Delaware
|
38-2774613
|
|
(State
or other jurisdiction of incorporation)
|
(I.R.S.
Employer Identification No.)
|
Title of Each Class
|
Name of each exchange on which
registered
|
|
Common
Stock, $.01 par value
|
NASDAQ®
Global Market
|
Page
Number
|
||||
PART
I
|
||||
Item
1
|
Business
|
3
|
||
Item
1A
|
Risk
Factors
|
11
|
||
Item
1B
|
Unresolved
Staff Comments
|
21
|
||
Item
2
|
Properties
|
22
|
||
Item
3
|
Legal
Proceedings
|
22
|
||
Item
4
|
(Reserved)
|
|||
PART
II
|
||||
Item
5
|
Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
|
23
|
||
Item
6
|
Selected
Financial Data
|
25
|
||
Item
7
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
27
|
||
Item
7A
|
Quantitative
and Qualitative Disclosures about Market Risk
|
45
|
||
Item
8
|
Financial
Statements and Supplementary Data
|
46
|
||
Item
9
|
Changes
In and Disagreements with Accountants on Accounting and Financial
Disclosure
|
85
|
||
Item
9A
|
Controls
and Procedures
|
85
|
||
Item
9B
|
Other
Information
|
85
|
||
PART
III
|
||||
Item
10
|
Directors,
Executive Officers and Corporate Governance
|
86
|
||
Item
11
|
Executive
Compensation
|
86
|
||
Item
12
|
Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
|
87
|
||
Item
13
|
Certain
Relationships and Related Transactions, and Director
Independence
|
87
|
||
Item
14
|
Principal
Accountant Fees and Services
|
88
|
||
PART
IV
|
||||
Item
15
|
Exhibits
and Financial Statement Schedules
|
89
|
||
SIGNATURES
|
93
|
|||
FINANCIAL
STATEMENT SCHEDULE
|
95
|
Item
1.
|
BUSINESS
|
Item
1A.
|
RISK
FACTORS
|
|
·
|
changes
in a country’s or region’s economic or political conditions, including
inflation, recession, interest rate fluctuations, terrorism and religious
extremism and unanticipated military
conflicts;
|
|
·
|
currency
fluctuations, particularly in the European euro, which contribute to
variations in the sale of services in impacted jurisdictions and also
affect our reported results expressed in U.S.
dollars;
|
|
·
|
longer
accounts receivable cycles and financial instability among
customers;
|
|
·
|
local
labor conditions and regulations;
|
|
·
|
differences
in cultures and languages, which can impair our ability to work as an
effective global team;
|
|
·
|
differing
political and social systems;
|
|
·
|
changes
in the regulatory or legal
environment;
|
|
·
|
differing
technology standards or customer
requirements;
|
|
·
|
difficulties
associated with repatriating cash generated or held abroad in a
tax-efficient manner;
|
|
·
|
changes
in tax laws in international jurisdictions;
and
|
|
·
|
natural
and man-made disasters.
|
|
·
|
the
depth and liquidity of the trading market for our common
stock;
|
|
·
|
general
economic conditions;
|
|
·
|
developments
in the industries or markets in which we
operate;
|
|
·
|
acquisitions
and divestitures;
|
|
·
|
announcements
by competitors;
|
|
·
|
actual
or anticipated variations in quarterly or annual operating
results;
|
|
·
|
speculation
in the press or investment
community;
|
|
·
|
sales
of large blocks of our common stock or sales of our common stock by
insiders;
|
|
·
|
any
dilutive effect from stock
offerings;
|
|
·
|
changes
in accounting standards, policies, guidance, interpretations or
principles;
|
|
·
|
regulatory
actions or litigation; and
|
|
·
|
departures
of our key personnel.
|
Item
1B.
|
UNRESOLVED
STAFF COMMENTS
|
Location
|
Function
|
Lease Term Beginning
and End (mm/dd/yr)
|
Square
Footage
|
|||||
Southfield,
MI
|
World
Headquarters and Service Desk Facility
|
11/01/93
– 08/31/16
|
73,622 | |||||
Brussels,
Belgium
|
European
Headquarters and Service Desk Facility
|
08/01/97
– 06/30/18
|
32,842 | |||||
Bucharest,
Romania
|
Service
Desk Facility
|
09/01/04
– 05/13/15
|
30,140 | |||||
Ann
Arbor, MI
|
Sales
and Administrative Office
|
05/31/07
– 03/31/13
|
17,766 | |||||
Chantilly,
VA
|
Headquarters
of TechTeam Government Solutions, Inc.
