Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Jun. 25, 2016 | Jul. 31, 2016 | |
Document Information [Line Items] | ||
Entity Registrant Name | GIGA TRONICS INC | |
Entity Central Index Key | 719,274 | |
Trading Symbol | giga | |
Current Fiscal Year End Date | --03-26 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 9,549,703 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 25, 2016 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 25, 2016 | Mar. 26, 2016 |
Series B, C, and D Preferred Stock [Member] | ||
Shareholders' equity: | ||
Preferred stock | $ 2,911,000 | $ 2,911,000 |
Cash and cash-equivalents | 1,796,000 | 1,331,000 |
Trade accounts receivable, net of allowance of $45, respectively | 1,825,000 | 2,129,000 |
Inventories, net | 6,247,000 | 5,694,000 |
Prepaid expenses and other current assets | 258,000 | 318,000 |
Total current assets | 10,126,000 | 9,472,000 |
Property and equipment, net | 776,000 | 837,000 |
Other long term assets | 8,000 | 8,000 |
Capitalized software development costs | 1,210,000 | 876,000 |
Total assets | 12,120,000 | 11,193,000 |
Line of credit | 800,000 | 800,000 |
Current portion of long term debt, net of discount and issuance costs | 254,000 | 370,000 |
Accounts payable | 1,751,000 | 1,924,000 |
Accrued payroll and benefits | 728,000 | 647,000 |
Deferred revenue | 3,905,000 | 2,804,000 |
Deferred rent | 78,000 | 110,000 |
Capital lease obligations | 45,000 | 44,000 |
Deferred liability related to asset sale | 750,000 | 375,000 |
Other current liabilities | 399,000 | 621,000 |
Total current liabilities | 8,710,000 | 7,695,000 |
Warrant liability, at estimated fair value | 307,000 | 353,000 |
Long term obligations - capital lease | 153,000 | 165,000 |
Total liabilities | 9,170,000 | 8,213,000 |
Common stock of no par value; Authorized - 40,000,000 shares; 9,549,703 shares at June 25, 2016 and March 26, 2016 issued and outstanding | 24,176,000 | 24,104,000 |
Accumulated deficit | (24,137,000) | (24,035,000) |
Total shareholders' equity | 2,950,000 | 2,980,000 |
Total liabilities and shareholders' equity | $ 12,120,000 | $ 11,193,000 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - USD ($) $ in Thousands | Jun. 25, 2016 | Mar. 26, 2016 |
Series A Preferred Stock [Member] | ||
Preferred stock, authorized (in shares) | 250,000 | 250,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Series B, C, and D Preferred Stock [Member] | ||
Preferred stock, authorized (in shares) | 19,500 | 19,500 |
Preferred stock, issued (in shares) | 18,533.51 | 18,533.51 |
Preferred stock, outstanding (in shares) | 18,533.51 | 18,533.51 |
Preferred stock, liquidation preference | $ 3,540 | $ 3,540 |
Trade accounts receivable, allowance | $ 45 | $ 45 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, authorized (in shares) | 40,000,000 | 40,000,000 |
Common stock, issued (in shares) | 9,549,703 | 9,549,703 |
Common stock, outstanding (in shares) | 9,549,703 | 9,549,703 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands | 3 Months Ended | |
Jun. 25, 2016 | Jun. 27, 2015 | |
Net sales | $ 3,442,000 | $ 4,375,000 |
Cost of sales | 2,517,000 | 2,647,000 |
Gross margin | 925,000 | 1,728,000 |
Operating expenses: | ||
Engineering | 530,000 | 746,000 |
Selling, general and administrative | 1,305,000 | 1,455,000 |
Total operating expenses | 1,835,000 | 2,201,000 |
Operating loss | (910,000) | (473,000) |
Net gain recognized in the quarter | 802,000 | |
Gain/(loss) on adjustment of warrant liability to fair value | 46,000 | (63,000) |
Interest expense: | ||
Interest expense, net | (29,000) | (51,000) |
Interest expense from accretion of loan discount | (11,000) | (42,000) |
Total interest expense, net | (40,000) | (93,000) |
Loss before income taxes | (102,000) | (629,000) |
Provision for income taxes | 0 | 0 |
Net loss | $ (102,000) | $ (629,000) |
Loss per common share - basic (in dollars per share) | $ (0.01) | $ (0.10) |
Loss per common share - diluted (in dollars per share) | $ (0.01) | $ (0.10) |
Weighted average common shares used in per share calculation: | ||
Basic (in shares) | 9,550 | 6,251 |
Diluted (in shares) | 9,550 | 6,251 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 25, 2016 | Jun. 27, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (102,000) | $ (629,000) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 91,000 | 74,000 |
Share based compensation | 72,000 | 335,000 |
Adjustment of warrant liability to fair value | (46,000) | 63,000 |
Capitalized software development costs | (334,000) | |
Accretion of discounts on debt | 11,000 | 42,000 |
Change in deferred rent | (32,000) | (28,000) |
Gain on sale of product line | (802,000) | |
Changes in operating assets and liabilities: | ||
Trade accounts receivable | 304,000 | (266,000) |
Inventories | (553,000) | (424,000) |
Prepaid expenses and other assets | 63,000 | 41,000 |
Accounts payable | (173,000) | 861,000 |
Accrued payroll and benefits | 81,000 | (102,000) |
Deferred revenue | 1,101,000 | (307,000) |
Other current liabilities | (270,000) | (152,000) |
Net cash used in operating activities | (589,000) | (492,000) |
Cash flows from investing activities: | ||
Cash received from Astronics | 1,225,000 | |
Purchases of property and equipment | (30,000) | (28,000) |
Net cash provided by (used in) investing activities | 1,195,000 | (28,000) |
Cash flows from financing activities: | ||
Payments on capital leases | (11,000) | (27,000) |
Proceeds from line of credit | 500,000 | |
Proceeds from exercise of stock options | 22,000 | |
Repayments of debt | (130,000) | (141,000) |
Net cash (used in) provided by financing activities | (141,000) | 354,000 |
(Decrease)/Increase in cash and cash-equivalents | 465,000 | (166,000) |
Beginning cash and cash-equivalents | 1,331,000 | 1,170,000 |
Ending cash and cash-equivalents | 1,796,000 | 1,004,000 |
Supplementary disclosure of cash flow information: | ||
Cash paid for income taxes | ||
Cash paid for interest | 23,000 | 43,000 |
Supplementary disclosure of noncash investing and financing activities: | ||
Equipment disposal | $ 67,000 |
Note 1 - Organization and Signi
Note 1 - Organization and Significant Accounting Policies | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Significant Accounting Policies [Text Block] | (1) Organization and Significant Accounting Policies The condensed consolidated financial statements included herein have been prepared by Giga-tronics Incorporated (the “Company”), pursuant to the rules and regulations of the Securities and Exchange Commission. The consolidated results of operations for the interim periods shown in this report are not necessarily indicative of results to be expected for the fiscal year. In the opinion of management, the information contained herein reflects all adjustments (consisting of normal recurring entries) necessary to make the consolidated results of operations for the interim periods a fair statement of such operations. For further information, refer to the consolidated financial statements and footnotes thereto, included in the Annual Report on Form 10-K, filed with the Securities and Exchange Commission for the year ended March 26, 2016. Principles of Consolidation Reclassifications Derivatives Software Development Costs Discontinued Operations (see Note 9, Sale of Product Lines) concluding that each product line does not meet the definition of a “component of an entity” as defined by ASC 205-20.The Company is able to distinguish revenue and gross margin information as disclosed in Note 9, Sale of Product Lines to the accompanying financial statements however, operations and cash flow information is not clearly distinguishable and the company is unable to present meaningful information about results of operations and cash flows from those product lines. New Accounting Standards Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing Revenue from Contracts with Customers (Topic 606) |
Note 2 - Going Concern and Mana
Note 2 - Going Concern and Management's Plan | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Substantial Doubt about Going Concern [Text Block] | (2) Going Concern and Management’s Plan The Company incurred net losses of $102,000 and $629,000 in the first quarter of fiscal 2017 and fiscal 2016, respectively. These losses have contributed to an accumulated deficit of $24.1 million as of June 25, 2016. The Company has experienced delays in the development of features, orders, and shipments for the new Advanced Signal Generator (“ASG”). These delays have contributed, in part to a decrease in working capital from $1.8 million at March 26, 2016, to $1.4 million at June 25, 2016. The new ASG product has shipped to several customers, but potential delays in the development of features, longer than anticipated sales cycles, or the ability to efficiently manufacture the ASG, could significantly contribute to additional future losses and decreases in working capital. To help fund operations, the Company relies on advances under the line of credit with Bridge Bank. The line of credit expires on May 7, 2017. The agreement includes a subjective acceleration clause, which allows for amounts due under the facility to become immediately due in the event of a material adverse change in the Company’s business condition (financial or otherwise), operations, properties or prospects, or ability to repay the credit based on the lender’s judgement. As of June 25, 2016, the line of credit had a balance of $800,000, and additional borrowing capacity of $902,000. These matters raise substantial doubt as to the Company’s ability to continue as a going concern. To address these matters, the Company’s management has taken several actions to provide additional liquidity and reduce costs and expenses going forward. These actions are described in the following paragraphs. ● On June 20, 2016, the Company entered into an Asset Purchase Agreement with Astronics Test Systems Inc. (Astronics), (see Note 9, Sale of Product Lines). Upon signing, Astronics paid $850,000 for the intellectual property of the product line. Astronics also agreed to purchase approximately $500,000 of related materials inventory from the Company during July and August of 2016. Proceeds from the asset sale will be used for working capital and general corporate purposes. ● In July 2016, Microsource received a $1.9 million non-recurring engineering order associated with redesigning a component of its high performance YIG filter used on an aircraft platform. The Company expects to deliver the NRE services over the next twelve months. ● In June 2016, the Giga-tronics Division also received a $3.3 million order from the United States Navy for the Real-Time Threat Emulation Systems (“TEmS”) which the Company also expects to ship in the second half of fiscal 2017. In July 2016, the Giga-tronics Division also received a $542,000 from the United States Navy for the ASG hardware only platform. The Company expects to fulfill the order within the next few months. ● In April 2016, Microsource received a $4.5 million order for YIG RADAR filters for a fighter jet platform, representing a 50% year increase in the order size when comparing fiscal 2017 to fiscal 2016. We expect to ship this order throughout fiscal 2017. ● With the proceeds received to date from sales of Giga-tronics Switch, Power Meter, Amplifier, and Signal Generator legacy product lines the Company has been able to reduce its number of employees by approximately 20%, from 71 in November 