2015 | 2013 | ||||||||||||||||
Customer A | $ | 2,112 | $ | 4,056 | |||||||||||||
Customer B | $ | 2,783 | $ | 1,756 | |||||||||||||
Customer C | $ | 2,870 | $ | 614 | |||||||||||||
Customer D | $ | 412 | $ | 565 | |||||||||||||
Revenues from the Company's ten most significant customers accounted for approximately 84% and 83% of revenues in fiscal years 2014 and 2013, respectively. | |||||||||||||||||
Substantially all of Cartesian's receivables are obligations of companies in the communications, media and entertainment industries. The Company generally does not require collateral or other security on its accounts receivable. The credit risk on these accounts is controlled through credit approvals, limits and monitoring procedures. The Company records bad debt expense based on judgment about the anticipated default rate on receivables owed to Cartesian at the end of the reporting period. That judgment is based on the Company's uncollected account experience in prior years and the ongoing evaluation of the credit status of Cartesian's customers and the communications industry in general. | |||||||||||||||||
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Property, Plant and Equipment Disclosure [Text Block] | 7. PROPERTY AND EQUIPMENT | |||||||
January 3, | December 28, | |||||||
2015 | 2013 | |||||||
(In thousands) | ||||||||
Furniture and fixtures | $ | 1,725 | $ | 1,703 | ||||
Software and computer equipment | 5,935 | 5,289 | ||||||
Leasehold improvements | 1,522 | 1,537 | ||||||
9,182 | 8,529 | |||||||
Less: Accumulated depreciation | 7,890 | 7,327 | ||||||
$ | 1,292 | $ | 1,202 | |||||
Depreciation expense on property and equipment was $628,000 and $670,000 for fiscal years 2014 and 2013, respectively. | ||||||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||
Income Tax Disclosure [Text Block] | 8. INCOME TAXES | |||||||||||||
For fiscal years 2014 and 2013, income (loss) before income taxes consisted of the following (amounts in thousands): | ||||||||||||||
Fiscal | Fiscal | |||||||||||||
Year | Year | |||||||||||||
2014 | 2013 | |||||||||||||
United States | $ | -5,168 | $ | -3,428 | ||||||||||
Foreign | 2,636 | 1,490 | ||||||||||||
Total income (loss) before income taxes | $ | -2,532 | $ | -1,938 | ||||||||||
For fiscal years 2014 and 2013, the income tax benefit (provision) consists of the following (amounts in thousands): | ||||||||||||||
Fiscal | Fiscal | |||||||||||||
Year | Year | |||||||||||||
2014 | 2013 | |||||||||||||
Federal deferred tax expense, net | $ | -99 | $ | -85 | ||||||||||
State deferred tax expense, net | -37 | -29 | ||||||||||||
Foreign deferred tax benefit, net | 1,257 | - | ||||||||||||
Total deferred tax expense, net | $ | 1,121 | $ | -114 | ||||||||||
For fiscal 2014 and 2013, there was no provision for current tax benefit (expense) due to losses generated within the Company’s domestic operations and the utilization of UK net operating loss carryforwards. | ||||||||||||||
The Company reserved all of its domestic net deferred tax assets as of January 3, 2015 and reserved all of its domestic and international net deferred tax assets as of December 28, 2013 with a valuation allowance in accordance with the provisions of FASB ASC 740, “Income Taxes," which requires an estimation of the realizability of the recorded income tax asset balances. As of January 3, 2015, the Company has recorded $32.1 million of valuation allowances attributable to its domestic net deferred tax assets. | ||||||||||||||
Realization of deferred tax assets is dependent on generating sufficient income in future periods. In evaluating the ability to use its deferred tax assets, the Company considers all positive and negative evidence including the Company's past operating results, the existence of cumulative losses in the most recent three fiscal years and the Company's forecast of future income. In determining future income, the Company is responsible for assumptions utilized including the amount of state, federal and international operating income, the reversal of temporary differences and the implementation of feasible and prudent tax planning strategies. These assumptions require significant judgment about the forecasts of future income and are consistent with the plans and estimates the Company is using to manage the underlying business. | ||||||||||||||
The Company maintained a full valuation allowance against its UK deferred tax assets until the second quarter of 2014, when the Company reached the conclusion that it was appropriate to release the valuation allowance due to the sustained positive operating performance of its UK operations and the availability of expected future taxable income. The Company achieved a cumulative three-year positive pre-tax book income position within its UK operations. The Company also considered forecasts of future operating results and utilization of its UK net operating losses, which do not expire. As a result, the Company recorded a $1.8 million reversal of its deferred tax asset valuation allowance reserves in the second quarter of 2014. | ||||||||||||||
The following is a reconciliation between the benefit (provision) for income taxes and the amounts computed based on loss before income taxes at the statutory federal income tax rate (amounts in thousands): | ||||||||||||||
Fiscal Year 2014 | Fiscal Year 2013 | |||||||||||||
Amount | % | Amount | % | |||||||||||
Computed expected federal income tax benefit | $ | 861 | 34 | $ | 658 | 34 | ||||||||
State income tax benefit, net of federal benefit | 340 | 13.4 | 186 | 9.6 | ||||||||||
Rate differential on foreign operations | 353 | 13.9 | 174 | 8.9 | ||||||||||
Forfeited vested stock options | -75 | -2.9 | -211 | -10.9 | ||||||||||
Tax benefits associated with share-based awards | 61 | 2.4 | - | - | ||||||||||
Adjustment to estimated tax loss carryforward | -434 | -17.1 | -1,734 | -89.6 | ||||||||||
Change in statutory and applicable tax rates | 681 | 26.9 | 771 | 39.8 | ||||||||||
Non-deductible expenses | -694 | -27.4 | -62 | -3.2 | ||||||||||
Other | -3 | -0.1 | -5 | -0.2 | ||||||||||
Change in valuation allowance | 31 | 1.2 | 109 | 5.7 | ||||||||||
Total income tax benefit (expense) | $ | 1,121 | 44.3 | $ | -114 | -5.9 | ||||||||
The significant components of deferred income tax assets and the related balance sheet classifications, as of January 3, 2015 and December 28, 2013, are as follows (amounts in thousands): | ||||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
Current deferred tax assets (liabilities): | ||||||||||||||
Accounts receivable | $ | 46 | $ | 45 | ||||||||||
Accrued expenses | 125 | 109 | ||||||||||||
Valuation allowance | -100 | -154 | ||||||||||||
Current deferred tax assets | $ | 71 | $ | - | ||||||||||
Non-current deferred tax assets (liabilities): | ||||||||||||||
Goodwill and intangible assets | $ | 3,057 | $ | 4,811 | ||||||||||
Share-based compensation expense | 873 | 803 | ||||||||||||
Net operating loss carryforward | 27,178 | 24,265 | ||||||||||||
Other | 274 | 480 | ||||||||||||
Foreign tax credit carryforward | 1,006 | 1,006 | ||||||||||||
Valuation allowance | -32,025 | -31,951 | ||||||||||||
Non-current deferred tax assets (liabilities) | $ | 363 | $ | -586 | ||||||||||
The federal net operating loss carryforward as of January 3, 2015 is scheduled to expire as follows (amounts in thousands): | ||||||||||||||
Amount | Year | |||||||||||||
$ | 1,640 | 2015 | ||||||||||||
5,602 | 2023 | |||||||||||||
9,094 | 2024 | |||||||||||||
7,432 | 2025 | |||||||||||||
9,854 | 2026 | |||||||||||||
5,152 | 2027 | |||||||||||||
1,637 | 2028 | |||||||||||||
3,279 | 2030 | |||||||||||||
4,676 | 2031 | |||||||||||||
4,798 | 2032 | |||||||||||||
5,942 | 2033 | |||||||||||||
10,024 | 2034 | |||||||||||||
Total | $ | 69,130 | ||||||||||||
As of January 3, 2015, the Company has a deferred tax asset of $2.7 million related to various state net operating loss carryforwards. These net operating losses expire at various times between 2015 and 2034. In addition, the Company has a deferred tax asset of $1.0 million related to foreign net operating loss carryforwards as of January 3, 2015, $0.9 million of which have no expiration date. As of January 3, 2015, the Company has net foreign tax credits of $1.0 million. If unutilized, the expiration of these foreign tax credits is $317,000 and $689,000 in fiscal years 2018 and 2019, respectively. The Company has not provided deferred taxes on undistributed earnings of foreign subsidiaries, because it is the Company's intention to reinvest these earnings indefinitely. The determination of the amount of deferred taxes related to investments in foreign subsidiaries that is essentially permanent in nature is not practicable. | ||||||||||||||
The Company analyzes its uncertain tax positions pursuant to the provisions of FASB ASC 740 "Income Taxes" that prescribes a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained based on its technical merit. If the tax position is deemed "more-likely-than-not" to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the taxing authority. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not recognition threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met. | ||||||||||||||
As of January 3, 2015 and December 28, 2013, the Company had no recorded liability for unrecognized tax benefits. | ||||||||||||||
The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various state and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2000. As of January 3, 2015, the Company has no income tax examinations in process. | ||||||||||||||
LEASE_COMMITMENTS
LEASE COMMITMENTS | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
Leases [Abstract] | |||||
Leases of Lessee Disclosure [Text Block] | 9. LEASE COMMITMENTS | ||||
The Company leases office facilities, computer equipment and office furniture under various operating leases expiring at various dates through July 2019. | |||||
Following is a summary of future minimum payments under operating leases that have initial or remaining non-cancellable lease terms at January 3, 2015 (amounts in thousands): | |||||
Operating | |||||
Fiscal Year | Leases | ||||
2015 | $ | 1,515 | |||
2016 | 600 | ||||
2017 | 435 | ||||
2018 | 335 | ||||
2019 | 100 | ||||
Thereafter | - | ||||
Total minimum lease payments | 2,985 | ||||
Future minimum rentals to be received under non-cancellable subleases | -149 | ||||
Minimum lease payments net of amounts to be received under subleases | $ | 2,836 | |||
Total rental expense, net of subtenant rents received, was approximately $1,214,000 and $1,106,000 for fiscal years 2014 and 2013, respectively, and was recorded in selling, general and administrative expenses. The Company recorded $218,000 and $202,000, respectively, in rental income from subtenants during fiscal years 2014 and 2013. Rents received from subtenants are recorded as an offset to rental expense. | |||||
LETTERS_OF_CREDIT
LETTERS OF CREDIT | 12 Months Ended |
Jan. 03, 2015 | |
