Netlist (NLST) 10-K 30 Mar 18 2017 FY Annual report Financial data

Document And Entity Information

Document And Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 30, 2017	Mar. 26, 2018	Jul. 01, 2017
Document And Entity Information [Abstract]
Entity Registrant Name	NETLIST INC
Entity Central Index Key	1,282,631
Document Type	10-K
Document Period End Date	Dec. 30, 2017
Amendment Flag	false
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	FY
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Current Fiscal Year End Date	--12-30
Entity Filer Category	Smaller Reporting Company
Entity Public Float			$ 58
Entity Common Stock, Shares Outstanding		85,415,180

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 30, 2017	Dec. 31, 2016
ASSETS
Cash and cash equivalents	$ 6,720	$ 9,476
Restricted cash	2,800	3,100
Accounts receivable, net of reserves of $44 (2017) and $151 (2016)	2,997	1,751
Inventories	4,105	3,160
Prepaid expenses and other current assets	303	1,766
Total current assets	16,925	19,253
Property and equipment, net	459	645
Other assets	1,406	70
Total assets	18,790	19,968
LIABILITIES AND STOCKHOLDERS' DEFICIT
Accounts payable	6,120	4,028
Revolving line of credit	2,024	676
Accrued payroll and related liabilities	807	1,085
Accrued expenses and other current liabilities	338	270
Notes payable and capital lease obligation, current		151
Total current liabilities	9,289	6,210
Convertible promissory note and accrued interest, net of debt discount	14,766	14,251
Long-term warranty liability	61	36
Total liabilities	24,116	20,497
Commitments and contingencies
Stockholders' deficit:
Preferred stock, $0.001 par value - 10,000 shares authorized: Series A preferred stock, $0.001 par value; 1,000 shares authorized; none issued and outstanding
Common stock, $0.001 par value - 150,000 shares authorized (2017) and 90,000 shares authorized (2016); 79,314 (2017) and 61,653 (2016) shares issued and outstanding	80	62
Additional paid-in capital	152,640	144,035
Accumulated deficit	(158,046)	(144,626)
Total stockholders' deficit	(5,326)	(529)
Total liabilities and stockholders' deficit	$ 18,790	$ 19,968

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 30, 2017	Dec. 31, 2016
Accounts receivable, allowance for doubtful accounts	$ 44	$ 151
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	150,000,000	90,000,000
Common stock, shares issued	79,314,000	61,653,000
Common stock, shares outstanding	79,314,000	61,653,000
Series A Preferred Stock
Preferred stock, shares authorized	1,000,000	1,000,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Condensed Consolidated Statements Of Operations
Net product revenues	$ 38,322	$ 12,798
Non-recurring engineering revenues		6,857
Total net revenues	38,322	19,655
Cost of sales	35,866	12,259
Gross profit	2,456	7,396
Operating expenses:
Research and development	5,231	6,287
Intellectual property legal fees	2,705	3,110
Selling, general and administrative	7,374	9,033
Total operating expenses	15,310	18,430
Operating loss	(12,854)	(11,034)
Other income (expense), net:
Interest expense, net	(564)	(578)
Other income, net	4	386
Total other expense, net	(560)	(192)
Loss before provision for income taxes	(13,414)	(11,226)
Provision for income taxes	6	5
Net loss	$ (13,420)	$ (11,231)
Net loss per common share:
Basic and diluted	$ (0.20)	$ (0.21)
Weighted-average common shares outstanding:
Basic and diluted	65,513	53,784

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Stock-based compensation expense	$ 1,217	$ 1,475
Cost of sales
Stock-based compensation expense	40	64
Research and development
Stock-based compensation expense	348	350
Selling, general and administrative
Stock-based compensation expense	$ 829	$ 1,061

Condensed Consolidated Stateme6

Condensed Consolidated Statements Of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Balance at Jan. 02, 2016	$ 50	$ 132,011	$ (133,395)	$ (1,334)
Balance, shares at Jan. 02, 2016	50,354
Stock-based compensation		1,475		1,475
Exercise of stock options	$ 1	203		$ 204
Exercise of stock options, shares	293			293
Issuance of common stock, net	$ 9	10,321		$ 10,330
Issuance of common stock, shares	9,200
Exercise of warrants	$ 2	25		27
Exercise of warrants, shares	1,806
Net loss			(11,231)	(11,231)
Balance at Dec. 31, 2016	$ 62	144,035	(144,626)	(529)
Balance, shares at Dec. 31, 2016	61,653
Stock-based compensation		1,217		1,217
Exercise of stock options	$ 1	181		$ 182
Exercise of stock options, shares	267			267
Issuance of common stock, net	$ 17	7,207		$ 7,224
Issuance of common stock, shares	17,394
Net loss			(13,420)	(13,420)
Balance at Dec. 30, 2017	$ 80	$ 152,640	$ (158,046)	$ (5,326)
Balance, shares at Dec. 30, 2017	79,314

Condensed Consolidated Stateme7

Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Cash flows from operating activities:
Net loss	$ (13,420)	$ (11,231)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	280	287
Interest accrued on convertible promissory note	299	335
Amortization of debt discount	216	217
Loss on disposal of equipment		1
Stock-based compensation	1,217	1,475
Provision for bad debt	10	81
Changes in operating assets and liabilities:
Restricted cash	300	(2,700)
Accounts receivable	(1,256)	(1,116)
Inventories	(945)	(1,502)
Prepaid expenses and other assets	347	228
Accrued engineering		(500)
Accounts payable	2,092	729
Accrued payroll and related liabilities	(278)	(158)
Accrued expenses and other liabilities	93	(83)
Deferred revenue		(6,857)
Net cash used in operating activities	(11,045)	(20,794)
Cash flows from investing activities:
Acquisition of property and equipment	(94)	(346)
Net cash used in investing activities	(94)	(346)
Cash flows from financing activities:
Net borrowing under line of credit	1,348	676
Payments on debt	(371)	(305)
Proceeds from issuance of common stock, net	7,224	10,330
Proceeds from exercise of stock options and warrants	182	231
Net cash provided by financing activities	8,383	10,932
Net change in cash and cash equivalents	(2,756)	(10,208)
Cash and cash equivalents at beginning of period	9,476	19,684
Cash and cash equivalents at end of period	$ 6,720	$ 9,476

Description of Business

Description of Business	12 Months Ended
	Dec. 30, 2017
Description of Business
Description of Business	Note 1—Description of Business Netlist, Inc. together with its wholly owned subsidiaries (hereinafter collectively referred to as the “Company” or “Netlist,” unless the context or the use of the term indicates otherwise), provides high-performance modular memory subsystems to customers in diverse industries that require enterprise and storage class memory solutions to empower critical business decisions . The Company has a history of introducing disruptive new products, such as one of the first load-reduced dual in-line memory modules (“LRDIMM”) based on its distributed buffer architecture, which has been adopted by the industry for DDR4 LRDIMM. The Company was also one of the first to bring NAND flash memory (“NAND flash”) to the memory channel with its NVvault non-volatile dual in-line memory modules (“NVDIMM”) using software-intensive controllers and merging dynamic random access memory integrated circuits (“DRAM ICs” or “DRAM”) and NAND flash to solve data bottleneck and data retention challenges encountered in high-performance computing environments. The Company recently introduced a new generation of storage class memory products called HybriDIMM to address the growing need for real-time analytics in Big Data applications, in-memory databases, high performance computing and advanced data storage solutions. The Company also resells NAND flash, DRAM products and other component products to end-customers that are not reached in the distribution models of the component manufacturers, including storage customers, appliance customers, system builders and cloud and datacenter customers. Due to the ground-breaking product development of its engineering teams, Netlist has built a robust portfolio of over 100 issued and pending U.S. and foreign patents, many seminal, in the areas of hybrid memory, storage class memory, rank multiplication and load reduction. Since its inception, the Company has dedicated substantial resources to the development, protection and enforcement of technology innovations it believes are essential to its business. The Company’s early pioneering work in these areas has been broadly adopted in industry-standard registered dual in-line memory module (“RDIMM”) LRDIMM and NVDIMM. Netlist’s objective is to continue to innovate in its field and invest further in its intellectual property portfolio, with the goal of monetizing its intellectual property through a combination of product sales and licensing, royalty or other revenue-producing arrangements, which may result from joint development or similar partnerships or defense of the Company’s patents through enforcement actions against parties it believes are infringing them. Netlist was incorporated in June 2000 and is headquartered in Irvine, California. The Company has established a manufacturing facility in the People’s Republic of China (“PRC”), which became operational in July 2007. Liquidity The Company incurred net losses of $13.4 million and $11.2 million for the fiscal years ended December 30, On November 12, 2015, the Company entered into the JDLA with Samsung, pursuant to which the Company and Samsung agreed to work together to jointly develop new storage class memory technologies, including a standardized product interface for NVDIMM-P memory modules, in order to facilitate broad industry adoption of this new technology. In connection with the JDLA, the Company received an $8.0 million NRE fee from Samsung for the joint development and gross proceeds of $15.0 million for its issuance of a Senior Secured Convertible Note (“SVIC Note”) and Stock Purchase Warrant (“SVIC Warrant”) to SVIC No. 28 New Technology Business Investment L.L.P., an affiliate of Samsung Venture Investment Co. (“SVIC”) (see Note 5). On September 23, 2016, the Company completed an underwritten public offering (the “2016 Offering”), pursuant to which it sold 9,200,000 shares of its common stock at a price to the public of $1.25 per share. The net proceeds to the Company from the 2016 Offering were $10.3 million, after deducting underwriting discounts and commissions and offering expenses paid by the Company. On August 22, 2017, the Company completed an underwritten public offering (the “2017 Offering”), pursuant to which it sold 8,500,000 shares of its common stock at a price to the public of $0.60 per share. The net proceeds to the Company from the 2017 Offering were $4.4 million, after deducting underwriting discounts and commissions and offering expenses paid by the Company. On November 14, 2017, the Company entered into an At Market Issuance Sales Agreement (the “Sales Agreement”) with B. Riley FBR, Inc. (the “Agent”) to sell shares of the Company’s common stock, with aggregate gross proceeds of up to $9.0 million, from time to time, through an “at-the-market” equity offering program under which the Agent will act as sales agent (the “ATM Program”) (see Note 8). As of December 30, 2017, the Company had sold 8,894,222 shares of its common stock in the ATM Program for net proceeds of $2.8 million, after deducting sales commissions and other offering expenses paid by the Company. In addition, subsequent to our fiscal year end through March 26, 2018 the Company sold 6,101,312 shares of its common stock for approximate net proceeds of $1.8 million, after deducting sales commissions and other offering expenses paid by the Company. Inadequate working capital would have a material adverse effect on the Company’s business and operations and could cause the Company to fail to execute its business plan, fail to take advantage of future opportunities or fail to respond to competitive pressures or customer requirements. A lack of sufficient funding may also require the Company to significantly modify its business model and/or reduce or cease its operations, which could include implementing cost-cutting measures or delaying, scaling back or eliminating some or all of its ongoing and planned investments in corporate infrastructure, research and development projects, business development initiatives and sales and marketing activities, among other activities. While the Company’s estimates of its operating revenues and expenses and working capital requirements could be incorrect and the Company may use its cash resources faster than it anticipates, management believes the Company’s existing cash balance, together with cash provided by the Company’s operations and borrowing availability under a bank credit facility (see Note 4) and funds raised through the ATM, will be sufficient to meet the Company’s anticipated cash needs for at least the next 12 months.