2015 to 56 on July 31, 2016, while providing additional cash for operations from the proceeds of the sales. ● Giga-tronics plans to work with Bridge Bank to renew the line of credit prior to its May 7, 2017 expiration. ● In the first quarter of fiscal 2016, the Company’s Microsource business unit also finalized a multiyear $10.0 million YIG production order (“YIG Production Order”). The Company expects to start shipping the YIG Production Order in the second quarter of fiscal 2017. ● To assist with the upfront purchases of inventory required for future product deliveries, the Company entered into advance payment arrangements with certain customers, whereby the customers reimburse the Company for raw material purchases prior to the shipment of the finished products. In the first quarter of fiscal 2017, the Company entered into advance payment arrangements totaling $1.2 million. The Company will continue to seek similar terms in future agreements with these customers and other customers. Management will continue to review all aspects of the business in an effort to improve cash flow and reduce costs and expenses, while continuing to invest, to the extent possible, in new product development for future revenue streams. Management will also continue to seek additional working capital through debt, or equity financing, however there are no assurances that such financings will be available at all, or on terms acceptable to the Company. Cumulative losses have had a significant negative impact on the financial condition of the Company and raise substantial doubt about the Company’s ability to continue as a going concern. The Consolidated Financial Statements have been prepared assuming the Company will continue as a going concern and do not include any adjustments that might result if the Company were unable to do so. |
Note 3 - Revenue Recognition
Note 3 - Revenue Recognition | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Revenue Recognition Disclosure [Text Block] | (3) Revenue Recognition The Company records revenue when there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed and determinable, and collectability is reasonably assured. This occurs when products are shipped or the customer accepts title transfer. If the arrangement involves acceptance terms, the Company defers revenue until product acceptance is received. The Company limits the amount of revenue recognition for delivered elements to the amount that is not contingent on the future delivery of products or services, future performance obligations or subject to customer-specified return or refund privileges. The Company evaluates each deliverable in an arrangement to determine whether they represent separate units of accounting. On certain large development contracts, revenue is recognized upon achievement of substantive milestones. Determining whether a milestone is substantive is a matter of judgment and that assessment is performed only at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive: a. It is commensurate with either of the following: 1. The Company’s performance to achieve the milestone. 2. The enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the Company's performance to achieve the milestone. b. It relates solely to past performance. c. It is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement. Milestones for revenue recognition are agreed upon with the customer prior to the start of the contract and some milestones will be tied to product shipping while others will be tied to design review. In fiscal 2015 the Company’s Microsource business unit received a $6.5 million order from a major aerospace company for non-recurring engineering services to develop a variant of its high performance fast tuning YIG filters for an aircraft platform and to deliver a limited number of flight-qualified prototype hardware units (the “NRE Order”) which is being accounted for on a milestone basis. The Company considered factors such as estimated completion dates and product acceptance of the order prior to accounting for the NRE Order as milestone revenue. During the three month periods ended June 25, 2016 and June 27, 2015, revenue recognized on a milestone basis were $145,000 and $692,000, respectively. On certain contracts with several of the Company’s significant customers the Company receives payments in advance of manufacturing. Advanced payments are recorded as deferred revenue until the revenue recognition criteria described above have been met. Accounts receivable are stated at their net realizable value. The Company has estimated an allowance for uncollectable accounts based on analysis of specifically identified accounts, outstanding receivables, consideration of the age of those receivables, the Company’s historical collection experience, and adjustments for other factors management believes are necessary based on perceived credit risk. The Company provides for estimated costs that may be incurred for product warranties at the time of shipment. The Company’s warranty policy generally provides twelve to eighteen months depending on the customer. The estimated cost of warranty coverage is based on the Company’s actual historical experience with its current products or similar products. For new products, the required reserve is based on historical experience of similar products until such time as sufficient historical data has been collected on the new product. Adjustments are made as new information becomes available. |
Note 4 - Inventories
Note 4 - Inventories | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | (4 ) Inventories Inventories consisted of the following: (In thousands) June 25, 2016 March 26, 2016 Raw materials $ 3,635 $ 3,489 Work-in-progress 2,424 2,156 Finished goods 147 2 Demonstration inventory 41 47 Total $ 6,247 $ 5,694 |
Note 5 - Software Development C
Note 5 - Software Development Costs | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Research, Development, and Computer Software Disclosure [Text Block] | (5 ) Software Development Costs On September 3, 2015, the Company entered into a software development agreement with a major aerospace and defense company whereby the aerospace company would develop and license its simulation software to the Company. The simulation software (also called Open Loop Simulator or OLS technology) is currently the aerospace company’s intellectual property. The OLS technology generates threat simulations and enables various hardware to generate signals for performing threat analysis on systems under test. The Company intends to license the OLS software as a bundled or integrated solution with its Advanced Signal Generator system. The Company is obligated to pay the aerospace company software development costs and fees for OLS of $919,000 in the aggregate, which is payable in monthly installments as the work is performed by the aerospace company through July 2016. The OLS technology is a perpetual license agreement that may be terminated by the Company at any time as long as the Company provides a notice to the aerospace company and pays for the development costs incurred through the notice termination date. The Company is also obligated to pay royalties to the aerospace company on net sales of its Advanced Signal Generator product sold with the OLS software equal to a percentage of net sales price of each ASG system sold and subject to certain minimums. The Company expenses research and development costs as they are incurred. Development costs of computer software to be sold, leased, or otherwise marketed are subject to capitalization beginning when a product’s technological feasibility has been established and ending when a product is available for general release to customers. As of the first quarter ended June 25, 2016 capitalized software costs were $1.2 million. The Company intends to begin amortizing the costs of capitalized software to cost of sales once the product is released to its customers. The Company signed an amendment to the software development agreement in July of 2016 for additional features and functionality at an estimated cost of $265,000 that would be payable in monthly installments as the work is performed by the aerospace company through the fall of 2016. |
Note 6 - Accounts Receivable Li
Note 6 - Accounts Receivable Line of Credit | 3 Months Ended |
Jun. 25, 2016 | |
Bridge Bank [Member] | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | (6) Accounts Receivable Line of Credit On June 1, 2015 the Company entered into a $2.5 million Revolving Accounts Receivable Line of Credit agreement with Bridge Bank. The agreement provides for a maximum borrowing capacity of $2.5 million of which $2.0 million is subject to a borrowing base calculation and $500,000 is non-formula based. The loan is secured by all assets of the Company including intellectual property and general intangibles and provides for a borrowing capacity equal to 80% of eligible accounts receivable. The loan matures on May 7, 2017 and bears an interest rate, equal to 1.5% over the bank’s prime rate of interest (which was 3.5% at June 25, 2016 resulting in an interest rate of 5.0%). Interest is payable monthly with principal due upon maturity. The Company paid a commitment fee of $12,500, and an additional $12,500 which was due in May 2016. The loan agreement contains financial and non-financial covenants that are customary for this type of lending and includes a covenant to maintain an asset coverage ratio of at least 135% (defined as unrestricted cash and cash equivalents maintained with Bridge Bank, plus eligible accounts receivable aged less than 90 days from the invoice date, divided by the total amount of outstanding principal of all obligations under the loan agreement). As of June 25, 2016, the Company was in compliance with all the financial covenants under the agreement. The line of credit requires a lockbox arrangement, which provides for receipts to be swept daily to reduce borrowings outstanding at the discretion of Bridge Bank. This arrangement, combined with the existence of the subjective acceleration clause in the line of credit agreement, necessitates the line of credit be classified as a current liability on the balance sheet. The acceleration clause allows for amounts due under the facility to become immediately due in the event of a material adverse change in the Company’s business condition (financial or otherwise), operations, properties or prospects, or ability to repay the credit based on the lender's judgment. As of June 25, 2016, the Company’s total outstanding borrowings and remaining borrowing capacity under the Bridge Bank line of credit were $800,000 and $902,000, respectively. |
Note 7 - Term Loan, Revolving L
