RCMT RCM Technologies Inc

RCM TECHNOLOGIES, INC.

FORM 10-K

TABLE OF CONTENTS

 

 

 

PART I			1
	Item 1.	Business	2
	Item 1A.	Risk Factors	15
	Item 1B.	Unresolved Staff Comments	21
	Item 1C.	Cybersecurity	21
	Item 2.	Properties	22
	Item 3.	Legal Proceedings	23
	Item 4.	Mine Safety Disclosures	23
PART II			24
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	24
	Item 6.	[Reserved]	24
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25
	Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	44
	Item 8.	Financial Statements and Supplementary Data	44
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	44
	Item 9A.	Controls and Procedures	45
	Item 9B.	Other Information	46
	Item 9C.	Disclosure Regarding Foreign Jurisdictions That Prevent Inspections	47
PART III			48
	Item 10.	Directors, Executive Officers and Corporate Governance	48
	Item 11.	Executive Compensation	48
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	48
	Item 13.	Certain Relationships and Related Transactions, and Director Independence	49
	Item 14.	Principal Accountant Fees and Services	49
PART IV			50
	Item 15.	Exhibits and Financial Statement Schedules	50
	Item 16.	Form 10-K Summary	53
	Signatures		54

 

 

PART I

 

Private Securities Litigation Reform Act Safe Harbor Statement

 

Certain statements included herein and in other reports and public filings made by RCM Technologies, Inc. (“RCM” or the “Company”) are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements regarding the adoption by businesses of new technology solutions; the use by businesses of outsourced solutions, such as those offered by the Company, in connection with such adoption; the Company’s strategic and business initiatives and growth strategies; and the outcome of litigation (at both the trial and appellate levels) and arbitrations, or other business disputes, involving the Company. Readers are cautioned that such forward-looking statements, as well as others made by the Company, which may be identified by words such as “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” “believe,” and similar expressions, are only predictions and are subject to risks and uncertainties that could cause the Company’s actual results and financial position to differ materially from such statements. Such risks and uncertainties include, without limitation: (i) unemployment and general economic conditions affecting the provision of life sciences, information technology and engineering services and solutions and the placement of temporary staffing personnel; (ii) the Company’s ability to continue to attract, train and retain personnel qualified to meet the requirements of its clients; (iii) the Company’s ability to identify appropriate acquisition candidates, complete such acquisitions and successfully integrate acquired businesses; (iv) the Company’s relationships with and reliance upon significant customers, and ability to collect accounts receivable from such customers; (v) risks associated with foreign currency fluctuations and changes in exchange rates, particularly with respect to the Canadian dollar; (vi) uncertainties regarding amounts of deferred consideration and earnout payments to become payable to former shareholders of acquired businesses; (vii) the adverse effect a potential decrease in the trading price of the Company’s common stock would have upon the Company’s ability to acquire businesses through the issuance of its securities; (viii) the Company’s ability to obtain financing on satisfactory terms; (ix) the reliance of the Company upon the continued service of its executive officers; (x) the Company’s ability to remain competitive in the markets that it serves; (xi) the Company’s ability to maintain its unemployment insurance premiums and workers compensation premiums; (xii) the risk of claims being made against the Company associated with providing temporary staffing services; (xiii) the Company’s ability to manage significant amounts of information and periodically expand and upgrade its information processing capabilities; (xiv) the risk of cyber attacks on our information technology systems or those of our third party vendors; (xv) the Company’s ability to remain in compliance with federal and state wage and hour laws and regulations; (xvi) uncertainties in predictions as to the future need for the Company’s services; (xvii) uncertainties relating to the allocation of costs and expenses to each of the Company’s operating segments; (xviii) the costs of conducting and the outcome of litigation, arbitrations and other business disputes involving the Company, and the applicability of insurance coverage with respect to any such litigation; (ixx) the results of, and costs relating to, any interactions with shareholders of the Company who may pursue specific initiatives with respect to the Company’s governance and strategic direction, including without limitation a contested proxy solicitation initiated by such shareholders, or any similar such interactions; and (xx) other geopolitical, economic, competitive, health and governmental factors affecting the Company’s operations, markets, products and services. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required by law, the Company undertakes no obligation to publicly release the results of any revision of these forward-looking statements to reflect these trends or circumstances after the date they are made or to reflect the occurrence of unanticipated events.

 

 

ITEM 1. BUSINESS

 

General

 

RCM Technologies, Inc. is a premier provider of business and technology solutions designed to enhance and maximize the operational performance of its customers. The Company provides these services through the deployment of specialty healthcare, engineering, life sciences, information technology services, data management and solutions. For over 50 years, the Company has developed and assembled an extensive portfolio of capabilities, service offerings and delivery options with world class technical talent in key end markets and high-growth industries. This combination, paired with RCM’s efficient pricing structure and global reach, offers clients a compelling value proposition.

 

RCM consists of three operating segments: Specialty Health Care, Engineering, and Life Sciences, Data and Solutions (LS&D).

 

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The Specialty Health Care segment provides staffing solutions including medical healthcare professionals, health information management professionals, nurses, paraprofessionals, physicians and therapists for many of the largest healthcare institutions and school districts across the United States. The segment also provides teletherapy services targeting the education sector with an emphasis on behavioral health.

 

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The Engineering segment provides a comprehensive portfolio of engineering and design services across three verticals: (1) Energy Services, (2) Process & Industrial and (3) Aerospace. The segment also offers a complementary suite of consulting solutions and services to augment its engineering portfolio, including design and supply of high-quality engineered process solutions and equipment, data management, technical writing and digital documentation across marine, locomotive, transportation and aerospace markets, integrated design and construction, and engineering, procurement and construction management (“EPC”), as well as demand side management/energy conservation services. The business segment staffs engineers to design and build critical infrastructure projects for clients with international coverage.

 

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The Life Sciences, Data and Solutions segment specializes in offering a wide range of services including enterprise business solutions, application development and support, IT infrastructure deployment and management, and technology and business solutions tailored for the Life Sciences industry and other specific verticals. Additionally, LS&D provides data solutions, digitization, human capital management solutions, and innovative uses of technology to optimize business operations, ranging from process automation to advanced techniques deploying artificial intelligence (“AI”). Our industry-leading Managed Service Offering demonstrates the value of collaborating with customers to foster quality improvements in a seamless integrated function.

 

The Company services some of the largest national and international companies in North America as well as a lengthy roster of Fortune 1000 and mid-sized global businesses in such industries as Aerospace/Defense, Educational Institutions, the Energy Sector, Financial Services, Healthcare, Life Sciences, Manufacturing & Distribution, the Public Sector and Technology. RCM sells and delivers its services through a network of approximately 27 offices in selected regions throughout North America and Europe. The Company has staffed key personnel to design and build internationally recognized critical infrastructure projects and retained strategic partners and client accounts for decades.

 

During the fiscal year ended December 28, 2024, approximately 51.2% of RCM’s total revenue was derived from Specialty Health Care services, 34.7% from Engineering services, and the remaining 14.1% from Life Sciences, Data and Solutions.

 

Industry Overview

 

Businesses today face intense competition, the challenge of constant technological change and the ongoing need for business process optimization. To address these issues and to compete more effectively, companies are continually evaluating the need for implementing innovative solutions to upgrade their systems, applications and processes. As a result, the ability of an organization to integrate and align advanced technologies with new business objectives is critical for operational excellence.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Industry Overview (Continued)

 

In the healthcare services industry, a shortage of nurses and other medical personnel in the United States has led to increases in business activity for healthcare service companies, including the Company’s Specialty Health Care group. Due in part to an aging population and improved medical technology, the demand for selected health care professionals is expected to continue over the next several years, with an emphasis on leveraging technology to expand access to care. The increased adoption of telemedicine, an area in which the Specialty Health Care group has developed new service offerings, is a primary example. In addition, public educational institutions are outsourcing their requirements for school nurses, therapists and paraprofessionals to lower their costs and it is expected that this will continue and grow. Various factors, including the COVID pandemic, technological advances and patient habits have also altered patterns in healthcare delivery, with newer delivery models gaining traction, namely telemedicine. Given federal and state regulatory changes as well as private insurer reimbursement methods, utilization of telemedicine services increased significantly. CDC researchers stated that maintaining the expansion of telehealth remains critical to providing access to care. It is expected the total addressable market opportunity will continue to expand and grow. Expanding access to behavioral health and mental well-being is also a priority for public health officials. Increasing and maintaining access to proper care remains a top priority and the market opportunity for these services is expected to continue to grow.

 

The Company’s Engineering group remains focused on areas of growth, primarily within the utility/electric power, aerospace, marine and transportation, commercial and industrial, oil and gas, as well as biofuel industries. Given the current composition of its customer base, the Engineering group’s performance is well balanced between its three segments. In recent years, many electric utilities have prioritized transitioning their power generation assets to cleaner sources of energy. Much of this transformation is being driven by investments in renewable energy. The Energy Information Administration (“EIA”) estimates that 38% of the United States’ electric generation capacity will be comprised of wind and solar assets by 2050. This expansion will require extensive investment in the nation’s transmission infrastructure to interconnect these renewable resources to the energy grid. Projects of this scale will require engineering and design expertise, as well as the utilization of integrated design and EPC services. The Company believes its Process and Industrial group is positioned well to serve its market. Companies in the chemical industry are reprioritizing spending towards decarbonization technologies, with many U.S. chemical companies expecting to place an emphasis on renewable feedstocks and new carbon recycling technologies. The Company believes its process engineering services can play a vital role across this multibillion-dollar opportunity.

 

Companies increasingly leverage a mix of on-premise, cloud, and hybrid IT infrastructure to optimize operations and remain agile in a rapidly evolving technology landscape. Many organizations are transitioning to cloud-based solutions for scalability, cost-effectiveness, and flexibility while maintaining some on-premise infrastructure for critical or sensitive applications. LS&D’s hybrid approach allows companies to balance control and security with the benefits of cloud resources.

 

To assist companies in managing their IT infrastructure effectively, RCM is helping companies adopt advanced automation and AI tools to monitor, manage, and optimize their systems. Automation reduces manual intervention, speeds up operations, and improves efficiency, while AI is used for predictive analytics, detecting anomalies, and improving decision-making.

 

Ultimately, as technology evolves, businesses will continue to adapt by embracing more flexible, scalable, and intelligent IT infrastructures that can handle the complexities of a digital-first world while staying resilient against security threats and technological disruptions.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Business Strategy

 

The Company is dedicated to providing solutions to meet its clients’ business needs by delivering specialty healthcare, engineering, life sciences, data and solutions. The Company’s objective is to remain a recognized leader of specialized professional staffing, consulting services and solutions in major markets throughout North America and select international markets. The Company adapts operating strategies to achieve this objective. The following is a discussion of the key elements of its growth and operating strategies:

 

Growth Strategy

 

Promote Full Life Cycle Solution Capability

The Company promotes a full life cycle solution capability to its customers. The goal of the full life cycle solution strategy is to fully address a client’s project implementation cycle at each stage of its design, development and deployment. This entails the Company working with its clients from the initial conceptualization of a project through its design and project execution, and extending into ongoing management and support of the delivered product. RCM’s strategy is to build projects and integrated solutions offerings selectively, utilizing its extensive resource base.

 

The Company believes that the effective execution of this strategy will generate improved margins on its existing resources. The completion of this service-offering continuum is intended to afford the Company the opportunity to strengthen long-term client relationships that will further contribute to a more predictable revenue stream.

 

In addition to a full life cycle solution offering, the Company continues to focus on transitioning into higher value oriented services in an effort to increase its margins on its various service lines and generate revenue that is more sustainable. The Company believes this transition is accomplished by pursuing additional vertical market specific solutions in conjunction or combination with longer-term based solutions, through expansion of its global client relationships and by pursuing strategic alliances and partnerships.

 

Achieve Internal Growth

The Company continues to promote its internal growth strategies which it designed to better serve the Company’s customers, generate higher revenue and achieve greater operating efficiencies. Every division of the Company continuously focuses on services and client portfolio diversification. Business units are collaborating on penetrating and servicing accounts as sales teams are increasing their activity levels. This enables clients to be supported by specialists in their areas of need while RCM productivity increases.

 

RCM provides an orientation program in which sales managers and professionals receive relevant information about Company operations.

 

RCM has adopted an industry-centric approach to sales and marketing. This initiative contemplates that clients within the same industry sectors tend to have common business challenges. It therefore allows the Company to present and deliver enhanced value to those clients in the vertical markets in which RCM has assembled the greatest work experience. RCM’s consultants continue to acquire project experience that offers differentiated awareness of the business challenges that clients in that industry are facing. This alignment also facilitates and creates additional innovative cross-selling opportunities. The Company believes this strategy will lead to greater account penetration, strategic partnerships, and enhanced client relationships.

 

Operational strategies contributing to RCM’s internal productivity include the delineation of certain new solutions practice areas in markets where its clients had historically known the Company as a contract service provider. The formation of these new practice areas facilitates the flow of project opportunities and the delivery of project-based solutions.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Growth Strategy (Continued)

 

Pursue Selective Strategic Acquisitions

The industries in which the Company operates continue to be highly fragmented, and the Company plans to continue to selectively assess opportunities to make strategic acquisitions as such opportunities are presented to the Company. The Company's acquisition strategy is designed to broaden the scope of services and technical competencies and grow its full life cycle solution capabilities. In considering acquisition opportunities, the Company focuses principally on companies with (i) technologies or market segments RCM has targeted for strategic value enhancement, (ii) margins that are accretive to existing margins, (iii) experienced management personnel, (iv) substantial growth prospects and (v) sellers who desire to join the Company’s management team. To retain and provide incentives for management of its acquired companies, the Company has generally structured a significant portion of the acquisition price in the form of multi-tiered consideration based on growth of operating profitability of the acquired company over a two-to-four-year period.

 

Operating Strategy

 

Develop and Maintain Strong Customer Relationships

The Company seeks to develop and maintain strong cross-functional customer relationships by anticipating and focusing on its customers’ needs. The Company emphasizes a relationship-oriented and partnership-based approach to business, rather than the transaction or assignment-oriented approach that the Company believes is used by many of its competitors. This industry-centric strategy is designed to allow RCM to expand further its relationships with clients in RCM’s targeted sectors.

 

To develop close customer relationships, the Company’s practice managers and/or salespeople regularly meet with both existing and prospective clients to identify areas of need and help design solutions and identify the resources needed to execute their strategies. The Company’s managers also maintain close communications with their customers during each project and on an ongoing basis after its completion. The Company believes that this relationship-oriented approach can result in greater customer satisfaction. Additionally, the Company believes that by collaborating with its customers in designing business solutions, it can generate new opportunities to cross-sell additional services that the Company has to offer. The Company focuses on providing customers with qualified individuals or teams of experts compatible with the business needs of its customers and makes a concerted effort to follow the progress of such relationships to ensure their continued success.

 

Attract and Retain Highly Qualified Consultants and Technical Resources

The Company believes it has been successful in attracting and retaining highly qualified consultants and contractors by (i) providing stimulating and challenging work assignments while fostering a culture of innovation, (ii) offering competitive wages, (iii) effectively communicating with its candidates, (iv) providing selective training to maintain and upgrade skills and (v) aligning the needs of its customers with appropriately skilled personnel. The Company believes it has been successful in retaining these personnel due in part to its use of practice managers who are dedicated to maintaining contact with, and monitoring the satisfaction levels of, the Company’s consultants and contractors while they are on assignment.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Specialty Health Care

 

The Company’s Specialty Health Care Group specializes in long-term and short-term staffing of medical professionals as well as executive search, international recruitment, and placement solutions for many of the largest healthcare institutions and school districts across the United States. The segment’s portfolio of services includes, but is not limited to, the following fields:

 

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Allied and Therapy Staffing: Specializes in recruiting outstanding professionals across the healthcare industry. Our allied healthcare professionals and therapists work in schools, health systems, hospitals, nursing homes, and rehabilitation facilities.

 

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Correctional Healthcare Staffing: Staffing services for local, state and federal correctional facilities and provide screening, onboarding, and employee assessments as well as employee and inmate vaccination and treatment services.

 

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Health Information Management: Provide healthcare organizations with experienced medical coding professionals that manage staffing shortages, backlogs, vacation coverage and long-term coding support.

 

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Nursing Services: Provides nurse placement and staffing services in healthcare facilities, schools, hospitals and correctional facilities.

 

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Physicians and Advanced Practice: Our national locum tenens (temporary practitioner) practice specializes in placing physicians, physician assistants and nurse practitioners.

 

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School Staffing and Recruitment: Provides full-time and part-time nurse employment services for school districts across the country. The Company also offers other healthcare professionals to perform school evaluations and treat students, including occupational and physical therapists, speech and language pathologists, as well as special education support services and registered behavioral technicians to support students’ individualized education plan and behavioral health needs.

 

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Telepractice: The Company’s teletherapy solution is an evidence-based service delivery option for students to receive Special Education services such as Speech-Language Therapy, Occupational Therapy, Physical Therapy, Behavioral and Mental Health services and other healthcare services through an online platform.

 

Maintaining the utilization of telemedicine has become and remains critical to providing necessary access to care. Expanding access to behavioral health and mental wellness services is also a priority for many public health officials. The Company’s School Services and Telepractice offerings are well positioned to provide solutions in these areas of priority as the market opportunity for these services is expected to continue to grow.

 

As of December 28, 2024, the Company assigned approximately 3,140 specialty healthcare services personnel to its customers.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Engineering

 

RCM provides a full range of Engineering services including Project Management Engineering, Integrated Design Engineering, Transmission & Distribution Power Delivery, Engineering Analysis, Engineering-Procurement-Construction, Configuration Management, Hardware/Software Validation & Verification, Quality Assurance, Technical Writing & Publications, Manufacturing Process Planning & Improvement and 3D/BIM Integrated Design. Engineering services are provided at the site of the client or at the Company’s own facilities.

 

The Company’s Engineering segment consists of three business units – Energy Services, Aerospace Services and Process & Industrial Services.

 

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Energy Services: Provides solutions to the utility industry, including power generation and transmission and distribution. The group has highly technical project experience that encompasses multi-disciplined engineering and design services as well as providing technical support during design, construction and substation operational phases. The Company believes that the deregulation of the utilities industry, the aging of nuclear power plants, and increased demand for renewable energy offers the Company an opportunity to capture a greater share of professional services and project management requirements of the utilities industry. Electric utilities have prioritized transitioning their power generation assets to cleaner sources of energy and grid modernization initiatives. This expansion requires large-scale investment in the nation’s transmission infrastructure to interconnect these renewable resources to the energy grid.

 

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Aerospace Services: Provides engineering and technical services to the aerospace & defense industry. According to the Congressional Budget Office (“CBO”), the Department of Defense plans to spend over $1 trillion in procurement-related aviation expenditures over the next three decades. Given RCM’s customer account relationships with several of the largest defense prime contractors, the Company believes there is ample opportunity for engineering services and technical publication work, including production and procurement engineering services as well as the need for sustainment and development program publication services, data management and digital solutions.

 

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Process & Industrial Services: Provides engineering services to the industrial, chemical, commercial and oil and gas industries in the United States, Europe and Canada. With many companies in the chemical industry reprioritizing spending towards decarbonization technologies, many U.S. chemical companies are expected to place an emphasis on renewable feedstocks and new carbon recycling technologies. The Company believes its process engineering services and specialized hydrogen capabilities can play a vital role across this multibillion-dollar opportunity.

 

The Company provides its engineering services through several multi-disciplinary delivery methods. These include managed tasks and resources, complete project services, outsourcing, both on and off-site, and a full complement of resourcing alternatives.

 

As of December 28, 2024, the Company assigned approximately 510 engineering and technical personnel to its customers.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Life Sciences, Data and Solutions

 

The Company’s Life Sciences, Data and Solutions segment is an integrated group of business units providing comprehensive solutions through Managed Services, Project, and On-Demand Staffing Support delivery models. With physical locations in the United States, Canada, Puerto Rico, and the Philippines, our LS&D segments provides solutions on a global scale in the areas of Financial, Human Capital Management, Technical, Manufacturing, Commercialization, Data Warehouse, and Distribution.  Specialized project solutions include, but are not limited to, the following areas:

 

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Life Sciences: Specializes in providing innovative solutions to pharmaceutical, medical device, and biotechnology companies in technology deployment, strategy, guidance, quality control, and compliance. The group assists in staffing, solution planning, and remediation needs in automation, compliance, data analytics, technical quality assurance and management, and validation and verification.   LS&D is helping pharmaceutical and medical device companies integrate AI into their operations to drive innovation, improve efficiency, and enhance patient outcomes. Besides using AI to identify potential drug candidates, predict molecular interactions, and optimize clinical trial designs. RCM is using AI-powered tools to help streamline the regulatory approval process by analyzing patterns in regulatory data and improving submission accuracy.   The role of AI in pharmaceutical and medical device industries is poised to grow even further. Using advanced machine learning algorithms, LS&D continues to refine how we can address treatments for complex diseases.

 

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Data & Solutions and IT Services: Global provider of business and technology solutions designed to improve the operational performance of our clients. Specialties include software development, infrastructure services, data management, human capital management, and managed IT solutions. The Company has a 40-year history of providing qualified IT candidates to customers in a timely and cost-effective manner to address their specific business needs. The Company offers scalable solutions that can provide emerging growth companies with a single qualified resource or an entire project team along with RCM’s project management oversight to Fortune 100 clients.   RCM’s data solutions group is leading the way for pharmaceutical companies to transform how data is employed through AI tools. Through AI-driven predictive analytics, we have seen improved drug development timelines, eased regulatory hurdle achievement, and improved quality.

 

RCM’s sector knowledge coupled with technical and business process experience enable the Company to provide strategic planning, project execution and management and support services throughout the entire project life cycle. RCM has successfully completed multimillion-dollar projects in a variety of industry verticals using time-tested methodologies that manage strict budgets, timelines and quality metrics.

 

The Company believes that its ability to deliver life sciences, data and solutions across a wide range of technical platforms provides an important competitive advantage. RCM ensures that its consultants have the expertise and skills needed to keep pace with rapidly evolving information technologies. The Company’s strategy is to maintain expertise and acquire knowledge in multiple technologies so it can offer its clients non-biased technology solutions best suited to their business needs.

 

The Company provides its life sciences, data and solutions through a number of flexible delivery methods. These include management consulting engagements, project management of client efforts, business process outsourcing, project implementation of client initiatives, recruiting process outsourcing, both on and off site, and a full complement of human capital management solutions and resourcing alternatives.

 

As of December 28, 2024, the Company assigned approximately 200 Life Sciences, Data and Solutions personnel to its customers.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Branch Offices

 

The Company’s organization consists of 27 branch offices located in the United States, Canada, Germany, Philippines, Puerto Rico and Serbia. The locations and services of each of the branch offices are set forth in the table below.

 

LOCATION		NUMBER OF OFFICES	SERVICES PROVIDED(1)
UNITED STATES
	Alabama	1	HC
	Arizona	1	HC
	California	3	HC
	Connecticut	1	E
	Florida	2	HC, E
	Hawaii	1	HC
	Illinois	1	HC
	Massachusetts	1	HC
	New Jersey	2	E, LS&D
	New York	3	E, HC
	Rhode Island	1	E
	Tennessee	1	HC
	Texas	1	HC
		19
CANADA		1	E
GERMANY		1	E
PHILIPPINES		1	HC, E, LS&D
PUERTO RICO		2	E, LS&D
SERBIA		3	E, LS&D

 

 

(1) Services provided are abbreviated as follows:
	E	- Engineering
	HC	- Specialty Health Care
	LS&D	- Life Sciences, Data and Solutions

 

The Company is headquartered in the United States and its segments operate in the United States, Canada, Germany, Philippines, Puerto Rico and Serbia.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

International Operations

 

The Company operates its international business in Canada, Germany, Philippines, Puerto Rico and Serbia. For the fiscal year ended December 28, 2024, approximately 7.8% of the Company’s revenue was generated outside the United States. There are certain risks inherent in conducting business internationally including: the imposition of trade barriers, the enactment of tariffs, foreign exchange restrictions, longer payment cycles, greater difficulties in accounts receivables collection, difficulties in complying with a variety of foreign laws (including without limitation the U.S. Foreign Corrupt Practices Act), changes in legal or regulatory requirements, including as to laws and regulations governing economic and trade sanctions, difficulties in staffing and managing foreign operations, complex and uncertain employment environments, political instability and potentially adverse tax consequences. Our operations in Serbia could be adversely affected by the current conflict between Ukraine and Russia, with which Serbia has substantial ties. Should sanctions against Russia affect Russia in a way that causes adverse economic consequences to Serbia, or if such sanctions were to be extended to countries that might be considered to be in alignment with Russia, thus could have a negative impact on our employees or operations both within and outside Serbia. To the extent the Company experiences these risks, the business and results of operations could be adversely affected.

 

From its headquarters locations in New Jersey, the Company provides its branch offices with centralized administrative, marketing, finance, MIS, human resources and legal support. Centralized administrative functions and shared services minimize the administrative burdens on branch office managers and allow them to spend more time focusing on sales and marketing, client relations and practice development activities.

 

Branch offices are primarily located in markets that the Company believes have strong growth prospects for the Company’s services. The Company’s branches are operated in a decentralized, entrepreneurial manner with most offices operating as independent profit centers.

 

Sales and Marketing

 

Sales and marketing efforts are conducted at the local and national level through the Company’s network of branch offices. Business development and sales activities and productivity are tracked and rankings established and published. Sales between business units are recognized and financially encouraged. The Company emphasizes long-term relationships and partnerships with customers that are developed through regular assessment of customer requirements and proactive monitoring of service performance. The Company’s sales and account management personnel make regular visits to existing and prospective customers. New customers are obtained through active sales programs and referrals. The Company encourages its employees to participate in and support national and regional trade associations, economic development agencies, local chambers of commerce and other civic associations. The Company seeks to develop strategic partnering relationships with its customers by providing comprehensive solutions for all aspects of a customer’s operations, engineering, life sciences, information technology and other professional services needs. The Company concentrates on providing carefully screened professionals with a range of highly specialized and technical skills in a timely manner and at competitive prices. The Company regularly monitors the quality of the services provided by its personnel and obtains feedback from its customers as to their satisfaction with the services provided.

 

The Company serves Fortune 1000 companies and many middle market clients, competing on a national and global scale. The Company’s relationships with these customers are typically formed at the customers’ local or regional level and from time to time, when appropriate, at the corporate level for national accounts.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Key Customers

 

The Company has established long-term relationships with many of its customers across each of its business segments. The Company’s emphasis on client retention has resulted in repeat business from many of its largest strategic accounts. During the fiscal year ended December 28, 2024, the Company had two customers exceed 10% of consolidated revenue, representing 19.5% and 14.1% of consolidated revenue. The Company’s five, ten and twenty largest customers accounted for approximately 48.5%, 60.1% and 70.6%, respectively, of the Company’s revenue for the fiscal year ended December 28, 2024.

 

Other Information

 

Safeguards - Business, Disaster and Contingency Planning

The Company has implemented a number of safeguards to protect the Company from various system-related risks including Redundant Telecommunications and server systems architecture, multi-tiered server and desktop backup infrastructure, and data center physical and environmental controls. In addition, the Company has developed disaster recovery / business continuity procedures for all offices.

 

Given the significant amount of data generated in the Company’s key processes including recruiting, sales, payroll and customer invoicing, the Company has established redundant procedures, functioning on a daily basis, within the Company’s primary data center, which is a third-party Internet Data Center (“IDC”). This redundancy should mitigate the risks related to hardware, application and data loss by utilizing the concept of live differential backups of servers and desktops to Storage Area Network (SAN) devices on its backup LAN, culminating in offsite tape storage at an independent facility. Controls within the data center environment ensure that all systems are proactively monitored and data is properly archived.

 

Additionally, the Company has contracted and brokered strategic relationships with third-party vendors to meet its recovery objectives in the event of a system disruption. For example, comprehensive service level agreements for the Company’s data circuits and network devices guarantee minimal outages as well as network redundancy and scalability.

 

The Company’s ability to protect its data assets against damage from fire, power loss, telecommunications failures, and facility violations is critical. To address potential cyber security threats, the Company uses a third-party mail management service to filter all emails destined for the RCMT domain before being delivered to the corporate mail servers. The service has also been deployed to safeguard the enterprise from malicious internet content. The deployment of virus, spam, and patch management controls extends from the perimeter network to all desktops and is centrally monitored and managed. In addition to the virus and malware controls, an Intrusion Protection System (IPS) monitors and alerts on changes in network traffic patterns as well as known hostile signatures.

 

The Company maintains a disaster recovery plan that outlines the recovery time / point objectives (RTO / RPO), organization structure, roles and procedures, including site addendum disaster plans for all of its key operating offices.  Corporate IT personnel regulate the maintenance and integrity of backed-up data throughout the Company.

 

The IDC provides the Company with a robust data center environment with redundant HVAC, commercial power feeds, ten 2000kW diesel generator sets with five 10,000-gallon, above-ground fuel oil storage tanks to provide standby power and dry pipe fire suppression.  In addition, the IDC provides 24x7 security staffing, closed-circuit monitors, secure-card key access, biometrics scanners, man traps, and alarmed doors.  

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Competition

 

The market for Healthcare, Engineering and Life Sciences, Data and Solutions is highly competitive and is subject to rapid change. As the market demand has shifted, many software companies have adopted tactics to pursue services and consulting offerings making them direct competitors when in the past they may have been alliance partners. Primary competitors include participants from a variety of market segments, including publicly and privately held firms, systems consulting and implementation firms, application software firms, service groups of computer equipment companies, facilities management companies, general management consulting firms and staffing companies. In addition, the Company competes with its clients’ internal resources, particularly where these resources represent a fixed cost to the client. Such competition may impose additional pricing pressures on the Company.

 

The Company believes its principal competitive advantages in the healthcare, engineering and life sciences, data and solutions market include: strong relationships with existing clients, a long-term track record with over 1,000 clients, a broad range of services, technical expertise, knowledge and experience in multiple industry sectors, quality and flexibility of service, responsiveness to client needs and speed in delivering life sciences, data and solutions.

 

Additionally, the Company competes for suitable acquisition candidates based on its differentiated acquisition model, its entrepreneurial and decentralized operating philosophy, and its strong corporate-level support and resources.

 

Seasonality

 

The Company’s operating results can be affected by the seasonal fluctuations in client expenditures. Expenditures in the Engineering and Life Sciences, Data and Solutions segments can be negatively impacted during the first quarter of the year when clients are finalizing their budgets. Quarterly results generally fluctuate depending on, among other things, the number of billing days in a quarter and the seasonality of clients’ businesses. The business is also affected by the timing of holidays and seasonal vacation patterns, generally resulting in lower revenue and gross profit in the fourth quarter of each year, not considering any non-seasonal impact. Extreme weather conditions may also affect demand in the first and fourth quarters of the year as certain clients’ facilities are located in geographic areas subject to closure or reduced hours due to inclement weather. The Company generally experiences an increase in its cost of sales and a corresponding decrease in gross profit and gross margin percentage in the first and second fiscal quarters of each year as a result of resetting certain state and federal employment tax rates and related salary limitations. Also, the Company’s Specialty Health Care segment typically experiences a significant decline in revenue due to the substantial closure of one of its largest customers, the New York City Department of Education, and other educational institution clients during the third quarter due to their summer recess.

 

Government Regulations

 

The Company is a consulting firm and employment service provider and is generally subject to one or more of the following types of government regulation: (1) regulation of the employer/employee relationship between a firm and its employees, including tax withholding or reporting, social security or retirement, benefits, workplace compliance, wage and hour, anti-discrimination, immigration and workers’ compensation, (2) registration, licensing, record keeping and reporting requirements, and (3) federal contractor compliance. The Company believes it is in material compliance with all employee related statutes.

 

Intellectual Property

 

Management believes the RCM Technologies, Inc. name is extremely valuable and important to its business. The Company endeavors to protect its intellectual property rights and maintain certain trademarks, trade names, service marks and other intellectual property rights, including The Source of Smart Solutions® and Industries of Tomorrow, Today™ with a trademark application submitted for the use of the latter. The Company is not currently aware of any infringing uses or other conditions that would be reasonably likely to materially and adversely affect the Company’s use of its proprietary rights.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Human Capital

 

Our employees and contractors (together, our "workforce") are the Company's most valuable resource for current and future success.  We promote an environment that ensures safety, encourages diversity and inclusion, fosters growth and self-development, and provides meaningful work.  All employees participate in our success through attractive and aligned rewards.  Notable programs we offer to our full-time employees include:

 

●

Compensation packages that are market competitive, taking into account the location and responsibilities of the role;

●

The majority of full-time, salaried employees are eligible for incentive-based compensation such as performance bonuses and commissions;

●

High-quality employer-sponsored health insurance;

●

Access to numerous other employer-sponsored and employee-sponsored benefit plans;

●

Employer 401(k) matching contributions;

●

Employee stock purchase plan (at least a 15% discount to market value at the time of purchase)

 

Our recruiting teams use internal and external resources to recruit highly skilled and talented workers, and we encourage and reward workforce referrals for open positions.

 

In addition to our comprehensive investment in our workforce success, we strive to maintain an inclusive environment that values and leverages the uniqueness of each person to the benefit of all our stakeholders.  We view the combination of diverse perspectives and backgrounds as a powerful force for innovation.  To promote diversity and our core principles, we emphasize dignity, value, and equality of all members, regardless of race, color, religion, age, gender, or sexual orientation, through our actions and the workplace training programs we provide.  We continually strive to harness the diversity of our global workforce by cultivating a climate that permits all of our workforce to bring their authentic selves to work every day.

 

The health and safety of our workforce are also a top priority.  We have implemented appropriate procedures and precautions to ensure our workforce's continued safety and well-being.  We strive to comply with all federal and local workplace laws and regulations where we do business.  We are always looking for ways to exceed compliance standards by utilizing continuous improvement discipline to eliminate risks in the workplace proactively.

 

The Company believes promoting engagement and empowering its workforce drives better business results.  As a result, the Company believes it has an "open door" culture whereby every member of its workforce is comfortable expressing their ideas on improving the Company and its performance.  Our culture has resulted in action plans at all levels of the organization and drives continuous conversations on the things that matter most to our workforce and their teams.

 

The Company's employees and contractors are generally divided into four groups: 1) Nonbillable employees; 2) Billable salaried employees; 3) Billable hourly long-term employees; 4) Billable hourly short-term employees and contractors.

 

Nonbillable employees are primarily full-time and salaried.  These positions include but are not limited to executives, managers, general administration, finance, accounting, account managers, recruiters, credentialers, etcetera.  These employees are not billed to clients.  As of December 28, 2024, the Company employed approximately 370 nonbillable employees.  The expense for these employees is included in the Company's selling, general, and administrative expense in its income statements.

 

 

ITEM 1. BUSINESS (CONTINUED)

 

Billable salaried employees primarily include senior-level employees whose time is often billed to clients.  These employees tend to be long-term in nature.  Many are intended to produce high utilization rates (representing the percentage of their time billed to clients), often in the 90% to 100% range.  However, some have nonbillable responsibilities such as account management, client proposal preparation, general strategy formulation, expert content generation, project controls, overseeing projects where their time is not billable, supervising billable personnel, etcetera.  These employees' utilization rates generally range from 20% to 90%.  Most of the expense for billable salaried employees are included in the Company's direct costs in its income statements.

 

Billable hourly long-term employees have very high utilization, typically in the 90% to 100% range.  For most of these employees, our goal is near 100% utilization.  They are hired with the idea that we want them to work on multiple assignments, either in succession or simultaneously.  Billable hourly short-term employees have near 100% utilization.  They are typically hired for one assignment, and upon completion, they terminate.

 

As of December 28, 2024, our billable workforce comprised approximately 3,140 Specialty Health Care services personnel, 510 Engineering and Technical personnel, and 200 Life Sciences, Data and Solutions personnel assigned by the Company to work on client projects or assignments for various periods.  None of the Company's employees are party to a collective bargaining agreement.

 

The Company conducts business globally but is principally concentrated in North America, Europe and the Philippines. As of December 28, 2024, the Company's workforce breaks out as follows:

 

●

United States and Puerto Rico: approximately 250 nonbillable and 3,710 billable

●

International (Canada, Europe and the Philippines): approximately 120 nonbillable and 140 billable

 

Access to Company Information

 

The Company is a Nevada corporation organized in 1971. The address of its principal executive office is 2500 McClellan Avenue, Suite 350, Pennsauken, NJ 08109-4613.

 

The Company electronically files its annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports with the Securities and Exchange Commission (“SEC”). The SEC maintains an Internet site (http://www.sec.gov) that contains reports, proxies, information statements, and other information regarding issuers that file electronically.

 

The Company makes available on its website or by responding free of charge to requests addressed to the Company’s Corporate Secretary, its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports filed by the Company with the SEC pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended. These reports are available as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. The Company’s website is http://www.rcmt.com. The information contained on the Company’s website, or on other websites linked to the Company’s website, is not part of this document. Reference herein to the Company’s website is an inactive text reference only.

 

The Company has adopted a Code of Conduct applicable to all of its directors, officers and employees. In addition, the Company has adopted a Code of Ethics, within the meaning of applicable SEC rules, applicable to its Chief Executive Officer, Chief Financial Officer and Controller. Both the Code of Conduct and Code of Ethics are available, free of charge, by sending a written request to the Company’s Corporate Secretary. If the Company makes any amendments to either of these Codes (other than technical, administrative, or other non-substantive amendments), or waives (explicitly or implicitly) any provision of the Code of Ethics to the benefit of its Chief Executive Officer, Chief Financial Officer or Controller, it intends to disclose the nature of the amendment or waiver, its effective date and to whom it applies in the investor relations portion of the website, or in a report on Form 8-K filed with the SEC.

 

 

ITEM 1A. RISK FACTORS

 

The Company’s business involves a number of risks, some of which are beyond its control. The risk and uncertainties described below are not the only ones the Company faces. Set forth below is a discussion of the risks and uncertainties that management believes to be material to the Company.

 

Economic Trends

 

Adverse global economic conditions, when they occur, may create conditions such as increases in inflation, higher interest rates, a general tightening in the credit markets, lower levels of liquidity, increases in the rates of default and bankruptcy, and volatility in credit, equity and fixed income markets. Any or all of these developments can negatively affect the Company’s business, operating results or financial condition in a number of ways. For example, current or potential customers may be unable to fund capital spending programs, new product launches of other similar endeavors whereby they might procure services from the Company, and therefore delay, decrease or cancel purchases of services or not pay or delay paying for previously purchased services. In addition, these conditions may cause the Company to incur increased expenses or make it more difficult either to utilize existing debt capacity or otherwise obtain financing for operations, investing activities (including the financing of any future acquisitions), or financing activities, all of which could adversely affect the Company’s business, financial condition and results of operations.

 

Government Regulations

 

Staffing firms and employment service providers are generally subject to one or more of the following types of government regulation: (1) regulation of the employer/employee relationship between a firm and its employees, including tax withholding or reporting, social security or retirement, benefits, workplace compliance, wage and hour, anti-discrimination, immigration and workers’ compensation; (2) registration, licensing, record keeping and reporting requirements; and (3) federal contractor compliance. Failure to comply with these regulations could result in the Company incurring penalties and other liabilities, monetary and otherwise.

 

Highly Competitive Business

 

The staffing services and outsourcing markets are highly competitive and have limited barriers to entry. The Company competes in global, national, regional, and local markets with numerous temporary staffing and permanent placement companies. Price competition in the staffing industry is significant and pricing pressures from competitors and customers are increasing. In addition, there is increasing pressure on companies to outsource certain areas of their business to low cost offshore outsourcing firms. The Company expects that the level of competition will remain high in the future, which could limit the Company’s ability to maintain or increase its market share or profitability. Our inability to compete successfully with our competitors could adversely affect the Company’s business, financial condition and results of operations.

 

Seasonality of Business

 

As described in “Item 1. Business,” our operating results are subject to seasonal fluctuations, with reduced demand often occurring during the first quarter of the year when clients are finalizing their engineering and life sciences, data and solutions budgets, and also during periods in which there are a substantial amount of holidays and season vacations. In particular, one of the largest customers in our Specialty Health Care group, the New York City Department of Education, significantly reduces activity during the third quarter, when schools are closed for summer recess. Our operating results for any given period may fluctuate as a result of the timing of holidays, vacations and other events, and if we were to experience unfavorable performance during periods in which we would otherwise expect to have high seasonal demand, we may have limited ability to make up for such performance during periods of seasonally lower demand.

 

 

ITEM 1A. RISK FACTORS (CONTINUED)

 

Events Affecting Significant Customers

 

As disclosed in “Item 1. Business,” during the fiscal year ended December 28, 2024, the Company had two customers exceed 10% of consolidated revenue, representing 19.5% and 14.1% of consolidated revenue. The Company’s five, ten and twenty largest customers accounted for approximately 48.5%, 60.1% and 70.6%, respectively, of the Company’s revenue for the fiscal year ended December 28, 2024. The Company’s customers may be affected by the current state of the economy or developments in the credit markets or may engage in mergers or similar transactions. In addition, customers may choose to reduce the business they do with the Company for other reasons or no reason. The Company could also be materially impacted by actions of prime contractors whereby the Company derives revenue through a subcontractor relationship. Should any significant customers experience a downturn in their business that weakens their financial condition or merge with another company or otherwise cease independent operation, or limit their relationship with us, it is possible that the business that the customer does with the Company would be reduced or eliminated, which could adversely affect the Company’s business, financial condition and results of operations.

 

Subcontractors, Transit Accounts Receivable and Transit Accounts Payables Related to Construction Management Contracts

 

The Company’s Engineering segment has entered into arrangements to provide construction management and engineering services to customers under which arrangements the Company then engages subcontractors to provide the construction services. Ultimately, as a primary contractor, the Company is responsible for the nonperformance or negligence of its subcontractors, whom the Company requires to be adequately insured and to issue performance bonds for their assignment. Should a subcontractor not perform or act negligently and should there be inadequate insurance or performance bonds in place, the Company might not be able to mitigate its primary liability to the customer, and the Company’s business, financial condition and results of operations could be materially adversely affected. In addition, while payments to subcontractors typically are due from the Company only after the Company receives payment from the ultimate customer, the Company faces the risk that, should a customer not pay the Company, or should a subcontractor demand payment from the Company prior to the Company’s receipt of payment from its customer, the Company’s business, financial condition and results of operations could be materially adversely affected.

 

Dependence Upon Personnel

 

The Company’s operations depend on the continued efforts of its officers and other executive management. The loss of key officers and members of executive management may cause a significant disruption to the Company’s business.

 

The Company also depends on the performance and productivity of its local managers and field personnel. The Company’s ability to attract and retain new business is significantly affected by local relationships and the quality of service rendered. The loss of key managers and field personnel may also jeopardize existing client relationships with businesses that continue to use the Company’s services based upon past relationships with local managers and field personnel. In order to fulfill the requirements of the Company’s customers, the Company must be able to recruit and retain appropriate personnel for client assignments.

 

 

ITEM 1A. RISK FACTORS (CONTINUED)

 

Revolving Credit Facility and Liquidity

 

If the Company were unable to borrow under its Revolving Credit Facility (see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – Financing Activities”), it may adversely affect the Company’s liquidity, results of operations and financial condition. The Company’s liquidity depends on its ability to generate sufficient cash flows from operations and, from time to time, borrowings under the Revolving Credit Facility with the Company’s agent lender Citizens Bank of Pennsylvania. The Company believes that Citizens Bank is liquid and is not aware of any current risk that they will become illiquid.  However, should Citizens Bank experience limitations on its liquidity, our access to capital and thus our own liquidity could be adversely affected.  At December 28, 2024, the Company had $35.0 million in borrowings under the Revolving Credit Facility outstanding and $7.4 million outstanding under letters of credit, with availability for additional borrowings under the Revolving Credit Facility of $22.6 million.

 

Borrowings under the Revolving Credit Facility bear interest at one of two alternative rates, as selected by the Company at each incremental borrowing.  These alternatives are: (i) SOFR (Secured Overnight Financing Rate), plus applicable margin or (ii) the agent bank’s prime rate generally borrowed over shorter durations.  The Company also pays unused line fees based on the amount of the Revolving Credit Facility that is not drawn.  Unused line fees are recorded as interest expense.

 

All borrowings under the Fifth Amended and Restated Loan Agreement remain collateralized with substantially all of the Company’s assets, as well as the capital stock of its subsidiaries. The Revolving Credit Facility also contains various financial and non-financial covenants, such as a covenant that restricts the Company’s ability to borrow in order to pay dividends. As of December 28, 2024, the Company was in compliance with all covenants contained in the Revolving Credit Facility. The Company believes that it will maintain compliance with its financial covenants for the foreseeable future.

 

Foreign Currency Fluctuations and Changes in Exchange Rates

 

The Company is exposed to risks associated with foreign currency fluctuations and changes in exchange rates. The Company’s exposure to foreign currency fluctuations relates to operations in Canada, Germany and Serbia, principally conducted through its Canadian, German and Serbian subsidiaries. Exchange rate fluctuations affect the United States dollar value of reported earnings derived from the foreign operations as well as the carrying value of the Company’s investment in the net assets related to these operations. The Company does not engage in hedging activities with respect to foreign operations.

 

Changes in Tax Laws

 

At any time, United States federal tax laws or the administrative interpretations of those laws may be changed. As a result, changes in United States federal tax laws could negatively impact our operating results, financial condition and business operations, and adversely impact the Company’s shareholders. At any time, tax laws in the Company’s other jurisdictions, Canada, Germany, Philippines, Puerto Rico and Serbia, may also change. These tax law changes may have a material impact on the Company’s income tax expense.

 

Workers’ Compensation and Employee Medical Insurance

 

The Company self-insures a portion of the exposure for losses related to workers’ compensation and employees’ medical insurance. The Company has established reserves for workers’ compensation and employee medical insurance claims based on historical loss statistics and periodic independent actuarial valuations. Significant differences in actual experience or significant changes in assumptions may materially affect the Company’s future financial results.

 

 

ITEM 1A. RISK FACTORS (CONTINUED)

 

Improper Activities of Temporary Professionals Could Result in Damage to Business Reputation, Discontinuation of Client Relationships and Exposure to Liability

 

The Company may be subject to claims by clients related to errors and omissions, misuse of proprietary information, discrimination and harassment, theft and other criminal activity, malpractice, and other claims stemming from the improper activities or alleged activities of temporary professionals. There can be no assurance that current liability insurance coverage will be adequate or will continue to be available in sufficient amounts to cover damages or other costs associated with such claims.

 

Claims raised by clients stemming from the improper actions of temporary professionals, even if without merit, could cause the Company to incur significant expense associated with rework costs or other damages related to such claims. Furthermore, such claims by clients could damage the Company’s business reputation and result in the discontinuation of client relationships.

 

Acquisitions May Not Succeed

 

The Company reviews prospective acquisitions as an element of its growth strategy. The failure of any acquisition to meet the Company’s expectations, whether due to a failure to successfully integrate any future acquisition or otherwise, may result in damage to the Company’s financial performance and/or divert management’s attention from its core operations or could negatively affect the Company’s ability to meet the needs of its customers promptly.