Letter Of Credit [Abstract] | |
Letter Of Credit [Text Block] | 10. LETTERS OF CREDIT |
In connection with the leasing of office space, the Company provides security deposits in the form of two irrevocable letters of credit with financial institutions for the benefit of the respective landlords. As of both January 3, 2015 and December 28, 2013, the required, total collateral amount was $102,000. The collateral deposited for these letters of credit is included in "Other Noncurrent Assets" on the Company's Consolidated Balance Sheets as of January 3, 2015 and December 28, 2013. No obligation has been recorded in connection with the letters of credit on the Company's Consolidated Balance Sheets as of January 3, 2015 and December 28, 2013. | |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Jan. 03, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | 11. COMMITMENTS AND CONTINGENCIES |
On January 10, 2012, Richard P. Nespola, the Company’s former chief executive officer, former chairman of the board and a former member of the Company’s Board of Directors, filed an action, Richard P. Nespola v. The Management Network Group, Inc. (now known as Cartesian, Inc.), against the Company with the American Arbitration Association. In the action, Mr. Nespola claimed, among other things, that the Company breached his employment agreement and an implied covenant of good faith and fair dealing by: (i) improperly deciding not to renew his employment agreement, and (ii) subsequently deciding to terminate his employment for cause. | |
On March 3, 2014, the arbitrator issued an interim award finding that Mr. Nespola's employment was terminated without cause and that Mr. Nespola was entitled to severance under his employment agreement. Based on the first interim ruling, the Company recorded a liability of $1.5 million for contractual severance at December 28, 2013 related to this action. On July 14, 2014, the arbitrator issued a second interim award in this matter, finding that Mr. Nespola was entitled to: (1) a severance benefits award of $1,468,584; (2) attorneys’ fees and costs; and (3) pre-judgment interest. During the 13-weeks ended June 28, 2014, based upon the second interim award the Company recorded an estimated additional liability of $1.4 million related to attorneys’ fees and costs and pre-judgment interest. | |
On January 8, 2015, the arbitrator issued a final award awarding Mr. Nespola $1,677,832 in attorneys’ fees and costs and on February 17, 2015, the arbitrator modified the Nespola final award as to attorneys’ fees and costs and changed the awarded amount to $1,694,340. Based on the final award, as modified, the Company recorded an additional liability of $0.5 million at January 3, 2015 related to this action. All amounts awarded under the Nespola action have been paid by the Company and the matter is fully resolved. | |
In addition, the Company may become involved in various legal and administrative actions arising in the normal course of business. These could include actions brought by taxing authorities challenging the employment status of consultants utilized by the Company. In addition, future customer bankruptcies could result in additional claims on collected balances for professional services near the bankruptcy filing date. When management has determined that an asset has been impaired or a liability had been incurred related to an action, claim or assessment and the amount of loss can be reasonably estimated, the Company will record a liability for such estimated loss in the appropriate accounting period. The resolution of any of such actions, claims, or the matters described above may have an impact on the financial results for the period in which they occur. | |
COMMON_STOCK_REPURCHASE_PROGRA
COMMON STOCK REPURCHASE PROGRAM | 12 Months Ended |
Jan. 03, 2015 | |
Equity [Abstract] | |
Treasury Stock [Text Block] | 12. COMMON STOCK REPURCHASE PROGRAM |
On February 27, 2014, the Company announced that its Board of Directors had approved a common stock repurchase program under which the Company may repurchase up to $2 million of Company common stock through June 30, 2015. Under the program, repurchases may be made by the Company from time to time in the open market or through privately negotiated transactions depending on market conditions, share price and other factors. The stock repurchase program may be modified or discontinued at any time by the Board of Directors. The Company expects to fund repurchases through cash on hand, future cash flow from operations and future borrowings. In order to facilitate repurchases, the Company entered into a Rule 10b5-1 plan, which permits stock repurchases when the Company might otherwise be precluded from doing so under insider trading laws or because of self-imposed trading blackout periods. As of January 3, 2015, no stock repurchases have been made under this plan. | |
EMPLOYEE_BENEFIT_PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Jan. 03, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Compensation and Employee Benefit Plans [Text Block] | 13. EMPLOYEE BENEFIT PLANS |
The Company offers defined contribution plans to eligible employees. Such employees may contribute a percentage of their annual compensation in accordance with the plans’ guidelines. The plans provide for Company contributions that are subject to maximum limitations as defined by the plans. Company contributions to its defined contribution plans totaled $1.4 million and $1.2 million in the years ended January 3, 2015 and December 28, 2013, respectively. | |
ORGANIZATION_AND_SUMMARY_OF_SI1
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||
Jan. 03, 2015 | |||
Accounting Policies [Abstract] | |||
Consolidation, Policy [Policy Text Block] | Principles of Consolidation - The consolidated financial statements include the accounts of Cartesian and its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation. | ||
Name of Subsidiary | Date Formed/Acquired | ||
TMNG Europe Ltd. ("TMNG Europe") | March 19, 1997 | ||
TMNG Canada Ltd. | May 14, 1998 | ||
TMNG.com, Inc. | June 18, 1999 | ||
TMNG Marketing, LLC | September 5, 2000 | ||
TMNG Technologies, Inc. | August 27, 2001 | ||
Cambridge Strategic Management Group, Inc. ("CSMG") | March 6, 2002 | ||
Cambridge Adventis Ltd. | March 17, 2006 | ||
Cartesian Ltd. ("Cartesian Limited") | January 2, 2007 | ||
RVA Consulting, LLC ("RVA") | August 3, 2007 | ||
TWG Consulting, Inc. | October 5, 2007 | ||
Fiscal Period, Policy [Policy Text Block] | Fiscal Year - The Company reports its operating results on a 52/53-week fiscal year basis. The fiscal year end is determined as the Saturday ending nearest December 31. The fiscal year ended January 3, 2015 is a 53-week fiscal year and was comprised of three 13-week quarters with the fourth quarter comprised of 14 weeks. The fiscal year ended December 28, 2013 included 52 weeks of operating results and consisted of four equal 13-week quarters. The fiscal years ended January 3, 2015 and December 28, 2013 are referred to herein as fiscal years 2014 and 2013, respectively. | ||
Use of Estimates, Policy [Policy Text Block] | Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. As described in further detail below, significant estimates include the estimates of costs to complete used to recognize revenues on fixed fee contracts, estimates utilized in measuring the fair value of the Company’s reporting units with goodwill, estimates for fair value on Elutions, Inc. (“Elutions”) instruments, estimates used to determine the ultimate realization of deferred tax assets and estimates used to determine the recoverability of deferred contract costs. | ||
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition - The Company recognizes revenue from time and materials consulting contracts in the period in which its services are performed. In addition to time and materials contracts, the Company also has fixed fee contracts. The Company recognizes revenues on milestone or deliverables-based fixed fee contracts and time and materials contracts not to exceed contract price using the percentage of completion-like method described by Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 605-35," Revenue Recognition - Construction-Type and Production-Type Contracts." For fixed fee contracts where services are not based on providing deliverables or achieving milestones, the Company recognizes revenue on a straight-line basis over the period during which such services are expected to be performed. In connection with some fixed fee contracts, the Company may receive payments from customers that exceed revenues up to that point in time. The Company records the excess of receipts from customers over recognized revenue as deferred revenue. Deferred revenue is classified as a current liability to the extent it is expected to be earned within twelve months from the date of the balance sheet. | ||
The FASB ASC 605-35 percentage-of-completion-like methodology involves recognizing revenue using the percentage of services completed, on a current cumulative cost to total cost basis, using a reasonably consistent profit margin over the period. Due to the longer term nature of these projects, developing the estimates of costs often requires significant judgment. Factors that must be considered in estimating the progress of work completed and ultimate cost of the projects include, but are not limited to, the availability of labor and labor productivity, the nature and complexity of the work to be performed, and the impact of delayed performance. If changes occur in delivery, productivity or other factors used in developing the estimates of costs or revenues, the Company revises its cost and revenue estimates, which may result in increases or decreases in revenues and costs, and such revisions are reflected in income in the period in which the facts that give rise to that revision become known. | |||
The Company develops, installs and supports customer software in addition to the provision of traditional consulting services. The Company recognizes revenue in connection with its software sales agreements under ASC 985-605, utilizing the percentage of completion-like method described in ASC 605- 35. These agreements include software right-to-use licenses ("RTU's") and related customization and implementation services. Due to the long-term nature of the software implementation and the extensive software customization based on normal customer specific requirements, both the RTU’s and implementation services are treated as a single element for revenue recognition purposes. | |||