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 30, 2017
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	Note 2—Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Principles of Consolidation The consolidated financial statements include the accounts of Netlist, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Fiscal Year The Company operates under a 52 or 53 week fiscal year ending on the Saturday closest to December 31. The 2017 and 2016 fiscal years ended on December 30, 2017 and December 31, 2016, respectively, and consisted of 52 weeks. Use of Estimates The preparation of the accompanying consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of net revenues and expenses during the reporting period. By their nature, these estimates and assumptions are subject to an inherent degree of uncertainty. The Company bases its estimates and assumptions on its historical experience, knowledge of current conditions and the Company’s belief of what could occur in the future considering available information. The Company reviews its estimates and assumptions on an ongoing basis. Actual results may differ materially from these estimates, which may result in material adverse effects on the Company’s consolidated operating results and financial position. The Company believes the following critical accounting policies involve its more significant assumptions and estimates used in the preparation of the accompanying consolidated financial statements: provisions for uncollectible receivables and sales returns; warranty liability; valuation of inventories; fair value of financial instruments; recoverability of long-lived assets; valuation of stock-based transactions; estimates for completion of NRE and other revenue milestones and the realization of deferred tax assets. The Company bases its estimates on historical experience, knowledge of current conditions and the Company’s belief of what could occur in the future considering available information. The Company reviews its estimates on an ongoing basis. Actual results may differ materially from these estimates which may result in material adverse effects on the Company’s operating results and financial position. Revenue Recognition The Company generates revenue from sales of products and performance of engineering services. Net Product Revenues Net product revenues consist primarily of resales of NAND flash, DRAM products and other component products to end-customers that are not reached in the distribution models of the component manufacturers, including storage customers, appliance customers, system builders and cloud and datacenter customers, as well as sales of high-performance modular memory subsystems primarily to original equipment manufacturers (“OEMs”) in the server, high-performance computing and communications markets. The Company recognizes revenues in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 605. Accordingly, the Company recognizes revenues when there is persuasive evidence that an arrangement exists, product delivery and acceptance have occurred, the sales price is fixed or determinable, and collectability of the resulting receivable is reasonably assured. The Company generally uses customer purchase orders and/or contracts as evidence of an arrangement. Delivery occurs when goods are shipped for customers with shipping point terms and upon receipt for customers with destination terms, at which time title and risk of loss transfer to the customer. Shipping documents are used to verify delivery and customer acceptance. The Company assesses whether the sales price is fixed or determinable based on the payment terms associated with the transaction and whether the sales price is subject to refund. Customers are generally allowed limited rights of return for up to 30 days, except for sales of excess component inventories, which contain no right-of-return privileges. Estimated returns are provided for at the time of sale based on historical experience or specific identification of an event necessitating a reserve. The Company offers a standard product warranty to customers of its memory subsystem products and has no other post-shipment obligations. The Company assesses collectability based on the creditworthiness of the customer as determined by credit checks and evaluations, as well as the customer’s payment history. All amounts billed to customers related to shipping and handling are classified as net product revenues, while all costs incurred by the Company for shipping and handling are classified as cost of sales. Engineering Services From time-to-time, the Company provides engineering services to its customers. The Company recognizes revenue from these services when all of the following conditions are met: (1) evidence existed of an arrangement with the customer, typically consisting of a purchase order or contract; (2) the Company’s services were performed and risk of loss passed to the customer; (3) the Company completed all of the necessary terms of the contract; (4) the amount of revenue to which the Company was entitled was fixed or determinable; and (5) the Company believed it was probable that it would be able to collect the amount due from the customer. To the extent one or more of these conditions has not been satisfied, the Company defers recognition of revenue. Deferred Revenue From time-to-time, the Company receives pre-payments from its customers related to future services. Engineering development fee revenues, including NRE fees, are deferred and recognized ratably over the period the engineering work is completed. Cash and Cash Equivalents Cash and cash equivalents consist of cash and short-term investments with original maturities of three months or less. Restricted Cash Restricted cash consists of cash to secure standby letters of credit. Restricted cash was $2.8 million as of December 30, 2017 and related to three standby letters of credit, and restricted cash was $3.1 million as of December 31, 2016 and related to two standby letters of credit. Fair Value of Financial Instruments The Company follows ASC Topic 820 to account for the fair value of certain assets and liabilities. ASC Topic 820 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. ASC Topic 820 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC Topic 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. An active market is defined as a market in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company’s financial instruments consist principally of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued expenses, revolving line of credit and convertible promissory note. The Company considers the carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses to approximate the fair value for these financial instruments based upon an evaluation of the underlying characteristics, market data and because of the short period of time between origination of the instruments and their expected realization. The fair value of the Company’s revolving line of credit and convertible promissory note is determined using current applicable rates for similar instruments as of the balance sheet date and an assessment of the credit rating of the Company. The carrying value of the Company’s revolving line of credit at December 30, 2017 approximates fair value because the Company’s interest rate yield is near current market rates for comparable debt instruments. The fair value of the Company’s convertible promissory note was estimated using a discounted cash flow analysis using borrowing rates available to the Company for debt instruments with similar terms and maturities. The Company has determined that the valuation of its convertible promissory note is classified in Level 2 of the fair value hierarchy. The carrying value and estimated fair value of the convertible promissory note as of December 30, 2017 were $14.1 million and $12.3 million, respectively. The carrying value and estimated fair value of the convertible promissory note as of December 31, 2016 were $13.9 million and $12.2 million, respectively. Allowance for Doubtful Accounts The Company performs credit evaluations of its customers’ financial condition and limits the amount of credit extended to its customers as deemed necessary, but generally requires no collateral. The Company evaluates the collectability of accounts receivable based on a combination of factors. In cases where the Company is aware of circumstances that may impair a specific customer’s ability to meet its financial obligations subsequent to the original sale, the Company will record an allowance against amounts due, and thereby reduce the net recognized receivable to the amount the Company reasonably believes will be collected. For all other customers, the Company records allowances for doubtful accounts based primarily on the length of time the receivables are past due based on the terms of the originating transaction, the current business environment, and its historical experience. Uncollectible accounts are charged against the allowance for doubtful accounts when all cost-effective commercial means of collection have been exhausted. Generally, the Company’s credit losses have been within expectations and the provisions established. However, the Company cannot guarantee that it will continue to experience credit loss rates similar to those experienced in the past. The Company’s accounts receivable are generally highly concentrated among a small number of customers, and a significant change in the liquidity or financial position of one of these customers could have a material adverse effect on the collectability of the Company’s accounts receivable, liquidity and future operating results. Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents, and accounts receivable. The Company invests its cash equivalents primarily in money market mutual funds. Cash equivalents are maintained with high quality institutions, the composition and maturities of which are regularly monitored by management. At times, deposits held with financial institutions may exceed the amount of insurance provided by the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation. The Company’s trade accounts receivable are primarily derived from sales to OEMs in the server, high-performance computing and communications markets, as well as from sales to storage customers, appliance customers, system builders and cloud and datacenter customers. The Company performs credit evaluations of its customers’ financial condition and limits the amount of credit extended when deemed necessary, but generally requires no collateral. The Company believes the concentration of credit risk in its trade receivables is moderated by its credit evaluation process, relatively short collection terms, a high level of credit worthiness of its customers (see Note 10), foreign credit insurance, and letters of credit issued in its favor. Reserves are maintained for potential credit losses, and such losses historically have not been significant and have been within management’s expectations. Inventories Inventories are valued at the lower of actual cost to purchase or manufacture the inventory or the net realizable value of the inventory. Cost is determined on an average cost basis which approximates actual cost on a first-in, first-out basis and includes raw materials, labor and manufacturing overhead. Property and Equipment Property and equipment are recorded at cost and depreciated on a straight-line basis over their estimated useful lives, which generally range from three to seven years. Leasehold improvements are recorded at cost and amortized on a straight-line basis over the shorter of their estimated useful lives or the remaining lease term. Expenditures for repairs and maintenance are expensed as incurred. Upon retirement or sale, the cost and related accumulated depreciation and amortization of disposed assets are removed from the accounts and any resulting gain or loss is included in other income, net. Debt Issuance Costs, Debt Discount and Detachable Debt-Related Warrants Costs incurred to issue debt are deferred and recorded as a reduction to the debt balance in the accompanying consolidated balance sheets. The Company amortizes debt issuance costs over the expected term of the related debt using the effective interest method. Debt discounts relate to the relative fair value of warrants issued in conjunction with the debt and are also recorded as a reduction to the debt balance and accreted over the expected term of the debt to interest expense using the effective interest method. Impairment of Long-Lived Assets The Company evaluates the recoverability of the carrying value of long-lived assets held and used by the Company in its operations for impairment on at least an annual basis or whenever events or changes in circumstances indicate that their carrying value may not be recoverable. When such factors and circumstances exist, the Company compares the projected undiscounted future net cash flows associated with the related asset or group of assets over their estimated useful lives against their respective carrying amount. These projected future cash flows may vary significantly over time as a result of increased competition, changes in technology, fluctuations in demand, consolidation of the Company’s customers and reductions in average sales prices. If the carrying value is determined not to be recoverable from future operating cash flows, the asset is deemed impaired and an impairment loss is recognized to the extent the carrying value exceeds the estimated fair value of the asset. The fair value of the asset or asset group is based on market value when available, or when unavailable, on discounted expected cash flows. The Company’s management believes there is no impairment of long-lived assets as of December 30, 2017. However, market conditions could change or demand for products the Company sells could decrease, which could result in future impairment of long-lived assets. Warranty Liability The Company offers product warranties generally ranging from one to three years, depending on the product and negotiated terms of any purchase agreements with its customers. Such warranties require the Company to repair or replace defective product returned to the Company during the warranty period at no cost to the customer. Warranties are not offered on sales of component products. The Company records an estimate for warranty related costs at the time of sale based on its historical and estimated future product return rates and expected repair or replacement costs (see Note 3). While such costs have historically been within management’s expectations and the provisions established, unexpected changes in failure rates could have a material adverse impact on the Company, requiring additional warranty reserves and could adversely affect the Company’s gross profit and gross margins. Stock-Based Compensation The Company accounts for equity issuances to non-employees in accordance with FASB ASC Topic 505. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date used to determine the estimated fair value of the equity instrument issued is the earlier of the date on which the third-party performance is complete or the date on which it is probable that performance will occur. In accordance with FASB ASC Topic 718, employee and director stock-based compensation expense recognized during the period is based on the value of the portion of stock-based payment awards that is ultimately expected to vest during the period. Given that stock-based compensation expense recognized in the accompanying consolidated statements of operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. The Company estimates its forfeitures at the time of grant and revises such estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company’s estimated average forfeiture rates are based on historical forfeiture experience and estimated future forfeitures. The estimated fair value of common stock option awards to employees and directors is calculated using the Black-Scholes option pricing model. The Black-Scholes model requires subjective assumptions regarding future stock price volatility and expected time to exercise, along with assumptions about the risk-free interest rate and expected dividends, all of which affect the estimated fair values of the Company’s common stock option awards. The expected term of options granted is calculated as the weighted-average of the vesting period and the contractual expiration date of the option. This calculation is in accordance with FASB ASC Topic 718, as amended by certain Securities and Exchange Commission guidance providing for a safe harbor method in instances where the vesting and exercise terms of options granted meet certain conditions and where limited historical exercise data is available. The expected volatility is based on the historical volatility of the Company’s common stock. The risk-free rate selected to value any particular grant is based on the U.S. Treasury rate that corresponds to the expected term of the grant effective as of the date of the grant. The expected dividend assumption is based on the Company’s history and management’s expectation regarding dividend payouts. Compensation expense for common stock option awards with graded vesting schedules is recognized on a straight-line basis over the requisite service period for the last separately vesting portion of the award, provided that the accumulated cost recognized as of any date at least equals the value of the vested portion of the award. If there are any modifications or cancellations of the underlying vested or unvested stock-based awards, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense, or record additional expense for vested stock-based awards. Future stock-based compensation expense and unearned stock- based compensation may increase to the extent that the Company grants additional stock options or other stock-based awards. Income Taxes Deferred tax assets and liabilities are recognized to reflect the estimated future tax effects, calculated at currently effective tax rates, of future deductible or taxable amounts attributable to events that have been recognized on a cumulative basis in the accompanying consolidated financial statements. A valuation allowance related to a net deferred tax asset is recorded when it is more likely than not that some portion of the deferred tax asset will not be realized. Deferred tax liabilities, deferred tax assets and valuation allowances are classified as non-current in the accompanying consolidated balance sheets. FASB ASC Topic 740 prescribes a recognition threshold and measurement requirement for the financial statement recognition of a tax position that has been taken or is expected to be taken on a tax return and also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Under FASB ASC Topic 740 the Company may only recognize or continue to recognize tax positions that meet a “more likely than not” threshold. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations may change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability for U.S. or foreign taxes may be materially different from the Company’s estimates, which could require the Company to record additional tax liabilities or to reduce previously recorded tax liabilities, as applicable. Contingent Legal Expenses Contingent legal fees are expensed in the consolidated statements of operations in the period that the related revenues are recognized. In instances where there are no recoveries from potential infringers, no contingent legal fees are paid; however, the Company may be liable for certain out of pocket legal costs incurred pursuant to the underlying legal services agreement. Research and Development Expenses Research and development expenditures are expensed in the period incurred. Interest Expense Interest expense consists primarily of interest associated with the Company’s debt instruments, including fees related to the term loans, accretion of debt discounts and amortization of debt issuance costs. The Company recognizes the accretion of debt discounts and the amortization of interest costs using the effective interest method. Foreign Currency Remeasurement The functional currency of the Company’s foreign subsidiaries is the U.S. dollar. Local currency financial statements are remeasured into U.S. dollars at the exchange rate in effect as of the balance sheet date for monetary assets and liabilities and the historical exchange rate for nonmonetary assets and liabilities. Expenses are remeasured using the average exchange rate for the period, except items related to nonmonetary assets and liabilities, which are remeasured using historical exchange rates. All remeasurement gains and losses are included in determining net loss. Transaction gains and losses were not significant in 2017 or 2016. Net Loss Per Share Basic net loss per share is calculated by dividing net loss by the weighted-average common shares outstanding during the period. Diluted net loss per share is calculated by dividing the net loss by the weighted-average shares and dilutive potential common shares outstanding during the period. Dilutive potential shares consist of dilutive shares issuable upon the exercise or vesting of outstanding stock options and warrants, respectively, computed using the treasury stock method and shares issuable upon conversion of the SVIC Note (see Note 5). In periods of losses, basic and diluted loss per share are the same, as the effect of stock options on loss per share is anti-dilutive. Business Risks and Uncertainties The Company’s results of operations, liquidity and financial condition are exposed to a number of risks and uncertainties. See the discussion in Item 1A. Risk Factors of the Annual Report on Form 10-K in which these consolidated financial statements are included (the “Annual Report”) for more information. Recently Adopted Accounting Standards In July 2015, the FASB issued Accounting Standards Update (“ASU”) No. 2015-11, Simplifying the Measurement of Inventory (“ASU 2015-11”), which requires entities to measure inventory at the lower of cost or net realizable value. Current guidance requires inventory to be measured at the lower of cost or market, with market defined as replacement cost, net realizable value, or net realizable value less a normal profit margin. This ASU simplifies the subsequent measurement of inventory by replacing the lower of cost or market test with a lower of cost or net realizable value test. The Company adopted this guidance in the first quarter of 2017 and there was no material impact on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), which is intended to simplify several aspects of the accounting for share-based payment transactions, including the accounting for income taxes, forfeitures, statutory tax withholding requirements, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods. The Company adopted this guidance in the first quarter of 2017 and elected to continue to estimate forfeitures expected to occur to determine the amount of compensation cost to be recognized in each period. As a result, there was no material impact on its consolidated financial statements. Recent Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which was subsequently amended by ASUs 2015-14, 2016-08, 2016-10, 2016-12, and 2016-20. ASU 2014-09, as amended, supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and creates a new FASB ASC Topic 606 (“ASC 606”). FASB ASC 606, implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. ASC 606 also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. ASC 606 is effective for public entities for annual periods beginning after December 15, 2017 (fiscal year 2018 for the Company), and interim periods within the year of adoption. The Company will adopt these updates beginning with the first quarter of its fiscal year 2018 using the modified retrospective transition approach in which the cumulative effect of initially applying ASC 606 will be recognized at the date of initial application, January 1, 2018. The Company has completed their analysis on the adoption of ASU 2014-09 and has determined the adoption will not have a material impact on the recognition of revenue. However, ASU 2014-09 requires enhanced disclosures about the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, which we fully expect to disclose in connection with our 10Q filing for the first quarter of 2018. We are in the process of implementing appropriate changes to our processes, systems and controls to support revenue recognition and the expanded qualitative and quantitative disclosures required under the new standard. In February 2016, the FASB issued ASU No. 2016-02 , Leases (“ASU 2016-02”). Under ASU 2016-02, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 (fiscal year 2019 for the Company), including interim periods within those fiscal years. Early application is permitted. Lessees must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees may not apply a full retrospective transition approach. The Company is currently evaluating the impact of adopting ASU 2016-02 on its consolidated financial statements and disclosures. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”), which is intended to reduce the existing diversity in practice in how certain cash receipts and cash payments are classified in the statement of cash flows. ASU 2016-15 is effective for fiscal years beginning after December 15, 2017 (fiscal year 2018 for the Company), including interim periods within those fiscal years with early adoption permitted, provided that all of the amendments are adopted in the same period. The Company is currently evaluating the impact of adopting ASU 2016-15 on its consolidated financial statements and disclosures. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory (“ASU 2016-16”), which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. This amends current U.S. GAAP which prohibits recognition of current and deferred income taxes for all types of intra-entity asset transfers until the asset has been sold to an outside party. ASU 2016-16 is effective for fiscal years beginning after December 15, 2017 (fiscal year 2018 for the Company), including interim periods therein with early application permitted. Upon adoption, the Company must apply a modified retrospective transition approach through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and disclosures, as well as its planned adoption date. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230), Restricted Cash (“ASU 2016-18”), which enhances and clarifies the guidance on the classification and presentation of restricted cash in the statement of cash flows. ASU 2016-18 is effective for fiscal periods beginning after December 15, 2018 (fiscal year 2019 for the Company), including interim periods therein with early appli

Supplemental Financial Informat

Supplemental Financial Information	12 Months Ended
	Dec. 30, 2017
Supplemental Financial Information
Supplemental Financial Information	Note 3—Supplemental Financial Information Inventories Inventories consisted of the following as of the dates presented: December 30, December 31, 2017 2016 (in thousands) Raw materials $ 768 $ 884 Work in process 88 47 Finished goods 3,249 2,229 $ 4,105 $ 3,160 Property and Equipment Property and equipment consisted of the following as of the dates presented: Estimated Useful December 30, December 31, Lives 2017 2016 (dollars in thousands) Machinery and equipment 3 - 7 yrs. $ 8,823 $ 8,941 Leasehold improvements * 878 878 Furniture and fixtures 5 yrs. 375 375 Computer equipment and software 3 - 7 yrs. 4,017 4,045 14,093 14,239 Less accumulated depreciation and amortization (13,634) (13,594) $ 459 $ 645 * Estimated useful life is generally seven years, or the remaining lease term, whichever is shorter. Warranty Liability The following table summarizes activity related to warranty liability in the periods presented: Year Ended December 30, December 31, 2017 2016 (in thousands) Beginning balance $ 89 $ 122 Estimated cost of warranty claims charged to cost of sales 221 49 Cost of actual warranty claims (158) (82) Ending balance 152 89 Less current portion (91) (53) Long-term warranty liability $ 61 $ 36 The allowance for warranty liability expected to be incurred within one year is included as a component of accrued expenses and other current liabilities in the accompanying consolidated balance sheets. The allowance for warranty liability expected to be incurred after one year is classified as long-term warranty liability in the accompanying consolidated balance sheets. Computation of Net Loss Per Share The following table sets forth the computation of basic and diluted net loss per share, including the numerator and denominator used in the calculation of basic and diluted net loss per share, for the periods presented: Year Ended December 30, December 31, 2017 2016 Basic and diluted net loss per share: Numerator: Net loss $ (13,420) $ (11,231) Denominator: Weighted-average common shares outstanding, basic and diluted 65,513 53,784 Basic and diluted net loss per share $ (0.20) $ (0.21) The table below sets forth potentially dilutive common share equivalents, consisting of shares issuable upon the exercise or vesting of outstanding stock options, and the exercise of warrants, computed using the treasury stock method, and shares issuable upon conversion of the SVIC Note (see Note 5) using the “if converted” method. These potential common shares have been excluded from the diluted net loss per share calculations above as their effect would be anti-dilutive for the periods presented: Year Ended December 30, December 31, 2017 2016 (in thousands) Common share equivalents 12,855 12,883 The above common share equivalents would have been included in the calculation of diluted net loss per share had the Company reported net income for the periods presented. Cash Flow Information The following table sets forth supplemental disclosures of cash flow information and non-cash financing activities for the periods presented: Year Ended December 30, December 31, 2017 2016 (in thousands) Supplemental disclosure of cash flow information: Cash paid during the year for: Interest $ 61 $ 131 Income taxes $ 4 $ - Supplemental disclosure of non-cash financing activities: Debt financing of insurance $ 220 $ 264 Acquisition of equipment through capital lease $ - $ 179

Credit Agreement

Credit Agreement	12 Months Ended
	Dec. 30, 2017
Credit Agreement
Credit Agreement	Note 4—Credit Agreements SVB Credit Agreement On October 31, 2009, the Company and Silicon Valley Bank (“SVB”) entered into a credit agreement (as amended, the “SVB Credit Agreement”). Pursuant to the terms of the SVB Credit Agreement, the Company is eligible to borrow, in a revolving line of credit, up to the lesser of (i) 80% of its eligible accounts receivable, or (ii) $5.0 million, subject to certain adjustments as set forth in the SVB Credit Agreement. The SVB Credit Agreement requires letters of credit to be secured by cash, which is classified as restricted cash in the accompanying consolidated balance sheets. As of December 30, 2017 and December 31, 2016, (i) letters of credit were outstanding in the amount of $2.8 million and $3.1 million, respectively, (ii) the Company had outstanding borrowings of $2.0 million and $0.7 million, respectively, and (iii) availability under the revolving line of credit was $0.1 million and $0.8 million, respectively. On January 29, 2016, the Company and SVB entered into an amendment to the SVB Credit Agreement to, among other things, adjust the rate at which advances under the SVB Credit Agreement accrue interest to the Wall Street Journal “prime rate” plus 2.75% (prior to such amendment, advances accrued interest at a rate equal to SVB’s most recently announced “prime rate” plus 2.75%). On March 27, 2017, the Company and SVB entered into another amendment to the SVB Credit Agreement to, among other things, (i) extend the maturity date of advances under the SVB Credit Agreement to April 1, 2018, (ii) modify the Company’s financial covenants under the SVB Credit Agreement to remove all prior financial standards and replace them with a liquidity ratio standard, (iii) remove or amend certain termination, anniversary and unused facility fees payable by the Company under the SVB Credit Agreement, and (iv) make certain other administrative changes. On April 12, 2017, the Company and SVB entered into a further amendment to the SVB Credit Agreement to, among other things, obtain SVB’s consent in connection with the Company’s rights agreement with Computershare Trust Company, N.A., as rights agent (see Note 8), and make certain administrative changes in connection with the Company’s funding arrangement with TR Global Funding V, LLC, an affiliate of TRGP Capital Management, LLC (“TRGP”) (see Note 7). On March 20, 2018, the Company and SVB entered into another amendment to the SVB Credit Agreement to among other things, (i) extend the maturity date of advances under the SVB Credit Agreement to March 31, 2019 and (ii) revise certain inventory reporting requirements under the SVB Credit Agreement. For all periods before April 20, 2017, all obligations under the SVB Credit Agreement were secured by a first priority security interest in the Company’s tangible and intangible assets, other than its patent portfolio, which was subject to a first priority security interest held by SVIC (see Note 5). Certain of these lien priorities were modified in April and May 2017 in connection with the Company’s establishment of a funding arrangement with TRGP for certain of the Company’s litigation expenses in connection with certain of its legal proceedings against SK Hynix Inc., a South Korean memory semiconductor supplier (“SK hynix”). On May 3, 2017, TRGP entered into an intercreditor agreement with each of SVIC and SVB, and on April 20, 2017 SVIC and SVB entered into an intercreditor agreement with each other (such intercreditor agreements, collectively, the “Intercreditor Agreements”). Pursuant to the terms of the Intercreditor Agreements, SVB’s security interests in the Company’s assets have been modified as follows: SVB has a first priority security interest in all of the Company’s tangible and intangible assets other than its patent portfolio and its claims underlying and any proceeds it may receive from the SK hynix proceedings; a second priority security interest in the Company’s patent portfolio other than the patents that are the subject of the SK hynix proceedings; and a third priority security interest in the Company’s patents that are the subject of the SK hynix proceedings. See Note 7 for more information about the funding arrangement with TRGP, the Intercreditor Agreements and the Company’s legal proceedings against SK hynix. The SVB Credit Agreement subjects the Company to certain affirmative and negative covenants, including financial covenants with respect to the Company’s liquidity and restrictions on the payment of dividends. As of December 30, 2017, the Company was in compliance with its covenants under the SVB Credit Agreement.