 

International Operations

 

The Company operates its business in Canada, Germany, Philippines, Puerto Rico and Serbia. For the fiscal year ended December 28, 2024, approximately 7.8% of the Company’s revenue were generated outside the United States. There are certain risks inherent in conducting business internationally including: the imposition of trade barriers, the enactment of tariffs, foreign exchange restrictions, longer payment cycles, greater difficulties in accounts receivables collection, difficulties in complying with a variety of foreign laws (including without limitation the U.S. Foreign Corrupt Practices Act), changes in legal or regulatory requirements, including as to laws and regulations governing economic and trade sanctions, difficulties in staffing and managing foreign operations, complex and uncertain employment environments, political instability and potentially adverse tax consequences.  Our operations in Serbia could be adversely affected by the current conflict between Ukraine and Russia, with which Serbia has substantial ties.  Should sanctions against Russia affect Russia in a way that causes adverse economic consequences to Serbia, or if such sanctions were to be extended to countries that might be considered to be in alignment with Russia, this could have a negative impact on our employees or operations both within and outside Serbia. To the extent the Company experiences these risks, the business and results of operations could be adversely affected.

 

Tariffs or Other Restrictions Imposed on Foreign Imports by the U.S. and Related Countermeasures

 

If significant tariffs or other restrictions are imposed on foreign businesses by the U.S. and related countermeasures are taken by impacted foreign countries, our business and results of operations could be adversely affected. During the first months of President Trump's second term, the U.S. announced the imposition of additional substantial tariffs on imports from various countries, including China, Canada and Mexico, and the subject countries indicated their intention to impose counter measures. Factors relating to these disputes could reduce demand for our services, result in the loss of customers and harm our competitive position in key markets. Additionally, ongoing trade tensions and uncertainty regarding future trade policies could negatively impact global economic conditions and consumer confidence, further affecting our business and results of operations.

 

 

ITEM 1A. RISK FACTORS (CONTINUED)

 

Global Epidemics

 

As was the case with the COVID-19 pandemic and endemic, and associated initiatives to reduce its spread, any other global pandemics or endemics that may occur in the future could adversely affect the Company’s business and financial position. For example, public and private sector policies and initiatives to reduce the transmission of a highly transmissible disease, such as closures of schools, businesses and manufacturing facilities, the promotion of social distancing, the adoption of working from home by companies and institutions, and travel restrictions could adversely affect demand for our services and present challenges to us in delivering these services.  These impacts on our business could have an adverse effect on our liquidity position and access to capital, including our ability to access our line of credit.

 

These factors, in addition to delays in payment, could continue result in significant bad debts in the near future. Additionally, our operating results would be adversely affected if unexpected increases in the costs of labor and labor related costs, materials, supplies and equipment used in performing services could not be passed on to our clients. In addition, we believe that to maintain or improve our financial performance we must continue to obtain service agreements with new clients, retain and provide new services to existing clients, achieve modest price increases on current service agreements with existing clients and/or maintain internal cost reduction strategies at our various operational levels. Furthermore, we believe that our ability to sustain the internal development of managerial personnel is an important factor impacting future operating results and the successful execution of our projected growth strategies.  A future pandemic could make these objective more difficult to attain.

 

Trademarks

 

Management believes the RCM Technologies, Inc. name is extremely valuable and important to its business. The Company endeavors to protect its intellectual property rights and maintain certain trademarks, trade names, service marks and other intellectual property rights, including The Source of Smart Solutions® and Industries of Tomorrow, Today™ with a trademark application submitted for the use of the latter. The Company is not currently aware of any infringing uses or other conditions that would be reasonably likely to materially and adversely affect the Company’s use of its proprietary rights. The Company’s success depends on its ability to successfully obtain and maintain, and prevent misappropriation or infringement of, its intellectual property, maintain trade secret protection, and conduct operations without violating or infringing on the intellectual property rights of third parties. Intellectual property litigation is expensive and time-consuming, and it is often difficult, if not impossible, to predict the outcome of such litigation. If the Company is involved in intellectual property litigation, its business, financial condition and results of operations could be materially adversely affected.

 

Data Center Capacity and Telecommunication Links

 

Uninterruptible Power Supply (UPS), card key access, fire suppression, and environmental control systems protect the Company’s datacenter.  All systems are monitored on a 24/7 basis with alerting capabilities via voice or email.  The telecommunications architecture at the Company utilizes managed private circuits from AT&T, which encompasses provisioning redundancy and diversity.

 

The Company’s ability to protect its data center against damage from fire, power loss, telecommunications failure and other disasters is critical to business operations.  In order to provide many of its services, the Company must be able to store, retrieve, process and manage large databases and periodically expand and upgrade its capabilities.  Any damage to the Company’s data centers or any failure of the Company’s telecommunication links that interrupts its operations or results in an inadvertent loss of data could adversely affect the Company’s ability to meet its customers’ needs and their confidence in utilizing the Company for future services.

 

The Company’s ability to protect its data, provide services and safeguard its installations, as it relates to the IT infrastructure, is in part dependent on several outside vendors with whom the Company maintains service level agreements.

 

 

ITEM 1A. RISK FACTORS (CONTINUED)

 

Cyber Security

 

We are highly dependent on information technology systems to operate our business. A breakdown, invasion, corruption, destruction or interruption of critical information technology systems by employees, others with authorized access to our systems or unauthorized persons could negatively impact operations. In the ordinary course of business, we collect, store and transmit confidential information and it is critical that we do so in a secure manner to maintain the confidentiality and integrity of such information. Additionally, we outsource certain elements of our information technology systems to third parties. As a result of this outsourcing, our third party vendors may or could have access to our confidential information making such systems vulnerable. Data breaches of our information technology systems, or those of our third party vendors, may pose a risk that sensitive data may be exposed to unauthorized persons or to the public.

 

We have experienced cybersecurity events and disruptions such as viruses and attacks targeting our information technology systems. Such prior events have not had a material impact on our financial condition, results of operations or liquidity. However, future threats could have a materially adverse impact on our company by, among other things, causing harm to our business, financial condition, results of operations or reputation; disrupting our operations; exposing us to potential liability, regulatory actions and loss of business; and challenging our eligibility for future work on sensitive systems. Due to the evolving nature of these security threats, the potential impact of any future incident cannot be predicted. Our insurance coverage may not be adequate to cover all the costs related to cybersecurity attacks or disruptions resulting from such events.

 

While we believe that we have taken appropriate security measures to protect our data and information technology systems and have been informed by our third party vendors that they have as well, there can be no assurance that our efforts will prevent breakdowns or breaches in our systems, or those of our third party vendors, that could adversely affect our business.

 

Environmental Matters and Climate Change

 

The Company and many of its customers are subject to regulation by federal, state and international environmental laws, including those relating to climate change, that are subject to rapid change, which could result in regulatory uncertainty as well as potential significant increases in compliance costs. There can be no assurance that the steps we take to abide by applicable requirements will meet all current and future regulatory. Any failures to do so could result in governmental enforcement actions, fines, and other penalties, or other liabilities, that could adversely affect our business.

 

Data Privacy

 

We control, process, or have access to personal information regarding our own employees or employment candidates, as well as that of many of our customers or other third parties. Information concerning these individuals may also reside in systems controlled by third party vendors with whom we do business. The legal and regulatory environment concerning data privacy is becoming more complex and challenging, and the potential consequences of non-compliance have become more severe. The European Union’s General Data Protection Regulation, the California Consumer Privacy Act, the Health Insurance Portability and Accountability Act of 1996 and similar laws impose additional compliance requirements related to the collection, use, processing, transfer, disclosure, and retention of personal information, which can increase operating costs and resources to accomplish. Any failure to abide by these regulations or to protect such personal information from inappropriate access or disclosure, whether through social engineering or by accident or other cause, could have severe consequences including fines, litigation, regulatory sanctions, reputational damage, and loss of customers or employees. There can be no assurance that the steps we take to abide by applicable requirements and protect information will meet all current and future regulatory requirements, anticipate all potential methods of unauthorized access, or prevent all inappropriate disclosures. Any failures to do so could result in governmental enforcement actions, fines, and other penalties, or other liabilities, that could adversely affect our business.

 

 

ITEM 1B. UNRESOLVED STAFF COMMENTS

 

Not applicable.

 

 

ITEM 1C. CYBERSECURITY

 

Cybersecurity Risk Management and Strategy

 

The Company has developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of its critical systems and information. The Company’s cybersecurity risk management program includes a cybersecurity incident response plan and is integrated with the Company’s overall enterprise risk management program, sharing common methodologies, reporting channels and governance processes that apply across the enterprise risk management program to other legal, compliance, strategic, operational and financial risk areas. While the Company may not meet any particular standard, specification or requirement of the Center for Internet Security Critical Security Controls, the Company utilizes such controls as a guide to help identify, assess and manage cybersecurity risks relevant to the business. The Company has implemented cybersecurity policies and frameworks based on industry and governmental standards to align closely with requirements, instructions, and guidance from ISO27001, NIST, CMMC, GDPR, HIPAA, SOC and SOX Compliance.

 

Our cybersecurity risk management program includes, among other things:

 

●

risk assessments designed to help identify material cybersecurity risks to critical systems and information services;

●

a team comprising information technology (IT) security, IT infrastructure, and IT compliance personnel principally responsible for directing (i) cybersecurity risk assessment processes, (ii) security processes and (iii) planned responses to cybersecurity incidents;

●

the use of external cybersecurity service providers, where appropriate, to assess, test or otherwise assist with aspects of security processes;

●

cybersecurity awareness training of employees with access to IT systems;

●

a cybersecurity incident response plan and Security Operations Center to respond to cybersecurity incidents; and

●

a third-party risk management process for service providers.

 

During the year ended December 28, 2024, the Company has not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected operations, business strategy, results of operations or financial condition. However, the Company expects to continue to face certain risks from ongoing cybersecurity threats that, if realized, are reasonably likely to materially affect the Company, including our operations, business strategy, results of operations or financial condition. See Risk Factors – Cyber Security, Data Privacy and Data Center Capacity and Telecommunication Links.

 

21

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ITEM 1C. CYBERSECURITY (CONTINUED)

 

Cybersecurity Governance

 

The Company’s Board considers cybersecurity risk as part of its risk oversight function and considers cybersecurity and IT risks as key strategic risks of the Company. The Board oversees management’s implementation of the Company’s cybersecurity risk management program, receiving at least annual updates from management (including our Chief Information Officer) on cybersecurity risks, including briefings on the Company’s cyber risk management program and cybersecurity incidents, and reviewing cybersecurity topics impacting companies with management and external experts.

 

The Company’s Chief Information Officer leads the IT and cybersecurity functions and has primary responsibility for leading the Company’s overall cybersecurity risk management program, supervising both internal cybersecurity personnel and external cybersecurity service providers. The Company’s cybersecurity function is responsible for assessing and managing material risks from cybersecurity threats, as well as informing management about and monitoring the prevention, detection, mitigation, and remediation of cybersecurity risks and incidents through various means, which include briefings with internal security personnel, threat intelligence and other information obtained from governmental, public or private sources, including external cybersecurity service providers and alerts and reports produced by security tools deployed in the IT environment.

 

The Company’s Chief Information Officer and Vice President of IT security and Compliance have significant experience in managing and leading information systems and deploying cybersecurity technologies and have extensive cybersecurity training and knowledge. The Company’s Vice President of IT security and Compliance has several industry certifications, including CISSP (Certified Information Security System Professional), CCSP (Certified Cloud Security Professional) and CCSK (Certificate of Cloud Security Knowledge). The Company’s Chief Information Officer reports to the Chief Executive Officer, and the Company’s Vice President of IT Security and Compliance reports to the Company’s Chief Information Officer.

 

 

ITEM 2. PROPERTIES

 

The Company provides specialty professional consulting services, principally performed at various client locations, through 27 administrative and sales offices located in the United States, Puerto Rico, Canada, Germany and Serbia. The majority of the Company’s offices typically consist of 1,000 to 15,000 square feet and are typically leased by the Company for terms of one to five years. Offices in larger or smaller markets may vary in size from the typical office. The Company does not expect that it will be difficult to maintain or find suitable lease space at reasonable rates in its markets or in areas where the Company contemplates expansion.

 

The Company’s corporate office is located at 2500 McClellan Avenue, Suite 350, Pennsauken, New Jersey 08109-4613. These premises consist of approximately 3,500 square feet and are leased at a rate of approximately $15.00 per square foot per annum for a term ending on November 30, 2025.

 

 

ITEM 3. LEGAL PROCEEDINGS

 

From time to time, the Company is a defendant in various legal actions that arise in the ordinary business course.  These matters may relate to professional liability, tax, compensation, contract, competitor disputes, and employee-related matters and include individual and class action lawsuits, as well as inquiries and investigations by governmental agencies regarding the Company’s employment and compensation practices. Additionally, some of the Company’s clients may also become subject to claims, governmental inquiries and investigations, and legal actions relating to the Company’s professional services. Depending upon the particular facts and circumstances, the Company may also be subject to indemnification obligations under its contracts with such clients relating to these matters.

 

As such, the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of losses and possible recoveries.  The Company may not be covered by insurance as it pertains to some or all of these matters.  A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter.  The Company records a liability when management believes an adverse outcome from a loss contingency is both probable and the amount, or a range, can be reasonably estimated. From time to time, the Company must estimate the potential loss even though the party adverse to the Company has not asserted any specific amounts. Significant judgment is required to determine both the probability of loss and the estimated amount. The Company reviews its loss contingencies at least quarterly and it adjusts its accruals and/or disclosures to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, or other new information, as deemed necessary. Once established, a provision may change in the future due to new developments or changes in circumstances. The Company could increase or decrease its earnings in the period that the changes are made. 

 

The Company is exposed to various asserted claims as of December 28, 2024, where the Company believes it has a probability of loss. Additionally, the Company is exposed to other asserted claims whereby an amount of loss has not been declared, and the Company cannot determine the potential loss. Any of these various claims could result in an unfavorable outcome or settlement that exceeds the accrued amounts. However, the Company believes that such matters will not, either individually or in the aggregate, have a material adverse effect on its business, consolidated financial position, results of operations, or cash flows. As of December 28, 2024, the Company has accrued $2.8 million for asserted claims. 

 

In April 2022, a client of the Company’s Engineering segment alleged that a system partially designed by the Company is not operating as intended and that the Company is responsible. The Company has not determined if it has any liability. In the event of liability, the Company believes its damages are contractually limited to an amount no higher than $3.3 million. Furthermore, the Company believes that if it were found liable, any damages would be covered by insurance, subject to a deductible of $0.5 million and maximum coverage of $5.0 million. While the clients estimated damages are not known, the client has either inferred or asserted during settlement discussions that it’s damages significantly exceed the Company’s insurance coverage of $5 million. While the Company attempts to find a mutually agreeable solution, the Company has reserved $0.5 million for this project. The Company can give no assurance that its liability is limited to $3.3 million or that liability over $0.5 million, if any, will be covered by insurance.

 

The Company is also subject to other pending legal proceedings and claims that arise from time to time in the ordinary course of its business, which may not be covered by insurance.

 

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

 

PART II

 

 

ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER
	MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 

Shares of the Company’s common stock are traded on The NASDAQ Global Market under the Symbol “RCMT.”

 

Holders

 

As of February 20, 2025, the approximate number of holders of record of the Company’s Common Stock was 223. Since certain of our shares are held by brokers and other institutions on behalf of shareholders, the foregoing number is not representative of the number of beneficial owners.

 

Dividends

 

No dividends were declared in fiscal 2023 or fiscal 2024.  All restricted share awards contain a dividend equivalent provision entitling holders to dividends paid between the restricted stock award grant date and ultimate share distribution date.  As of December 28, 2024, there were no accrued dividends.

 

While the Company, at this time, has no plans to issue any future dividends, any future payment of dividends will depend upon, among other things, the Company’s earnings, financial condition, capital requirements, level of indebtedness, contractual restrictions, and other factors that the Board of Directors deems relevant.  The Revolving Credit Facility (as discussed in Item 7 hereof) prohibits the payment of any dividends or distributions on account of the Company’s capital stock without the prior consent of the majority of the Company’s lenders. 

 

Stock Repurchase by Issuer

 

On March 29, 2024, the Board authorized a program to repurchase shares of its common stock up to an amount not to exceed $50.0 million, inclusive of amounts remaining under the existing repurchase authorization. The program (the Treasury Stock Repurchase Plan) is designed to provide the Company with enhanced flexibility over the long term to optimize its capital structure.  Shares of the common stock may be repurchased in the open market or through negotiated transactions.  The program may be terminated or suspended at any time at the discretion of the Company. The Company may enter into a Rule 10b5-1 trading plan to effect a portion of the authorized purchases if the criteria set forth in the plan are met. Such a plan would enable the Company to repurchase its shares during periods outside of its normal trading windows when the Company typically would not be active in the market.

 

There were no repurchased shares from September 29, 2024 through December 28, 2024.

 

 

ITEM 6.

[RESERVED]

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

The following discussion and analysis contains forward-looking statements, including, without limitation, statements relating to our plans, strategies, objectives, expectations, intentions and resources. Such forward-looking statements should be read in conjunction with our disclosures under “Item 1A. Risk Factors” of this Form 10-K.

 

This section of the Form 10-K generally discusses matters relating to the fiscal years ended December 28, 2024 and December 30, 2023 and year-to-year comparisons between such fiscal years. Discussions of matters relating to the fiscal year ended December 31, 2022 and year-to-year comparison between that year and the year ended December 30, 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 30, 2023.

 

Overview

 

RCM participates in a market that is cyclical in nature and sensitive to economic changes. As a result, the impact of economic changes on revenue and operations can be substantial, resulting in significant volatility in the Company’s financial performance.

 

The Company believes it has developed and assembled an attractive portfolio of capabilities, established a proven record of performance and credibility and built an efficient pricing structure. The Company is committed to optimizing its business model as a single-source premier provider of business and technology solutions with a strong vertical focus offering an integrated suite of services through a global delivery platform.

 

The Company believes that most companies recognize the importance of advanced technologies and business processes to compete in today’s business climate. However, the process of designing, developing and implementing business and technology solutions is becoming increasingly complex. The Company believes that many businesses today are focused on return on investment analysis in prioritizing their initiatives. This has had an adverse impact on spending by current and prospective clients for many emerging new solutions.

 

Nonetheless, the Company continues to believe that businesses must implement more advanced life sciences, information technology and engineering solutions to upgrade their systems, applications and processes so that they can maximize their productivity and optimize their performance in order to maintain a competitive advantage. Although working under budgetary, personnel and expertise constraints, companies are driven to support increasingly complex systems, applications and processes of significant strategic value. This has given rise to a demand for outsourcing. The Company believes that its current and prospective clients are continuing to evaluate the potential for outsourcing business critical systems, applications and processes.

 

The Company provides project management and consulting services, which are billed based on either agreed-upon fixed fees or hourly rates, or a combination of both. The billing rates and profit margins for project management and solutions services are generally higher than those for professional consulting services. The Company generally endeavors to expand its sales of higher margin solutions and project management services. The Company also realizes revenue from client engagements that range from the placement of contract and temporary technical consultants to project assignments that entail the delivery of end-to-end solutions. These services are primarily provided to the client at hourly rates that are established for each of the Company’s consultants based upon their skill level, experience and the type of work performed.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Overview (Continued)

 

The majority of the Company’s services are provided under purchase orders. Contracts are utilized on certain of the more complex assignments where the engagements are for longer terms or where precise documentation on the nature and scope of the assignment is necessary. Although contracts normally relate to longer-term and more complex engagements, they do not obligate the customer to purchase a minimum level of services and are generally terminable by the customer on 60 to 90 days’ notice. The Company, from time to time, enters into contracts requiring the completion of specific deliverables. Typically, these contracts are for less than one year.  The Company recognizes revenue on these deliverables at the time the client accepts and approves the deliverables.

 

Costs of services consist primarily of salaries and compensation-related expenses for billable consultants and employees, including payroll taxes, employee benefits and insurance. Selling, general and administrative expenses consist primarily of salaries and benefits of personnel responsible for business development, recruiting, operating activities, and training, and include corporate overhead expenses. Corporate overhead expenses relate to salaries and benefits of personnel responsible for corporate activities, including the Company’s corporate marketing, administrative and financial reporting responsibilities and acquisition program. The Company records these expenses when incurred. Corporate overhead expenses are allocated to the segments based on revenue for the purpose of segment financial reporting.

 

Critical Accounting Policies and Use of Estimates

 

This Management's Discussion and Analysis of Financial Condition and Results of Operations is based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period. In our consolidated financial statements, estimates are used for, but not limited to, accounts receivable and provision for credit losses, goodwill, long-lived intangible assets, accounting for stock options and restricted stock awards, insurance liabilities, accounting for income taxes and accrued bonuses.

 

Revenue Recognition

 

The Company records revenue under Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. Revenue is recognized when we satisfy a performance obligation by transferring services promised in a contract to a customer, in an amount that reflects the consideration that we expect to receive in exchange for those services. Performance obligations in our contracts represent distinct or separate service streams that we provide to our customers.

 

We evaluate our revenue contracts with customers based on the five-step model under ASC 606: (1) Identify the contract with the customer; (2) Identify the performance obligations in the contract; (3) Determine the transaction price; (4) Allocate the transaction price to separate performance obligations; and (5) Recognize revenue when (or as) each performance obligation is satisfied.

 

The Company derives its revenue from several sources. The Company’s Engineering Services and Life Sciences, Data and Solutions segments perform consulting and project solution services. The Healthcare segment specializes in long-term and short-term staffing and placement services to hospitals, schools and long-term care facilities amongst others. All of the Company’s segments perform staff augmentation services and derive revenue from permanent placement fees.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Revenue Recognition (Continued)

 

The following table presents our revenue disaggregated by revenue source for the fiscal years ended December 28, 2024 and December 30, 2023:

 

		December 28, 2024				December 30, 2023
Specialty Health Care:
Time and Material		$	141,185			$	134,941
Permanent Placement Services			1,494				1,300
Total Specialty Health Care		$	142,679			$	136,241
Engineering:
Time and Material		$	47,157			$	42,443
Fixed Fee			49,302				42,232
Permanent Placement Services			-				-
Total Engineering		$	96,459			$	84,675
Life Sciences, Data and Solutions:
Time and Material		$	30,547			$	35,368
Fixed Fee			8,452				6,551
Permanent Placement Services			243				402
Total Life Sciences, Data and Solutions		$	39,242			$	42,321
		$	278,380			$	263,237

 

Time and Material

 

The Company’s Health Care segment predominantly recognizes revenue through time and material work while its Engineering and Life Sciences, Data and Solutions segments recognize revenue through both time and material and fixed fee work. The Company’s time and material contracts are typically based on the number of hours worked at contractually agreed upon rates, therefore revenue associated with these time and materials contracts are recognized based on hours worked at contracted rates. 

 

Fixed Fee

 

From time to time and predominantly in our Engineering segment, the Company enters into contracts requiring the completion of specific deliverables.  The Company has master services agreements with many of its customers that broadly define terms and conditions. Actual services performed under fixed fee arrangements are typically delivered under purchase orders that more specifically define terms and conditions related to that fixed fee project. While these master services agreements can often span several years, the Company’s fixed fee purchase orders are typically performed over six to nine month periods.  In instances where project services are provided on a fixed-price basis, revenue is recorded in accordance with the terms of each contract.  For engineering contracts estimated costs are budgeted by project, the Company then recognizes revenue by applying the costs incurred to date against the total budgeted costs and applying the percentage of completed cost against the total contract value to recognize revenue for each period.  In certain instances, revenue is invoiced at the time certain milestones are reached, as defined in the contract.  Revenue under these arrangements are recognized as the costs on these contracts are incurred.  From time-to-time, amounts paid in excess of revenue earned and recognized are recorded as deferred revenue.  Some contracts also limit revenue and billings to specified maximum amounts.  Provisions for contract losses, if any, are made in the period such losses are determined.  For contracts where there is a specific deliverable and the work is not complete and the revenue is not recognized, the costs incurred are deferred as a prepaid asset.  The associated costs are expensed when the related revenue is recognized.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Revenue Recognition (Continued)

 

Permanent Placement Services

 

The Company earns permanent placement fees from providing permanent placement services. These fees are typically based on a percentage of the compensation paid to the person placed with the Company’s client. The Company guarantees its permanent placements on a prorated basis for 90 days. In the event a candidate is not retained for the 90-day period, the Company will provide a suitable replacement candidate. In the event a replacement candidate cannot be located, the Company will provide a prorated refund to the client. An allowance for refunds, based upon the Company’s historical experience, is recorded in the financial statements.

 

Deferred Revenue

 

Deferred revenue was $4.2 million as of December 28, 2024 and $1.9 million as of December 30, 2023. Revenue is recognized when the service has been performed. Deferred revenue may be recognized over a period exceeding one year from the time it was recorded on the balance sheet, although this is an infrequent occurrence. In the fiscal years ended December 28, 2024 and December 30, 2023, the Company recognized revenue of $1.9 million and $1.1 million, respectively, that was included in deferred revenue at the beginning of the reporting period.

 

Accounts Receivable and Provision for Credit Losses

 

The Company’s accounts receivable are primarily due from trade customers. Credit is extended based on evaluation of customers’ financial condition and, generally, collateral is not required. Accounts receivable payment terms vary and are stated in the financial statements at amounts due from customers net of a provision for credit losses. Accounts outstanding longer than the payment terms are considered past due. The Company determines its provision by considering a number of factors, including the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. The Company writes off accounts receivable when they become uncollectible, and payments subsequently received on such receivables previously written off are credited to bad debt expense.

 

Goodwill

 

Goodwill is not amortized but is subject to periodic testing for impairment in accordance with ASC Topic 350 “Intangibles - Goodwill and Other - Testing Indefinite-Lived Intangible Assets for Impairment” (“ASC Topic 350”). The Company tests goodwill for impairment on an annual basis as of the last day of the Company’s fiscal December each year or more frequently if events occur or circumstances change indicating that the fair value of the goodwill may be below its carrying amount. The Company has three reporting units. The Company uses a market-based approach to determine the fair value of the reporting units. This approach uses earnings/revenue multiples of similar companies recently completing acquisitions and the ability of our reporting units to generate cash flows as measures of fair value of our reporting units. The Company follows “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which has eliminated Step 2 from the goodwill impairment test. Under this update, an entity should perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Goodwill (Continued)

 

There was no goodwill impairment in fiscal 2024 or 2023.  The Company reviewed industry and market conditions, reporting unit specific events as well as overall financial performance and determined that no indicators of impairment of goodwill existed in its Engineering and Specialty Health Care segments during the fiscal year ended December 28, 2024 and for all segments during the year ended December 30, 2023.  With respect to the fiscal year ended December 28, 2024, since the Company remeasured contingent consideration associated with its Life Sciences, Data and Solutions segment, the Company determined that further testing was necessary. After comparing the fair value of the Life Sciences, Data and Solutions segment to its carrying amount, the Company determined that no impairment loss occurred for the Company’s goodwill related to that segment during the fiscal years ended December 28, 2024 or December 30, 2023. Except for the aforementioned remeasurement of contingent consideration, the Company determined that the existing qualitative factors did not suggest that an impairment of goodwill exists.  There can be no assurance that future indicators of impairment and tests of goodwill impairment will not result in impairment charges for both its Engineering and Specialty Healthcare segments.

 

Long-Lived and Intangible Assets

 

The Company evaluates long-lived assets and intangible assets with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When the Company determines that it is probable that undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. Assets to be disposed of by sale, if any, are reported at the lower of the carrying amount or fair value less cost to sell.

 

Accounting for Restricted Stock Awards

 

The Company uses restricted stock awards to attract, retain and reward employees for long-term service. The Company follows Financial Accounting Standards Board (FASB), Accounting Standards Codification (ASC) Topic 718 “Compensation – Stock Compensation” which requires that the compensation cost relating to stock-based payment transactions be recognized in the financial statements. This compensation cost is measured based on the fair value of the equity or liability instruments issued. The Company measures stock-based compensation cost using the Black-Scholes option pricing model for stock options and the fair value of the underlying common stock at the date of grant for restricted stock awards.

 

Insurance Liabilities

 

The Company has risk participation arrangements with respect to workers compensation and healthcare insurance. The Company establishes loss provisions based on historical experience and in the case of expected losses from workers compensation, considers input from third parties. The amounts included in the Company’s costs related to this risk participation are estimated and can vary based on changes in assumptions, the Company’s claims experience or the providers included in the associated insurance programs.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Accounting for Income Taxes

 

In establishing the provision for income taxes and deferred income tax assets and liabilities and valuation allowances against deferred tax assets, the Company makes judgments and interpretations based on enacted tax laws, published tax guidance and estimates of future earnings.  As of December 28, 2024, the Company had both domestic and foreign net deferred tax liabilities of $4.4 million.  The domestic long term net deferred tax liability of $4.5 million includes $7.6 million in deferred liabilities offset by $3.0 million in deferred tax assets. The deferred tax liabilities consist of acquisition amortization of $4.3 million, prepaid expenses of $1.1 million, advance depreciation deductions of $0.9 million and right of use assets of $1.2 million.  The domestic deferred tax assets consist of lease liabilities of $1.3 million, reserves and accruals of $0.5 million, compensation of $0.8 million and provision for credit losses of $0.4 million. The realization of deferred tax assets is dependent upon the likelihood that future taxable income will be sufficient to realize these benefits over time, and the effectiveness of tax planning strategies in the relevant tax jurisdictions.  If actual results differ from these estimates and assessments, valuation allowances may be required.  As of December 28, 2024, the Company had no foreign deferred tax balances associated with its Canadian operations and a deferred tax asset of $0.1 million associated with its German operations.

 

The Company conducts its operations in multiple tax jurisdictions in the United States, Canada, Germany, Philippines, Puerto Rico and Serbia. The Company and its subsidiaries file a consolidated United States Federal income tax return and file in various states. The Company has no open Federal audits as of December 28, 2024. Except for limited exceptions, the Company is no longer subject to audits by state and local tax authorities for tax years prior to 2020. The Company is no longer subject to audit in Canada for the tax years prior to tax year 2020. The Company is under audit in Canada for tax years 2021 and 2022. The Company is no longer subject to audit in Puerto Rico for the tax years prior to tax year 2019.

 

The Company’s future effective tax rates could be adversely affected by changes in the valuation of its deferred tax assets or liabilities or changes in tax laws or interpretations thereof. In addition, the Company is subject to the examination of its income tax returns by the Internal Revenue Service and other tax authorities. The Company regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of its provision for income taxes.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Accrued Bonuses

 

The Company pays bonuses to certain executive management, field management and corporate employees based on, or after giving consideration to, a variety of financial performance measures. Bonuses for executive management, field management and certain corporate employees are accrued throughout the year for payment during the first quarter of the following year, based in part upon anticipated annual results compared to annual budgets. In addition, the Company pays discretionary bonuses to certain employees, which are not related to budget performance. Variances in actual results versus budgeted amounts can have a significant impact on the calculations and therefore on the estimates of the required accruals. Accordingly, the actual earned bonuses may be materially different from the estimates used to determine the quarterly accruals.

 

Performance-Based Restricted Stock and Stock Unit Awards

 

From time-to-time the Company issues performance-based restricted stock and stock unit awards to its executives.  Performance-based restricted stock and stock unit awards are typically vested based on certain multi-year performance metrics as determined by the Board of Directors Compensation Committee. The Company will reassess at each reporting date whether achievement of any performance condition is probable and would begin recognizing additional compensation cost if and when achievement of the performance condition becomes probable.  The Company will then recognize the appropriate expense cumulatively in the year performance becomes probable and recognize the remaining compensation cost over the remaining requisite service period. If at a later measurement date the Company determines that performance-based restricted stock or stock unit awards deemed as likely to vest are deemed as unlikely to vest, the expense recognized will be reversed.  These performance-based restricted stock and stock unit awards typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period on any stock and stock unit awards that actually vest, if any.  Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet.  Dividends for performance-based restricted stock and stock unit awards that ultimately do not vest are forfeited.  

 

Forward-looking Information

 

The Company’s growth prospects are influenced by broad economic trends. The pace of customer capital spending programs, new product launches and similar activities have a direct impact on the need for engineering, life sciences, data and solutions. When the U.S., Canadian or global economies decline, the Company’s operating performance could be adversely impacted. In addition, global events such as international conflicts, trade disputes, or health pandemics and endemics also have a substantial impact on our operations and financial results. The Company believes that its fiscal discipline, strategic focus on targeted vertical markets and diversification of service offerings provides some insulation from adverse trends. However, general economic declines could result in the need for future cost reductions or changes in strategy.

 

Additionally, changes in government regulations could result in prohibition or restriction of certain types of employment services or the imposition of new or additional employee benefits, licensing or tax requirements with respect to the provision of employment services that may reduce the Company’s future earnings. There can be no assurance that the Company will be able to increase the fees charged to its clients in a timely manner and in a sufficient amount to cover increased costs as a result of any of the foregoing.

 

The consulting and employment services market is highly competitive with limited barriers to entry. The Company competes in global, national, regional and local markets with numerous competitors in all of the Company’s service lines. Price competition in the industries the Company serves is significant, and pricing pressures from competitors and customers are increasing. The Company expects that the level of competition will remain high in the future, which could limit the Company’s ability to maintain or increase its market share or profitability.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Fiscal Year Ended December 28, 2024 Compared to Fiscal Year Ended December 30, 2023

 

A summary of operating results for the fiscal years ended December 28, 2024 and December 30, 2023 is as follows (in thousands):

 

		Fiscal Years Ended
		December 28, 2024								December 30, 2023
		Amount				% of Revenue				Amount				% of Revenue
Revenue		$	278,380				100.0			$	263,237				100.0
Cost of services			198,602				71.3				186,541				70.9
Gross profit			79,778				28.7				76,696				29.1
Selling, general and administrative			56,787				20.4				52,185				19.8
Depreciation and amortization of property and equipment			1,419				0.5				1,032				0.4
Amortization of acquired intangible assets			136				0.0				182				0.1
Impairment of intangible assets			547				0.3				-				-
Potential stock issuance and financing activities			323				0.1				-				-
Remeasurement of contingent consideration			(1,759	)			(0.6	)			-				-
Gain on sale of assets			-				-				(395	)			(0.2	)
Operating costs and expenses			57,453				20.6				53,004				20.1
Operating income			22,325				8.1				23,692				9.0
Other expense, net			2,135				0.8				1,497				0.6
Income before income taxes			20,190				7.3				22,195				8.4
Income tax expense			6,863				2.5				5,364				2.0
Net income		$	13,327				4.8			$	16,831				6.4

 

The Company follows a 52/53 week fiscal reporting calendar ending on the Saturday closest to December 31. The fiscal years ended December 28, 2024 (fiscal 2024) and December 30, 2023 (fiscal 2023) consisted of fifty-two weeks each.

 

Revenue.  Revenue increased 5.8%, or $15.1 million, for the fiscal year ended December 28, 2024 as compared to December 30, 2023 (the “comparable prior year period”).  Revenue increased $6.4 million in the Specialty Health Care segment, increased $11.8 million in the Engineering segment and decreased $3.1 million in the Life Sciences, Data and Solutions segment.  See Segment Discussion for further information on revenue changes.

 

Cost of Services and Gross Profit. Cost of services increased 6.5%, or $12.1 million, for the fiscal year ended December 28, 2024 as compared to the comparable prior year period, primarily due to the increase in revenue. Cost of services as a percentage of revenue was 71.3% for the fiscal year ended December 28, 2024 and 70.9% for the comparable prior year period. See Segment Discussion for further information regarding changes in cost of services and gross profit.

 

Selling, General and Administrative.  Selling, general and administrative (“SGA”) expenses were $56.8 million for the fiscal year ended December 28, 2024 as compared to $52.2 million for the comparable prior year period. As a percentage of revenue, SGA expenses were 20.4% for the fiscal year ended December 28, 2024 and 19.8% for the comparable prior year period.  See Segment Discussion for further information on SGA expense changes.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Fiscal Year Ended December 28, 2024 Compared to Fiscal Year Ended December 30, 2023 (Continued)

 

Costs Associated with Potential Stock Issuance and Financing Transactions. In the fiscal year ended December 28, 2024, the Company filed a Registration Statement on Form S-3 (the Registration Statement) with the Securities and Exchange Commission for an offering of up to $100.0 million of various securities. The Company also entered an At Market Issuance Sales Agreement under which the Company may sell, under the Registration Statement, up to $50.0 million worth of shares of the Company’s common stock. The Company amended and extended its letter of credit facility with Citizens Bank through December 3, 2029. The Company incurred total expenses of $0.3 million related to these transactions.

 

Gain on sale of assets. On July 30, 2021, the Company sold the principal assets and certain liabilities of its Pickering and Kincardine offices, located in Ontario, Canada. These two offices were often referred to as Canada Power Systems and principally provided engineering services to two major nuclear power providers in Canada.  The two Canada Power Systems offices were part of a reporting unit within the Company’s Engineering segment. For the fiscal year ended December 30, 2023, the Company recorded a discrete gain on the sale of these assets and liabilities of $0.4 million due to the final collection of escrow funds from the transaction.

 

Other Expense, Net.  Other expense, net consists of interest expense, unused line fees and amortized loan costs on the Company’s line of credit, net of interest income and gains and losses on foreign currency transactions.  Other expense, net increased by $0.6 million for the fiscal year ended December 28, 2024 as compared to the comparable prior year period, primarily due to an increase in interest expense, net. Interest expense increased due to increased borrowing and increased interest rates.   

 

Income Tax Expense.  The Company recognized $6.9 million of income tax expense for the fiscal year ended December 28, 2024, as compared to $5.4 million for the comparable prior-year period.  The consolidated effective income tax rate for the current period was 34.0% as compared to 24.2% for the comparable prior-year period. The effective fiscal 2023 income tax rates as of December 28, 2024, were approximately 29.4%, 21.1% and 10.8% in the United States, Canada, and Europe, respectively. The relative income or loss generated in each jurisdiction can materially impact the overall effective income tax rate of the Company, particularly the ratio of Canadian and Serbian pretax income versus U.S. pretax income.  The effective income tax rate can also be impacted by discrete permanent differences affecting any period presented. The primary reason for the increase in the consolidated effective rate in the current period was due to permanent tax differences in the United States during the fiscal year ended December 28, 2024.

 

Differences between the effective tax rate and the applicable U.S. federal statutory rate may arise, primarily from the effect of state and local income taxes, share-based compensation, and potential tax credits available to the Company. The actual 2024 effective tax rate may vary from the estimate depending on the actual operating income earned in various jurisdictions, the potential availability of tax credits, and the exercise of stock options and vesting of share-based awards.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Fiscal Year Ended December 28, 2024 Compared to Fiscal Year Ended December 30, 2023 (Continued)

 

Segment Discussion

 

Specialty Health Care

 

Specialty Health Care revenue of $142.7 million for the fiscal year ended December 28, 2024, increased 4.7%, or $6.4 million, compared to the comparable prior-year period. The increase in revenue was driven by the Company’s school clients, offset by a decrease in revenue from the Company’s non-school clients. Revenue from school clients for the fiscal year ended December 28, 2024, was $117.7 million as compared to $103.0 million for the comparable prior-year period. Revenue from non-school clients for the fiscal year ended December 28, 2024, was $25.0 million as compared to $33.2 million for the comparable prior-year period. The decrease in non-school revenue was primarily driven by the reduction in revenue from a large long-term care group where the Company deliberately reduced services, which generated $3.2 million in the current period as compared to $9.8 million in the comparable prior-year period. Gross profit increased by 6.5%, or $2.6 million, to $42.5 million for the fiscal year ended December 28, 2024 as compared to $39.9 million in the comparable prior-year period. Gross profit increased due to an increase in revenue and gross profit margin. Gross profit margin for the fiscal year ended December 28, 2024, increased to 29.8% compared to 29.3% for the comparable prior-year period. The increase in gross profit margin was primarily attributed to a greater mix shift to school services as opposed to non-school services, offset by increased unemployment tax rates in New York. Specialty Health Care experienced operating income of $11.7 million for the fiscal year ended December 28, 2024, as compared to $13.5 million for the comparable prior-year period. The primary reason for the decrease in operating income was an increase in SGA expense to $30.3 million for the fiscal year ended December 28, 2024 compared to $26.0 million for the comparable prior-year period. SGA expense increased primarily due to sales and recruiting infrastructure investments expected to generate higher growth rates for the 2024/2025 and 2025/2026 school years and a higher allocation of corporate SGA expense.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Fiscal Year Ended December 28, 2024 Compared to Fiscal Year Ended December 30, 2023 (Continued)

 

Segment Discussion (Continued)

 

Engineering

 

Engineering revenue of $96.5 million for the fiscal year ended December 28, 2024, increased 13.9%, or $11.8 million, compared to the comparable prior-year period.  The increase in revenue comprised the following: an increase in Energy Services revenue of $15.1 million, offset by decreases in Aerospace revenue of $0.2 million and Industrial Processing revenue of $3.1 million.  Aerospace revenue decreased primarily due to a contract reduction for the Company’s major outsourcing client. The Company believes the decrease in Industrial Processing revenue was mainly due to the irregular timing of large contracts with its Industrial Processing clients. Gross profit increased by 9.4%, or $1.9 million, compared to the comparable prior-year period. Gross profit increased because of the increase in revenue, offset by a decrease in gross profit margin. The gross profit margin of 23.4% for the current period decreased from 24.3% for the comparable prior-year period. The decrease in gross profit margin was primarily due to lower utilization and mix-shift associated with fixed-price project revenue from the Energy Services group. The Engineering segment experienced operating income of $4.5 million for the fiscal year ended December 28, 2024, compared to $3.5 million for the comparable prior-year period. Operating income increased due to the increase in gross profit, offset by an increase in SGA expense. The Engineering segment’s SGA expense of $17.4 million increased from $17.0 million, primarily due to a higher allocation of corporate SGA expense.

 

Life Sciences, Data and Solutions

 

Life Sciences, Data and Solutions revenue of $39.2 million for the fiscal year ended December 28, 2024, decreased 7.3%, or $3.1 million, compared to the comparable prior-year period.  The Company primarily attributes the decrease in revenue to the timing of large projects and a deemphasis of the Company’s legacy staffing business. Gross profit of $14.7 million for the fiscal year ended December 28, 2024, decreased 9.0%, or $1.5 million, compared to $16.2 million for the comparable prior-year period. Gross profit decreased due to the decrease in revenue and a decrease in gross margin. Gross profit margin for the fiscal year ended December 28, 2024, was 37.5% as compared to 38.2% for the comparable prior-year period. The Company attributes the gross profit margin decrease to normal fluctuations in high margin project work. The Life Sciences, Data and Solutions segment experienced operating income of $6.5 million for the fiscal year ended December 28, 2024 compared to $6.6 million for the comparable prior-year period.  The decrease in operating income was primarily due to the decrease in gross profit and a small increase in SGA expense of $0.1 million, offset by a remeasurement of contingent consideration of $1.8 million for the fiscal year ended December 28, 2024.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Supplemental Operating Results on a Non-GAAP Basis

 

The following non-GAAP measures, which adjust for the categories of expenses described below, are non-GAAP financial measures.  Our management believes that these non-GAAP financial measures (“Adjusted operating income”, “EBITDA”, “Adjusted EBITDA”, “Adjusted net income”, and “Adjusted diluted net earnings per share”) are useful information for investors, shareholders and other stakeholders of our company in gauging our results of operations on an ongoing basis and to enhance investors’ overall understanding of our current financial performance and period-to-period comparisons.  We believe these non-GAAP financial measures are performance measures and not liquidity measures. These non-GAAP financial measures should not be considered as an alternative to net income or operating income as indicators of performance.  In addition, neither EBITDA nor Adjusted EBITDA takes into account changes in certain assets and liabilities as well as interest and income taxes that can affect cash flows.  We do not intend the presentation of these non-GAAP measures to be considered in isolation or as a substitute for results prepared in accordance with GAAP.  These non-GAAP measures should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP.

 

The following unaudited tables present the Company's GAAP net income and GAAP operating income and the corresponding adjustments used to calculate Adjusted operating income, EBITDA, Adjusted EBITDA, Adjusted net income and Adjusted diluted net earnings per share for the fiscal years ended December 28, 2024 and December 30, 2023. 

 

		Fiscal Years Ended
		December 28, 2024				December 30, 2023
GAAP operating income		$	22,325			$	23,692
Adjustments
Gain on sale of assets			-				(395	)
Remeasurement of contingent consideration			(1,759	)			-
Equity compensation			2,864				2,092
Potential stock issuance and financing transaction			323				-
Impairment of intangible assets			547				-
Adjusted operating income (non-GAAP)		$	24,300			$	25,389
GAAP net income		$	13,327			$	16,831
Income tax expense			6,863				5,364
Interest expense, net			2,215				1,399
Depreciation of property and equipment			1,419				1,032
Amortization of acquired intangible assets			136				182
EBITDA (non-GAAP)		$	23,960			$	24,808
Adjustments
Gain on sale of assets			-				(395	)
Remeasurement of contingent consideration			(1,759	)			-
(Gain) loss on foreign currency transactions			(80	)			98
Equity compensation			2,864				2,092
Potential stock issuance and financing transaction			323				-
Impairment of intangible assets			547				-
Adjusted EBITDA (non-GAAP)		$	25,855			$	26,603

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Supplemental Operating Results on a Non-GAAP Basis (Continued)

 

		Fiscal Years Ended
		December 28, 2024				December 30, 2023
GAAP net income		$	13,327			$	16,831
Adjustments
Gain on sale of assets			-				(395	)
Remeasurement of contingent consideration			(1,759	)			-
(Gain) loss on foreign currency transactions			(80	)			98
Equity compensation			2,864				2,092
Potential stock issuance and financing transaction			323				-
Impairment of intangible assets			547				-
Tax impact from normalized rate			900				(1,113	)
Adjusted net income (non-GAAP)		$	16,122			$	17,513
GAAP diluted net earnings per share		$	1.68			$	1.96
Adjustments
Gain on sale of assets			-			$	(0.04	)
Remeasurement of contingent consideration		$	(0.22	)			-
(Gain) loss on foreign currency transactions		$	(0.01	)		$	0.01
Equity compensation		$	0.36			$	0.24
Potential stock issuance and financing transaction		$	0.04				-
Impairment of intangible assets		$	0.07				-
Tax impact from normalized rate(a)		$	0.11			$	(0.13	)
Adjusted diluted net earnings per share (non-GAAP)		$	2.03			$	2.04

 

(a)

Amount reflects an adjustment to income tax expense applied to non-GAAP adjusted consolidated taxable income. The Company used an estimated effective income tax rate of 26.5% for both periods presented, approximating the Company’s federal USA income tax rate plus the tax-affected rate for states and Puerto Rico.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Liquidity and Capital Resources

 

The following table summarizes the major captions from the Company’s Consolidated Statements of Cash Flows

($ in thousands):

 

		Fiscal Years Ended
		December 28, 2024				December 30, 2023
Cash provided by (used in):
Operating activities		$	6,170			$	12,482
Investing activities		$	(2,572	)		$	(2,536	)
Financing activities		$	(4,828	)		$	(3,855	)

 

Operating Activities

 

Operating activities provided $6.2 million of cash for the fiscal year ended December 28, 2024 as compared to providing $12.5 million in the comparable prior year period.  The major components of cash provided by operating activities in the fiscal year ended December 28, 2024 and the comparable prior year period are as follows: net income and changes in accounts receivable, the net of transit accounts payable and transit accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses and accrued payroll and related costs, and deferred revenue.