In addition to the professional services related to the customization and implementation of its software, the Company may also provide post-contract support ("PCS") services, including technical support and maintenance services as well as other professional services not essential to the functionality of the software. For those contracts that include PCS service arrangements which are not essential to the functionality of the software solution, the Company separates the FASB ASC 605-35 software services and PCS services utilizing the multiple-element arrangement model prescribed by FASB ASC 605-25, "Revenue Recognition - Multiple-Element Arrangements ". FASB ASC 605-25 addresses the accounting treatment for an arrangement to provide the delivery or performance of multiple products and/or services where the delivery of a product or system or performance of services may occur at different points in time or over different periods of time. The Company utilizes FASB ASC 605-25 to separate the PCS service elements and allocate total contract consideration to the contract elements based on the relative fair value of those elements utilizing PCS renewal terms as evidence of fair value. Revenues from PCS services are recognized ratably on a straight-line basis over the term of the support and maintenance agreement. | |||
Fair Value Measurement, Policy [Policy Text Block] | Fair Value Measurement - The Company utilizes the methods of fair value measurement as described in FASB ASC 820, “Fair Value Measurements” to value its financial assets and liabilities, including the financial instruments issued in connection with the Elutions investment agreement. As defined in FASB ASC 820, fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, FASB ASC 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: | ||
Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. | |||
Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. | |||
Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. | |||
In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. | |||
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents - Cash and cash equivalents include cash on hand, money market investments and short-term investments with original maturities of three months or less when purchased. The carrying amounts of cash and cash equivalents approximates its fair value because of their relatively short-term maturities. | ||
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment - Property and equipment are stated at cost or acquisition date fair value less accumulated depreciation. Maintenance and repairs are charged to expense as incurred. Depreciation is based on the estimated useful lives of the assets and is computed using the straight-line method, and capital leases, if any, are amortized on a straight-line basis over the life of the lease. Asset lives range from three to seven years for furniture and fixtures, software and computer equipment. Leasehold improvements are capitalized and amortized over the life of the lease or useful life of the asset, whichever is shorter. The Company reviews long-lived assets to be held and used for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets might not be recoverable in accordance with the provisions of FASB ASC 360, "Property, Plant and Equipment.” No impairments were identified in any period presented. | ||
Managed Services Implementation Revenues and Costs [Policy Text Block] | Managed Services Implementation Revenues and Costs - Managed service arrangements provide for the delivery of a software or technology-based solution to clients over a period of time without the transfer of a license or a software sale to the customer. For long-term managed service agreements, implementation efforts are often necessary to develop the software utilized to deliver the managed service. Costs of such implementation efforts may include internal and external costs for coding or customizing systems and costs for conversion of client data. The Company may invoice its clients for implementation fees at the go-live date of the underlying software. Lump sum implementation fees received from clients are initially deferred and recognized on a pro-rata basis as services are provided. Specific, incremental and direct costs of implementation incurred prior to the services going live are deferred pursuant to FASB ASC 605-35-25 and amortized over the period that the related ongoing services revenue is recognized to the extent that the Company believes the recoverability of the costs from the contract is probable. If a client terminates a managed services arrangement prior to the end of the contract, a loss on the contract may be recorded, if applicable, and any remaining deferred implementation revenues and costs would then be recognized into earnings generally over the remaining service period through the termination date. During the fiscal years ended January 3, 2015 and December 28, 2013, deferred implementation costs related to managed service contracts were $1,119,000 and $560,000, respectively. | ||
Research, Development, and Computer Software, Policy [Policy Text Block] | Research and Development and Software Development Costs - Software development costs are accounted for in accordance with FASB ASC 985-20, "Software - Costs of Software to Be Sold, Leased, or Marketed" and FASB ASC 350-40, “Intangibles - Goodwill and Other - Internal-Use Software.” Capitalization of software development costs for products to be sold to third parties begins upon the establishment of technological feasibility and ceases when the product is available for general release. The Company capitalizes development costs incurred during the period between the establishment of technological feasibility and the release of the final product to customers if such costs are material. In addition, the Company capitalizes software development costs for internal use software that it does not intend to market to third parties but uses to deliver services. The establishment of technological feasibility and the ongoing assessment of recoverability of capitalized software development costs require considerable judgment by management concerning certain external factors including, but not limited to, the date technological feasibility is reached, anticipated future gross revenue, estimated economic life and changes in software and hardware technologies. During fiscal years 2014 and 2013, $1,020,000 and $525,000, respectively, of these costs were expensed as incurred. During fiscal year 2014, $473,000 of internal use software development costs were capitalized. No software development costs were capitalized during fiscal year 2013. | ||
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill - The Company accounts for goodwill in accordance with the provisions of FASB ASC 350, "Intangibles-Goodwill and Other." Goodwill represents the excess of purchase price over the fair value of net assets acquired in business combinations accounted for as purchases. The Company evaluates goodwill for impairment on an annual basis on the last day of the first fiscal month of the fourth fiscal quarter and whenever events or circumstances indicate that these assets may be impaired. The annual impairment test for fiscal year 2014 was performed as of October 25, 2014. The Company determines impairment by comparing the net assets of each reporting unit to its respective fair value. In the event a reporting unit's carrying value exceeds its fair value, an indication exists that the reporting unit goodwill may be impaired. In this situation, the Company must determine the implied fair value of goodwill by assigning the reporting unit's fair value to each asset and liability of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. An impairment loss is measured by the difference between the goodwill carrying value and the implied fair value. | ||
Fair value of the Company’s reporting units is determined using a combination of the income approach and the market approach. The income approach uses a reporting unit's projection of estimated cash flows discounted using a weighted-average cost of capital analysis that reflects current market conditions. The Company also considers the market approach to valuing its reporting units utilizing revenue and EBITDA multiples. The Company compares the results of its overall enterprise valuation as determined by the combination of the two approaches to the Company’s market capitalization. Significant management judgments related to these approaches include: | |||
• | Anticipated future cash flows and terminal value for each reporting unit - The income approach to determining fair value relies on the timing and estimates of future cash flows, including an estimate of terminal value. The projections use management's estimates of economic and market conditions over the projected period including growth rates in revenues and estimates of expected changes in operating margins. The Company’s projections of future cash flows are subject to change as actual results are achieved that differ from those anticipated. Because management frequently updates its projections, the Company would expect to identify on a timely basis any significant differences between actual results and recent estimates. | ||
• | Selection of an appropriate discount rate - The income approach requires the selection of an appropriate discount rate, which is based on a weighted average cost of capital analysis. The discount rate is affected by changes in short-term interest rates and long-term yields as well as variances in the typical capital structure of marketplace participants. The discount rate is determined based on assumptions that would be used by marketplace participants, and for that reason, the capital structure of selected marketplace participants was used in the weighted average cost of capital analysis. Given the current volatile economic conditions, it is possible that the discount rate will fluctuate in the near term. | ||
• | Selection of an appropriate multiple - The market approach requires the selection of an appropriate multiple to apply to revenues or EBITDA based on comparable guideline company or transaction multiples. It is often difficult to identify companies or transactions with a similar profile in regards to revenue, geographic operations, risk profile and other factors. Given the current volatile economic conditions, it is possible that multiples of guideline companies will fluctuate in the near term. | ||
Income Tax, Policy [Policy Text Block] | Income Taxes - The Company recognizes a liability or asset for the deferred tax consequences of temporary differences between the tax basis of assets or liabilities and their reported amounts in the financial statements. A valuation allowance is provided when, in the opinion of management, it is more likely than not that some portion or all of a deferred tax asset will not be realized. The Company records the financial statement effects of an income tax position when it is more likely than not that the position will be sustained on the basis of the technical merits. The Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The measurement of any unrecognized tax benefit is based on management’s best judgment. The Company reviews these estimates and makes changes to recorded amounts of uncertain tax positions as facts and circumstances warrant. | ||