Debt

Debt	12 Months Ended
	Dec. 30, 2017
Debt
Debt	Note 5— Debt The Company’s debt consisted of the following as of the dates presented: December 30, December 31, 2017 2016 (in thousands) Convertible promissory note, SVIC, net of debt discount of $868 and $1,084 in 2017 and 2016, respectively $ 14,132 $ 13,916 Accrued interest on convertible promissory note with SVIC 634 335 Notes payable and capital lease obligation - 151 $ 14,766 $ 14,402 Less current portion - (151) $ 14,766 $ 14,251 On November 18, 2015, in connection with entering into the JDLA with Samsung, the Company sold to SVIC the SVIC Note and the SVIC Warrant. The SVIC Note has an original principal amount of $15.0 million, accrues interest at a rate of 2.0% per year, is due and payable in full on December 31, 2021, and is convertible into shares of the Company’s common stock at a conversion price of $1.25 per share, subject to certain adjustments, on the maturity date of the SVIC Note. Upon a change of control of the Company prior to the maturity date of the SVIC Note, the SVIC Note may, at the Company’s option, be assumed by the surviving entity or be redeemed upon the consummation of such change of control for the principal and accrued but unpaid interest as of the redemption date. The SVIC Warrant grants SVIC a right to purchase 2,000,000 shares of the Company’s common stock at an exercise price of $0.30 per share, subject to certain adjustments, is only exercisable in the event the Company exercises its right to redeem the SVIC Note prior to its maturity date, and expires on December 31, 2025. The SVIC Warrant was valued at $1,165,000, based on its relative fair value, and was recorded as a debt discount. The Company also recorded $154,000 of debt issuance costs as a debt discount for professional services fees rendered in connection with the transaction. These amounts are being amortized over the term of the SVIC Note using the effective interest method. For the fiscal years ended December 30, 2017 and December 31, 2016, the Company amortized $216,000 and $217,000 respectively, to interest expense in the accompanying consolidated statements of operations. In connection with the SVIC Note, SVIC was granted a first priority security interest in the Company’s patent portfolio and a second priority security interest in all of the Company’s other tangible and intangible assets. Upon issuance of the SVIC Note, the Company, SVB and SVIC entered into an Intercreditor Agreement pursuant to which SVB and SVIC agreed to their relative security interests in the Company’s assets. In May 2017, SVIC, SVB and TRGP entered into additional Intercreditor Agreements to modify certain of these lien priorities (see Note 7). Additionally, upon issuance of the SVIC Note and the SVIC Warrant, the Company and SVIC entered into a Registration Rights Agreement pursuant to which the Company is obligated to register with the SEC, upon demand by SVIC, the shares of the Company’s common stock issuable upon conversion of the SVIC Note or upon exercise of the SVIC Warrant. The SVIC Note subjects the Company to certain affirmative and negative operating covenants. As of December 30, 2017, the Company was in compliance with its covenants under the SVIC Note. Capital Lease and Notes Payable The Company had purchased computer equipment through a capital lease. As of December 30, 2017, the lease was repaid in full. As of December 30, 2017, maturities of debt, including amortization of debt discount and debt issuance costs, and accrued interest were as follows: Fiscal Year (in thousands) 2018 $ - 2019 - 2020 - 2021 15,634 Total payments on long-term debt 15,634 Less debt discount and debt issuance costs (868) Long-term debt $ 14,766 Interest expense, including amortization of debt discounts and debt issuance costs, net of interest income, was as follows during the periods presented: Year Ended December 30, December 31, 2017 2016 (in thousands) Interest expense: SVB $ 46 $ 48 SVIC 515 523 Others 20 23 581 594 Interest income (17) (16) $ 564 $ 578

Income Taxes

Income Taxes	12 Months Ended
	Dec. 30, 2017
Income Taxes
Income Taxes	Note 6—Income Taxes Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows: Year Ended December 30, December 31, 2017 2016 Deferred tax assets: (in thousands) Reserves and allowances $ $ State taxes, net of federal income tax benefit - Depreciation and amortization Other accruals Compensatory stock options and rights Basis difference in warrant value - Other Tax credit carryforwards Operating loss carryforward Foreign operating loss carryforward Total deferred tax assets 30,802 44,512 Deferred tax liabilities: Prepaid expenses (36) (76) Basis difference in warrant value - (73) Total deferred tax liabilities (36) (149) Subtotal 30,766 44,363 Valuation allowance (30,766) (44,363) $ - $ - The Company evaluates whether a valuation allowance should be established against its deferred tax assets based on the consideration of all available evidence using a “more likely than not” standard. In making such judgments, significant weight is given to evidence that can be objectively verified. As of December 30, 2017 and December 31, 2016, a valuation allowance of $30.8 million and $44.4 million, respectively, has been provided based on the Company’s assessment that it is more likely than not that sufficient taxable income will not be generated to realize the tax benefits of the temporary differences. The valuation allowance decreased by $13.6 million and increased by $4.7 million during the years ended December 30, 2017 and December 31, 2016, respectively. The decrease in the year ended December 30, 2017 primarily relates to the revaluing of the Company’s deferred tax assets due to the change in U.S. federal tax law discussed below, and the increase in the year ended December 31, 2016 primarily relates to the increase in the Company’s net operating loss carryforward. On December 27, 2017, new U.S. federal tax legislation was enacted that, among other things, lowers the corporate tax rate from 35% to 21%. In addition to applying the new lower corporate tax rate in 2018 and thereafter to any taxable income the Company may record, the legislation affects the way the Company can use and carry forward net operating losses previously accumulated, and has resulted in a revaluation of the Company’s deferred tax assets and liabilities recorded on the accompanying consolidated balance sheet. Because the Company’s existing deferred tax assets are currently offset by a full valuation allowance, these tax law changes have had no net impact on the accompanying consolidated balance sheet. However, if and when the Company becomes profitable, it would receive a reduced benefit from its deferred tax assets. As a result, the impact of the new tax law on the Company was a reduction in its deferred tax assets and corresponding valuation allowance of $14.7 million. As of December 30, 2017, the Company had (i) $104.0 million of federal net operating loss carryforwards, which begin to expire in 2024, (ii) $60.0 million of state net operating loss carryforwards, which begin to expire in 2018, ($2.0 million of the Company’s state net operating losses expired in the year ended December 30, 2017), (iii) federal tax credit carryforwards of $2.0 million, which begin to expire in 2026, and (iv) state tax credit carryforwards of $2.2 million, which do not expire. In addition, as of December 30, 2017, the Company had $3.3 million of operating loss carryforwards in the PRC and Taiwan, and during the year ended December 30, 2017, $0.5 million of the Company’s net operating loss carryforwards in the PRC and Taiwan expired in the year ended December 30, 2017. Utilization of the net operating losses and tax credit carryforwards is subject to an annual limitation due to the ownership percentage change limitations provided by Section 382 of the Internal Revenue Code and similar state and foreign law provisions. These annual limitations may result in the expiration of the net operating loss and tax credit carryforwards before utilization. As of December 30, 2017, the Company had not completed the determination of the amount subject to these annual limitations. As a result of the Company’s adoption of ASU 2016-09, the accounting for excess tax benefits to be recognized in additional paid-in capital and tax deficiencies recognized either in the income tax provision or in additional paid-in capital has been eliminated. The Company’s deferred tax assets as of December 30, 2017 did not include any excess tax benefits from employee stock option exercises, which are a component of the federal and state net operating loss carryforwards, and on a go-forward basis, any excess tax benefits will be recognized as a component of income tax expense. For financial reporting purposes, the Company’s loss before provision for income taxes included the following components for the periods presented: Year Ended December 30, December 31, 2017 2016 (in thousands) United States $ (12,871) $ (10,606) Foreign (543) (620) $ (13,414) $ (11,226) The Company’s income tax provision consisted of the following for the periods presented: Year Ended December 30, December 31, 2017 2016 (in thousands) Current: Federal $ - $ - State 6 5 Total current 6 5 Deferred: Federal 10,678 (3,349) State 2,577 (1,607) Foreign 342 288 Change in valuation allowance (13,597) 4,668 Total deferred - - Income tax provision $ 6 $ 5 A reconciliation of income taxes computed by applying the statutory U.S. income tax rate to the Company’s loss before income taxes to the income tax provision is as follows: Year Ended December 30, December 31, 2017 2016 U.S. federal statutory tax 34 % 34 % Valuation allowance (31) (29) Loss from foreign subsidiary (1) (2) Other (2) (3) Effective income tax provision rate - % - % The Company files tax returns with federal, state and foreign jurisdictions. The Company is no longer subject to Internal Revenue Service (“IRS”) or state examinations for periods prior to 2012, although certain carryforward attributes that were generated prior to 2012 may still be adjusted by the IRS. The Company classifies accrued interest and penalties as part of the accrued tax liability in its provision for income taxes. For the years ended December 30, 2017 and December 31, 2016, the Company did not recognize any interest or penalties related to unrecognized tax benefits. The Company’s recognizes interest and/or penalties related to income tax matters in income tax expense. As of December 30, 2017 and December 31, 2016, the Company had no accrued interest and penalties related to uncertain tax matters. As of December 30, 2017, the Company had no uncertain tax positions that would be reduced as a result of a lapse of the applicable statute of limitations.