Note 7 - Term Loan, Revolving Line of Credit and Warrants | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Long-term Debt [Text Block] | ( 7 ) Term Loan, Revolving Line of Credit and Warrants On March 13, 2014 the Company entered into a three year, $2.0 million term loan agreement with PFG (Partners For Growth IV, L.P.) under which the Company received $1.0 million on March 14, 2014 (“First Draw”). Pursuant to the agreement, the Company had the ability to borrow an additional $1.0 million following the Company’s achievement of certain performance milestones which included achieving $7.5 million in net sales during the first half of fiscal 2015 and two consecutive quarters of net income greater than zero during fiscal 2015. On June 16, 2014, the Company amended its loan agreement with PFG (the “Amendment”). Under the terms of the Amendment, PFG made a revolving credit line available to Giga-tronics in the amount of $500,000, and the Company borrowed the entire amount on June 17, 2014. The revolving line had a thirty-three month term. The Amendment reduced the future amount potentially available for the Company to borrow under the PFG Loan agreement from $1.0 million to $500,000. The interest on the PFG revolving credit line was fixed, calculated on a daily basis at a rate of 12.50% per annum. The Company was allowed to prepay the loan at any time prior to its March 13, 2017 maturity date without a penalty. On June 3, 2015, the Company further amended its loan agreement with PFG (the “Second Amendment”). The Second Amendment cancelled the Company’s $500,000 of borrowing availability under the June 2014 Amendment and required the Company to pay PFG $150,000 towards its existing $500,000 outstanding balance under the revolving line of credit, which the Company paid in July 2015. The Company also agreed to pay PFG an additional $10,000 per month towards its remaining credit line balance until repaid, followed by like payments towards its term loan balance until repaid. The $500,000 borrowed with the June 2014 Amendment was fully repaid in March 2016. Interest on the initial $1.0 million term loan is fixed at 9.75% and required monthly interest only payments during the first six months of the agreement followed by monthly principal and interest payments over the remaining thirty months. The Company may prepay the loan at any time prior to maturity by paying all future scheduled principal and interest payments. As of June 25, 2016, the Company’s total outstanding debt associated with the initial PFG loan was $270,000. The PFG Loan is secured by all of the assets of the Company under a lien that is junior to the Bridge Bank debt described in Note 6, and limits borrowing under the Bridge Bank credit line limit to $2.5 million. The Company paid a loan fee of $30,000 upon the initial draw, the loan fees paid are recorded as a direct reduction from the carrying amount of the debt liability and amortized to interest expense over the remaining term of the PFG loan agreement. The loan agreement contains financial covenants associated with the Company achieving minimum quarterly net sales and maintaining a minimum monthly shareholders’ equity. In the event of default by the Company, all or any part of the Company’s obligation to PFG could become immediately due. As of June 25, 2016, the Company was in compliance with all the financial covenants under the agreement. The loan agreement also initially provided for the issuance of warrants convertible into 300,000 shares of the Company’s common stock, of which 180,000 were exercisable upon receipt of the initial $1.0 million from the First Draw, 80,000 became exercisable with the First Amendment and 40,000 were cancelled as a result of the Second Amendment. Each warrant issued under the loan agreement has a term of five years and an exercise price of $1.42 which was equal to the average NASDAQ closing price of the Company’s common stock for the ten trading days prior to the First Draw. If the warrants are not exercised before expiration on March 13, 2019, the Company would be required to pay PFG $150,000 and $67,000 as settlement for warrants associated with the First Draw and the Amendment, respectively. The warrants could be settled for cash at an earlier date in the event of any acquisition or other change in control of the Company, future public issuance of Company securities or liquidation (or substantially similar event) of the Company. The Company currently has no definitive plans for any of the aforementioned events, and as a result, the cash payment date is estimated to be the expiration date unless warrants are exercised before then. The warrants have the characteristics of both debt and equity and are accounted for as a derivative liability measured at fair value each reporting period with the change in fair value recorded in earnings. The initial fair value of the warrants associated with the First Draw and Amendment were $173,000 and $168,000, respectively. As of June 25, 2016, the estimated fair values of the derivative liabilities associated with the warrants issued in connection with the First Draw and Amendment were $184,000 and $123,000, respectively, for a combined value of $307,000. As of March 26, 2016, the estimated fair value of the derivative liability associated with the warrant issued in connection with the First Draw and Amendment was $212,000 and $141,000, respectively for a combined value of $353,000. The change in the fair value of the warrant liability totaled $46,000 for the first quarter ended June 25, 2016 and is reported in the accompanying statement of operations as a gain on adjustment of derivative liability to fair value. The change in the fair value of the warrant liability totaled $63,000 for the first quarter ended June 27, 2015 and is reported in the accompanying statement of operations as a loss on adjustment of derivative liability to fair value. The initial $1.0 million in proceeds under the term loan agreement were allocated between the PFG Loan and the warrants based on their relative fair values on the date of issuance which resulted in initial carrying values of $822,000 and $178,000, respectively. The resulting discount of $178,000 on the PFG Loan is being accreted to interest expense under the effective interest method over the three-year term of the PFG Loan. For the quarter ended June 25, 2016 and June 27, 2015, the Company recorded accretion of discount expense associated with the warrants issued with the PFG Loan of $11,000 and $42,000, respectively. |
Note 8 - Fair Value
Note 8 - Fair Value | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | ( 8 ) Fair Value Pursuant to the accounting guidance for fair value measurement and its subsequent updates, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date. The accounting guidance establishes a hierarchy for inputs used in measuring fair value that minimizes the use of unobservable inputs by requiring the use of observable market data when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on active market data. Unobservable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances. The fair value hierarchy is broken down into the three input levels summarized below: • Level 1 • Level 2 • Level 3 The carrying amounts of the Company’s cash and cash-equivalents and line of credit approximate their fair values at each balance sheet date due to the short-term maturity of these financial instruments, and generally result in inputs categorized as Level 1 within the fair value hierarchy. The fair values of term debt are based on the present value of expected future cash flows and assumptions about current interest rates and the creditworthiness of the Company, and generally result in inputs categorized as Level 3 within the fair value hierarchy. At June 25, 2016 and March 26, 2016, the carrying amounts of the Company’s term debt totaled $254,000 and $370,000, respectively and the estimated fair value totaled $268,000 and $393,000, respectively. The fair value was calculated using a discounted cash flow model and utilized a 20% discount rate. The rates are commensurate with market rates given the remaining term, principal repayment schedule, the Company’s creditworthiness and outstanding loan balance. The Company’s derivative warrant liability is measured at fair value on a recurring basis and is categorized as Level 3 in the fair value hierarchy. The derivative warrant liability is valued using a Monte Carlo simulation model, which used the following assumptions as of June 25, 2016: (i) the remaining expected life of 2.8 years, (ii) the Company’s historical volatility rate of 117.8%, (iii) risk-free interest rate of 0.73%, and (iv) a discount rate of twenty percent. The aforementioned derivative warrant liability is the Company’s only asset and liability recognized and measured at fair value on a recurring or non-recurring basis and was follows: Fair Value Measurements as of June 25 , 2016 (In Thousands) : Level 1 Level 2 Level 3 Warrant Liability $ — $ — $ 307 Total $ — $ — $ 307 Fair Value Measurements as of March 2 6 , 201 6 ( In Thousands): Level 1 Level 2 Level 3 Warrant Liability $ — $ — $ 353 Total $ — $ — $ 353 There were no transfers between Level 1, Level 2 or Level 3 for the quarter ended June 25, 2016. The table below summarizes changes in gains and losses recorded in earnings for Level 3 assets and liabilities that are still held at June 25, 2016: Quarter Ended Quarter Ended (In thousands) June 25 , 2016 June 27 , 2015 Warrant liability at beginning of year $ 353 $ 252 Gains on adjustment of warrant liability to fair value (46 ) — Losses on adjustment of warrant liability to fair value — 63 Warrant liability at end of period $ 307 $ 315 There were no assets measured at fair value on a recurring basis and there were no assets or liabilities measured on a non-recurring basis at June 25, 2016 and March 26, 2016. The following table presents quantitative information about recurring Level 3 fair value measurements at June 25, 2015 and March 26, 2016: June 2 5 , 2016 Valuation Technique(s) Unobservable Input Warrant liability Monte Carlo Discount rate 20 % March 2 6 , 201 6 Valuation Techniques(s) Unobservable Input Warrant liability Monte Carlo Discount rate 20 % The discount rate of twenty percent is management’s estimate of the cost of capital given the Company’s credit worthiness. A significant increase in the discount rate would significantly decrease the fair value, but the magnitude of this decrease would be less significant in a scenario where the Company’s stock price is significantly higher than the exercise price since the holder’s option to take a cash payment at maturity represents a smaller component of the total fair value when the Company’s stock price is higher. The Monte Carlo simulation model simulated the Company’s stock price through the maturity date of March 31, 2019. At the end of the simulated period, the value of the warrant was determined based on the greater of (1) the net share settlement value, (2) the net exercise value, or (3) the fixed cash put value. |
Note 9 - Sale of Product Lines