|
06/12/04
– 05/31/11
|
17,957 | |||||
Davenport,
IA
|
Service
Desk Facility
|
10/15/99
– 08/31/14
|
18,339 | |||||
Bucharest,
Romania
|
Headquarters
of TechTeam Akela SRL
|
10/01/06
– 06/30/14
|
10,065 | |||||
Stockholm,
Sweden
|
Headquarters
of TechTeam SQM AB
|
02/14/07
– 12/31/13
|
6,598 | |||||
Dresden,
Germany
|
Service
Desk Facility
|
04/01/08
– 07/31/16
|
5,748 | |||||
Bethesda,
MD
|
Sales
and Administrative Office
|
06/01/01
– 10/31/13
|
5,428 | |||||
Alexandria,
VA
|
Sales
and Administrative Office
|
05/31/07
– 05/30/11
|
5,258 | |||||
Portsmouth,
RI
|
Sales
and Administrative Office
|
06/01/01
– 05/31/12
|
4,200 | |||||
Sibiu,
Romania
|
Service
Desk Facility
|
03/07/08
– 03/17/11
|
3,659 | |||||
Alexandria,
VA
|
Sales
and Administrative Office
|
04/01/08
– 03/31/13
|
3,142 | |||||
San
Diego, CA
|
Sales
and Administrative Office
|
05/31/07
– 04/30/13
|
2,350 | |||||
Galati,
Romania
|
Sales
and Administrative Office
|
05/01/07
– 09/30/10
|
861 | |||||
Manila,
Philippines
|
Service
Desk Facility
|
05/01/08
– 11/30/10
|
3,003 |
Item
3.
|
LEGAL
PROCEEDINGS
|
Item
5.
|
MARKET
FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
|
Year and Quarter
|
High
|
Low
|
||||||
2009
|
||||||||
First
Quarter
|
$ | 6.45 | $ | 3.50 | ||||
Second
Quarter
|
7.10 | 4.44 | ||||||
Third
Quarter
|
9.79 | 5.41 | ||||||
Fourth
Quarter
|
8.47 | 6.40 | ||||||
2008
|
||||||||
First
Quarter
|
$ | 12.60 | $ | 7.80 | ||||
Second
Quarter
|
10.85 | 8.45 | ||||||
Third
Quarter
|
10.65 | 7.15 | ||||||
Fourth
Quarter
|
7.31 | 3.34 |
Total Return Index
|
||||||||||||||||||||||||
Dec 2004
|
Dec 2005
|
Dec 2006
|
Dec 2007
|
Dec 2008
|
Dec 2009
|
|||||||||||||||||||
NASDAQ
U.S.
|
$ | 100 | $ | 102 | $ | 112 | $ | 122 | $ | 59 | $ | 85 | ||||||||||||
NASDAQ
Computer
|
$ | 100 | $ | 103 | $ | 116 | $ | 142 | $ | 82 | $ | 133 | ||||||||||||
TechTeam
Global
|
$ | 100 | $ | 99 | $ | 111 | $ | 124 | $ | 58 | $ | 75 |
Item
6.