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Dec. 30, 2017
Commitments and Contingencies
Commitments and Contingencies	Note 7—Commitments and Contingencies Leases The Company leases certain of its facilities and equipment under non‑cancelable operating leases that expire at various dates through 2019. Rental expense, net for the fiscal years ending December 30, 2017 and December 31, 2016 was $530,000 and $482,000, respectively. A summary of future minimum payments under operating lease commitments as of December 30, 2017 is as follows (in thousands): Operating Fiscal Year Leases 2018 $ 313 2019 92 Total minimum lease payments $ 405 Contingent Legal Expenses The Company may retain the services of law firms that specialize in patent licensing and enforcement and patent law in connection with its licensing and enforcement activities. These law firms may be retained on a contingent fee basis whereby such law firms are paid on a scaled percentage of any negotiated fee, settlements or judgments awarded based on how and when the fees, settlements or judgments are obtained. TRGP Agreement and Related Intercreditor Agreements On May 3, 2017, the Company and TRGP entered into an investment agreement (the “TRGP Agreement”), which generally provides that TRGP will directly fund the costs incurred by or on behalf of the Company in connection with certain of its legal proceedings against SK hynix (see “Litigation and Patent Reexaminations” in this Note 7 below), including costs incurred since January 1, 2017 and costs to be incurred in the future in the Company’s first action in the U.S. International Trade Commission (“ITC”) and its U.S. district court proceedings, but excluding the Company’s second ITC action and its proceedings in international courts (all such funded costs, collectively, the “Funded Costs”). In exchange for such funding, the Company has agreed that, if the Company recovers any proceeds in connection with the funded SK hynix proceedings, it will pay to TRGP the amount of the Funded Costs paid by TRGP plus an escalating premium based on when any such proceeds are recovered, such that the premium will equal a specified low-to-mid double-digit percentage of the amount of the Funded Costs and such percentage will increase by a specified low double-digit amount each quarter after a specified date until any such proceeds are recovered. In addition, pursuant to the terms of a separate security agreement between the Company and TRGP dated May 3, 2017 (the “Security Agreement”), the Company has granted to TRGP (i) a first priority lien on, and security in, the claims underlying the funded SK hynix proceedings and any proceeds that may be received by the Company in connection with these proceedings, and (ii) a second priority lien on, and security in, the Company’s patents that are the subject of the funded SK hynix proceedings. The TRGP Agreement does not impose financial covenants on the Company. Termination events under the TRGP Agreement include, among others, any failure by the Company to make payments to TRGP thereunder upon receipt of recoveries in the SK hynix proceedings; the occurrence of certain bankruptcy events; certain breaches by the Company of its covenants under the TRGP Agreement or the related Security Agreement; and the occurrence of a change of control of the Company. If any such termination event occurs, subject to certain cure periods for certain termination events, TRGP would have the right to terminate its obligations under the TRGP Agreement, including its obligation to make any further payments of Funded Costs after the termination date. In the event of any such termination by TRGP, the Company would continue to be obligated to pay TRGP the portion of any proceeds the Company may recover in connection with the SK hynix proceedings that TRGP would have been entitled to receive absent such termination, as described above, and TRGP may also be entitled to seek additional remedies pursuant to the dispute resolution provisions of the TRGP Agreement. In connection with the TRGP Agreement, in May 2017, TRGP, SVIC and SVB entered into the Intercreditor Agreements. Pursuant to the terms of the Intercreditor Agreements, TRGP, SVB and SVIC have agreed to their relative security interest priorities in the Company’s assets, such that: (i) TRGP has a first priority security interest in the Company’s claims underlying the funded SK hynix proceedings and any proceeds that may be received by the Company in connection with these proceedings, and a second priority security interest in the Company’s patents that are the subject of the funded SK hynix proceedings, (ii) SVIC has a first priority security interest in the Company’s complete patent portfolio and a second priority security interest in all of the Company’s other tangible and intangible assets (other than the Company’s claims underlying and any proceeds it may receive from the SK hynix proceedings funded under the TRGP Agreement), and (iii) SVB has a first priority security interest in all of the Company’s tangible and intangible assets other than its patent portfolio and its claims underlying and any proceeds it may receive from the SK hynix proceedings funded under the TRGP Agreement, a second priority security interest in the Company’s patent portfolio other than the patents that are the subject of the SK hynix proceedings funded under the TRGP Agreement, and a third priority security interest in the Company’s patents that are the subject of the SK hynix proceedings funded under the TRGP Agreement. The Company consented and agreed to the terms of each of the Intercreditor Agreements. Legal expenses incurred by the Company but paid by TRGP pursuant to the terms of the TRGP Agreement are excluded from the Company’s consolidated financial statements in each period in which the TRGP Agreement remains in effect. In the fiscal year ended December 30, 2017, the Company excluded legal expenses of $10.2 million as a result of TRGP’s payment of these expenses under the TRGP Agreement. Any settlement or other cash proceeds the Company may recover in the future in connection with the funded SK hynix proceedings would be reduced by the aggregate amount of legal expenses excluded by the Company as a result of TRGP’s payment of these expenses under the TRGP Agreement, plus the premium amount due to TRGP under the terms of the TRGP Agreement at the time of any such recovery. Litigation and Patent Reexaminations The Company owns numerous patents and continues to seek to grow and strengthen its patent portfolio, which covers various aspects of the Company’s innovations and includes various claim scopes. The Company plans to pursue avenues to monetize its intellectual property portfolio, in which it would generate revenue by selling or licensing its technology, and it intends to vigorously enforce its patent rights against alleged infringers of such rights. The Company dedicates substantial resources to protecting and enforcing its intellectual property rights, including with patent infringement proceedings it files against third parties and defense of its patents against challenges made by way of reexamination and review proceedings at the U.S. Patent and Trademark Office (“USPTO”) and Patent Trial and Appeal Board (“PTAB”). The Company expects these activities to continue for the foreseeable future, with no guarantee that any ongoing or future patent protection or litigation activities will be successful, or that the Company will be able to monetize its intellectual property portfolio. The Company is also subject to litigation based on claims that it has infringed on the intellectual property rights of others. Any litigation, regardless of its outcome, is inherently uncertain, involves a significant dedication of resources, including time and capital, and diverts management’s attention from our other activities. As a result, any current or future infringement claims or patent challenges by or against third parties, whether or not eventually decided in the Company’s favor or settled, could materially adversely affect the Company’s business, financial condition and results of operations. Additionally, the outcome of pending or future litigation and related patent reviews and reexaminations, as well as any delay in their resolution, could affect the Company’s ability to continue to sell its products, protect against competition in the current and expected markets for its products or license or otherwise monetize its intellectual property rights in the future. Google Litigation On December 4, 2009, the Company filed a patent infringement lawsuit against Google, Inc. (“Google”) in the U.S. District Court for the Northern District of California (the “Northern District Court”), seeking damages and injunctive relief based on Google’s alleged infringement of the Company’s U.S. Patent No. 7,619,912 (the “‘912 patent”), which relates generally to technologies to implement rank multiplication. In February 2010, Google answered the Company’s complaint and asserted counterclaims against the Company seeking a declaration that the patent is invalid and not infringed, and claiming that the Company committed fraud, negligent misrepresentation and breach of contract based on the Company’s activities in the Joint Electron Device Engineering Council (“JEDEC”) standard-setting organization. The counterclaim seeks unspecified compensatory damages. Accruals have not been recorded for loss contingencies related to Google’s counterclaim because it is not probable that a loss has been incurred and the amount of any such loss cannot be reasonably estimated. In October 2010, Google requested and was later granted an Inter Partes Reexamination of the ‘912 patent by the USPTO. The reexamination proceedings are described below. In connection with the reexamination request, the Northern District Court granted the Company’s and Google’s joint request to stay the ‘912 patent infringement lawsuit against Google until the completion of the reexamination proceedings. Inphi Litigation On September 22, 2009, the Company filed a patent infringement lawsuit against Inphi Corporation (“Inphi”) in the U.S. District Court for the Central District of California (the “Central District Court”). The complaint, as amended, alleges that Inphi is contributorily infringing and actively inducing the infringement of U.S. patents owned by the Company, including the ‘912 patent, U.S. Patent No. 7,532,537 (the “‘537 patent”), which relates generally to memory modules with load isolation and memory domain translation capabilities, and U.S. Patent No. 7,636,274 (the “‘274 patent”), which is related to the ‘537 patent and relates generally to load isolation and memory domain translation technologies. The Company is seeking damages and injunctive relief based on Inphi’s use of the Company’s patented technology. Inphi denied infringement and claimed that the three patents are invalid. In June 2010, Inphi requested and was later granted Inter Partes Reexaminations of the ‘912, ‘537 and ‘274 patents by the USPTO. The reexamination proceedings are described below (except for the reexamination proceeding related to the ‘537 patent, which have concluded with the confirmation of all of the claims of such patent). In connection with the reexamination requests, Inphi filed a motion to stay the patent infringement lawsuit with the Central District Court until completion of the reexamination proceedings, which was granted. ‘912 Patent Reexamination As noted above, in April 2010, June 2010 and October 2010, Google and Inphi submitted requests for an Inter Partes Reexamination of the ‘912 patent by the USPTO, claiming that the ‘912 patent is invalid and requesting that the USPTO reject the patent’s claims and cancel the patent. Additionally, in October 2010, Smart Modular, Inc. (“Smart Modular”) submitted another such reexamination request. On January 18, 2011, the USPTO granted such reexamination requests, and in February 2011, the USPTO merged the Inphi, Google and Smart Modular ‘912 patent reexaminations into a single proceeding. On March 21, 2014, the USPTO issued an Action Closing Prosecution (“ACP”), an office action that states the USPTO examiner’s position on patentability and closes further prosecution, and on June 18, 2014 the USPTO issued a Right of Appeal Notice (“RAN”), a notice that triggers the rights of the involved parties to file a notice of appeal to the ACP, each of which confirmed the patentability of 92 of the ‘912 patent’s claims and rejected the patent’s 11 other claims. The parties involved filed various notices of appeal, responses and requests, and on November 24, 2015, the PTAB held a hearing on such appeals. On May 31, 2016, the PTAB issued a decision affirming certain of the examiner’s decisions and reversing others. On February 9, 2017, the PTAB granted the Company’s request to reopen prosecution before the USPTO examiner and remanded the consolidated proceeding to the examiner to consider the patentability of certain of the pending claims in view of the PTAB’s May 31, 2016 decision and comments from the parties. On October 3, 2017, the examiner issued a determination as to the patentability of certain of the pending claims, which were found to be unpatentable. The proceeding will now return to the PTAB for reconsideration and issuance of a new decision. Accruals have not been recorded for loss contingencies related to the ‘912 patent reexamination proceedings because it is not probable that a loss has been incurred and the amount of any such loss cannot be reasonably estimated. ‘627 Patent Reexamination In September 2011, Smart Modular submitted a request for an Inter Partes Reexamination by the USPTO of the Company’s U.S. Patent No. 7,864,627 (the “‘627 patent”), related to the ‘912 patent, claiming that the ‘627 patent is invalid and requesting that the USPTO reject the patent’s claims and cancel the patent. On November 16, 2011, the request was granted. On March 27, 2014 and June 27, 2014, the USPTO issued an ACP and a RAN, respectively, each of which rejected all of the ‘627 patent’s claims. The parties involved filed various notices of appeal, responses and requests, and on November 24, 2015, the PTAB held a hearing on such appeals. On May 31, 2016, the PTAB issued a decision affirming the decisions of the examiner. On February 9, 2017, the PTAB granted the Company’s request to reopen prosecution before the USPTO examiner and remanded the proceeding to the examiner to consider the patentability of certain of the pending claims in view of the PTAB’s May 31, 2016 decision and comments from the parties. On October 2, 2017, the examiner issued a determination as to the patentability of the pending claims, which were found to be unpatentable. The proceeding will now return to the PTAB for reconsideration and issuance of a new decision. Accruals have not been recorded for loss contingencies related to the ‘627 patent reexamination proceedings because it is not probable that a loss has been incurred and the amount of any such loss cannot be reasonably estimated. ‘274 Patent Reexamination As noted above, in April 2010 and June 2010, Inphi submitted requests for an Inter Partes Reexamination of the ‘274 patent by the USPTO. On August 27, 2010, the request was granted. In March 2012 and June 2012, the USPTO issued an ACP and a RAN, respectively, each of which confirmed the patentability of many of the ‘274 patent’s claims. The parties involved filed various notices of appeal, responses and requests, and on November 20, 2013, the PTAB held a hearing on such appeals. On January 16, 2014, the PTAB issued a decision affirming the examiner in part, but reversing the examiner on new grounds and rejecting all of the patent’s claims. On September 11, 2015, the USPTO examiner issued a determination rejecting the amended claims. On January 23, 2017, the USPTO granted-in-part the Company’s petition to enter comments in support of its positions in the proceeding. On May 9, 2017, the PTAB issued a decision on appeal affirming the rejection of all claims. Netlist requested rehearing of the PTAB’s decision on June 6, 2017. The PTAB denied the rehearing request on August 8, 2017. On October 6, 2017, Netlist appealed the decision to the Court of Appeals for the Federal Circuit. Accruals have not been recorded for loss contingencies related to the ‘274 patent reexamination proceedings because it is not probable that a loss has been incurred and the amount of any such loss cannot be reasonably estimated. Smart Modular ‘295 Patent Litigation and Reexamination On September 13, 2012, Smart Modular, Inc. (“Smart Modular”) filed a patent infringement lawsuit against the Company in the U.S. District Court for the Eastern District of California (the “Eastern District Court”). The complaint alleges that the Company willfully infringes and actively induces the infringement of certain claims of U.S. Patent No. 8,250,295 (“the ‘295 patent”) issued to Smart Modular and seeks damages and injunctive relief. The Company answered Smart Modular’s complaint in October 2012, denying infringement of the ‘295 patent, asserting that the ‘295 patent is invalid and unenforceable, and asserting counterclaims against Smart Modular. Accruals have not been recorded for loss contingencies related to Smart Modular’s complaint because it is not probable that a loss has been incurred and the amount of any such loss cannot be reasonably estimated. On December 7, 2012, the USPTO granted the Company’s request for the reexamination of the ‘295 patent. On April 29, 2014, the USPTO examiner issued an ACP confirming some claims and rejecting others, and on August 4, 2015, the examiner issued a RAN confirming all pending claims. On September 4, 2015, the Company appealed to the PTAB. The parties involved filed various notices of appeal, responses and requests, and on September 22, 2016, the PTAB held a hearing on such appeals. On November 14, 2016, the PTAB issued a decision reversing the examiner and rejected all of the pending claims. On January 23, 2017, Smart Modular filed a request to reopen prosecution. The parties had the opportunity present evidence and arguments and the examiner issued a determination on May 8, 2017, which found all pending claims to be unpatentable. On December 12, 2017, the PTAB agreed with the examiner and found all pending claims to be unpatentable. Smart Modular appealed the PTAB’s decision to the Court of Appeals for the Federal Circuit. On March 28, 2018, the Eastern District Court stayed the proceedings related to the ‘295 patent. Smart Modular and SanDisk Litigation On July 1 and August 23, 2013, the Company filed complaints against Smart Modular, Smart Storage Systems (which was subsequently acquired by SanDisk Corporation (“SanDisk”)), Smart Worldwide Holdings (“Smart Worldwide”) and Diablo Technologies (“Diablo”) in the Central District Court, seeking, among other things, damages and other relief for alleged infringement of several of the Company’s patents by the defendants based on the manufacture and sale of the ULLtraDIMM memory module, alleged antitrust violations by Smart Modular and Smart Worldwide, and alleged trade secret misappropriation and trademark infringement by Diablo. The trade secret misappropriation and trademark infringement claims against Diablo were fully adjudicated on August 17, 2016 and are no longer pending. On August 23, 2013, Smart Modular and Diablo each filed a complaint in the San Francisco Division of the Northern District Court seeking declaratory judgment of non-infringement and invalidity of the patents asserted in the Company’s complaint. Based on various motions filed by the parties, on November 26, 2013, the Central District Court severed and transferred the patent claims related to the ULLtraDIMM memory module to the Northern District Court. On February 12, 2014, the Northern District Court granted the parties’ joint stipulation dismissing Smart Modular without prejudice. Between June 18, 2014 and August 23, 2014, SanDisk, Diablo, and Smart Modular filed numerous petitions in the USPTO requesting Inter Partes Review of the Company’s asserted patents. All of the reviews associated with U.S. Patent Nos. 8,516,187; 8,301,833; 8,516,185 have been resolved in the Company’s favor and are no longer pending. The reviews associated with U.S. Patent Nos. 8,001,434; 8,359,501; 7,881,150; and 8,081,536 have concluded before the PTAB and the parties have appealed the decisions in these reviews to the Court of Appeals for the Federal Circuit and are awaiting final decisions. On April 9, 2015, the Northern District Court stayed the infringement proceedings as to the Company’s patents asserted against the ULLtraDIMM pending resolution of the patent review decisions on appeal. SK Hynix Litigation On September 1, 2016, the Company filed legal proceedings for patent infringement against SK hynix in the ITC (the “First ITC Action”) and the Central District Court. These proceedings are based on the alleged infringement by SK hynix’s RDIMM and LRDIMM enterprise memory products of six of the Company’s U.S. patents. On October 31, 2017, the Company filed additional legal proceedings for patent infringement against SK hynix in the ITC (the “Second ITC Action”) based on the alleged infringement by SK hynix’s RDIMM and LRDIMM products of two additional U.S. patents owned by the Company. In all of the ITC proceedings, the Company has requested exclusion orders that direct U.S. Customs and Border Protection to stop allegedly infringing SK hynix RDIMM and LRDIMM products from entering the United States. In the Central District Court proceedings, the Company is primarily seeking damages. On October 3, 2016, the ITC instituted an investigation of the trade practices of SK hynix and certain of its subsidiaries in connection with the First ITC Action, and held a hearing on the merits of the investigation from May 8, 2017 until May 11, 2017. On November 14, 2017, the ITC issued a final initial determination for the First ITC Action, finding no infringement of the asserted patents and no violation of Section 337 of the Tariff Act, and on January 16, 2018, the ITC issued a final determination for the First ITC Action, affirming the findings of no infringement and no violation and terminating the investigation. The Company is considering its options for appeal. On January 11, 2018, the ITC set a 19-month target date of July 3, 2019 for an investigation related to the Second ITC Action, with a final initial determination for the Second ITC Action being filed no later than March 1, 2019. Based on this target date, the ITC scheduled a hearing on the merits of the investigation related to the Second ITC Action to begin on November 9, 2018 and conclude on November 19, 2018. Between December 30, 2016 and January 20, 2017, SK hynix filed numerous petitions in the USPTO requesting Inter Partes Review of certain of the Company’s patents, including the patents asserted in the First ITC Action and the Central District Court proceedings, the last of which is scheduled to conclude no later than July 2018. Between December 19, 2017 and February 7, 2018, SK hynix filed additional petitions in the USPTO requesting Inter Partes Review of the patents asserted in the Second ITC Action. The PTAB will determine whether to institute the requested reviews no later than August, 2018. On July 17, 2017, the Central District Court granted in part SK hynix’s request to stay the infringement proceedings pending further order of the court. On July 11, 2017, the Company filed legal proceedings for patent infringement against SK hynix and certain of its distributors in the courts of Germany and the PRC based on the alleged infringement by SK hynix’s LRDIMM products of certain of the Company’s patents in those jurisdictions. On January 25, 2018, the court in Germany held a preliminary hearing and set a trial date of December 6, 2018. The court in the PRC has not yet issued a schedule for the proceedings in that jurisdiction. In December 2017, SK hynix filed petitions challenging the validity of the patents asserted by the Company in Germany and the PRC. Morgan Joseph Litigation On March 31, 2016, Morgan Joseph Triartisan LLC (“Morgan Joseph”) filed a complaint in the Supreme Court of the State of New York against the Company and certain of its officers for breach of contract and related causes of action. The complaint alleged that the Company refused to honor its payment obligations under a written agreement with Morgan Joseph related to the provision of financial advisory and investment banking services. Morgan Joseph was seeking compensatory damages in the amount of $1,012,500, plus punitive damages in an amount not less than $1 million, together with pre-judgment interest, costs, and fees. On September 15, 2016, the Company filed a motion to dismiss Morgan Joseph’s complaint for failure to state a claim. On February 15, 2017, the court granted the Company’s motion to dismiss as to all causes of action brought by Morgan Joseph, and the matter is now closed. Other Contingent Obligations In the ordinary course of its business, the Company has made certain indemnities, commitments and guarantees pursuant to which it may be required to make payments in relation to certain transactions. These include, among others: (i) intellectual property indemnities to the Company’s customers and licensees in connection with the use, sale and/or license of Company products; (ii) indemnities to vendors and service providers pertaining to claims based on the Company’s negligence or willful misconduct; (iii) indemnities involving the accuracy of representations and warranties in certain contracts; (iv) indemnities to directors and officers of the Company to the maximum extent permitted under the laws of the State of Delaware; (v) indemnities to TRGP, SVIC and SVB pertaining to all obligations, demands, claims, and liabilities claimed or asserted by any other party in connection with transactions contemplated by the applicable investment or loan documents, as applicable; and (vi) indemnities or other claims related to certain real estate leases, under which the Company may be required to indemnify property owners for environmental and other liabilities or may face other claims arising from the Company’s use of the applicable premises. The duration of these indemnities, commitments and guarantees varies and, in certain cases, may be indefinite. The majority of these indemnities, commitments and guarantees do not provide for any limitation of the maximum potential for future payments the Company could be obligated to make. Historically, the Company has not been obligated to make significant payments as a result of these obligations, and no liabilities have been recorded for these indemnities, commitments and guarantees in the accompanying consolidated balance sheets.