Note 9 - Sale of Product Lines | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | ( 9 ) Sale of Product Lines On June 20, 2016, the Company entered into an Asset Purchase Agreement for the sale of its Switch product line to Astronics Test Systems Inc. (Astronics). Upon signing the agreement, Astronics paid $850,000 for the intellectual property of the product line. The Company recognized a net gain of $802,000 in the quarter ending June 25, 2016 after related expenses were subtracted from the sales price. The following table presents the breakdown of the gain recognized in the quarter related to the asset sale: (In thousands) Quarter Ended June 25, 2016 Cash received from Astronics $ 850 Cash paid to buy out future commission obligation (170 ) Employee severance (97 ) Legal fees (13 ) Commissions (46 ) Warranty Liability released 278 Net gain recognized in the quarter $ 802 In calculating the gain included in the accompanying consolidated financial statements, the Company released $278,000 of deferred warranty obligations related to the Switch asset. Pursuant to the terms of the agreement, Astronics assumed all the warranty obligations for the Switch product line, including the products sold prior to the asset being transferred to Astronics. The deferred warranty obligation was previously included in other current liabilities in the consolidated financial statements. The Company also had a previous agreement with a consultant supporting the Switch product line, which included a three percent commission on the sales of the Switch product line for a period of 4 years ending in January 2020. The agreement allowed for a buyout of future commissions associated with the Switch product, which the Company exercised in connection with the Astronics sales in June 2016 which resulted in a payment by the Company during June of $170,000. Astronics also agreed to purchase approximately $500,000 of related materials inventory from Giga-tronics between July and August of 2016. The Switch product line accounted for $1.1 million in revenue for the fiscal quarter ended June 25, 2016 and $489,000 for the fiscal quarter June 27, 2015. The Switch product line’s gross margin on these revenues was $437,000 for the fiscal quarter ended June 25, 2016 and $217,000 for the fiscal quarter June 27, 2015. While the Company is able to distinguish revenue and gross margin information related to the sale of the Switch product line, the company is unable to present meaningful information about results of operation and cash flows from the Switch product line. On December 15, 2015, the Company entered into an Asset Purchase Agreement with Spanawave, whereby Spanawave agreed to purchase the Giga-tronics’ Division product lines for its Power Meters, Amplifiers and Legacy Signal Generators for $1.5 million. The agreement provided for the transfer of these product lines to Spanawave sequentially in six phases beginning with certain sensor and amplifier products. The final product line transfer (legacy Signal Generators) is currently estimated to be completed by December 2016. As of June 25, 2016, the Company had received $750,000 from Spanawave under the agreement (of which $375,000 was received during the quarter ended June 25, 2016), which is included in deferred liability related to asset sale in the consolidated balance sheet. In addition, the Company received approximately $275,000 in exchange for raw materials as of June 25, 2016. The purchase price of the raw materials approximated its carrying value, therefore no gain or loss was recognized. After the end of the reporting period, the Company and Spanawave have been engaged in a dispute as to whether the Company has fulfilled all the requirements to close phases one through five and become entitled to the $375,000 received during the first quarter of fiscal 2017. The parties are currently attempting to resolve this dispute. On July 28, 2016, as part of its effort to resolve the dispute, the Company returned the $375,000 received during the quarter to Spanawave. No gain has been recognized in connection with this product line sale as the Company had not fully completed the asset transfer as required by the provisions of the agreement and final acceptance by Spanawave was pending. The final installment of $1.1 million is expected to be paid in fiscal 2017. In addition, the Company will sell to Spanawave approximately $350,000 of existing inventory for the remaining phase. The Company has stopped manufacturing these product lines. These product lines accounted for $275,000 in revenue for the fiscal quarter ended June 25, 2016 and $780,000 for the fiscal quarter June 27, 2015.Gross margin on these revenue was zero for the fiscal quarter ended June 25, 2016 and $240,000 for the fiscal quarter June 27, 2015. While the Company is able to distinguish revenue and gross margin information related to the sale of these product lines, the company is unable to present meaningful information about results of operation and cash flows from these product lines. |
Note 10- Loss Per Share
Note 10- Loss Per Share | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | (10 ) Loss Per Share Basic loss per share (EPS) is calculated by dividing net income or loss by the weighted average common shares outstanding during the period. Diluted EPS reflects the net incremental shares that would be issued if unvested restricted shares became vested and dilutive outstanding stock options were exercised, using the treasury stock method. In the case of a net loss, it is assumed that no incremental shares would be issued because they would be antidilutive. In addition, certain options are considered antidilutive because assumed proceeds from exercise price, related tax benefits and average future compensation was greater than the weighted average number of options outstanding multiplied by the average market price during the period. The shares used in per share computations are as follows: Three Months Ended (In thousands except per share data) June 25, 2016 June 27, 2015 Net loss $ (102 ) $ (629 ) Weighted average: Common shares outstanding 9,550 6251 Potential common shares — — Common shares assuming dilution 9,550 6251 Loss per common share – basic $ (0.01 ) $ (0.10 ) Loss per common share – diluted $ (0.01 ) $ (0.10 ) Stock options not included in computation that could potentially dilute EPS in the future 1,529 1,623 Restricted stock awards not included in computation that could potentially dilute EPS in the future — 432 Convertible preferred stock not included in computation that could potentially dilute EPS in the future 1,853 1,853 Warrants not included in computation that could potentially dilute EPS in the future 3,737 1,353 The stock options, restricted stock, convertible preferred stocks and warrants not included in the computation of diluted earnings per share (EPS) for the three month period ended June 25, 2016 and June 27, 2015 is a result of the Company’s net loss and, therefore, the effect of these instruments would be anti-dilutive. |
Note 11 - Share-based Compensat
Note 11 - Share-based Compensation | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | (11) Share Based Compensation The Company has established the 2005 Equity Incentive Plan, which provide for the granting of options and restricted stock for up to 2,850,000 shares of common stock at 100% of fair market value at the date of grant, with each grant requiring approval by the Board of Directors of the Company. The 2005 Plan has been extended to be effective until 2025. Option grants under the 2000 Stock Option Plan are no longer available. Options granted generally vest in one or more installments in a four or five year period and must be exercised while the grantee is employed by the Company or within a certain period after termination of employment. Options granted to employees shall not have terms in excess of 10 years from the grant date. Holders of options may be granted stock appreciation rights (SARs), which entitle them to surrender outstanding awards for a cash distribution under certain changes in ownership of the Company, as defined in the stock option plan. As of June 25, 2016, no SAR’s have been granted under the option plan. As of June 25, 2016, the total number of shares of common stock available for issuance was 1,018,627. All outstanding options have a ten year life from the date of grant. The Company records compensation cost associated with share-based compensation equivalent to the estimated fair value of the awards over the requisite service period. Stock Options In calculating compensation related to stock option grants, the fair value of each stock option is estimated on the date of grant using the Black-Scholes-Merton option-pricing model and the following weighted average assumptions: Three Months Ended June 2 5 , 201 6 June 2 7 , 201 5 Dividend yield — — Expected volatility 98.95 % — Risk-free interest rate 1.38 % — Expected term (years) 8.36 — The computation of expected volatility used in the Black-Scholes-Merton option-pricing model is based on the historical volatility of the Company’s share price. The expected term is estimated based on a review of historical employee exercise behavior with respect to option grants. The risk-free interest rate is based on the U.S. Treasury rates with maturity similar to the expected term of the option on the date of grant. A summary of the changes in stock options outstanding for the three month period ended June 25, 2016 and the year ended March 26, 2016 is as follows: Weighted Average Weighted Average Remaining Contractual Aggregate Intrinsic Shares Exercise Price Terms (Years) Value Outstanding at March 28, 2015 1,726,975 $ 1.57 6.9 $ 219 Granted 35,000 1.22 Exercised 48,550 1.59 Forfeited / Expired 121,225 2.15 Outstanding at March 26, 2016 1,592,200 $ 1.52 6.8 $ 69 Granted 50,000 1.26 Exercised — — Forfeited / Expired 113,200 1.73 Outstanding at June 25, 2016 1,529,000 $ 1.49 6.7 $ 5 Exercisable at June 25, 2016 997,000 $ 1.46 6.2 $ 5 At June 25, 2016 expected to vest in the future 423,054 $ 1.53 7.3 $ — As of June 25, 2016, there was $376,000 of total unrecognized compensation cost related to non-vested options. That cost is expected to be recognized over a weighted average period of 2.59 years and will be adjusted for subsequent changes in estimated forfeitures. There were 28,500 options that vested during the quarter ended June 25, 2016, and 38,500 options that vested during the quarter ended June 27, 2015. The total fair value of options vested during each of the quarters ended June 25, 2016 and June 27, 2015 was $1,000 and $13,000 respectively. There were no options exercised in the three month period ended June 25, 2016. Options for 12,500 shares of common stock were exercised in the three month period ended June 27, 2015. Share based compensation cost related to stock options recognized in operating results for the three months ended June 25, 2016 and June 27, 2015 totaled $72,000 and $114,000, respectively. Restricted Stock No restricted awards were granted during the first quarter of fiscal 2017 and fiscal 2016. No restricted awards vested during the first quarter of fiscal 2017. The Company granted 50,000 shares of restricted stock outside the 2005 Plan in fiscal 2013 that vested in the first quarter of fiscal 2016. The restricted stock awards are considered fixed awards as the number of shares and fair value at the grant date is amortized over the requisite service period net of estimated forfeitures. There was no compensation recognized for the restricted and unrestricted stock awards during the first quarter of fiscal 2017. Compensation cost recognized for the restricted and unrestricted stock awards during the first quarter of 2016 was $221,000. A summary of the changes in non-vested restricted stock awards outstanding for the three month period ended June 25, 2016 and the fiscal year ended March 26, 2016 is as follows: Shares Weighted Average Fair Value Non-vested at March 28, 2015 482,000 $ 2.02 Granted — Vested 482,000 2.02 Forfeited or cancelled — — Non-Vested at March 26, 2016 — $ — Granted — — Vested — Forfeited or cancelled — — Non-Vested at June 25, 2016 — $ — |
Note 12 - Significant Customers