|
SELECTED
FINANCIAL DATA
|
Year Ended December 31,
|
||||||||||||||||||||
Statements of Operations Data
|
2009
|
2008
|
2007
|
2006
|
2005
|
|||||||||||||||
(In
thousands, except per share data)
|
||||||||||||||||||||
Revenue
|
||||||||||||||||||||
Commercial
|
||||||||||||||||||||
IT
Outsourcing Services
|
$ | 106,229 | $ | 120,166 | $ | 104,659 | $ | 86,461 | $ | 76,845 | ||||||||||
IT
Consulting and Systems Integration
|
12,755 | 27,064 | 28,064 | 24,013 | 24,483 | |||||||||||||||
Other
Services
|
15,817 | 24,110 | 20,219 | 9,497 | 9,010 | |||||||||||||||
Total
Commercial
|
134,801 | 171,340 | (b) | 152,942 | (d) | 119,971 | 110,338 | (f) | ||||||||||||
Government
Technology Services
|
76,440 | 88,615 | 69,254 | (e) | 47,393 | 56,159 | (g) | |||||||||||||
Total
revenue
|
$ | 211,241 | $ | 259,955 | $ | 222,196 | $ | 167,364 | $ | 166,497 | ||||||||||
Impairment
charges
|
$ | 27,453 | (a) | $ | — | $ | — | $ | — | $ | — | |||||||||
Restructuring
charges, net
|
411 | 5,719 | (c) | — | — | — | ||||||||||||||
(Loss)
income before income taxes
|
(21,894 | ) | 7,150 | 9,639 | 2,750 | (h) | 7,796 | |||||||||||||
Income
tax (benefit) provision
|
(3,261 | ) | 4,182 | 3,343 | 873 | 2,402 | ||||||||||||||
(Loss)
income from continuing operations
|
(18,633 | ) | 2,968 | 6,296 | 1,877 | 5,394 | ||||||||||||||
(Loss)
income from discontinued operations
|
— | — | — | (43 | ) | 74 | ||||||||||||||
Net
(loss) income
|
$ | (18,633 | ) | $ | 2,968 | $ | 6,296 | $ | 1,834 | $ | 5,468 | |||||||||
Diluted
earnings (loss) per common share
|
||||||||||||||||||||
Income
(loss) from continuing operations
|
$ | (1.75 | ) | $ | 0.28 | $ | 0.60 | $ | 0.18 | $ | 0.54 | |||||||||
Income
(loss) from discontinued operations
|
— | — | — | — | 0.01 | |||||||||||||||
Net
income (loss) per share
|
$ | (1.75 | ) | $ | 0.28 | $ | 0.60 | $ | 0.18 | $ | 0.54 | |||||||||
Weighted
average common shares and common
share equivalents outstanding
|
10,618 | 10,555 | 10,506 | 10,176 | (i) | 9,832 | (i) | |||||||||||||
Weighted
average preferred shares outstanding
|
— | — | — | — | (i) | 244 | (i) |
|
(a)
|
As
part of the Company’s annual impairment test it was determined that the
goodwill for Government Solutions and SQM reporting units were impaired.
The Company also recorded an impairment charge for certain intangible
assets at these reporting units.
|
(b)
|
On
May 30, 2008, the Company acquired 100% of the outstanding stock of Onvaio
LLC. On October 31, 2008, the Company completed the sale of TechTeam A.N.E
NV/SA, the results of which were included in continuing operations through
the date of the sale.
|
|
(c)
|
On
May 28, 2008 and December 30, 2008, the Company announced corporate-wide
restructuring actions.
|
(d)
|
On
February 9, 2007, the Company acquired 100% of the outstanding stock
of SQM Sverige AB.
|
|
(e)
|
On
May 31, 2007, the Company acquired 100% of the membership interest in
NewVectors LLC, and on August 31, 2007, we acquired 100% of the
outstanding stock of RL Phillips,
Inc.
|
|
(f)
|
On
October 3, 2005, the Company acquired 100% of the outstanding stock
of Akela Informatique SRL.
|
(g)
|
On
January 3, 2005, the Company acquired 100% of the outstanding stock
of Sytel, Inc.
|
(h)
|
During
2006, the Company recorded expenses totaling $1.4 million for legal and
professional fees associated with a proxy contest initiated by a
shareholder, an asset impairment charge of $580,000 related to a software
asset and $650,000 for the settlement of claims against the Company by
certain former Company officers.
|
|
(i)
|
In
May 2005, the holder of our preferred stock converted all of the preferred
shares into 689,656 shares of common
stock.
|
As of December 31,
|
||||||||||||||||||||
Balance Sheet Data
|
2009(a)
|
2008 (b)
|
2007 (c)
|
2006
|
2005 (d)
|
|||||||||||||||
(In
thousands)
|
||||||||||||||||||||
Total
assets
|
$ | 122,520 | $ | 167,363 | $ | 182,169 | $ | 117,930 | $ | 123,010 | ||||||||||
Long-term
obligations
|
11,796 | 30,156 | 33,963 | 5,426 | 14,115 | |||||||||||||||
Total
shareholders’ equity
|
$ | 83,629 | $ | 98,733 | $ | 97,031 | $ | 86,308 | $ | 78,240 | (e) |
|
(a)
|
As
part of the Company’s annual impairment test it was determined that the
goodwill for Government Solutions and SQM reporting units was impaired.