Stockholders' Equity

Stockholders' Equity	12 Months Ended
	Dec. 30, 2017
Stockholders' Equity
Stockholders' Equity	Note 8—Stockholders’ Equity Serial Preferred Stock The Company’s authorized capital stock includes 10,000,000 shares of serial preferred stock, with a par value of $0.001 per share. No shares of preferred stock were outstanding at December 30, 2017 or December 31, 2016. On April 17, 2017, the Company entered into a rights agreement (the “Rights Agreement”) with Computershare Trust Company, N.A., as rights agent. In connection with the adoption of the Rights Agreement and pursuant to its terms, the Company’s board of directors authorized and declared a dividend of one right (each, a “Right”) for each outstanding share of the Company’s common stock to stockholders of record at the close of business on May 18, 2017 (the “Record Date”), and authorized the issuance of one Right for each share of the Company’s common stock issued by the Company (except as otherwise provided in the Rights Agreement) between the Record Date and the Distribution Date (as defined below). Each Right entitles the registered holder, subject to the terms of the Rights Agreement, to purchase from the Company, when exercisable and subject to adjustment, one unit consisting of one one-thousandth of a share (a “Unit”) of Series A Preferred Stock of the Company (the “Preferred Stock”), at a purchase price of $6.56 per Unit, subject to adjustment. Subject to the provisions of the Rights Agreement, including certain exceptions specified therein, a distribution date for the Rights (the “Distribution Date”) will occur upon the earlier of (i) 10 business days following a public announcement that a person or group of affiliated or associated persons (an “Acquiring Person”) has acquired or otherwise obtained beneficial ownership of 15% or more of the then‑outstanding shares of the Company’s common stock, and (ii) 10 business days (or such later date as may be determined by the Company’s board of directors) following the commencement of a tender offer or exchange offer that would result in a person or group becoming an Acquiring Person. The Rights are not exercisable until the Distribution Date and, unless earlier redeemed or exchanged by the Company pursuant to the terms of the Rights Agreement, will expire on the earlier of (i) the close of business on April 17, 2018, the first anniversary of the adoption of the Rights Agreement, and (ii) the date of any settlement, adjudication, dismissal with prejudice, abandonment by the Company or other conclusive and final resolution of the Company’s legal proceedings against SK hynix (see Note 7). In connection with the adoption of the Rights Agreement, the Company’s board of directors approved a Certificate of Designation of the Series A Preferred Stock (the “Certificate of Designation”) designating 1,000,000 shares of the Company’s serial preferred stock as Series A Preferred Stock and setting forth the rights, preferences and limitations of the Preferred Stock. The Company filed the Certificate of Designation with the Secretary of State of the State of Delaware on April 17, 2017. Common Stock On May 31, 2017, the Company’s stockholders approved an amendment to the Company’s Restated Certificate of Incorporation to increase the number of shares of the Company’s common stock that it is authorized for issuance from 90,000,000 to 150,000,000. On September 23, 2016, the Company completed an underwritten public offering (the “2016 Offering”), pursuant to which it sold 9,200,000 shares of its common stock at a price to the public of $1.25 per share. The net proceeds to the Company from the 2016 Offering were $10.3 million, after deducting underwriting discounts and commissions and offering expenses paid by the Company. On August 22, 2017, the Company completed an underwritten public offering (the “2017 Offering”), pursuant to which it sold 8,500,000 shares of its common stock at a price to the public of $0.60 per share. The net proceeds to the Company from the 2017 Offering were $4.4 million, after deducting underwriting discounts and commissions and offering expenses paid by the Company. On November 14, 2017, the Company entered into an At Market Issuance Sales Agreement (the “Sales Agreement”) with B. Riley FBR, Inc. (the “Agent”) to sell shares of the Company’s common stock, with aggregate gross proceeds of up to $9.0 million, from time to time, through an “at-the-market” equity offering program under which the Agent will act as sales agent (the “ATM Program”). Under the Sales Agreement, the Company will set the parameters for the sale of shares, including the number of shares to be issued, the time period during which sales are requested to be made, limitation on the number of shares that may be sold in any one trading day and any minimum price below which sales may not be made. The Sales Agreement provides that the Agent will be entitled to compensation for its services in an amount equal to 3% of the gross proceeds from the sale of shares sold under the Sales Agreement. The Company has no obligation to sell any shares under the Sales Agreement and may suspend solicitation and offers under the Sales Agreement. As of December 30, 2017, the Company sold 8,894,222 shares of its common stock in the ATM Program for net proceeds of $2.8 million, after deducting sales commissions and other offering expenses paid by the Company. In addition, subsequent to our fiscal year end through March 26, 2018 the Company sold 6,101,312 shares of its common stock for approximate net proceeds of $1.8 million, after deducting sales commissions and other offering expenses paid by the Company. Stock-Based Compensation The Company has stock-based compensation awards outstanding pursuant to its Amended and Restated 2006 Equity Incentive Plan, as re-approved by the Company’s stockholders on June 8, 2016 (the “Amended 2006 Plan”), under which a variety of stock-based awards, including stock options, may be granted to employees and non-employee service providers of the Company. In addition to awards granted pursuant to the Amended 2006 Plan, the Company periodically grants equity-based awards outside the Amended 2006 Plan to certain new hires as an inducement to enter into employment with the Company. Subject to certain adjustments, as of December 30, 2017, the Company was authorized to issue a maximum of 11,405,566 shares of its common stock pursuant to awards granted under the Amended 2006 Plan. Pursuant to the terms of the Amended 2006 Plan, the maximum number of shares of common stock subject to the plan automatically increased on the first day of each calendar year from January 1, 2007 through January 1, 2016, by the lesser of (i) 5.0% of the number of shares of common stock issued and outstanding as of the first day of the applicable calendar year, and (ii) 1,200,000 shares of common stock, subject to adjustment for certain corporate actions. Beginning January 1, 2017, the automatic annual increase to the number of shares of common stock that may be issued pursuant to awards granted under the Amended 2006 Plan is equal to the lesser of (i) 2.5% of the number of shares of common stock issued and outstanding as of the first day of the applicable calendar year, and (ii) 1,200,000 shares of common stock, subject to adjustment for certain corporate actions. As of December 30, 2017, the Company had 1,082,880 shares of common stock available for issuance pursuant to future awards to be granted under the Amended 2006 Plan. Stock options granted under the Amended 2006 Plan generally vest at a rate of at least 25% per year over four years and expire 10 years from the date of grant. The following table summarizes the Company’s stock option activity during the periods presented: Stock Options Outstanding Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Shares Exercise Life Value (in thousands) Price (in years) (in thousands) Options outstanding - January 2, 2016 8,944 $ 1.98 Options granted 1,530 1.10 Options exercised (293) 0.70 Options cancelled (1,383) 4.69 Options outstanding - December 31, 2016 8,798 1.46 Options granted 1,455 0.99 Options exercised (267) 0.68 Options cancelled (1,241) 1.77 Options outstanding - December 30, 2017 8,745 $ 1.39 $ 0.1 Options exercisable - December 30, 2017 6,185 $ 1.56 $ 0.1 Options exercisable and expected to vest - December 30, 2017 8,447 $ 1.40 $ 0.1 The following table summarizes information about stock options outstanding and exercisable at December 30, 2017: Stock Options Outstanding Stock Options Exercisable Weighted Weighted Average Average Remaining Weighted Remaining Weighted Number of Contractual Average Number of Contractual Average shares Life Exercise shares Life Exercise Exercise Price Range (in thousands) (in years) Price (in thousands) (in years) Price $0.20 - $1.00 3,914 6.6 $ 0.73 2,673 5.9 $ 0.73 $1.01 - $2.00 2,619 7.5 $ 1.33 1,324 6.3 $ 1.48 $2.01 - $3.00 1,507 3.4 $ 2.17 1,483 3.3 $ 2.17 $3.01 - $5.00 705 3.9 $ 3.60 705 3.9 $ 3.60 8,745 6.1 $ 1.39 6,185 5.2 $ 1.56 The following table presents the assumptions used to calculate the weighted-average grant date fair value of stock options granted by the Company in the periods presented: Year Ended December 30, December 31, 2017 2016 Expected term (in years) Expected volatility 87 % 113 % Risk-free interest rate % % Expected dividends $ - $ - Weighted-average grant date fair value per share $ 0.73 $ 0.89 Grant date fair value of options vested (in thousands) $ 1,206 $ 1,352 Intrinsic value of options exercised (in thousands) $ 89 $ 241 As of December 30, 2017, the amount of unearned stock-based compensation estimated to be expensed from 2018 through 2020 related to unvested stock options is approximately $1.3 million, net of estimated forfeitures. The weighted-average period over which the unearned stock-based compensation is expected to be recognized is approximately 2.2 years. If there are any modifications or cancellations of the underlying unvested awards, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense or calculate and record additional expense. Future stock-based compensation expense and unearned stock-based compensation expense will increase to the extent the Company grants additional stock options or other stock-based awards. Warrants In November 2015, concurrently with the issuance of the SVIC Note (see Note 5), the Company issued to SVIC the SVIC Warrant. The relative fair value of the SVIC Warrant was $1,165,000, which was recorded as a debt discount. In November 2015, in connection with the termination of the Company’s former loan agreement with Fortress Credit Opportunities I LLP (“Fortress”) and a monetization letter agreement with Drawbridge Special Opportunities Fund LP (“Drawbridge”), the Company issued to an affiliate of Fortress a new ten-year warrant to purchase up to 1,000,000 shares of the Company’s common stock at an exercise price of $0.47 per share (the “Fortress Warrant”) and amended the exercise price per share of a previously issued to seven-year warrant to purchase an aggregate of 1,648,351 shares of the Company’s common stock from $1.00 per share to $0.47 per share (the “Drawbridge Warrant”). The Fortress Warrant and the amended Drawbridge Warrant were valued using the Black-Scholes option pricing model, which computed an estimated fair value of $624,000 for the Fortress Warrant and an estimated incremental fair value of $129,000 for the amended Drawbridge Warrant. In November 2015, the Company issued warrants to purchase up to of 300,000 and 60,000 shares of the Company’s stock at an exercise price of $0.64 and $0.45 per share, respectively, to two different law firms as partial consideration for legal services rendered (each, a “Law Firm Warrant”). The Law Firm Warrants were valued at $185,000 and $49,000, respectively, based on their estimated fair values using the Black-Scholes option pricing model. On April 4, 2016, the Drawbridge Warrant was exercised in part on a cashless basis, pursuant to which 1,000,000 shares subject to the warrant were exercised in exchange for the Company’s issuance of an aggregate of 674,300 shares of its common stock. On August 29, 2016, the portion of the Drawbridge Warrant that remained outstanding was exercised in part on a cashless basis, pursuant to which the remaining 648,351 shares subject to the warrant were exercised in exchange for the Company’s issuance of an aggregate of 465,555 shares of its common stock. On November 22, 2016, the Fortress Warrant was exercised in full on a cashless basis, pursuant to which all 1,000,000 shares subject to the warrant were exercised in exchange for the Company’s issuance of an aggregate of 605,599 shares of its common stock. On December 22, 2016, one of the Law Firm Warrants, to purchase up to 60,000 shares of the Company’s common stock, was exercised in full on a cash basis, pursuant to which the Company received gross proceeds of $27,000. The following table summarizes the Company’s warrant activity during the periods presented: Weighted Number of Average Shares Exercise (in thousands) Price Warrants outstanding - January 2, 2016 7,633 $ 0.59 Warrant granted - - Warrants exercised (2,709) 0.47 Warrants outstanding - December 31, 2016 4,924 $ 0.66 Warrant granted - - Warrants exercised - - Warrants outstanding - December 30, 2017 4,924 $ 0.66

401(k) Plan

401(k) Plan	12 Months Ended
	Dec. 30, 2017
401(k) Plan
401(k) Plan	Note 9—401(k) Plan The Company sponsors a 401(k) defined contribution retirement savings plan. Employees are eligible to participate in this plan if they are employed full-time and have reached 21 years of age. Participants may make pre-tax contributions to the plan subject to a statutorily prescribed annual limit. Each participant is fully vested in his or her contributions and investment earnings. The Company may make matching contributions on the contributions of a participant on a discretionary basis. The Company adopted a limited matching contribution policy in 2012 and, pursuant to this policy, made $100,000 and $123,000 in matching contributions to participants in this plan in the years ended December 30, 2017 and December 31, 2016, respectively.

Major Customers, Suppliers and

Major Customers, Suppliers and Products	12 Months Ended
	Dec. 30, 2017
Major Customers, Suppliers and Products
Major Customers, Suppliers and Products	Note 10—Major Customers, Suppliers and Products The Company’s product sales have historically been concentrated in a small number of customers. The following table sets forth the percentage of the Company’s net product revenues made to customers that each comprise 10% or more of the Company’s net product revenues in the periods presented: Year Ended December 30, December 31, 2017 2016 Customer A * % % * less than 10% of total net product sales The Company’s accounts receivable are concentrated with three customers at December 30, 2017, representing approximately 15%, 13% and 12% of aggregate gross receivables, respectively. At December 31, 2016, two customers represented approximately 27% and 11% of aggregate gross receivables, respectively. The loss of any of the Company’s significant customers or a reduction in sales to or difficulties collecting payments from any of these customers could significantly reduce the Company’s net product revenues and adversely affect its operating results. The Company tries to mitigate risks associated with foreign receivables by purchasing comprehensive foreign credit insurance. The Company resells certain component products to end-customers that are not reached in the distribution models of the component manufacturers, including storage customers, appliance customers, system builders and cloud and datacenter customers. Historically, the Company has obtained the majority of the component products it resells from Samsung. In the years ended December 30, 2017 and December 31, 2016, resales of these products represented approximately 85% and 66%, respectively, of the Company’s net product revenues. The Company’s purchases are typically concentrated in a small number of suppliers. The following table sets forth the percentage of the Company’s purchases made from suppliers that each comprise 10% or more of the Company’s total purchases in the periods presented: Year Ended December 30, December 31, 2017 2016 Supplier A % % Supplier B % * * Less than 10% of purchases during the period While the Company believes alternative suppliers may be available, its dependence on a small number of suppliers and the lack of any guaranteed sources for the essential components of its products and the components it resells exposes the Company to several risks, including the inability to obtain an adequate supply of these components, increases in their costs, delivery delays and poor quality. If the Company is not able to obtain these components in the amounts needed on a timely basis and at commercially reasonable prices, it may not be able to develop or introduce new products, it may experience significant increases in its cost of sales if it is forced to procure components from alternative suppliers and is not able to negotiate favorable terms with these suppliers, it may experience interruptions or failures in the delivery of its products, or it may be forced to cease sales of products dependent on the components or resales of the components it resells to customers directly. The occurrence of any of these risks could have a material adverse effect on the Company.

Segment and Geographic Informat

Segment and Geographic Information	12 Months Ended
	Dec. 30, 2017
Segment and Geographic Information
Segment and Geographic Information	Note 11—Segment and Geographic Information The Company operates in one reportable segment, which is the design, manufacture and sale of high-performance memory subsystems for the server, high-performance computing and communications markets and component products purchased for the purpose of resale. The Company evaluates financial performance on a Company-wide basis. To date, a majority of the Company’s international sales relate to shipments of products to its U.S. customers’ international manufacturing sites or third‑party hubs. Net product revenues derived from shipments to international destinations, primarily to Hong Kong (including foreign subsidiaries of customers that are headquartered in the United States), represented approximately 67% and 26% of the Company’s net product revenues in 2017 and 2016, respectively. All of the Company’s net product revenues to date have been denominated in U.S. dollars. As of December 30, 2017 and December 31, 2016, approximately $0.07 million and $0.06 million, respectively, of the Company’s long-lived assets, net of depreciation and amortization, were located outside the United States, primarily in the PRC. Substantially all other long-lived assets were located in the United States.

Subsequent Events

Subsequent Events	12 Months Ended
	Dec. 30, 2017
Subsequent Events
Subsequent Events	Note 12—Subsequent Events The Company has evaluated subsequent events through the filing date of this Annual Report on Form 10-K and determined that no subsequent events have occurred that would require recognition in the consolidated financial statements or disclosures in the notes thereto other than as discussed in the accompanying notes.

Quarterly Summary (Unaudited)

Quarterly Summary (Unaudited)	12 Months Ended
	Dec. 30, 2017
Quarterly Summary (Unaudited)
Quarterly Summary (Unaudited)	Note 13—Quarterly Summary (Unaudited) The following tables set forth the Company’s quarterly consolidated statements of operations data for the eight quarters ended December 30, 2017. In the opinion of management, this quarterly data has been prepared on the same basis as the accompanying audited consolidated financial statements. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of the Annual Report for descriptions of the effects of any extraordinary, unusual or infrequently occurring items recognized in any of the periods covered by this quarterly data. The results of operations for any one quarter are not indicative of the results to be expected in the current period or any future period. Each of the Company’s quarters in its 2017 and 2016 fiscal year was comprised of 13 weeks. Quarterly computations of per share amounts are made independently and, as a result, the sum of per share amounts for the four quarters in any one fiscal year may not add to the per share amount for such fiscal year. Three Months Ended December 30, September 30, July 1, April 1, 2017 2017 2017 2017 (in thousands, except per share data) Net product revenues $ 8,482 $ 9,010 $ 11,404 $ 9,426 Cost of sales 8,075 8,285 10,760 8,746 Gross profit 407 725 644 680 Operating expenses: Research and development 1,089 1,159 1,487 1,496 Intellectual property legal fees 575 749 915 466 Selling, general and administrative 1,729 1,780 1,951 1,914 Total operating expenses 3,393 3,688 4,353 3,876 Operating loss (2,986) (2,963) (3,709) (3,196) Other expense, net: Interest expense, net (143) (135) (138) (148) Other income, net 2 - - 2 Total other expense, net (141) (135) (138) (146) Loss before provision for income taxes (3,127) (3,098) (3,847) (3,342) Provision for income taxes 6 - - - Net loss $ (3,133) $ (3,098) $ (3,847) $ (3,342) Net loss per common share: Basic and diluted $ (0.04) $ (0.05) $ (0.06) $ (0.05) Weighted-average common shares outstanding: Basic and diluted 72,882 65,644 61,844 61,681 Three Months Ended December 31, October 1, July 2, April 2, 2016 2016 2016 2016 (in thousands, except per share data) Net product revenues $ 5,538 $ 2,589 $ 3,500 $ 1,171 NRE revenue - - 3,428 3,429 Total net revenues 5,538 2,589 6,928 4,600 Cost of sales 5,263 2,580 3,267 1,149 Gross profit 275 9 3,661 3,451 Operating expenses: Research and development 1,347 1,463 1,831 1,646 Intellectual property legal fees 855 409 1,023 823 Selling, general and administrative 2,211 2,398 2,159 2,265 Total operating expenses 4,413 4,270 5,013 4,734 Operating loss (4,138) (4,261) (1,352) (1,283) Other income (expense), net: Interest expense, net (150) (159) (132) (137) Other income (expense), net 369 19 (10) 8 Total other income (expense), net 219 (140) (142) (129) Loss before provision for income taxes (3,919) (4,401) (1,494) (1,412) Provision for income taxes 4 - - 1 Net loss $ (3,923) $ (4,401) $ (1,494) $ (1,413) Net loss per common share: Basic and diluted $ (0.06) $ (0.08) $ (0.03) $ (0.03) Weighted-average common shares outstanding: Basic and diluted 61,233 52,454 51,080 50,365