Note 12 - Significant Customers and Industry Segment Information | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | ( 12 ) Significant Customer and Industry Segment Information The Company has two reportable segments: Giga-tronics Division and Microsource. ● The Giga-tronics Division historically produces a broad l ine of test and measurement equipment used primarily for the design, production, repair and maintenance of products in aerospace, telecommunications, RADAR, and electronic warfare. ● Microsource primarily develops and manufactures YIG RADAR filters used in fighter jet aircraft for two prime contractors. The tables below present information for the three month periods ended June 25, 2016 and June 27, 2015: Three Month Periods Ended Three Month Periods Ended (In thousands) At June 25, 2016 June 25, 2016 At June 27, 2015 June 27, 2015 Assets Net Sales Net Income Assets Net Sales Net Income Giga-tronics Division $ 8,233 $ 2,125 $ (554) $ 6,438 $ 2,117 $ (1,645 ) Microsource 3,887 1,317 452 2,053 2,258 1,016 Total $ 12,120 $ 3,442 $ (102) $ 8,491 $ 4,375 $ (629 ) During the first quarter of fiscal 2017, one customer accounted for 30% of the Company’s consolidated revenues and was included in the Microsource segment. A second customer accounted for 22% and was included in the Giga-tronics Division. A third customer accounted for 17% of the Company’s consolidated revenue and was also included in the Giga-tronics Division. During the first quarter of fiscal 2016, one customer accounted for 31% of the Company’s consolidated revenues and was included in the Microsource segment. A second customer accounted for 16% and was also included in the Microsource segment. A third customer accounted for 13% of the Company’s consolidated revenue and was included in the Giga-tronics Division. |
Note 13 - Income Taxes
Note 13 - Income Taxes | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | (13) Income Taxes The Company accounts for income taxes using the asset and liability method as codified in Topic 740. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. The Company recorded no tax expense for the three months ended June 25, 2016 and June 27, 2015. The effective tax rate for the three months ended June 25, 2016 and June 27, 2015 was 0% respectively, primarily due to a valuation allowance recorded against the net deferred tax asset balance. As of June 25, 2016, the Company had recorded $106,000 for unrecognized tax benefits related to uncertain tax positions. The unrecognized tax benefit is netted against the non-current deferred tax asset on the Consolidated Balance Sheet. The Company does not expect the liability for unrecognized tax benefits to change materially within the next 12 months. The Company does have a California Franchise Tax Board audit that is currently in process. The Company is working with the California Franchise Tax Board to resolve all audit issues and does not believe any material taxes, penalties and fees are due. However, as a result of the on-going examination, the Company recorded an estimated associated tax liability of $45,000 in the first quarter of fiscal 2015. |
Note 14 - Warranty Obligations
Note 14 - Warranty Obligations | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Product Warranty Disclosure [Text Block] | ( 14 ) Warranty Obligations The Company records a liability in cost of sales for estimated warranty obligations at the date products are sold. Adjustments are made as new information becomes available. The following provides a reconciliation of changes in the Company’s warranty reserve. The Company provides no other guarantees. (In thousands) Three Months Ended June 25, 2016 Three Months Ended June 27, 2015 Balance at beginning of period $ 60 $ 76 Provision, net 112 17 Warranty costs incurred (112 ) (18 ) Balance at end of period $ 60 $ 75 |
Note 15 - Series B, C, D Conver
Note 15 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Preferred Stock [Text Block] | (15) Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants On November 10, 2011, the Company received $2,199,000 in cash proceeds from Alara Capital AVI II, LLC, a Delaware limited liability company (the “Investor”), an investment vehicle sponsored by Active Value Investors, LLC, under a Securities Purchase Agreement entered into on October 31, 2011. Under the terms of the Securities Purchase Agreement, the Company issued 9,997 shares of its Series B Convertible Voting Perpetual Preferred Stock (“Series B Preferred Stock”) to the Investor at a price of $220 per share. The Company has recorded $2.0 million as Series B Preferred Stock on the consolidated balance sheet which is net of stock offering costs of approximately $202,000 and represents the value attributable to both the convertible preferred stock and warrants issued to the Investor. After considering the value of the warrants, the effective conversion price of the preferred stock was greater than the common stock price on date of issue and therefore no beneficial conversion feature was present. On February 19, 2013, the Company entered into a Securities Purchase Agreement pursuant to which it agreed to sell 3,424.65 shares of its Series C Convertible Voting Perpetual Preferred Stock (“Series C Preferred Stock”) to the Investor, for aggregate consideration of $500,000, which is approximately $146.00 per share. The Company has recorded $457,000 as Series C Preferred Stock on the consolidated balance sheet, which is net of stock offering costs of approximately $43,000. After considering the reduction in the value of the warrant, the effective conversion price of the preferred stock was greater than the common stock price on the date of issue and therefore no beneficial conversion feature was present. On July 8, 2013 the Company received $817,000 in net cash proceeds from the Investor under a Securities Purchase Agreement. The Company sold to the Investor 5,111.86 shares of its Series D Convertible Voting Perpetual Preferred Stock (Series D Preferred Stock) and a warrant to purchase up to 511,186 additional shares of common stock at the price of $1.43 per share. The allocation of the $858,000 in gross proceeds from issuance of Series D Preferred Stock based on the relative fair values resulted in an allocation of $498,000 (which was recorded net of $41,000 of issuance costs) to Series D Preferred Stock and $360,000 to Common Stock. In addition, because the effective conversion rate based on the $498,000 allocated to Series D Preferred Stock was $0.97 per common share which was less than the Company’s stock price on the date of issuance, a beneficial conversion feature was present at the issuance date. The beneficial conversion feature totaled $238,000 and was recorded as an increase of common stock and an increase to accumulated deficit. Each share of Series B, Series C and Series D Preferred Stock is convertible into one hundred shares of the Company’s common stock. The investor also held warrants to purchase 1,017,405 shares at an exercise price of $1.43 per share which were exercised in February and May 2015 as discussed in Note 17, Exercise of Series C and Series D Warrants. The table below presents information as of June 25, 2016 and March 26, 2016. Preferred Stock As of June 25, 2016 and March 26, 2016 Liquidation Designated Shares Shares Issued Shares Outstanding Preference (in thousands) Series B 10,000.00 9,997.00 9,997.00 $ 2,309 Series C 3,500.00 3,424.65 3,424.65 500 Series D 6,000.00 5,111.86 5,111.86 731 Total 19,500.00 18,533.51 18,533.51 $ 3,540 |
Note 16 - Private Placement Off
Note 16 - Private Placement Offering | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Private Placement Offering [Text Block] | ( 1 6) Private Placement Offering On January 19, 2016, the Company entered into a Securities Purchase Agreement for the sale of 2,787,872 Units, each consisting of one share of common stock and a warrant to purchase 0.75 shares of common stock, to approximately 20 private investors. The purchase price for each Unit was $1.24375. Gross proceeds were approximately $3.5 million. Net proceeds to the Company after fees was approximately $3.1 million. The portion of the purchase price attributable to the common shares included in each Unit was $1.15, the consolidated closing bid price for the Company’s common stock on January 15, 2016. The warrant price was $.09375 per Unit (equivalent to $0.125 per whole warrant share), with an exercise price of $1.15 per share. The term of the warrants is five years from the date of completion of the transaction. Emerging Growth Equities, Ltd also received warrants to purchase 292,727 shares of common stock at an exercise price of $1.15 per share as part of its consideration for serving as placement agent in connection with the private placement. |
Note 17 - Exercise of Series C
Note 17 - Exercise of Series C and Series D Warrants | 3 Months Ended |
Jun. 25, 2016 | |
Notes to Financial Statements | |
Warrants [Text Block] | ( 1 7) Exercise of Series C and Series D Warrants On February 16, 2015, the Company entered into a Securities Purchase Agreement and Warrant Agreement with Alara Capital AVI II, LLC in which the Company received total gross cash proceeds of approximately $1.5 million. Funds were received from Alara in separate closings dated February 16, 2015 and February 23, 2015 in which Alara exercised a total of 1,002,818 of its existing Series C and Series D warrants to purchase common shares, all of which had an exercise price of $1.43 per share for total cash proceeds of $1,434,000, which was recorded net of $42,000 of stock issuance costs. As part of the consideration for this exercise, the Company sold to Alara two new warrants (“new Warrants”) to purchase an additional 898,634 and 194,437 common shares at an exercise price of $1.78 and $1.76 per share, respectively, for a total purchase price of $137,000 or $0.125 per share, The new warrants have a term of five years and may be paid in cash or through a cashless net share settlement. The Company and Alara amended the remaining 14,587 warrants as part of the February closings. On May 14, 2015, Alara exercised the remaining 14,587 warrants by acquiring 7,216 of shares of the Company’s common stock through a cashless net share settlement. The Company recorded the issuance of the new Warrants using their estimated fair value on the date of issuance. The Company estimated the fair value of the new Warrants using the Black-Scholes option valuation model with the following assumptions: expected term of 5 years, a risk-free interest rate of 1.54%, expected volatility of 90% and 0% expected dividend yield. The resulting $1.2 million from the issuance of the new Warrants was recorded as a charge to other expense in the fourth quarter of fiscal 2015. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 3 Months Ended |
Jun. 25, 2016 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation |
Reclassification, Policy [Policy Text Block] | Reclassifications |
Derivatives, Policy [Policy Text Block] | Derivatives |
Product Development Costs, Policy [Policy Text Block] | Software Development Costs |
Discontinued Operations, Policy [Policy Text Block] | Discontinued Operations (see Note 9, Sale of Product Lines) concluding that each product line does not meet the definition of a “component of an entity” as defined by ASC 205-20.The Company is able to distinguish revenue and gross margin information as disclosed in Note 9, Sale of Product Lines to the accompanying financial statements however, operations and cash flow information is not clearly distinguishable and the company is unable to present meaningful information about results of operations and cash flows from those product lines. |