 

For the fiscal year ended December 28, 2024, the Company experienced net income of $15.0 million as compared to $16.8 million for the comparable prior year period.  An increase in accounts receivables in the fiscal year ended December 28, 2024, used $7.3 million of cash as compared to using $20.6 million in the comparable prior year period. The Company primarily attributes this increase in accounts receivables for the fiscal year that ended December 28, 2024, to these factors:

 

1)

A large school client stopped payments early in the fourth quarter due to administrative issues unrelated to the Company. The Company estimates that this school client's December 28, 2024 accounts receivable balance exceeded normalized levels by approximately $6.0 million. The Company expects this balance to approximate normalized levels by the end of the first quarter of fiscal 2025.

2)

A Life Sciences, Data and Solutions client stopped making payments while negotiating change orders and a two-year contract extension. The Company estimates that this school client's December 28, 2024 accounts receivable balance exceeded normalized levels by approximately $3.8 million. The Company expects this balance to approximate normalized levels by the end of the first quarter of fiscal 2025.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Liquidity and Capital Resources (Continued)

 

Operating Activities (Continued)

 

While highly variable, the Company’s transit accounts payable typically exceeds the Company’s transit accounts receivable, but absolute amounts and differences fluctuate significantly from quarter to quarter in the normal course of business.  The net of transit accounts payable and transit accounts receivable was a net payable of $16.6 million as of December 28, 2024 as compared to a net payable of $22.2 million as of December 30, 2023, using $5.6 million of cash during the fiscal year ended December 28, 2024.  The decrease to net transit payable as of December 28, 2024 was due to normal fluctuations associated with several large, multiyear EPC projects. In a typical EPC contract, the Company receives significant cash upfront to fund equipment procurement and construction subcontractors throughout the project.

 

Prepaid expenses and other current assets used cash of $3.7 million for the fiscal year ended December 28, 2024 as compared to providing negligible cash for the comparable prior year period.  The Company typically attributes changes to prepaid expenses and other current assets, if any, to general timing of payments in the normal course of business. Since certain expenses are paid before a fiscal year concludes and are amortized over the next fiscal year, prepaid expenses and other current assets generally tend to increase at the end of a fiscal year and decrease during the first three quarters of the following fiscal year. The December 28, 2024 prepaid expense balance of $8.3 million included $3.1 million for domestic tax payments, as compared to $0.6 million as of December 30, 2023.

 

An increase in accounts payable and accrued expenses provided cash of $1.1 million for the fiscal year ended December 28, 2024 as compared to using $1.5 million for the comparable prior year period.  The Company attributes these changes to typical fluctuations in the normal course of business.

 

Changes in accrued payroll and related costs used $1.3 million for the fiscal year ended December 28, 2024 as compared to using cash of $1.8 million for the fiscal year ended December 30, 2023.  There are four primary factors that generally impact accrued payroll and related costs: 1) there is a general correlation to operating expenses as payroll and related costs is the Company’s largest expense group, so as operating costs increase or decrease, absent all other factors, so will the accrued payroll and related costs; 2) the Company pays the majority of its payroll every two weeks and normally has thirty-nine weeks in a fiscal quarter, which means that the Company normally has a major payroll on the last business day of every other quarter; 3) the timing of various payroll related payments varies in the normal course of business; and 4) most of the Company’s senior management participate in annual incentive plans and while progress advances are sometimes made during the fiscal year, these accrued bonus balances, to the extent they are projected to be achieved, generally accumulate throughout the year.  A significant portion of these incentive plan accruals are typically paid at the beginning of one fiscal year, pertaining to the prior fiscal year.  The Company’s last major payroll for the fiscal year ended December 28, 2024 was paid on December 27, 2024. 

 

The Company’s deferred revenue balance as of December 28, 2024 was $4.2 million, compared to $1.9 million as of December 30, 2023, providing cash from operations of $2.3 million for the fiscal year ended December 28, 2024.  The increase was associated with upfront payments for future labor associated with the Company’s EPC contracts.

 

Investing Activities

 

Investing activities used $2.6 million of cash for the fiscal year ended December 28, 2024 as compared to using $2.5 million in the comparable prior year period.  Investing activities used $2.6 million for the purchase of property and equipment in the current period as compared to using $2.9 million in the prior year comparable period. The fiscal year ended December 30, 2023 included a discrete gain associated with the Company’s sale of its Canada Power Systems business unit.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Liquidity and Capital Resources (Continued)

 

Financing Activities

 

Financing activities used $4.8 million of cash for the fiscal year ended December 28, 2024 as compared to using $3.9 million in the comparable prior year period.  The Company made net borrowings under its line of credit of $4.2 million during the fiscal year ended December 28, 2024 as compared to net borrowings of $22.0 million in the comparable prior year period.  During the fiscal year ended December 28, 2024, the Company used $1.3 million to pay withholding taxes upon the vesting of equity grants, in connection with which a commensurate number of vesting shares was retired. The Company used $7.8 million to repurchase and retire shares of its common stock during the fiscal year ended December 28, 2024 as compared to using $25.8 million in the comparable prior year period. The Company generated cash of $0.7 million from sales of shares from its equity plans for both periods presented. The Company did not pay contingent consideration in the current period as compared to paying $0.3 million in the comparable prior year period.

 

Borrowings under the Revolving Credit Facility bear interest at one of two alternative rates, as selected by the Company at each incremental borrowing.  These alternatives are: (i) SOFR (Secured Overnight Financing Rate), plus applicable margin, typically borrowed in fixed 30-day increments, or (ii) the agent bank’s prime rate generally borrowed over shorter durations.  The Company also pays unused line fees based on the amount of the Revolving Credit Facility that is not drawn.  Unused line fees are recorded as interest expense. The effective weighted average

interest rate, including unused line fees, for the fiscal years ended December 28, 2024 and December 30, 2023 was 6.6% and 6.5%, respectively.

 

All borrowings under the Fifth Amended and Restated Loan Agreement remain collateralized with substantially all of the Company’s assets, as well as the capital stock of its subsidiaries. The Revolving Credit Facility also contains various financial and non-financial covenants, such as a covenant that restricts the Company’s ability to borrow in order to pay dividends. As of December 28, 2024, the Company was in compliance with all covenants contained in the Revolving Credit Facility. The Company believes that it will maintain compliance with its financial covenants for the foreseeable future.

 

Borrowings under the line of credit as of December 28, 2024 and December 30, 2023 were $35.0 million and $30.9 million, respectively. At December 28, 2024 and December 30, 2023, there were letters of credit outstanding for $7.4 and $2.0 million, respectively. At December 28, 2024 and December 30, 2023, the Company had availability for additional borrowings under the Revolving Credit Facility of $22.6 million and $12.1 million, respectively.

 

In addition to borrowings and sales of shares from its equity plans, the Company may raise capital through sales of shares of common stock under its at the market issuance program (the “ATM Program”) established under its March 2024 At Market Issuance Sales Agreement with B. Riley Securities, Inc., as the agent (the “Agent”). The ATM Program allows the Company to offer and sell shares of the common stock having an aggregate sales price of up to $50.0 million from time to time through the Agent. To date, the Company has not sold any shares under the ATM Program.

 

Current Liquidity and Revolving Credit Facility

 

Liquidity is a measure of our ability to meet potential cash requirements, maintain our assets, fund our operations, and meet the other general cash needs of our business. Our liquidity is impacted by general economic, financial, competitive, and other factors beyond our control. Our liquidity requirements consist primarily of funds necessary to pay our expenses, principally labor costs, and other related expenditures. We generally satisfy our liquidity needs through cash provided by operations and, when necessary, our revolving line of credit from Citizens Bank. The Company believes it has a great deal of flexibility to reduce its costs if it becomes necessary. The Company believes that it can satisfy its liquidity needs for at least the next twelve months.

 

The Company’s liquidity and capital resources as of December 28, 2024, included accounts receivable and total current asset balances of $78.0 million and $97.0 million, respectively. Current liabilities were $53.6 million as of December 28, 2024 and were exceeded by total current assets by $43.4 million.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Liquidity and Capital Resources (Continued)

 

Current Liquidity and Revolving Credit Facility (Continued)

 

The Company experiences volatility in its daily cash flow and, at times, relies on the revolving line of credit to provide daily liquidity for the Company’s financial operations. As of December 28, 2024, the Company was in compliance with all financial covenants contained in the Revolving Credit Facility. The Company believes that it will maintain compliance with its financial covenants for the foreseeable future.

 

Dividends

 

All restricted share awards contain a dividend equivalent provision entitling holders to dividends paid between the restricted stock award grant date and ultimate share distribution date.  As of December 28, 2024, there were no accrued dividends.

 

While the Company, at this time, has no plans to issue any future dividends, any future payment of dividends will depend upon, among other things, the Company’s earnings, financial condition, capital requirements, level of indebtedness, contractual restrictions, and other factors that the Board of Directors deems relevant.  The Revolving Credit Facility (as discussed above) prohibits the payment of any dividends or distributions on account of the Company’s capital stock without the prior consent of the majority of the Company’s lenders. 

 

Commitments and Contingencies

 

The Company anticipates that its primary uses of capital in future periods will be for working capital purposes. Funding for any long-term and short-term capital requirements as well as future acquisitions will be derived from one or more of the Revolving Credit Facility (or a replacement thereof), funds generated through operations or future financing transactions. The Company is subject to legal proceedings and claims that arise from time to time in the ordinary course of its business, which may or may not be covered by insurance. Were an unfavorable final outcome to occur, there exists the possibility of a material adverse impact on our financial position, liquidity, and the results of operations.

 

The Company’s business strategy is to achieve growth both internally through operations and externally through strategic acquisitions. The Company from time to time engages in discussions with potential acquisition candidates. The Company has acquired numerous companies throughout its history and those acquisitions have generally included significant future contingent consideration. As the size of the Company and its financial resources increase however, acquisition opportunities requiring significant commitments of capital may arise. In order to pursue such opportunities, the Company may be required to incur debt or issue potentially dilutive securities in the future. No assurance can be given as to the Company’s future acquisition and expansion opportunities or how such opportunities will be financed.

 

The Company is exposed to various asserted claims as of December 28, 2024, where the Company believes it has a probability of loss. Additionally, the Company is exposed to other asserted claims whereby an amount of loss has not been declared, and the Company cannot determine the potential loss. Any of these various claims could result in an unfavorable outcome or settlement that exceeds the accrued amounts. However, the Company believes that such matters will not, either individually or in the aggregate, have a material adverse effect on its business, consolidated financial position, results of operations, or cash flows. As of December 28, 2024, the Company has accrued $2.8 million for asserted claims. 

 

 

ITEM 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

 

Liquidity and Capital Resources (Continued)

 

Commitments and Contingencies (Continued)

 

In April 2022, a client of the Company’s Engineering segment alleged that a system partially designed by the Company is not operating as intended and that the Company is responsible. The Company has not determined if it has any liability. In the event of liability, the Company believes its damages are contractually limited to an amount no higher than $3.3 million. Furthermore, the Company believes that if it were found liable, any damages would be covered by insurance, subject to a deductible of $0.5 million and maximum coverage of $5.0 million. While the clients estimated damages are not known, the client has either inferred or asserted during settlement discussions that it’s damages significantly exceed the Company’s insurance coverage of $5 million. While the Company attempts to find a mutually agreeable solution, the Company has reserved $0.5 million for this project. The Company can give no assurance that its liability is limited to $3.3 million or that liability over $0.5 million, if any, will be covered by insurance.

 

The Company is also subject to other pending legal proceedings and claims that arise from time to time in the ordinary course of its business, which may not be covered by insurance.

 

The Company utilizes SAP software for its financial reporting and accounting system which was initially implemented in 1999 and was upgraded during fiscal years 2023 and 2024. The Company went live with its new SAP system in April 2024.

 

The Company’s current commitments consist primarily of lease obligations for office space. The Company believes that its capital resources are sufficient to meet its present obligations and those to be incurred in the normal course of business for at least the next 12 months.

 

The Company leases office facilities and various equipment under non-cancelable leases expiring at various dates through October 2029. Certain leases are subject to escalation clauses based upon changes in various factors.

 

Maturities of lease liabilities are as follows:

 

Fiscal Year		Operating Leases				Finance Leases
2025			1,300				773
2026			1,213				773
2027			1,017				387
2028			966				-
2029			650				-
Thereafter			1,168				-
Total lease payments			6,314				1,933
Less: imputed interest			(913	)			(123	)
Total		$	5,401			$	1,810

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

Liquidity and Capital Resources (Continued)

 

Future Contingent Payments

 

As of December 28, 2024, the Company had one acquisition agreement whereby additional contingent consideration may be earned by the sellers: effective September 30, 2018, the Company acquired certain assets of Thermal Kinetics Engineering, PLLC and Thermal Kinetics Systems, LLC. The Company estimates future contingent payments at December 28, 2024 as follows:

 

		Total
Payable in fiscal 2025		$	212

 

Estimates of future contingent payments are subject to significant judgment and actual payments may materially differ from estimates.  The Company estimates future contingent consideration payments based on forecasted performance and recorded the fair value of those expected payments as of December 28, 2024.  Contingent consideration related to acquisitions is recorded at fair value (level 3) with changes in fair value recorded in other (expense) income, net.

 

Off-Balance Sheet Arrangements

 

None.

 

Impact of Inflation

 

Consulting, staffing, and project services are generally priced based on mark-ups on prevailing rates of pay, and as a result are able to generally maintain their relationship to direct labor costs. Permanent placement services are priced as a function of salary levels of the job candidates.

 

The Company’s business is labor intensive; therefore, the Company has a high exposure to increasing healthcare benefit costs. The Company attempts to compensate for these escalating costs in its business cost models and customer pricing by passing along some of these increased healthcare benefit costs to its customers and employees, however, the Company has not been able to pass on all increases. The Company is continuing to review its options to further control these costs, which the Company does not believe are representative of general inflationary trends. Otherwise, inflation has not been a meaningful factor in the Company’s operations.

 

 

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
	RESULTS OF OPERATIONS (CONTINUED)

 

New Accounting Standards

 

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements through enhanced disclosures about significant segment expenses. The amendments require disclosure of significant segment expenses regularly provided to the chief operating decision maker (CODM) as well as other segment items, extend certain annual disclosures to interim periods, clarify the applicability to single reportable segment entities, permit more than one measure of profit or loss to be reported under certain conditions, and require disclosure of the title and position of the CODM. We adopted this ASU for the fiscal year ended December 28, 2024.

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires the annual financial statements to include consistent categories and greater disaggregation of information in the rate reconciliation, and income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for the Company’s annual reporting periods beginning after December 15, 2024, with early adoption permitted, and should be applied on a prospective basis, with a retrospective option. We are currently evaluating the effect that adoption of this ASU will have on our disclosures.

 

 

ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

The Company’s exposure to market risk for changes in interest rates relates primarily to the Company’s investment portfolio and debt instruments, which primarily consist of the Revolving Credit Facility. The Company does not have any derivative financial instruments in its portfolio. The Company places its investments in instruments that meet high credit quality standards. The Company is adverse to principal loss and ensures the safety and preservation of its invested funds by limiting default risk, market risk and reinvestment risk. As of December 28, 2024, the Company’s investments consisted of cash and money market funds. The Company does not use interest rate derivative instruments to manage its exposure to interest rate changes. Based on the Company’s variable-rate line of credit balances during the fiscal year ended December 28, 2024, if the interest rate on the Company’s variable-rate line of credit (using an incremental borrowing rate) during the period had been 1.0% higher, the Company’s interest expense on an annualized basis would have increased by $0.3 million. The Company does not expect any material loss with respect to its investment portfolio.

 

 

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 

The financial statements, together with the report of the Company’s Independent Registered Public Accounting Firm, begins on page F-1.

 

 

ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
	FINANCIAL DISCLOSURE

 

None.

 

 

ITEM 9A.

CONTROLS AND PROCEDURES

 

The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that information required to be disclosed in Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

 

Evaluation of Disclosure Controls and Procedures

 

As of December 28, 2024, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on the foregoing, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this annual report.

 

Changes in Internal Control over Financial Reporting

 

As of December 30, 2023, the Company’s management identified a material weakness in the Company’s internal control over financial reporting related to the design and maintenance of information technology controls. Specifically, the material weakness pertained to deficiencies in (i) separation of duties within the SAP ERP and General Ledger, (ii) adequate restriction of administrator-type access to SAP, (iii) program change management controls, and (iv) user access controls to ensure appropriate segregation of duties and adequate restriction of user access to financial applications, programs, and data.

 

The Company’s management has since implemented a series of remediation measures to address these deficiencies. These measures included enhancing access controls, improving segregation of duties, strengthening program change management procedures, and implementing additional monitoring controls over IT system access and change management. As a result of these remediation efforts, the Company’s management has completed its evaluation and concluded that the previously identified material weakness has been successfully remediated as of December 28, 2024. The effectiveness of the Company’s internal control over financial reporting as of December 28, 2024, has been audited by Withum Smith+Brown, PC, an independent registered public accounting firm, as stated in this Form 10-K with the Financial Statements.

 

Management’s Annual Report on Internal Control over Financial Reporting

 

The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. The Company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that the Company’s receipts and expenditures are being made only in accordance with authorizations of the Company’s management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of assets that could have a material effect on the Company’s financial statements.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

 

ITEM 9A.

CONTROLS AND PROCEDURES (CONTINUED)

 

Management’s Annual Report on Internal Control over Financial Reporting (Continued)

 

The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as of December 28, 2024, based on the framework set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework (the “2013 framework”). Based on that assessment, management concluded that, as of December 28, 2024, the Company’s internal control over financial reporting was effective based on the criteria established in the 2013 framework.

 

The Company’s independent registered public accounting firm, Withum Smith+Brown, PC, has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting as of December 28, 2024. This report follows.

 

ITEM 9B.

OTHER INFORMATION

 

(a)          Form 8-K Disclosure

 

On March 12, 2025, the Company and Mr. Vizi entered into an amendment and restatement of his Executive Severance Agreement dated June 1, 2018, which was filed as an exhibit to the Company’s Current Report on Form 8-K dated June 7, 2018 (the "Severance Agreement"). 

 

The amended and restated agreement modified:

 

●

the amount that Mr. Vizi would receive if either (a) he is involuntarily terminated by the Company for any reason other than "Cause" (as defined in the Severance Agreement), "Disability" (as defined in the Severance Agreement) or death, or (b) he resigns for "Good Reason" (as defined in the Severance Agreement), and, in each case, the termination is not a "Termination Related to a Change in Control" (as defined in the Severance Agreement).  Mr. Vizi will receive, among other amounts, the following severance payments in such event (the changes made by the amendment and restatement are noted):

 

o

an amount equal to 2.0 times (modified by the amendment and restatement from 1.5 times) the sum of (a) Mr. Vizi's annual base salary as in effect immediately prior to the termination date (before taking into account any reduction that constitutes Good Reason) ("Annual Base Salary") and (b) highest annual bonus paid to Mr. Vizi in any of the five fiscal years immediately preceding Mr. Vizi's termination date or the amount that would be granted to him for the subsequent year, at target (modified by the amendment and restatement to increase the measurement period from three to five years and to add the subsequent year at target), which for all purposes under the Severance Agreement shall be deemed to include the grant date fair value of any restricted stock units granted subject to time-based or performance-based vesting (modified by the amendment and restatement to add performance-based equity, rather than only time-based) only to time-based vesting ("Bonus"), to be paid in installments over the twelve-month period following Mr. Vizi's termination date; and

 

●

the multiplier applicable to the amount that Mr. Vizi would receive, if a Change in Control occurs and he experiences a qualifying termination, from 2.0 times, as set forth in the original Severance Agreement, to 2.99 times, with the definition of Bonus for the purpose of such calculation modified as described above.

 

The foregoing description of the amendment and restatement to the Severance Agreement is qualified in its entirety by the full text of the Amended and Restated Executive Severance Agreement, a copy of which is filed herewith as Exhibit 10(m).

 

46

---

 

 

ITEM 9B.

OTHER INFORMATION (CONTINUED)

 

(b)          Rule 10b5-1 Trading Plans

 

As disclosed in the table below, during the three months ended December 28, 2024, certain of the Company’s directors and officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted a “Rule 10b5-1 trading arrangement” (as defined in Item 408(a) of Regulation S-K):

 

Name	Position	Action	Adoption Date	Expiration Date	Aggregate Numbers of Common Stock to be Purchased/Sold
Bradley S. Vizi	Executive Chairman & President	Adopted	December 7, 2023	March 7, 2026		650,000	(1)
Michael Saks	Division President, Health Care Services	Adopted	December 5, 2023	December 1, 2024		18,000	(1)
Kevin D. Miller	Chief Financial Officer	Adopted	January 1, 2025	December 31, 2026		183,600	(1)

___________________

 

(1) The aggregate number of shares that can be sold under the plan is allocated into a series of tranches that would be sold at laddered prices as outlined in the plan.

 

Other than as disclosed above, no other officer or director of the Company adopted, terminated, or modified a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” (as defined in Item 408(a) of Regulation S-K).

 

ITEM 9C.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

 

None.

 

 

PART III

 

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 

The information required by Item 10 shall be included in the 2025 Proxy Statement and is incorporated herein by reference.

 

The Company has a Policy Statement - Insider Trading that governs transactions in our securities by our directors, officers and employees, and promote compliance with the laws and rules applicable thereto. The Policy Statement – Insider Trading is filed with this Annual Report on Form 10-K as Exhibit 19.

 

 

ITEM 11.

EXECUTIVE COMPENSATION

 

The information required by Item 11 shall be included in the 2025 Proxy Statement and is incorporated herein by reference.

 

 

ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
	AND RELATED STOCKHOLDER MATTERS

 

Except as set forth below, the information required by Item 12 shall be included in the 2025 Proxy Statement and is incorporated herein by reference.

 

The table below presents certain information as of December 28, 2024 concerning securities issuable in connection with equity compensation plans that have been approved by the Company’s shareholders and that have not been approved by the Company’s shareholders.

 

Plan category	Number of securities to be potentially issued upon realization of restricted stock awards		Weighted-average exercise price of outstanding options, warrants and rights		Number of securities remaining available for issuance under equity compensation plans, excluding securities reflected in column (a)
	(a)		(b)		(c)
Equity compensation plans approved by security holders	589,421(1)		N/A		295,680
Equity compensation plans not approved by security holders	____________________		____________________		____________________
Total	589,421(1)		N/A		295,680

 

⁽¹⁾ Includes time-based restricted stock awards of 289,421 and performance-based restricted stock awards of 300,000, none of which have an exercise price.

 

 

ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
	INDEPENDENCE

 

The information required by Item 13 shall be included in the 2025 Proxy Statement and is incorporated herein by reference.

 

 

ITEM 14.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

 

The information required by Item 14 shall be included in the 2025 Proxy Statement and is incorporated herein by reference.

 

 

PART IV

 

ITEM 15.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

 

(a)	1. and 2. Financial Statement Schedules -- See “Index to Financial Statements and Schedules” on F-1.
	3. See Item (b) below.
(b)	Exhibits
The following exhibits are filed as part of, or incorporated by reference into, this report (unless otherwise indicated, the file number with respect to each filed document is 1-10245):
	@+	(2)(a)	Asset Purchase Agreement, dated as of October 7, 2022, by and among RCM Technologies (USA), Inc., TalentHerder LLC and Christopher G. Adams; incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K dated October 13, 2022, filed with the Securities and Exchange Commission on October 13, 2022.
		(3)(a)	Articles of Incorporation, as amended; incorporated by reference to Exhibit 3(a) to the Registrant’s Annual Report on Form 10-K for the fiscal year ended October 31, 1994, filed with the Securities and Exchange Commission on January 4, 1995.
		(3)(b)	Certificate of Amendment of Articles of Incorporation; incorporated by reference to Exhibit A to the Registrant’s Proxy Statement, dated February 6, 1996, filed with the Securities and Exchange Commission on January 29, 1996.
		(3)(c)	Certificate of Amendment of Articles of Incorporation; incorporated by reference to Exhibit B to the Registrant’s Proxy Statement, dated February 6, 1996, filed with the Securities and Exchange Commission on January 29, 1996.
		(3)(d)	Amended and Restated Bylaws; incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 23, 2014.
		(3)(e)	Certificate of Designation of Series A-3 Junior Participating Preferred Stock of RCM Technologies, Inc.; incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 22, 2020.
		(4)(a)	Description of Capital Stock; incorporated by reference to Exhibit 4(a) to the Registrant’s Annual Report on Form 10-K for the fiscal year ended January 1, 2022, filed with the Securities and Exchange Commission on April 4, 2022.
	*	(10)(a)	RCM Technologies, Inc. 2000 Employee Stock Incentive Plan, dated January 6, 2000; incorporated by reference to Exhibit A to the Registrant’s Proxy Statement, dated March 3, 2000, filed with the Securities and Exchange Commission on February 28, 2000.
	*	(10)(b)	The RCM Technologies, Inc. 2007 Omnibus Equity Compensation Plan; incorporated by reference to Annex A to the Registrant’s Proxy Statement, dated April 20, 2007, filed with the Securities and Exchange Commission on April 19, 2007.
	*	(10)(c)	Executive Severance Agreement between RCM Technologies, Inc. and Kevin Miller dated December 27, 2012; incorporated by reference to Exhibit 99.2 to the Registrant’s Current Report on Form 8-K dated December 27, 2012, filed with the Securities and Exchange Commission on December 28, 2012.

 

 

ITEM 15.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (CONTINUED)

 

(b)	Exhibits (Continued)
	*	(10)(d)	Amendment No. 1 to Executive Severance Agreement between RCM Technologies, Inc. and Kevin Miller dated December 26, 2017; incorporated by reference to Exhibit 10(x) to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 30, 2017, filed with the Securities and Exchange Commission on March 8, 2018.
	*	(10)(e)	RCM Technologies, Inc. Amended and Restated 2014 Omnibus Equity Compensation Plan (as amended through December 17, 2020); incorporated by reference to Exhibit 99.1 to the Company’s Registration Statement on Form S-8 filed with the Securities and Exchange Commission on December 18, 2020.
	*	(10)(f)	Amendment to RCM Technologies, Inc. 2014 Omnibus Equity Compensation Plan; incorporated by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 15, 2021.
	*	(10)(g)	Amendment 2022-1 to RCM Technologies, Inc. 2014 Omnibus Equity Compensation Plan; incorporated by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on December 16, 2022.
	*	‌(10)(h)	Form of Stock Unit Agreement; incorporated by reference to Exhibit 99.2 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on December 16, 2014.
	*	‌(10)(i)	RCM Technologies, Inc. Change in Control Plan for Selected Executive Management; incorporated by reference to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on March 12, 2015.
	*	‌(10)(j)	Amendment 2015-3 to the RCM Technologies, Inc. 2001 Employee Stock Purchase Plan; incorporated by reference to Exhibit A to the Registrant’s Definitive Proxy Statement for the 2015 Annual Meeting filed with the Securities and Exchange Commission on October 30, 2015.
	*	‌(10)(k)	Amendment 2018-4 to the RCM Technologies, Inc. 2001 Employee Stock Purchase Plan; incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on December 18, 2018.
	*	(10)(l)	Amendment 2021-5 to the RCM Technologies, Inc. Employee Stock Purchase Plan; incorporated by reference to Exhibit A to the Company’s Definitive Proxy Statement for its 2021 Annual Meeting of Stockholders, filed with the Securities and Exchange Commission on November 12, 2021.
	*	‌(10)(m)	Amended and Restated Executive Severance Agreement, dated as of March 12, 2025, by and between the Company and Bradley S. Vizi.  (Filed herewith)

 

 

ITEM 15.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (CONTINUED)

 

(b)	Exhibits (Continued)
		‌(10)(r)	Fifth Amended and Restated Loan Agreement, dated as of December 3, 2024, by and among the Company and all of its subsidiaries, Citizens Bank, N.A., as lender and as administrative agent and arranger; incorporated by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on December 5, 2024.
		(19)	Policy Statement -- Insider Trading (Filed herewith)
		(21)	Subsidiaries of the Registrant. (Filed herewith)
		(23.1)	Consent of WithumSmith+Brown, PC. (Filed herewith)
		(31.1)	Certifications of Chief Executive Officer Required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended. (Filed herewith)
		(31.2)	Certifications of Chief Financial Officer Required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended. (Filed herewith)
		(32.1)	Certifications of Chief Executive Officer Required by Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) (Furnished herewith)
		(32.2)	Certifications of Chief Financial Officer Required by Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.) (Furnished herewith)

 

 

ITEM 15.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (CONTINUED)

 

(b)	Exhibits (Continued)
	*	(97)	RCM Technologies, Inc. Compensation Recoupment Policy; incorporated by reference to Exhibit 97 to the Registrant’s Annual Report on Form 10-K for this fiscal year ended December 30, 2023, filed with the Securities and Exchange Commission on March 14, 2024.
	*	101.INS	XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
	*	101.SCH	Inline XBRL Taxonomy Extension Schema Document
	*	101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
	*	101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
	*	101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Documents
	*	101.DEF	Inline XBRL Taxonomy Definition Linkbase Document
		104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
	*	Constitutes a management contract or compensatory plan or arrangement.
	+	The Registrant will furnish supplementally a copy of any omitted schedule to the Securities and Exchange Commission upon request.
	@	Portions of this exhibit have been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K.

 

 

ITEM 16.

FORM 10-K SUMMARY

 

None.

 

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

		RCM Technologies, Inc.
Date: March 13, 2025		By:	/s/ Bradley S. Vizi
			Bradley S. Vizi
			Executive Chairman and President
Date: March 13, 2025		By:	/s/ Kevin D. Miller
			Kevin D. Miller
			Chief Financial Officer, Treasurer and Secretary

 

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

 

Date: March 13, 2025		By:	/s/ Bradley S. Vizi
			Bradley S. Vizi
			Executive Chairman and President
Date: March 13, 2025		By:	/s/ Kevin D. Miller
			Kevin D. Miller
			Chief Financial Officer, Treasurer and Secretary (Principal Financial and Accounting Officer)
Date: March 13, 2025		By:	/s/ Chigozie O. Amadi
			Chigozie O. Amadi
			Director
Date: March 13, 2025		By:	/s/ Swarna Kakodkar
			Swarna Kakodkar
			Director
Date: March 13, 2025		By:	/s/ Jayanth S. Komarneni
			Jayanth S. Komarneni
			Director

 

 

RCM TECHNOLOGIES, INC.

FORM 10-K

INDEX TO FINANCIAL STATEMENTS AND SCHEDULES

 

 

 

	Page
Report of Independent Registered Public Accounting Firm –       WithumSmith+Brown, PC - Consolidated Financial Statements,      December 28, 2024 and December 30, 2023	F-2
Report of Independent Registered Public Accounting Firm –       WithumSmith+Brown, PC- Opinion on Internal Controls over      Financial Reporting	F-4
Consolidated Balance Sheets, December 28, 2024 and December 30, 2023	F-6
Consolidated Statements of Operations, Fiscal Years Ended      December 28, 2024 and December 30, 2023	F-7
Consolidated Statements of Comprehensive Income (Loss), Fiscal Years Ended      December 28, 2024 and December 30, 2023	F-8
Consolidated Statements of Changes in Stockholders’ Equity, Fiscal Years Ended      December 28, 2024 and December 30, 2023	F-9
Consolidated Statements of Cash Flows, Fiscal Years Ended      December 28, 2024 and December 30, 2023	F-10
Notes to Consolidated Financial Statements	F-11

 

 

RCM TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS December 28, 2024 and December 30, 2023 (Amounts in thousands, except share and per share amounts, unless otherwise indicated)

 

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

RCM TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except per share amounts, unless otherwise indicated)

 

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

RCM TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)  Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands unless otherwise indicated)

 

 

 

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

RCM TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY Fiscal Years Ended December 28, 2024 and December 30, 2023  (Amounts in thousands, except share amounts, unless otherwise indicated)

 

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

RCM TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands unless otherwise indicated)

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Description of Business and Basis of Presentation

 

RCM Technologies, Inc. (the “Company” or “RCM”) is a premier provider of business and technology solutions designed to enhance and maximize the operational performance of its customers through the adaptation and deployment of advanced engineering, life sciences, data and solutions. Additionally, the Company provides specialty healthcare staffing services through its Specialty Health Care Services group. RCM’s offices are primarily located in major metropolitan centers throughout North America, with additional offices in the Netherlands, Philippines, Serbia and Germany.

 

The consolidated financial statements are comprised of the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

 

Cash and Cash Equivalents

 

The Company considers its holdings of highly liquid money-market instruments and certificates of deposit to be cash equivalents if the securities mature within 90 days from the date of acquisition.  These investments are carried at cost, which approximates fair value.  The Company has significant cash balances at financial institutions, which, throughout the year, regularly exceed the federally insured limit of $250. Any loss incurred or lack of access to uninsured funds could have a significant adverse impact on the Company’s financial condition, results of operations and cash flows.

 

The Company held $269 and $103 of cash and cash equivalents in Canadian banks as of December 28, 2024 and December 30, 2023, respectively, which was held principally in Canadian dollars.  The Company held $496 and $638 of cash and cash equivalents in Serbian banks as of December 28, 2024 and December 30, 2023, respectively, which was held in various currencies. The Company held $556 of cash and cash equivalents in German banks as of December 28, 2024, which was held primarily in Euros. The office in Germany was opened in April 2023. The Company held $2 and $4 of cash and cash equivalents in Netherlands banks as of December 28, 2024 and December 30, 2023, respectively, which was held in various currencies.

 

Fair Value of Financial Instruments

 

The Company’s carrying value of financial instruments, consisting primarily of accounts receivable, transit accounts receivable, accounts payable and accrued expenses, transit accounts payable and borrowings under line of credit approximates fair value due to their liquidity or their short-term nature and the line of credit’s variable interest rate. The Company does not have derivative products in place to manage risks related to foreign currency fluctuations for its foreign operations or for interest rate changes.

 

Accounts Receivable and Provision for Credit Losses

 

The Company’s accounts receivable are primarily due from trade customers.  Credit is extended based on evaluation of customers’ financial condition and, generally, collateral is not required.  Accounts receivable payment terms vary and are stated in the financial statements at amounts due from customers net of a provision for credit losses.  Accounts outstanding longer than the payment terms are considered past due.  The Company determines its provision by considering a number of factors, including the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole.  The Company writes off accounts receivable when they become uncollectible, and payments subsequently received on such receivables previously written off are credited to bad debt expense.

 

F- 11

---

 

 

RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Unbilled Accounts Receivable and Work-in-Process

 

Unbilled receivables primarily represent revenue earned whereby those services are ready to be billed as of the balance sheet ending date. Work-in-process primarily represents revenue earned under contracts which the Company is contractually precluded from invoicing until future dates as project milestones are realized. The Company follows Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers when recording revenue on unbilled accounts receivable and work-in-process. See Note 4 for further details.

 

Transit Accounts Receivable and Transit Accounts Payable

 

From time to time, the Company’s Engineering segment enters into agreements to provide, among other things, construction management and engineering services.  Pursuant to these agreements, the Company a) may purchase equipment on behalf of the Company’s customer or engage subcontractors to provide construction or other services; b) typically earns a fixed percentage of the total project value; and c) assumes no ownership or risks of inventory.  In such situations, the Company acts as an agent under the provisions of FASB ASC 606 “Revenue from Contracts with Customers” and therefore recognizes revenue on a “net-basis.”  The Company records revenue on a “net” basis on relevant engineering and construction management projects, which require subcontractor/procurement costs or transit costs. In those situations, the Company charges the client a negotiated fee, which is reported as net revenue when earned. 

 

Under the terms of the agreements, the Company is typically not required to pay the subcontractor until after the corresponding payment from the Company’s end-client is received. Upon invoicing the end-client on behalf of the subcontractor or staffing agency, the Company records this amount simultaneously as both a “transit account receivable” and “transit account payable,” as the amount when paid to the Company is due to and generally paid to the subcontractor within a few days. The Company typically does not pay a given transit account payable until the related transit account receivable is collected. The Company is typically obligated to pay the subcontractor or staffing agency whether or not the client pays the Company. The Company’s transit accounts payable generally exceeds the Company’s transit accounts receivable but absolute amounts and spreads fluctuate significantly from quarter to quarter in the normal course of business.

 

Property and Equipment

 

Property and equipment are stated at cost, less accumulated depreciation and amortization, and are depreciated or amortized on the straight-line method at rates calculated to provide for retirement of assets at the end of their estimated useful lives. Computer hardware and software, and furniture and office equipment are typically depreciated over five years. Leasehold improvements are amortized over the shorter of the estimated life of the asset or the lease term.

 

F- 12

---

 

 

RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Intangible Assets

 

The Company’s intangible assets have been generated through acquisitions. The Company maintains responsibility for valuing and determining the useful life of intangible assets. As a general rule, the Company amortizes restricted covenants over four years and customer relationships over six years. However, circumstances may dictate other amortization terms as determined by the Company and assisted by their third party advisors.

 

Canadian Sales Tax

 

The Company is required to charge and collect sales tax for all Canadian clients and remits invoiced sales tax monthly to the Canadian taxing authorities whether collected or not. The Company does not collect the sales tax from its clients until they have paid their respective invoices. The Company includes uncollected Canadian sales tax invoiced to clients in its prepaid and other current assets.

 

Goodwill

 

Goodwill is not amortized but is subject to periodic testing for impairment in accordance with FASB ASC 350 “Intangibles - Goodwill and Other.” The Company tests goodwill for impairment on an annual basis as of the last day of the Company’s fiscal December each year or more frequently if events occur or circumstances change indicating that the fair value of the goodwill may be below its carrying amount. The Company has three reporting units. The Company uses a market-based approach to determine the fair value of the reporting units. This approach uses earnings/revenue multiples of similar companies recently completing acquisitions and the ability of our reporting units to generate cash flows as measures of fair value of our reporting units.

 

The Company did not record a goodwill impairment charge in fiscal years ended December 28, 2024 and December 30, 2023. There can be no assurance that future indicators of impairment and tests of goodwill impairment will not result in an impairment charge.

 

Long-Lived and Intangible Assets

 

The Company evaluates long-lived assets and intangible assets with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When the Company determines that it is probable that undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. Assets to be disposed of by sale, if any, are reported at the lower of the carrying amount or fair value less cost to sell. The Company’s intangible assets consist of customer relationships and non-compete agreements.

 

 

F- 13

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Software

 

In accordance with FASB ASC 350-40 “Accounting for Internal Use Software,” certain costs related to the development or purchase of internal-use software are capitalized and amortized over the estimated useful life of the software. During the fiscal years ended December 28, 2024 and December 30, 2023, the Company capitalized $4,141 and $1,947, respectively, for software costs. The net balance after accumulated depreciation for all software costs capitalized as of December 28, 2024 and December 30, 2023 was $5,622 and $2,325, respectively.

 

Income Taxes

 

The Company makes judgments and interpretations based on enacted tax laws, published tax guidance, as well as estimates of future earnings. These judgments and interpretations affect the provision for income taxes, deferred tax assets and liabilities and the valuation allowance. The Company evaluated the deferred tax assets and determined on the basis of objective factors that the net assets will be realized through future years’ taxable income. In the event that actual results differ from these estimates and assessments, additional valuation allowances may be required. The Company did not have any valuation allowance as of December 28, 2024 and December 30, 2023.

 

The Company accounts for income taxes in accordance with FASB ACS 740 “Income Taxes” (FASB ASC 740) which requires an asset and liability approach of accounting for income taxes.  FASB ASC 740 requires assessment of the likelihood of realizing benefits associated with deferred tax assets for purposes of determining whether a valuation allowance is needed for such deferred tax assets.  Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that such tax rate changes are enacted. The Company measures its deferred tax assets and liabilities using the tax rates that the Company believes will apply in the years in which the temporary differences are expected to be recovered or paid. The Company and its wholly owned United States subsidiaries file a consolidated federal income tax return.  The Company also files tax returns in Canada, Germany, Philippines, Puerto Rico and Serbia.

 

The Company also follows the provisions of FASB ASC 740 which prescribes a model for the recognition and measurement of a tax position taken or expected to be taken in a tax return, and provides guidance on derecognition, classification, interest and penalties, disclosure and transition.  The Company’s policy is to record interest and penalty, if any, as interest expense.

 

F- 14

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Revenue Recognition

 

The Company records revenue under Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. Revenue is recognized when we satisfy a performance obligation by transferring services promised in a contract to a customer, in an amount that reflects the consideration that we expect to receive in exchange for those services. Performance obligations in our contracts represent distinct or separate service streams that we provide to our customers.

 

We evaluate our revenue contracts with customers based on the five-step model under ASC 606: (1) Identify the contract with the customer; (2) Identify the performance obligations in the contract; (3) Determine the transaction price; (4) Allocate the transaction price to separate performance obligations; and (5) Recognize revenue when (or as) each performance obligation is satisfied.

 

The Company derives its revenue from several sources. The Company’s Engineering Services and Life Sciences, Data and Solutions segments perform consulting and project solution services. The Healthcare segment specializes in long-term and short-term staffing and placement services to hospitals, schools and long-term care facilities amongst others. All of the Company’s segments perform staff augmentation services and derive revenue from permanent placement fees.

 

The following table presents our revenue disaggregated by revenue source for the fiscal years ended December 28, 2024 and December 30, 2023:

 

		December 28, 2024				December 30, 2023
Specialty Health Care:
Time and Material		$	141,185			$	134,941
Permanent Placement Services			1,494				1,300
Total Specialty Health Care		$	142,679			$	136,241
Engineering:
Time and Material		$	47,157			$	42,443
Fixed Fee			49,302				42,232
Permanent Placement Services			-				-
Total Engineering		$	96,459			$	84,675
Life Sciences, Data and Solutions:
Time and Material		$	30,547			$	35,368
Fixed Fee			8,452				6,551
Permanent Placement Services			243				402
Total Life Sciences, Data and Solutions		$	39,242			$	42,321
		$	278,380			$	263,237

 

 

F- 15

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Revenue Recognition (Continued)

 

Time and Material

The Company’s Health Care segment predominantly recognizes revenue through time and material work while its Engineering and Life Sciences, Data and Solutions segments recognize revenue through both time and material and fixed fee work. The Company’s time and material contracts are typically based on the number of hours worked at contractually agreed upon rates, therefore revenue associated with these time and materials contracts are recognized based on hours worked at contracted rates. 

 

Fixed Fee

From time to time and predominantly in our Engineering segment, the Company enters into contracts requiring the completion of specific deliverables.  The Company has master services agreements with many of its customers that broadly define terms and conditions. Actual services performed under fixed fee arrangements are typically delivered under purchase orders that more specifically define terms and conditions related to that fixed fee project. While these master services agreements can often span several years, the Company’s fixed fee purchase orders are typically performed over six to nine month periods.  In instances where project services are provided on a fixed-price basis, revenue is recorded in accordance with the terms of each contract.  For engineering contracts estimated costs are budgeted by project, the Company then recognizes revenue by applying the costs incurred to date against the total budgeted costs and applying the percentage of completed cost against the total contract value to recognize revenue for each period.  In certain instances, revenue is invoiced at the time certain milestones are reached, as defined in the contract.  Revenue under these arrangements are recognized as the costs on these contracts are incurred.  From time-to-time, amounts paid in excess of revenue earned and recognized are recorded as deferred revenue.  Some contracts also limit revenue and billings to specified maximum amounts.  Provisions for contract losses, if any, are made in the period such losses are determined.  For contracts where there is a specific deliverable and the work is not complete and the revenue is not recognized, the costs incurred are deferred as a prepaid asset.  The associated costs are expensed when the related revenue is recognized.

 

Permanent Placement Services

The Company earns permanent placement fees from providing permanent placement services. These fees are typically based on a percentage of the compensation paid to the person placed with the Company’s client. The Company guarantees its permanent placements on a prorated basis for 90 days. In the event a candidate is not retained for the 90-day period, the Company will provide a suitable replacement candidate. In the event a replacement candidate cannot be located, the Company will provide a prorated refund to the client. An allowance for refunds, based upon the Company’s historical experience, is recorded in the financial statements.

Permanent placement revenue was $1.5 million and $1.7 million for the fiscal years ended December 28, 2024 and December 30, 2023, respectively.

 

The deferred revenue balance as of December 28, 2024 and December 30, 2023 was $4.2 million and $1.9 million, respectively. Revenue is recognized when the service has been performed.  Deferred revenue may be recognized over a period exceeding one year from the time it was recorded on the balance sheet, although this is an infrequent occurrence.  In fiscal years ended December 28, 2024 and December 30, 2023, the Company recognized revenue of $1.9 million and $1.1 million, respectively, that was included in deferred revenue at the beginning of the period.

 

F- 16

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Revenue Recognition (Continued)

 

Transit Receivables and Transit Payables

From time to time, the Company’s Engineering segment enters into agreements to provide, among other things, construction management and engineering services.  Pursuant to these agreements, the Company a) may purchase equipment on behalf of the Company’s customer or engage subcontractors to provide construction or other services; b) typically earns a fixed percentage of the total project value; and c) assumes no ownership or risks of inventory.  Under the terms of the agreements, the Company is typically not required to pay the subcontractor until after the corresponding payment from the Company’s end-client is received. Upon invoicing the end-client on behalf of the subcontractor or staffing agency, the Company records this amount simultaneously as both a “transit account receivable” and “transit account payable,” as the amount when paid to the Company is due to and generally paid to the subcontractor within a few days. The Company typically does not pay a given transit account payable until the related transit account receivable is collected. The Company is typically obligated to pay the subcontractor or staffing agency whether or not the client pays the Company. The Company’s transit accounts payable generally exceeds the Company’s transit accounts receivable but absolute amounts and spreads fluctuate significantly from quarter to quarter in the normal course of business. The transit accounts receivable was $7.3 million and related transit accounts payable was $23.9 million, for a net payable of $16.6 million, as of December 28, 2024. The transit accounts receivable was $8.9 million and related transit accounts payable was $31.1 million, for a net payable of $22.2 million, as of December 30, 2023.

 

Concentrations

 

During the fiscal year ended December 28, 2024, the Company had two customers exceed 10% of consolidated revenue, representing 19.5% and 14.1% of consolidated revenue, respectively. During the fiscal year ended December 30, 2023, the Company had two customers exceed 10% of consolidated revenue, representing 17.1% and 10.1% of consolidated revenue, respectively. All customers exceeding 10% of consolidated revenue during the periods presented are included in the Company’s Specialty Health Care segment.

 

The Company’s five, ten and twenty largest customers accounted for approximately 48.5%, 60.1% and 70.6%, respectively, of the Company’s revenue for the fiscal year ended December 28, 2024. The Company’s five, ten and twenty largest customers accounted for approximately 39.1%, 50.4% and 62.7%, respectively, of the Company’s revenue for the fiscal year ended December 30, 2023.

 

As of December 28, 2024, three clients represented more than 10% of the Company's accounts receivable, net, representing 20.4% and 12.5% from the Company's two largest Specialty Health Care clients and 11.4% from the Company's largest Engineering client. As of December 30, 2023, two clients represented more than 10% of the Company's accounts receivable, net, representing 21.2% and 14.7% from the Company's two largest Specialty Health Care clients.

 

F- 17

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Foreign Currency Translation

 

The functional currency of the Company’s Canadian, Serbian and German subsidiaries is the local currency. Assets and liabilities are translated at period-end exchange rates. Income and expense items are translated at weighted average rates of exchange prevailing during the year. Any translation adjustments are included in the accumulated other comprehensive income account in stockholders’ equity. Transactions executed in different currencies resulting in exchange adjustments are translated at spot rates and resulting foreign exchange transaction gains and losses are included in the results of operations.