Summary of Significant Accoun21

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 30, 2017
Summary of Significant Accounting Policies
Basis of Presentation	Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Principles of Consolidation	Principles of Consolidation The consolidated financial statements include the accounts of Netlist, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Fiscal Year	Fiscal Year The Company operates under a 52 or 53 week fiscal year ending on the Saturday closest to December 31. The 2017 and 2016 fiscal years ended on December 30, 2017 and December 31, 2016, respectively, and consisted of 52 weeks.
Use of Estimates	Use of Estimates The preparation of the accompanying consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of net revenues and expenses during the reporting period. By their nature, these estimates and assumptions are subject to an inherent degree of uncertainty. The Company bases its estimates and assumptions on its historical experience, knowledge of current conditions and the Company’s belief of what could occur in the future considering available information. The Company reviews its estimates and assumptions on an ongoing basis. Actual results may differ materially from these estimates, which may result in material adverse effects on the Company’s consolidated operating results and financial position. The Company believes the following critical accounting policies involve its more significant assumptions and estimates used in the preparation of the accompanying consolidated financial statements: provisions for uncollectible receivables and sales returns; warranty liability; valuation of inventories; fair value of financial instruments; recoverability of long-lived assets; valuation of stock-based transactions; estimates for completion of NRE and other revenue milestones and the realization of deferred tax assets. The Company bases its estimates on historical experience, knowledge of current conditions and the Company’s belief of what could occur in the future considering available information. The Company reviews its estimates on an ongoing basis. Actual results may differ materially from these estimates which may result in material adverse effects on the Company’s operating results and financial position.
Revenue Recognition	Revenue Recognition The Company generates revenue from sales of products and performance of engineering services. Net Product Revenues Net product revenues consist primarily of resales of NAND flash, DRAM products and other component products to end-customers that are not reached in the distribution models of the component manufacturers, including storage customers, appliance customers, system builders and cloud and datacenter customers, as well as sales of high-performance modular memory subsystems primarily to original equipment manufacturers (“OEMs”) in the server, high-performance computing and communications markets. The Company recognizes revenues in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 605. Accordingly, the Company recognizes revenues when there is persuasive evidence that an arrangement exists, product delivery and acceptance have occurred, the sales price is fixed or determinable, and collectability of the resulting receivable is reasonably assured. The Company generally uses customer purchase orders and/or contracts as evidence of an arrangement. Delivery occurs when goods are shipped for customers with shipping point terms and upon receipt for customers with destination terms, at which time title and risk of loss transfer to the customer. Shipping documents are used to verify delivery and customer acceptance. The Company assesses whether the sales price is fixed or determinable based on the payment terms associated with the transaction and whether the sales price is subject to refund. Customers are generally allowed limited rights of return for up to 30 days, except for sales of excess component inventories, which contain no right-of-return privileges. Estimated returns are provided for at the time of sale based on historical experience or specific identification of an event necessitating a reserve. The Company offers a standard product warranty to customers of its memory subsystem products and has no other post-shipment obligations. The Company assesses collectability based on the creditworthiness of the customer as determined by credit checks and evaluations, as well as the customer’s payment history. All amounts billed to customers related to shipping and handling are classified as net product revenues, while all costs incurred by the Company for shipping and handling are classified as cost of sales. Engineering Services From time-to-time, the Company provides engineering services to its customers. The Company recognizes revenue from these services when all of the following conditions are met: (1) evidence existed of an arrangement with the customer, typically consisting of a purchase order or contract; (2) the Company’s services were performed and risk of loss passed to the customer; (3) the Company completed all of the necessary terms of the contract; (4) the amount of revenue to which the Company was entitled was fixed or determinable; and (5) the Company believed it was probable that it would be able to collect the amount due from the customer. To the extent one or more of these conditions has not been satisfied, the Company defers recognition of revenue.
Deferred Revenue	Deferred Revenue From time-to-time, the Company receives pre-payments from its customers related to future services. Engineering development fee revenues, including NRE fees, are deferred and recognized ratably over the period the engineering work is completed.
Cash and Cash Equivalents	Cash and Cash Equivalents Cash and cash equivalents consist of cash and short-term investments with original maturities of three months or less.
Restricted Cash	Restricted Cash Restricted cash consists of cash to secure standby letters of credit. Restricted cash was $2.8 million as of December 30, 2017 and related to three standby letters of credit, and restricted cash was $3.1 million as of December 31, 2016 and related to two standby letters of credit.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company follows ASC Topic 820 to account for the fair value of certain assets and liabilities. ASC Topic 820 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. ASC Topic 820 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC Topic 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. An active market is defined as a market in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company’s financial instruments consist principally of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, accrued expenses, revolving line of credit and convertible promissory note. The Company considers the carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses to approximate the fair value for these financial instruments based upon an evaluation of the underlying characteristics, market data and because of the short period of time between origination of the instruments and their expected realization. The fair value of the Company’s revolving line of credit and convertible promissory note is determined using current applicable rates for similar instruments as of the balance sheet date and an assessment of the credit rating of the Company. The carrying value of the Company’s revolving line of credit at December 30, 2017 approximates fair value because the Company’s interest rate yield is near current market rates for comparable debt instruments. The fair value of the Company’s convertible promissory note was estimated using a discounted cash flow analysis using borrowing rates available to the Company for debt instruments with similar terms and maturities. The Company has determined that the valuation of its convertible promissory note is classified in Level 2 of the fair value hierarchy. The carrying value and estimated fair value of the convertible promissory note as of December 30, 2017 were $14.1 million and $12.3 million, respectively. The carrying value and estimated fair value of the convertible promissory note as of December 31, 2016 were $13.9 million and $12.2 million, respectively.
Allowance for Doubtful Accounts	Allowance for Doubtful Accounts The Company performs credit evaluations of its customers’ financial condition and limits the amount of credit extended to its customers as deemed necessary, but generally requires no collateral. The Company evaluates the collectability of accounts receivable based on a combination of factors. In cases where the Company is aware of circumstances that may impair a specific customer’s ability to meet its financial obligations subsequent to the original sale, the Company will record an allowance against amounts due, and thereby reduce the net recognized receivable to the amount the Company reasonably believes will be collected. For all other customers, the Company records allowances for doubtful accounts based primarily on the length of time the receivables are past due based on the terms of the originating transaction, the current business environment, and its historical experience. Uncollectible accounts are charged against the allowance for doubtful accounts when all cost-effective commercial means of collection have been exhausted. Generally, the Company’s credit losses have been within expectations and the provisions established. However, the Company cannot guarantee that it will continue to experience credit loss rates similar to those experienced in the past. The Company’s accounts receivable are generally highly concentrated among a small number of customers, and a significant change in the liquidity or financial position of one of these customers could have a material adverse effect on the collectability of the Company’s accounts receivable, liquidity and future operating results.
Concentration of Credit Risk	Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents, and accounts receivable. The Company invests its cash equivalents primarily in money market mutual funds. Cash equivalents are maintained with high quality institutions, the composition and maturities of which are regularly monitored by management. At times, deposits held with financial institutions may exceed the amount of insurance provided by the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation. The Company’s trade accounts receivable are primarily derived from sales to OEMs in the server, high-performance computing and communications markets, as well as from sales to storage customers, appliance customers, system builders and cloud and datacenter customers. The Company performs credit evaluations of its customers’ financial condition and limits the amount of credit extended when deemed necessary, but generally requires no collateral. The Company believes the concentration of credit risk in its trade receivables is moderated by its credit evaluation process, relatively short collection terms, a high level of credit worthiness of its customers (see Note 10), foreign credit insurance, and letters of credit issued in its favor. Reserves are maintained for potential credit losses, and such losses historically have not been significant and have been within management’s expectations.
Inventories	Inventories Inventories are valued at the lower of actual cost to purchase or manufacture the inventory or the net realizable value of the inventory. Cost is determined on an average cost basis which approximates actual cost on a first-in, first-out basis and includes raw materials, labor and manufacturing overhead.
Property and Equipment	Property and Equipment Property and equipment are recorded at cost and depreciated on a straight-line basis over their estimated useful lives, which generally range from three to seven years. Leasehold improvements are recorded at cost and amortized on a straight-line basis over the shorter of their estimated useful lives or the remaining lease term. Expenditures for repairs and maintenance are expensed as incurred. Upon retirement or sale, the cost and related accumulated depreciation and amortization of disposed assets are removed from the accounts and any resulting gain or loss is included in other income, net.
Debt Issuance Costs, Debt Discount and Detachable Debt-Related Warrants	Debt Issuance Costs, Debt Discount and Detachable Debt-Related Warrants Costs incurred to issue debt are deferred and recorded as a reduction to the debt balance in the accompanying consolidated balance sheets. The Company amortizes debt issuance costs over the expected term of the related debt using the effective interest method. Debt discounts relate to the relative fair value of warrants issued in conjunction with the debt and are also recorded as a reduction to the debt balance and accreted over the expected term of the debt to interest expense using the effective interest method.
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets The Company evaluates the recoverability of the carrying value of long-lived assets held and used by the Company in its operations for impairment on at least an annual basis or whenever events or changes in circumstances indicate that their carrying value may not be recoverable. When such factors and circumstances exist, the Company compares the projected undiscounted future net cash flows associated with the related asset or group of assets over their estimated useful lives against their respective carrying amount. These projected future cash flows may vary significantly over time as a result of increased competition, changes in technology, fluctuations in demand, consolidation of the Company’s customers and reductions in average sales prices. If the carrying value is determined not to be recoverable from future operating cash flows, the asset is deemed impaired and an impairment loss is recognized to the extent the carrying value exceeds the estimated fair value of the asset. The fair value of the asset or asset group is based on market value when available, or when unavailable, on discounted expected cash flows. The Company’s management believes there is no impairment of long-lived assets as of December 30, 2017. However, market conditions could change or demand for products the Company sells could decrease, which could result in future impairment of long-lived assets.
Warranty Liability	Warranty Liability The Company offers product warranties generally ranging from one to three years, depending on the product and negotiated terms of any purchase agreements with its customers. Such warranties require the Company to repair or replace defective product returned to the Company during the warranty period at no cost to the customer. Warranties are not offered on sales of component products. The Company records an estimate for warranty related costs at the time of sale based on its historical and estimated future product return rates and expected repair or replacement costs (see Note 3). While such costs have historically been within management’s expectations and the provisions established, unexpected changes in failure rates could have a material adverse impact on the Company, requiring additional warranty reserves and could adversely affect the Company’s gross profit and gross margins.
Stock-Based Compensation	Stock-Based Compensation The Company accounts for equity issuances to non-employees in accordance with FASB ASC Topic 505. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date used to determine the estimated fair value of the equity instrument issued is the earlier of the date on which the third-party performance is complete or the date on which it is probable that performance will occur. In accordance with FASB ASC Topic 718, employee and director stock-based compensation expense recognized during the period is based on the value of the portion of stock-based payment awards that is ultimately expected to vest during the period. Given that stock-based compensation expense recognized in the accompanying consolidated statements of operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. The Company estimates its forfeitures at the time of grant and revises such estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company’s estimated average forfeiture rates are based on historical forfeiture experience and estimated future forfeitures. The estimated fair value of common stock option awards to employees and directors is calculated using the Black-Scholes option pricing model. The Black-Scholes model requires subjective assumptions regarding future stock price volatility and expected time to exercise, along with assumptions about the risk-free interest rate and expected dividends, all of which affect the estimated fair values of the Company’s common stock option awards. The expected term of options granted is calculated as the weighted-average of the vesting period and the contractual expiration date of the option. This calculation is in accordance with FASB ASC Topic 718, as amended by certain Securities and Exchange Commission guidance providing for a safe harbor method in instances where the vesting and exercise terms of options granted meet certain conditions and where limited historical exercise data is available. The expected volatility is based on the historical volatility of the Company’s common stock. The risk-free rate selected to value any particular grant is based on the U.S. Treasury rate that corresponds to the expected term of the grant effective as of the date of the grant. The expected dividend assumption is based on the Company’s history and management’s expectation regarding dividend payouts. Compensation expense for common stock option awards with graded vesting schedules is recognized on a straight-line basis over the requisite service period for the last separately vesting portion of the award, provided that the accumulated cost recognized as of any date at least equals the value of the vested portion of the award. If there are any modifications or cancellations of the underlying vested or unvested stock-based awards, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense, or record additional expense for vested stock-based awards. Future stock-based compensation expense and unearned stock- based compensation may increase to the extent that the Company grants additional stock options or other stock-based awards.
Income Taxes	Income Taxes Deferred tax assets and liabilities are recognized to reflect the estimated future tax effects, calculated at currently effective tax rates, of future deductible or taxable amounts attributable to events that have been recognized on a cumulative basis in the accompanying consolidated financial statements. A valuation allowance related to a net deferred tax asset is recorded when it is more likely than not that some portion of the deferred tax asset will not be realized. Deferred tax liabilities, deferred tax assets and valuation allowances are classified as non-current in the accompanying consolidated balance sheets. FASB ASC Topic 740 prescribes a recognition threshold and measurement requirement for the financial statement recognition of a tax position that has been taken or is expected to be taken on a tax return and also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Under FASB ASC Topic 740 the Company may only recognize or continue to recognize tax positions that meet a “more likely than not” threshold. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations may change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability for U.S. or foreign taxes may be materially different from the Company’s estimates, which could require the Company to record additional tax liabilities or to reduce previously recorded tax liabilities, as applicable.
Contingent Legal Expenses	Contingent Legal Expenses Contingent legal fees are expensed in the consolidated statements of operations in the period that the related revenues are recognized. In instances where there are no recoveries from potential infringers, no contingent legal fees are paid; however, the Company may be liable for certain out of pocket legal costs incurred pursuant to the underlying legal services agreement.
Research and Development Expenses	Research and Development Expenses Research and development expenditures are expensed in the period incurred.
Interest Expense	Interest Expense Interest expense consists primarily of interest associated with the Company’s debt instruments, including fees related to the term loans, accretion of debt discounts and amortization of debt issuance costs. The Company recognizes the accretion of debt discounts and the amortization of interest costs using the effective interest method.
Foreign Currency Remeasurement	Foreign Currency Remeasurement The functional currency of the Company’s foreign subsidiaries is the U.S. dollar. Local currency financial statements are remeasured into U.S. dollars at the exchange rate in effect as of the balance sheet date for monetary assets and liabilities and the historical exchange rate for nonmonetary assets and liabilities. Expenses are remeasured using the average exchange rate for the period, except items related to nonmonetary assets and liabilities, which are remeasured using historical exchange rates. All remeasurement gains and losses are included in determining net loss. Transaction gains and losses were not significant in 2017 or 2016.
Net Loss Per Share	Net Loss Per Share Basic net loss per share is calculated by dividing net loss by the weighted-average common shares outstanding during the period. Diluted net loss per share is calculated by dividing the net loss by the weighted-average shares and dilutive potential common shares outstanding during the period. Dilutive potential shares consist of dilutive shares issuable upon the exercise or vesting of outstanding stock options and warrants, respectively, computed using the treasury stock method and shares issuable upon conversion of the SVIC Note (see Note 5). In periods of losses, basic and diluted loss per share are the same, as the effect of stock options on loss per share is anti-dilutive.
Business Risks and Uncertainties	Business Risks and Uncertainties The Company’s results of operations, liquidity and financial condition are exposed to a number of risks and uncertainties. See the discussion in Item 1A. Risk Factors of the Annual Report on Form 10-K in which these consolidated financial statements are included (the “Annual Report”) for more information.
Recently Adopted Accounting Standards	Recently Adopted Accounting Standards In July 2015, the FASB issued Accounting Standards Update (“ASU”) No. 2015-11, Simplifying the Measurement of Inventory (“ASU 2015-11”), which requires entities to measure inventory at the lower of cost or net realizable value. Current guidance requires inventory to be measured at the lower of cost or market, with market defined as replacement cost, net realizable value, or net realizable value less a normal profit margin. This ASU simplifies the subsequent measurement of inventory by replacing the lower of cost or market test with a lower of cost or net realizable value test. The Company adopted this guidance in the first quarter of 2017 and there was no material impact on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), which is intended to simplify several aspects of the accounting for share-based payment transactions, including the accounting for income taxes, forfeitures, statutory tax withholding requirements, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods. The Company adopted this guidance in the first quarter of 2017 and elected to continue to estimate forfeitures expected to occur to determine the amount of compensation cost to be recognized in each period. As a result, there was no material impact on its consolidated financial statements.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which was subsequently amended by ASUs 2015-14, 2016-08, 2016-10, 2016-12, and 2016-20. ASU 2014-09, as amended, supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and creates a new FASB ASC Topic 606 (“ASC 606”). FASB ASC 606, implements a five-step process for customer contract revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards. ASC 606 also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenues and cash flows from contracts with customers. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. Entities can transition to the standard either retrospectively or as a cumulative-effect adjustment as of the date of adoption. ASC 606 is effective for public entities for annual periods beginning after December 15, 2017 (fiscal year 2018 for the Company), and interim periods within the year of adoption. The Company will adopt these updates beginning with the first quarter of its fiscal year 2018 using the modified retrospective transition approach in which the cumulative effect of initially applying ASC 606 will be recognized at the date of initial application, January 1, 2018. The Company has completed their analysis on the adoption of ASU 2014-09 and has determined the adoption will not have a material impact on the recognition of revenue. However, ASU 2014-09 requires enhanced disclosures about the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, which we fully expect to disclose in connection with our 10Q filing for the first quarter of 2018. We are in the process of implementing appropriate changes to our processes, systems and controls to support revenue recognition and the expanded qualitative and quantitative disclosures required under the new standard. In February 2016, the FASB issued ASU No. 2016-02 , Leases (“ASU 2016-02”). Under ASU 2016-02, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018 (fiscal year 2019 for the Company), including interim periods within those fiscal years. Early application is permitted. Lessees must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees may not apply a full retrospective transition approach. The Company is currently evaluating the impact of adopting ASU 2016-02 on its consolidated financial statements and disclosures. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”), which is intended to reduce the existing diversity in practice in how certain cash receipts and cash payments are classified in the statement of cash flows. ASU 2016-15 is effective for fiscal years beginning after December 15, 2017 (fiscal year 2018 for the Company), including interim periods within those fiscal years with early adoption permitted, provided that all of the amendments are adopted in the same period. The Company is currently evaluating the impact of adopting ASU 2016-15 on its consolidated financial statements and disclosures. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory (“ASU 2016-16”), which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. This amends current U.S. GAAP which prohibits recognition of current and deferred income taxes for all types of intra-entity asset transfers until the asset has been sold to an outside party. ASU 2016-16 is effective for fiscal years beginning after December 15, 2017 (fiscal year 2018 for the Company), including interim periods therein with early application permitted. Upon adoption, the Company must apply a modified retrospective transition approach through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and disclosures, as well as its planned adoption date. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230), Restricted Cash (“ASU 2016-18”), which enhances and clarifies the guidance on the classification and presentation of restricted cash in the statement of cash flows. ASU 2016-18 is effective for fiscal periods beginning after December 15, 2018 (fiscal year 2019 for the Company), including interim periods therein with early application permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and disclosures. In May 2017, the FASB issued ASU No. 2017-09, Scope of Modification Accounting , which amends ASC Topic 718, Compensation – Stock Compensation (“ASU 2017-09”). The ASU includes provisions intended to (1) provide clarity and (2) reduce diversity in practice and reduce cost and complexity when calculating stock compensation, on a change to the terms and conditions of a share-based award. ASU 2017-09 is effective for public business entities for annual reporting periods, and interim periods within those annual periods, beginning after December 15, 2017. The Company will adopt in the first quarter of its fiscal year 2018. Based on the work completed to date, management anticipates the adoption of ASU No. 2017-09 will not have a material impact on its consolidated financial statements and disclosures.

Supplemental Financial Inform22

Supplemental Financial Information (Tables)	12 Months Ended
	Dec. 30, 2017
Supplemental Financial Information
Schedule Of Inventories	December 30, December 31, 2017 2016 (in thousands) Raw materials $ 768 $ 884 Work in process 88 47 Finished goods 3,249 2,229 $ 4,105 $ 3,160
Property, Plant And Equipment	Estimated Useful December 30, December 31, Lives 2017 2016 (dollars in thousands) Machinery and equipment 3 - 7 yrs. $ 8,823 $ 8,941 Leasehold improvements * 878 878 Furniture and fixtures 5 yrs. 375 375 Computer equipment and software 3 - 7 yrs. 4,017 4,045 14,093 14,239 Less accumulated depreciation and amortization (13,634) (13,594) $ 459 $ 645 * Estimated useful life is generally seven years, or the remaining lease term, whichever is shorter.
Schedule Of Warranty Liability Activity	Year Ended December 30, December 31, 2017 2016 (in thousands) Beginning balance $ 89 $ 122 Estimated cost of warranty claims charged to cost of sales 221 49 Cost of actual warranty claims (158) (82) Ending balance 152 89 Less current portion (91) (53) Long-term warranty liability $ 61 $ 36
Schedule Of Computation Of Net Loss Per Share	Year Ended December 30, December 31, 2017 2016 Basic and diluted net loss per share: Numerator: Net loss $ (13,420) $ (11,231) Denominator: Weighted-average common shares outstanding, basic and diluted 65,513 53,784 Basic and diluted net loss per share $ (0.20) $ (0.21)
Schedule Of Potential Common Shares Excluded From The Diluted Net Loss Per Share Calculations	Year Ended December 30, December 31, 2017 2016 (in thousands) Common share equivalents 12,855 12,883
Schedule Of Supplemental Disclosures Of Cash Flow Information And Non-Cash Financing Activities	Year Ended December 30, December 31, 2017 2016 (in thousands) Supplemental disclosure of cash flow information: Cash paid during the year for: Interest $ 61 $ 131 Income taxes $ 4 $ - Supplemental disclosure of non-cash financing activities: Debt financing of insurance $ 220 $ 264 Acquisition of equipment through capital lease $ - $ 179

Debt (Tables)

Debt (Tables)	12 Months Ended
	Dec. 30, 2017
Debt
Schedule Of Long-Term Debt	December 30, December 31, 2017 2016 (in thousands) Convertible promissory note, SVIC, net of debt discount of $868 and $1,084 in 2017 and 2016, respectively $ 14,132 $ 13,916 Accrued interest on convertible promissory note with SVIC 634 335 Notes payable and capital lease obligation - 151 $ 14,766 $ 14,402 Less current portion - (151) $ 14,766 $ 14,251
Schedule of Maturities Of Long-term Debt	Fiscal Year (in thousands) 2018 $ - 2019 - 2020 - 2021 15,634 Total payments on long-term debt 15,634 Less debt discount and debt issuance costs (868) Long-term debt $ 14,766
Schedule Of Interest Expense Related To Long-Term Debt	Year Ended December 30, December 31, 2017 2016 (in thousands) Interest expense: SVB $ 46 $ 48 SVIC 515 523 Others 20 23 581 594 Interest income (17) (16) $ 564 $ 578