Foreign Currency Transactions and Translations Policy [Policy Text Block] | Foreign Currency Transactions and Translation - Cartesian Ltd. and the international operations of Cambridge Strategic Management Group, Inc. conduct business primarily denominated in their respective local currency, which is their functional currency. Assets and liabilities have been translated to U.S. dollars at the period-end exchange rates. Revenues and expenses have been translated at exchange rates which approximate the average of the rates prevailing during each period. Translation adjustments are reported as a separate component of accumulated other comprehensive loss in the Consolidated Statements of Stockholders' Equity. Accumulated other comprehensive loss resulting from foreign currency translation adjustments totaled $4.6 million and $3.8 million, respectively as of January 3, 2015 and December 28, 2013, and is included in Total Stockholders’ Equity in the Consolidated Balance Sheets. Assets and liabilities denominated in other than the functional currency of a subsidiary are re-measured at rates of exchange on the balance sheet date. Resulting gains and losses on foreign currency transactions are included in the Company’s results of operations. Realized and unrealized exchange losses included in the results of operations during fiscal 2014 were $349,000 while realized and unrealized exchange gains included in the results of operations during fiscal 2013 were $15,000. | ||
Derivatives, Policy [Policy Text Block] | Derivative Financial Instruments - There were no open foreign currency forward contracts as of January 3, 2015 or December 28, 2013. The Company may use forward contracts to provide an economic hedge against fluctuations in accounts receivable denominated in currencies other than its functional currencies, but has not designated such contracts as hedges for accounting purposes. The Company utilizes valuation models for foreign currency forward contracts that rely exclusively on Level 2 inputs, as defined by FASB ASC 820, Fair Value Measurement and Disclosures. Gains and losses on foreign currency forward contracts are included in selling, general and administrative expenses in the Consolidated Statement of Operations and Comprehensive Loss. The change in fair value of foreign currency contracts was not material to the Company's results of operations or financial position for fiscal year 2014 or 2013. Fair value accounting requires bifurcation of certain embedded derivative instruments in certain debt or equity instruments, and measurement at their fair value for accounting purposes. A holder redemption feature embedded in the Company’s note payable was evaluated and it was determined that the holder redemption feature should be bifurcated from its host instrument and accounted for as a freestanding derivative. See Note 2. Strategic Alliance and Investment by Elutions, Inc. for a discussion of this embedded derivative. | ||
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Share-Based Compensation - The Company accounts for stock based compensation using the provisions of FASB ASC 718, "Compensation-Stock Compensation" and the SEC's Staff Accounting Bulletin No. 110 ("SAB No. 110") which require the measurement and recognition of compensation expense for all share-based payment awards based on estimated fair values. The Company values its stock options using the Black-Scholes model to determine fair value. See Note 4, Share-Based Compensation. | ||
Earnings Per Share, Policy [Policy Text Block] | Loss Per Share - The Company calculates and presents earnings (loss) per share using a dual presentation of basic and diluted earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period. The weighted average number of common shares outstanding excludes treasury shares held by the Company. Diluted earnings (loss) per share is computed in the same manner except that the weighted average number of shares is increased for dilutive securities. | ||
In accordance with the provisions of FASB ASC 260, "Earnings per Share," the Company uses the treasury stock method for calculating the dilutive effect of employee stock options, non-vested shares and warrants. The employee stock options, non-vested shares and warrants will have a dilutive effect under the treasury stock method only when average market value of the underlying Company common stock during the respective period exceeds the assumed proceeds. For share-based payment awards with a performance condition, the Company must first use the guidance on contingently issuable shares in FASB ASC 260-10 to determine whether the awards should be included in the computation of diluted earnings per share for the reporting period. For all non-vested performance-based awards, the Company determines the number of shares, if any, that would be issuable at the end of the reporting period if the end of the reporting period were the end of the contingency period. In applying the treasury stock method, assumed proceeds include the amount, if any, the employee must pay upon exercise, the amount of compensation cost for future services that the Company has not yet recognized, and the amount of tax benefits, if any, that would be credited to additional paid-in capital assuming exercise of the options and the vesting of non-vested shares. For fiscal years 2014 and 2013, approximately 219,000 shares and 72,295 shares, respectively, related to outstanding stock options, non-vested shares and warrants that otherwise would have been included in the diluted earnings per share calculation were not included because they would have been anti-dilutive due to the net loss for those periods. | |||
Accounts Receivable [Policy Text Block] | Accounts Receivable - During fiscal year 2014, the Company entered into an agreement with a third-party financial institution under which it can selectively elect to transfer to the financial institution accounts receivable with one of the Company’s largest, international customers on a non-recourse basis. This agreement gives the Company optionality to convert outstanding accounts receivable to cash. For transfers of accounts receivable under this agreement that qualify as a sale, the Company applies the guidance in ASC 860, “Transfers and Servicing – Sales of Financial Assets”, which requires the derecognition of the carrying value of those accounts receivable on the Consolidated Balance Sheets and recognition of a loss on the sale of an asset in operating expenses on the Consolidated Statements of Operation. As of January 3, 2015, $6.4 million of accounts receivable transferred pursuant to this agreement qualified as sales of receivables and the carrying amount was derecognized. The loss on the sale of these accounts receivable recorded in the Consolidated Statements of Operations was immaterial for fiscal year 2014. | ||
Inventory, Policy [Policy Text Block] | Inventory – In accordance with the provisions of FASB ASC 330, “Inventory,” the Company’s inventory is stated at the lower of cost, using the first-in, first-out (FIFO) method, or fair value. As of January 3, 2015, the Company had $3.0 million in inventory, all of which was finished goods. Provisions for estimated excess and obsolete inventory may be recorded based on reviews of inventory quantities on hand and the latest forecasts of product demand and inventory utilization requirements from customers. There was no provision for estimated excess or obsolete inventory as of January 3, 2015. All inventory was purchased from Elutions, which owns more than five percent of the outstanding shares of common stock of the Company. | ||
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements - In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (“FASB ASU 2014-09”). This standard update clarifies the principles for recognizing revenue and develops a common revenue standard for U.S. generally accepted accounting principles (GAAP) and International Financial Reporting Standards. The standard update intends to provide a more robust framework for addressing revenue issues; improve comparability of revenue recognition practices across entities, industries, jurisdictions, and capital markets; and provide more useful information to users of financial statements through improved disclosure requirements. Upon adoption of this standard update, the Company expects that the allocation and timing of revenue recognition will be impacted. The provisions of FASB ASU 2014-09 are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, and are to be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. Early application is not permitted. The Company is currently evaluating the impact that this standard update will have on its consolidated financial statements. | ||
In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation-Stock Compensation: Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (“FASB ASU 2014-12”). The standard update resolves the diverse accounting treatment for these share-based payments by requiring that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. The provisions of FASB ASU 2014-12 are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The Company is currently evaluating the impact that this standard update will have on its consolidated financial statements. | |||
STRATEGIC_ALLIANCE_AND_INVESTM1
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Investments, All Other Investments [Abstract] | ||||||||||||||
Schedule Of Fair Value Instrument [Table Text Block] | The Company measured the fair value of the instruments issued in the transaction as of the closing date, March 18, 2014, as follows: | |||||||||||||
Fair value of Promissory Note | $ | 3,181,000 | ||||||||||||
Fair value of the Holder Redemption Option | 277,000 | |||||||||||||
Fair value of shares issued | 2,622,000 | |||||||||||||
Fair value of Tracking Warrant | 1,259,000 | |||||||||||||
Total fair value of consideration given | $ | 7,339,000 | ||||||||||||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Table Text Block] | The following table sets forth the Level 3 inputs to the binomial lattice model that were used to determine the fair value of the Note, the Holder Redemption Option, and the Tracking Warrant: | |||||||||||||
January 3, 2015 | Issuance Date | |||||||||||||
Common stock price | $ | 4.25 | $ | 4.3 | ||||||||||
Dividend yield | 0 | % | 0 | % | ||||||||||
Exercise price of Tracking Warrant | $ | 3.28 | $ | 3.28 | ||||||||||
Expected term | 1.75 years | 2.5 years | ||||||||||||
Risk-free interest rate | 1.5 | % | 1.6 | % | ||||||||||
Estimated stock volatility | 45 | % | 35.4 | % | ||||||||||