 

Comprehensive Income

 

Comprehensive income consists of net income and foreign currency translation adjustments.

 

Per Share Data

 

Basic net income per share is calculated using the weighted-average number of common shares outstanding during the period. Diluted net income per share is calculated using the weighted-average number of common shares plus dilutive potential common shares outstanding during the period. Potential dilutive common shares consist of stock options and other stock-based awards under the Company’s stock compensation plans, when their impact is dilutive. Because of the Company’s capital structure, all reported earnings pertain to common shareholders and no other adjustments are necessary.

 

Share - Based Compensation

 

The Company recognizes share-based compensation over the vesting period of an award based on fair value at the grant date determined using the Black-Scholes option pricing model. Certain assumptions are used to determine the fair value of stock-based payment awards on the date of grant and require subjective judgment. Because employee stock options have characteristics significantly different from those of traded options, and because changes in the input assumptions can materially affect the fair value estimate, the existing models may not provide a reliable single measure of the fair value of the employee stock options. Management assesses the assumptions and methodologies used to calculate estimated fair value of stock-based compensation when share-based awards are granted. Circumstances may change and additional data may become available over time, which could result in changes to these assumptions and methodologies and thereby materially impact our fair value determination. If an employee leaves the firm before the vesting period has been met, those shares are forfeited and removed from the share – based compensation expense calculation. See Note 11 for additional share-based compensation information.

 

Restricted share and share unit awards are recognized at their fair value. The amount of compensation cost is measured on the grant date fair value of the equity instrument issued. The compensation cost of the restricted share and share unit awards is recognized over the vesting period of the restricted share and share unit awards on a straight-line basis. Restricted share and share unit awards typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period assuming the grantee’s restricted share or share unit award fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. Dividends for restricted share and share unit awards that ultimately do not vest are forfeited.

 

F- 18

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

Advertising Costs

 

Advertising costs are expensed as incurred. Total advertising expense was $719 and $781 for the fiscal years ended December 28, 2024 and December 30, 2023, respectively.

 

Fair Value Measurements

 

The Company values its financial assets and liabilities based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  In order to increase consistency and comparability in fair value measurements, a fair value hierarchy was established that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

 

Level 1:  Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.  The fair value hierarchy gives the highest priority to Level 1 inputs.

 

Level 2:  Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in inactive markets; or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data.

 

Level 3:  Unobservable inputs are used when little or no market data is available.  The fair value hierarchy gives the lowest priority to Level 3 inputs.

 

In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value.

2.

FISCAL YEAR

 

The Company follows a 52/53 week fiscal reporting calendar ending on the Saturday closest to December 31. The fiscal years ended December 28, 2024 (fiscal 2024) and December 30, 2023 (fiscal 2023) consisted of fifty-two weeks each.

 

F- 19

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

3.

USE OF ESTIMATES AND UNCERTAINTIES

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.

 

The Company uses estimates to determine a provision for credit losses on its accounts receivable, contingent consideration, litigation, medical claims, vacation, goodwill impairment, if any, equity compensation, the tax rate applied and the valuation of certain assets and liability accounts. In addition, the Company reviews its estimated costs to complete a contract and adjusts those costs when necessary. These estimates can be significant to the operating results and financial position of the Company. The estimates are based upon various factors including current and historical trends, as well as other pertinent industry and regulatory authority information. Management regularly evaluates this information to determine if it is necessary to update the basis for its estimates and to adjust for known changes.

 

The Company has risk participation arrangements with respect to workers compensation and healthcare insurance. The amounts included in the Company’s costs related to this risk participation are estimated and can vary based on changes in assumptions, the Company’s claims experience or the providers included in the associated insurance programs.

 

The Company can be affected by a variety of factors including uncertainty relating to the performance of the general economy, competition, demand for the Company’s services, adverse litigation and claims and the hiring, training and retention of key employees.

 

F- 20

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

4.    ACCOUNTS RECEIVABLE

 

The Company’s accounts receivable are comprised as follows:

 

		December 28, 2024				December 30, 2023
Billed		$	55,224			$	51,111
Unbilled			16,931				14,737
Work-in-progress			7,375				6,442
Provision for credit losses			(1,570	)			(1,600	)
Accounts receivable, net		$	77,960			$	70,690

 

Unbilled receivables primarily represent revenue earned whereby those services are ready to be billed as of the balance sheet ending date. Work-in-progress primarily represents revenue earned under contracts which the Company contractually invoices at future dates.

5.    PROPERTY AND EQUIPMENT

 

Property and equipment are comprised of the following:

 

		December 28, 2024				December 30, 2023
Computers and systems		$	8,448			$	5,512
Equipment and furniture			306				262
Leasehold improvements			590				413
Laboratory equipment			196				173
			9,540				6,360
Less: accumulated depreciation and amortization			2,172				2,355
Property and equipment, net		$	7,368			$	4,005

 

The Company periodically writes off fully depreciated and amortized assets.  The Company wrote off fully depreciated and amortized assets of $1,604 and $1,201 during the fiscal years ended December 28, 2024 and December 30, 2023, respectively. For the fiscal years ended December 28, 2024 and December 30, 2023, depreciation and amortization expense for property and equipment was $1,419 and $1,032, respectively.

 

F- 21

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

6.    ACQUISITIONS AND DIVESTITURES

 

The purchase method of accounting in accordance with FASB ASC 805, “Business Combination,” was applied for all acquisitions. This requires the cost of an acquisition to be allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair values at the date of acquisition with the excess cost accounted for as goodwill. Goodwill arising from the acquisitions is attributable to expected sales synergies from combining the operations of the acquired business with those of the Company.

 

Potential future contingent payments to be made to all active acquisitions after December 28, 2024 are capped at a cumulative maximum of $0.2 million.

 

The changes in the liability for contingent consideration from acquisitions for the fiscal years ended December 28, 2024 and December 30, 2023 are as follows:

 

Balance as of December 31, 2022		$	2,442
Contingent payments - cash			(339	)
Contingent payments - stock			(132	)
Balance as of December 30, 2023		$	1,971
Remeasurement of contingent consideration			(1,759	)
Balance as of December 28, 2024		$	212

 

 

Future Contingent Payments

As of December 28, 2024, the Company had one acquisition agreement whereby additional contingent consideration may be earned by the sellers: effective September 30, 2018, the Company acquired certain assets of Thermal Kinetics Engineering, PLLC and Thermal Kinetics Systems, LLC. The Company estimates future contingent payments at December 28, 2024 as follows:

 

		Total
Payable in fiscal 2025		$	212

 

For acquisitions that involve contingent consideration, the Company records a liability equal to the fair value of the estimated contingent consideration obligation as of the acquisition date. The Company determines the acquisition date fair value of the contingent consideration based on the likelihood of paying the additional consideration. The fair value is estimated using projected future operating results and the corresponding future earn-out payments that can be earned upon the achievement of specified operating objectives and financial results by acquired companies using Level 3 inputs and the amounts are then discounted to present value. These liabilities are measured quarterly at fair value, and any change in the fair value of the contingent consideration liability is recognized in the consolidated statements of operations. During the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding adjustment to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recognized in the consolidated statements of operations.

 

F- 22

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

6.    ACQUISITIONS AND DIVESTITURES (CONTINUED)

 

Estimates of future contingent payments are subject to significant judgment and actual payments may materially differ from estimates.  The Company estimates future contingent consideration payments based on forecasted performance and recorded the fair value of those expected payments as of December 28, 2024.  Contingent consideration related to acquisitions is recorded at fair value (level 3) with changes in fair value recorded in operating expense.

 

Divestiture of Assets

On July 30, 2021, the Company sold the principal assets and certain liabilities of its Pickering and Kincardine offices in Ontario, Canada.  These two offices were often called Canada Power Systems and principally provided engineering services to two major nuclear power providers in Canada.  The two Canada Power Systems offices were part of a reporting unit within the Company’s Engineering segment.  The purchase agreement provided for a typical indemnity escrow held by an independent escrow agent.  The net proceeds released from the escrow account generated a gain on sale of assets of $0.4 million for the year ended December 30, 2023.   

 

7.    GOODWILL

 

Goodwill represents the premium paid over the fair value of the net tangible and intangible assets acquired in business combinations.  The Company tests goodwill for impairment on an annual basis as of the last day of the Company's fiscal year or more frequently if events occur or circumstances change indicating that the fair value of goodwill may be below the carrying amount.  The Company reviewed industry and market conditions, reporting unit specific events as well as overall financial performance and determined that no indicators of impairment of goodwill existed in its Engineering and Specialty Health Care segments during the fiscal year ended December 28, 2024 and for all segments during the year ended December 30, 2023.  Since the Company remeasured contingent consideration associated with its Life Sciences, Data and Solutions segment, the Company determined that further testing was necessary. After comparing the fair value of the Life Sciences, Data and Solutions segment to its carrying amount, the Company determined that no impairment loss occurred for the Company’s goodwill during the fiscal years ended December 28, 2024 or December 30, 2023.

 

The changes in the carrying amount of goodwill for the fiscal years ended December 28, 2024 and December 30, 2023 are as follows:

 

		Engineering				Specialty Health Care				Life Sciences, Data & Solutions				Total
Balance as of December 31, 2022		$	11,918			$	2,398			$	7,831			$	22,147
No change in fiscal 2023			-				-				-				-
Balance as of December 30, 2023		$	11,918			$	2,398			$	7,831			$	22,147
No change in fiscal 2024			-				-				-				-
Balance as of December 28, 2024		$	11,918			$	2,398			$	7,831			$	22,147

 

F- 23

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

8.    INTANGIBLE ASSETS

 

The Company evaluates long-lived assets and intangible assets with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  When the Company determines that it is probable that undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value.  Assets to be disposed of by sale, if any, are reported at the lower of the carrying amount or fair value less cost to sell.  The Company’s intangible assets historically consist of customer relationships and non-compete agreements.  The Company determined that during the fiscal year ended December 28, 2024, its intangible asset balance became worthless and was written off.

 

The changes in the carrying amount of intangible assets for the fiscal years ended December 28, 2024 and December 30, 2023 are as follows:

 

		Engineering				Specialty Health Care				Life Sciences, Data & Solutions				Total
Balance as of December 31, 2022		$	-			$	-			$	865			$	865
Amortization in fiscal 2023			-				-				182				182
Balance as of December 30, 2023		$	-			$	-			$	683			$	683
Amortization in fiscal 2024			-				-				136				136
Impairment in fiscal 2024			-				-				547				547
Balance as of December 28, 2024		$	-			$	-			$	-			$	-

 

9.    LINE OF CREDIT

 

On December 3, 2024, the Company entered into a Fifth Amended and Restated Loan Agreement (the “Fifth Amended and Restated Loan Agreement”) with Citizens Bank, N.A., as lender (in such capacity, the “Lender”) and as administrative agent and arranger (in such capacity, the “Administrative Agent”), to amend and restate in its entirety that certain Fourth Amended and Restated Agreement dated as of April 24, 2023 (as the same has been amended and modified prior to the date hereof, the “Existing Loan Agreement”). 

 

The Fifth Amended and Restated Loan Agreement is increased from $45.0 million under the Fourth Amended and Restated Agreement to $65.0 million (with an accordion feature permitting the increase of the total commitment by an additional $20.0 million, subject to the consent of the Administrative Agent and the Lenders), and permits the Borrowers to request the issuance of trade and standby letters of credit thereunder. The Fifth Amended and Restated Loan Agreement has a maturity date of December 3, 2029.

 

Borrowings under the Revolving Credit Facility bear interest at one of two alternative rates, as selected by the Company at each incremental borrowing.  These alternatives are: (i) SOFR (Secured Overnight Financing Rate), plus applicable margin or (ii) the agent bank’s prime rate generally borrowed over shorter durations.  The Company also pays unused line fees based on the amount of the Revolving Credit Facility that is not drawn.  Unused line fees are recorded as interest expense. The effective weighted average interest rate, including unused line fees, for the fiscal years ended December 28, 2024 and December 30, 2023 were 6.6% and 6.5%, respectively.

 

F- 24

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

9.    LINE OF CREDIT (CONTINUED)

 

All borrowings under the Fifth Amended and Restated Loan Agreement remain collateralized with substantially all of the Company’s assets, as well as the capital stock of its subsidiaries. The Revolving Credit Facility also contains various financial and non-financial covenants, such as a covenant that restricts the Company’s ability to borrow in order to pay dividends. As of December 28, 2024, the Company was in compliance with all covenants contained in the Revolving Credit Facility. The Company believes that it will maintain compliance with its financial covenants for the foreseeable future.

 

Borrowings under the line of credit as of December 28, 2024 and December 30, 2023 were $35.0 million and $30.8 million, respectively. There were letters of credit outstanding at December 28, 2024 and December 30, 2023 for $7.4 million and $2.0 million, respectively. At December 28, 2024 and December 30, 2023, the Company had availability for additional borrowings under the Revolving Credit Facility of $22.6 million and $12.1 million, respectively.

 

10.  PER SHARE DATA

 

The Company uses the treasury stock method to calculate the weighted-average shares outstanding used for diluted earnings per share. The number of weighted-average shares used to calculate basic and diluted earnings per share for the fiscal years ended December 28, 2024 and December 30, 2023 was determined as follows:

 

		Fiscal Years Ended
		December 28, 2024				December 30, 2023
Basic weighted average shares outstanding			7,737,063				8,308,867
Dilutive effect of outstanding restricted share awards			202,318				283,705
Diluted weighted average shares outstanding			7,939,381				8,592,572

 

For the fiscal years ended December 28, 2024 and December 30, 2023, there were no anti-dilutive shares included in the calculation of common stock equivalents as there were no stock options outstanding.

 

Unissued shares of common stock were reserved for the following purposes:

 

		December 28, 2024				December 30, 2023
Time-based restricted stock awards outstanding			289,421				376,618
Performance-based restricted stock awards outstanding			300,000				100,000
Future grants of options or shares			295,680				603,044
Shares reserved for employee stock purchase plan			252,119				297,730
Total			1,137,220				1,377,392

 

F- 25

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

  

11.   SHARE BASED COMPENSATION

 

At December 28, 2024, the Company had two share-based employee compensation plans, the Employee Stock Purchase Plan and the 2014 Omnibus Equity Compensation Plan.

 

The Company measures the fair value of share-based awards, if and when granted, based on the Black-Scholes method and using the closing market price of the Company’s common stock on the date of grant. Awards typically vest over periods ranging from one to five years and expire within 10 years of issuance. The Company may also issue immediately vested equity awards. Share-based compensation expense related to time-based awards is amortized in accordance with applicable vesting periods using the straight-line method. The Company expenses performance-based awards only when the performance metrics are likely to be achieved and the associated awards are therefore likely to vest. Performance-based share awards that are likely to vest are also expensed on a straight-line basis over the vesting period but may vest on a retroactive basis or be reversed, depending on when it is determined that they are likely to vest, or in the case of a reversal when they are later determined to be unlikely to vest or forfeited. Discussion of share and share-based awards herein references awards of shares and share units.

 

Share-based compensation expense of $2.9 million and $2.1 million was recognized for the fiscal years ended December 28, 2024 and December 30, 2023, respectively. Share-based compensation for performance-based equity agreements was $1.6 million and $0.7 million for the fiscal years ended December 28, 2024 and December 30, 2023, respectively. As of December 28, 2024, there were 300,000 performance-based restricted stock awards outstanding. Share-based compensation expense is included in selling, general and administrative expense in the Company’s statement of operations.

 

As of December 28, 2024, the Company had $8.0 million of total unrecognized compensation cost, with approximately $2.6 million related to time-based non-vested share-based awards outstanding and $5.4 million related to performance-based non-vested share-based awards outstanding. The Company expects to recognize the expense associated with time-based non-vested share-based awards through fiscal 2029.  If earned, the Company will recognize the expense associated with performance-based non-vested share-based awards straight-line through fiscal 2027.  These amounts do not include a) the cost of any additional share-based awards granted in future periods or b) the impact of any potential changes in the Company’s forfeiture rate. 

 

Incentive Share-Based Plans

 

Employee Stock Purchase Plan

 

The Company implemented the 2001 Employee Stock Purchase Plan (the “Purchase Plan”) with shareholder approval, effective January 1, 2001. Under the Purchase Plan, employees meeting certain specific employment qualifications are eligible to participate and can purchase shares of common stock semi-annually through payroll deductions at the lower of 85% of the fair market value of the stock at the commencement or end of the offering period. The purchase plan permits eligible employees to purchase shares of common stock through payroll deductions for up to 10% of qualified compensation, subject to maximum purchases in any one fiscal year of 3,000 shares.

 

F- 26

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

11.   SHARE BASED COMPENSATION (CONTINUED)

 

Employee Stock Purchase Plan (Continued)

 

In fiscal 2015, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Purchase Plan by an additional 300,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,100,000 shares and to extend the expiration date of the Purchase Plan to December 31, 2025. In fiscal 2018, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Purchase Plan by an additional 300,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,400,000 shares. In fiscal 2021, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Purchase Plan by an additional 400,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,800,000 shares and the termination date of the Purchase Plan was extended to December 31, 2030.

 

The Company has two offering periods in the Purchase Plan coinciding with the Company’s first two fiscal quarters and the last two fiscal quarters. Actual shares are issued on the first business day of the subsequent offering period for the prior offering period payroll deductions. During the fiscal years ended December 28, 2024 and December 30, 2023, there were 45,611 and 66,501 shares issued under the Purchase Plan for net proceeds of $0.7 million and $0.7 million, respectively. As of December 28, 2024, there were 252,119 shares available for issuance under the Purchase Plan. Compensation expense, representing the discount to the quoted market price, for the Purchase Plan for the fiscal years ended December 28, 2024 and December 30, 2023 was $0.3 million and $0.3 million, respectively.

 

2014 Omnibus Equity Compensation Plan (the 2014 Plan)

 

The 2014 Plan, approved by the Company’s shareholders in December 2014, initially provided for the issuance of up to 625,000 shares of the Company’s common stock to officers, non-employee directors, employees of the Company and its subsidiaries, or consultants and advisors utilized by the Company.  In fiscal 2016, fiscal 2020 and fiscal 2022, the Company amended, or amended and restated, the 2014 Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance under the Plan by an additional 500,000, 850,000 and 1,000,000 shares, respectively, so that the total number of shares of stock reserved for issuance under the Plan is 2,975,000 shares.  The expiration date of the Plan is December 17, 2030, unless the 2014 Plan is terminated earlier by the Board or is extended by the Board with the approval of the stockholders.  The Compensation Committee of the Board of Directors determines the vesting period at the time of grant.

 

All stock awards typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period assuming the grantee’s stock award fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. As of December 28, 2024, there were no accrued dividends. Dividends for stock awards that ultimately do not vest are forfeited.

 

F- 27

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

11.   SHARE BASED COMPENSATION (CONTINUED)

 

2014 Omnibus Equity Compensation Plan (the 2014 Plan) (Continued)

 

As of December 28, 2024, under the 2014 Plan, 289,421 time-based shares were outstanding, 300,000 performance-based restricted stock awards were outstanding and 295,680 shares were available for awards thereunder.

 

The intrinsic value of all equity grants as of December 28, 2024 and December 30, 2023 was $12.5 million and $13.8 million, respectively. These amounts are based on the equity price on the last trading day in the period presented.

 

Time-Based Restricted Stock Awards

 

From time-to-time the Company issues time-based restricted stock awards. The following summarizes the activity in the time-based restricted stock awards under the 2014 Plan during the fiscal year ended December 28, 2024:

 

		Number of Time-Based Restricted Stock Awards				Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 31, 2022			274,939			$	3.59
Granted			293,978			$	13.23
Vested			(181,197	)		$	2.83
Forfeited or expired			(11,102	)		$	2.23
Outstanding non-vested at December 30, 2023			376,618			$	11.53
Granted			19,676			$	22.62
Vested			(101,401	)		$	10.32
Forfeited or expired			(5,472	)		$	14.62
Outstanding non-vested at December 28, 2024			289,421			$	12.65

 

Based on the closing price of the Company’s common stock of $23.17 per share on December 27, 2024 (the last trading day prior to December 28, 2024), the intrinsic value of the time-based non-vested restricted stock awards at December 28, 2024 was approximately $6.7 million. As of December 28, 2024, there was approximately $2.6 million of total unrecognized compensation cost related to time-based restricted stock awards, which is expected to be recognized over the average weighted remaining vesting period of the restricted stock awards through fiscal 2029.

 

F- 28

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

11.   SHARE BASED COMPENSATION (CONTINUED)

 

Performance-Based Restricted Stock Awards

 

From time-to-time the Company issues performance-based restricted stock awards to its employees.  Performance-based restricted stock awards are typically vested based on certain multi-year performance metrics as determined by the Board of Directors Compensation Committee.

 

The following summarizes the activity in the performance-based restricted stock awards during the fiscal year ended December 28, 2024:

 

		Number of Performance- Based Restricted Stock Awards				Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 31, 2022			225,000			$	8.73
Granted			-				-
Vested			(125,000	)		$	6.15
Forfeited or expired			-				-
Outstanding non-vested at December 30, 2023			100,000			$	11.96
Granted			300,000			$	28.79
Vested			(62,500	)		$	11.96
Forfeited or expired			(37,500	)		$	11.96
Outstanding non-vested at December 28, 2024			300,000			$	28.79

 

The Company assesses at each reporting date whether achievement of any performance condition is probable and recognizes the expense when achievement of the performance condition becomes probable.  The Company will then recognize the appropriate expense cumulatively in the year performance becomes probable and recognize the remaining compensation cost over the remaining requisite service period. If at a later measurement date, the Company determines that performance-based restricted stock awards deemed as likely to vest are deemed as unlikely to vest, the expense recognized will be reversed. 

 

Share-based compensation for performance-based equity agreement was $1.6 million and $0.7 million for the fiscal years ended December 28, 2024 and December 30, 2023, respectively. 

 

There were no immediately vested share awards during the fiscal year ended December 28, 2024. During the fiscal year ended December 30, 2023, the Company awarded 4,762 immediately vested share awards at an average price of $10.50.

 

F- 29

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

11.   SHARE BASED COMPENSATION (CONTINUED)

 

		Number of Restricted Stock Awards				Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 31, 2022			499,939			$	5.91
Granted – time-based vesting			293,978			$	13.23
Granted – performance-based vesting			-				-
Vested			(306,197	)		$	4.18
Forfeited or expired			(11,102	)		$	2.23
Outstanding non-vested at December 30, 2023			476,618			$	11.66
Granted – time-based vesting			19,676			$	22.62
Granted – performance-based vesting			300,000			$	28.79
Vested			(163,901	)		$	10.94
Forfeited or expired			(42,972	)		$	12.30
Outstanding non-vested at December 28, 2024			589,421			$	20.86

 

Based on the closing price of the Company’s common stock of $23.17 per share on December 27, 2024, the intrinsic value of all outstanding unvested equity awards at December 28, 2024 was $12.5 million.

 

12.   TREASURY STOCK TRANSACTIONS

 

On March 29, 2024, the Board authorized a program to repurchase shares of its common stock up to an amount not to exceed $50.0 million, inclusive of amounts remaining under the existing repurchase authorization. The program (the Treasury Stock Repurchase Plan) is designed to provide the Company with enhanced flexibility over the long term to optimize its capital structure.  Shares of the Common Stock may be repurchased in the open market or through negotiated transactions.  The program may be terminated or suspended at any time at the discretion of the Company. The Company may enter into a Rule 10b5-1 trading plan to effect a portion of the authorized purchases if the criteria set forth in the plan are met. Such a plan would enable the Company to repurchase its shares during periods outside of its normal trading windows when the Company typically would not be active in the market.

 

On April 24, 2023, the Company agreed to repurchase, in a private transaction approved by the Board, 333,686 shares of common stock at a per-share price of $11.91 per share.

 

During the fiscal year ended December 28, 2024, the Company purchased 407,653 shares at an average price of $19.08 per share. During the fiscal year ended December 30, 2023, the Company purchased 1,825,957 shares at an average price of $14.00 per share. As of December 28, 2024, the Company has $42.2 million available for future treasury stock purchases.

 

The Company accrued $25 in excise tax associated with its Treasury Stock Repurchase Plan during the fiscal year ended December 28, 2024. Excise tax is recorded directly to additional paid-in capital.

 

F- 30

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

13.   NEW ACCOUNTING STANDARDS

 

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements through enhanced disclosures about significant segment expenses. The amendments require disclosure of significant segment expenses regularly provided to the chief operating decision maker (CODM) as well as other segment items, extend certain annual disclosures to interim periods, clarify the applicability to single reportable segment entities, permit more than one measure of profit or loss to be reported under certain conditions, and require disclosure of the title and position of the CODM. We adopted this ASU for the fiscal year ended December 28, 2024.

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires the annual financial statements to include consistent categories and greater disaggregation of information in the rate reconciliation, and income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for the Company’s annual reporting periods beginning after December 15, 2024, with early adoption permitted, and should be applied on a prospective basis, with a retrospective option. We are currently evaluating the effect that adoption of this ASU will have on our disclosures.

 

F- 31

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023 (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

14.   SEGMENT INFORMATION

 

The Company follows ASC 280, “Segment Reporting,” which establishes standards for companies to report information about operating segments, geographic areas and major customers. The accounting policies of each reportable segment are the same as those described in the summary of significant accounting policies (see Note 1 to the Company’s Consolidated Financial Statements).

 

The Company reports segment information based on the management approach, which designates the internal reporting used by the Chief Operating Decision Makers (“CODMs”), who were Bradley Vizi, Chief Executive Officer, and Kevin Miller. Chief Financial Officer. The Company’s CODMs are responsible for making decisions regarding the Company’s business, including resource allocations and performance assessments based on historical and future segment revenue, operating expenses, and operating income (loss) before interest and taxes.

 

The tables below summarize the results of operations and total assets by segment provided to the CODMs. Segment operating income (loss) includes selling, general, and administrative expenses directly attributable to that segment and charges for allocating corporate costs to each of the operating segments. Please refer to the segment discussion on pages 34 and 35 of the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of this Annual Report on Form 10-K.

 

Fiscal Year Ended December 28, 2024		Specialty Health Care				Engineering				Life Sciences, Data & Solutions				Corporate				Total
Revenue		$	142,679			$	96,459			$	39,242			$	-			$	278,380
Cost of services			100,146				73,916				24,540				-				198,602
Gross profit			42,533				22,543				14,702				-				79,778
Selling, general and administrative			30,326				17,355				9,106				-				56,787
Depreciation and amortization of property and equipment			525				706				188				-				1,419
Amortization of acquired intangible assets			-				-				683				-				683
Potential stock issuance and financing transactions			-				-				-				323				323
Remeasurement of contingent consideration			-				-				(1,759	)			-				(1,759	)
Operating income		$	11,682			$	4,482			$	6,484			$	(323	)		$	22,325
Total assets as of December 28, 2024		$	43,180			$	52,160			$	22,210			$	14,527			$	132,077
Property and equipment acquired		$	296			$	691			$	28			$	1,557			$	2,572

 

F- 32

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

14.   SEGMENT INFORMATION (CONTINUED)

 

Fiscal Year Ended December 30, 2023		Specialty Health Care				Engineering				Life Sciences, Data & Solutions				Corporate				Total
Revenue		$	136,241			$	84,675			$	42,321			$	-			$	263,237
Cost of services			96,309				64,071				26,161				-				186,541
Gross profit			39,932				20,604				16,160				-				76,696
Selling, general and administrative			26,010				16,964				9,211				-				52,185
Depreciation and amortization of property and equipment			383				504				145				-				1,032
Amortization of acquired intangible assets			-				-				182				-				182
Gain on sale of assets			-				(395	)			-				-				(395	)
Operating income (loss)		$	13,539			$	3,531			$	6,622			$	-			$	23,692
Total assets as of December 30, 2023		$	43,769			$	46,425			$	18,586			$	11,704			$	120,484
Property and equipment acquired		$	141			$	724			$	123			$	1,943			$	2,931

 

 

The Company derives a majority of its revenue from offices in the United States. Revenue reported for each operating segment are all from external customers. The Company is domiciled in the United States and its segments operate in the United States, Canada, Germany, Philippines, Puerto Rico and Europe. The Company does not derive any revenue in the Philippines. Revenue by geographic area for the fiscal years ended December 28, 2024 and December 30, 2023 are as follows:

 

 

		Fiscal Year Ended
		December 28,				December 30,
		2024				2023
Revenue
United States		$	256,759			$	246,578
Canada			7,196				6,480
Puerto Rico			7,017				6,515
Europe			7,408				3,664
Philippines			-				-
		$	278,380			$	263,237

 

F- 33

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

14.   SEGMENT INFORMATION (CONTINUED)

 

Total assets by geographic area as of the reported periods are as follows:

 

		Fiscal Year Ended
		December 28,				December 30,
		2024				2023
Total Assets
United States		$	123,905			$	110,781
Canada			1,423				1,880
Puerto Rico			3,286				3,476
Europe			3,408				4,347
Philippines			55				-
		$	132,077			$	120,484

 

15.   INCOME TAXES

 

Generally, the Company’s relative income or loss generated in each of its jurisdictions can materially impact the consolidated effective income tax rate of the Company, particularly the ratio of Canadian and Serbian pretax income, versus United States pretax income. The consolidated effective income tax rate for fiscal years ended December 28, 2024 and December 30, 2023 were 34.0% and 24.2%, respectively.  The Company’s United States Federal statutory tax rate for fiscal years ended December 28, 2024 and December 30, 2023, before any adjustments, was 21.0%.  The income tax provisions reconciled to the tax computed at the United States Federal statutory rate for fiscal years 2024 and 2023 are as follows:

 

		December 28, 2024								December 30, 2023
		Amount				% of Earnings Before Taxes				Amount				% of Earnings Before Taxes
Tax expense on taxable income at federal statutory rate		$	4,240				21.0			$	4,661				21.0
State and Puerto Rico income taxes, net of Federal income tax benefit			1,164				5.8				1,082				4.9
Permanent differences domestic and foreign			188				0.9				(269	)			(1.2	)
Intangible asset deferred liability true-up			797				4.0				-				-
Foreign income tax rates			108				0.5				25				0.1
Foreign tax adjustment			174				0.9				-				-
Other			191				0.9				(135	)			(0.6	)
Total income tax expense		$	6,863				34.0			$	5,364				24.2

 

 

F- 34

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

15.   INCOME TAXES (CONTINUED)

 

The components of income tax expense (benefit) are as follows:

 

		Fiscal Years Ended
		December 28, 2024				December 30, 2023
Current
Federal		$	2,609			$	3,055
State and local			611				1,608
Foreign			942				660
			4,162				5,323
Deferred
Federal			2,343				217
State			611				(143	)
Foreign			(253	)			(33	)
			2,701				41
Total		$	6,863			$	5,364

 

 

The components of earnings before income taxes by United States and foreign jurisdictions were as follows:

 

		Fiscal Years Ended
		December 28, 2024				December 30, 2023
United States and Puerto Rico		$	16,607			$	19,333
Foreign jurisdictions			3,583				2,862
		$	20,190			$	22,195

 

 

A reconciliation of the unrecognized tax benefits for the years December 28, 2024 and December 30, 2023:

 

Unrecognized Tax Benefits
Balance as of December 31, 2022		$	1,196
Gross increases: tax positions in prior period			-
Gross increases: tax positions in current period			-
Balance as of December 30, 2023		$	1,196
Gross increases: tax positions in prior period			-
Gross increases: tax positions in current period			-
Balance as of December 28, 2024		$	1,196

 

 

F- 35

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

15.   INCOME TAXES (CONTINUED)

 

The total amount of unrecognized tax benefits relating to the Company’s tax positions is subject to change based on future events including, but not limited to, the settlements of ongoing audits and/or the expiration of applicable statutes of limitations. Although the outcomes and timing of such events are highly uncertain, it is reasonably possible that the balance of gross unrecognized tax benefits will not change during the next 12 months. However, changes in the occurrence, expected outcomes and timing of those events could cause the Company’s current estimate to change materially in the future.

 

The Company accounts for penalties or interest related to uncertain tax positions as part of its provision for income taxes and records such amounts to tax expense.  The Company recorded no expense for penalties or interest in the fiscal years ended December 28, 2024 and December 30, 2023.

 

At December 28, 2024 and December 30, 2023, deferred tax assets and liabilities consist of the following:

 

		December 28, 2024				December 30, 2023
Deferred tax assets:
Provision for credit losses		$	400			$	421
Federal and state net operating loss carryforward			41				48
Compensation			836				747
Reserves, accruals, and other			461				760
Lease liability			1,304				777
Net operating loss carryforward, Germany			120				55
Total deferred tax assets			3,162				2,808
Deferred tax liabilities:
Intangible assets, net of amortization			(4,272	)			(1,860	)
Prepaid expense deferral			(1,146	)			(1,044	)
Fixed assets, net of depreciation			(906	)			(689	)
Right of use assets			(1,244	)			(728	)
Deferred tax liability, net, Canada			-				(187	)
Total deferred tax liabilities			(7,568	)			(4,508	)
Total deferred tax (liabilities) assets, net		$	(4,406	)		$	(1,700	)

 

The Company has gross state net operating losses of $0.6 million and foreign net operating losses of $0.4 million to be applied to the net income of future tax returns, respectively.  The state net operating losses are subject to various expiration periods.  The foreign net operating losses have an indefinite carryforward period.

 

The Company conducts its operations in multiple tax jurisdictions in the United States, Canada, Germany, Philippines, Puerto Rico and Serbia. The Company and its subsidiaries file a consolidated United States Federal income tax return and file in various states. The Company has no open Federal audits as of December 28, 2024. Except for limited exceptions, the Company is no longer subject to audits by state and local tax authorities for tax years prior to 2020. The Company is no longer subject to audit in Canada for the tax years prior to tax year 2020. The Company is under audit in Canada for tax years 2021 and 2022. The Company is no longer subject to audit in Puerto Rico for the tax years prior to tax year 2019.

 

Differences between the effective tax rate and the applicable U.S. federal statutory rate may arise, primarily from the effect of state and local income taxes, and share-based compensation. The actual 2024 effective tax rate may vary from the estimate depending on the actual operating income earned in various jurisdictions, and the exercise of stock options and vesting of share-based awards.

 

F- 36

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

15.   INCOME TAXES (CONTINUED)

 

Under APB 23, foreign earnings are generally not subject to U.S. tax until repatriated or deemed repatriated under the anti-deferral rules.  The Company has determined that as of December 28, 2024, all current and future earnings in its foreign subsidiaries will be permanently reinvested.   Based on this determination, the anti-deferral rules have no material impact on the Company.

 

16.

CONTINGENCIES

 

From time to time, the Company is a defendant in various legal actions that arise in the ordinary business course.  These matters may relate to professional liability, tax, compensation, contract, competitor disputes, and employee-related matters and include individual and class action lawsuits, as well as inquiries and investigations by governmental agencies regarding the Company’s employment and compensation practices. Additionally, some of the Company’s clients may also become subject to claims, governmental inquiries and investigations, and legal actions relating to the Company’s professional services. Depending upon the particular facts and circumstances, the Company may also be subject to indemnification obligations under its contracts with such clients relating to these matters.

 

As such, the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of losses and possible recoveries.  The Company may not be covered by insurance as it pertains to some or all of these matters.  A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter.  The Company records a liability when management believes an adverse outcome from a loss contingency is both probable and the amount, or a range, can be reasonably estimated. From time to time, the Company must estimate the potential loss even though the party adverse to the Company has not asserted any specific amounts. Significant judgment is required to determine both the probability of loss and the estimated amount. The Company reviews its loss contingencies at least quarterly and it adjusts its accruals and/or disclosures to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, or other new information, as deemed necessary. Once established, a provision may change in the future due to new developments or changes in circumstances. The Company could increase or decrease its earnings in the period that the changes are made. 

 

The Company is exposed to various asserted claims as of December 28, 2024, where the Company believes it has a probability of loss. Additionally, the Company is exposed to other asserted claims whereby an amount of loss has not been declared, and the Company cannot determine the potential loss. Any of these various claims could result in an unfavorable outcome or settlement that exceeds the accrued amounts. However, the Company believes that such matters will not, either individually or in the aggregate, have a material adverse effect on its business, consolidated financial position, results of operations, or cash flows. As of December 28, 2024, the Company has accrued $2.8 million for asserted claims. 

 

In April 2022, a client of the Company’s Engineering segment alleged that a system partially designed by the Company is not operating as intended and that the Company is responsible. The Company has not determined if it has any liability. In the event of liability, the Company believes its damages are contractually limited to an amount no higher than $3.3 million. Furthermore, the Company believes that if it were found liable, any damages would be covered by insurance, subject to a deductible of $0.5 million and maximum coverage of $5.0 million. While the clients estimated damages are not known, the client has either inferred or asserted during settlement discussions that it’s damages significantly exceed the Company’s insurance coverage of $5 million. While the Company attempts to find a mutually agreeable solution, the Company has reserved $0.5 million for this project. The Company can give no assurance that its liability is limited to $3.3 million or that liability over $0.5 million, if any, will be covered by insurance.

 

F- 37

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

16.

CONTINGENCIES (CONTINUED)

 

The Company is also subject to other pending legal proceedings and claims that arise from time to time in the ordinary course of its business, which may not be covered by insurance.

 

17.   RETIREMENT PLANS

 

Profit Sharing Plans

 

The Company maintains a 401(k) profit sharing plan for the benefit of eligible employees in the United States and other similar plans in Canada, Philippines, Puerto Rico and Serbia (the “Retirement Plans”). The 401(k) plan includes a cash or deferred arrangement pursuant to Section 401(k) of the Internal Revenue Code sponsored by the Company to provide eligible employees an opportunity to defer compensation and have such deferred amounts contributed to the 401(k) plan on a pre-tax basis, subject to certain limitations. The Company, at the discretion of the Board of Directors, may make contributions of cash to match deferrals of compensation by participants in the Retirement Plans. Contributions to the Retirement Plans charged to operations by the Company for the fiscal years ended December 28, 2024 and December 30, 2023 were $460 and $698, respectively.

 

18.   COMMITMENTS

 

Leases

 

Leases are recorded in accordance with FASB ASC 842, Leases which requires lessees to recognize a right of use (“ROU”) asset and an operating right of use liability for all leases with terms greater than 12 months and requires disclosures by lessees and lessors about the amount, timing and uncertainty of cash flows arising from leases.

 

The Company determines if an arrangement is a lease at inception. For leases where the Company is the lessee, right of use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent an obligation to make lease payments arising from the lease. Right of use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit interest rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The right of use asset also consists of any lease incentives received. The lease terms used to calculate the right of use asset and related lease liability include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating leases is recognized on a straight-line basis over the lease term as an operating expense while the expense for finance leases is recognized as depreciation expense and interest expense using the accelerated interest method of recognition. The Company has lease agreements which require payments for lease and non-lease components. The Company has elected to account for these as a single lease component with the exception of its real estate leases.

 

F- 38

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

18.   COMMITMENTS (CONTINUED)

 

Leases (Continued)

 

The components of lease expense were as follows:

 

		Fiscal Years Ended
		December 28, 2024				December 30, 2023
Operating lease cost		$	1,356			$	1,428
Finance lease cost
Amortization of right of use assets		$	594			$	484
Interest on lease liabilities			46				4
Total finance lease cost		$	640			$	488

 

 

Supplemental Cash Flow information related to leases was as follows:

 

		December 28, 2024				December 30, 2023
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases		$	1,214			$	1,464
Operating cash flows from finance leases		$	25			$	5
Financing cash flows from finance leases		$	595			$	462
Right of use assets obtained in exchange for lease obligations
Operating leases		$	3,407			$	33
Finance leases		$	2,172				-

 

F- 39

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

18.   COMMITMENTS (CONTINUED)

 

Leases (Continued)

 

Supplemental Balance Sheet information as of December 28, 2024 and December 30, 2023 related to leases was as follows:

 

		December 28, 2024				December 30, 2023
Operating leases
Operating lease right of use assets		$	5,174			$	2,779
Operating right of use liability - current		$	(1,046	)		$	(693	)
Operating right of use liability - non-current			(4,355	)			(2,268	)
Total operating lease liabilities		$	(5,401	)		$	(2,961	)
Finance leases
Property and equipment - (right of use assets)		$	2,172			$	926
Accumulated depreciation			(362	)			(695	)
Property and equipment, net		$	1,810			$	231
Finance lease liability - current		$	(698	)		$	(233	)
Finance lease liability - non-current			(1,112	)			-
Total finance lease liabilities		$	(1,810	)		$	(233	)
Weighted average remaining lease term in years
Operating leases			4.41				8.61
Finance leases			2.50				.50
Weighted average discount rate
Operating leases			6.36	%			3.15	%
Finance leases			4.88	%			0.87	%

 

 

F- 40

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RCM TECHNOLOGIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Fiscal Years Ended December 28, 2024 and December 30, 2023  (Dollars in thousands, except share and per share amounts, unless otherwise indicated)

 

18.   COMMITMENTS (CONTINUED)

 

Leases (Continued)

 

Maturities of lease liabilities are as follows:

 

Fiscal Year		Operating Leases				Finance Leases
2025			1,300				773
2026			1,213				773
2027			1,017				387
2028			966				-
2029			650				-
Thereafter			1,168				-
Total lease payments			6,314				1,933
Less: imputed interest			(913	)			(123	)
Total		$	5,401			$	1,810

 

19.   RELATED PARTY TRANSACTIONS

 

There have been no related party transactions during the periods presented.

 

F-41

Exhibit 10m

 

AMENDED AND RESTATED

EXECUTIVE SEVERANCE AGREEMENT

 

THIS AMENDED AND RESTATED EXECUTIVE SEVERANCE AGREEMENT (this “Agreement”), dated as of March 12, 2025, is made and entered by and between RCM Technologies, Inc., a Nevada corporation (the “Company”), and Bradley S. Vizi (the “Executive”).

 

WITNESSETH:

 

WHEREAS, Executive and the Company previously entered into that certain Executive Severance Agreement, dated as of June 1, 2018, (the “Prior Agreement”) in connection with the Company’s hiring Executive as the Executive Chairman and President of the Company;

 

WHEREAS, Executive is expected to continue to make major contributions to the short- and long-term profitability, growth and financial strength of the Company as the Executive Chairman and President of the Company;

 

WHEREAS, the Company desires to make certain amendments to the Prior Agreement in order to encourage the continued attention and dedication of Executive to his assigned duties without distraction;

 

WHEREAS, Executive has agreed to the amendments to the Prior Agreement that the Company has proposed in the event (i) Executive’s employment with the Company is terminated for a reason unrelated to a Change in Control (as defined below) of the Company, or (ii) of a Change in Control of the Company and Executive’s employment is terminated for a reason related to a Change in Control;

 

WHEREAS, Executive has agreed to reaffirm his continuing obligations to certain confidentiality, non-competition and non-solicitation covenants contained in the Prior Agreement and reflected hereunder, in consideration of his continued employment and the benefits provided to Executive in connection with the amendments to the Prior Agreement; and

 

WHEREAS, the Company and Executive have agreed that the amendments to the Prior Agreement be reflected in this Agreement, which is an amendment and restatement of the Prior Agreement and constitutes a written modification of the Prior Agreement pursuant to Section 21 of the Prior Agreement, and that this Agreement will supersede and replace the Prior Agreement in its entirety.

 

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements hereinafter set forth and intending to be legally bound hereby, the Company and Executive agree as follows:

 

 

 

1.    Certain Defined Terms. In addition to terms defined elsewhere herein, the following terms have the following meanings when used in this Agreement with initial capital letters:

 

(a)    “Annual Base Salary” means Executive’s annual base salary rate, exclusive of bonuses, commissions and other incentive pay, as in effect immediately preceding Executive’s Termination Date (but prior to taking into account any reduction that constitutes Good Reason).

 

(b)    “Beneficiary” means Executive’s spouse, if Executive has a spouse at the time of his death, or Executive’s estate, if Executive has no spouse at the time of his death.

 

(c)    “Board” means the Board of Directors of the Company.

 

(d)    “Bonus” means the greater of (i) the highest aggregate fair market value of vested RCM Stock that was issued to Executive in a fiscal year, in any of the five (5) fiscal years of the Company that immediately precede the Year of Termination or (ii) the aggregate fair market value of RCM Stock that would be issued to Executive in the fiscal year that immediately follows the Year of Termination, determined as of the date of grant if the performance goals are met at target for the performance grant awarded to Executive in the Year of Termination or, if no performance grant was made to Executive on the Termination Date for the fiscal year in which the Year of Termination occurs, the aggregate fair market value of RCM Stock that would be issued to Executive in the fiscal year of the Year of Termination, determined as of the date of grant if the performance goals are met at target for the performance grant awarded to Executive in the fiscal year that immediately precedes the Year of Termination. For the purposes of clause (i), (x) the aggregate fair market value of a share of RCM Stock in any fiscal year is determined as the fair market value of a share of RCM Stock on the vesting date in a fiscal year for such stock, multiplied by the total number of vested shares of RCM Stock issued to Executive as a result of such vesting, (y) the vested shares that are included in such determination for such fiscal year are solely the shares of RCM Stock that are actually delivered to Executive in the fiscal year on or following the applicable vesting date in such fiscal year, whether the vesting of such shares occurred because of the satisfaction of time- or performance-based vesting conditions, and whether as shares that have become vested or units that are converted to shares following the vesting date and (z) for clarity, the aggregate fair market value amongst the prior five (5) fiscal years is not aggregated across the fiscal years to determine the value for clause (i), but instead is the fiscal year that has the highest aggregate fair market value of vested RCM Stock issued to Executive.

 

(e)    “Cause” means Executive:

 

(i)    has engaged in (x) an act of dishonesty, (y) a breach of trust, or (z) conduct that constitutes gross neglect or gross misconduct in carrying out Executive’s duties, which act, breach or conduct, as applicable, results in material economic harm to the Company;

 

(ii)    is convicted of (or pleads guilty or nolo contendre to) a felony or a crime involving theft or embezzlement;

 

(iii)    willfully neglects, refuses or fails to substantially perform Executive’s material duties to the Company (other than a failure resulting from Executive’s incapacity due to physical or mental illness), which failure has continued for a period of at least thirty (30) days after a written notice of demand for substantial performance, signed by a duly authorized officer of the Company, has been delivered to Executive specifying the manner in which Executive has failed substantially to perform, without remedial action by Executive within such thirty (30) day period, unless such remedial action could not have been meaningful under the circumstances in the reasonable judgment of the Company, in which case no remedial period need be provided;

 

 

(iv)    intentional refusal or willful failure to carry out the reasonable instructions of the Board, which failure has continued for a period of at least thirty (30) days after a written notice of demand for substantial performance, signed by a duly authorized officer of the Company, has been delivered to Executive specifying the manner in which Executive has failed substantially to perform, without remedial action by Executive within such thirty (30) day period, unless such remedial action could not have been meaningful under the circumstances in the reasonable judgment of the Company, in which case no remedial period need be provided; or

 

(v)    breaches any written confidentiality, non-competition, or non-solicitation agreement, or any other material written agreement in effect with the Company, including without limitation the provisions of Section 7 of this Agreement.