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 30, 2017
Income Taxes
Schedule Of Deferred Tax Assets And Liabilities	December 30, December 31, 2017 2016 Deferred tax assets: (in thousands) Reserves and allowances $ $ State taxes, net of federal income tax benefit - Depreciation and amortization Other accruals Compensatory stock options and rights Basis difference in warrant value - Other Tax credit carryforwards Operating loss carryforward Foreign operating loss carryforward Total deferred tax assets 30,802 44,512 Deferred tax liabilities: Prepaid expenses (36) (76) Basis difference in warrant value - (73) Total deferred tax liabilities (36) (149) Subtotal 30,766 44,363 Valuation allowance (30,766) (44,363) $ - $ -
Schedule Of Income before Income Tax, Domestic And Foreign	Year Ended December 30, December 31, 2017 2016 (in thousands) United States $ (12,871) $ (10,606) Foreign (543) (620) $ (13,414) $ (11,226)
Schedule Of Income Tax Provisions	Year Ended December 30, December 31, 2017 2016 (in thousands) Current: Federal $ - $ - State 6 5 Total current 6 5 Deferred: Federal 10,678 (3,349) State 2,577 (1,607) Foreign 342 288 Change in valuation allowance (13,597) 4,668 Total deferred - - Income tax provision $ 6 $ 5
Schedule Of Effective Income Tax Rate Reconciliation	Year Ended December 30, December 31, 2017 2016 U.S. federal statutory tax 34 % 34 % Valuation allowance (31) (29) Loss from foreign subsidiary (1) (2) Other (2) (3) Effective income tax provision rate - % - %

Commitments and Contingencies (

Commitments and Contingencies (Tables)	12 Months Ended
	Dec. 30, 2017
Commitments and Contingencies
Schedule of Future Minimum Rental Payments for Operating Leases	Operating Fiscal Year Leases 2018 $ 313 2019 92 Total minimum lease payments $ 405

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)	12 Months Ended
	Dec. 30, 2017
Stockholders' Equity
Schedule Of Common Stock Options Activity	Stock Options Outstanding Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Shares Exercise Life Value (in thousands) Price (in years) (in thousands) Options outstanding - January 2, 2016 8,944 $ 1.98 Options granted 1,530 1.10 Options exercised (293) 0.70 Options cancelled (1,383) 4.69 Options outstanding - December 31, 2016 8,798 1.46 Options granted 1,455 0.99 Options exercised (267) 0.68 Options cancelled (1,241) 1.77 Options outstanding - December 30, 2017 8,745 $ 1.39 $ 0.1 Options exercisable - December 30, 2017 6,185 $ 1.56 $ 0.1 Options exercisable and expected to vest - December 30, 2017 8,447 $ 1.40 $ 0.1
Schedule Of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range	The following table summarizes information about stock options outstanding and exercisable at December 30, 2017: Stock Options Outstanding Stock Options Exercisable Weighted Weighted Average Average Remaining Weighted Remaining Weighted Number of Contractual Average Number of Contractual Average shares Life Exercise shares Life Exercise Exercise Price Range (in thousands) (in years) Price (in thousands) (in years) Price $0.20 - $1.00 3,914 6.6 $ 0.73 2,673 5.9 $ 0.73 $1.01 - $2.00 2,619 7.5 $ 1.33 1,324 6.3 $ 1.48 $2.01 - $3.00 1,507 3.4 $ 2.17 1,483 3.3 $ 2.17 $3.01 - $5.00 705 3.9 $ 3.60 705 3.9 $ 3.60 8,745 6.1 $ 1.39 6,185 5.2 $ 1.56
Schedule Of Assumptions Used To Calculate Weighted-Average Grant Date Fair Value Of Common Stock Options Granted	Year Ended December 30, December 31, 2017 2016 Expected term (in years) Expected volatility 87 % 113 % Risk-free interest rate % % Expected dividends $ - $ - Weighted-average grant date fair value per share $ 0.73 $ 0.89 Grant date fair value of options vested (in thousands) $ 1,206 $ 1,352 Intrinsic value of options exercised (in thousands) $ 89 $ 241
Schedule Of Warrant Activity	Weighted Number of Average Shares Exercise (in thousands) Price Warrants outstanding - January 2, 2016 7,633 $ 0.59 Warrant granted - - Warrants exercised (2,709) 0.47 Warrants outstanding - December 31, 2016 4,924 $ 0.66 Warrant granted - - Warrants exercised - - Warrants outstanding - December 30, 2017 4,924 $ 0.66

Major Customers, Suppliers an27

Major Customers, Suppliers and Products (Tables)	12 Months Ended
	Dec. 30, 2017
Major Customers, Suppliers and Products
Schedule Of Customer Concentration of Risk	Year Ended December 30, December 31, 2017 2016 Customer A * % % * less than 10% of total net product sales
Schedule Of Supplier Concentration of Risk	Year Ended December 30, December 31, 2017 2016 Supplier A % % Supplier B % * * Less than 10% of purchases during the period

Quarterly Summary (Unaudited) (

Quarterly Summary (Unaudited) (Tables)	12 Months Ended
	Dec. 30, 2017
Quarterly Summary (Unaudited)
Schedule Of Quarterly Financial Information	Three Months Ended December 30, September 30, July 1, April 1, 2017 2017 2017 2017 (in thousands, except per share data) Net product revenues $ 8,482 $ 9,010 $ 11,404 $ 9,426 Cost of sales 8,075 8,285 10,760 8,746 Gross profit 407 725 644 680 Operating expenses: Research and development 1,089 1,159 1,487 1,496 Intellectual property legal fees 575 749 915 466 Selling, general and administrative 1,729 1,780 1,951 1,914 Total operating expenses 3,393 3,688 4,353 3,876 Operating loss (2,986) (2,963) (3,709) (3,196) Other expense, net: Interest expense, net (143) (135) (138) (148) Other income, net 2 - - 2 Total other expense, net (141) (135) (138) (146) Loss before provision for income taxes (3,127) (3,098) (3,847) (3,342) Provision for income taxes 6 - - - Net loss $ (3,133) $ (3,098) $ (3,847) $ (3,342) Net loss per common share: Basic and diluted $ (0.04) $ (0.05) $ (0.06) $ (0.05) Weighted-average common shares outstanding: Basic and diluted 72,882 65,644 61,844 61,681 Three Months Ended December 31, October 1, July 2, April 2, 2016 2016 2016 2016 (in thousands, except per share data) Net product revenues $ 5,538 $ 2,589 $ 3,500 $ 1,171 NRE revenue - - 3,428 3,429 Total net revenues 5,538 2,589 6,928 4,600 Cost of sales 5,263 2,580 3,267 1,149 Gross profit 275 9 3,661 3,451 Operating expenses: Research and development 1,347 1,463 1,831 1,646 Intellectual property legal fees 855 409 1,023 823 Selling, general and administrative 2,211 2,398 2,159 2,265 Total operating expenses 4,413 4,270 5,013 4,734 Operating loss (4,138) (4,261) (1,352) (1,283) Other income (expense), net: Interest expense, net (150) (159) (132) (137) Other income (expense), net 369 19 (10) 8 Total other income (expense), net 219 (140) (142) (129) Loss before provision for income taxes (3,919) (4,401) (1,494) (1,412) Provision for income taxes 4 - - 1 Net loss $ (3,923) $ (4,401) $ (1,494) $ (1,413) Net loss per common share: Basic and diluted $ (0.06) $ (0.08) $ (0.03) $ (0.03) Weighted-average common shares outstanding: Basic and diluted 61,233 52,454 51,080 50,365

Description of Business (Detail

Description of Business (Details) $ / shares in Units, $ in Thousands	Mar. 26, 2018USD ($)shares	Nov. 14, 2017USD ($)shares	Aug. 22, 2017USD ($)$ / sharesshares	Sep. 23, 2016USD ($)$ / sharesshares	Nov. 12, 2015USD ($)	Mar. 26, 2018USD ($)shares	Dec. 30, 2017USD ($)	Sep. 30, 2017USD ($)	Jul. 01, 2017USD ($)	Apr. 01, 2017USD ($)	Dec. 31, 2016USD ($)	Oct. 01, 2016USD ($)	Jul. 02, 2016USD ($)	Apr. 02, 2016USD ($)	Dec. 30, 2017USD ($)patentshares	Dec. 31, 2016USD ($)shares
Number of issued and pending U.S. and foreign patents | patent															100
Net loss							$ (3,133)	$ (3,098)	$ (3,847)	$ (3,342)	$ (3,923)	$ (4,401)	$ (1,494)	$ (1,413)	$ (13,420)	$ (11,231)
NRE fee received from Samsung					$ 8,000
Proceeds from issuance of SVIC Note and SVIC Warrant					$ 15,000
Common stock shares issued | shares			8,500,000	9,200,000
Shares Issued, Price Per Share | $ / shares			$ 0.60	$ 1.25
Proceeds from issuance of common stock			$ 4,400	$ 10,300											7,224	10,330
Convertible Debt [Member]
Carrying value							14,100				13,900				14,100	13,900
Estimated fair value							$ 12,300				$ 12,200				$ 12,300	$ 12,200
Subsequent Event
Common stock shares issued | shares						6,101,312
Proceeds from issuance of common stock						$ 1,800
Common Stock
Common stock shares issued | shares															17,394,000	9,200,000
ATM Program
Common stock shares issued | shares		8,894,222													8,894,222
Proceeds from issuance of common stock		$ 2,800													$ 2,800
Aggregate gross proceeds agent can sell shares of stock		$ 9,000
ATM Program | Subsequent Event
Common stock shares issued | shares	6,101,312
Proceeds from issuance of common stock	$ 1,800

Summary of Significant Accoun30

Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Restricted cash	$ 2,800	$ 3,100
Minimum
Product warranty period	1 year
Maximum
Product warranty period	3 years

Supplemental Financial Inform31

Supplemental Financial Information (Schedule Of Inventories) (Details) - USD ($) $ in Thousands	Dec. 30, 2017	Dec. 31, 2016
Supplemental Financial Information
Raw materials	$ 768	$ 884
Work in process	88	47
Finished goods	3,249	2,229
Inventories	$ 4,105	$ 3,160

Supplemental Financial Inform32

Supplemental Financial Information (Schedule Of Property, Plant And Equipment) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Property and Equipment
Property and equipment, gross	$ 14,093	$ 14,239
Less accumulated depreciation and amortization	(13,634)	(13,594)
Property and equipment, net	459	645
Machinery and Equipment
Property and Equipment
Property and equipment, gross	8,823	8,941
Leasehold Improvements
Property and Equipment
Property and equipment, gross	878	878
Furniture and Fixtures
Property and Equipment
Property and equipment, gross	$ 375	$ 375
Estimated Useful Life	5 years	5 years
Computer Equipment And Software
Property and Equipment
Property and equipment, gross	$ 4,017	$ 4,045
Minimum | Machinery and Equipment
Property and Equipment
Estimated Useful Life	3 years	3 years
Minimum | Computer Equipment And Software
Property and Equipment
Estimated Useful Life	3 years	3 years
Maximum | Machinery and Equipment
Property and Equipment
Estimated Useful Life	7 years	7 years
Maximum | Leasehold Improvements
Property and Equipment
Estimated Useful Life	7 years
Maximum | Computer Equipment And Software
Property and Equipment
Estimated Useful Life	7 years	7 years

Supplemental Financial Inform33

Supplemental Financial Information (Schedule Of Warranty Liability Activity) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Supplemental Financial Information
Beginning balance	$ 89	$ 122
Estimated cost of warranty claims charged to cost of sales	221	49
Cost of actual warranty claims	(158)	(82)
Ending balance	152	89
Less current portion	(91)	(53)
Long-term warranty liability	$ 61	$ 36

Supplemental Financial Inform34

Supplemental Financial Information (Schedule Of Computation Of Net Loss Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 31, 2016	Oct. 01, 2016	Jul. 02, 2016	Apr. 02, 2016	Dec. 30, 2017	Dec. 31, 2016
Basic and diluted net loss per share:
Numerator: Net loss	$ (3,133)	$ (3,098)	$ (3,847)	$ (3,342)	$ (3,923)	$ (4,401)	$ (1,494)	$ (1,413)	$ (13,420)	$ (11,231)
Denominator: Weighted-average common shares outstanding, basic and diluted	72,882	65,644	61,844	61,681	61,233	52,454	51,080	50,365	65,513	53,784
Basic and diluted net loss per share	$ (0.04)	$ (0.05)	$ (0.06)	$ (0.05)	$ (0.06)	$ (0.08)	$ (0.03)	$ (0.03)	$ (0.20)	$ (0.21)
Common share equivalents									12,855	12,883

Supplemental Financial Inform35

Supplemental Financial Information (Schedule Of Supplemental Disclosures Of Cash Flow Information And Non-Cash Financing Activities) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Supplemental Financial Information
Cash paid for interest	$ 61	$ 131
Cash paid for income taxes	4
Debt financing of insurance	$ 220	264
Acquisition of equipment through capital lease		$ 179

Credit Agreement (SVB Credit Ag

Credit Agreement (SVB Credit Agreement) (Narrative) (Details) - USD ($) $ in Thousands	Oct. 31, 2009	Dec. 30, 2017	Dec. 31, 2016
Line of Credit Facility
Maximum borrowing capacity as a percentage of eligible accounts receivable	80.00%
Maximum borrowing capacity	$ 5,000
Restricted cash		$ 2,800	$ 3,100
Prime Rate
Line of Credit Facility
Debt instrument, basis spread on variable rate		2.75%
Letter of Credit
Line of Credit Facility
Outstanding borrowings		$ 2,800	3,100
Line of Credit
Line of Credit Facility
Outstanding borrowings		2,000	700
Availability remaining		$ 100	$ 800

Debt (Schedule Of Long-Term Deb

Debt (Schedule Of Long-Term Debt) (Details) - USD ($) $ in Thousands	Dec. 30, 2017	Dec. 31, 2016
Debt
Debt outstanding	$ 14,766	$ 14,402
Less current portion		(151)
Long-term debt, net of current portion and debt discount	14,766	14,251
Debt discount and debt issuance costs	868
SVIC Senior Secured Convertible Promissory Note
Debt
Debt outstanding	14,132	13,916
Debt discount and debt issuance costs	868	1,084
Accrued interest on convertible promissory note with SVIC
Debt
Debt outstanding	$ 634	335
Notes payable and capital lease obligation
Debt
Debt outstanding		$ 151

Debt (Narrative) (Details)

Debt (Narrative) (Details) - USD ($)	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016	Jan. 02, 2016	Nov. 30, 2015	Nov. 18, 2015
Long-term debt
Face amount					$ 15,000,000
Interest rate (as a percent)					2.00%
Debt conversion price (in dollars per share)					$ 1.25
Number of shares which may be purchased under warrant					2,000,000
Exercise price of warrants (in dollars per share)	$ 0.66	$ 0.66	$ 0.59		$ 0.30
Amortization of debt discount	$ 216,000	$ 217,000
SVIC Warrant
Long-term debt
Fair value of warrants				$ 1,165,000
SVIC Senior Secured Convertible Promissory Note
Long-term debt
Fair value of warrants					$ 1,165,000
Debt discount fees for professional services					$ 154,000
SVIC Senior Secured Convertible Promissory Note | Interest Expense
Long-term debt
Amortization of debt discount	$ 216,000	$ 217,000

Debt (Schedule Of Maturities Of

Debt (Schedule Of Maturities Of Debt) (Details) $ in Thousands	Dec. 30, 2017USD ($)
Debt
2,021	$ 15,634
Total payments on long-term debt	15,634
Less debt discount and debt issuance costs	(868)
Long-term debt	$ 14,766

Debt (Schedule Of Interest Expe

Debt (Schedule Of Interest Expense) (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 31, 2016	Oct. 01, 2016	Jul. 02, 2016	Apr. 02, 2016	Dec. 30, 2017	Dec. 31, 2016
Interest expense:
Interest expense									$ 581	$ 594
Interest income									(17)	(16)
Interest expense, net	$ 143	$ 135	$ 138	$ 148	$ 150	$ 159	$ 132	$ 137	564	578
Silicon Valley Bank
Interest expense:
Interest expense									46	48
SVIC Senior Secured Convertible Promissory Note
Interest expense:
Interest expense									515	523
Others
Interest expense:
Interest expense									$ 20	$ 23

Income Taxes (Schedule Of Defer

Income Taxes (Schedule Of Deferred Tax Assets And Liabilities) (Details) - USD ($) $ in Thousands	Dec. 30, 2017	Dec. 31, 2016
Deferred tax assets:
Reserves and allowances	$ 843	$ 1,570
State taxes, net of federal income tax benefit		1
Depreciation and amortization	56	146
Other accruals	152	226
Compensatory stock options and rights	1,216	1,996
Basis difference in warrant value	9
Other	31	51
Tax credit carryforwards	4,169	3,906
Operating loss carryforward	23,475	35,424
Foreign operating loss carryforward	851	1,192
Total deferred tax assets	30,802	44,512
Deferred tax liabilities:
Prepaid expenses	(36)	(76)
Basis difference in warrant value		(73)
Total deferred tax liabilities	(36)	(149)
Subtotal	30,766	44,363
Valuation allowance	(30,766)	(44,363)
Deferred Tax Assets, Net, Total	$ 0	$ 0