Schedule Of Fair Value Instrument Allocation [Table Text Block] | The proceeds from the transaction were $5,269,000 and were allocated to the instruments as reflected in the table below. The proceeds were allocated to the Holder Redemption Option and the Tracking Warrant based on the fair values of the liabilities. The remaining fair value was allocated to the Note and the shares issued based on their relative fair values. | |||||||||||||
Embedded Holder Redemption Option derivative liability | $ | 277,000 | ||||||||||||
Tracking Warrant liability | 1,259,000 | |||||||||||||
Total proceeds allocated to liabilities based on fair values | $ | 1,536,000 | ||||||||||||
Promissory Note | $ | 2,004,000 | ||||||||||||
Shares issued | 1,729,000 | |||||||||||||
Total proceeds allocated based on relative fair values | $ | 3,733,000 | ||||||||||||
Total proceeds allocated | $ | 5,269,000 | ||||||||||||
Schedule Of Fair Value Instrument Debt Discount [Table Text Block] | There was a debt discount as a result of the relative fair values of the instruments and the allocation of proceeds to the instruments and derivative. | |||||||||||||
Face amount of Promissory Note | $ | 3,269,000 | ||||||||||||
Proceeds allocated to Promissory Note | -2,004,000 | |||||||||||||
Debt discount | $ | 1,265,000 | ||||||||||||
Fair Value, Liabilities Measured on Recurring Basis [Table Text Block] | As of January 3, 2015, liabilities recorded at fair value on a recurring basis consist of the following (in thousands): | |||||||||||||
Quoted prices in | Significant other | Significant other | ||||||||||||
active markets | observable inputs | unobservable inputs | ||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||
Holder Redemption Option | $ | 337 | - | - | $ | 337 | ||||||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | The following table summarizes changes to the fair value of the Tracking Warrant and Holder Redemption Option, which are Level 3 liabilities (in thousands): | |||||||||||||
Holder | ||||||||||||||
Tracking | Redemption | |||||||||||||
Warrant | Options | Total | ||||||||||||
Fair value at Closing, March 18, 2014 | $ | 1,259 | $ | 277 | $ | 1,536 | ||||||||
Total unrealized (gains) losses | -219 | 60 | -159 | |||||||||||
Conversion of Tracking Warrant to equity award | -1,040 | - | -1,040 | |||||||||||
Fair value at January 3, 2015 | $ | - | $ | 337 | $ | 337 | ||||||||
GOODWILL_Tables
GOODWILL (Tables) | 12 Months Ended | ||||||||||
Jan. 03, 2015 | |||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||
Schedule of Goodwill [Table Text Block] | The changes in the carrying amount of goodwill for the fiscal year ended January3, 2015 are as follows (in thousands): | ||||||||||
North | |||||||||||
America | EMEA | Total | |||||||||
Balance as of December 28, 2013 | $ | 3,947 | $ | 4,278 | $ | 8,225 | |||||
Changes in foreign currency exchange rates | - | -210 | -210 | ||||||||
Balance as of January 3, 2015 | $ | 3,947 | $ | 4,068 | $ | 8,015 | |||||
Schedule of Intangible Assets and Goodwill [Table Text Block] | The Company had gross goodwill and accumulated goodwill impairment losses as of the beginning and end of fiscal years 2014 and 2013 as follows: | ||||||||||
As of | As of | As of | |||||||||
January 3, | December 28, | December 29, | |||||||||
2015 | 2013 | 2012 | |||||||||
Gross balance of goodwill (including foreign currency adjustments) | $ | 67,578 | $ | 67,849 | $ | 67,765 | |||||
Accumulated goodwill impairment losses (including foreign currency adjustments) | -59,563 | -59,624 | -59,605 | ||||||||
Net balance of goodwill | $ | 8,015 | $ | 8,225 | $ | 8,160 | |||||
SHAREBASED_COMPENSATION_Tables
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Equity Incentive Plan 1998 [Member] | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | A summary of the option activity of the Company's 1998 Plan as of January 3, 2015 and changes during the fiscal year then ended is presented below: | |||||||||||||
Weighted | ||||||||||||||
Weighted | Average | |||||||||||||
Average | Remaining | Aggregate | ||||||||||||
Exercise | Contractual | Intrinsic | ||||||||||||
Shares | Price | Term | Value | |||||||||||
Outstanding at December 28, 2013 | 265,093 | $ | 10.5 | |||||||||||
Granted | 90,000 | $ | 3.95 | |||||||||||
Forfeited/cancelled | -47,340 | $ | 10.78 | |||||||||||
Outstanding at January 3, 2015 | 307,753 | $ | 8.54 | 4.1 years | $ | 47,050 | ||||||||
Options vested and expected to vest at January 3, 2015 | 291,253 | $ | 8.8 | 3.8 years | $ | 41,970 | ||||||||
Options exercisable at January 3, 2015 | 217,753 | $ | 10.43 | 2.0 years | $ | 20,250 | ||||||||
Service Based Non vested Share Awards [Member] | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||
Schedule of Nonvested Share Activity [Table Text Block] | Service-Based Non-vested Share Awards - A summary of the status of service-based non-vested share awards issued under the 1998 Plan as of January 3, 2015 and changes during the fiscal year then ended is presented below: | |||||||||||||
Weighted | ||||||||||||||
Average | ||||||||||||||
Grant Date | ||||||||||||||
Shares | Fair Value per | |||||||||||||
share | ||||||||||||||
Outstanding at December 28, 2013 | - | $ | - | |||||||||||
Granted | 81,000 | $ | 3.93 | |||||||||||
Outstanding at January 3, 2015 | 81,000 | $ | 3.93 | |||||||||||
Performance Based Non vested Share Awards [Member] | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||
Schedule of Nonvested Share Activity [Table Text Block] | Performance-Based Non-vested Share Awards - A summary of the status of performance-based non-vested share awards issued under the 1998 Plan as of January 3, 2015 and changes during the fiscal year then ended is presented below: | |||||||||||||
Weighted | ||||||||||||||
Average | ||||||||||||||
Grant Date | ||||||||||||||
Fair Value per | ||||||||||||||
Shares | share | |||||||||||||
Outstanding at December 28, 2013 | 800,000 | $ | 3.14 | |||||||||||
Granted | 40,000 | $ | 3.93 | |||||||||||
Vested | -173,292 | $ | 3.14 | |||||||||||
Forfeited | -13,709 | $ | 3.14 | |||||||||||
Outstanding at January 3, 2015 | 652,999 | $ | 3.19 | |||||||||||
Supplemental Stock Plan 2000 [Member] | ||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | A summary of the option activity of the Company's Supplemental Stock Plan as of January 3, 2015 and changes during the fiscal year then ended is presented below: | |||||||||||||
Weighted | ||||||||||||||
Weighted | Average | |||||||||||||
Average | Remaining | Aggregate | ||||||||||||
Exercise | Contractual | Intrinsic | ||||||||||||
Shares | Price | Term | Value | |||||||||||
Outstanding at December 28, 2013 | 82,600 | $ | 11.33 | |||||||||||
Forfeited/cancelled | - | - | ||||||||||||
Outstanding at January 3, 2015 | 82,600 | $ | 11.33 | 2.4 years | $ | 0 | ||||||||
Options vested and exercisable at January 3, 2015 | 82,600 | $ | 11.33 | 2.4 years | $ | 0 | ||||||||
SUPPLEMENTAL_BALANCE_SHEET_INF1
SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||
Schedule of Accrued Liabilities [Table Text Block] | Accrued payroll, bonuses and related expenses and Other accrued liabilities consist of the following (amounts in thousands): | |||||||
January 3, 2015 | December 28, 2013 | |||||||
Accrued payroll, bonuses and related expenses | ||||||||
Accrued payroll | $ | 385 | $ | 1,308 | ||||
Accrued bonuses | 2,482 | 1,774 | ||||||
Accrued payroll taxes | 437 | 580 | ||||||
Other | 595 | 587 | ||||||
$ | 3,899 | $ | 4,249 | |||||
Other accrued liabilities | ||||||||
Sales and value-added taxes payable | $ | 382 | $ | 889 | ||||
Other | 604 | 742 | ||||||
$ | 986 | $ | 1,631 | |||||
BUSINESS_SEGMENTS_MAJOR_CUSTOM1
BUSINESS SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK (Tables) | 12 Months Ended | ||||||||||||||||
Jan. 03, 2015 | |||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Summarized financial information concerning the Company's reportable segments is shown in the following table (amounts in thousands): | ||||||||||||||||
North America | EMEA | Strategic | Not | Total | |||||||||||||
Alliances | Allocated | ||||||||||||||||
to | |||||||||||||||||
Segments | |||||||||||||||||
As of and for the fiscal year ended January 3, 2015: | |||||||||||||||||
Revenues | $ | 34,660 | $ | 36,979 | $ | 36 | $ | - | $ | 71,675 | |||||||
Income (loss) from operations | 9,057 | 6,908 | -1,229 | -15,617 | -881 | ||||||||||||
Total other income (expense) | - | - | - | -1,651 | -1,651 | ||||||||||||
Income (loss) before income tax provision | 9,057 | 6,908 | -1,229 | -17,268 | -2,532 | ||||||||||||
Depreciation | - | - | - | 628 | 628 | ||||||||||||
Total assets | $ | 7,398 | $ | 6,099 | $ | 3,030 | $ | 25,749 | $ | 42,276 | |||||||
As of and for the fiscal year ended December 28, 2013: | |||||||||||||||||
Revenues | $ | 32,731 | $ | 22,640 | $ | - | $ | - | $ | 55,371 | |||||||
Income (loss) from operations | 7,603 | 5,132 | -468 | -14,209 | -1,942 | ||||||||||||
Total other income (expense) | - | - | - | 4 | 4 | ||||||||||||
Income (loss) before income tax provision | 7,603 | 5,132 | -468 | -14,205 | -1,938 | ||||||||||||
Depreciation | - | - | - | 670 | 670 | ||||||||||||
Total assets | $ | 4,522 | $ | 7,194 | $ | - | $ | 25,108 | $ | 36,824 | |||||||
Schedule of Revenue from External Customers by Geographical Areas [Table Text Block] | In accordance with the provisions of FASB ASC 280-10, revenues earned in the United States and internationally based on the location where the services are performed are shown in the following table (amounts in thousands): | ||||||||||||||||
Revenues | |||||||||||||||||
Fiscal Year | Fiscal Year | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
United States | $ | 34,125 | $ | 32,845 | |||||||||||||
International: | |||||||||||||||||
United Kingdom | 34,642 | 20,464 | |||||||||||||||
Other | 2,908 | 2,062 | |||||||||||||||
Total | $ | 71,675 | $ | 55,371 | |||||||||||||
Long-lived Assets by Geographic Areas [Table Text Block] | In accordance with the provisions of FASB ASC 280-10, long-lived assets, excluding intangible assets, by geographic area are shown in the following table (amounts in thousands): | ||||||||||||||||
Long-Lived Assets | |||||||||||||||||
January 3, | |||||||||||||||||
2015 | December 28, 2013 | ||||||||||||||||
United States | $ | 1,673 | $ | 1,014 | |||||||||||||
United Kingdom | 230 | 338 | |||||||||||||||
Total | $ | 1,903 | $ | 1,352 | |||||||||||||
Schedule of Revenue and Accounts Receivable by Major Customers by Reporting Segments [Table Text Block] | Major customers in terms of significance to Cartesian's revenues (i.e. in excess of 10% of revenues) for fiscal years 2014 and 2013 and accounts receivable as of January 3, 2015 and December 28, 2013 were as follows (amounts in thousands): | ||||||||||||||||
Revenues | |||||||||||||||||
Fiscal Year 2014 | Fiscal Year 2013 | ||||||||||||||||
North | North | ||||||||||||||||
America | EMEA | America | EMEA | ||||||||||||||
Customer A | $ | 21,995 | $ | 10,719 | |||||||||||||
Customer B | $ | 11,851 | $ | 12,014 | |||||||||||||
Customer C | $ | 7,365 | $ | 3,106 | |||||||||||||
Customer D | $ | 4,986 | $ | 6,347 | |||||||||||||
Accounts Receivable | |||||||||||||||||