 

(f)    “Change in Control” means the occurrence of any of the following events:

 

(i)    during any twelve (12) month period, the date on which individuals who at the beginning of such period constituted the Board cease for any reason to constitute at least a majority of the Board, unless each new director was approved by a vote of at least a majority of the directors then still on the Board who were members of the Board at the beginning of such period;

 

(ii)    the consummation of a merger, consolidation or reorganization approved by the Company’s stockholders, unless securities representing more than fifty percent (50%) of the total combined voting power of the voting securities of the successor corporation are immediately thereafter beneficially owned, directly or indirectly and in substantially the same proportion, by the persons who beneficially own the Company’s outstanding voting securities immediately prior to such transaction;

 

(iii)    the consummation of the sale or other disposition of all, or substantially all, of the Company’s assets; or

 

(iv)    any single transaction, or series of related transactions in a twelve (12) month period ending on the date of the initial transaction, pursuant to which any person or any group of persons comprising a “group” within the meaning of Rule 13d-5(b)(1) under the Securities Exchange Act of 1934, as amended (other than the Company or person that, prior to such transaction or series of related transactions, directly or indirectly controls, is controlled by or is under common control with, the Company) becomes directly or indirectly the beneficial owner (within the meaning of Rule 13d-3 of the Securities and Exchange Act of 1934, as amended) of more than fifty percent (50%) of the total combined voting power of the Company’s securities outstanding immediately after the consummation of such transaction or series of related transactions, whether such transaction involves a direct issuance from the Company or the acquisition of outstanding securities held by one or more of the Company’s stockholders.

 

Notwithstanding anything herein to the contrary, a “Change in Control” shall only be deemed to have occurred under this Agreement if the Change in Control constitutes a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company, within the meaning of section 409A(a)(2)(A)(v) of the Code and its corresponding regulations.

 

 

(g)    “Code” means the Internal Revenue Code of 1986, as amended.

 

(h)    “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended.

 

(i)    “Disability” means Executive’s inability, by reason of any verifiable physical or mental injury or illness or incapacity, and with or without reasonable accommodations, to substantially perform the services required of him by the Company for a continuous 90-day period or for 90 non-consecutive days within a continuous 180 day-period.

 

(j)    “Good Reason” means, without Executive’s consent,

 

(i)    a material diminution in Executive’s Annual Base Salary, other than in connection with an across-the-board, proportional reduction in annual base salary affecting all similarly-situated executives of the Company;

 

(ii)    a material diminution in Executive’s authority, duties or responsibilities;

 

(iii)    a requirement that that Executive report to a corporate officer or employee of the Company instead of reporting directly to the Board; or

 

(iv)    a material change in the geographic location at which Executive must perform services (i.e., more than thirty-five (35) miles from Executive’s employment location as of the date of this Agreement);

 

provided, however, that for Executive to be able to terminate his employment with the Company on account of Good Reason he must provide written notice of the occurrence of the event constituting Good Reason and his desire to terminate his employment with the Company on account of such within ninety (90) days following the initial existence of the condition constituting Good Reason, and the Company must have a period of thirty (30) days following receipt of such notice to cure the condition. If the Company does not cure the event constituting Good Reason within such thirty (30) day period, Executive’s Termination Date shall be the day immediately following the end of such thirty (30) day period, unless the Company provides for an earlier Termination Date.

 

(k)    “RCM Stock” means a share of common stock, par value $0.05 per share, of the Company.

 

(l)    “Termination Date” means the last day of Executive’s employment with the Company.

 

(m)    “Termination Related to a Change in Control” means (i) Executive’s employment with the Company is terminated within one hundred twenty (120) days prior to the date on which a Change in Control occurs, and Executive can reasonably demonstrate that such termination (x) was at the request of a third party who has taken steps reasonably calculated to effect a Change in Control or (y) otherwise arose in connection with a Change in Control, or (ii) Executive’s employment with the Company is terminated upon a Change in Control or within the twelve (12) month period following a Change in Control.

 

 

(n)    “Termination Unrelated to a Change in Control” means Executive’s employment with the Company is terminated at a time that such termination does not constitute a Termination Related to a Change in Control.

 

(o)    “Year of Termination” means the fiscal year of the Company in which the Termination Date occurs.

 

2.    Termination Unrelated to a Change in Control.

 

(a)    Involuntary Termination Unrelated to a Change in Control. In the event Executive’s employment is a Termination Unrelated to a Change in Control on account of: (i) an involuntary termination by the Company for any reason other than Cause, death or Disability, or (ii) Executive voluntarily terminates employment with the Company on account of a resignation for Good Reason, Executive shall be entitled to the benefits provided in subsection (b) of this Section 2.

 

(b)    Compensation on Account of Termination Unrelated to a Change in Control. Subject to the provisions of Section 5 hereof, in the event a termination described in subsection (a) of this Section 2 occurs, the Company shall provide Executive with the following, provided that Executive executes and does not revoke the Release (as defined in Section 5):

 

(i)    An amount equal to two (2.0) times the sum of Executive’s (x) Annual Base Salary and (B) Bonus, which amount shall be paid to Executive over the twelve (12) month period following Executive’s Termination Date; provided, that, subject to Section 17(b) of this Agreement, the first installment of such payment shall be paid to Executive on the first regularly scheduled Company payroll date that occurs after the 55th day following Executive’s Termination Date and such first installment shall cover the period between Executive’s Termination Date and the date of such first payment, and the remaining installments shall be paid to Executive on each subsequent regularly scheduled Company payroll date occurring after such payment for the remainder of such twelve (12) month period.

 

(ii)    For a period of eighteen (18) months following Executive’s Termination Date, Executive shall receive a monthly payment equal to the monthly COBRA premium that Executive is required to pay to continue medical, vision and dental coverage for himself, and, where applicable, his spouse and eligible dependents, under the medical, dental and vision plans of the Company in which Executive was participating immediately prior to this Termination Date; provided that to receive such monthly payment Executive must have elected COBRA coverage under such plans and pay the applicable monthly premium and not be eligible for such coverage under another employer’s plan. If Executive ceases to be eligible for COBRA continuation coverage as a result of not paying the applicable monthly premium or becomes eligible for coverage under another employer’s plan, the monthly payment described in this clause (ii) shall cease to be paid to Executive. Provided that Executive has satisfied the conditions to receive the monthly payments described in this clause (ii), subject to Section 17(b) of this Agreement, the first monthly payment shall be paid to Executive on the first regularly scheduled Company payroll date that occurs after the 55th day following Executive’s Termination Date and shall cover the first two months of such payment and the remaining monthly payments shall be paid to Executive on each subsequent regularly scheduled Company payroll date occurring after such monthly premium is required to be paid by Executive and shall continue for the remainder of such eighteen (18) month period, unless no further payment is due to Executive as described in this clause (ii).

 

 

(iii)    In addition to the foregoing, Executive shall receive any other amounts earned, accrued or owing but not yet paid to Executive prior to his Termination Date, and any other benefits in accordance with the terms of any applicable plans and programs of the Company; provided that Executive shall not be entitled to receive severance benefits under any Company severance plan.

 

3.    Termination on Account of a Change in Control.

 

(a)    Change in Control Termination. In the event Executive’s employment is a Termination Related to a Change in Control on account of (i) an involuntary termination by the Company for any reason other than Cause, death or Disability; (ii) an involuntary termination by the Company within the twelve (12) month period following a Change in Control on account of Disability or Executive’s death; or (iii) Executive voluntarily terminates employment with the Company on account of a resignation for Good Reason, Executive shall be entitled to the benefits provided in subsection (b) of this Section 3. For purposes of clarity, any termination of Executive’s employment on account of Disability or death that occurs prior to the date of a Change in Control shall not be covered by this Section 3.

 

(b)    Compensation on Account of Change in Control Termination. Subject to the provisions of Section 5 hereof, in the event a termination described in subsection (a) of this Section 3 occurs, the Company shall provide Executive (or his Beneficiary, in the event of Executive’s death) with the following, provided that Executive (or his Beneficiary, in the event of Executive’s death) executes and does not revoke the Release:

 

(i)    A lump sum cash payment equal to two and 99/100 (2.99) times the sum of Executive’s (A) Annual Base Salary and (B) Bonus, which lump sum cash payment shall be paid to Executive, subject to Section 17(b) of this Agreement, on the first regularly scheduled Company payroll date following the 55th day after Executive’s Termination Date.

 

(ii)    A lump sum cash payment equal to twenty-four (24) times the monthly COBRA premium cost, as in effect immediately prior to Executive’s Termination Date, for Executive to continue medical, dental, and vision coverage, as applicable, in the Company plans for himself and, if applicable, his spouse and eligible dependents, in which he (and his spouse and eligible dependents) was participating immediately prior to his Termination Date, which lump sum cash payment shall be paid to Executive, subject to Section 17(b) of this Agreement, on the first regularly scheduled Company payroll date following the 55th day after Executive’s Termination Date.

 

 

(iii)    In addition to the foregoing, Executive shall receive any other amounts earned, accrued or owing but not yet paid to Executive prior to his Termination Date, and any other benefits in accordance with the terms of any applicable plans and programs of the Company; provided that Executive shall not be entitled to receive severance benefits under any Company severance plan.

 

Notwithstanding anything herein to the contrary, in the event that Executive is entitled to the amounts set forth in Section 2 and, if in connection with such termination, Executive reasonably demonstrates that such termination would constitute a Termination Related to a Change in Control pursuant to Section 1(l)(i) of this Agreement if the Change in Control is consummated within the one hundred twenty (120) day period following Executive’s Termination Date, Executive shall initially receive the severance benefits described in Section 2(b) of this Agreement in the time and form described in such Section and if the Change in Control is consummated within such one hundred twenty (120) day period, upon the consummation of the Change in Control, Executive shall cease to receive the severance benefits set forth in Section 2(b), and instead shall receive the severance benefits described in this Section 3(b), reduced by the value of the severance benefits paid to Executive pursuant to Section 2(b) prior to the date of the Change in Control. The severance benefits payable to Executive pursuant to this paragraph shall be paid to Executive in a lump sum cash payment, subject to Section 17(b) of this Agreement, on the first regularly scheduled Company payroll date following the later of (i) the date of the Change in Control or (ii) the 55th day following Executive’s Termination Date. If Executive receives the severance benefits described in this paragraph, Executive will not be entitled to receive any further amounts payable pursuant to Section 2(b).

 

4.    Termination of Employment on Account of Disability, Death, Cause or Voluntarily Without Good Reason.

 

(a)    Termination on Account of Disability. In the event Executive’s employment terminates on account of Disability (other than as provided in Section 3(a)(ii) of this Agreement), Executive shall not receive benefits pursuant to Sections 2 or 3 hereof. However, Executive shall receive any amounts earned, accrued or owing but not yet paid to Executive prior to his Termination Date, and any benefits due Executive in accordance with the terms of any applicable benefit plans and programs of the Company.

 

(b)    Termination on Account of Death. In the event Executive’s employment terminates on account of death (other than as provided in Section 3(a)(ii) of this Agreement), neither Executive nor any beneficiary of Executive shall receive benefits pursuant to Sections 2 or 3 hereof. However, Executive shall receive any amounts earned, accrued or owing but not yet paid to Executive prior to his Termination Date, and any benefits due Executive in accordance with the terms of any applicable benefit plans and programs of the Company.

 

(c)    Termination on Account of Cause. In the event Executive’s employment terminates by the Company on account of Cause, Executive shall not receive benefits pursuant to Sections 2 or 3 hereof. However, Executive shall receive any amounts accrued or owing but not yet paid to Executive prior to his Termination Date, and any benefits due Executive in accordance with the terms of any applicable benefit plans and programs of the Company.

 

 

(d)    Termination on Account of Voluntary Resignation Without Good Reason. Notwithstanding anything in this Agreement to the contrary, if Executive’s employment terminates on account of a resignation by Executive for no reason or any reason other than on account of Good Reason, Executive shall not receive benefits pursuant to Sections 2 or 3 hereof. However, Executive shall receive any amounts earned, accrued or owing but not yet paid to Executive prior to his Termination Date, and any benefits due Executive in accordance with the terms of any applicable benefit plans and programs of the Company.

 

5.    Release. Notwithstanding the foregoing, no payments under this Agreement shall be made unless Executive executes (or, in the event of Executive’s death and an amount is payable to Executive’s Beneficiary pursuant to Section 3(a)(ii), Executive’s Beneficiary), and does not revoke, a written release of claims (the “Release”), in substantially the form as the document attached as Exhibit A hereto (with such modifications reasonably determined by the Company if the Release is to be executed by Executive’s Beneficiary because of Executive’s death).

 

6.    Application of 280G.

 

(a)    Effect of Section 280G on Payments. In the event a Change in Control occurs and Executive becomes entitled to any benefits or payments in the nature of compensation (within the meaning of section 280G(b)(2) of the Code) under this Agreement, or any other plan, arrangement, or agreement with the Company (the “Payments”), and such benefits or payments will be subject to the tax (the “Excise Tax”) imposed by section 4999 of the Code (or any similar tax that may hereafter be imposed), the aggregate present value of the Payments under this Agreement, and such other plan, arrangement or agreement with the Company, shall be reduced (but not below zero) to the Reduced Amount (as defined below), if reducing such Payments will provide Executive with a greater net after-tax amount than would be the case if no reduction was made. The “Reduced Amount” shall be an amount expressed in present value which maximizes the aggregate present value of Payments without causing any Payment to be subject to the Excise Tax, determined in accordance with section 280G(d)(4) of the Code. The Company shall reduce the Payments by first reducing Payments that are not payable in cash and then by reducing cash Payments, with such reduction being done in a manner consistent with the requirements of section 409A of the Code.

 

(b)    Computation. In determining the potential impact of the Excise Tax, the Company may rely on any advice it deems appropriate, including, but not limited to, the counsel of its independent accounting firm. For purposes of determining whether any of the Payments will be subject to the Excise Tax and the amount of such Excise Tax, the Company may take into account any relevant guidance under the Code and the regulations promulgated thereunder.

 

7.    Restrictive Covenants. For purposes of this Section 7, the term “Company” shall include the Company and any subsidiary or affiliate of the Company.

 

 

(a)    Non-Disclosure. Except as provided in Section 7(c), at all times during Executive’s employment with the Company and continuing at all times after Executive’s termination of employment for any reason or no reason, and except as required by applicable law or in a judicial or administrative proceeding, Executive shall not disclose to anyone outside the Company, or use for the benefit of anyone other than the Company, any confidential or proprietary information relating to the business of the Company, whether acquired by Executive before, during or after employment with the Company. Executive acknowledges that the proprietary and confidential information of the Company includes, by way of example: (a) the identity of customers and prospects, their specific requirements, and the names, addresses and telephone numbers of individual contacts; (b) prices, renewal dates and other detailed terms of customer and supplier contracts and proposals; (c) pricing policies, information about costs, profits and sales, and marketing and sales strategies; (d) employment and payroll records; (e) forecasts, budgets, acquisition models and other non public financial information; (f) expansion plans, business or development plans, management policies, information about possible acquisitions or divestitures, potential new products, markets or market extensions, and other business and acquisition strategies and policies; and (g) terms of employment, compensation and performance levels of Company employees. Proprietary and confidential information shall not include any information that is generally known to the industry or the public other than as a result of Executive’s breach of this Section 7.

 

(b)    Non-Competition and Non-Solicitation.

 

(i)    During Executive’s employment with the Company and for a one (1) year period after Executive’s termination of employment with the Company for any reason or no reason, whether or not payments are being made under this Agreement, Executive shall not, directly or indirectly, (x) render any services for any organization, or engage in any business, that directly competes in any respect with the business of the Company in North America or Central America (a “Competing Business”), or (y) solicit or contact, for the purpose or with the effect of competing or interfering with the business of the Company (i) any customer or acquisition target under contract with the Company at any time during Executive’s employment with the Company, (ii) any prospective customer or acquisition target that received or requested a proposal, offer or letter of intent from the Company at any time during Executive’s employment with the Company, (iii) any affiliate of any such customer or prospect, or (iv) any of the individual contacts at customers or acquisition targets established by the Company, Executive or others at the Company during the period of Executive’s employment with the Company.

 

(ii)    During Executive’s employment with the Company and for a period of one (1) year after Executive’s termination of employment with the Company for any reason or no reason, whether or not payments are being made under this Agreement, Executive shall not directly or indirectly hire, or encourage or solicit any employee, consultant or independent contractor to leave the employment or service of the Company for any reason or interfere in any other manner with such relationships.

 

 

(c)    Permitted Conduct. Nothing in this Agreement shall prohibit or restrict Executive from initiating communications directly with, responding to any inquiries from, providing testimony before, providing confidential information to, reporting possible violations of law or regulation to, or from filing a claim or assisting with an investigation directly with a self-regulatory authority, law enforcement agency, or a government agency or entity, including the Securities and Exchange Commission, the Equal Employment Opportunity Commission, the Department of Labor, the National Labor Relations Board, the Department of Justice, Congress, and any agency Inspector General, or from making other disclosures that are protected under the whistleblower provisions of applicable law or regulation. Executive does not need the prior authorization of the Company to engage in the activities described in this Section 7(c). Executive is not required to notify the Company that Executive has engaged in the activities described in this Section 7(c). In addition, please take notice that federal law provides criminal and civil immunity to federal and state claims for trade secret misappropriation to individuals who disclose a trade secret to their attorney, a court, or a government official in certain, confidential circumstances that are set forth at 18 U.S.C. §§ 1833(b)(1) and 1833(b)(2), related to the reporting or investigation of a suspected violation of the law, or in connection with a lawsuit for retaliation for reporting a suspected violation of the law.

 

8.    Equitable Relief; Survival.

 

(a)    Executive acknowledges and agrees that the restrictions contained in Section 7 are reasonable and necessary to protect and preserve the legitimate interests, properties, goodwill and business of the Company, the Company would not have entered into this Agreement in the absence of such restrictions and that irreparable injury will be suffered by the Company should Executive breach any of the provisions of that Section. Executive represents and acknowledges that (i) Executive has been advised by the Company to consult Executive’s own legal counsel with respect to this Agreement, and (ii) Executive has had full opportunity, prior to execution of this Agreement, to review thoroughly this Agreement with Executive’s counsel.

 

(b)    Executive further acknowledges and agrees that a breach of any of the restrictions in Section 7 cannot be adequately compensated by monetary damages. Executive agrees that the Company shall be entitled to preliminary and permanent injunctive relief, without the necessity of proving actual damages or posting of any bond, as well as an equitable accounting of all earnings, profits and other benefits arising from any violation of Section 7 hereof, which rights shall be cumulative and in addition to any other rights or remedies to which the Company may be entitled. In the event that any of the provisions of Section 7 should ever be adjudicated to exceed the time, geographic, service, or other limitations permitted by applicable law in any jurisdiction, it is the intention of the parties that the provision shall be amended to the extent of the maximum time, geographic, service, or other limitations permitted by applicable law, that such amendment shall apply only within the jurisdiction of the court that made such adjudication and that the provision otherwise be enforced to the maximum extent permitted by law.

 

(c)    Notwithstanding anything in this Agreement to the contrary, if Executive breaches any of Executive’s obligations under Section 7, the Company shall thereafter be obligated only for the compensation and other benefits provided in any Company benefit plans, policies or practices then applicable to Executive in accordance with the terms thereof, Executive shall have no right to receive any payments under Sections 2 or 3 of this Agreement, and all payments under Sections 2 or 3 of this Agreement shall immediately cease.

 

(d)    Executive irrevocably and unconditionally (i) agrees that any suit, action or other legal proceeding arising out of Section 7, including without limitation, any action commenced by the Company for preliminary and permanent injunctive relief and other equitable relief, may be brought in a United States District Court for New Jersey, or if such court does not have jurisdiction or will not accept jurisdiction, in any court of general jurisdiction in Camden County, New Jersey, (ii) consents to the non-exclusive jurisdiction of any such court in any such suit, action or proceeding, and (iii) waives any objection which Executive may have to the laying of venue of any such suit, action or proceeding in any such court. Executive also irrevocably and unconditionally consents to the service of any process, pleadings, notices or other papers in a manner permitted by the notice provisions of Section 16 hereof.

 

 

(e)    The provisions of Sections 7, 8 and 9 of this Agreement shall survive any termination or expiration of this Agreement and shall inure to the benefit of any successors or assigns of the Company.

 

9.    Invention Assignment. Executive agrees that all inventions, innovations, improvements, developments, methods, designs, analyses, reports, and all similar or related information which relates to the Company’s actual or anticipated business, research and development or existing or future products or services and which are conceived, developed or made by Executive while employed by the Company ( “Work Product”) belong to the Company. Executive will promptly disclose such Work Product to the Board and perform all actions reasonably requested by the Board (whether while employed or after termination of employment) to establish and confirm such ownership (including, without limitation, assignments, consents, powers of attorneys and other instruments).

 

10.    Dispute Resolution. In the event of any dispute relating to this Agreement, other than a dispute in which the primary relief sought is an equitable remedy such as an injunction, and unless prohibited by applicable law, the parties shall be required to have the dispute, controversy or claim settled by alternative dispute resolution conducted by JAMS (or, if JAMS is not available, another mutually agreeable alternative dispute resolution organization), in the city of Executive’s principal place of employment. Any award entered by JAMS (or such other organization) shall be final, binding and nonappealable, and judgment may be entered thereon by either party in accordance with applicable law in any court of competent jurisdiction. This Section 10 shall be specifically enforceable. JAMS (or such other organization) shall have no authority to modify any provision of this Agreement. In the event of a dispute, each party shall be responsible for its own expenses (including attorneys’ fees) relating to the conduct of the arbitration; provided, however, that if Executive prevails on a material (outcome determinative) issue before JAMS, as determined by JAMS, then the Company will reimburse Executive for his reasonable attorneys’ fees in connection with such dispute. The fees of JAMS (or such other organization) shall be paid by the Company. THE PARTIES IRREVOCABLY WAIVE ANY RIGHT TO TRIAL BY JURY AS TO ALL CLAIMS RELATING TO THIS AGREEMENT.

 

11.    Employment Rights. Nothing expressed or implied in this Agreement will create any right or duty on the part of the Company or Executive to have Executive remain in the employment of the Company or any subsidiary prior to or following any Change in Control.

 

12.    Withholding of Taxes. All amounts payable under this Agreement to Executive are subject to applicable tax withholding requirements and the Company may withhold from any amounts payable under this Agreement all federal, state, city or other taxes as the Company is required to withhold pursuant to any applicable law, regulation or ruling.

 

 

13.    Term of Agreement. This Agreement shall continue in full force and effect for the duration of Executive’s employment with the Company, unless terminated at any earlier time by mutual agreement between Executive and the Company; provided, however, that after the termination of Executive’s employment during the term of this Agreement, this Agreement shall remain in effect until all of the obligations of the parties hereunder are satisfied or have expired.

 

14.    Successors and Binding Agreement.

 

(a)    The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) to all or substantially all of the business or assets of the Company, by agreement in form and substance reasonably satisfactory to Executive, expressly to assume and agree to perform this Agreement in the same manner and to the same extent the Company would be required to perform if no such succession had taken place. This Agreement will be binding upon and inure to the benefit of the Company and any successor to the Company, including without limitation any persons acquiring directly or indirectly all or substantially all of the business or assets of the Company whether by purchase, merger, consolidation, reorganization or otherwise (and such successor will thereafter be deemed the “Company” for the purposes of this Agreement), but will not otherwise be assignable, transferable or delegable by the Company.

 

(b)    This Agreement will inure to the benefit of and be enforceable by Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees and legatees. This Agreement will supersede the provisions of any employment, severance or other agreement between Executive and the Company that relate to any matter that is also the subject of this Agreement, and such provisions in such other agreements will be null and void.

 

(c)    This Agreement is personal in nature and neither of the parties hereto will, without the consent of the other, assign, transfer or delegate this Agreement or any rights or obligations hereunder except as expressly provided in Sections 14(a) and 14(b). Without limiting the generality or effect of the foregoing, Executive’s right to receive payments hereunder will not be assignable, transferable or delegable, whether by pledge, creation of a security interest, or otherwise, other than by a transfer by Executive’s will or by the laws of descent and distribution and, in the event of any attempted assignment or transfer contrary to this Section 14(c), the Company will have no liability to pay any amount so attempted to be assigned, transferred or delegated.

 

15.    Entire Agreement. This Agreement sets forth the entire agreement of the parties hereto and supersedes any and all prior agreements and understandings concerning Executive’s entitlement to severance benefits from the Company in the event of Executive’s termination of employment with the Company and Executive’s entitlement to a change in control payment in the event Executive remains continuously employed following the date of a Change in Control, including, without limitation, the Prior Agreement. During the term of this Agreement, Executive shall not be eligible for severance under any Company severance plan.

 

 

16.    Notices. For all purposes of this Agreement, all communications, including without limitation notices, consents, requests or approvals, required or permitted to be given hereunder will be in writing and will be deemed to have been duly given when hand delivered or dispatched by electronic facsimile transmission (with receipt thereof orally confirmed), or five (5) business days after having been mailed by United States registered or certified mail, return receipt requested, postage prepaid, or three (3) business days after having been sent by a nationally recognized overnight courier service such as FedEx or UPS, addressed to the Company (to the attention of the Secretary of the Company) at its principal executive office and to Executive at his principal residence, or to such other address as any party may have furnished to the other in writing and in accordance herewith, except that notices of changes of address will be effective only upon receipt.

 

17.    Section 409A of the Code.

 

(a)    Interpretation. Notwithstanding the other provisions hereof, this Agreement is intended to comply with the requirements of section 409A of the Code, to the extent applicable, and this Agreement shall be interpreted to avoid any penalty sanctions under section 409A of the Code. Accordingly, all provisions herein, or incorporated by reference, shall be construed and interpreted to comply with section 409A of the Code and, if necessary, any such provision shall be deemed amended to comply with section 409A of the Code and regulations thereunder. If any payment or benefit cannot be provided or made at the time specified herein without incurring sanctions under section 409A of the Code, then such benefit or payment shall be provided in full at the earliest time thereafter when such sanctions will not be imposed. All payments to be made upon a termination of employment under this Agreement that are deferred compensation may only be made upon a “separation from service” under section 409A of the Code. For purposes of section 409A of the Code, each payment made under this Agreement shall be treated as a separate payment. In no event may Executive, directly or indirectly, designate the calendar year of payment. No action or failure to act pursuant to this Section 17(a) shall subject the Company nor any affiliate thereof to any claim, liability or expense, and none of the Company nor any affiliate thereof shall have any obligation to indemnify or otherwise protect Executive from the obligation to pay any taxes pursuant to section 409A of the Code.

 

(b)    Payment Delay. If at the time of Executive’s separation from service, the Company’s (or any entity required to be aggregated with the Company under section 409A of the Code) stock is publicly-traded on an established securities market or otherwise and Executive is a “specified employee” (as defined in section 409A of the Code and determined in the sole discretion of the Company (or any successor thereto) in accordance with the Company’s (or any successor thereto) “specified employee” determination policy), then the Company shall postpone the commencement of the payment of the portion of such severance that constitutes deferred compensation subject to section 409A of the Code which is payable within the six (6) month period following Executive’s Termination Date with the Company (or any successor thereto) for six (6) months following Executive’s Termination Date with the Company (or any successor thereto). The delayed amount shall be paid in a lump sum to Executive within ten (10) days following the date that is six (6) months following Executive’s Termination Date with the Company (or any successor thereto). If Executive dies during such six (6) month period and prior to the payment of the amount that is required to be delayed on account of section 409A of the Code, such amount shall be paid to the personal representative of Executive’s estate within sixty (60) days after Executive’s death.

 

 

18.    Rabbi Trust. If a Change in Control occurs while this Agreement is in effect, the Company shall establish, effective as of the date of the Change in Control, a rabbi trust based on the Internal Revenue Service (“IRS”) model rabbi trust as provided in IRS Revenue Procedure 92-64 (the “Rabbi Trust”), and the Company shall contribute, effective as of the date of the Change in Control, to such Rabbi Trust an amount equal to the greater of (i) the sum of the cash amount payable pursuant to (A) Section 3(b)(i) and (B) Section 3(b)(ii) of the Agreement or (ii) the Change in Control Payment. If amounts become payable under the Agreement following the date of the Change in Control, such amounts shall be paid from the Rabbi Trust to Executive at the time(s) and in the form(s) provided under the Agreement and subject to the terms and conditions of the Agreement. The Company shall be solely responsible for all fees related to the implementation, maintenance and/or termination of the Rabbi Trust.

 

19.    Governing Law. The validity, interpretation, construction and performance of this Agreement will be governed by and construed in accordance with the substantive laws of the State of New Jersey, without giving effect to the principles of conflict of laws of such State.

 

20.    Validity. If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any other person or circumstances will not be affected, and the provision so held to be invalid, unenforceable or otherwise illegal will be reformed to the extent (and only to the extent) necessary to make it enforceable, valid or legal.

 

21.    Miscellaneous. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing signed by Executive and the Company. No waiver by either party hereto at any time of any breach by the other party hereto or compliance with any condition or provision of this Agreement to be performed by such other party will be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, expressed or implied with respect to the subject matter hereof have been made by either party that are not set forth expressly in this Agreement. References to Sections are to references to Sections of this Agreement. Any reference in this Agreement to a provision of a statute, rule or regulation will also include any successor provision thereto.

 

22.    Survival. The respective rights and obligations of the parties under this Agreement (including without limitation Sections 6, 7, 8 and 9) shall survive any termination of Executive’s employment or termination of this Agreement to the extent necessary to the intended preservation of such rights and obligations.

 

23.    Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original but all of which together will constitute one and the same agreement.

 

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered as of the date first above written.

 

RCM TECHNOLOGIES, INC.

 

 

 

 

By:         /s/ Kevin D. Miller

Name:  Kevin D. Miller

Title: CFO

 

BRADLEY S. VIZI

 

 

/s/ Bradley S. Vizi

 

 

Exhibit A

 

Release and Separation Agreement

 

This Release Agreement (“Release”) is by and between Bradley S. Vizi (“Executive”) and RCM Technologies, Inc. (the “Company”) and shall be effective as of the date on which Executive executes this Release as set forth below.

 

WHEREAS, Executive’s employment has been terminated on account of _________, pursuant to the Executive Severance Agreement between Executive and the Company, dated as of ______ ___, 20__ (“Severance Agreement”); and

 

WHEREAS, Executive is entitled to certain payments and benefits under the Severance Agreement subject to his execution and delivery of this Release to the Company.

 

NOW, THEREFORE, intending to be legally bound, the parties agree as follows:

 

1.         Release of Claims. In consideration for the severance payments by the Company as set forth in Section [2(b)] or [3(b)] of the Severance Agreement and other good and valuable consideration set forth herein, Executive hereby releases the Company, its shareholders, directors, officers, employees, agents, benefit plans, attorneys, affiliates, parents, subsidiaries, predecessors, successors, assigns, and all persons acting by, through, under or in concert with any of them (but with respect to any entity, individual, agent, attorney or their affiliates, including any one acting by, through, under or in concert with any of them, only in its or his official capacity relating to the Company and not in its or his individual capacity unrelated to the Company) (collectively, “Released Parties”), from any and all rights and claims, known or unknown, that he may have now or in the future may arise based on, arising out of or relating to his employment with the Company or the termination thereof for any and all reasons. Said release includes but is not limited to, any rights or claims which Executive may have against any of the Released Parties based upon Title VII of the Civil Rights Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Equal Pay Act, the Employee Retirement Income Security Act (save for claims for vested pension benefits which are expressly exempted from this Release), the New Jersey Law Against Discrimination, the New Jersey Conscientious Employee Protection Act, the Pennsylvania Human Relations Act, and any other federal, state or local law or regulation which prohibits employment discrimination or which otherwise regulates employment terms and conditions. Executive also releases each of the Released Parties from any claim for wrongful discharge, unfair treatment, breach of public policy, breach of express or implied contract, breach of covenant of good faith and fair dealing, intentional or negligent infliction of emotional distress, negligence, misrepresentation, fraud, detrimental reliance, promissory estoppel, defamation, invasion of privacy, sexual harassment, breach of laws governing safety in the workplace, or any other claims arising under common law that relate in any way to Executive’s employment or the termination thereof. This Release covers claims that Executive knows about and those that he may not know about up through the date of this Release. This Release specifically includes any and all claims for attorneys’ fees and costs which Executive incurred or incurs for any reason arising out of or relating to any or all matters covered by this Release. Notwithstanding the foregoing, Executive is not releasing any claims hereunder with respect to (a) Executive’s right to be indemnified and/or advanced or reimbursed expenses pursuant to any corporate document of the Company, applicable law, or Executive’s right to be covered under any applicable directors’ and officers’ liability insurance policies, (b) any rights that Executive has with respect to any equity awards that have vested as of the Termination Date, (c) any rights as a shareholder of the Company, or (d) any rights which arise after the date of this Release with respect to matters that occurred after such date. Executive also is not releasing any claims that are not waivable by law.

 

 

2.         No Litigation of Claims. Except as provided in Section 4, Executive acknowledges that he has not caused or permitted any complaint, lawsuit or any other action or proceeding whatsoever to be filed against the Company or any of the other Released Parties in connection with his employment or the separation of that employment to date and that he may not file or be a party to any lawsuit asserting claims or causes of action waived and released by him pursuant to this Release.

 

3.         No Right to Re-employment. Executive hereby agrees and recognizes that his employment relationship with the Company or its affiliates is being permanently and irrevocably severed and that the Company has no obligation, contractual or otherwise, to rehire, re-employ, recall or to hire him in the future, or return him to active status.

 

4.         Permitted Conduct. Nothing in this Agreement shall prohibit or restrict Executive from initiating communications directly with, responding to any inquiries from, providing testimony before, providing confidential information to, reporting possible violations of law or regulation to, or from filing a claim directly with or assisting with an investigation by a self-regulatory authority, law enforcement agency, or a government agency or entity, including the Securities and Exchange Commission, the Equal Employment Opportunity Commission, the Department of Labor, the National Labor Relations Board, the Department of Justice, Congress, and any agency Inspector General (collectively, the “Regulators”), or from making other disclosures that are protected under the whistleblower provisions of applicable law. or regulation. Executive does not need the prior authorization of the Company to engage in the activities described in this Section 4. Executive is not required to notify the Company that Executive has engaged in the activities described in this Section 4. This Agreement does not limit Executive’s right to receive an award from any Regulator that provides awards for providing information relating to a potential violation of law.

 

Additionally, pursuant to the federal Defend Trade Secrets Act of 2016, Executive shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (a) is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made to Executive’s attorney in relation to a lawsuit for retaliation against Executive for reporting a suspected violation of law; or (c) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Nor does this Agreement require Executive to obtain prior authorization from the Company before engaging in any conduct described in this paragraph, or to notify the Company that Executive has engaged in any such conduct.

 

 

5.         Tax Withholdings. All amounts payable pursuant to this Release are subject to applicable tax withholdings. In addition, Executive is solely responsible for all taxes that may result from his receipt of the amounts payable and benefits to be provided to him under this Release, and neither the Company nor any of its affiliates makes or has made any representation, warranty or guarantee of any federal, state or local tax consequences to Executive of his receipt of any payment or benefit hereunder, including, but not limited to, under Section 409A of the Internal Revenue Code of 1986, as amended.

 

6.         Restrictive Covenants. Reference is hereby made to Section 7 of the Severance Agreement which provides that Executive’s restriction period is one (1) year following Executive’s Termination Date. Executive understands and acknowledges that Executive is obligated to continue to comply with Executive’s covenants and agreements set forth in Section 7 of the Severance Agreement, including those covenants of Executive contained therein relating to confidentiality, non-competition and non-solicitation, in accordance with the terms of those covenants and agreements.

 

7.         Attorney Consultation Advised. The Company hereby advises Executive to consult with any attorney of his choosing prior to signing this Release. By signing below, Executive acknowledges and agrees that he has been encouraged to do so by the Company and that it is entirely his decision whether or not to consult with counsel. Executive is signing this Agreement voluntarily without duress or coercion to release Executive’s claims against the Company in exchange for consideration that is greater than he would otherwise have received.

 

8.         Review Period. Executive shall have a period of not less than twenty-one (21) calendar days from the effective date of his termination to consider this Release before signing and returning it to the Company. It is exclusively Executive’s decision whether to use all or part of this 21-day period. To the extent Executive elects to execute this Release sooner than the conclusion of the 21-day period, Executive acknowledges and agrees that it has been exclusively his decision as to when to sign and return this Release to the Company. Upon execution, this Release should be returned to the Company in accordance with the Notice provisions of the Severance Agreement.

 

9.         Revocation Period. Executive shall have a period of seven (7) calendar days after signing this Release and returning it to the Company in which he may revoke this Release should he change his mind. In order for this revocation to be effective, it must be given in accordance with the Notice provisions of the Severance Agreement and received by the Company no later than the close of business on the 7th day after Executive’s employment has terminated.

 

10.         Effective Date of Release. This Release shall not become effective until the eighth (8th) day after Executive’s execution of this Release provided that the Release is not revoked during the revocation period set forth in Section 9 of this Release. Accordingly, severance payments described in Section [2(b)] or [3(b)] of the Severance Agreement shall not commence until such time.

 

 

11.         No Admission of Liability. By entering into this Release, the Company does not admit and expressly denies that it has violated any contract, rule, law or regulation, including, but not limited to, any federal, state or local law or regulation relating to employment, employment discrimination or retaliation.

 

12.         Enforceability of Agreement. Executive acknowledges that this Agreement is contractual and not a mere recital. He agrees that this Agreement shall be given full force and effect and that it shall be binding upon Executive’s heirs, executors, successors, administrators and assigns. The invalidity or unenforceability of any provision of this Release, whether in whole or in part, shall not in any way affect the validity or enforceability of any other provision contained herein.

 

13.         Applicable Law. This Release shall be construed and enforced under and in accordance with the laws of the State of New Jersey.

 

Executive represents and certifies that he has carefully read and fully understands all of the provisions of this Release and that he is signing this Release voluntarily, of his own free will and without duress; and that the Company, its agents, representatives or attorneys have made no representations concerning the terms or effects of this Release other than contained herein.

 

14.         Medicare Representation. By signing this Agreement, Executive represents and warrants that he is not a Medicare beneficiary as of the date that he signs this Agreement.

 

 

 

[SIGNATURE PAGE FOLLOWS]

 

 

IN WITNESS THEREOF, Executive has duly executed this Release agreement on this day of _________, 20___.

 

 

 

_________________________________                  __________________________

Bradley S. Vizi                                                           Date

 

 

For RCM Technologies, Inc.         
 

 

________________________________                  _________________________

Date                                    

 

Exhibit 19

 

 

 

POLICY STATEMENT

 

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Insider Trading

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Introduction   While performing their duties, directors, officers and employees of RCM Technologies, Inc. and its subsidiaries (collectively, “RCM” or the “Company”) may learn material, nonpublic information about RCM or another company. This information may be valuable to those who trade in RCM’s stock or the stock of other companies. It is the law, as well as in the interest of the Company, that this information not be disclosed to anyone outside RCM and that no one profit as a result of having information not available to the general public.   This Policy Statement states RCM’s policy regarding insider trading, provides procedures to limit the release of such information and gives guidance to directors, officers and employees of RCM regarding their individual obligations regarding insider trading.

RCM is committed to protecting its confidential information. The ethical and business principles that are the foundation of this Policy Statement may be broader than the stringent requirements of federal securities laws. However, the confidence and trust placed in all of us by the Company and its stockholders are of great value and should be preserved and protected. The reputation of RCM and each employee for integrity and professionalism are important Company and personal assets.   This policy regarding insider trading is not designed or intended to discourage RCM personnel from investing in RCM securities; indeed, we encourage investment in our stock by our employees. The Policy Statement creates a program and procedures to protect our employees and the Company from inadvertent violations of the policy and the laws against insider trading.

 

The Policy   A director, officer or employee of RCM who is in possession of or who has knowledge of material, non-public information regarding or relating to RCM or any other company may not
●	buy or sell securities of RCM or that company, based on the use of the material nonpublic information

●	communicate that information to others, or

●	in any other way, take advantage of that information.

 

 

Scope of the Policy   The Policy Statement is drafted broadly; it will be applied and interpreted in a similar manner. The Policy Statement applies to all directors, officers and employees of RCM and the immediate families and personal households of such directors, officers and employees.   Legal Considerations Relating To Material, Nonpublic Information   Insider trading is a serious legal concern for both employees and the Company. The law provides for significant civil and criminal penalties for insider trading violations.   Some of those penalties are imposed upon individuals who use material, nonpublic information for their own gain. Civil and criminal liability could also extend to an employee who “tips” another person about material, non-public information where that person, in turn, buys or sells stock.   There is a wide range of potential sanctions for a person found to have engaged in insider trading. Besides requiring disgorgement of profits gained or losses avoided, the Securities and Exchange Commission (the “SEC”) may seek to impose a penalty of up to three times the illicit windfall. In addition, the government may seek a criminal fine of up to $1,000,000 and/or ten years imprisonment. By passing laws with strong criminal penalties, Congress has expressed its intent that each person convicted of insider trading serve a jail term.   Federal securities law also creates a strong incentive for the Company to deter insider trading by its employees. Employers now may be held liable if they know of or recklessly disregard employee conduct leading to an insider trader violation. Companies may face treble civil damages and criminal fines totaling up to $2,500,000 imposed by the SEC. In addition, private litigants may also be able to make significant claims against the Company.

The penalties for employers and employees are different, however, and there may be situations in which the concerns of the Company and an employee accused of insider trading diverge. This contrasts with most litigation, in which an employer typically reinforces and supports the actions of its directors, officers and employees. Consequently, an employee who trades on material, nonpublic information should not expect the Company to protect his or her interests.   Some Guidelines   After reading this Policy Statement, you may have already become more aware of situations in which you may possess information that may be considered material, non-public information. Consider these general rules when you are presented with a situation that may concern you.   You Should Presume Information Is “Material.” Information should be considered material if it would be considered important by investors making decisions whether to purchase, sell or hold the securities of the company in question. Stated another way, information should be considered material if it would alter the total mix of information available to the public. Either positive or negative information may be material.

 

 

Examples of material information include: ●    earnings or revenue results ●    a merger or acquisition proposal ●    new business ventures, partnerships or agreements, or a change in existing ventures, partnerships or agreements ●    new product developments ●    new business information relating to changes in management, operations or financial condition, such as impending bankruptcy or financial problems of a customer, and ●    the gain or loss of a substantial customer or supplier.   You Should Presume Information Is “Nonpublic.” Information should be treated as being nonpublic unless a reasonable period of time has passed, usually two business days, since it has been distributed by means likely to result in a general public awareness of the information, for example, by publication of the information in a daily newspaper.   Trading By Directors, Officers and Other Employees   At the end of every quarter, RCM will announce financial information about the Company’s performance. That information may be better, or worse, than people who trade in the Company’s stock expect. Due to the potential impact of the release of financial information at the end of each quarter on the price of the Company’s stock, it is important to avoid any appearance of impropriety which might result if employees of the Company trade RCM stock near the end of a quarter. Therefore, the Company has instituted what it refers to as the “Black-Out Period” for directors, officers and others who may have access to this information in the course of their duties. Please see the attached discussion of Black-Out Periods and Trading Windows to determine if you are subject to these trading restrictions.

Short‑Term Trading, Options and Certain Other Transactions   RCM strongly discourages directors, officers and employees from engaging in the following four activities with respect to the securities of RCM:   1. Trading in securities on a short‑term basis. Any RCM stock purchased in the open market should be held for a minimum of six (6) months and ideally longer. Directors and officers of RCM are subject to “short‑swing profit recovery” for any profit realized on the purchase and sale or sale and purchase of RCM securities within any six-month period.   2. Purchases of Company stock on margin.   3. Short sales and sales against the box.   4. Trading in puts, calls and straddles on RCM stock.

 

 

Compliance and Sanctions   RCM directors, officers and employees are personally responsible for ensuring that they and members of their immediate families and personal households comply with the provisions and intent of this Policy Statement. Violations of this Policy Statement will be viewed seriously. Such violations provide grounds for disciplinary action, including dismissal.

Summary   RCM has set forth a broad policy designed to limit the possibility of insider trading. However, insider trading is a complex area of the law and there are many circumstances in which an individual may be legitimately unsure about the application of this Policy Statement. In these situations, a simple question may forestall disciplinary action or complex legal problems. Please do not hesitate to direct any questions to the Chief Financial Officer, or, in his absence, to the Company’s General Counsel.

 

 

 

 

 

On the last page is an Acknowledgment and Disclosure Form certifying that you have read this Policy Statement. After you have read this document, please sign the Acknowledgment and Disclosure Form where indicated and return it to the Chief Financial Officer. Thank you for your cooperation.

 

 

RCM Technologies, Inc.

 

Black-Out Periods and Trading Windows

for Directors, Officers and Designated Employees

 

 

Purpose of Black-Out Periods and Trading Windows

 

As part of RCM’s Policy Statement on Insider Trading, the Company has established Black-Out Periods and Trading Windows for trading in RCM stock for certain individuals.

 

Persons Subject to Black-Out Periods and Trading Windows

 

Effective as of August 1, 2003, the following classes of persons are subject to Black-Out Periods and Trading Windows:

 

Class of Persons	Includes:
●         Directors of RCM	●         The RCM Board of Directors
●         Officers of RCM	●         All persons with, or ranking senior to, the title of Vice President at RCM.
●         Designated Employees: other employees with access to material non-public information during the ordinary course of their duties	●         Employees in the Finance and Accounting Departments. Administrative-Assistants reporting to Officers and or Directors.

 

If you have any questions about whether you are subject to Black-Out Periods and Trading Windows, please contact the Chief Financial Officer.

 

Black-Out Periods

 

The standard Black-Out Period will commence at 12:00 a.m., Eastern time, on the fifteenth (15th) day of the last month of each quarter (March 15, June 15, September 15 and December 15) and will end at 11:59 p.m., Eastern time, on the second (2nd) trading day after the public announcement of the Company’s earnings for the quarter. During the Black-Out Period, all Directors, Officers and Designated Employees are expected to refrain from buying or selling the Company’s securities.

 

The foregoing prohibition does not include:

 

●	The cash exercise of stock options granted under the Company’s stock plans. (Note, however, that a same day “cashless exercise” of stock options through a broker is considered a sale of securities for this purpose and is prohibited.)

 

 

●	purchases of stock under the Employee Stock Purchase Plan.

 

●	bona fide gifts of securities or certain other transfers of securities that are not considered a sale, such as a transfer to a family member or into a family trust.

 

Trading Windows

 

When a Black-Out Period is not in effect, a “Trading Window” is open and Directors, Officers, and Designated Employees may buy or sell RCM securities.

 

The Trading Window is
●	open at 12:00 a.m., Eastern time, on the third (3rd) trading day after the public announcement of the Company’s earnings and remains open through 11:59 p.m., Eastern time, on the fourteenth (14th) day of the last month of each quarter (March 14, June 14, September 14 and December 14), and

●	open for a period of five (5) business days beginning on the first business day following the effective date of a Registration Statement of RCM securities during any Black-Out Period.

 

 

Below is a table which shows the Black-Out Periods and Trading Windows applicable during a typical year. Please note that the dates set forth in the table with an “*” are approximations only. The Trading Windows could open earlier or later depending upon the public release of the Company’s earnings.