New Accounting Pronouncements, Policy [Policy Text Block] | New Accounting Standards Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing Revenue from Contracts with Customers (Topic 606) |
Note 4 - Inventories (Tables)
Note 4 - Inventories (Tables) | 3 Months Ended |
Jun. 25, 2016 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | (In thousands) June 25, 2016 March 26, 2016 Raw materials $ 3,635 $ 3,489 Work-in-progress 2,424 2,156 Finished goods 147 2 Demonstration inventory 41 47 Total $ 6,247 $ 5,694 |
Note 8 - Fair Value (Tables)
Note 8 - Fair Value (Tables) | 3 Months Ended |
Jun. 25, 2016 | |
Notes Tables | |
Fair Value, Liabilities Measured on Recurring Basis [Table Text Block] | Fair Value Measurements as of June 25 , 2016 (In Thousands) : Level 1 Level 2 Level 3 Warrant Liability $ — $ — $ 307 Total $ — $ — $ 307 Fair Value Measurements as of March 2 6 , 201 6 ( In Thousands): Level 1 Level 2 Level 3 Warrant Liability $ — $ — $ 353 Total $ — $ — $ 353 |
Fair Value, Measured on Recurring Basis, Gain (Loss) Included in Earnings [Table Text Block] | Quarter Ended Quarter Ended (In thousands) June 25 , 2016 June 27 , 2015 Warrant liability at beginning of year $ 353 $ 252 Gains on adjustment of warrant liability to fair value (46 ) — Losses on adjustment of warrant liability to fair value — 63 Warrant liability at end of period $ 307 $ 315 |
Fair Value Inputs, Liabilities, Quantitative Information [Table Text Block] | June 2 5 , 2016 Valuation Technique(s) Unobservable Input Warrant liability Monte Carlo Discount rate 20 % March 2 6 , 201 6 Valuation Techniques(s) Unobservable Input Warrant liability Monte Carlo Discount rate 20 % |
Note 9 - Sale of Product Lines
Note 9 - Sale of Product Lines (Tables) | 3 Months Ended |
Jun. 25, 2016 | |
Notes Tables | |
Asset Purchase Agreement [Table Text Block] | (In thousands) Quarter Ended June 25, 2016 Cash received from Astronics $ 850 Cash paid to buy out future commission obligation (170 ) Employee severance (97 ) Legal fees (13 ) Commissions (46 ) Warranty Liability released 278 Net gain recognized in the quarter $ 802 |
Note 10- Loss Per Share (Tables
Note 10- Loss Per Share (Tables) | 3 Months Ended |
Jun. 25, 2016 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three Months Ended (In thousands except per share data) June 25, 2016 June 27, 2015 Net loss $ (102 ) $ (629 ) Weighted average: Common shares outstanding 9,550 6251 Potential common shares — — Common shares assuming dilution 9,550 6251 Loss per common share – basic $ (0.01 ) $ (0.10 ) Loss per common share – diluted $ (0.01 ) $ (0.10 ) Stock options not included in computation that could potentially dilute EPS in the future 1,529 1,623 Restricted stock awards not included in computation that could potentially dilute EPS in the future — 432 Convertible preferred stock not included in computation that could potentially dilute EPS in the future 1,853 1,853 Warrants not included in computation that could potentially dilute EPS in the future 3,737 1,353 |
Note 11 - Share-based Compens28
Note 11 - Share-based Compensation (Tables) | 3 Months Ended |
Jun. 25, 2016 | |
Notes Tables | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | Three Months Ended June 2 5 , 201 6 June 2 7 , 201 5 Dividend yield — — Expected volatility 98.95 % — Risk-free interest rate 1.38 % — Expected term (years) 8.36 — |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | Weighted Average Weighted Average Remaining Contractual Aggregate Intrinsic Shares Exercise Price Terms (Years) Value Outstanding at March 28, 2015 1,726,975 $ 1.57 6.9 $ 219 Granted 35,000 1.22 Exercised 48,550 1.59 Forfeited / Expired 121,225 2.15 Outstanding at March 26, 2016 1,592,200 $ 1.52 6.8 $ 69 Granted 50,000 1.26 Exercised — — Forfeited / Expired 113,200 1.73 Outstanding at June 25, 2016 1,529,000 $ 1.49 6.7 $ 5 Exercisable at June 25, 2016 997,000 $ 1.46 6.2 $ 5 At June 25, 2016 expected to vest in the future 423,054 $ 1.53 7.3 $ — |
Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block] | Shares Weighted Average Fair Value Non-vested at March 28, 2015 482,000 $ 2.02 Granted — Vested 482,000 2.02 Forfeited or cancelled — — Non-Vested at March 26, 2016 — $ — Granted — — Vested — Forfeited or cancelled — — Non-Vested at June 25, 2016 — $ — |
Note 12 - Significant Custome29
Note 12 - Significant Customers and Industry Segment Information (Tables) | 3 Months Ended |
Jun. 25, 2016 | |
Notes Tables | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Three Month Periods Ended Three Month Periods Ended (In thousands) At June 25, 2016 June 25, 2016 At June 27, 2015 June 27, 2015 Assets Net Sales Net Income Assets Net Sales Net Income Giga-tronics Division $ 8,233 $ 2,125 $ (554) $ 6,438 $ 2,117 $ (1,645 ) Microsource 3,887 1,317 452 2,053 2,258 1,016 Total $ 12,120 $ 3,442 $ (102) $ 8,491 $ 4,375 $ (629 ) |
Note 14 - Warranty Obligations
Note 14 - Warranty Obligations (Tables) | 3 Months Ended |
Jun. 25, 2016 | |
Notes Tables | |
Schedule of Product Warranty Liability [Table Text Block] | (In thousands) Three Months Ended June 25, 2016 Three Months Ended June 27, 2015 Balance at beginning of period $ 60 $ 76 Provision, net 112 17 Warranty costs incurred (112 ) (18 ) Balance at end of period $ 60 $ 75 |
Note 15 - Series B, C, D Conv31
Note 15 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Tables) | 3 Months Ended |
Jun. 25, 2016 | |
Notes Tables | |
Schedule of Stock by Class [Table Text Block] | Liquidation Designated Shares Shares Issued Shares Outstanding Preference (in thousands) Series B 10,000.00 9,997.00 9,997.00 $ 2,309 Series C 3,500.00 3,424.65 3,424.65 500 Series D 6,000.00 5,111.86 5,111.86 731 Total 19,500.00 18,533.51 18,533.51 $ 3,540 |
Note 2 - Going Concern and Ma32
Note 2 - Going Concern and Management's Plan (Details Textual) | Jun. 20, 2016USD ($) | Apr. 30, 2016USD ($) | Aug. 31, 2016USD ($) | Jun. 25, 2016USD ($) | Jun. 27, 2015USD ($) | Jun. 25, 2015USD ($) | Jul. 31, 2016USD ($) | Mar. 26, 2016USD ($) | Nov. 30, 2015 | Mar. 28, 2015USD ($) |
Bridge Bank [Member] | ||||||||||
Line of Credit, Current | $ 800,000 | |||||||||
Astronics Test Systems Inc [Member] | Switch Product Line [Member] | ||||||||||
Proceeds from Sales of Business, Affiliate and Productive Assets | $ 850,000 | 850,000 | ||||||||
Astronics Test Systems Inc [Member] | Scenario, Forecast [Member] | ||||||||||
Proceeds from sale of Inventory | $ 500,000 | |||||||||
Astronics Test Systems Inc [Member] | ||||||||||
Proceeds from sale of Inventory | 275,000 | |||||||||
YIG Production Order [Member] | Microsource [Member] | Subsequent Event [Member] | ||||||||||
Unbilled Receivables, Not Billable, Amount Expected to be Collected in Next Twelve Months | $ 1,900,000 | |||||||||
YIG Production Order [Member] | Microsource [Member] | ||||||||||
Unbilled Receivables, Not Billable, Amount Expected to be Collected in Next Twelve Months | $ 4,500,000 | |||||||||
Unbilled Receivables, Not Billable, Amount Expected to be Collected in Remainder of Fiscal Year | $ 10,000,000 | |||||||||
Real-Time TEmS [Member] | Gigatronics Division [Member] | ||||||||||
Unbilled Receivables, Not Billable, Amount Expected to be Collected in Remainder of Fiscal Year | 3,300,000 | |||||||||
ASG Hardware Only Platform [Member] | Gigatronics Division [Member] | Subsequent Event [Member] | ||||||||||
Unbilled Receivables, Not Billable, Amount Expected to be Collected in Remainder of Fiscal Year | $ 542,000 | |||||||||
Microsource [Member] | ||||||||||
Net Income (Loss) Attributable to Parent | 452,000 | $ 1,016,000 | ||||||||
Gigatronics Division [Member] | ||||||||||
Net Income (Loss) Attributable to Parent | (554,000) | (1,645,000) | ||||||||
Subsequent Event [Member] | ||||||||||
Restructuring and Related Cost, Number of Positions Eliminated, Period Percent | 20.00% | |||||||||
Restructuring and Related Cost, Number of Positions | 56 | |||||||||
Net Income (Loss) Attributable to Parent | (102,000) | (629,000) | $ (629,000) | |||||||
Retained Earnings (Accumulated Deficit) | (24,137,000) | $ (24,035,000) | ||||||||
Working Capital | 1,800,000 | 1,400,000 | ||||||||
Line of Credit, Current | 800,000 | $ 800,000 | ||||||||
Line of Credit Facility, Remaining Borrowing Capacity | 902,000 | |||||||||
Proceeds from Sales of Business, Affiliate and Productive Assets | 1,225,000 | |||||||||
Unbilled Receivables, Not Billable, Amount Expected to be Collected in Remainder of Fiscal Year | $ 6,500,000 | |||||||||
Increase (Decrease) in Unbilled Receivables, Percentage | 50.00% | |||||||||
Restructuring and Related Cost, Number of Positions | 71 | |||||||||
Proceeds from Advance Payment Arrangements | $ 1,200,000 |
Note 3 - Revenue Recognition (D
Note 3 - Revenue Recognition (Details Textual) - USD ($) | 3 Months Ended | ||
Jun. 25, 2016 | Jun. 27, 2015 | Mar. 28, 2015 | |
Minimum [Member] | |||
Warranty Term | 1 year | ||
Maximum [Member] | |||
Warranty Term | 1 year 180 days | ||
Unbilled Receivables, Not Billable, Amount Expected to be Collected in Remainder of Fiscal Year | $ 6,500,000 | ||
Revenue Recognition, Milestone Method, Revenue Recognized | $ 145,000 | $ 692,000 |
Note 4 - Inventories, Net of Re
Note 4 - Inventories, Net of Reserves (Details) - USD ($) $ in Thousands | Jun. 25, 2016 | Mar. 26, 2016 |
Raw materials | $ 3,635 | $ 3,489 |
Work-in-progress | 2,424 | 2,156 |
Finished goods | 147 | 2 |
Demonstration inventory | 41 | 47 |
Total | $ 6,247 | $ 5,694 |
Note 5 - Software Development35
Note 5 - Software Development Costs (Details Textual) - OLS Development Costs [Member] - USD ($) | Sep. 03, 2015 | Jul. 31, 2016 | Jun. 25, 2016 |
Subsequent Event [Member] | |||
Research and Development Expense, Software (Excluding Acquired in Process Cost) | $ 265,000 | ||
Research and Development Expense, Software (Excluding Acquired in Process Cost) | $ 919,000 | ||
Capitalized Computer Software, Additions | $ 1,200,000 |
Note 6 - Accounts Receivable 36
Note 6 - Accounts Receivable Line of Credit (Details Textual) - USD ($) | Jun. 01, 2015 | Jun. 25, 2016 | Mar. 26, 2016 |
New Amended Credit Facility 2 [Member] | Borrowing Base for International Services Sub-Limit [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,500,000 | ||
New Amended Credit Facility 2 [Member] | Formula-Basis Sub-Limit [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | 2,000,000 | ||
New Amended Credit Facility 2 [Member] | Non-Formula Basis Sub-Limit [Member] | |||
Line of Credit Facility, Maximum Borrowing Capacity | 500,000 | ||
New Amended Credit Facility 2 [Member] | Due on the Anniversary of the Loan Closing [Member] | |||
Line of Credit Facility, Commitment Fee Amount | $ 12,500 | ||
New Amended Credit Facility 2 [Member] | Prime Rate [Member] | |||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | ||
New Amended Credit Facility 2 [Member] | |||
Long-term Line of Credit | $ 2,500,000 | ||
Advance Rate | 80.00% | ||
Debt Instrument, Variable Interest Rate | 3.50% | ||
Debt Instrument, Interest Rate, Effective Percentage | 5.00% | ||
Line of Credit Facility, Commitment Fee Amount | $ 12,500 | ||
Asset Coverage Ratio | 135.00% | ||
Accounts Receivable, Aging from Invoice Date | 90 days | ||
Line of Credit, Current | $ 800,000 | $ 800,000 | |
Line of Credit Facility, Remaining Borrowing Capacity | $ 902,000 |
Note 7 - Term Loan, Revolving37
Note 7 - Term Loan, Revolving Line of Credit and Warrants (Details Textual) - USD ($) | Jun. 03, 2015 | Jun. 16, 2014 | Mar. 14, 2014 | Mar. 14, 2014 | Mar. 13, 2014 | Mar. 13, 2014 | Jul. 31, 2015 | Jun. 25, 2016 | Jun. 27, 2015 | Jun. 25, 2016 | Mar. 26, 2016 | Jan. 15, 2016 | Jun. 15, 2014 |