January 3, | December 28, | ||||||||||||||||
2015 | 2013 | ||||||||||||||||
Customer A | $ | 2,112 | $ | 4,056 | |||||||||||||
Customer B | $ | 2,783 | $ | 1,756 | |||||||||||||
Customer C | $ | 2,870 | $ | 614 | |||||||||||||
Customer D | $ | 412 | $ | 565 | |||||||||||||
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended | |||||||
Jan. 03, 2015 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Property, Plant and Equipment [Table Text Block] | January 3, | December 28, | ||||||
2015 | 2013 | |||||||
(In thousands) | ||||||||
Furniture and fixtures | $ | 1,725 | $ | 1,703 | ||||
Software and computer equipment | 5,935 | 5,289 | ||||||
Leasehold improvements | 1,522 | 1,537 | ||||||
9,182 | 8,529 | |||||||
Less: Accumulated depreciation | 7,890 | 7,327 | ||||||
$ | 1,292 | $ | 1,202 | |||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||||||||
Jan. 03, 2015 | ||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||
Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block] | For fiscal years 2014 and 2013, income (loss) before income taxes consisted of the following (amounts in thousands): | |||||||||||||
Fiscal | Fiscal | |||||||||||||
Year | Year | |||||||||||||
2014 | 2013 | |||||||||||||
United States | $ | -5,168 | $ | -3,428 | ||||||||||
Foreign | 2,636 | 1,490 | ||||||||||||
Total income (loss) before income taxes | $ | -2,532 | $ | -1,938 | ||||||||||
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | For fiscal years 2014 and 2013, the income tax benefit (provision) consists of the following (amounts in thousands): | |||||||||||||
Fiscal | Fiscal | |||||||||||||
Year | Year | |||||||||||||
2014 | 2013 | |||||||||||||
Federal deferred tax expense, net | $ | -99 | $ | -85 | ||||||||||
State deferred tax expense, net | -37 | -29 | ||||||||||||
Foreign deferred tax benefit, net | 1,257 | - | ||||||||||||
Total deferred tax expense, net | $ | 1,121 | $ | -114 | ||||||||||
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | The following is a reconciliation between the benefit (provision) for income taxes and the amounts computed based on loss before income taxes at the statutory federal income tax rate (amounts in thousands): | |||||||||||||
Fiscal Year 2014 | Fiscal Year 2013 | |||||||||||||
Amount | % | Amount | % | |||||||||||
Computed expected federal income tax benefit | $ | 861 | 34 | $ | 658 | 34 | ||||||||
State income tax benefit, net of federal benefit | 340 | 13.4 | 186 | 9.6 | ||||||||||
Rate differential on foreign operations | 353 | 13.9 | 174 | 8.9 | ||||||||||
Forfeited vested stock options | -75 | -2.9 | -211 | -10.9 | ||||||||||
Tax benefits associated with share-based awards | 61 | 2.4 | - | - | ||||||||||
Adjustment to estimated tax loss carryforward | -434 | -17.1 | -1,734 | -89.6 | ||||||||||
Change in statutory and applicable tax rates | 681 | 26.9 | 771 | 39.8 | ||||||||||
Non-deductible expenses | -694 | -27.4 | -62 | -3.2 | ||||||||||
Other | -3 | -0.1 | -5 | -0.2 | ||||||||||
Change in valuation allowance | 31 | 1.2 | 109 | 5.7 | ||||||||||
Total income tax benefit (expense) | $ | 1,121 | 44.3 | $ | -114 | -5.9 | ||||||||
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | The significant components of deferred income tax assets and the related balance sheet classifications, as of January 3, 2015 and December 28, 2013, are as follows (amounts in thousands): | |||||||||||||
January 3, | December 28, | |||||||||||||
2015 | 2013 | |||||||||||||
Current deferred tax assets (liabilities): | ||||||||||||||
Accounts receivable | $ | 46 | $ | 45 | ||||||||||
Accrued expenses | 125 | 109 | ||||||||||||
Valuation allowance | -100 | -154 | ||||||||||||
Current deferred tax assets | $ | 71 | $ | - | ||||||||||
Non-current deferred tax assets (liabilities): | ||||||||||||||
Goodwill and intangible assets | $ | 3,057 | $ | 4,811 | ||||||||||
Share-based compensation expense | 873 | 803 | ||||||||||||
Net operating loss carryforward | 27,178 | 24,265 | ||||||||||||
Other | 274 | 480 | ||||||||||||
Foreign tax credit carryforward | 1,006 | 1,006 | ||||||||||||
Valuation allowance | -32,025 | -31,951 | ||||||||||||
Non-current deferred tax assets (liabilities) | $ | 363 | $ | -586 | ||||||||||
Summary of Operating Loss Carryforwards [Table Text Block] | The federal net operating loss carryforward as of January 3, 2015 is scheduled to expire as follows (amounts in thousands): | |||||||||||||
Amount | Year | |||||||||||||
$ | 1,640 | 2015 | ||||||||||||
5,602 | 2023 | |||||||||||||
9,094 | 2024 | |||||||||||||
7,432 | 2025 | |||||||||||||
9,854 | 2026 | |||||||||||||
5,152 | 2027 | |||||||||||||
1,637 | 2028 | |||||||||||||
3,279 | 2030 | |||||||||||||
4,676 | 2031 | |||||||||||||
4,798 | 2032 | |||||||||||||
5,942 | 2033 | |||||||||||||
10,024 | 2034 | |||||||||||||
Total | $ | 69,130 | ||||||||||||
LEASE_COMMITMENTS_Tables
LEASE COMMITMENTS (Tables) | 12 Months Ended | ||||
Jan. 03, 2015 | |||||
Leases [Abstract] | |||||
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | Following is a summary of future minimum payments under operating leases that have initial or remaining non-cancellable lease terms at January 3, 2015 (amounts in thousands): | ||||
Operating | |||||
Fiscal Year | Leases | ||||
2015 | $ | 1,515 | |||
2016 | 600 | ||||
2017 | 435 | ||||
2018 | 335 | ||||
2019 | 100 | ||||
Thereafter | - | ||||
Total minimum lease payments | 2,985 | ||||
Future minimum rentals to be received under non-cancellable subleases | -149 | ||||
Minimum lease payments net of amounts to be received under subleases | $ | 2,836 | |||
ORGANIZATION_AND_SUMMARY_OF_SI2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) (USD $) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Accounting Policies [Line Items] | ||
Implementation Costs | $1,119,000 | $560,000 |
Research and Development Expense, Software (Excluding Acquired in Process Cost) | 1,020,000 | 525,000 |
Foreign currency translation adjustment | 4,595,000 | 3,813,000 |
Foreign Currency Transaction Gain (Loss), before Tax | 349,000 | 15,000 |
Inventory, Finished Goods, Gross | 3,000,000 | |
Capitalized Computer Software, Gross | 473,000 | |
Trade Receivables, Third Party | $6,400,000 | |
Stock Compensation Plan [Member] | ||
Accounting Policies [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 219,000 | 72,295 |
Furniture and Fixtures [Member] | Maximum [Member] | ||
Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Furniture and Fixtures [Member] | Minimum [Member] | ||
Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Software And Computer Equipment [Member] | Maximum [Member] | ||
Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Software And Computer Equipment [Member] | Minimum [Member] | ||
Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years |
STRATEGIC_ALLIANCE_AND_INVESTM2
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC (Details) (USD $) | Jan. 03, 2015 |
Fair Value Instrument [Line Items] | |
Fair value of Promissory Note | $3,181,000 |
Fair value of the Holder Redemption Option | 277,000 |
Fair value of shares issued | 2,622,000 |
Fair value of Tracking Warrant | 1,259,000 |
Total fair value of consideration given | $7,339,000 |
STRATEGIC_ALLIANCE_AND_INVESTM3
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC (Details 1) (USD $) | 12 Months Ended |
Jan. 03, 2015 | |
Fair Value Assumptions And Methodology [Line Items] | |
Common stock price | $4.25 |
Dividend yield | 0.00% |
Exercise price of Tracking Warrant | $3.28 |
Expected term | 1 year 9 months |
Risk-free interest rate | 1.50% |
Estimated stock volatility | 45.00% |
Issuance Date [Member] | |
Fair Value Assumptions And Methodology [Line Items] | |
Common stock price | $4.30 |
Dividend yield | 0.00% |
Exercise price of Tracking Warrant | $3.28 |
Expected term | 2 years 6 months |
Risk-free interest rate | 1.60% |
Estimated stock volatility | 35.40% |
STRATEGIC_ALLIANCE_AND_INVESTM4
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC (Details 2) (USD $) | Jan. 03, 2015 |
Fair Value Instrument Allocation [Line Items] | |
Fair value of the Holder Redemption Option | $277,000 |
Tracking Warrant liability | 1,259,000 |
Total proceeds allocated to liabilities based on fair values | 1,536,000 |
Promissory Note | 2,004,000 |
Shares issued | 1,729,000 |
Total proceeds allocated based on relative fair values | 3,733,000 |
Total proceeds allocated | $5,269,000 |
STRATEGIC_ALLIANCE_AND_INVESTM5
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC (Details 3) (USD $) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Fair Value Instrument Debt Discount [Line Items] | ||
Face amount of Promissory Note | $3,269,000 | $0 |
Proceeds allocated to Promissory Note | -2,004,000 | |
Debt discount | 1,265,000 | 0 |
Promissory Note [Member] | ||
Fair Value Instrument Debt Discount [Line Items] | ||
Face amount of Promissory Note | 3,269,000 | |
Proceeds allocated to Promissory Note | -2,004,000 | |
Debt discount | $1,265,000 |
STRATEGIC_ALLIANCE_AND_INVESTM6
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC (Details 4) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Holder Redemption Option | $337 | $0 |
Holder Redemption Option [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Holder Redemption Option | 337 | |
Holder Redemption Option [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Holder Redemption Option | 0 | |
Holder Redemption Option [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Holder Redemption Option | 0 | |
Holder Redemption Option [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Holder Redemption Option | $337 |
STRATEGIC_ALLIANCE_AND_INVESTM7
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC (Details 5) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Jan. 03, 2015 |
Fair Value Instrument [Line Items] | |
Fair value at Closing, March 18, 2014 | $1,536 |
Total unrealized (gains) losses | -159 |
Conversion of Tracking Warrant to equity award | -1,040 |
Fair value at January 3, 2015 | 337 |
Holder Redemption Option [Member] | |
Fair Value Instrument [Line Items] | |
Fair value at Closing, March 18, 2014 | 277 |
Total unrealized (gains) losses | 60 |
Conversion of Tracking Warrant to equity award | 0 |
Fair value at January 3, 2015 | 337 |
Tracking Warrant [Member] | |
Fair Value Instrument [Line Items] | |
Fair value at Closing, March 18, 2014 | 1,259 |
Total unrealized (gains) losses | -219 |
Conversion of Tracking Warrant to equity award | -1,040 |
Fair value at January 3, 2015 | $0 |
STRATEGIC_ALLIANCE_AND_INVESTM8
STRATEGIC ALLIANCE AND INVESTMENT BY ELUTIONS, INC (Details Textual) (USD $) | 0 Months Ended | 12 Months Ended | 3 Months Ended | |
8-May-14 | Jan. 03, 2015 | Dec. 28, 2013 | Sep. 27, 2014 | |
Embedded Derivative, No Longer Bifurcated, Amount Reclassified to Stockholders' Equity | $1,000,000 | |||
Increase (Decrease) in Derivative Liabilities | 60,000 | |||
Costs Related To Transaction | 512,000 | |||
Transaction Costs Allocated To Liabilities | 345,000 | |||