 

	Black-Out Period
	Trading Window

 

1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

Jan

Feb

Mar

April

May

June

July

Aug

Sept

Oct

Nov

Dec

 

Open: Feb 1* – March 14 Closed: Mar 15 – Apr 30*

Open: May 1* – June 14    Closed: June 15 – July 31*

Open: Aug 1* – Sept. 14 Closed: Sept 15 – Oct 31*

Open: Nov 1* – Dec 14 Closed: Dec 15 – Jan 31*

                        

 

Additional Black-Out Periods; Early Closing of Trading Windows

 

Additional Black-Out Periods may be imposed during the course of an otherwise open Trading Window and existing Black-Out Periods may be extended. Usually this will occur when the Company is imminently considering some significant decision, for example, a public offering of securities, an acquisition, or a major commercial transaction. At those times, you will receive a separate communication from the Chief Executive Officer or the Chief Financial Officer advising of the commencement of a special Black-Out Period or an extension of a regular Black-Out Period. We will attempt to give you as much advance notice as possible of additional Black-Out Periods, but given the nature of the transaction involved, you may receive very short notice.

 

 

Special Circumstances During Black-Out Periods

 

The Chief Financial Officer , after conferring with the Chief Executive Officer, may, but will not be obligated to, approve trades of the Company during a Black-Out Period, provided that (1) the individual proposing to engage in such a trade provides a valid reason to justify the trade, such as hardship or a desire to purchase stock to demonstrate support for the Company; (2) the individual provides the amount and terms of any proposed transactions prior to the commencement of the Black-Out Period; and (3) the individual proposing to trade has certified prior to the proposed trade date that such individual is not in possession of material non-public information concerning the Company.

 

Pre-Clearance of Trades by Directors and Executive Officers

 

To further insure compliance with securities laws and to be certain insider sales do not create any adverse impression in the market, all trades by executive officers or directors should be pre-cleared in advance by the Chief Executive Officer or the Chief Financial Officer.

 

 

RCM TECHNOLOGIES, INC.

 

POLICY STATEMENT

 

INSIDER TRADING

 

Acknowledgment and Disclosure Form

 

 

Please review, date, sign and return this form to the Human Resources Director.

 

 

1.	I have received a copy of the POLICY STATEMENT – INSIDER TRADING.

 

2.	I have read and understand the POLICY STATEMENT – INSIDER TRADING and agree to comply with its terms.

 

3.	I understand that a violation of the POLICY STATEMENT – INSIDER TRADING may be considered grounds for termination of my employment or other disciplinary action by RCM Technologies, Inc. and may lead to civil or criminal liability.

 

 

 

Date: _______________________
	(Signature)
	(Name - please print)

                   

 

 

EXHIBIT 21

 

 

SUBSIDIARIES OF THE REGISTRANT

 

Cataract, Inc.

RCM Technologies Engineering d.o.o. Beograd

RCM Technologies Canada Corp.

RCM Technologies GmbH

RCM Technologies (USA), Inc.

RCM Technologies Netherlands B.V.

RCMT Delaware, Inc.

RCMT Europe Holdings, Inc.

RCMTPH Inc.

 

EXHIBIT 23.1

 

 

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

We consent to the incorporation by reference in the Registration Statements of RCM Technologies, Inc. (the “Company”) on Form S‐8 (Nos. 333-269026, 333-261767, 333-251516, 333-222151, 333-200826, 333-165482 and 333-145904), and on Form S-3 (No. 333-278376) of our reports dated March 13, 2025, relating to the consolidated financial statements of RCM Technologies, Inc. as of and for the years ended December 28, 2024 and December 30, 2023, and the effectiveness of internal control over financial reporting of RCM Technologies, Inc. as of December 28, 2024, included in this Annual Report on Form 10-K for the year ended December 28, 2024.

 

 

/s/ WithumSmith+Brown, PC
Red Bank, New Jersey
March 13, 2025

 

 

EXHIBIT 31.1

 

CERTIFICATION REQUIRED BY

RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

I, Bradley S. Vizi, certify that:

 

1.     I have reviewed this annual report on Form 10-K of RCM Technologies, Inc. (the “registrant”);

 

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.     The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b)  Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d)   Disclosed in this annual report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.     The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

 

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: March 13, 2025	/s/	Bradley S. Vizi
		Bradley S. Vizi Executive Chairman and President

 

 

 

EXHIBIT 31.2

 

CERTIFICATION REQUIRED BY

RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

I, Kevin D. Miller, certify that:

 

1.     I have reviewed this annual report on Form 10-K of RCM Technologies, Inc. (the “registrant”);

 

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.     The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b)  Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d)   Disclosed in this annual report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.     The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

 

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: March 13, 2025	/s/	Kevin D. Miller
		Kevin D. Miller Chief Financial Officer, Treasurer and Secretary

 

 

EXHIBIT 32.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

 

 

In connection with the Annual Report on Form 10-K of RCM Technologies, Inc. (the “Company”) for the fiscal year ended December 28, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Bradley S. Vizi, Executive Chairman and President of the Company, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, to my knowledge, that:

 

(1)   The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended (15 U.S.C. section 78m (a)); and

 

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

/s/	Bradley S. Vizi
	Bradley S. Vizi Executive Chairman and President March 13, 2025

 

A signed original of this written statement required by Section 906 has been provided to RCM Technologies, Inc. and will be retained by RCM Technologies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

 

 

EXHIBIT 32.2

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

 

 

In connection with the Annual Report on Form 10-K of RCM Technologies, Inc. (the “Company”) for the fiscal year ended December 28, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Kevin D. Miller, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, to my knowledge, that:

 

(1)   The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended (15 U.S.C. section 78m (a)); and

 

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

/s/	Kevin D. Miller
	Kevin D. Miller Chief Financial Officer, Treasurer and Secretary March 13, 2025

 

A signed original of this written statement required by Section 906 has been provided to RCM Technologies, Inc. and will be retained by RCM Technologies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

v3.25.0.1

Document And Entity Information - USD ($)	12 Months Ended
	Dec. 28, 2024	Mar. 12, 2025	Jun. 28, 2024
Document Information [Line Items]
Entity Central Index Key	0000700841
Entity Registrant Name	RCM TECHNOLOGIES, INC.
Amendment Flag	false
Current Fiscal Year End Date	--12-28
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2024
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 28, 2024
Document Transition Report	false
Entity File Number	1-10245
Entity Incorporation, State or Country Code	NV
Entity Tax Identification Number	95-1480559
Entity Address, Address Line One	2500 McClellan Avenue, Suite 350
Entity Address, City or Town	Pennsauken
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	08109-4613
City Area Code	856
Local Phone Number	356-4500
Title of 12(b) Security	Common Stock, par value $0.05 per share
Trading Symbol	RCMT
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Document Financial Statement Error Correction [Flag]	false
Entity Shell Company	false
Entity Public Float			$ 84,800,000
Entity Common Stock, Shares Outstanding		7,588,577
Auditor Name	WithumSmith+Brown, PC
Auditor Location	Red Bank, New Jersey
Auditor Firm ID	100

v3.25.0.1

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 28, 2024	Dec. 30, 2023
Current assets:
Cash and cash equivalents	$ 4,729	$ 6,284
Accounts receivable, net of provision for credit losses of $1,570 and $1,600 at December 28, 2024 and December 30, 2023, respectively	77,960	70,690
Transit accounts receivable	7,315	8,891
Prepaid expenses and other current assets	7,034	4,637
Total current assets	97,038	90,502
Property, Plant and Equipment, Net	7,368	4,005
Other assets:
Deposits	230	313
Deferred tax assets, foreign	120	55
Goodwill	22,147	22,147
Operating right of use asset	5,174	2,779
Intangible assets, net	0	683
Total other assets	27,671	25,977
Total assets	132,077	120,484
Accounts payable and accrued expenses	13,369	12,454
Transit accounts payable	23,870	31,102
Accrued payroll and related costs	9,929	11,203
Finance lease payable	698	233
Income taxes payable	346	330
Operating right of use liability	1,046	693
Contingent consideration from acquisitions	212	300
Deferred revenue	4,163	1,881
Total current liabilities	53,633	58,196
Finance lease payable, net of current position	1,112	0
Contingent consideration from acquisitions, net of current position	0	1,671
Operating right of use liability, net of current position	4,355	2,268
Borrowings under line of credit	34,967	30,804
Total liabilities	98,593	94,694
Contingencies (note 16) and Commitments (note 18)
Stockholders’ equity:
Preferred stock, $1.00 par value; 5,000,000 shares authorized; no shares issued or outstanding	0	0
Common stock, $0.05 par value; 40,000,000 shares authorized;17,838,372 shares issued and 7,602,113 shares outstanding at December 28, 2024 and 17,673,427 shares issued and 7,844,821 shares outstanding at December 30, 2023	890	882
Additional paid-in capital	118,845	116,579
Accumulated other comprehensive loss	(2,920)	(2,813)
Accumulated deficit	(5,938)	(19,265)
Treasury stock, 10,236,259 shares at December 28, 2024 and 9,828,606 shares at December 30, 2023	(77,393)	(69,593)
Stockholders’ equity	33,484	25,790
Total liabilities and stockholders’ equity	132,077	120,484
Foreign Tax Jurisdiction [Member]
Other assets:
Deferred income taxes, net	0	187
Domestic Tax Jurisdiction [Member]
Other assets:
Deferred income taxes, net	$ 4,526	$ 1,568

v3.25.0.1

Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands	Dec. 28, 2024	Dec. 30, 2023
Accounts receivable, provision for credit losses	$ 1,570	$ 1,600
Preferred stock par value (in dollars per share)	$ 1	$ 1
Preferred stock, authorized (in shares)	5,000,000	5,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.05	$ 0.05
Common stock, authorized (in shares)	40,000,000	40,000,000
Common stock, issue (in shares)	17,838,372	17,673,427
Common stock, outstanding (in shares)	7,602,113	7,844,821
Treasury Stock, Common, Shares	10,236,259	9,828,606

v3.25.0.1

Consolidated Statements of Operations - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Revenue	$ 278,380	$ 263,237
Cost of services	198,602	186,541
Gross profit	79,778	76,696
Operating costs and expenses
Selling, general and administrative	56,787	52,185
Depreciation and amortization of property and equipment	1,419	1,032
Amortization of acquired intangible assets	136	182
Impairment of intangible assets	547	0
Potential stock issuance and financing transactions	323	0
Remeasurement of contingent consideration	(1,759)	0
Gain on sale of assets	0	(395)
Operating costs and expenses	57,453	53,004
Operating income	22,325	23,692
Other expense (income)
Interest expense and other, net	2,215	1,399
(Gain) loss on foreign currency transactions	(80)	98
Other expense, net	2,135	1,497
Income before income taxes	20,190	22,195
Income tax expense	6,863	5,364
Net income	$ 13,327	$ 16,831
Basic net earnings per share (in dollars per share)	$ 1.72	$ 2.03
Diluted net earnings per share (in dollars per share)	$ 1.68	$ 1.96

v3.25.0.1

Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Net income	$ 13,327	$ 16,831
Other comprehensive (loss) income	(107)	50
Comprehensive income	$ 13,220	$ 16,881

v3.25.0.1

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Common Stock [Member]	Additional Paid-in Capital [Member]	AOCI Attributable to Parent [Member]	Retained Earnings [Member]	Treasury Stock, Common [Member]	Total
Balance (in shares) at Dec. 31, 2022	17,287,967				8,002,649
Balance at Dec. 31, 2022	$ 863	$ 113,878	$ (2,863)	$ (36,096)	$ (43,820)	$ 31,962
Issuance of stock under employee stock purchase plan (in shares)	66,501				0
Issuance of stock under employee stock purchase plan	$ 3	699	0	0	$ 0	702
Equity compensation expense from awards issued	$ 0	2,092	0	0		2,092
Issuance of stock upon vesting of restricted share awards (in shares)	310,959				0
Issuance of stock upon vesting of restricted share awards	$ 16	(16)	0	0	$ 0	0
Effect of excess tax deduction over book expense associated with exercises of equity awards	$ (0)	206	(0)	(0)	$ (0)	206
Common stock issued for acquisition (in shares)	8,000				0
Common stock issued for acquisition	$ 0	132	0	0	$ 0	$ 132
Purchase of treasury stock (in shares)	0				1,825,957	1,825,957
Purchase of treasury stock	$ 0	0	0	0	$ (25,773)	$ (25,773)
Foreign currency translation adjustment	0	0	50	0		50
Net income	$ 0	0	0	16,831		16,831
Balance (in shares) at Dec. 30, 2023	17,673,427				9,828,606
Balance at Dec. 30, 2023	$ 882	116,579	(2,813)	(19,265)	$ (69,593)	25,790
Issuance of stock under employee stock purchase plan (in shares)	45,611				0
Issuance of stock under employee stock purchase plan	$ 2	726	0	0	$ 0	728
Equity compensation expense from awards issued	$ 0	2,864	0	0		2,864
Issuance of stock upon vesting of restricted share awards (in shares)	163,901				0
Issuance of stock upon vesting of restricted share awards	$ 8	(9)	0	0	$ 0	$ (1)
Purchase of treasury stock (in shares)	0				407,653	407,653
Purchase of treasury stock	$ 0	0	0	0	$ (7,800)	$ (7,800)
Foreign currency translation adjustment	0	0	(107)	0		(107)
Net income	$ 0	0	0	13,327		13,327
Retirement of common shares (in shares)	(44,567)				0
Retirement of common shares	$ (2)	(1,315)	0	0	$ 0	(1,317)
Balance (in shares) at Dec. 28, 2024	17,838,372				10,236,259
Balance at Dec. 28, 2024	$ 890	$ 118,845	$ (2,920)	$ (5,938)	$ (77,393)	$ 33,484

v3.25.0.1

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Cash flows from operating activities:
Net income	$ 13,327	$ 16,831
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	2,102	1,214
Gain on sale of assets	0	(395)
Equity compensation expense from awards issued	2,864	2,092
Effect of excess tax deduction on equity awards	0	(206)
Remeasurement of contingent consideration	(1,759)	0
Provision for credit losses on accounts receivable	(31)	656
Deferred income tax expense	2,706	41
Change in operating right of use assets	1,011	919
Changes in operating assets and liabilities:
Accounts receivable	(7,271)	(20,576)
Prepaid expenses and other current assets	(2,392)	3
Net of transit accounts receivable and payable	(5,656)	15,724
Accounts payable and accrued expenses	1,101	(1,506)
Accrued payroll and related costs	(1,265)	(1,825)
Right of use liabilities	(966)	(1,353)
Income taxes payable	(34)	(242)
Deferred revenue	2,282	762
Deposits	83	(141)
Total adjustments and changes in operating assets and liabilities	(7,157)	(4,349)
Net cash provided by operating activities	6,170	12,482
Cash flows from investing activities:
Property and equipment acquired	(2,572)	(2,931)
Proceeds from sale of assets	0	395
Net cash used in investing activities	(2,572)	(2,536)
Cash flows from financing activities:
Borrowings under line of credit	154,122	148,957
Repayments under line of credit	(149,959)	(126,936)
Issuance of stock for employee stock purchase plan	728	702
Retirement of common shares	(1,317)	0
Changes in finance lease obligations	(602)	(463)
Contingent consideration paid	0	(339)
Common stock repurchase	(7,800)	(25,773)
Net cash used in financing activities	(4,828)	(3,852)
Effect of exchange rate changes on cash and cash equivalents	(325)	(149)
(Decrease) increase in cash and cash equivalents	(1,555)	5,945
Cash and cash equivalents at beginning of period	6,284	339
Cash and cash equivalents at end of period	4,729	6,284
Supplemental cash flow information:
Interest	2,145	1,192
Income taxes	5,347	4,447
Non-cash operating activities:
Right of use assets obtained in exchange for lease obligations	3,407	33
Non-cash financing activities:
Value of shares issued as contingent consideration	0	132
Software purchased under finance lease	$ 2,172	$ 0

v3.25.0.1

Insider Trading Arrangements	12 Months Ended
	Dec. 28, 2024 shares
Trading Arrangements, by Individual [Table]
Material Terms of Trading Arrangement [Text Block]	ITEM 9B. OTHER INFORMATION   (a)          Form 8-K Disclosure   On March 12, 2025, the Company and Mr. Vizi entered into an amendment and restatement of his Executive Severance Agreement dated June 1, 2018, which was filed as an exhibit to the Company’s Current Report on Form 8-K dated June 7, 2018 (the "Severance Agreement").    The amended and restated agreement modified:     ● the amount that Mr. Vizi would receive if either (a) he is involuntarily terminated by the Company for any reason other than "Cause" (as defined in the Severance Agreement), "Disability" (as defined in the Severance Agreement) or death, or (b) he resigns for "Good Reason" (as defined in the Severance Agreement), and, in each case, the termination is not a "Termination Related to a Change in Control" (as defined in the Severance Agreement).  Mr. Vizi will receive, among other amounts, the following severance payments in such event (the changes made by the amendment and restatement are noted):     o an amount equal to 2.0 times (modified by the amendment and restatement from 1.5 times) the sum of (a) Mr. Vizi's annual base salary as in effect immediately prior to the termination date (before taking into account any reduction that constitutes Good Reason) ("Annual Base Salary") and (b) highest annual bonus paid to Mr. Vizi in any of the five fiscal years immediately preceding Mr. Vizi's termination date or the amount that would be granted to him for the subsequent year, at target (modified by the amendment and restatement to increase the measurement period from three to five years and to add the subsequent year at target), which for all purposes under the Severance Agreement shall be deemed to include the grant date fair value of any restricted stock units granted subject to time-based or performance-based vesting (modified by the amendment and restatement to add performance-based equity, rather than only time-based) only to time-based vesting ("Bonus"), to be paid in installments over the twelve-month period following Mr. Vizi's termination date; and     ● the multiplier applicable to the amount that Mr. Vizi would receive, if a Change in Control occurs and he experiences a qualifying termination, from 2.0 times, as set forth in the original Severance Agreement, to 2.99 times, with the definition of Bonus for the purpose of such calculation modified as described above.     The foregoing description of the amendment and restatement to the Severance Agreement is qualified in its entirety by the full text of the Amended and Restated Executive Severance Agreement, a copy of which is filed herewith as Exhibit 10(m).   (b)          Rule 10b5-1 Trading Plans   As disclosed in the table below, during the three months ended December 28, 2024, certain of the Company’s directors and officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted a “Rule 10b5-1 trading arrangement” (as defined in Item 408(a) of Regulation S-K):   Name Position Action Adoption Date Expiration Date Aggregate Numbers of Common Stock to be Purchased/Sold   Bradley S. Vizi Executive Chairman & President Adopted December 7, 2023 March 7, 2026   650,000 (1) Michael Saks   Division President, Health Care Services Adopted December 5, 2023 December 1, 2024   18,000 (1) Kevin D. Miller   Chief Financial Officer Adopted January 1, 2025 December 31, 2026   183,600 (1) ___________________   (1) The aggregate number of shares that can be sold under the plan is allocated into a series of tranches that would be sold at laddered prices as outlined in the plan.   Other than as disclosed above, no other officer or director of the Company adopted, terminated, or modified a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” (as defined in Item 408(a) of Regulation S-K).
Rule 10b5-1 Arrangement Terminated [Flag]	false
Non-Rule 10b5-1 Arrangement Adopted [Flag]	false
Non-Rule 10b5-1 Arrangement Terminated [Flag]	false
Michael Saks [Member]
Trading Arrangements, by Individual [Table]
Rule 10b5-1 Arrangement Terminated [Flag]	true
Trading Arrangement, Individual Name	Michael Saks
Trading Arrangement, Individual Title	Division President, Health Care Services
Rule 10b5-1 Arrangement Adopted [Flag]	true
Trading Arrangement Adoption Date	December 5, 2023
Trading Arrangement Termination Date	December 1, 2024
Trading Arrangement, Securities Aggregate Available Amount	18,000
Bradley S. Vizi [Member]
Trading Arrangements, by Individual [Table]
Trading Arrangement, Individual Name	Bradley S. Vizi
Trading Arrangement, Individual Title	Executive Chairman & President
Rule 10b5-1 Arrangement Adopted [Flag]	true
Trading Arrangement Adoption Date	December 7, 2023
Trading Arrangement Termination Date	March 7, 2026
Trading Arrangement, Securities Aggregate Available Amount	650,000
Kevin D. Miller [Member]
Trading Arrangements, by Individual [Table]
Trading Arrangement, Individual Name	Kevin D. Miller
Trading Arrangement, Individual Title	Chief Financial Officer
Rule 10b5-1 Arrangement Adopted [Flag]	true
Trading Arrangement Adoption Date	January 1, 2025
Trading Arrangement Termination Date	December 31, 2026
Trading Arrangement, Securities Aggregate Available Amount	183,600

v3.25.0.1

Cybersecurity Risk Management and Strategy Disclosure	12 Months Ended
	Dec. 28, 2024
Cybersecurity Risk Management, Strategy, and Governance [Line Items]
Cybersecurity Risk Management Processes for Assessing, Identifying, and Managing Threats [Text Block]	ITEM 1C. CYBERSECURITY   Cybersecurity Risk Management and Strategy   The Company has developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of its critical systems and information. The Company’s cybersecurity risk management program includes a cybersecurity incident response plan and is integrated with the Company’s overall enterprise risk management program, sharing common methodologies, reporting channels and governance processes that apply across the enterprise risk management program to other legal, compliance, strategic, operational and financial risk areas. While the Company may not meet any particular standard, specification or requirement of the Center for Internet Security Critical Security Controls, the Company utilizes such controls as a guide to help identify, assess and manage cybersecurity risks relevant to the business. The Company has implemented cybersecurity policies and frameworks based on industry and governmental standards to align closely with requirements, instructions, and guidance from ISO27001, NIST, CMMC, GDPR, HIPAA, SOC and SOX Compliance.   Our cybersecurity risk management program includes, among other things:     ● risk assessments designed to help identify material cybersecurity risks to critical systems and information services;   ● a team comprising information technology (IT) security, IT infrastructure, and IT compliance personnel principally responsible for directing (i) cybersecurity risk assessment processes, (ii) security processes and (iii) planned responses to cybersecurity incidents;   ● the use of external cybersecurity service providers, where appropriate, to assess, test or otherwise assist with aspects of security processes;   ● cybersecurity awareness training of employees with access to IT systems;   ● a cybersecurity incident response plan and Security Operations Center to respond to cybersecurity incidents; and   ● a third-party risk management process for service providers.   During the year ended December 28, 2024, the Company has not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected operations, business strategy, results of operations or financial condition. However, the Company expects to continue to face certain risks from ongoing cybersecurity threats that, if realized, are reasonably likely to materially affect the Company, including our operations, business strategy, results of operations or financial condition. See Risk Factors – Cyber Security, Data Privacy and Data Center Capacity and Telecommunication Links.
Cybersecurity Risk Management Processes Integrated [Flag]	true
Cybersecurity Risk Management Processes Integrated [Text Block]	The Company has developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of its critical systems and information. The Company’s cybersecurity risk management program includes a cybersecurity incident response plan and is integrated with the Company’s overall enterprise risk management program, sharing common methodologies, reporting channels and governance processes that apply across the enterprise risk management program to other legal, compliance, strategic, operational and financial risk areas. While the Company may not meet any particular standard, specification or requirement of the Center for Internet Security Critical Security Controls, the Company utilizes such controls as a guide to help identify, assess and manage cybersecurity risks relevant to the business. The Company has implemented cybersecurity policies and frameworks based on industry and governmental standards to align closely with requirements, instructions, and guidance from ISO27001, NIST, CMMC, GDPR, HIPAA, SOC and SOX Compliance.
Cybersecurity Risk Management Third Party Engaged [Flag]	true
Cybersecurity Risk Third Party Oversight and Identification Processes [Flag]	true
Cybersecurity Risk Materially Affected or Reasonably Likely to Materially Affect Registrant [Flag]	false
Cybersecurity Risk Materially Affected or Reasonably Likely to Materially Affect Registrant [Text Block]	During the year ended December 28, 2024, the Company has not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected operations, business strategy, results of operations or financial condition. However, the Company expects to continue to face certain risks from ongoing cybersecurity threats that, if realized, are reasonably likely to materially affect the Company, including our operations, business strategy, results of operations or financial condition. See Risk Factors – Cyber Security, Data Privacy and Data Center Capacity and Telecommunication Links.
Cybersecurity Risk Board of Directors Oversight [Text Block]	Cybersecurity Governance   The Company’s Board considers cybersecurity risk as part of its risk oversight function and considers cybersecurity and IT risks as key strategic risks of the Company. The Board oversees management’s implementation of the Company’s cybersecurity risk management program, receiving at least annual updates from management (including our Chief Information Officer) on cybersecurity risks, including briefings on the Company’s cyber risk management program and cybersecurity incidents, and reviewing cybersecurity topics impacting companies with management and external experts.   The Company’s Chief Information Officer leads the IT and cybersecurity functions and has primary responsibility for leading the Company’s overall cybersecurity risk management program, supervising both internal cybersecurity personnel and external cybersecurity service providers. The Company’s cybersecurity function is responsible for assessing and managing material risks from cybersecurity threats, as well as informing management about and monitoring the prevention, detection, mitigation, and remediation of cybersecurity risks and incidents through various means, which include briefings with internal security personnel, threat intelligence and other information obtained from governmental, public or private sources, including external cybersecurity service providers and alerts and reports produced by security tools deployed in the IT environment.   The Company’s Chief Information Officer and Vice President of IT security and Compliance have significant experience in managing and leading information systems and deploying cybersecurity technologies and have extensive cybersecurity training and knowledge. The Company’s Vice President of IT security and Compliance has several industry certifications, including CISSP (Certified Information Security System Professional), CCSP (Certified Cloud Security Professional) and CCSK (Certificate of Cloud Security Knowledge). The Company’s Chief Information Officer reports to the Chief Executive Officer, and the Company’s Vice President of IT Security and Compliance reports to the Company’s Chief Information Officer.
Cybersecurity Risk Board Committee or Subcommittee Responsible for Oversight [Text Block]	The Company’s Board considers cybersecurity risk as part of its risk oversight function and considers cybersecurity and IT risks as key strategic risks of the Company. The Board oversees management’s implementation of the Company’s cybersecurity risk management program, receiving at least annual updates from management (including our Chief Information Officer) on cybersecurity risks, including briefings on the Company’s cyber risk management program and cybersecurity incidents, and reviewing cybersecurity topics impacting companies with management and external experts.
Cybersecurity Risk Role of Management [Text Block]	The Company’s Chief Information Officer leads the IT and cybersecurity functions and has primary responsibility for leading the Company’s overall cybersecurity risk management program, supervising both internal cybersecurity personnel and external cybersecurity service providers. The Company’s cybersecurity function is responsible for assessing and managing material risks from cybersecurity threats, as well as informing management about and monitoring the prevention, detection, mitigation, and remediation of cybersecurity risks and incidents through various means, which include briefings with internal security personnel, threat intelligence and other information obtained from governmental, public or private sources, including external cybersecurity service providers and alerts and reports produced by security tools deployed in the IT environment.
Cybersecurity Risk Management Positions or Committees Responsible [Flag]	true
Cybersecurity Risk Management Expertise of Management Responsible [Text Block]	The Company’s Chief Information Officer and Vice President of IT security and Compliance have significant experience in managing and leading information systems and deploying cybersecurity technologies and have extensive cybersecurity training and knowledge. The Company’s Vice President of IT security and Compliance has several industry certifications, including CISSP (Certified Information Security System Professional), CCSP (Certified Cloud Security Professional) and CCSK (Certificate of Cloud Security Knowledge). The Company’s Chief Information Officer reports to the Chief Executive Officer, and the Company’s Vice President of IT Security and Compliance reports to the Company’s Chief Information Officer.
Cybersecurity Risk Management Positions or Committees Responsible Report to Board [Flag]	true

v3.25.0.1

Note 1 - Summary of Significant Accounting Policies	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES   Description of Business and Basis of Presentation   RCM Technologies, Inc. (the “Company” or “RCM”) is a premier provider of business and technology solutions designed to enhance and maximize the operational performance of its customers through the adaptation and deployment of advanced engineering, life sciences, data and solutions. Additionally, the Company provides specialty healthcare staffing services through its Specialty Health Care Services group. RCM’s offices are primarily located in major metropolitan centers throughout North America, with additional offices in the Netherlands, Philippines, Serbia and Germany.   The consolidated financial statements are comprised of the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.   Cash and Cash Equivalents   The Company considers its holdings of highly liquid money-market instruments and certificates of deposit to be cash equivalents if the securities mature within 90 days from the date of acquisition.  These investments are carried at cost, which approximates fair value.  The Company has significant cash balances at financial institutions, which, throughout the year, regularly exceed the federally insured limit of $250. Any loss incurred or lack of access to uninsured funds could have a significant adverse impact on the Company’s financial condition, results of operations and cash flows.   The Company held $269 and $103 of cash and cash equivalents in Canadian banks as of December 28, 2024 and December 30, 2023, respectively, which was held principally in Canadian dollars.  The Company held $496 and $638 of cash and cash equivalents in Serbian banks as of December 28, 2024 and December 30, 2023, respectively, which was held in various currencies. The Company held $556 of cash and cash equivalents in German banks as of December 28, 2024, which was held primarily in Euros. The office in Germany was opened in April 2023. The Company held $2 and $4 of cash and cash equivalents in Netherlands banks as of December 28, 2024 and December 30, 2023, respectively, which was held in various currencies.   Fair Value of Financial Instruments   The Company’s carrying value of financial instruments, consisting primarily of accounts receivable, transit accounts receivable, accounts payable and accrued expenses, transit accounts payable and borrowings under line of credit approximates fair value due to their liquidity or their short-term nature and the line of credit’s variable interest rate. The Company does not have derivative products in place to manage risks related to foreign currency fluctuations for its foreign operations or for interest rate changes.   Accounts Receivable and Provision for Credit Losses   The Company’s accounts receivable are primarily due from trade customers.  Credit is extended based on evaluation of customers’ financial condition and, generally, collateral is not required.  Accounts receivable payment terms vary and are stated in the financial statements at amounts due from customers net of a provision for credit losses.  Accounts outstanding longer than the payment terms are considered past due.  The Company determines its provision by considering a number of factors, including the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole.  The Company writes off accounts receivable when they become uncollectible, and payments subsequently received on such receivables previously written off are credited to bad debt expense.     Unbilled Accounts Receivable and Work-in-Process   Unbilled receivables primarily represent revenue earned whereby those services are ready to be billed as of the balance sheet ending date. Work-in-process primarily represents revenue earned under contracts which the Company is contractually precluded from invoicing until future dates as project milestones are realized. The Company follows Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers when recording revenue on unbilled accounts receivable and work-in-process. See Note 4 for further details.   Transit Accounts Receivable and Transit Accounts Payable   From time to time, the Company’s Engineering segment enters into agreements to provide, among other things, construction management and engineering services.  Pursuant to these agreements, the Company a) may purchase equipment on behalf of the Company’s customer or engage subcontractors to provide construction or other services; b) typically earns a fixed percentage of the total project value; and c) assumes no ownership or risks of inventory.  In such situations, the Company acts as an agent under the provisions of FASB ASC 606 “Revenue from Contracts with Customers” and therefore recognizes revenue on a “net-basis.”  The Company records revenue on a “net” basis on relevant engineering and construction management projects, which require subcontractor/procurement costs or transit costs. In those situations, the Company charges the client a negotiated fee, which is reported as net revenue when earned.    Under the terms of the agreements, the Company is typically not required to pay the subcontractor until after the corresponding payment from the Company’s end-client is received. Upon invoicing the end-client on behalf of the subcontractor or staffing agency, the Company records this amount simultaneously as both a “transit account receivable” and “transit account payable,” as the amount when paid to the Company is due to and generally paid to the subcontractor within a few days. The Company typically does not pay a given transit account payable until the related transit account receivable is collected. The Company is typically obligated to pay the subcontractor or staffing agency whether or not the client pays the Company. The Company’s transit accounts payable generally exceeds the Company’s transit accounts receivable but absolute amounts and spreads fluctuate significantly from quarter to quarter in the normal course of business.   Property and Equipment   Property and equipment are stated at cost, less accumulated depreciation and amortization, and are depreciated or amortized on the straight-line method at rates calculated to provide for retirement of assets at the end of their estimated useful lives. Computer hardware and software, and furniture and office equipment are typically depreciated over five years. Leasehold improvements are amortized over the shorter of the estimated life of the asset or the lease term.     Intangible Assets   The Company’s intangible assets have been generated through acquisitions. The Company maintains responsibility for valuing and determining the useful life of intangible assets. As a general rule, the Company amortizes restricted covenants over four years and customer relationships over six years. However, circumstances may dictate other amortization terms as determined by the Company and assisted by their third party advisors.   Canadian Sales Tax   The Company is required to charge and collect sales tax for all Canadian clients and remits invoiced sales tax monthly to the Canadian taxing authorities whether collected or not. The Company does not collect the sales tax from its clients until they have paid their respective invoices. The Company includes uncollected Canadian sales tax invoiced to clients in its prepaid and other current assets.   Goodwill   Goodwill is not amortized but is subject to periodic testing for impairment in accordance with FASB ASC 350 “Intangibles - Goodwill and Other.” The Company tests goodwill for impairment on an annual basis as of the last day of the Company’s fiscal December each year or more frequently if events occur or circumstances change indicating that the fair value of the goodwill may be below its carrying amount. The Company has three reporting units. The Company uses a market-based approach to determine the fair value of the reporting units. This approach uses earnings/revenue multiples of similar companies recently completing acquisitions and the ability of our reporting units to generate cash flows as measures of fair value of our reporting units.   The Company did not record a goodwill impairment charge in fiscal years ended December 28, 2024 and December 30, 2023. There can be no assurance that future indicators of impairment and tests of goodwill impairment will not result in an impairment charge.   Long-Lived and Intangible Assets   The Company evaluates long-lived assets and intangible assets with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When the Company determines that it is probable that undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. Assets to be disposed of by sale, if any, are reported at the lower of the carrying amount or fair value less cost to sell. The Company’s intangible assets consist of customer relationships and non-compete agreements.       Software   In accordance with FASB ASC 350-40 “Accounting for Internal Use Software,” certain costs related to the development or purchase of internal-use software are capitalized and amortized over the estimated useful life of the software. During the fiscal years ended December 28, 2024 and December 30, 2023, the Company capitalized $4,141 and $1,947, respectively, for software costs. The net balance after accumulated depreciation for all software costs capitalized as of December 28, 2024 and December 30, 2023 was $5,622 and $2,325, respectively.   Income Taxes   The Company makes judgments and interpretations based on enacted tax laws, published tax guidance, as well as estimates of future earnings. These judgments and interpretations affect the provision for income taxes, deferred tax assets and liabilities and the valuation allowance. The Company evaluated the deferred tax assets and determined on the basis of objective factors that the net assets will be realized through future years’ taxable income. In the event that actual results differ from these estimates and assessments, additional valuation allowances may be required. The Company did not have any valuation allowance as of December 28, 2024 and December 30, 2023.   The Company accounts for income taxes in accordance with FASB ACS 740 “Income Taxes” (FASB ASC 740) which requires an asset and liability approach of accounting for income taxes.  FASB ASC 740 requires assessment of the likelihood of realizing benefits associated with deferred tax assets for purposes of determining whether a valuation allowance is needed for such deferred tax assets.  Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that such tax rate changes are enacted. The Company measures its deferred tax assets and liabilities using the tax rates that the Company believes will apply in the years in which the temporary differences are expected to be recovered or paid. The Company and its wholly owned United States subsidiaries file a consolidated federal income tax return.  The Company also files tax returns in Canada, Germany, Philippines, Puerto Rico and Serbia.   The Company also follows the provisions of FASB ASC 740 which prescribes a model for the recognition and measurement of a tax position taken or expected to be taken in a tax return, and provides guidance on derecognition, classification, interest and penalties, disclosure and transition.  The Company’s policy is to record interest and penalty, if any, as interest expense.     Revenue Recognition   The Company records revenue under Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. Revenue is recognized when we satisfy a performance obligation by transferring services promised in a contract to a customer, in an amount that reflects the consideration that we expect to receive in exchange for those services. Performance obligations in our contracts represent distinct or separate service streams that we provide to our customers.   We evaluate our revenue contracts with customers based on the five-step model under ASC 606: (1) Identify the contract with the customer; (2) Identify the performance obligations in the contract; (3) Determine the transaction price; (4) Allocate the transaction price to separate performance obligations; and (5) Recognize revenue when (or as) each performance obligation is satisfied.   The Company derives its revenue from several sources. The Company’s Engineering Services and Life Sciences, Data and Solutions segments perform consulting and project solution services. The Healthcare segment specializes in long-term and short-term staffing and placement services to hospitals, schools and long-term care facilities amongst others. All of the Company’s segments perform staff augmentation services and derive revenue from permanent placement fees.   The following table presents our revenue disaggregated by revenue source for the fiscal years ended December 28, 2024 and December 30, 2023:       December 28, 2024     December 30, 2023   Specialty Health Care:                 Time and Material   $ 141,185     $ 134,941   Permanent Placement Services     1,494       1,300   Total Specialty Health Care   $ 142,679     $ 136,241                     Engineering:                 Time and Material   $ 47,157     $ 42,443   Fixed Fee     49,302       42,232   Permanent Placement Services     -       -   Total Engineering   $ 96,459     $ 84,675                     Life Sciences, Data and Solutions:                 Time and Material   $ 30,547     $ 35,368   Fixed Fee     8,452       6,551   Permanent Placement Services     243       402   Total Life Sciences, Data and Solutions   $ 39,242     $ 42,321       $ 278,380     $ 263,237           Time and Material The Company’s Health Care segment predominantly recognizes revenue through time and material work while its Engineering and Life Sciences, Data and Solutions segments recognize revenue through both time and material and fixed fee work. The Company’s time and material contracts are typically based on the number of hours worked at contractually agreed upon rates, therefore revenue associated with these time and materials contracts are recognized based on hours worked at contracted rates.    Fixed Fee From time to time and predominantly in our Engineering segment, the Company enters into contracts requiring the completion of specific deliverables.  The Company has master services agreements with many of its customers that broadly define terms and conditions. Actual services performed under fixed fee arrangements are typically delivered under purchase orders that more specifically define terms and conditions related to that fixed fee project. While these master services agreements can often span several years, the Company’s fixed fee purchase orders are typically performed over six to nine month periods.  In instances where project services are provided on a fixed-price basis, revenue is recorded in accordance with the terms of each contract.  For engineering contracts estimated costs are budgeted by project, the Company then recognizes revenue by applying the costs incurred to date against the total budgeted costs and applying the percentage of completed cost against the total contract value to recognize revenue for each period.  In certain instances, revenue is invoiced at the time certain milestones are reached, as defined in the contract.  Revenue under these arrangements are recognized as the costs on these contracts are incurred.  From time-to-time, amounts paid in excess of revenue earned and recognized are recorded as deferred revenue.  Some contracts also limit revenue and billings to specified maximum amounts.  Provisions for contract losses, if any, are made in the period such losses are determined.  For contracts where there is a specific deliverable and the work is not complete and the revenue is not recognized, the costs incurred are deferred as a prepaid asset.  The associated costs are expensed when the related revenue is recognized.   Permanent Placement Services The Company earns permanent placement fees from providing permanent placement services. These fees are typically based on a percentage of the compensation paid to the person placed with the Company’s client. The Company guarantees its permanent placements on a prorated basis for 90 days. In the event a candidate is not retained for the 90-day period, the Company will provide a suitable replacement candidate. In the event a replacement candidate cannot be located, the Company will provide a prorated refund to the client. An allowance for refunds, based upon the Company’s historical experience, is recorded in the financial statements. Permanent placement revenue was $1.5 million and $1.7 million for the fiscal years ended December 28, 2024 and December 30, 2023, respectively.   The deferred revenue balance as of December 28, 2024 and December 30, 2023 was $4.2 million and $1.9 million, respectively. Revenue is recognized when the service has been performed.  Deferred revenue may be recognized over a period exceeding one year from the time it was recorded on the balance sheet, although this is an infrequent occurrence.  In fiscal years ended December 28, 2024 and December 30, 2023, the Company recognized revenue of $1.9 million and $1.1 million, respectively, that was included in deferred revenue at the beginning of the period.       Transit Receivables and Transit Payables From time to time, the Company’s Engineering segment enters into agreements to provide, among other things, construction management and engineering services.  Pursuant to these agreements, the Company a) may purchase equipment on behalf of the Company’s customer or engage subcontractors to provide construction or other services; b) typically earns a fixed percentage of the total project value; and c) assumes no ownership or risks of inventory.  Under the terms of the agreements, the Company is typically not required to pay the subcontractor until after the corresponding payment from the Company’s end-client is received. Upon invoicing the end-client on behalf of the subcontractor or staffing agency, the Company records this amount simultaneously as both a “transit account receivable” and “transit account payable,” as the amount when paid to the Company is due to and generally paid to the subcontractor within a few days. The Company typically does not pay a given transit account payable until the related transit account receivable is collected. The Company is typically obligated to pay the subcontractor or staffing agency whether or not the client pays the Company. The Company’s transit accounts payable generally exceeds the Company’s transit accounts receivable but absolute amounts and spreads fluctuate significantly from quarter to quarter in the normal course of business. The transit accounts receivable was $7.3 million and related transit accounts payable was $23.9 million, for a net payable of $16.6 million, as of December 28, 2024. The transit accounts receivable was $8.9 million and related transit accounts payable was $31.1 million, for a net payable of $22.2 million, as of December 30, 2023.   Concentrations   During the fiscal year ended December 28, 2024, the Company had two customers exceed 10% of consolidated revenue, representing 19.5% and 14.1% of consolidated revenue, respectively. During the fiscal year ended December 30, 2023, the Company had two customers exceed 10% of consolidated revenue, representing 17.1% and 10.1% of consolidated revenue, respectively. All customers exceeding 10% of consolidated revenue during the periods presented are included in the Company’s Specialty Health Care segment.   The Company’s five, ten and twenty largest customers accounted for approximately 48.5%, 60.1% and 70.6%, respectively, of the Company’s revenue for the fiscal year ended December 28, 2024. The Company’s five, ten and twenty largest customers accounted for approximately 39.1%, 50.4% and 62.7%, respectively, of the Company’s revenue for the fiscal year ended December 30, 2023.   As of December 28, 2024, three clients represented more than 10% of the Company's accounts receivable, net, representing 20.4% and 12.5% from the Company's two largest Specialty Health Care clients and 11.4% from the Company's largest Engineering client. As of December 30, 2023, two clients represented more than 10% of the Company's accounts receivable, net, representing 21.2% and 14.7% from the Company's two largest Specialty Health Care clients.     Foreign Currency Translation   The functional currency of the Company’s Canadian, Serbian and German subsidiaries is the local currency. Assets and liabilities are translated at period-end exchange rates. Income and expense items are translated at weighted average rates of exchange prevailing during the year. Any translation adjustments are included in the accumulated other comprehensive income account in stockholders’ equity. Transactions executed in different currencies resulting in exchange adjustments are translated at spot rates and resulting foreign exchange transaction gains and losses are included in the results of operations.   Comprehensive Income   Comprehensive income consists of net income and foreign currency translation adjustments.   Per Share Data   Basic net income per share is calculated using the weighted-average number of common shares outstanding during the period. Diluted net income per share is calculated using the weighted-average number of common shares plus dilutive potential common shares outstanding during the period. Potential dilutive common shares consist of stock options and other stock-based awards under the Company’s stock compensation plans, when their impact is dilutive. Because of the Company’s capital structure, all reported earnings pertain to common shareholders and no other adjustments are necessary.   Share - Based Compensation   The Company recognizes share-based compensation over the vesting period of an award based on fair value at the grant date determined using the Black-Scholes option pricing model. Certain assumptions are used to determine the fair value of stock-based payment awards on the date of grant and require subjective judgment. Because employee stock options have characteristics significantly different from those of traded options, and because changes in the input assumptions can materially affect the fair value estimate, the existing models may not provide a reliable single measure of the fair value of the employee stock options. Management assesses the assumptions and methodologies used to calculate estimated fair value of stock-based compensation when share-based awards are granted. Circumstances may change and additional data may become available over time, which could result in changes to these assumptions and methodologies and thereby materially impact our fair value determination. If an employee leaves the firm before the vesting period has been met, those shares are forfeited and removed from the share – based compensation expense calculation. See Note 11 for additional share-based compensation information.   Restricted share and share unit awards are recognized at their fair value. The amount of compensation cost is measured on the grant date fair value of the equity instrument issued. The compensation cost of the restricted share and share unit awards is recognized over the vesting period of the restricted share and share unit awards on a straight-line basis. Restricted share and share unit awards typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period assuming the grantee’s restricted share or share unit award fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. Dividends for restricted share and share unit awards that ultimately do not vest are forfeited.     Advertising Costs   Advertising costs are expensed as incurred. Total advertising expense was $719 and $781 for the fiscal years ended December 28, 2024 and December 30, 2023, respectively.   Fair Value Measurements   The Company values its financial assets and liabilities based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  In order to increase consistency and comparability in fair value measurements, a fair value hierarchy was established that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:   Level 1:  Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.  The fair value hierarchy gives the highest priority to Level 1 inputs.   Level 2:  Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in inactive markets; or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data.   Level 3:  Unobservable inputs are used when little or no market data is available.  The fair value hierarchy gives the lowest priority to Level 3 inputs.   In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value.

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Note 2 - Fiscal Year	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Business Description and Basis of Presentation [Text Block]	2. FISCAL YEAR   The Company follows a 52/53 week fiscal reporting calendar ending on the Saturday closest to December 31. The fiscal years ended December 28, 2024 (fiscal 2024) and December 30, 2023 (fiscal 2023) consisted of fifty-two weeks each.

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Note 3 - Use of Estimates and Uncertainties	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Basis of Presentation and Significant Accounting Policies [Text Block]	3. USE OF ESTIMATES AND UNCERTAINTIES   The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.   The Company uses estimates to determine a provision for credit losses on its accounts receivable, contingent consideration, litigation, medical claims, vacation, goodwill impairment, if any, equity compensation, the tax rate applied and the valuation of certain assets and liability accounts. In addition, the Company reviews its estimated costs to complete a contract and adjusts those costs when necessary. These estimates can be significant to the operating results and financial position of the Company. The estimates are based upon various factors including current and historical trends, as well as other pertinent industry and regulatory authority information. Management regularly evaluates this information to determine if it is necessary to update the basis for its estimates and to adjust for known changes.   The Company has risk participation arrangements with respect to workers compensation and healthcare insurance. The amounts included in the Company’s costs related to this risk participation are estimated and can vary based on changes in assumptions, the Company’s claims experience or the providers included in the associated insurance programs.   The Company can be affected by a variety of factors including uncertainty relating to the performance of the general economy, competition, demand for the Company’s services, adverse litigation and claims and the hiring, training and retention of key employees.

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Note 4 - Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Loans, Notes, Trade and Other Receivables Disclosure [Text Block]	4.    ACCOUNTS RECEIVABLE   The Company’s accounts receivable are comprised as follows:       December 28, 2024     December 30, 2023   Billed   $ 55,224     $ 51,111   Unbilled     16,931       14,737   Work-in-progress     7,375       6,442   Provision for credit losses     (1,570 )     (1,600 )                   Accounts receivable, net   $ 77,960     $ 70,690     Unbilled receivables primarily represent revenue earned whereby those services are ready to be billed as of the balance sheet ending date. Work-in-progress primarily represents revenue earned under contracts which the Company contractually invoices at future dates.