PFG Loan [Member] | Achievement of Performance Milestones First Half of Fiscal 2015 [Member] | |||||||||||||
Line of Credit Facility, Remaining Borrowing Capacity | $ 1,000,000 | $ 1,000,000 | |||||||||||
Debt Instrument, Performance Milestone Net Sales | $ 7,500,000 | ||||||||||||
PFG Loan [Member] | Achievement of Performance Milestones During Two Consecutive Quarters In Fiscal 2015 [Member] | Minimum [Member] | |||||||||||||
Debt Instrument, Performance Milestones, Net Income | $ 0 | ||||||||||||
PFG Loan [Member] | Under First Draw [Member] | Common Stock [Member] | |||||||||||||
Class of Warrant or Right, Outstanding | 180,000 | 180,000 | |||||||||||
Class of Warrant or Right, Exchanged for Cash, Amount | $ 150,000 | $ 150,000 | |||||||||||
PFG Loan [Member] | Under First Draw [Member] | |||||||||||||
Long-term Debt, Gross | 822,000 | 822,000 | |||||||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | 173,000 | ||||||||||||
Debt Instrument, Unamortized Discount | 178,000 | 178,000 | |||||||||||
PFG Loan [Member] | Amendment [Member] | Common Stock [Member] | |||||||||||||
Class of Warrant or Right, Outstanding | 80,000 | ||||||||||||
Class of Warrant or Right, Exchanged for Cash, Amount | $ 67,000 | 67,000 | |||||||||||
PFG Loan [Member] | Amendment [Member] | |||||||||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | 168,000 | ||||||||||||
PFG Loan [Member] | Second Amendment [Member] | Common Stock [Member] | |||||||||||||
Class of Warrant or Right, Cancelled During Period | 40,000 | ||||||||||||
PFG Loan [Member] | Partners For Growth IV, L.P. [Member] | Revolving Credit Facility [Member] | |||||||||||||
Debt Instrument, Term | 2 years 270 days | ||||||||||||
Line of Credit Facility, Remaining Borrowing Capacity | $ 500,000 | $ 1,000,000 | |||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 12.50% | ||||||||||||
Long-term Line of Credit | $ 500,000 | ||||||||||||
Repayments of Lines of Credit | $ 150,000 | ||||||||||||
Line of Credit Facility, Periodic Payment, Principal | $ 10,000 | ||||||||||||
PFG Loan [Member] | Secured Debt [Member] | |||||||||||||
Long-term Debt, Gross | $ 1,000,000 | $ 1,000,000 | |||||||||||
PFG Loan [Member] | Prepaid Expenses and Other Current Assets [Member] | |||||||||||||
Payments of Debt Issuance Costs | $ 30,000 | ||||||||||||
PFG Loan [Member] | Common Stock [Member] | |||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 300,000 | 300,000 | |||||||||||
Class of Warrant or Right, Term | 5 years | ||||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.42 | $ 1.42 | |||||||||||
PFG Loan [Member] | |||||||||||||
Debt Instrument, Term | 3 years | 30 years | |||||||||||
Debt Instrument, Face Amount | $ 2,000,000 | $ 2,000,000 | |||||||||||
Proceeds from Issuance of Debt | $ 1,000,000 | ||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 9.75% | 9.75% | |||||||||||
Long-term Debt | $ 270,000 | $ 270,000 | |||||||||||
Derivative Liability, Fair Value, Gross Liability | $ 353,000 | ||||||||||||
Fair Value Adjustment of Warrants | 46,000 | $ 63,000 | |||||||||||
Warrant Debt [Member] | Under First Draw [Member] | |||||||||||||
Long-term Debt, Gross | $ 178,000 | $ 178,000 | |||||||||||
Derivative Liability, Fair Value, Gross Liability | 184,000 | 184,000 | 212,000 | ||||||||||
Warrant Debt [Member] | Amendment [Member] | |||||||||||||
Derivative Liability, Fair Value, Gross Liability | 123,000 | 123,000 | $ 141,000 | ||||||||||
Warrant Debt [Member] | |||||||||||||
Derivative Liability, Fair Value, Gross Liability | 307,000 | 307,000 | |||||||||||
Partners For Growth IV, L.P. [Member] | Revolving Credit Facility [Member] | |||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 500,000 | ||||||||||||
Repayments of Lines of Credit | $ 500,000 | ||||||||||||
Bridge Bank [Member] | |||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | 2,500,000 | 2,500,000 | |||||||||||
Line of Credit Facility, Remaining Borrowing Capacity | 902,000 | $ 902,000 | |||||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.15 | ||||||||||||
Fair Value Adjustment of Warrants | (46,000) | 63,000 | |||||||||||
Amortization of Debt Discount (Premium) | $ 11,000 | $ 42,000 |
Note 8 - Fair Value (Details Te
Note 8 - Fair Value (Details Textual) - USD ($) | 3 Months Ended | |
Jun. 25, 2016 | Jun. 27, 2015 | |
Long-term Debt [Member] | ||
Long-term Debt | $ 254,000 | $ 370,000 |
Long-term Debt, Fair Value | $ 268,000 | 393,000 |
Derivative Financial Instruments, Liabilities [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value Inputs, Discount Rate | 20.00% | |
Fair Value Assumptions, Expected Term | 2 years 292 days | |
Fair Value Assumptions, Expected Volatility Rate | 117.80% | |
Fair Value Assumptions, Risk Free Interest Rate | 0.73% | |
Assets, Fair Value Disclosure, Recurring | $ 0 | 0 |
Assets, Fair Value Disclosure, Nonrecurring | 0 | 0 |
Liabilities, Fair Value Disclosure, Nonrecurring | $ 0 | $ 0 |
Note 8 - Fair Value Measurement
Note 8 - Fair Value Measurements (Details) - Fair Value, Inputs, Level 3 [Member] - USD ($) $ in Thousands | Jun. 25, 2016 | Jun. 27, 2015 |
Warrant [Member] | Fair Value, Measurements, Recurring [Member] | ||
Warrant Liability | $ 307 | $ 353 |
Total | $ 307 | $ 353 |
Note 8 - Summary of Changes in
Note 8 - Summary of Changes in Gains and Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 25, 2016 | Jun. 27, 2015 | |
Fair Value, Inputs, Level 3 [Member] | Warrant [Member] | Derivative Financial Instruments, Liabilities [Member] | ||
Warrant liability at beginning of year | $ 353 | $ 252 |
Losses (gains) on adjustment of warrant liability to fair value | 63 | |
Warrant liability at end of period | 307 | 315 |
Losses (gains) on adjustment of warrant liability to fair value | $ (46) |
Note 8 - Quantitative Informati
Note 8 - Quantitative Information (Details) - Warrant [Member] - Fair Value, Inputs, Level 3 [Member] - Derivative Financial Instruments, Liabilities [Member] | 3 Months Ended | 12 Months Ended |
Jun. 25, 2016 | Mar. 26, 2016 | |
Monte Carlo [Member] | ||
Fair Value Inputs, Discount Rate | 20.00% | |
Discounted Cash Flow [Member] | ||
Fair Value Inputs, Discount Rate | 20.00% |
Note 9 - Sale of Product Line42
Note 9 - Sale of Product Lines (Details Textual) - USD ($) | Jul. 28, 2016 | Jun. 20, 2016 | Dec. 15, 2015 | Jun. 30, 2016 | Aug. 31, 2016 | Jun. 25, 2016 | Jun. 27, 2015 | Jun. 25, 2015 | Dec. 31, 2016 | Jun. 25, 2016 |
Spanawave [Member] | Scenario, Forecast [Member] | ||||||||||
Proceeds from Sales of Business, Affiliate and Productive Assets | $ 1,100,000 | |||||||||
Proceeds from sale of Inventory | $ 350,000 | |||||||||
Spanawave [Member] | Subsequent Event [Member] | ||||||||||
Return of Payment | $ 375,000 | |||||||||
Spanawave [Member] | ||||||||||
Gain (Loss) on Sale of Business, Affiliated and Productive Assets | $ 0 | |||||||||
Proceeds from Sales of Business, Affiliate and Productive Assets | $ 1,500,000 | $ 375,000 | $ 750,000 | |||||||
Astronics Test Systems Inc [Member] | Switch Product Line [Member] | ||||||||||
Gain (Loss) on Sale of Business, Affiliated and Productive Assets | 802,000 | |||||||||
Proceeds from Sales of Business, Affiliate and Productive Assets | $ 850,000 | 850,000 | ||||||||
Standard Product Warranty Accrual, Period Increase (Decrease) | $ (278,000) | |||||||||
Sales Commision | 3.00% | 3.00% | ||||||||
Sales Commission, Term | 4 years | |||||||||
Cash Paid to Buy Out Future Commission Obligation | $ 170,000 | $ 170,000 | ||||||||
Astronics Test Systems Inc [Member] | Scenario, Forecast [Member] | ||||||||||
Proceeds from sale of Inventory | $ 500,000 | |||||||||
Astronics Test Systems Inc [Member] | ||||||||||
Proceeds from sale of Inventory | 275,000 | |||||||||
Switch Product Line [Member] | ||||||||||
Revenue, Net | 1,100,000 | $ 489,000 | ||||||||
Gross Profit | 437,000 | 217,000 | ||||||||
Power Meters, Amplifiers, and Legacy Signal Generators [Member] | ||||||||||
Revenue, Net | 275,000 | 780,000 | ||||||||
Gross Profit | 0 | 240,000 | ||||||||
Gain (Loss) on Sale of Business, Affiliated and Productive Assets | 802,000 | |||||||||
Proceeds from Sales of Business, Affiliate and Productive Assets | 1,225,000 | |||||||||
Revenue, Net | 3,442,000 | 4,375,000 | $ 4,375,000 | |||||||
Gross Profit | $ 925,000 | $ 1,728,000 |
Note 9 - Asset Purchase Agreeme
Note 9 - Asset Purchase Agreement (Details) - USD ($) | Jun. 20, 2016 | Jun. 30, 2016 | Jun. 25, 2016 | Jun. 27, 2015 |
Astronics Test Systems Inc [Member] | Switch Product Line [Member] | ||||
Cash received from Astronics | $ 850,000 | $ 850,000 | ||
Cash paid to buy out future commission obligation | $ (170,000) | (170,000) | ||
Employee severance | (97,000) | |||
Legal fees | (13,000) | |||
Commissions | (46,000) | |||
Warranty Liability released | 278,000 | |||
Net gain recognized in the quarter | 802,000 | |||
Cash received from Astronics | 1,225,000 | |||
Net gain recognized in the quarter | $ 802,000 |
Note 10 - Net Income (Loss) and
Note 10 - Net Income (Loss) and Common Shares Used in Per-share Computations (Details) - USD ($) $ / shares in Units, shares in Thousands | 3 Months Ended | ||
Jun. 25, 2016 | Jun. 27, 2015 | Jun. 25, 2015 | |
Equity Option [Member] | |||
Weighted average: | |||
Anti-dilutive securities excluded from computation of earning per share (in shares) | 1,529 | 1,623 | |
Restricted Stock [Member] | |||
Weighted average: | |||
Anti-dilutive securities excluded from computation of earning per share (in shares) | 432 | ||
Convertible Debt Securities [Member] | |||
Weighted average: | |||
Anti-dilutive securities excluded from computation of earning per share (in shares) | 1,853 | 1,853 | |
Warrant [Member] | |||
Weighted average: | |||
Anti-dilutive securities excluded from computation of earning per share (in shares) | 3,737 | 1,353 | |
Net Income (Loss) Attributable to Parent | $ (102,000) | $ (629,000) | $ (629,000) |
Basic (in shares) | 9,550 | 6,251 | |
Common shares assuming dilution (in shares) | 9,550 | 6,251 | |
Loss per common share – basic (in dollars per share) | $ (0.01) | $ (0.10) | |
Loss per common share – diluted (in dollars per share) | $ (0.01) | $ (0.10) |
Note 11 - Share-based Compens45
Note 11 - Share-based Compensation (Details Textual) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Jun. 25, 2016 | Jun. 27, 2015 | Mar. 26, 2016 | Mar. 30, 2013 | |
2000 Stock Option Plan and 2005 Equity Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | 12,500 | ||
Allocated Share-based Compensation Expense | $ 72,000 | $ 114,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 2,850,000 | |||
Percent Of Fair Market Value Of Common Stock At Date Of Grant | 100.00% | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 1,018,627 | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 376,000 | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years 215 days | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 28,500 | 38,500 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | $ 1,000 | $ 13,000 | ||
Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 0 | 0 | 50,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 0 | 50,000 | 482,000 | |
Allocated Share-based Compensation Expense | $ 0 | $ 221,000 | ||
Employee Stock Option [Member] | Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | |||
Employee Stock Option [Member] | Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | |||
Share-based Compensation Arrangement by Share-based Payment Award Expiration | 10 years | |||