Transaction Costs Allocated To Equities | 167,000 | |||
Amortization of Debt Discount (Premium) | 1,265,000 | 0 | ||
Proceeds Allocated To Financial Instruments Issued Total | 5,269,000 | |||
Notes Payable, Current | 3,269,000 | 0 | ||
Non Convertible Promissory Note [Member] | ||||
Debt Instrument, Face Amount | 3,268,664 | |||
Debt Instrument, Interest Rate, Stated Percentage | 7.83% | |||
Debt Instrument Debt Default Interest Rate Percentage | 9.83% | |||
Debt Instrument, Maturity Date | 18-Mar-19 | |||
Incentive Warrant [Member] | ||||
Warrants Issued to Purchase Common Stock | 3,400,000 | |||
Warrant [Member] | ||||
Notes Payable, Current | 3,269,000 | |||
Notes Payable, Fair Value Disclosure | 3,089,000 | |||
Elutions, Inc [Member] | Finished Goods [Member] | ||||
Inventory Acquired | 3,000,000 | |||
Elutions, Inc [Member] | Common Stock [Member] | ||||
Stock Issued During Period, Shares, New Issues | 609,756 | |||
Shares Issued, Price Per Share | $3.28 | |||
Stock Issued During Period, Value, New Issues | $2,000,000 | |||
Elutions, Inc [Member] | Tracking Warrant [Member] | ||||
Warrants Issued During Period Exercise Price | $3.28 | |||
Price Per Share Of Stock On Tracking Warrant | $5.50 | |||
Warrants Issued During Period Expiration Date | 18-Mar-20 | |||
Warrants Issued to Purchase Common Stock | 996,544 | |||
Elutions, Inc [Member] | Incentive Warrant [Member] | ||||
Warrants Issued During Period Exercise Price Increases Per Year | $0.25 | |||
Warrants Issued During Period Expiration Date | 18-Mar-20 | |||
Warrants Issued to Purchase Common Stock | 3,400,000 | |||
Elutions, Inc [Member] | Incentive Warrant [Member] | Minimum [Member] | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $3.85 | |||
Elutions, Inc [Member] | Incentive Warrant [Member] | Maximum [Member] | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $4.85 |
GOODWILL_Details
GOODWILL (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 29, 2012 |
Goodwill [Line Items] | ||
Balance as of December 28, 2013 | $8,225 | $8,160 |
Changes in foreign currency exchange rates | -210 | |
Balance as of January 3, 2015 | 8,015 | 8,160 |
North America [Member] | ||
Goodwill [Line Items] | ||
Balance as of December 28, 2013 | 3,947 | |
Changes in foreign currency exchange rates | 0 | |
Balance as of January 3, 2015 | 3,947 | |
EMEA [Member] | ||
Goodwill [Line Items] | ||
Balance as of December 28, 2013 | 4,278 | |
Changes in foreign currency exchange rates | -210 | |
Balance as of January 3, 2015 | $4,068 |
GOODWILL_Details_1
GOODWILL (Details 1) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 29, 2012 |
In Thousands, unless otherwise specified | |||
Goodwill [Line Items] | |||
Gross balance of goodwill (including foreign currency adjustments) | $67,578 | $67,849 | $67,765 |
Accumulated goodwill impairment losses (including foreign currency adjustments) | -59,563 | -59,624 | -59,605 |
Net balance of goodwill | $8,015 | $8,225 | $8,160 |
GOODWILL_Details_Textual
GOODWILL (Details Textual) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Goodwill [Line Items] | ||
Goodwill and Intangible Asset Impairment, Total | $0 | $0 |
SHAREBASED_COMPENSATION_Detail
SHARE-BASED COMPENSATION (Details) (USD $) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Equity Incentive Plan 1998 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares, Outstanding at December 28, 2013 (in shares) | 265,093 | |
Shares, Granted (in shares) | 90,000 | 0 |
Shares, Forfeited/cancelled (in shares) | -47,340 | |
Shares, Outstanding at January 3, 2015 (in shares) | 307,753 | 265,093 |
Shares, Options vested and expected to vest at January 3, 2015 (in shares) | 291,253 | |
Shares, Options exercisable at January 3, 2015 (in shares) | 217,753 | |
Weighted Average Exercise Price, Outstanding at December 28, 2013 (in dollars per share) | $10.50 | |
Weighted Average Exercise Price, Granted (in dollars per share) | $3.95 | |
Weighted Average Exercise Price, Forfeited/cancelled (in dollars per share) | $10.78 | |
Weighted Average Exercise Price, Outstanding at January 3, 2015 (in dollars per share) | $8.54 | $10.50 |
Weighted Average Exercise Price, Options vested and expected to vest at January 3, 2015 (in dollars per share) | $8.80 | |
Weighted Average Exercise Price, Options exercisable at January 3, 2015 (in dollars per share) | $10.43 | |
Weighted Average Remaining Contractual Term, Outstanding at January 3, 2015 | 4 years 1 month 6 days | |
Weighted Average Remaining Contractual Term, Options vested and expected to vest at January 3, 2015 | 3 years 9 months 18 days | |
Weighted Average Remaining Contractual Term, Options exercisable at January 3, 2015 | 2 years | |
Aggregate Instrinsic Value, Outstanding at January 3, 2015 | $47,050 | |
Aggregate Instrinsic Value, Options vested and expected to vest at January 3, 2015 | 41,970 | |
Aggregate Instrinsic Value, Options exercisable at January 3, 2015 | 20,250 | |
Supplemental Stock Plan 2000 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares, Outstanding at December 28, 2013 (in shares) | 82,600 | |
Shares, Forfeited/cancelled (in shares) | 0 | |
Shares, Outstanding at January 3, 2015 (in shares) | 82,600 | |
Shares, Options vested and expected to vest at January 3, 2015 (in shares) | 82,600 | |
Weighted Average Exercise Price, Outstanding at December 28, 2013 (in dollars per share) | $11.33 | |
Weighted Average Exercise Price, Forfeited/cancelled (in dollars per share) | $0 | |
Weighted Average Exercise Price, Outstanding at January 3, 2015 (in dollars per share) | $11.33 | |
Weighted Average Exercise Price, Options vested and expected to vest at January 3, 2015 (in dollars per share) | $11.33 | |
Weighted Average Remaining Contractual Term, Outstanding at January 3, 2015 | 2 years 4 months 24 days | |
Weighted Average Remaining Contractual Term, Options vested and expected to vest at January 3, 2015 | 2 years 4 months 24 days | |
Aggregate Instrinsic Value, Outstanding at January 3, 2015 | 0 | |
Aggregate Instrinsic Value, Options vested and expected to vest at January 3, 2015 | $0 |
SHAREBASED_COMPENSATION_Detail1
SHARE-BASED COMPENSATION (Details 1) (USD $) | 0 Months Ended | 12 Months Ended |
Apr. 08, 2013 | Jan. 03, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares, Granted (in shares) | 800,000 | |
Weighted Average Grant Date Fair Value, Outstanding at January 3, 2015 (in dollars per share) | $3.14 | |
Equity Incentive Plan 1998 [Member] | Service Based Non vested Share Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares, Outstanding at December 28, 2013 (in shares) | 0 | |
Shares, Granted (in shares) | 81,000 | |
Shares, Outstanding at January 3, 2015 (in shares) | 81,000 | |
Weighted Average Grant Date Fair Value, Outstanding at December 28, 2013 (in dollars per share) | $0 | |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | $3.93 | |
Weighted Average Grant Date Fair Value, Outstanding at January 3, 2015 (in dollars per share) | $3.93 | |
Equity Incentive Plan 1998 [Member] | Performance Based Non vested Share Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares, Outstanding at December 28, 2013 (in shares) | 800,000 | |
Shares, Granted (in shares) | 40,000 | |
Shares, Vested (in shares) | -173,292 | |
Shares, Forfeited (in shares) | -13,709 | |
Shares, Outstanding at January 3, 2015 (in shares) | 652,999 | |
Weighted Average Grant Date Fair Value, Outstanding at December 28, 2013 (in dollars per share) | $3.14 | |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | $3.93 | |
Weighted Average Grant Date Fair Value, Vested (in dollars per share) | $3.14 | |
Weighted Average Grant Date Fair Value, Forfeited (in dollars per share) | $3.14 | |
Weighted Average Grant Date Fair Value, Outstanding at January 3, 2015 (in dollars per share) | $3.19 |
SHAREBASED_COMPENSATION_Detail2
SHARE-BASED COMPENSATION (Details Textual) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | |
Apr. 08, 2013 | Jan. 03, 2015 | Dec. 28, 2013 | Mar. 10, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employee Stock Purchase Plan Percentage Of Market Value | 85.00% | |||
Employee Stock Purchase Plan (ESPP) Compensation Expense | $84,000 | $13,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value, Beginning Balance | $3.14 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 800,000 | |||
Earnings Before Income Tax And Dividends | 14,000,000 | |||
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | 61,000 | 0 | ||
Employee Stock Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Allocated Share-based Compensation Expense | 85,000 | 0 | ||
Service Based Non vested Share Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Allocated Share-based Compensation Expense | 257,000 | 237,000 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 months | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | 54,000 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 81,000 | |||
Performance Based Non vested Share Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Allocated Share-based Compensation Expense | 631,000 | 487,000 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 27 months | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | 1,400,000 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 40,000 | |||
Earnings Before Income Tax And Dividends | 10,500,000 | |||
Equity Incentive Plan 1998 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $78,000 | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 24 months | |||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Number of Outstanding Options | 1,405,404 | |||
Stock Option Plan Expiration Period | Jun-19 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 90,000 | 0 | ||
Employee [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Employee Stock Purchase Plan Maximum Allocation Of Base Compensation | 15.00% |
SUPPLEMENTAL_BALANCE_SHEET_INF2
SUPPLEMENTAL BALANCE SHEET INFORMATION (Details) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Accrued payroll, bonuses and related expenses | ||
Accrued payroll | $385 | $1,308 |
Accrued bonuses | 2,482 | 1,774 |
Accrued payroll taxes | 437 | 580 |
Other | 595 | 587 |
Employee-related Liabilities, Current | 3,899 | 4,249 |
Other accrued liabilities | ||
Sales and value-added taxes payable | 382 | 889 |
Other | 604 | 742 |
Other Accrued Liabilities, Current | $986 | $1,631 |
BUSINESS_SEGMENTS_MAJOR_CUSTOM2
BUSINESS SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Segment Reporting Information [Line Items] | ||
Revenues | $71,675 | $55,371 |
Income (loss) from operations | -881 | -1,942 |
Total other income (expense) | -1,651 | 4 |
Income (loss) before income tax provision | -2,532 | -1,938 |
Depreciation | 628 | 670 |
Total assets | 42,276 | 36,824 |
North America [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 34,660 | 32,731 |
Income (loss) from operations | 9,057 | 7,603 |
Income (loss) before income tax provision | 9,057 | 7,603 |
Total assets | 7,398 | 4,522 |