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Note 5 - Property and Equipment	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Property, Plant and Equipment Disclosure [Text Block]	5.    PROPERTY AND EQUIPMENT   Property and equipment are comprised of the following:       December 28, 2024     December 30, 2023   Computers and systems   $ 8,448     $ 5,512   Equipment and furniture     306       262   Leasehold improvements     590       413   Laboratory equipment     196       173         9,540       6,360                     Less: accumulated depreciation and amortization     2,172       2,355                     Property and equipment, net   $ 7,368     $ 4,005     The Company periodically writes off fully depreciated and amortized assets.  The Company wrote off fully depreciated and amortized assets of $1,604 and $1,201 during the fiscal years ended December 28, 2024 and December 30, 2023, respectively. For the fiscal years ended December 28, 2024 and December 30, 2023, depreciation and amortization expense for property and equipment was $1,419 and $1,032, respectively.

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Note 6 - Acquisitions and Divestitures	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Business Combination Disclosure [Text Block]	6.    ACQUISITIONS AND DIVESTITURES   The purchase method of accounting in accordance with FASB ASC 805, “Business Combination,” was applied for all acquisitions. This requires the cost of an acquisition to be allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair values at the date of acquisition with the excess cost accounted for as goodwill. Goodwill arising from the acquisitions is attributable to expected sales synergies from combining the operations of the acquired business with those of the Company.   Potential future contingent payments to be made to all active acquisitions after December 28, 2024 are capped at a cumulative maximum of $0.2 million.   The changes in the liability for contingent consideration from acquisitions for the fiscal years ended December 28, 2024 and December 30, 2023 are as follows:   Balance as of December 31, 2022   $ 2,442             Contingent payments - cash     (339 ) Contingent payments - stock     (132 )           Balance as of December 30, 2023   $ 1,971             Remeasurement of contingent consideration     (1,759 )           Balance as of December 28, 2024   $ 212       Future Contingent Payments As of December 28, 2024, the Company had one acquisition agreement whereby additional contingent consideration may be earned by the sellers: effective September 30, 2018, the Company acquired certain assets of Thermal Kinetics Engineering, PLLC and Thermal Kinetics Systems, LLC. The Company estimates future contingent payments at December 28, 2024 as follows:       Total   Payable in fiscal 2025   $ 212     For acquisitions that involve contingent consideration, the Company records a liability equal to the fair value of the estimated contingent consideration obligation as of the acquisition date. The Company determines the acquisition date fair value of the contingent consideration based on the likelihood of paying the additional consideration. The fair value is estimated using projected future operating results and the corresponding future earn-out payments that can be earned upon the achievement of specified operating objectives and financial results by acquired companies using Level 3 inputs and the amounts are then discounted to present value. These liabilities are measured quarterly at fair value, and any change in the fair value of the contingent consideration liability is recognized in the consolidated statements of operations. During the measurement period, which may be up to one year from the acquisition date, the Company records adjustments to the assets acquired and liabilities assumed with the corresponding adjustment to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recognized in the consolidated statements of operations.     Estimates of future contingent payments are subject to significant judgment and actual payments may materially differ from estimates.  The Company estimates future contingent consideration payments based on forecasted performance and recorded the fair value of those expected payments as of December 28, 2024.  Contingent consideration related to acquisitions is recorded at fair value (level 3) with changes in fair value recorded in operating expense.   Divestiture of Assets On July 30, 2021, the Company sold the principal assets and certain liabilities of its Pickering and Kincardine offices in Ontario, Canada.  These two offices were often called Canada Power Systems and principally provided engineering services to two major nuclear power providers in Canada.  The two Canada Power Systems offices were part of a reporting unit within the Company’s Engineering segment.  The purchase agreement provided for a typical indemnity escrow held by an independent escrow agent.  The net proceeds released from the escrow account generated a gain on sale of assets of $0.4 million for the year ended December 30, 2023.

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Note 7 - Goodwill	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Goodwill Disclosure [Text Block]	7.    GOODWILL   Goodwill represents the premium paid over the fair value of the net tangible and intangible assets acquired in business combinations.  The Company tests goodwill for impairment on an annual basis as of the last day of the Company's fiscal year or more frequently if events occur or circumstances change indicating that the fair value of goodwill may be below the carrying amount.  The Company reviewed industry and market conditions, reporting unit specific events as well as overall financial performance and determined that no indicators of impairment of goodwill existed in its Engineering and Specialty Health Care segments during the fiscal year ended December 28, 2024 and for all segments during the year ended December 30, 2023.  Since the Company remeasured contingent consideration associated with its Life Sciences, Data and Solutions segment, the Company determined that further testing was necessary. After comparing the fair value of the Life Sciences, Data and Solutions segment to its carrying amount, the Company determined that no impairment loss occurred for the Company’s goodwill during the fiscal years ended December 28, 2024 or December 30, 2023.   The changes in the carrying amount of goodwill for the fiscal years ended December 28, 2024 and December 30, 2023 are as follows:       Engineering     Specialty Health Care     Life Sciences, Data & Solutions     Total   Balance as of December 31, 2022   $ 11,918     $ 2,398     $ 7,831     $ 22,147                                     No change in fiscal 2023     -       -       -       -                                     Balance as of December 30, 2023   $ 11,918     $ 2,398     $ 7,831     $ 22,147                                     No change in fiscal 2024     -       -       -       -                                     Balance as of December 28, 2024   $ 11,918     $ 2,398     $ 7,831     $ 22,147

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Note 8 - Intangible Assets	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Intangible Assets Disclosure [Text Block]	8.    INTANGIBLE ASSETS   The Company evaluates long-lived assets and intangible assets with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  When the Company determines that it is probable that undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value.  Assets to be disposed of by sale, if any, are reported at the lower of the carrying amount or fair value less cost to sell.  The Company’s intangible assets historically consist of customer relationships and non-compete agreements.  The Company determined that during the fiscal year ended December 28, 2024, its intangible asset balance became worthless and was written off.   The changes in the carrying amount of intangible assets for the fiscal years ended December 28, 2024 and December 30, 2023 are as follows:       Engineering     Specialty Health Care     Life Sciences, Data & Solutions     Total   Balance as of December 31, 2022   $ -     $ -     $ 865     $ 865                                     Amortization in fiscal 2023     -       -       182       182                                     Balance as of December 30, 2023   $ -     $ -     $ 683     $ 683                                     Amortization in fiscal 2024     -       -       136       136   Impairment in fiscal 2024     -       -       547       547                                     Balance as of December 28, 2024   $ -     $ -     $ -     $ -

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Note 9 - Line of Credit	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Debt Disclosure [Text Block]	9.    LINE OF CREDIT   On December 3, 2024, the Company entered into a Fifth Amended and Restated Loan Agreement (the “Fifth Amended and Restated Loan Agreement”) with Citizens Bank, N.A., as lender (in such capacity, the “Lender”) and as administrative agent and arranger (in such capacity, the “Administrative Agent”), to amend and restate in its entirety that certain Fourth Amended and Restated Agreement dated as of April 24, 2023 (as the same has been amended and modified prior to the date hereof, the “Existing Loan Agreement”).    The Fifth Amended and Restated Loan Agreement is increased from $45.0 million under the Fourth Amended and Restated Agreement to $65.0 million (with an accordion feature permitting the increase of the total commitment by an additional $20.0 million, subject to the consent of the Administrative Agent and the Lenders), and permits the Borrowers to request the issuance of trade and standby letters of credit thereunder. The Fifth Amended and Restated Loan Agreement has a maturity date of December 3, 2029.   Borrowings under the Revolving Credit Facility bear interest at one of two alternative rates, as selected by the Company at each incremental borrowing.  These alternatives are: (i) SOFR (Secured Overnight Financing Rate), plus applicable margin or (ii) the agent bank’s prime rate generally borrowed over shorter durations.  The Company also pays unused line fees based on the amount of the Revolving Credit Facility that is not drawn.  Unused line fees are recorded as interest expense. The effective weighted average interest rate, including unused line fees, for the fiscal years ended December 28, 2024 and December 30, 2023 were 6.6% and 6.5%, respectively.     All borrowings under the Fifth Amended and Restated Loan Agreement remain collateralized with substantially all of the Company’s assets, as well as the capital stock of its subsidiaries. The Revolving Credit Facility also contains various financial and non-financial covenants, such as a covenant that restricts the Company’s ability to borrow in order to pay dividends. As of December 28, 2024, the Company was in compliance with all covenants contained in the Revolving Credit Facility. The Company believes that it will maintain compliance with its financial covenants for the foreseeable future.   Borrowings under the line of credit as of December 28, 2024 and December 30, 2023 were $35.0 million and $30.8 million, respectively. There were letters of credit outstanding at December 28, 2024 and December 30, 2023 for $7.4 million and $2.0 million, respectively. At December 28, 2024 and December 30, 2023, the Company had availability for additional borrowings under the Revolving Credit Facility of $22.6 million and $12.1 million, respectively.

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Note 10 - Per Share Data	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Earnings Per Share [Text Block]	10.  PER SHARE DATA   The Company uses the treasury stock method to calculate the weighted-average shares outstanding used for diluted earnings per share. The number of weighted-average shares used to calculate basic and diluted earnings per share for the fiscal years ended December 28, 2024 and December 30, 2023 was determined as follows:       Fiscal Years Ended       December 28, 2024     December 30, 2023   Basic weighted average shares outstanding     7,737,063       8,308,867   Dilutive effect of outstanding restricted share awards     202,318       283,705                     Diluted weighted average shares outstanding     7,939,381       8,592,572     For the fiscal years ended December 28, 2024 and December 30, 2023, there were no anti-dilutive shares included in the calculation of common stock equivalents as there were no stock options outstanding.   Unissued shares of common stock were reserved for the following purposes:       December 28, 2024     December 30, 2023   Time-based restricted stock awards outstanding     289,421       376,618   Performance-based restricted stock awards outstanding     300,000       100,000   Future grants of options or shares     295,680       603,044   Shares reserved for employee stock purchase plan     252,119       297,730                     Total     1,137,220       1,377,392

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Note 11 - Share Based Compensation	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Share-Based Payment Arrangement [Text Block]	11.   SHARE BASED COMPENSATION   At December 28, 2024, the Company had two share-based employee compensation plans, the Employee Stock Purchase Plan and the 2014 Omnibus Equity Compensation Plan.   The Company measures the fair value of share-based awards, if and when granted, based on the Black-Scholes method and using the closing market price of the Company’s common stock on the date of grant. Awards typically vest over periods ranging from one to five years and expire within 10 years of issuance. The Company may also issue immediately vested equity awards. Share-based compensation expense related to time-based awards is amortized in accordance with applicable vesting periods using the straight-line method. The Company expenses performance-based awards only when the performance metrics are likely to be achieved and the associated awards are therefore likely to vest. Performance-based share awards that are likely to vest are also expensed on a straight-line basis over the vesting period but may vest on a retroactive basis or be reversed, depending on when it is determined that they are likely to vest, or in the case of a reversal when they are later determined to be unlikely to vest or forfeited. Discussion of share and share-based awards herein references awards of shares and share units.   Share-based compensation expense of $2.9 million and $2.1 million was recognized for the fiscal years ended December 28, 2024 and December 30, 2023, respectively. Share-based compensation for performance-based equity agreements was $1.6 million and $0.7 million for the fiscal years ended December 28, 2024 and December 30, 2023, respectively. As of December 28, 2024, there were 300,000 performance-based restricted stock awards outstanding. Share-based compensation expense is included in selling, general and administrative expense in the Company’s statement of operations.   As of December 28, 2024, the Company had $8.0 million of total unrecognized compensation cost, with approximately $2.6 million related to time-based non-vested share-based awards outstanding and $5.4 million related to performance-based non-vested share-based awards outstanding. The Company expects to recognize the expense associated with time-based non-vested share-based awards through fiscal 2029.  If earned, the Company will recognize the expense associated with performance-based non-vested share-based awards straight-line through fiscal 2027.  These amounts do not include a) the cost of any additional share-based awards granted in future periods or b) the impact of any potential changes in the Company’s forfeiture rate.    Incentive Share-Based Plans   Employee Stock Purchase Plan   The Company implemented the 2001 Employee Stock Purchase Plan (the “Purchase Plan”) with shareholder approval, effective January 1, 2001. Under the Purchase Plan, employees meeting certain specific employment qualifications are eligible to participate and can purchase shares of common stock semi-annually through payroll deductions at the lower of 85% of the fair market value of the stock at the commencement or end of the offering period. The purchase plan permits eligible employees to purchase shares of common stock through payroll deductions for up to 10% of qualified compensation, subject to maximum purchases in any one fiscal year of 3,000 shares.     Employee Stock Purchase Plan (Continued)   In fiscal 2015, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Purchase Plan by an additional 300,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,100,000 shares and to extend the expiration date of the Purchase Plan to December 31, 2025. In fiscal 2018, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Purchase Plan by an additional 300,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,400,000 shares. In fiscal 2021, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Purchase Plan by an additional 400,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,800,000 shares and the termination date of the Purchase Plan was extended to December 31, 2030.   The Company has two offering periods in the Purchase Plan coinciding with the Company’s first two fiscal quarters and the last two fiscal quarters. Actual shares are issued on the first business day of the subsequent offering period for the prior offering period payroll deductions. During the fiscal years ended December 28, 2024 and December 30, 2023, there were 45,611 and 66,501 shares issued under the Purchase Plan for net proceeds of $0.7 million and $0.7 million, respectively. As of December 28, 2024, there were 252,119 shares available for issuance under the Purchase Plan. Compensation expense, representing the discount to the quoted market price, for the Purchase Plan for the fiscal years ended December 28, 2024 and December 30, 2023 was $0.3 million and $0.3 million, respectively.   2014 Omnibus Equity Compensation Plan (the 2014 Plan)   The 2014 Plan, approved by the Company’s shareholders in December 2014, initially provided for the issuance of up to 625,000 shares of the Company’s common stock to officers, non-employee directors, employees of the Company and its subsidiaries, or consultants and advisors utilized by the Company.  In fiscal 2016, fiscal 2020 and fiscal 2022, the Company amended, or amended and restated, the 2014 Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance under the Plan by an additional 500,000, 850,000 and 1,000,000 shares, respectively, so that the total number of shares of stock reserved for issuance under the Plan is 2,975,000 shares.  The expiration date of the Plan is December 17, 2030, unless the 2014 Plan is terminated earlier by the Board or is extended by the Board with the approval of the stockholders.  The Compensation Committee of the Board of Directors determines the vesting period at the time of grant.   All stock awards typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period assuming the grantee’s stock award fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. As of December 28, 2024, there were no accrued dividends. Dividends for stock awards that ultimately do not vest are forfeited.     2014 Omnibus Equity Compensation Plan (the 2014 Plan) (Continued)   As of December 28, 2024, under the 2014 Plan, 289,421 time-based shares were outstanding, 300,000 performance-based restricted stock awards were outstanding and 295,680 shares were available for awards thereunder.   The intrinsic value of all equity grants as of December 28, 2024 and December 30, 2023 was $12.5 million and $13.8 million, respectively. These amounts are based on the equity price on the last trading day in the period presented.   Time-Based Restricted Stock Awards   From time-to-time the Company issues time-based restricted stock awards. The following summarizes the activity in the time-based restricted stock awards under the 2014 Plan during the fiscal year ended December 28, 2024:       Number of Time-Based Restricted Stock Awards     Weighted Average Grant Date Fair Value per Share   Outstanding non-vested at December 31, 2022     274,939     $ 3.59   Granted     293,978     $ 13.23   Vested     (181,197 )   $ 2.83   Forfeited or expired     (11,102 )   $ 2.23   Outstanding non-vested at December 30, 2023     376,618     $ 11.53   Granted     19,676     $ 22.62   Vested     (101,401 )   $ 10.32   Forfeited or expired     (5,472 )   $ 14.62   Outstanding non-vested at December 28, 2024     289,421     $ 12.65     Based on the closing price of the Company’s common stock of $23.17 per share on December 27, 2024 (the last trading day prior to December 28, 2024), the intrinsic value of the time-based non-vested restricted stock awards at December 28, 2024 was approximately $6.7 million. As of December 28, 2024, there was approximately $2.6 million of total unrecognized compensation cost related to time-based restricted stock awards, which is expected to be recognized over the average weighted remaining vesting period of the restricted stock awards through fiscal 2029.     Performance-Based Restricted Stock Awards   From time-to-time the Company issues performance-based restricted stock awards to its employees.  Performance-based restricted stock awards are typically vested based on certain multi-year performance metrics as determined by the Board of Directors Compensation Committee.   The following summarizes the activity in the performance-based restricted stock awards during the fiscal year ended December 28, 2024:       Number of Performance- Based Restricted Stock Awards     Weighted Average Grant Date Fair Value per Share   Outstanding non-vested at December 31, 2022     225,000     $ 8.73   Granted     -       -   Vested     (125,000 )   $ 6.15   Forfeited or expired     -       -   Outstanding non-vested at December 30, 2023     100,000     $ 11.96   Granted     300,000     $ 28.79   Vested     (62,500 )   $ 11.96   Forfeited or expired     (37,500 )   $ 11.96   Outstanding non-vested at December 28, 2024     300,000     $ 28.79     The Company assesses at each reporting date whether achievement of any performance condition is probable and recognizes the expense when achievement of the performance condition becomes probable.  The Company will then recognize the appropriate expense cumulatively in the year performance becomes probable and recognize the remaining compensation cost over the remaining requisite service period. If at a later measurement date, the Company determines that performance-based restricted stock awards deemed as likely to vest are deemed as unlikely to vest, the expense recognized will be reversed.    Share-based compensation for performance-based equity agreement was $1.6 million and $0.7 million for the fiscal years ended December 28, 2024 and December 30, 2023, respectively.    There were no immediately vested share awards during the fiscal year ended December 28, 2024. During the fiscal year ended December 30, 2023, the Company awarded 4,762 immediately vested share awards at an average price of $10.50.         Number of Restricted Stock Awards     Weighted Average Grant Date Fair Value per Share   Outstanding non-vested at December 31, 2022     499,939     $ 5.91   Granted – time-based vesting     293,978     $ 13.23   Granted – performance-based vesting     -       -   Vested     (306,197 )   $ 4.18   Forfeited or expired     (11,102 )   $ 2.23   Outstanding non-vested at December 30, 2023     476,618     $ 11.66   Granted – time-based vesting     19,676     $ 22.62   Granted – performance-based vesting     300,000     $ 28.79   Vested     (163,901 )   $ 10.94   Forfeited or expired     (42,972 )   $ 12.30   Outstanding non-vested at December 28, 2024     589,421     $ 20.86     Based on the closing price of the Company’s common stock of $23.17 per share on December 27, 2024, the intrinsic value of all outstanding unvested equity awards at December 28, 2024 was $12.5 million.

v3.25.0.1

Note 12 - Treasury Stock and Retired Share Transactions	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Treasury Stock [Text Block]	12.   TREASURY STOCK TRANSACTIONS   On March 29, 2024, the Board authorized a program to repurchase shares of its common stock up to an amount not to exceed $50.0 million, inclusive of amounts remaining under the existing repurchase authorization. The program (the Treasury Stock Repurchase Plan) is designed to provide the Company with enhanced flexibility over the long term to optimize its capital structure.  Shares of the Common Stock may be repurchased in the open market or through negotiated transactions.  The program may be terminated or suspended at any time at the discretion of the Company. The Company may enter into a Rule 10b5-1 trading plan to effect a portion of the authorized purchases if the criteria set forth in the plan are met. Such a plan would enable the Company to repurchase its shares during periods outside of its normal trading windows when the Company typically would not be active in the market.   On April 24, 2023, the Company agreed to repurchase, in a private transaction approved by the Board, 333,686 shares of common stock at a per-share price of $11.91 per share.   During the fiscal year ended December 28, 2024, the Company purchased 407,653 shares at an average price of $19.08 per share. During the fiscal year ended December 30, 2023, the Company purchased 1,825,957 shares at an average price of $14.00 per share. As of December 28, 2024, the Company has $42.2 million available for future treasury stock purchases.   The Company accrued $25 in excise tax associated with its Treasury Stock Repurchase Plan during the fiscal year ended December 28, 2024. Excise tax is recorded directly to additional paid-in capital.

v3.25.0.1

Note 13 - New Accounting Standards and Updates	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Accounting Standards Update and Change in Accounting Principle [Text Block]	13.   NEW ACCOUNTING STANDARDS   In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements through enhanced disclosures about significant segment expenses. The amendments require disclosure of significant segment expenses regularly provided to the chief operating decision maker (CODM) as well as other segment items, extend certain annual disclosures to interim periods, clarify the applicability to single reportable segment entities, permit more than one measure of profit or loss to be reported under certain conditions, and require disclosure of the title and position of the CODM. We adopted this ASU for the fiscal year ended December 28, 2024.   In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires the annual financial statements to include consistent categories and greater disaggregation of information in the rate reconciliation, and income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for the Company’s annual reporting periods beginning after December 15, 2024, with early adoption permitted, and should be applied on a prospective basis, with a retrospective option. We are currently evaluating the effect that adoption of this ASU will have on our disclosures.

v3.25.0.1

Note 14 - Segment Information	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Segment Reporting Disclosure [Text Block]	14.   SEGMENT INFORMATION   The Company follows ASC 280, “Segment Reporting,” which establishes standards for companies to report information about operating segments, geographic areas and major customers. The accounting policies of each reportable segment are the same as those described in the summary of significant accounting policies (see Note 1 to the Company’s Consolidated Financial Statements).   The Company reports segment information based on the management approach, which designates the internal reporting used by the Chief Operating Decision Makers (“CODMs”), who were Bradley Vizi, Chief Executive Officer, and Kevin Miller. Chief Financial Officer. The Company’s CODMs are responsible for making decisions regarding the Company’s business, including resource allocations and performance assessments based on historical and future segment revenue, operating expenses, and operating income (loss) before interest and taxes.   The tables below summarize the results of operations and total assets by segment provided to the CODMs. Segment operating income (loss) includes selling, general, and administrative expenses directly attributable to that segment and charges for allocating corporate costs to each of the operating segments. Please refer to the segment discussion on pages 34 and 35 of the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of this Annual Report on Form 10-K.   Fiscal Year Ended December 28, 2024   Specialty Health Care     Engineering     Life Sciences, Data & Solutions     Corporate     Total                                             Revenue   $ 142,679     $ 96,459     $ 39,242     $ -     $ 278,380                                             Cost of services     100,146       73,916       24,540       -       198,602                                             Gross profit     42,533       22,543       14,702       -       79,778                                             Selling, general and administrative     30,326       17,355       9,106       -       56,787                                             Depreciation and amortization of property and equipment     525       706       188       -       1,419                                             Amortization of acquired intangible assets     -       -       683       -       683                                             Potential stock issuance and financing transactions     -       -       -       323       323                                             Remeasurement of contingent consideration     -       -       (1,759 )     -       (1,759 )                                           Operating income   $ 11,682     $ 4,482     $ 6,484     $ (323 )   $ 22,325                                             Total assets as of December 28, 2024   $ 43,180     $ 52,160     $ 22,210     $ 14,527     $ 132,077   Property and equipment acquired   $ 296     $ 691     $ 28     $ 1,557     $ 2,572       Fiscal Year Ended December 30, 2023   Specialty Health Care     Engineering     Life Sciences, Data & Solutions     Corporate     Total                                             Revenue   $ 136,241     $ 84,675     $ 42,321     $ -     $ 263,237                                             Cost of services     96,309       64,071       26,161       -       186,541                                             Gross profit     39,932       20,604       16,160       -       76,696                                             Selling, general and administrative     26,010       16,964       9,211       -       52,185                                             Depreciation and amortization of property and equipment     383       504       145       -       1,032                                             Amortization of acquired intangible assets     -       -       182       -       182                                             Gain on sale of assets     -       (395 )     -       -       (395 )                                           Operating income (loss)   $ 13,539     $ 3,531     $ 6,622     $ -     $ 23,692                                             Total assets as of December 30, 2023   $ 43,769     $ 46,425     $ 18,586     $ 11,704     $ 120,484   Property and equipment acquired   $ 141     $ 724     $ 123     $ 1,943     $ 2,931       The Company derives a majority of its revenue from offices in the United States. Revenue reported for each operating segment are all from external customers. The Company is domiciled in the United States and its segments operate in the United States, Canada, Germany, Philippines, Puerto Rico and Europe. The Company does not derive any revenue in the Philippines. Revenue by geographic area for the fiscal years ended December 28, 2024 and December 30, 2023 are as follows:         Fiscal Year Ended       December 28,     December 30,       2024     2023   Revenue                 United States   $ 256,759     $ 246,578   Canada     7,196       6,480   Puerto Rico     7,017       6,515   Europe     7,408       3,664   Philippines     -       -       $ 278,380     $ 263,237       Total assets by geographic area as of the reported periods are as follows:       Fiscal Year Ended       December 28,     December 30,       2024     2023   Total Assets                 United States   $ 123,905     $ 110,781   Canada     1,423       1,880   Puerto Rico     3,286       3,476   Europe     3,408       4,347   Philippines     55       -       $ 132,077     $ 120,484

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Note 15 - Income Taxes	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Income Tax Disclosure [Text Block]	15.   INCOME TAXES   Generally, the Company’s relative income or loss generated in each of its jurisdictions can materially impact the consolidated effective income tax rate of the Company, particularly the ratio of Canadian and Serbian pretax income, versus United States pretax income. The consolidated effective income tax rate for fiscal years ended December 28, 2024 and December 30, 2023 were 34.0% and 24.2%, respectively.  The Company’s United States Federal statutory tax rate for fiscal years ended December 28, 2024 and December 30, 2023, before any adjustments, was 21.0%.  The income tax provisions reconciled to the tax computed at the United States Federal statutory rate for fiscal years 2024 and 2023 are as follows:       December 28, 2024     December 30, 2023       Amount     % of Earnings Before Taxes     Amount     % of Earnings Before Taxes   Tax expense on taxable income at federal statutory rate   $ 4,240       21.0     $ 4,661       21.0   State and Puerto Rico income taxes, net of Federal income tax benefit     1,164       5.8       1,082       4.9   Permanent differences domestic and foreign     188       0.9       (269 )     (1.2 ) Intangible asset deferred liability true-up     797       4.0       -       -   Foreign income tax rates     108       0.5       25       0.1   Foreign tax adjustment     174       0.9       -       -   Other     191       0.9       (135 )     (0.6 ) Total income tax expense   $ 6,863       34.0     $ 5,364       24.2         The components of income tax expense (benefit) are as follows:       Fiscal Years Ended       December 28, 2024     December 30, 2023   Current                 Federal   $ 2,609     $ 3,055   State and local     611       1,608   Foreign     942       660         4,162       5,323                     Deferred                 Federal     2,343       217   State     611       (143 ) Foreign     (253 )     (33 )       2,701       41   Total   $ 6,863     $ 5,364       The components of earnings before income taxes by United States and foreign jurisdictions were as follows:       Fiscal Years Ended       December 28, 2024     December 30, 2023   United States and Puerto Rico   $ 16,607     $ 19,333   Foreign jurisdictions     3,583       2,862       $ 20,190     $ 22,195       A reconciliation of the unrecognized tax benefits for the years December 28, 2024 and December 30, 2023:   Unrecognized Tax Benefits         Balance as of December 31, 2022   $ 1,196   Gross increases: tax positions in prior period     -   Gross increases: tax positions in current period     -   Balance as of December 30, 2023   $ 1,196   Gross increases: tax positions in prior period     -   Gross increases: tax positions in current period     -             Balance as of December 28, 2024   $ 1,196         The total amount of unrecognized tax benefits relating to the Company’s tax positions is subject to change based on future events including, but not limited to, the settlements of ongoing audits and/or the expiration of applicable statutes of limitations. Although the outcomes and timing of such events are highly uncertain, it is reasonably possible that the balance of gross unrecognized tax benefits will not change during the next 12 months. However, changes in the occurrence, expected outcomes and timing of those events could cause the Company’s current estimate to change materially in the future.   The Company accounts for penalties or interest related to uncertain tax positions as part of its provision for income taxes and records such amounts to tax expense.  The Company recorded no expense for penalties or interest in the fiscal years ended December 28, 2024 and December 30, 2023.   At December 28, 2024 and December 30, 2023, deferred tax assets and liabilities consist of the following:       December 28, 2024     December 30, 2023   Deferred tax assets:                 Provision for credit losses   $ 400     $ 421   Federal and state net operating loss carryforward     41       48   Compensation     836       747   Reserves, accruals, and other     461       760   Lease liability     1,304       777   Net operating loss carryforward, Germany     120       55   Total deferred tax assets     3,162       2,808                     Deferred tax liabilities:                 Intangible assets, net of amortization     (4,272 )     (1,860 ) Prepaid expense deferral     (1,146 )     (1,044 ) Fixed assets, net of depreciation     (906 )     (689 ) Right of use assets     (1,244 )     (728 ) Deferred tax liability, net, Canada     -       (187 ) Total deferred tax liabilities     (7,568 )     (4,508 ) Total deferred tax (liabilities) assets, net   $ (4,406 )   $ (1,700 )   The Company has gross state net operating losses of $0.6 million and foreign net operating losses of $0.4 million to be applied to the net income of future tax returns, respectively.  The state net operating losses are subject to various expiration periods.  The foreign net operating losses have an indefinite carryforward period.   The Company conducts its operations in multiple tax jurisdictions in the United States, Canada, Germany, Philippines, Puerto Rico and Serbia. The Company and its subsidiaries file a consolidated United States Federal income tax return and file in various states. The Company has no open Federal audits as of December 28, 2024. Except for limited exceptions, the Company is no longer subject to audits by state and local tax authorities for tax years prior to 2020. The Company is no longer subject to audit in Canada for the tax years prior to tax year 2020. The Company is under audit in Canada for tax years 2021 and 2022. The Company is no longer subject to audit in Puerto Rico for the tax years prior to tax year 2019.   Differences between the effective tax rate and the applicable U.S. federal statutory rate may arise, primarily from the effect of state and local income taxes, and share-based compensation. The actual 2024 effective tax rate may vary from the estimate depending on the actual operating income earned in various jurisdictions, and the exercise of stock options and vesting of share-based awards.     Under APB 23, foreign earnings are generally not subject to U.S. tax until repatriated or deemed repatriated under the anti-deferral rules.  The Company has determined that as of December 28, 2024, all current and future earnings in its foreign subsidiaries will be permanently reinvested.   Based on this determination, the anti-deferral rules have no material impact on the Company.

v3.25.0.1

Note 16 - Contingencies	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Contingencies Disclosure [Text Block]	16. CONTINGENCIES   From time to time, the Company is a defendant in various legal actions that arise in the ordinary business course.  These matters may relate to professional liability, tax, compensation, contract, competitor disputes, and employee-related matters and include individual and class action lawsuits, as well as inquiries and investigations by governmental agencies regarding the Company’s employment and compensation practices. Additionally, some of the Company’s clients may also become subject to claims, governmental inquiries and investigations, and legal actions relating to the Company’s professional services. Depending upon the particular facts and circumstances, the Company may also be subject to indemnification obligations under its contracts with such clients relating to these matters.   As such, the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of losses and possible recoveries.  The Company may not be covered by insurance as it pertains to some or all of these matters.  A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter.  The Company records a liability when management believes an adverse outcome from a loss contingency is both probable and the amount, or a range, can be reasonably estimated. From time to time, the Company must estimate the potential loss even though the party adverse to the Company has not asserted any specific amounts. Significant judgment is required to determine both the probability of loss and the estimated amount. The Company reviews its loss contingencies at least quarterly and it adjusts its accruals and/or disclosures to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, or other new information, as deemed necessary. Once established, a provision may change in the future due to new developments or changes in circumstances. The Company could increase or decrease its earnings in the period that the changes are made.    The Company is exposed to various asserted claims as of December 28, 2024, where the Company believes it has a probability of loss. Additionally, the Company is exposed to other asserted claims whereby an amount of loss has not been declared, and the Company cannot determine the potential loss. Any of these various claims could result in an unfavorable outcome or settlement that exceeds the accrued amounts. However, the Company believes that such matters will not, either individually or in the aggregate, have a material adverse effect on its business, consolidated financial position, results of operations, or cash flows. As of December 28, 2024, the Company has accrued $2.8 million for asserted claims.    In April 2022, a client of the Company’s Engineering segment alleged that a system partially designed by the Company is not operating as intended and that the Company is responsible. The Company has not determined if it has any liability. In the event of liability, the Company believes its damages are contractually limited to an amount no higher than $3.3 million. Furthermore, the Company believes that if it were found liable, any damages would be covered by insurance, subject to a deductible of $0.5 million and maximum coverage of $5.0 million. While the clients estimated damages are not known, the client has either inferred or asserted during settlement discussions that it’s damages significantly exceed the Company’s insurance coverage of $5 million. While the Company attempts to find a mutually agreeable solution, the Company has reserved $0.5 million for this project. The Company can give no assurance that its liability is limited to $3.3 million or that liability over $0.5 million, if any, will be covered by insurance.     The Company is also subject to other pending legal proceedings and claims that arise from time to time in the ordinary course of its business, which may not be covered by insurance.

v3.25.0.1

Note 17 - Retirement Plans	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Retirement Benefits [Text Block]	17.   RETIREMENT PLANS   Profit Sharing Plans   The Company maintains a 401(k) profit sharing plan for the benefit of eligible employees in the United States and other similar plans in Canada, Philippines, Puerto Rico and Serbia (the “Retirement Plans”). The 401(k) plan includes a cash or deferred arrangement pursuant to Section 401(k) of the Internal Revenue Code sponsored by the Company to provide eligible employees an opportunity to defer compensation and have such deferred amounts contributed to the 401(k) plan on a pre-tax basis, subject to certain limitations. The Company, at the discretion of the Board of Directors, may make contributions of cash to match deferrals of compensation by participants in the Retirement Plans. Contributions to the Retirement Plans charged to operations by the Company for the fiscal years ended December 28, 2024 and December 30, 2023 were $460 and $698, respectively.

v3.25.0.1

Note 18 - Commitments	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Commitments and Contingencies Disclosure [Text Block]	18.   COMMITMENTS   Leases   Leases are recorded in accordance with FASB ASC 842, Leases which requires lessees to recognize a right of use (“ROU”) asset and an operating right of use liability for all leases with terms greater than 12 months and requires disclosures by lessees and lessors about the amount, timing and uncertainty of cash flows arising from leases.   The Company determines if an arrangement is a lease at inception. For leases where the Company is the lessee, right of use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent an obligation to make lease payments arising from the lease. Right of use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit interest rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The right of use asset also consists of any lease incentives received. The lease terms used to calculate the right of use asset and related lease liability include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating leases is recognized on a straight-line basis over the lease term as an operating expense while the expense for finance leases is recognized as depreciation expense and interest expense using the accelerated interest method of recognition. The Company has lease agreements which require payments for lease and non-lease components. The Company has elected to account for these as a single lease component with the exception of its real estate leases.     Leases (Continued)   The components of lease expense were as follows:       Fiscal Years Ended       December 28, 2024     December 30, 2023   Operating lease cost   $ 1,356     $ 1,428                     Finance lease cost                 Amortization of right of use assets   $ 594     $ 484   Interest on lease liabilities     46       4   Total finance lease cost   $ 640     $ 488       Supplemental Cash Flow information related to leases was as follows:       December 28, 2024     December 30, 2023   Cash paid for amounts included in the measurement of lease liabilities                 Operating cash flows from operating leases   $ 1,214     $ 1,464   Operating cash flows from finance leases   $ 25     $ 5   Financing cash flows from finance leases   $ 595     $ 462                     Right of use assets obtained in exchange for lease obligations                 Operating leases   $ 3,407     $ 33   Finance leases   $ 2,172       -       Leases (Continued)   Supplemental Balance Sheet information as of December 28, 2024 and December 30, 2023 related to leases was as follows:       December 28, 2024     December 30, 2023   Operating leases                 Operating lease right of use assets   $ 5,174     $ 2,779                     Operating right of use liability - current   $ (1,046 )   $ (693 ) Operating right of use liability - non-current     (4,355 )     (2,268 ) Total operating lease liabilities   $ (5,401 )   $ (2,961 )                   Finance leases           Property and equipment - (right of use assets)   $ 2,172     $ 926   Accumulated depreciation     (362 )     (695 ) Property and equipment, net   $ 1,810     $ 231                     Finance lease liability - current   $ (698 )   $ (233 ) Finance lease liability - non-current     (1,112 )     -   Total finance lease liabilities   $ (1,810 )   $ (233 )                   Weighted average remaining lease term in years                 Operating leases     4.41       8.61   Finance leases     2.50       .50                     Weighted average discount rate                 Operating leases     6.36 %     3.15 % Finance leases     4.88 %     0.87 %       Leases (Continued)   Maturities of lease liabilities are as follows:     Fiscal Year   Operating Leases     Finance Leases   2025     1,300       773   2026     1,213       773   2027     1,017       387   2028     966       -   2029     650       -   Thereafter     1,168       -                     Total lease payments     6,314       1,933   Less: imputed interest     (913 )     (123 ) Total   $ 5,401     $ 1,810

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Note 19 - Related Party Transactions	12 Months Ended
	Dec. 28, 2024
Notes to Financial Statements
Related Party Transactions Disclosure [Text Block]	19.   RELATED PARTY TRANSACTIONS   There have been no related party transactions during the periods presented.

v3.25.0.1

Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 28, 2024
Accounting Policies [Abstract]
Basis of Accounting, Policy [Policy Text Block]	Description of Business and Basis of Presentation   RCM Technologies, Inc. (the “Company” or “RCM”) is a premier provider of business and technology solutions designed to enhance and maximize the operational performance of its customers through the adaptation and deployment of advanced engineering, life sciences, data and solutions. Additionally, the Company provides specialty healthcare staffing services through its Specialty Health Care Services group. RCM’s offices are primarily located in major metropolitan centers throughout North America, with additional offices in the Netherlands, Philippines, Serbia and Germany.   The consolidated financial statements are comprised of the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
Cash and Cash Equivalents, Policy [Policy Text Block]	Cash and Cash Equivalents   The Company considers its holdings of highly liquid money-market instruments and certificates of deposit to be cash equivalents if the securities mature within 90 days from the date of acquisition.  These investments are carried at cost, which approximates fair value.  The Company has significant cash balances at financial institutions, which, throughout the year, regularly exceed the federally insured limit of $250. Any loss incurred or lack of access to uninsured funds could have a significant adverse impact on the Company’s financial condition, results of operations and cash flows.   The Company held $269 and $103 of cash and cash equivalents in Canadian banks as of December 28, 2024 and December 30, 2023, respectively, which was held principally in Canadian dollars.  The Company held $496 and $638 of cash and cash equivalents in Serbian banks as of December 28, 2024 and December 30, 2023, respectively, which was held in various currencies. The Company held $556 of cash and cash equivalents in German banks as of December 28, 2024, which was held primarily in Euros. The office in Germany was opened in April 2023. The Company held $2 and $4 of cash and cash equivalents in Netherlands banks as of December 28, 2024 and December 30, 2023, respectively, which was held in various currencies.
Fair Value of Financial Instruments, Policy [Policy Text Block]	Fair Value of Financial Instruments   The Company’s carrying value of financial instruments, consisting primarily of accounts receivable, transit accounts receivable, accounts payable and accrued expenses, transit accounts payable and borrowings under line of credit approximates fair value due to their liquidity or their short-term nature and the line of credit’s variable interest rate. The Company does not have derivative products in place to manage risks related to foreign currency fluctuations for its foreign operations or for interest rate changes.
Receivable [Policy Text Block]	Accounts Receivable and Provision for Credit Losses   The Company’s accounts receivable are primarily due from trade customers.  Credit is extended based on evaluation of customers’ financial condition and, generally, collateral is not required.  Accounts receivable payment terms vary and are stated in the financial statements at amounts due from customers net of a provision for credit losses.  Accounts outstanding longer than the payment terms are considered past due.  The Company determines its provision by considering a number of factors, including the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole.  The Company writes off accounts receivable when they become uncollectible, and payments subsequently received on such receivables previously written off are credited to bad debt expense.
Unbilled Accounts Receivable And Work In Process [Policy Text Block]	Unbilled Accounts Receivable and Work-in-Process   Unbilled receivables primarily represent revenue earned whereby those services are ready to be billed as of the balance sheet ending date. Work-in-process primarily represents revenue earned under contracts which the Company is contractually precluded from invoicing until future dates as project milestones are realized. The Company follows Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers when recording revenue on unbilled accounts receivable and work-in-process. See Note 4 for further details.
Transit Receivable and Transit Payable [Policy Text Block]	Transit Accounts Receivable and Transit Accounts Payable   From time to time, the Company’s Engineering segment enters into agreements to provide, among other things, construction management and engineering services.  Pursuant to these agreements, the Company a) may purchase equipment on behalf of the Company’s customer or engage subcontractors to provide construction or other services; b) typically earns a fixed percentage of the total project value; and c) assumes no ownership or risks of inventory.  In such situations, the Company acts as an agent under the provisions of FASB ASC 606 “Revenue from Contracts with Customers” and therefore recognizes revenue on a “net-basis.”  The Company records revenue on a “net” basis on relevant engineering and construction management projects, which require subcontractor/procurement costs or transit costs. In those situations, the Company charges the client a negotiated fee, which is reported as net revenue when earned.    Under the terms of the agreements, the Company is typically not required to pay the subcontractor until after the corresponding payment from the Company’s end-client is received. Upon invoicing the end-client on behalf of the subcontractor or staffing agency, the Company records this amount simultaneously as both a “transit account receivable” and “transit account payable,” as the amount when paid to the Company is due to and generally paid to the subcontractor within a few days. The Company typically does not pay a given transit account payable until the related transit account receivable is collected. The Company is typically obligated to pay the subcontractor or staffing agency whether or not the client pays the Company. The Company’s transit accounts payable generally exceeds the Company’s transit accounts receivable but absolute amounts and spreads fluctuate significantly from quarter to quarter in the normal course of business.
Property, Plant and Equipment, Policy [Policy Text Block]	Property and Equipment   Property and equipment are stated at cost, less accumulated depreciation and amortization, and are depreciated or amortized on the straight-line method at rates calculated to provide for retirement of assets at the end of their estimated useful lives. Computer hardware and software, and furniture and office equipment are typically depreciated over five years. Leasehold improvements are amortized over the shorter of the estimated life of the asset or the lease term.
Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block]	Intangible Assets   The Company’s intangible assets have been generated through acquisitions. The Company maintains responsibility for valuing and determining the useful life of intangible assets. As a general rule, the Company amortizes restricted covenants over four years and customer relationships over six years. However, circumstances may dictate other amortization terms as determined by the Company and assisted by their third party advisors.
Canadian Sales Tax [Policy Text Block]	Canadian Sales Tax   The Company is required to charge and collect sales tax for all Canadian clients and remits invoiced sales tax monthly to the Canadian taxing authorities whether collected or not. The Company does not collect the sales tax from its clients until they have paid their respective invoices. The Company includes uncollected Canadian sales tax invoiced to clients in its prepaid and other current assets.
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block]	Goodwill   Goodwill is not amortized but is subject to periodic testing for impairment in accordance with FASB ASC 350 “Intangibles - Goodwill and Other.” The Company tests goodwill for impairment on an annual basis as of the last day of the Company’s fiscal December each year or more frequently if events occur or circumstances change indicating that the fair value of the goodwill may be below its carrying amount. The Company has three reporting units. The Company uses a market-based approach to determine the fair value of the reporting units. This approach uses earnings/revenue multiples of similar companies recently completing acquisitions and the ability of our reporting units to generate cash flows as measures of fair value of our reporting units.   The Company did not record a goodwill impairment charge in fiscal years ended December 28, 2024 and December 30, 2023. There can be no assurance that future indicators of impairment and tests of goodwill impairment will not result in an impairment charge.
Impairment or Disposal of Long-Lived Assets, Including Intangible Assets, Policy [Policy Text Block]	Long-Lived and Intangible Assets   The Company evaluates long-lived assets and intangible assets with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When the Company determines that it is probable that undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. Assets to be disposed of by sale, if any, are reported at the lower of the carrying amount or fair value less cost to sell. The Company’s intangible assets consist of customer relationships and non-compete agreements.
Research, Development, and Computer Software, Policy [Policy Text Block]	Software   In accordance with FASB ASC 350-40 “Accounting for Internal Use Software,” certain costs related to the development or purchase of internal-use software are capitalized and amortized over the estimated useful life of the software. During the fiscal years ended December 28, 2024 and December 30, 2023, the Company capitalized $4,141 and $1,947, respectively, for software costs. The net balance after accumulated depreciation for all software costs capitalized as of December 28, 2024 and December 30, 2023 was $5,622 and $2,325, respectively.
Income Tax, Policy [Policy Text Block]	Income Taxes   The Company makes judgments and interpretations based on enacted tax laws, published tax guidance, as well as estimates of future earnings. These judgments and interpretations affect the provision for income taxes, deferred tax assets and liabilities and the valuation allowance. The Company evaluated the deferred tax assets and determined on the basis of objective factors that the net assets will be realized through future years’ taxable income. In the event that actual results differ from these estimates and assessments, additional valuation allowances may be required. The Company did not have any valuation allowance as of December 28, 2024 and December 30, 2023.   The Company accounts for income taxes in accordance with FASB ACS 740 “Income Taxes” (FASB ASC 740) which requires an asset and liability approach of accounting for income taxes.  FASB ASC 740 requires assessment of the likelihood of realizing benefits associated with deferred tax assets for purposes of determining whether a valuation allowance is needed for such deferred tax assets.  Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that such tax rate changes are enacted. The Company measures its deferred tax assets and liabilities using the tax rates that the Company believes will apply in the years in which the temporary differences are expected to be recovered or paid. The Company and its wholly owned United States subsidiaries file a consolidated federal income tax return.  The Company also files tax returns in Canada, Germany, Philippines, Puerto Rico and Serbia.   The Company also follows the provisions of FASB ASC 740 which prescribes a model for the recognition and measurement of a tax position taken or expected to be taken in a tax return, and provides guidance on derecognition, classification, interest and penalties, disclosure and transition.  The Company’s policy is to record interest and penalty, if any, as interest expense.
Revenue from Contract with Customer [Policy Text Block]	Revenue Recognition   The Company records revenue under Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers. Revenue is recognized when we satisfy a performance obligation by transferring services promised in a contract to a customer, in an amount that reflects the consideration that we expect to receive in exchange for those services. Performance obligations in our contracts represent distinct or separate service streams that we provide to our customers.   We evaluate our revenue contracts with customers based on the five-step model under ASC 606: (1) Identify the contract with the customer; (2) Identify the performance obligations in the contract; (3) Determine the transaction price; (4) Allocate the transaction price to separate performance obligations; and (5) Recognize revenue when (or as) each performance obligation is satisfied.   The Company derives its revenue from several sources. The Company’s Engineering Services and Life Sciences, Data and Solutions segments perform consulting and project solution services. The Healthcare segment specializes in long-term and short-term staffing and placement services to hospitals, schools and long-term care facilities amongst others. All of the Company’s segments perform staff augmentation services and derive revenue from permanent placement fees.   The following table presents our revenue disaggregated by revenue source for the fiscal years ended December 28, 2024 and December 30, 2023:       December 28, 2024     December 30, 2023   Specialty Health Care:                 Time and Material   $ 141,185     $ 134,941   Permanent Placement Services     1,494       1,300   Total Specialty Health Care   $ 142,679     $ 136,241                     Engineering:                 Time and Material   $ 47,157     $ 42,443   Fixed Fee     49,302       42,232   Permanent Placement Services     -       -   Total Engineering   $ 96,459     $ 84,675                     Life Sciences, Data and Solutions:                 Time and Material   $ 30,547     $ 35,368   Fixed Fee     8,452       6,551   Permanent Placement Services     243       402   Total Life Sciences, Data and Solutions   $ 39,242     $ 42,321       $ 278,380     $ 263,237           Time and Material The Company’s Health Care segment predominantly recognizes revenue through time and material work while its Engineering and Life Sciences, Data and Solutions segments recognize revenue through both time and material and fixed fee work. The Company’s time and material contracts are typically based on the number of hours worked at contractually agreed upon rates, therefore revenue associated with these time and materials contracts are recognized based on hours worked at contracted rates.    Fixed Fee From time to time and predominantly in our Engineering segment, the Company enters into contracts requiring the completion of specific deliverables.  The Company has master services agreements with many of its customers that broadly define terms and conditions. Actual services performed under fixed fee arrangements are typically delivered under purchase orders that more specifically define terms and conditions related to that fixed fee project. While these master services agreements can often span several years, the Company’s fixed fee purchase orders are typically performed over six to nine month periods.  In instances where project services are provided on a fixed-price basis, revenue is recorded in accordance with the terms of each contract.  For engineering contracts estimated costs are budgeted by project, the Company then recognizes revenue by applying the costs incurred to date against the total budgeted costs and applying the percentage of completed cost against the total contract value to recognize revenue for each period.  In certain instances, revenue is invoiced at the time certain milestones are reached, as defined in the contract.  Revenue under these arrangements are recognized as the costs on these contracts are incurred.  From time-to-time, amounts paid in excess of revenue earned and recognized are recorded as deferred revenue.  Some contracts also limit revenue and billings to specified maximum amounts.  Provisions for contract losses, if any, are made in the period such losses are determined.  For contracts where there is a specific deliverable and the work is not complete and the revenue is not recognized, the costs incurred are deferred as a prepaid asset.  The associated costs are expensed when the related revenue is recognized.   Permanent Placement Services The Company earns permanent placement fees from providing permanent placement services. These fees are typically based on a percentage of the compensation paid to the person placed with the Company’s client. The Company guarantees its permanent placements on a prorated basis for 90 days. In the event a candidate is not retained for the 90-day period, the Company will provide a suitable replacement candidate. In the event a replacement candidate cannot be located, the Company will provide a prorated refund to the client. An allowance for refunds, based upon the Company’s historical experience, is recorded in the financial statements. Permanent placement revenue was $1.5 million and $1.7 million for the fiscal years ended December 28, 2024 and December 30, 2023, respectively.   The deferred revenue balance as of December 28, 2024 and December 30, 2023 was $4.2 million and $1.9 million, respectively. Revenue is recognized when the service has been performed.  Deferred revenue may be recognized over a period exceeding one year from the time it was recorded on the balance sheet, although this is an infrequent occurrence.  In fiscal years ended December 28, 2024 and December 30, 2023, the Company recognized revenue of $1.9 million and $1.1 million, respectively, that was included in deferred revenue at the beginning of the period.       Transit Receivables and Transit Payables From time to time, the Company’s Engineering segment enters into agreements to provide, among other things, construction management and engineering services.  Pursuant to these agreements, the Company a) may purchase equipment on behalf of the Company’s customer or engage subcontractors to provide construction or other services; b) typically earns a fixed percentage of the total project value; and c) assumes no ownership or risks of inventory.  Under the terms of the agreements, the Company is typically not required to pay the subcontractor until after the corresponding payment from the Company’s end-client is received. Upon invoicing the end-client on behalf of the subcontractor or staffing agency, the Company records this amount simultaneously as both a “transit account receivable” and “transit account payable,” as the amount when paid to the Company is due to and generally paid to the subcontractor within a few days. The Company typically does not pay a given transit account payable until the related transit account receivable is collected. The Company is typically obligated to pay the subcontractor or staffing agency whether or not the client pays the Company. The Company’s transit accounts payable generally exceeds the Company’s transit accounts receivable but absolute amounts and spreads fluctuate significantly from quarter to quarter in the normal course of business. The transit accounts receivable was $7.3 million and related transit accounts payable was $23.9 million, for a net payable of $16.6 million, as of December 28, 2024. The transit accounts receivable was $8.9 million and related transit accounts payable was $31.1 million, for a net payable of $22.2 million, as of December 30, 2023.
Concentration Risk, Credit Risk, Policy [Policy Text Block]	Concentrations   During the fiscal year ended December 28, 2024, the Company had two customers exceed 10% of consolidated revenue, representing 19.5% and 14.1% of consolidated revenue, respectively. During the fiscal year ended December 30, 2023, the Company had two customers exceed 10% of consolidated revenue, representing 17.1% and 10.1% of consolidated revenue, respectively. All customers exceeding 10% of consolidated revenue during the periods presented are included in the Company’s Specialty Health Care segment.   The Company’s five, ten and twenty largest customers accounted for approximately 48.5%, 60.1% and 70.6%, respectively, of the Company’s revenue for the fiscal year ended December 28, 2024. The Company’s five, ten and twenty largest customers accounted for approximately 39.1%, 50.4% and 62.7%, respectively, of the Company’s revenue for the fiscal year ended December 30, 2023.   As of December 28, 2024, three clients represented more than 10% of the Company's accounts receivable, net, representing 20.4% and 12.5% from the Company's two largest Specialty Health Care clients and 11.4% from the Company's largest Engineering client. As of December 30, 2023, two clients represented more than 10% of the Company's accounts receivable, net, representing 21.2% and 14.7% from the Company's two largest Specialty Health Care clients.
Foreign Currency Transactions and Translations Policy [Policy Text Block]	Foreign Currency Translation   The functional currency of the Company’s Canadian, Serbian and German subsidiaries is the local currency. Assets and liabilities are translated at period-end exchange rates. Income and expense items are translated at weighted average rates of exchange prevailing during the year. Any translation adjustments are included in the accumulated other comprehensive income account in stockholders’ equity. Transactions executed in different currencies resulting in exchange adjustments are translated at spot rates and resulting foreign exchange transaction gains and losses are included in the results of operations.
Comprehensive Income, Policy [Policy Text Block]	Comprehensive Income   Comprehensive income consists of net income and foreign currency translation adjustments.
Earnings Per Share, Policy [Policy Text Block]	Per Share Data   Basic net income per share is calculated using the weighted-average number of common shares outstanding during the period. Diluted net income per share is calculated using the weighted-average number of common shares plus dilutive potential common shares outstanding during the period. Potential dilutive common shares consist of stock options and other stock-based awards under the Company’s stock compensation plans, when their impact is dilutive. Because of the Company’s capital structure, all reported earnings pertain to common shareholders and no other adjustments are necessary.
Share-Based Payment Arrangement [Policy Text Block]	Share - Based Compensation   The Company recognizes share-based compensation over the vesting period of an award based on fair value at the grant date determined using the Black-Scholes option pricing model. Certain assumptions are used to determine the fair value of stock-based payment awards on the date of grant and require subjective judgment. Because employee stock options have characteristics significantly different from those of traded options, and because changes in the input assumptions can materially affect the fair value estimate, the existing models may not provide a reliable single measure of the fair value of the employee stock options. Management assesses the assumptions and methodologies used to calculate estimated fair value of stock-based compensation when share-based awards are granted. Circumstances may change and additional data may become available over time, which could result in changes to these assumptions and methodologies and thereby materially impact our fair value determination. If an employee leaves the firm before the vesting period has been met, those shares are forfeited and removed from the share – based compensation expense calculation. See Note 11 for additional share-based compensation information.   Restricted share and share unit awards are recognized at their fair value. The amount of compensation cost is measured on the grant date fair value of the equity instrument issued. The compensation cost of the restricted share and share unit awards is recognized over the vesting period of the restricted share and share unit awards on a straight-line basis. Restricted share and share unit awards typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period assuming the grantee’s restricted share or share unit award fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. Dividends for restricted share and share unit awards that ultimately do not vest are forfeited.
Advertising Cost [Policy Text Block]	Advertising Costs   Advertising costs are expensed as incurred. Total advertising expense was $719 and $781 for the fiscal years ended December 28, 2024 and December 30, 2023, respectively.
Fair Value Measurement, Policy [Policy Text Block]	Fair Value Measurements   The Company values its financial assets and liabilities based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.  In order to increase consistency and comparability in fair value measurements, a fair value hierarchy was established that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:   Level 1:  Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.  The fair value hierarchy gives the highest priority to Level 1 inputs.   Level 2:  Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in inactive markets; or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data.   Level 3:  Unobservable inputs are used when little or no market data is available.  The fair value hierarchy gives the lowest priority to Level 3 inputs.   In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value.