Outstanding Options [Member] | Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award Expiration | 10 years | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 48,550 |
Note 11 - Weighted Average Assu
Note 11 - Weighted Average Assumptions (Details) | 3 Months Ended |
Jun. 25, 2016 | |
Expected volatility | 98.95% |
Risk-free interest rate | 1.38% |
Expected term (years) | 8 years 131 days |
Note 11 - Changes in Stock Opti
Note 11 - Changes in Stock Options Outstanding (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jun. 25, 2016 | Mar. 26, 2016 | Mar. 28, 2015 | |
Outstanding (in shares) | 1,592,200 | 1,726,975 | |
Outstanding (in dollars per share) | $ 1.52 | $ 1.57 | |
Outstanding | 6 years 255 days | 6 years 292 days | 6 years 328 days |
Outstanding | $ 5 | $ 69 | $ 219 |
Granted (in shares) | 50,000 | 35,000 | |
Granted (in dollars per share) | $ 1.26 | $ 1.22 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 48,550 | ||
Exercised (in dollars per share) | $ 1.59 | ||
Forfeited / Expired (in shares) | 113,200 | 121,225 | |
Forfeited / Expired (in dollars per share) | $ 1.73 | $ 2.15 | |
Outstanding (in shares) | 1,529,000 | 1,592,200 | 1,726,975 |
Outstanding (in dollars per share) | $ 1.49 | $ 1.52 | $ 1.57 |
Exercisable (in shares) | 997,000 | ||
Exercisable (in dollars per share) | $ 1.46 | ||
Exercisable | 6 years 73 days | ||
Exercisable | $ 5 | ||
At June 25, 2016 expected to vest in the future (in shares) | 423,054 | ||
At June 25, 2016 expected to vest in the future (in dollars per share) | $ 1.53 | ||
At June 25, 2016 expected to vest in the future | 7 years 109 days | ||
At June 25, 2016 expected to vest in the future |
Note 11 - Changes in Nonvested
Note 11 - Changes in Nonvested Restricted Stock Awards Outstanding (Details) - Restricted Stock [Member] - $ / shares | 3 Months Ended | 12 Months Ended | |
Jun. 25, 2016 | Jun. 27, 2015 | Mar. 26, 2016 | |
Non-vested (in shares) | 482,000 | 482,000 | |
Non-vested (in dollars per share) | $ 2.02 | $ 2.02 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 0 | 50,000 | 482,000 |
Vested (in dollars per share) | $ 2.02 |
Note 12 - Significant Custome49
Note 12 - Significant Customers and Industry Segment Information (Details Textual) | 3 Months Ended | |
Jun. 25, 2016 | Jun. 27, 2015 | |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | First Customer [Member] | Microsource [Member] | ||
Concentration Risk, Percentage | 30.00% | 31.00% |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Second Customer [Member] | Microsource [Member] | ||
Concentration Risk, Percentage | 16.00% | |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Second Customer [Member] | Gigatronics Division [Member] | ||
Concentration Risk, Percentage | 22.00% | |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Third Customer [Member] | Gigatronics Division [Member] | ||
Concentration Risk, Percentage | 17.00% | 13.00% |
Number of Reportable Segments | 2 |
Note 12 - Segment Reporting Inf
Note 12 - Segment Reporting Information (Details) - USD ($) | 3 Months Ended | |||
Jun. 25, 2016 | Jun. 27, 2015 | Jun. 25, 2015 | Mar. 26, 2016 | |
Gigatronics Division [Member] | ||||
Assets | $ 8,233,000 | $ 6,438,000 | ||
Net sales | 2,125,000 | 2,117,000 | ||
Net loss | (554,000) | (1,645,000) | ||
Microsource [Member] | ||||
Assets | 3,887,000 | 2,053,000 | ||
Net sales | 1,317,000 | 2,258,000 | ||
Net loss | 452,000 | 1,016,000 | ||
Assets | 12,120,000 | 8,491,000 | $ 11,193,000 | |
Net sales | 3,442,000 | $ 4,375,000 | 4,375,000 | |
Net loss | $ (102,000) | $ (629,000) | $ (629,000) |
Note 13 - Income Taxes (Details
Note 13 - Income Taxes (Details Textual) - USD ($) | 3 Months Ended | |||
Jun. 25, 2016 | Jun. 27, 2015 | Mar. 26, 2016 | Jun. 28, 2014 | |
Income Tax Expense (Benefit) | $ 0 | $ 0 | ||
Effective Income Tax Rate Reconciliation, Percent | 0.00% | 0.00% | ||
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued | $ 106,000 | $ 45,000 |
Note 14 - Reconciliation of Com
Note 14 - Reconciliation of Company's Estimated Warranty Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 25, 2016 | Jun. 27, 2015 | |
Balance at beginning of period | $ 60 | $ 76 |
Provision, net | 112 | 17 |
Warranty costs incurred | (112) | (18) |
Balance at end of period | $ 60 | $ 75 |
Note 15 - Series B, C, D Conv53
Note 15 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details Textual) - USD ($) | Jul. 08, 2013 | Feb. 19, 2013 | Nov. 10, 2011 | Mar. 26, 2016 | Jun. 25, 2016 | Jan. 15, 2016 | May 31, 2015 | Feb. 23, 2015 | Feb. 16, 2015 |
Series B Preferred Stock [Member] | |||||||||
Proceeds from Issuance of Preferred Stock, Preference Stock, and Warrants | $ 2,199,000 | ||||||||
Preferred Stock, Shares Issued | 9,997 | 9,997 | |||||||
Sale of Stock, Price Per Share | $ 220 | ||||||||
Preferred Stock, Value, Issued | $ 2,000,000 | ||||||||
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | $ 202,000 | ||||||||
Series C Preferred Stock [Member] | |||||||||
Preferred Stock, Shares Issued | 3,424.65 | 3,424.65 | |||||||
Sale of Stock, Price Per Share | $ 146 | ||||||||
Preferred Stock, Value, Issued | $ 457,000 | ||||||||
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | 43,000 | ||||||||
Proceeds from Issuance of Preferred Stock and Preference Stock | $ 500,000 | ||||||||
Series D Preferred Stock [Member] | SPA [Member] | Unallocated [Member] | |||||||||
Proceeds from Issuance of Convertible Preferred Stock | $ 817,000 | ||||||||
Series D Preferred Stock [Member] | SPA [Member] | Allocated [Member] | |||||||||
Proceeds from Issuance of Convertible Preferred Stock | 498,000 | ||||||||
Proceeds from Issuance of Common Stock | $ 360,000 | ||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.97 | ||||||||
Series D Preferred Stock [Member] | SPA [Member] | |||||||||
Payments of Stock Issuance Costs | $ 41,000 | ||||||||
Debt Instrument, Convertible, Beneficial Conversion Feature | $ 238,000 | ||||||||
Series D Preferred Stock [Member] | |||||||||
Preferred Stock, Shares Issued | 5,111.86 | 5,111.86 | |||||||
Proceeds from Issuance of Convertible Preferred Stock | $ 858,000 | ||||||||
Series B, C, and D Preferred Stock [Member] | |||||||||
Preferred Stock, Shares Issued | 18,533.51 | 18,533.51 | |||||||
Preferred Stock, Value, Issued | $ 2,911,000 | $ 2,911,000 | |||||||
Convertible Preferred Stock, Shares Issued upon Conversion | 100 | ||||||||
New Warrant [Member] | Alara Capital AVI II, LLC [Member] | |||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 194,437 | 898,634 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.76 | $ 1.78 | |||||||
New Warrant [Member] | |||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 511,186 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.43 | ||||||||
Alara Capital AVI II, LLC [Member] | |||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,017,405 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.43 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.15 |
Note 15 - Preferred Stock Infor
Note 15 - Preferred Stock Information (Details) - USD ($) $ in Thousands | Jun. 25, 2016 | Mar. 26, 2016 | Jul. 08, 2013 | Feb. 19, 2013 | Nov. 10, 2011 |
Series B Preferred Stock [Member] | |||||
Designated Shares (in shares) | 10,000 | ||||
Preferred Stock, Shares Issued | 9,997 | 9,997 | |||
Shares Outstanding (in shares) | 9,997 | ||||
Liquidation Preference | $ 2,309 | ||||
Series C Preferred Stock [Member] | |||||
Designated Shares (in shares) | 3,500 | ||||
Preferred Stock, Shares Issued | 3,424.65 | 3,424.65 | |||
Shares Outstanding (in shares) | 3,424.65 | ||||
Liquidation Preference | $ 500 | ||||
Series D Preferred Stock [Member] | |||||
Designated Shares (in shares) | 6,000 | ||||
Preferred Stock, Shares Issued | 5,111.86 | 5,111.86 | |||
Shares Outstanding (in shares) | 5,111.86 | ||||
Liquidation Preference | $ 731 | ||||
Series B, C, and D Preferred Stock [Member] | |||||
Designated Shares (in shares) | 19,500 | 19,500 | |||
Preferred Stock, Shares Issued | 18,533.51 | 18,533.51 | |||
Shares Outstanding (in shares) | 18,533.51 | 18,533.51 | |||
Liquidation Preference | $ 3,540 | $ 3,540 |
Note 16 - Private Placement O55
Note 16 - Private Placement Offering (Details Textual) $ / shares in Units, $ in Millions | Jan. 19, 2016USD ($)$ / sharesshares | Jan. 15, 2016$ / shares |
Common Stock [Member] | ||
Securities Purchase Agreement, Purchase Price | $ 1.15 | |
Warrant [Member] | ||
Securities Purchase Agreement, Purchase Price | 0.09375 | |
Securities Purchase Agreement, Price of One Common Share | 0.125 | |
Emerging Growth Equities, Ltd [Member] | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.15 | |
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 292,727 | |
Securities Purchase Agreement, Units Issued | shares | 2,787,872 | |
Number of Common Stock Per Unit | shares | 1 | |
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | shares | 0.75 | |
Number of Private Investors | 20 | |
Securities Purchase Agreement, Purchase Price | $ 1.24375 | |
Securities Purchase Agreement, Gross Proceeds | $ | $ 3.5 | |
Securities Purchase Agreement, Net Proceeds | $ | $ 3.1 | |
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.15 | |
Warrant Term | 5 years |
Note 17 - Exercise of Series 56
Note 17 - Exercise of Series C and Series D Warrants (Details Textual) | Jan. 19, 2016 | May 14, 2015shares | Feb. 23, 2015USD ($)$ / sharesshares | Feb. 16, 2015USD ($)$ / sharesshares | Mar. 28, 2015USD ($) | Jan. 15, 2016$ / shares | May 31, 2015$ / sharesshares | Jul. 08, 2013$ / sharesshares |
Alara Capital AVI II, LLC [Member] | Series C and D Warrants [Member] | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,002,818 | 1,002,818 | ||||||
Proceeds from Issuance of Preferred Stock, Preference Stock, and Warrants | $ | $ 1,500,000 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 1.43 | |||||||
Alara Capital AVI II, LLC [Member] | Series C and D Warrants [Member] | ||||||||
Proceeds from Warrant Exercises | $ | $ 1,434,000 | |||||||
Payments of Stock Issuance Costs | $ | $ 42,000 | |||||||
Alara Capital AVI II, LLC [Member] | New Warrant [Member] | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 194,437 | 898,634 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 1.76 | $ 1.78 | ||||||
Number of Warrants Sold | 2 | |||||||
Warrant Purchase Price | $ | $ 137,000 | |||||||
Warrant Purchase Price Per Share | $ / shares | $ 0.125 | |||||||
Warrant Term | 5 years | |||||||
Alara Capital AVI II, LLC [Member] | Additional Warrant [Member] | ||||||||
Class of Warrant or Right, Outstanding | 14,587 | |||||||
Alara Capital AVI II, LLC [Member] | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,017,405 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 1.43 | |||||||
Class of Warrant Or Right Exercised in Period | 14,587 | |||||||
Shares Issued Upon Cashless Warrant Exercise | 7,216 | |||||||
New Warrant [Member] | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 511,186 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 1.43 | |||||||
Fair Value Assumptions, Expected Term | 5 years | |||||||
Fair Value Assumptions, Risk Free Interest Rate | 1.54% | |||||||
Fair Value Assumptions, Expected Volatility Rate | 90.00% | |||||||
Fair Value Assumptions, Expected Dividend Rate | 0.00% | |||||||
Issuance of Warrants [Member] | ||||||||
Other Expenses | $ | $ 1,200,000 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 1.15 | |||||||
Warrant Term | 5 years |