EMEA [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 36,979 | 22,640 |
Income (loss) from operations | 6,908 | 5,132 |
Income (loss) before income tax provision | 6,908 | 5,132 |
Total assets | 6,099 | 7,194 |
Unallocated Amount To Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Income (loss) from operations | -15,617 | -14,209 |
Total other income (expense) | -1,651 | 4 |
Income (loss) before income tax provision | -17,268 | -14,205 |
Depreciation | 628 | 670 |
Total assets | 25,749 | 25,108 |
Strategic Alliances [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 36 | |
Income (loss) from operations | -1,229 | -468 |
Income (loss) before income tax provision | -1,229 | -468 |
Total assets | $3,030 |
BUSINESS_SEGMENTS_MAJOR_CUSTOM3
BUSINESS SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK (Details 1) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Segment Reporting Information [Line Items] | ||
Revenues | $71,675 | $55,371 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 34,125 | 32,845 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 34,642 | 20,464 |
Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | $2,908 | $2,062 |
BUSINESS_SEGMENTS_MAJOR_CUSTOM4
BUSINESS SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK (Details 2) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $1,903 | $1,352 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 1,673 | 1,014 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $230 | $338 |
BUSINESS_SEGMENTS_MAJOR_CUSTOM5
BUSINESS SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK (Details 3) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Segment Reporting Information [Line Items] | ||||
Revenues | $71,675 | $55,371 | ||
Accounts Receivable, Net, Current | 13,527 | 11,716 | ||
Customer A [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Accounts Receivable, Net, Current | 2,112 | 4,056 | ||
Customer B [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Accounts Receivable, Net, Current | 2,783 | 1,756 | ||
Customer C [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Accounts Receivable, Net, Current | 2,870 | 614 | ||
Customer D [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Accounts Receivable, Net, Current | 412 | 565 | ||
North America [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 34,660 | 32,731 | ||
North America [Member] | Customer B [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 11,851 | 12,014 | ||
North America [Member] | Customer D [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 4,986 | 6,347 | ||
EMEA [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 36,979 | 22,640 | ||
EMEA [Member] | Customer A [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 21,995 | 10,719 | ||
EMEA [Member] | Customer C [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | $7,365 | $3,106 |
BUSINESS_SEGMENTS_MAJOR_CUSTOM6
BUSINESS SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS OF CREDIT RISK (Details Textual) (Customer B [Member]) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Customer B [Member] | ||
Segment Reporting Information [Line Items] | ||
Entity Wide Information Percentage Revenue Contribution Top Ten Customers By Revenue Contribution | 84.00% | 83.00% |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $9,182 | $8,529 |
Less: Accumulated depreciation | 7,890 | 7,327 |
Property and equipment, net | 1,292 | 1,202 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 1,725 | 1,703 |
Software and computer equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 5,935 | 5,289 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $1,522 | $1,537 |
PROPERTY_AND_EQUIPMENT_Details1
PROPERTY AND EQUIPMENT (Details Textual) (USD $) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation | $628,000 | $670,000 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Total income (loss) before income taxes | ($2,532) | ($1,938) |
United States [Member] | ||
Total income (loss) before income taxes | -5,168 | -3,428 |
Foreign [Member] | ||
Total income (loss) before income taxes | $2,636 | $1,490 |
INCOME_TAXES_Details_1
INCOME TAXES (Details 1) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Components Of Income Tax Expense Benefit [Line Items] | ||
Federal deferred tax expense, net | ($99) | ($85) |
State deferred tax expense, net | -37 | -29 |
Foreign deferred tax benefit, net | 1,257 | 0 |
Total deferred tax expense, net | $1,121 | ($114) |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Effective Income Tax Rate Reconciliation [Line Items] | ||
Computed expected federal income tax benefit, Amount | $861 | $658 |
State income tax benefit, net of federal benefit, Amount | 340 | 186 |
Rate differential on foreign operations, Amount | 353 | 174 |
Forfeited vested stock options, Amount | -75 | -211 |
Tax benefits associated with share-based awards, Amount | 61 | 0 |
Adjustment to estimated tax loss carryforward, Amount | -434 | -1,734 |
Change in statutory and applicable tax rates, Amount | 681 | 771 |
Non-deductible expenses, Amount | -694 | -62 |
Other, Amount | -3 | -5 |
Change in valuation allowance, Amount | 31 | 109 |
Total deferred tax expense, net | $1,121 | ($114) |
Computed expected federal income tax benefit, Percentage | 34.00% | 34.00% |
State income tax benefit, net of federal benefit, Percentage | 13.40% | 9.60% |
Rate differential on foreign operations, Percentage | 13.90% | 8.90% |
Forfeited vested stock options, Percentage | -2.90% | -10.90% |
Tax benefits associated with share-based awards | 2.40% | 0.00% |
Adjustment to estimated tax loss carryforward, Percentage | -17.10% | -89.60% |
Change in statutory and applicable tax rates, Percentage | 26.90% | 39.80% |
Non-deductible expenses, Percentage | -27.40% | -3.20% |
Other, Percentage | -0.10% | -0.20% |
Change in valuation allowance, Percentage | 1.20% | 5.70% |
Total, Percentage | 44.30% | -5.90% |
INCOME_TAXES_Details_3
INCOME TAXES (Details 3) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Current deferred tax assets (liabilities): | ||
Accounts receivable | $46 | $45 |
Accrued expenses | 125 | 109 |
Valuation allowance | -100 | -154 |
Current deferred tax assets | 71 | 0 |
Non-current deferred tax assets (liabilities): | ||
Goodwill and intangible assets | 3,057 | 4,811 |
Share-based compensation expense | 873 | 803 |
Net operating loss carryforward | 27,178 | 24,265 |
Other | 274 | 480 |
Foreign tax credit carryforward | 1,006 | 1,006 |
Valuation allowance | -32,025 | -31,951 |
Non-current deferred tax assets (liabilities) | $363 | ($586) |
INCOME_TAXES_Details_4
INCOME TAXES (Details 4) (USD $) | Jan. 03, 2015 |
In Thousands, unless otherwise specified | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | $69,130 |
Expiration Year 2015 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 1,640 |
Expiration Year 2023 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 5,602 |
Expiration Year 2024 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 9,094 |
Expiration Year 2025 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 7,432 |
Expiration Year 2026 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 9,854 |
Expiration Year 2027 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 5,152 |
Expiration Year 2028 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 1,637 |
Expiration Year 2030 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 3,279 |
Expiration Year 2031 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 4,676 |
Expiration Year 2032 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 4,798 |
Expiration Year 2033 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | 5,942 |
Expiration Year 2034 [Member] | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss carryforward | $10,024 |
INCOME_TAXES_Details_Textual
INCOME TAXES (Details Textual) (USD $) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Deferred Tax Assets And Liabilities [Line Items] | ||
Deferred Tax Assets, Valuation Allowance | $32,100,000 | |
Deferred Tax Assets, Tax Credit Carryforwards, Foreign | 1,006,000 | 1,006,000 |
Minimum Percentage Of Income Tax Examination Likelihood Of Tax Benefits Being Realized Upon Settlement | 50.00% | |
Deferred Tax Assets, Operating Loss Carryforwards, State and Local | 2,700,000 | |
Deferred Tax Assets, Operating Loss Carryforwards, Foreign | 1,000,000 | |
Net Operating Losses Expiration Period | 2015 and 2034 | |
Valuation Allowance, Deferred Tax Asset, Reversal, Amount | 1,800,000 | |
Deferred Tax Assets, Operating Loss Carryforwards, Not Subject to Expiration | 900,000 | |
Expiration Year 2018 [Member] | ||
Deferred Tax Assets And Liabilities [Line Items] | ||
Deferred Tax Assets, Tax Credit Carryforwards, Foreign | 317,000 | |
Expiration Year 2019 [Member] | ||
Deferred Tax Assets And Liabilities [Line Items] | ||
Deferred Tax Assets, Tax Credit Carryforwards, Foreign | $689,000 |
LEASE_COMMITMENTS_Details
LEASE COMMITMENTS (Details) (USD $) | Jan. 03, 2015 |
In Thousands, unless otherwise specified | |
Operating Leased Assets [Line Items] | |
2015 | $1,515 |
2016 | 600 |
2017 | 435 |
2018 | 335 |
2019 | 100 |
Thereafter | 0 |
Total minimum lease payments | 2,985 |
Future minimum rentals to be received under non-cancellable subleases | -149 |
Minimum lease payments net of amounts to be received under subleases | $2,836 |
LEASE_COMMITMENTS_Details_Text
LEASE COMMITMENTS (Details Textual) (USD $) | 12 Months Ended | |
Jan. 03, 2015 | Dec. 28, 2013 | |
Operating Leased Assets [Line Items] | ||
Lease Expiration Date | 31-Jul-19 | |
Operating Leases, Rent Expense, Net, Total | $1,214,000 | $1,106,000 |
Operating Leases, Rent Expense, Sublease Rentals | $218,000 | $202,000 |
LETTERS_OF_CREDIT_Details_Text
LETTERS OF CREDIT (Details Textual) (USD $) | Jan. 03, 2015 | Dec. 28, 2013 |
Line of Credit Facility [Line Items] | ||
Collateral Amount Net | $102,000 | $102,000 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Details Textual) (USD $) | 12 Months Ended | 0 Months Ended | ||||
Jan. 03, 2015 | Jul. 14, 2014 | Dec. 28, 2013 | Feb. 17, 2015 | Jan. 08, 2015 | Jun. 28, 2014 | |
Loss Contingencies [Line Items] | ||||||
Loss Contingency, Damages Sought, Value | $500,000 | |||||
Accrued Severance Liability | 1,694,000 | 1,491,000 | ||||
Richard P. Nespola [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Severance Benefits | 1,468,584 | |||||
Estimated Litigation Liability | 1,400,000 | |||||
Litigation Liability | $1,677,832 | $1,694,340 |
COMMON_STOCK_REPURCHASE_PROGRA1
COMMON STOCK REPURCHASE PROGRAM (Details Textual) (USD $) | Feb. 27, 2014 |
In Millions, unless otherwise specified | |
Equity, Class of Treasury Stock [Line Items] | |
Stock Repurchase Program, Authorized Amount | $2 |
EMPLOYEE_BENEFIT_PLAN_Details_
EMPLOYEE BENEFIT PLAN (Details Textual) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Jan. 03, 2015 | Dec. 28, 2013 |
Defined Contribution Plan Disclosure [Line Items] | ||
Defined Contribution Plan, Cost Recognized | $1.40 | $1.20 |