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Note 1 - Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Disaggregation of Revenue [Table Text Block]	December 28, 2024     December 30, 2023   Specialty Health Care:                 Time and Material   $ 141,185     $ 134,941   Permanent Placement Services     1,494       1,300   Total Specialty Health Care   $ 142,679     $ 136,241                     Engineering:                 Time and Material   $ 47,157     $ 42,443   Fixed Fee     49,302       42,232   Permanent Placement Services     -       -   Total Engineering   $ 96,459     $ 84,675                     Life Sciences, Data and Solutions:                 Time and Material   $ 30,547     $ 35,368   Fixed Fee     8,452       6,551   Permanent Placement Services     243       402   Total Life Sciences, Data and Solutions   $ 39,242     $ 42,321       $ 278,380     $ 263,237

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Note 4 - Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]	December 28, 2024     December 30, 2023   Billed   $ 55,224     $ 51,111   Unbilled     16,931       14,737   Work-in-progress     7,375       6,442   Provision for credit losses     (1,570 )     (1,600 )                   Accounts receivable, net   $ 77,960     $ 70,690

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Note 5 - Property and Equipment (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Property, Plant and Equipment [Table Text Block]	December 28, 2024     December 30, 2023   Computers and systems   $ 8,448     $ 5,512   Equipment and furniture     306       262   Leasehold improvements     590       413   Laboratory equipment     196       173         9,540       6,360                     Less: accumulated depreciation and amortization     2,172       2,355                     Property and equipment, net   $ 7,368     $ 4,005

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Note 6 - Acquisitions and Divestitures (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Schedule of Business Acquisitions by Acquisition, Contingent Consideration [Table Text Block]	Balance as of December 31, 2022   $ 2,442             Contingent payments - cash     (339 ) Contingent payments - stock     (132 )           Balance as of December 30, 2023   $ 1,971             Remeasurement of contingent consideration     (1,759 )           Balance as of December 28, 2024   $ 212       Total   Payable in fiscal 2025   $ 212

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Note 7 - Goodwill (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Schedule of Goodwill [Table Text Block]	Engineering     Specialty Health Care     Life Sciences, Data & Solutions     Total   Balance as of December 31, 2022   $ 11,918     $ 2,398     $ 7,831     $ 22,147                                     No change in fiscal 2023     -       -       -       -                                     Balance as of December 30, 2023   $ 11,918     $ 2,398     $ 7,831     $ 22,147                                     No change in fiscal 2024     -       -       -       -                                     Balance as of December 28, 2024   $ 11,918     $ 2,398     $ 7,831     $ 22,147

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Note 8 - Intangible Assets (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Schedule of Finite-Lived Intangible Assets [Table Text Block]	Engineering     Specialty Health Care     Life Sciences, Data & Solutions     Total   Balance as of December 31, 2022   $ -     $ -     $ 865     $ 865                                     Amortization in fiscal 2023     -       -       182       182                                     Balance as of December 30, 2023   $ -     $ -     $ 683     $ 683                                     Amortization in fiscal 2024     -       -       136       136   Impairment in fiscal 2024     -       -       547       547                                     Balance as of December 28, 2024   $ -     $ -     $ -     $ -

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Note 10 - Per Share Data (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Schedule of Weighted Average Number of Shares [Table Text Block]	Fiscal Years Ended       December 28, 2024     December 30, 2023   Basic weighted average shares outstanding     7,737,063       8,308,867   Dilutive effect of outstanding restricted share awards     202,318       283,705                     Diluted weighted average shares outstanding     7,939,381       8,592,572
Unissued Shares of Common Stock [Table Text Block]	December 28, 2024     December 30, 2023   Time-based restricted stock awards outstanding     289,421       376,618   Performance-based restricted stock awards outstanding     300,000       100,000   Future grants of options or shares     295,680       603,044   Shares reserved for employee stock purchase plan     252,119       297,730                     Total     1,137,220       1,377,392

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Note 11 - Share Based Compensation (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block]	Number of Time-Based Restricted Stock Awards     Weighted Average Grant Date Fair Value per Share   Outstanding non-vested at December 31, 2022     274,939     $ 3.59   Granted     293,978     $ 13.23   Vested     (181,197 )   $ 2.83   Forfeited or expired     (11,102 )   $ 2.23   Outstanding non-vested at December 30, 2023     376,618     $ 11.53   Granted     19,676     $ 22.62   Vested     (101,401 )   $ 10.32   Forfeited or expired     (5,472 )   $ 14.62   Outstanding non-vested at December 28, 2024     289,421     $ 12.65       Number of Performance- Based Restricted Stock Awards     Weighted Average Grant Date Fair Value per Share   Outstanding non-vested at December 31, 2022     225,000     $ 8.73   Granted     -       -   Vested     (125,000 )   $ 6.15   Forfeited or expired     -       -   Outstanding non-vested at December 30, 2023     100,000     $ 11.96   Granted     300,000     $ 28.79   Vested     (62,500 )   $ 11.96   Forfeited or expired     (37,500 )   $ 11.96   Outstanding non-vested at December 28, 2024     300,000     $ 28.79       Number of Restricted Stock Awards     Weighted Average Grant Date Fair Value per Share   Outstanding non-vested at December 31, 2022     499,939     $ 5.91   Granted – time-based vesting     293,978     $ 13.23   Granted – performance-based vesting     -       -   Vested     (306,197 )   $ 4.18   Forfeited or expired     (11,102 )   $ 2.23   Outstanding non-vested at December 30, 2023     476,618     $ 11.66   Granted – time-based vesting     19,676     $ 22.62   Granted – performance-based vesting     300,000     $ 28.79   Vested     (163,901 )   $ 10.94   Forfeited or expired     (42,972 )   $ 12.30   Outstanding non-vested at December 28, 2024     589,421     $ 20.86

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Note 14 - Segment Information (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Schedule of Segment Reporting Information, by Segment [Table Text Block]	Fiscal Year Ended December 28, 2024   Specialty Health Care     Engineering     Life Sciences, Data & Solutions     Corporate     Total                                             Revenue   $ 142,679     $ 96,459     $ 39,242     $ -     $ 278,380                                             Cost of services     100,146       73,916       24,540       -       198,602                                             Gross profit     42,533       22,543       14,702       -       79,778                                             Selling, general and administrative     30,326       17,355       9,106       -       56,787                                             Depreciation and amortization of property and equipment     525       706       188       -       1,419                                             Amortization of acquired intangible assets     -       -       683       -       683                                             Potential stock issuance and financing transactions     -       -       -       323       323                                             Remeasurement of contingent consideration     -       -       (1,759 )     -       (1,759 )                                           Operating income   $ 11,682     $ 4,482     $ 6,484     $ (323 )   $ 22,325                                             Total assets as of December 28, 2024   $ 43,180     $ 52,160     $ 22,210     $ 14,527     $ 132,077   Property and equipment acquired   $ 296     $ 691     $ 28     $ 1,557     $ 2,572   Fiscal Year Ended December 30, 2023   Specialty Health Care     Engineering     Life Sciences, Data & Solutions     Corporate     Total                                             Revenue   $ 136,241     $ 84,675     $ 42,321     $ -     $ 263,237                                             Cost of services     96,309       64,071       26,161       -       186,541                                             Gross profit     39,932       20,604       16,160       -       76,696                                             Selling, general and administrative     26,010       16,964       9,211       -       52,185                                             Depreciation and amortization of property and equipment     383       504       145       -       1,032                                             Amortization of acquired intangible assets     -       -       182       -       182                                             Gain on sale of assets     -       (395 )     -       -       (395 )                                           Operating income (loss)   $ 13,539     $ 3,531     $ 6,622     $ -     $ 23,692                                             Total assets as of December 30, 2023   $ 43,769     $ 46,425     $ 18,586     $ 11,704     $ 120,484   Property and equipment acquired   $ 141     $ 724     $ 123     $ 1,943     $ 2,931
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block]	Fiscal Year Ended       December 28,     December 30,       2024     2023   Revenue                 United States   $ 256,759     $ 246,578   Canada     7,196       6,480   Puerto Rico     7,017       6,515   Europe     7,408       3,664   Philippines     -       -       $ 278,380     $ 263,237
Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country [Table Text Block]	Fiscal Year Ended       December 28,     December 30,       2024     2023   Total Assets                 United States   $ 123,905     $ 110,781   Canada     1,423       1,880   Puerto Rico     3,286       3,476   Europe     3,408       4,347   Philippines     55       -       $ 132,077     $ 120,484

v3.25.0.1

Note 15 - Income Taxes (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]	December 28, 2024     December 30, 2023       Amount     % of Earnings Before Taxes     Amount     % of Earnings Before Taxes   Tax expense on taxable income at federal statutory rate   $ 4,240       21.0     $ 4,661       21.0   State and Puerto Rico income taxes, net of Federal income tax benefit     1,164       5.8       1,082       4.9   Permanent differences domestic and foreign     188       0.9       (269 )     (1.2 ) Intangible asset deferred liability true-up     797       4.0       -       -   Foreign income tax rates     108       0.5       25       0.1   Foreign tax adjustment     174       0.9       -       -   Other     191       0.9       (135 )     (0.6 ) Total income tax expense   $ 6,863       34.0     $ 5,364       24.2
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]	Fiscal Years Ended       December 28, 2024     December 30, 2023   Current                 Federal   $ 2,609     $ 3,055   State and local     611       1,608   Foreign     942       660         4,162       5,323                     Deferred                 Federal     2,343       217   State     611       (143 ) Foreign     (253 )     (33 )       2,701       41   Total   $ 6,863     $ 5,364       Fiscal Years Ended       December 28, 2024     December 30, 2023   United States and Puerto Rico   $ 16,607     $ 19,333   Foreign jurisdictions     3,583       2,862       $ 20,190     $ 22,195
Schedule of Unrecognized Tax Benefits Roll Forward [Table Text Block]	Unrecognized Tax Benefits         Balance as of December 31, 2022   $ 1,196   Gross increases: tax positions in prior period     -   Gross increases: tax positions in current period     -   Balance as of December 30, 2023   $ 1,196   Gross increases: tax positions in prior period     -   Gross increases: tax positions in current period     -             Balance as of December 28, 2024   $ 1,196
Schedule of Deferred Tax Assets and Liabilities [Table Text Block]	December 28, 2024     December 30, 2023   Deferred tax assets:                 Provision for credit losses   $ 400     $ 421   Federal and state net operating loss carryforward     41       48   Compensation     836       747   Reserves, accruals, and other     461       760   Lease liability     1,304       777   Net operating loss carryforward, Germany     120       55   Total deferred tax assets     3,162       2,808                     Deferred tax liabilities:                 Intangible assets, net of amortization     (4,272 )     (1,860 ) Prepaid expense deferral     (1,146 )     (1,044 ) Fixed assets, net of depreciation     (906 )     (689 ) Right of use assets     (1,244 )     (728 ) Deferred tax liability, net, Canada     -       (187 ) Total deferred tax liabilities     (7,568 )     (4,508 ) Total deferred tax (liabilities) assets, net   $ (4,406 )   $ (1,700 )

v3.25.0.1

Note 18 - Commitments (Tables)	12 Months Ended
	Dec. 28, 2024
Notes Tables
Lease, Cost [Table Text Block]	Fiscal Years Ended       December 28, 2024     December 30, 2023   Operating lease cost   $ 1,356     $ 1,428                     Finance lease cost                 Amortization of right of use assets   $ 594     $ 484   Interest on lease liabilities     46       4   Total finance lease cost   $ 640     $ 488
Lease, Cash Flow Information [Table Text Block]	December 28, 2024     December 30, 2023   Cash paid for amounts included in the measurement of lease liabilities                 Operating cash flows from operating leases   $ 1,214     $ 1,464   Operating cash flows from finance leases   $ 25     $ 5   Financing cash flows from finance leases   $ 595     $ 462                     Right of use assets obtained in exchange for lease obligations                 Operating leases   $ 3,407     $ 33   Finance leases   $ 2,172       -
Lease, Balance Sheet Information [Table Text Block]	December 28, 2024     December 30, 2023   Operating leases                 Operating lease right of use assets   $ 5,174     $ 2,779                     Operating right of use liability - current   $ (1,046 )   $ (693 ) Operating right of use liability - non-current     (4,355 )     (2,268 ) Total operating lease liabilities   $ (5,401 )   $ (2,961 )                   Finance leases           Property and equipment - (right of use assets)   $ 2,172     $ 926   Accumulated depreciation     (362 )     (695 ) Property and equipment, net   $ 1,810     $ 231                     Finance lease liability - current   $ (698 )   $ (233 ) Finance lease liability - non-current     (1,112 )     -   Total finance lease liabilities   $ (1,810 )   $ (233 )                   Weighted average remaining lease term in years                 Operating leases     4.41       8.61   Finance leases     2.50       .50                     Weighted average discount rate                 Operating leases     6.36 %     3.15 % Finance leases     4.88 %     0.87 %
Lease, Liability, Maturity [Table Text Block]	Fiscal Year   Operating Leases     Finance Leases   2025     1,300       773   2026     1,213       773   2027     1,017       387   2028     966       -   2029     650       -   Thereafter     1,168       -                     Total lease payments     6,314       1,933   Less: imputed interest     (913 )     (123 ) Total   $ 5,401     $ 1,810

v3.25.0.1

Note 1 - Summary of Significant Accounting Policies (Details Textual) $ in Thousands	12 Months Ended
	Dec. 28, 2024 USD ($)	Dec. 30, 2023 USD ($)
Cash and Cash Equivalents, at Carrying Value	$ 4,729	$ 6,284
Property, Plant and Equipment, Useful Life (Year)	5 years
Number of Reporting Units	3
Goodwill, Impairment Loss	$ 0	0
Capitalized Computer Software, Additions	4,141	1,947
Capitalized Computer Software, Net	5,622	2,325
Deferred Tax Assets, Valuation Allowance	0	0
Revenue from Contract with Customer, Including Assessed Tax	278,380	263,237
Contract with Customer, Liability	4,200	1,900
Contract with Customer, Liability, Revenue Recognized	1,900	1,100
Advertising Expense	$ 719	$ 781
Revenue, Segment Benchmark [Member] | Customer Concentration Risk [Member]
Number of Customers	2	2
Revenue, Segment Benchmark [Member] | Customer Concentration Risk [Member] | Customer 1 [Member]
Concentration Risk, Percentage	19.50%	17.10%
Revenue, Segment Benchmark [Member] | Customer Concentration Risk [Member] | Customer 2 [Member]
Concentration Risk, Percentage	14.10%	10.10%
Revenue, Segment Benchmark [Member] | Customer Concentration Risk [Member] | Ten Largest Customers [Member]
Number of Customers	10	10
Concentration Risk, Percentage	60.10%	50.40%
Revenue, Segment Benchmark [Member] | Customer Concentration Risk [Member] | Twenty Largest Customers [Member]
Number of Customers	20	20
Concentration Risk, Percentage	70.60%	62.70%
Revenue, Segment Benchmark [Member] | Customer Concentration Risk [Member] | Five Largest Customers [Member]
Number of Customers	5	5
Concentration Risk, Percentage	48.50%	39.10%
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer 1 [Member]
Concentration Risk, Percentage	20.40%	21.20%
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer 2 [Member]
Concentration Risk, Percentage	12.50%	14.70%
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Three Customers [Member]
Number of Customers	3
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer 3 [Member]
Concentration Risk, Percentage	11.40%
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Two Customers [Member]
Number of Customers		2
Transit Accounts Payable [Member]
Accounts Payable, Net		$ 22,200
Transit Accounts Receivable [Member]
Accounts Receivable, before Allowance for Credit Loss, Current	$ 7,300	8,900
Accounts Payable, Current	23,900	31,100
Accounts Payable, Net	16,600
Service, Other [Member]
Revenue from Contract with Customer, Including Assessed Tax	$ 1,500	1,700
Restricted Covenants [Member]
Finite-Lived Intangible Asset, Useful Life (Year)	4 years
Customer Relationships [Member]
Finite-Lived Intangible Asset, Useful Life (Year)	6 years
CANADA
Cash and Cash Equivalents, at Carrying Value	$ 269	103
Revenue from Contract with Customer, Including Assessed Tax	7,196	6,480
SERBIA
Cash and Cash Equivalents, at Carrying Value	496	638
GERMANY
Cash and Cash Equivalents, at Carrying Value	556
NETHERLANDS
Cash and Cash Equivalents, at Carrying Value	$ 2	$ 4

v3.25.0.1

Note 1 - Summary of Significant Accounting Policies - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Revenue	$ 278,380	$ 263,237
Health Care [Member]
Revenue	142,679	136,241
Health Care [Member] | Time-and-Materials Contract [Member]
Revenue	141,185	134,941
Health Care [Member] | Permanent Placement Services [Member]
Revenue	1,494	1,300
Engineering Services [Member]
Revenue	96,459	84,675
Engineering Services [Member] | Time-and-Materials Contract [Member]
Revenue	47,157	42,443
Engineering Services [Member] | Permanent Placement Services [Member]
Revenue	0	0
Engineering Services [Member] | Fixed-Price Contract [Member]
Revenue	49,302	42,232
Technology Service [Member]
Revenue	39,242	42,321
Technology Service [Member] | Time-and-Materials Contract [Member]
Revenue	30,547	35,368
Technology Service [Member] | Permanent Placement Services [Member]
Revenue	243	402
Technology Service [Member] | Fixed-Price Contract [Member]
Revenue	$ 8,452	$ 6,551

v3.25.0.1

Note 4 - Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable - Accounts Receivable (Details) - USD ($) $ in Thousands	Dec. 28, 2024	Dec. 30, 2023
Provision for credit losses	$ (1,570)	$ (1,600)
Accounts receivable, net	77,960	70,690
Billed Revenues [Member]
Accounts receivable, current	55,224	51,111
Unbilled Revenues [Member]
Accounts receivable, current	16,931	14,737
Work In Progress [Member]
Accounts receivable, current	$ 7,375	$ 6,442

v3.25.0.1

Note 5 - Property and Equipment (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Write Off of Fully Depreciated Property and Equipment	$ 1,604	$ 1,201
Depreciation, Nonproduction	$ 1,419	$ 1,032

v3.25.0.1

Note 5 - Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 28, 2024	Dec. 30, 2023
Property and equipment	$ 9,540	$ 6,360
Less: accumulated depreciation and amortization	2,172	2,355
Property and equipment, net	7,368	4,005
Computers and Systems [Member]
Property and equipment	8,448	5,512
Equipment and Furniture [Member]
Property and equipment	306	262
Leasehold Improvements [Member]
Property and equipment	590	413
Laboratory Equipment [Member]
Property and equipment	$ 196	$ 173

v3.25.0.1

Note 6 - Acquisitions and Divestitures (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Gain (Loss) on Disposition of Assets	$ (0)	$ 395
Engineering [Member] | Pickering and Kincardine Offices [Member]
Gain (Loss) on Disposition of Assets		$ 400
All Active Acquisitions {member]
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High	$ 200

v3.25.0.1

Note 6 - Acquisitions and Divestitures - Maximum Deferred Consideration Payments (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Balance	$ 1,971	$ 2,442
Contingent payments	0	(339)
Remeasurement of contingent consideration	1,759	(0)
Balance	212	1,971
Payable in fiscal 2025	$ 212
Cash [Member]
Contingent payments		(339)
Stock [Member]
Contingent payments		$ (132)

v3.25.0.1

Note 7 - Goodwill (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Goodwill, Impairment Loss	$ 0	$ 0

v3.25.0.1

Note 7 - Goodwill - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Balance	$ 22,147	$ 22,147
No change	0	0
Balance	22,147	22,147
Engineering [Member]
Balance	11,918	11,918
No change	0	0
Balance	11,918	11,918
Specialty Health Care [Member]
Balance	2,398	2,398
No change	0	0
Balance	2,398	2,398
Life Sciences, Data & Solutions [Member]
Balance	7,831	7,831
No change	0	0
Balance	$ 7,831	$ 7,831

v3.25.0.1

Note 8 - Intangible Assets - Intangible Assets by Class (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Balance	$ 683	$ 865
Amortization	136	182
Impairment	547	0
Balance	0	683
Engineering [Member]
Balance	0	0
Amortization	0	0
Impairment	0
Balance	0	0
Specialty Health Care [Member]
Balance	0	0
Amortization	0	0
Impairment	0
Balance	0	0
Life Sciences, Data & Solutions [Member]
Balance	683	865
Amortization	136	182
Impairment	547
Balance	$ 0	$ 683

v3.25.0.1

Note 9 - Line of Credit (Details Textual) - USD ($) $ in Thousands	Dec. 03, 2024	Dec. 28, 2024	Dec. 30, 2023	Oct. 18, 2019
Long-Term Line of Credit, Noncurrent		$ 34,967	$ 30,804
Citizens Bank of Pennsylvania [Member] | Revolving Credit Facility [Member]
Line of Credit Facility, Maximum Borrowing Capacity	$ 65,000			$ 45,000
Line of Credit Facility, Increase (Decrease), Net	$ 20,000
Debt Instrument, Interest Rate, Effective Percentage		6.60%	6.50%
Long-Term Line of Credit, Noncurrent		$ 35,000	$ 30,800
Letters of Credit Outstanding, Amount		7,400	2,000
Line of Credit Facility, Remaining Borrowing Capacity		$ 22,600	$ 12,100

v3.25.0.1

Note 10 - Per Share Data (Details Textual) - shares shares in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in shares)	0	0
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number (in shares)	0	0

v3.25.0.1

Note 10 - Per Share Data - Weighted Average Number of Common Shares (Details) - shares	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Basic weighted average shares outstanding (in shares)	7,737,063	8,308,867
Dilutive effect of outstanding restricted share awards (in shares)	202,318	283,705
Diluted weighted average shares outstanding (in shares)	7,939,381	8,592,572

v3.25.0.1

Note 10 - Per Share Data - Unissued Shares of Common Stock Were Reserved for the Following Purposes (Details) - shares	Dec. 28, 2024	Dec. 30, 2023
Future grants of options or shares (in shares)	295,680	603,044
Shares reserved for employee stock purchase plan (in shares)	252,119	297,730
Total (in shares)	1,137,220	1,377,392
Time-based Restricted Stock Units [Member]
Restricted stock units outstanding (in shares)	289,421	376,618
Performance-based Restricted Stock Units [Member]
Restricted stock units outstanding (in shares)	300,000	100,000

v3.25.0.1

Note 11 - Share Based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	Jan. 01, 2001	Dec. 28, 2024	Dec. 30, 2023	Dec. 31, 2022	Jan. 01, 2022	Jan. 02, 2021	Dec. 29, 2018	Dec. 31, 2016	Dec. 27, 2015	Dec. 27, 2024	Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)		10 years
Share-Based Payment Arrangement, Expense		$ 2,900	$ 2,100
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 8,000
Common Stock, Capital Shares Reserved for Future Issuance (in shares)		1,137,220	1,377,392
Dividends Payable		$ 0
Share Price (in dollars per share)		$ 23.17
Employee Stock Purchase Plan [Member]
Share-Based Payment Arrangement, Expense		$ 300	$ 300
Share-based Compensation Arrangement by Share-based Payment Award, Discount from Market Price, Offering Date	85.00%
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Employee Subscription Rate	10.00%
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Number of Shares Per Employee (in shares)	3,000
Additional Shares of Common Stock Reserved for Future Issuance (in shares)					400,000		300,000		300,000
Common Stock, Capital Shares Reserved for Future Issuance (in shares)					1,800,000		1,400,000		1,100,000
Stock Issued During Period, Shares, Employee Stock Purchase Plans (in shares)		45,611	66,501
Proceeds, Issuance of Shares, Share-Based Payment Arrangement, Including Option Exercised		$ 700	$ 700
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant (in shares)		252,119
The 2014 Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant (in shares)		295,680
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in shares)				2,975,000							625,000
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized (in shares)				1,000,000		850,000		500,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Outstanding		$ 12,500	13,800
Share Price (in dollars per share)										$ 23.17
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Nonvested		12,500
Performance-based Restricted Stock Units [Member]
Share-Based Payment Arrangement, Expense		$ 1,600	$ 700
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number (in shares)		300,000
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 5,400
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period (in shares)		300,000	0
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share)		$ 28.79	$ 0
Performance-based Restricted Stock Units [Member] | The 2014 Plan [Member]
Share-Based Payment Arrangement, Expense		$ 1,600	$ 700
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number (in shares)		300,000	100,000	225,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period (in shares)		300,000	0
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share)		$ 28.79	$ 0
Time-based Restricted Stock Units [Member]
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 2,600
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period (in shares)		19,676	293,978
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share)		$ 22.62	$ 13.23
Time-based Restricted Stock Units [Member] | Immediately Vested [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period (in shares)		0	4,762
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share)			$ 10.5
Time-based Restricted Stock Units [Member] | The 2014 Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number (in shares)		289,421	376,618	274,939
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 2,600
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Nonvested		$ 6,700
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period (in shares)		19,676	293,978
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share)		$ 22.62	$ 13.23
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)		1 year
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)		5 years

v3.25.0.1

Note 11 - Share Based Compensation - Restricted Stock Units Activity (Details) - $ / shares	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Time-based Restricted Stock Units [Member]
Granted (in shares)	19,676	293,978
Granted, weighted average grant date fair value (in dollars per share)	$ 22.62	$ 13.23
Time-based Restricted Stock Units [Member] | The 2014 Plan [Member]
Outstanding non-vested (in shares)	376,618	274,939
Outstanding non-vested, weighted average grant date fair value (in dollars per share)	$ 11.53	$ 3.59
Granted (in shares)	19,676	293,978
Granted, weighted average grant date fair value (in dollars per share)	$ 22.62	$ 13.23
Vested (in shares)	(101,401)	(181,197)
Vested, weighted average grant date fair value (in dollars per share)	$ 10.32	$ 2.83
Forfeited or expired (in shares)	(5,472)	(11,102)
Forfeited or expired, weighted average grant date fair value (in dollars per share)	$ 14.62	$ 2.23
Outstanding non-vested (in shares)	289,421	376,618
Outstanding non-vested, weighted average grant date fair value (in dollars per share)	$ 12.65	$ 11.53
Performance-based Restricted Stock Units [Member]
Granted (in shares)	300,000	0
Granted, weighted average grant date fair value (in dollars per share)	$ 28.79	$ 0
Outstanding non-vested (in shares)	300,000
Performance-based Restricted Stock Units [Member] | The 2014 Plan [Member]
Outstanding non-vested (in shares)	100,000	225,000
Outstanding non-vested, weighted average grant date fair value (in dollars per share)	$ 11.96	$ 8.73
Granted (in shares)	300,000	0
Granted, weighted average grant date fair value (in dollars per share)	$ 28.79	$ 0
Vested (in shares)	(62,500)	(125,000)
Vested, weighted average grant date fair value (in dollars per share)	$ 11.96	$ 6.15
Forfeited or expired (in shares)	(37,500)	0
Forfeited or expired, weighted average grant date fair value (in dollars per share)	$ 11.96	$ 0
Outstanding non-vested (in shares)	300,000	100,000
Outstanding non-vested, weighted average grant date fair value (in dollars per share)	$ 28.79	$ 11.96
Restricted Stock Units (RSUs) [Member]
Outstanding non-vested (in shares)	476,618	499,939
Outstanding non-vested, weighted average grant date fair value (in dollars per share)	$ 11.66	$ 5.91
Vested (in shares)	(163,901)	(306,197)
Vested, weighted average grant date fair value (in dollars per share)	$ 10.94	$ 4.18
Forfeited or expired (in shares)	(42,972)	(11,102)
Forfeited or expired, weighted average grant date fair value (in dollars per share)	$ 12.3	$ 2.23
Outstanding non-vested (in shares)	589,421	476,618
Outstanding non-vested, weighted average grant date fair value (in dollars per share)	$ 20.86	$ 11.66

v3.25.0.1

Note 12 - Treasury Stock and Retired Share Transactions (Details Textual) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	Apr. 24, 2023	Dec. 28, 2024	Dec. 30, 2023	Mar. 29, 2024
Treasury Stock, Shares, Acquired (in shares)	333,686	407,653	1,825,957
Shares Acquired, Average Cost Per Share (in dollars per share)	$ 11.91	$ 19.08	$ 14
Share Repurchase Program, Remaining Authorized, Amount		$ 42,200
Sales and Excise Tax Payable		$ 25
Maximum [Member]
Share Repurchase Program, Authorized, Amount				$ 50,000

v3.25.0.1

Note 14 - Segment Information (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Revenue from Contract with Customer, Including Assessed Tax	$ 278,380	$ 263,237
PHILIPPINES
Revenue from Contract with Customer, Including Assessed Tax	$ 0	$ 0

v3.25.0.1

Note 14 - Segment Information - Results of the Segments (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Revenues	$ 278,380	$ 263,237
Cost of services	198,602	186,541
Gross profit	79,778	76,696
Selling, general and administrative	56,787	52,185
Depreciation and amortization of property and equipment	1,419	1,032
Amortization of acquired intangible assets	683	182
Potential stock issuance and financing transactions	323	0
Remeasurement of contingent consideration	(1,759)	0
Operating income	22,325	23,692
Total assets	132,077	120,484
Property and equipment acquired	2,572	2,931
Gain on sale of assets	0	(395)
Specialty Health Care [Member]
Revenues	142,679	136,241
Cost of services	100,146	96,309
Gross profit	42,533	39,932
Selling, general and administrative	30,326	26,010
Depreciation and amortization of property and equipment	525	383
Amortization of acquired intangible assets	0	0
Potential stock issuance and financing transactions	0
Remeasurement of contingent consideration	0
Operating income	11,682	13,539
Total assets	43,180	43,769
Property and equipment acquired	296	141
Gain on sale of assets		0
Engineering [Member]
Revenues	96,459	84,675
Cost of services	73,916	64,071
Gross profit	22,543	20,604
Selling, general and administrative	17,355	16,964
Depreciation and amortization of property and equipment	706	504
Amortization of acquired intangible assets	0	0
Potential stock issuance and financing transactions	0
Remeasurement of contingent consideration	0
Operating income	4,482	3,531
Total assets	52,160	46,425
Property and equipment acquired	691	724
Gain on sale of assets		(395)
Life Sciences, Data & Solutions [Member]
Revenues	39,242	42,321
Cost of services	24,540	26,161
Gross profit	14,702	16,160
Selling, general and administrative	9,106	9,211
Depreciation and amortization of property and equipment	188	145
Amortization of acquired intangible assets	683	182
Potential stock issuance and financing transactions	0
Remeasurement of contingent consideration	(1,759)
Operating income	6,484	6,622
Total assets	22,210	18,586
Property and equipment acquired	28	123
Gain on sale of assets		0
Corporate Segment [Member]
Revenues	0	0
Cost of services	0	0
Gross profit	0	0
Selling, general and administrative	0	0
Depreciation and amortization of property and equipment	0	0
Amortization of acquired intangible assets	0	0
Potential stock issuance and financing transactions	323
Remeasurement of contingent consideration	0
Operating income	(323)	0
Total assets	14,527	11,704
Property and equipment acquired	$ 1,557	1,943
Gain on sale of assets		$ 0

v3.25.0.1

Note 14 - Segment Information - Revenues by Geographic Area (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Revenue	$ 278,380	$ 263,237
UNITED STATES
Revenue	256,759	246,578
CANADA
Revenue	7,196	6,480
PUERTO RICO
Revenue	7,017	6,515
Europe [Member]
Revenue	7,408	3,664
PHILIPPINES
Revenue	$ 0	$ 0

v3.25.0.1

Note 14 - Segment Information - Total Assets by Geographic Area (Details) - USD ($) $ in Thousands	Dec. 28, 2024	Dec. 30, 2023
Total assets	$ 132,077	$ 120,484
UNITED STATES
Total assets	123,905	110,781
CANADA
Total assets	1,423	1,880
PUERTO RICO
Total assets	3,286	3,476
Europe [Member]
Total assets	3,408	4,347
PHILIPPINES
Total assets	$ 55,000	$ 0

v3.25.0.1

Note 15 - Income Taxes (Details Textual) - USD ($) $ in Millions	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Effective Income Tax Rate Reconciliation, Percent	34.00%	24.20%
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	21.00%	21.00%
State and Local Jurisdiction [Member]
Operating Loss Carryforwards	$ 0.6
Open Tax Year	2021 2022 2023 2024
Foreign Tax Jurisdiction [Member]
Operating Loss Carryforwards	$ 0.4
Foreign Tax Jurisdiction [Member] | Canada Revenue Agency [Member]
Open Tax Year	2021 2022
Foreign Tax Jurisdiction [Member] | Puerto Rico Department of Treasury [Member]
Open Tax Year	2020 2021 2022 2023 2024

v3.25.0.1

Note 15 - Income Taxes - Income Tax Provision Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Tax expense on taxable income at federal statutory rate	$ 4,240	$ 4,661
Tax expense on taxable income at federal statutory rate, percent	21.00%	21.00%
State and Puerto Rico income taxes, net of Federal income tax benefit	$ 1,164	$ 1,082
State and Puerto Rico income taxes, net of Federal income tax benefit, percent	5.80%	4.90%
Permanent differences domestic and foreign	$ 188	$ (269)
Permanent differences domestic and foreign, percent	0.90%	(1.20%)
Intangible asset deferred liability true-up	$ 797	$ 0
Intangible asset deferred liability true-up, percent	4.00%	0.00%
Foreign income tax rates	$ 108	$ 25
Foreign income tax rates, percent	0.50%	0.10%
Foreign tax adjustment	$ 174	$ 0
Foreign tax adjustment, percent	0.90%	0.00%
Other	$ 191	$ (135)
Other, percent	0.90%	(0.60%)
Total income tax expense	$ 6,863	$ 5,364
Total income tax expense, percent	34.00%	24.20%

v3.25.0.1

Note 15 - Income Taxes - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Federal	$ 2,609	$ 3,055
State and local	611	1,608
Foreign	942	660
Current Income Tax Expense (Benefit)	4,162	5,323
Deferred federal	2,343	217
Deferred state	611	(143)
Deferred foreign	(253)	(33)
Deferred Income Tax Expense (Benefit)	2,701	41
Total income tax expense	6,863	5,364
United States and Puerto Rico	16,607	19,333
Foreign jurisdictions	3,583	2,862
Income before income taxes	$ 20,190	$ 22,195

v3.25.0.1

Note 15 - Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Balance	$ 1,196	$ 1,196
Gross increases: tax positions in prior period	0	0
Gross increases: tax positions in current period	0	0
Balance	$ 1,196	$ 1,196

v3.25.0.1

Note 15 - Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 28, 2024	Dec. 30, 2023
Deferred tax assets:
Provision for credit losses	$ 400	$ 421
Federal and state net operating loss carryforward	41	48
Compensation	836	747
Reserves, accruals, and other	461	760
Lease liability	1,304	777
Net operating loss carryforward, Germany	120	55
Total deferred tax assets	3,162	2,808
Deferred tax liabilities:
Intangible assets, net of amortization	(4,272)	(1,860)
Prepaid expense deferral	(1,146)	(1,044)
Fixed assets, net of depreciation	(906)	(689)
Right of use assets	(1,244)	(728)
Deferred tax liability, net, Canada	0	(187)
Total deferred tax liabilities	(7,568)	(4,508)
Total deferred tax liabilities, net	$ (4,406)	$ (1,700)

v3.25.0.1

Note 16 - Contingencies (Details Textual) - USD ($) $ in Millions		1 Months Ended
	Apr. 30, 2022	Apr. 30, 2022	Dec. 28, 2024
Estimated Litigation Liability			$ 2.8
System Partially Designed Not Operating As Intended [Member]
Estimated Litigation Liability	$ 0.5	$ 0.5
Loss Contingency, Estimated Maximum Damages, Value		3.3
Litigation Insurance Deductible	0.5	0.5
Litigation Insurance, Maximum Coverage	5.0	$ 5.0
System Partially Designed Not Operating As Intended [Member] | Minimum [Member]
Loss Contingency, Damages Sought, Value	$ 5.0

v3.25.0.1

Note 17 - Retirement Plans (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Deferred Compensation Arrangement with Individual, Contributions by Employer	$ 460	$ 698

v3.25.0.1

Note 18 - Commitments - Lease Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Operating lease cost	$ 1,356	$ 1,428
Amortization of right of use assets	594	484
Finance lease cost, Interest on lease liabilities	46	4
Total finance lease cost	$ 640	$ 488

v3.25.0.1

Note 18 - Commitments - Cash Flow Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Operating cash flows from operating leases	$ 1,214	$ 1,464
Operating cash flows from finance leases	25	5
Financing cash flows from finance leases	595	462
Right of use assets obtained in exchange for lease obligations	3,407	33
Finance leases	$ 2,172	$ 0

v3.25.0.1

Note 18 - Commitments - Balance Sheet Information (Details) - USD ($) $ in Thousands	Dec. 28, 2024	Dec. 30, 2023
Operating lease right of use assets	$ 5,174	$ 2,779
Operating right of use liability - current	(1,046)	(693)
Operating right of use liability - non-current	(4,355)	(2,268)
Total operating lease liabilities	(5,401)	(2,961)
Property and equipment - (right of use assets)	2,172	926
Accumulated depreciation	(362)	(695)
Property and equipment, net	1,810	231
Finance lease liability - current	(698)	(233)
Finance lease liability - non-current	(1,112)	0
Total finance lease liabilities	$ (1,810)	$ (233)
Operating leases (Year)	4 years 4 months 28 days	8 years 7 months 9 days
Finance leases (Year)	2 years 6 months	6 months
Operating leases	6.36%	3.15%
Finance leases	4.88%	0.87%

v3.25.0.1

Note 18 - Commitments - Balance Sheet Information (Details) (Parentheticals)	Dec. 28, 2024	Dec. 30, 2023
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration]	Property, Plant and Equipment, Net	Property, Plant and Equipment, Net

v3.25.0.1

Note 18 - Commitments - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands	Dec. 28, 2024	Dec. 30, 2023
2025, operating leases	$ 1,300
2025, finance leases	773
2026, operating leases	1,213
2026, finance leases	773
2027, operating leases	1,017
2027, finance leases	387
2028, operating leases	966
2028, finance leases	0
2029, operating leases	650
2029, finance leases	0
Thereafter, operating leases	1,168
Thereafter, finance leases	0
Total lease payments, operating leases	6,314
Total lease payments, finance leases	1,933
Less: imputed interest, operating leases	(913)
Less: imputed interest, finance leases	(123)
Total, operating leases	5,401	$ 2,961
Total, finance leases	$ 1,810	$ 233

v3.25.0.1

Note 19 - Related Party Transactions (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 28, 2024	Dec. 30, 2023
Related Party Transaction, Amounts of Transaction	$ 0	$ 0

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