Income Taxes (Narrative) (Detai

Income Taxes (Narrative) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 30, 2017	Dec. 31, 2016
Operating Loss Carryforwards.
Increase (Decrease) in valuation allowance		$ (13.6)	$ 4.7
U.S. federal statutory tax		34.00%	34.00%
Tax cuts and jobs act impact on deferred tax asset		$ 14.7
Unrecognized Tax Benefits		0
Accrued interest and penalties related to uncertain tax matters		0	$ 0
Federal
Operating Loss Carryforwards.
Net operating loss carryforwards		104
Tax credit carryforwards		$ 2
Tax Credit Carryforward, Expiration Date		Dec. 31, 2026
State and Local Jurisdiction
Operating Loss Carryforwards.
Net operating loss carryforwards		$ 60
Operating Loss Carryforwards, Expiration Date		Dec. 31, 2018
Tax credit carryforwards		$ 2.2
Net operating loss carryforwards expired		2
Foreign Tax Authority
Operating Loss Carryforwards.
Net operating loss carryforwards		3.3
Net operating loss carryforwards expired		$ 0.5
Maximum
Operating Loss Carryforwards.
U.S. federal statutory tax		35.00%
Forecast
Operating Loss Carryforwards.
U.S. federal statutory tax	21.00%

Income Taxes (Components of Los

Income Taxes (Components of Loss Before Provision for Income Taxes) (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 31, 2016	Oct. 01, 2016	Jul. 02, 2016	Apr. 02, 2016	Dec. 30, 2017	Dec. 31, 2016
Income Taxes
United States									$ (12,871)	$ (10,606)
Foreign									(543)	(620)
Loss before provision for income tax	$ (3,127)	$ (3,098)	$ (3,847)	$ (3,342)	$ (3,919)	$ (4,401)	$ (1,494)	$ (1,412)	$ (13,414)	$ (11,226)

Income Taxes (Provision for Inc

Income Taxes (Provision for Income Taxes) (Details) - USD ($) $ in Thousands	3 Months Ended			12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016	Apr. 02, 2016	Dec. 30, 2017	Dec. 31, 2016
Current:
Federal				$ 0	$ 0
State				6	5
Total Current				6	5
Deferred:
Federal				10,678	(3,349)
State				2,577	(1,607)
Foreign				342	288
Change in valuation allowance				(13,597)	4,668
Total Deferred				0	0
Income tax provision	$ 6	$ 4	$ 1	$ 6	$ 5

Income Taxes (Reconciliation of

Income Taxes (Reconciliation of Income Taxes by Applying the Statutory U.S. Income Tax Rate) (Details)	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Income Taxes
U.S. federal statutory tax	34.00%	34.00%
Valuation allowance	(31.00%)	(29.00%)
Loss from foreign subsidiary	(1.00%)	(2.00%)
Other	(2.00%)	(3.00%)
Effective income tax provision rate

Commitments and Contingencies46

Commitments and Contingencies (Schedule of Future Minimum Lease Payments) (Details) - USD ($)	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Commitments and Contingencies
Rental expense, net	$ 530,000	$ 482,000
2,018	313,000
2,019	92,000
Total minimum lease payments	$ 405,000

Commitments and Contingencies47

Commitments and Contingencies (Litigations and Patent Reexaminations) (Details)	Oct. 31, 2017patent	Sep. 01, 2016patent	Mar. 31, 2016USD ($)	Dec. 30, 2017USD ($)claimpatent
Commitments and Contingencies
Legal expenses excluded as a result of TRGP's payment of these expenses under the TRGP Agreement				$ 10,200,000
Inphi Litigation
Commitments and Contingencies
Number of patents claimed to be invalid | patent				3
912 Patent Reexamination
Commitments and Contingencies
Number of claims rejected | claim				11
SK Hynix Litigation
Commitments and Contingencies
Number of patents infringed upon | patent	2	6
Morgan Joseph Litigation | Compensatory damages
Commitments and Contingencies
Damages sought by plaintiff			$ 1,012,500
Morgan Joseph Litigation | Punitive damages
Commitments and Contingencies
Damages sought by plaintiff			$ 1,000,000

Stockholders' Equity (Narrative

Stockholders' Equity (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands	Mar. 26, 2018	Nov. 14, 2017	Aug. 22, 2017	Apr. 17, 2017	Jan. 01, 2017	Sep. 23, 2016	Mar. 26, 2018	Dec. 30, 2017	Dec. 31, 2016
Serial Preferred Stock
Preferred Stock, Shares Authorized								10,000,000	10,000,000
Preferred Stock, Par or Stated Value Per Share								$ 0.001	$ 0.001
Purchase price per share			$ 0.60			$ 1.25
Common Stock
Common stock, shares authorized								150,000,000	90,000,000
Common stock shares issued			8,500,000			9,200,000
Proceeds from issuance of common stock			$ 4,400			$ 10,300		$ 7,224	$ 10,330
Stock-Based Compensation
Shares available for issuance								1,082,880
Shares authorized for issuance								11,405,566
Automatic annual increase in shares authorized as percentage of common stock outstanding					2.50%			5.00%
Automatic annual increase in shares authorized, subject to adjustment for corporate actions								1,200,000
Rate of vesting of options granted								25.00%
Vesting period of options granted, in years								4 years
Expiration of vested options, period from date of grant								10 years
Series A Preferred Stock
Serial Preferred Stock
Preferred Stock, Shares Authorized								1,000,000	1,000,000
Stock-Based Compensation
Shares available for issuance				1,000,000
Subsequent Event
Common Stock
Common stock shares issued							6,101,312
Proceeds from issuance of common stock							$ 1,800
ATM Program
Common Stock
Service fee percentage		3.00%
Common stock shares issued		8,894,222						8,894,222
Aggregate gross proceeds agent can sell shares of stock		$ 9,000
Proceeds from issuance of common stock		$ 2,800						$ 2,800
ATM Program | Subsequent Event
Common Stock
Common stock shares issued	6,101,312
Proceeds from issuance of common stock	$ 1,800
Rights Agreement
Serial Preferred Stock
Number of Rights Authorized for Each Outstanding Share of Stock				1
Number of Days Rights are to be Distributed				10 days
Minimum Beneficial Ownership Percentage for Rights to be Distributed				15.00%
Rights Agreement | Series A Preferred Stock
Serial Preferred Stock
Number of Shares Issued when Right is Exercised				0.001
Purchase price per share				$ 6.56

Stockholders' Equity (Schedule

Stockholders' Equity (Schedule Of Stock Option Activity) (Details) - USD ($) $ / shares in Units, shares in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Number of Shares
Options outstanding, Number of Shares, Beginning Balance	8,798	8,944
Options granted, Number of Shares	1,455	1,530
Options exercised, Number of Shares	(267)	(293)
Options expired/forfeited, Number of Shares	(1,241)	(1,383)
Options outstanding, Number of Shares, Ending Balance	8,745	8,798
Weighted-Average Exercise Price
Options outstanding, Weighted-Average Exercise Price, Beginning Balance	$ 1.46	$ 1.98
Options granted, Weighted-Average Exercise Price	0.99	1.10
Options exercised, Weighted-Average Exercise Price	0.68	0.70
Options expired/forfeited, Weighted Average Exercise Price	1.77	4.69
Options outstanding, Weighted-Average Exercise Price, Ending Balance	$ 1.39	$ 1.46
Options outstanding, Weighted-Average Remaining Contractual Life	6 years 1 month 6 days
Options outstanding, Aggregate Intrinsic Value	$ 100
Options exercisable, Number of Shares	6,185
Options exercisable, Weighted-Average Exercise Price	$ 1.56
Options exercisable, Weighted-Average Remaining Contractual Life	5 years 2 months 12 days
Additional Disclosure
Options exercisable, Aggregate Intrinsic Value	$ 100
Options exercisable and expected to vest, Number of Shares	8,447
Options exercisable and expected to vest, Weighted-Average Exercise Price	$ 1.40
Options exercisable and expected to vest, Weighted-Average Remaining Contractual Life	6 years
Options exercisable and expected to vest, Aggregate Intrinsic Value	$ 100

Stockholders' Equity (Summary O

Stockholders' Equity (Summary Of Stock Options By Exercise Price Range) (Details) - $ / shares shares in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016	Jan. 02, 2016
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Options outstanding, Number of Shares	8,745	8,798	8,944
Options outstanding, Weighted-Average Remaining Contractual Life	6 years 1 month 6 days
Options outstanding, Weighted-Average Exercise Price	$ 1.39	$ 1.46	$ 1.98
Options exercisable, Number of Shares	6,185
Options exercisable, Weighted-Average Remaining Contractual Life	5 years 2 months 12 days
Options exercisable, Weighted-Average Exercise Price	$ 1.56
$0.20 - $1.00
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, Lower Limit	0.20
Range of Exercise Prices, Upper Limit	$ 1
Options outstanding, Number of Shares	3,914
Options outstanding, Weighted-Average Remaining Contractual Life	6 years 7 months 6 days
Options outstanding, Weighted-Average Exercise Price	$ 0.73
Options exercisable, Number of Shares	2,673
Options exercisable, Weighted-Average Remaining Contractual Life	5 years 10 months 24 days
Options exercisable, Weighted-Average Exercise Price	$ 0.73
$1.01 - $2.00
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, Lower Limit	1.01
Range of Exercise Prices, Upper Limit	$ 2
Options outstanding, Number of Shares	2,619
Options outstanding, Weighted-Average Remaining Contractual Life	7 years 6 months
Options outstanding, Weighted-Average Exercise Price	$ 1.33
Options exercisable, Number of Shares	1,324
Options exercisable, Weighted-Average Remaining Contractual Life	6 years 3 months 18 days
Options exercisable, Weighted-Average Exercise Price	$ 1.48
$2.01 - $3.00
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, Lower Limit	2.01
Range of Exercise Prices, Upper Limit	$ 3
Options outstanding, Number of Shares	1,507
Options outstanding, Weighted-Average Remaining Contractual Life	3 years 4 months 24 days
Options outstanding, Weighted-Average Exercise Price	$ 2.17
Options exercisable, Number of Shares	1,483
Options exercisable, Weighted-Average Remaining Contractual Life	3 years 3 months 18 days
Options exercisable, Weighted-Average Exercise Price	$ 2.17
$3.01 - $5.00
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, Lower Limit	3.01
Range of Exercise Prices, Upper Limit	$ 5
Options outstanding, Number of Shares	705
Options outstanding, Weighted-Average Remaining Contractual Life	3 years 10 months 24 days
Options outstanding, Weighted-Average Exercise Price	$ 3.60
Options exercisable, Number of Shares	705
Options exercisable, Weighted-Average Remaining Contractual Life	3 years 10 months 24 days
Options exercisable, Weighted-Average Exercise Price	$ 3.60

Stockholders' Equity (Schedul51

Stockholders' Equity (Schedule Of Assumptions Used To Calculate Weighted-Average Grant Date Fair Value Of Common Stock Options Granted) (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Expected term (in years)	6 years 6 months	6 years 1 month 6 days
Expected volatility	87.00%	113.00%
Risk-free interest rate	2.05%	1.50%
Weighted-average grant date fair value per share	$ 0.73	$ 0.89
Grant date fair value of options vested	$ 1,206	$ 1,352
Intrinsic value of options exercised	89	$ 241
Restricted Stock
Unearned stock-based compensation related to unvested common stock options and restricted stock awards	$ 1,300
Weighted-average period over which unearned stock-based compensation is expected to be recognized	2 years 2 months 12 days

Stockholders' Equity (Warrants)

Stockholders' Equity (Warrants) (Narrative) (Details)	Aug. 22, 2017shares	Dec. 22, 2016USD ($)shares	Nov. 22, 2016shares	Sep. 23, 2016shares	Aug. 29, 2016shares	Apr. 04, 2016shares	Nov. 30, 2015USD ($)item$ / sharesshares	Dec. 30, 2017$ / sharesshares	Dec. 31, 2016$ / sharesshares	Jan. 02, 2016$ / sharesshares	Nov. 18, 2015$ / sharesshares
Class of Warrant or Right [Line Items]
Warrants outstanding								4,924,000	4,924,000	7,633,000
Exercise price of warrants | $ / shares								$ 0.66	$ 0.66	$ 0.59	$ 0.30
Number of shares which may be purchased under warrant											2,000,000
Common stock shares issued	8,500,000			9,200,000
Number of law firms | item							2
SVIC Warrant
Class of Warrant or Right [Line Items]
Fair value of warrants | $							$ 1,165,000
Amended Drawbridge Warrant
Class of Warrant or Right [Line Items]
Warrants outstanding					648,351	1,000,000
Warrant Term							7 years
Number of shares which may be purchased under warrant							1,648,351
Common stock shares issued					465,555	674,300
Fair value of warrants | $							$ 129,000
Amended Drawbridge Warrant | Minimum
Class of Warrant or Right [Line Items]
Exercise price of warrants | $ / shares							$ 0.47
Amended Drawbridge Warrant | Maximum
Class of Warrant or Right [Line Items]
Exercise price of warrants | $ / shares							$ 1
Fortress Warrant
Class of Warrant or Right [Line Items]
Warrant Term							10 years
Exercise price of warrants | $ / shares							$ 0.47
Number of shares which may be purchased under warrant			1,000,000				1,000,000
Common stock shares issued			605,599
Fair value of warrants | $							$ 624,000
Law Firm One Warrants
Class of Warrant or Right [Line Items]
Exercise price of warrants | $ / shares							$ 0.64
Number of shares which may be purchased under warrant		60,000					300,000
Gross proceeds | $		$ 27,000
Fair value of warrants | $							$ 185,000
Law Firm Two Warrants
Class of Warrant or Right [Line Items]
Exercise price of warrants | $ / shares							$ 0.45
Number of shares which may be purchased under warrant							60,000
Fair value of warrants | $							$ 49,000

Stockholders' Equity (Schedul53

Stockholders' Equity (Schedule Of Warrants) (Details) shares in Thousands	12 Months Ended
	Dec. 31, 2016$ / sharesshares
Number of Shares
Warrants outstanding, Number of Shares, Beginning balance | shares	7,633
Warrants exercised, Number of Shares | shares	(2,709)
Warrants outstanding, Number of Shares, Ending balance | shares	4,924
Weighted-Average Exercise Price
Warrants outstanding, Weighted-Average Exercise Price, Beginning balance | $ / shares	$ 0.59
Warrants exercised, Weighted-Average Exercise Price | $ / shares	0.47
Warrants outstanding, Weighted-Average Exercise Price, Ending balance | $ / shares	$ 0.66

401(k) Plan (Narrative) (Detail

401(k) Plan (Narrative) (Details) - USD ($)	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
401(k) Plan
Minimum participant age	21 years
Employer contributions	$ 100,000	$ 123,000

Major Customers, Suppliers an55

Major Customers, Suppliers and Products (Schedule Of Customer Concentration of Risk) (Details) - customer	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Sales Revenue, Resale of Products
Concentration Risk
Concentration Risk, Percentage	85.00%	66.00%
Customer Concentration Risk | Sales Revenue, Product Line | Customer A
Concentration Risk
Concentration Risk, Percentage		16.00%
Customer Concentration Risk | Accounts Receivable
Concentration Risk
Concentration Risk, Number of Customers	3	2
Customer Concentration Risk | Accounts Receivable | Customer A
Concentration Risk
Concentration Risk, Percentage	15.00%	27.00%
Customer Concentration Risk | Accounts Receivable | Customer B
Concentration Risk
Concentration Risk, Percentage	13.00%
Customer Concentration Risk | Accounts Receivable | Customer C
Concentration Risk
Concentration Risk, Percentage	12.00%	11.00%

Major Customers, Suppliers an56

Major Customers, Suppliers and Products (Schedule Of Supplier Concentration of Risk) (Details) - Supplier Concentration Risk [Member] - Cost of Goods, Total [Member]	12 Months Ended
	Dec. 30, 2017	Dec. 31, 2016
Supplier A
Concentration Risk
Concentration Risk, Percentage	60.00%	73.00%
Supplier B
Concentration Risk
Concentration Risk, Percentage	10.00%

Segment and Geographic Inform57

Segment and Geographic Information (Details) $ in Thousands	12 Months Ended
	Dec. 30, 2017USD ($)segment	Dec. 31, 2016USD ($)
Segment and Geographic Information
Number of reportable segments | segment	1
Percentage of net sales derived from shipments to international destinations	67.00%	26.00%
Net long-lived assets located in the PRC | $	$ 70	$ 60

Quarterly Summary (Unaudited)58

Quarterly Summary (Unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 31, 2016	Oct. 01, 2016	Jul. 02, 2016	Apr. 02, 2016	Dec. 30, 2017	Dec. 31, 2016
Quarterly Summary (Unaudited)
Net product revenues	$ 8,482	$ 9,010	$ 11,404	$ 9,426	$ 5,538	$ 2,589	$ 3,500	$ 1,171	$ 38,322	$ 12,798
NRE Revenue							3,428	3,429		6,857
Total net revenues					5,538	2,589	6,928	4,600	38,322	19,655
Cost of sales	8,075	8,285	10,760	8,746	5,263	2,580	3,267	1,149	35,866	12,259
Gross profit	407	725	644	680	275	9	3,661	3,451	2,456	7,396
Research and development	1,089	1,159	1,487	1,496	1,347	1,463	1,831	1,646	5,231	6,287
Legal expenses	575	749	915	466		409	1,023	823	2,705	3,110
Intellectual property legal fees, net of settlement transactions					855
Selling, general and administrative	1,729	1,780	1,951	1,914	2,211	2,398	2,159	2,265	7,374	9,033
Total operating expenses	3,393	3,688	4,353	3,876	4,413	4,270	5,013	4,734	15,310	18,430
Operating loss	(2,986)	(2,963)	(3,709)	(3,196)	(4,138)	(4,261)	(1,352)	(1,283)	(12,854)	(11,034)
Interest expense, net	(143)	(135)	(138)	(148)	(150)	(159)	(132)	(137)	(564)	(578)
Other income (expense), net	2			2	369	19	(10)	8	4	386
Total other expense, net	(141)	(135)	(138)	(146)	219	(140)	(142)	(129)	(560)	(192)
Loss before provision for income taxes	(3,127)	(3,098)	(3,847)	(3,342)	(3,919)	(4,401)	(1,494)	(1,412)	(13,414)	(11,226)
Provision for income taxes	6				4			1	6	5
Net loss	$ (3,133)	$ (3,098)	$ (3,847)	$ (3,342)	$ (3,923)	$ (4,401)	$ (1,494)	$ (1,413)	$ (13,420)	$ (11,231)
Basic and diluted	$ (0.04)	$ (0.05)	$ (0.06)	$ (0.05)	$ (0.06)	$ (0.08)	$ (0.03)	$ (0.03)	$ (0.20)	$ (0.21)
Basic and diluted	72,882	65,644	61,844	61,681	61,233	52,454	51,080	50,365	65,513	53,784