The Company also recorded an impairment charge for certain intangibles
assets at these reporting units.
|
(b)
|
On
May 30, 2008, we acquired 100% of the outstanding stock of Onvaio LLC. On
October 31, 2008, the Company completed the sale of TechTeam A.N.E
NV/SA.
|
|
(c)
|
On
February 9, 2007, we acquired 100% of the outstanding stock of SQM
Sverige AB. On May 31, 2007, we acquired 100% of the membership
interest in NewVectors LLC. On August 31, 2007, we acquired 100% of
the outstanding stock of RL Phillips,
Inc.
|
(d)
|
On
October 3, 2005, we acquired 100% of the outstanding stock of Akela
Informatique SRL. On January 3, 2005, we acquired 100% of the
outstanding stock of Sytel, Inc.
|
|
(e)
|
In
May 2005, the holder of our preferred stock converted all outstanding
shares of preferred stock into 689,656 shares of common
stock.
|
Item
7.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(“MD&A”)
|
|
·
|
As
a result of the difficult economy, conditions in the markets we serve and
our customer’s reactions to their financial circumstances, we experienced
significant price, volume and account erosion. Our revenues declined by
$48.7 million or 18.7% from 2008, across all of our business segments and
regions. In the third quarter and fourth quarter of 2009, contracts to
provide services to certain customers ended, steepening the revenue
decline. While we have launched significant new business to off-set some
of this revenue decline, the revenue decline will likely affect the
Company’s results in the first half of
2010.
|
|
·
|
During
2009, our gross margins improved to 23.9% from 23.2%. In spite of revenue
declines during the period, we responded to the need to adjust our service
delivery cost structure to meet the needs of our
business.
|
|
·
|
However,
as a result of poor economic conditions and staffing contract losses in
Sweden, we anticipate reductions in expected future cash flows from our
2007 acquisition of TechTeam SQM AB. In addition, the insourcing of the
Air National Guard contract by the U.S. Federal Government and reduced
demand for certain other contracts at our TechTeam Government Solutions,
Inc subsidiary will also reduce our expected future cash flows. Based upon
these reductions in anticipated cash flow, we have concluded that goodwill
was impaired in our Government Solutions and SQM reporting units.
Accordingly, we recorded a $20.8 million and $4.4 million pretax
impairment charge in the fourth quarter of 2009 to reflect the implied
fair value of goodwill for Government Solutions and SQM reporting units,
respectively. Further, we recorded a $0.5 million and $1.8 million pretax
impairment charge in the fourth quarter of 2009 to reflect the fair value
of certain intangible assets relating to Government Solutions and SQM
reporting units, respectively. The reduction in the value of intangibles
assets will reduce the rate of amortization for these acquisitions in
2010.
|
|
·
|
As
a result of the impairment, as of December 31, 2009, the Company was no
longer in compliance with the financial covenants in its secured credit
agreement with JPMorgan Chase Bank, N.A. (“Credit Agreement”).
Accordingly, the Company renegotiated the terms of the Credit Agreement
and entered into the third amendment of the Credit Agreement on March 26,
2010. See Note 18 – Subsequent
Event.
|
|
·
|
As
a result of lower revenues, our SG&A expense during 2009 increased as
percentage of revenue by 2.3 percentage points to 20.3% in 2009. Rather
than reduce investments in marketing and sales on a short run basis, we
chose to continue our investment in sales and marketing to increase our
backlog of new business. We reorganized our sales and solution design
organizations to better serve our global customers, which resulted in a
minor restructuring of our European business in the fourth quarter
2009.
|
|
·
|
Our
Lean ITIL (Information Technology Infrastructure Library) business model
demonstrates an improvement in our operational excellence, which is the
foundation of our business. Our gross margin improved in our commercial
business in both the Americas and
Europe.
|
|
·
|
We
believe the focused development of our Lean ITIL-based service desk
expertise positions the Company well in the enterprise support services
market, as the implementation of ITIL and Lean principles into our
customer’s environment improves quality and lowers cost. It
provides us with an avenue to drive value into our customer engagement
with higher margin value-added services, including remote
infrastructure management and security
administration.
|
|
·
|
We
have extended our global reach by expanding into important, targeted
geographies and by leveraging the strong relationships that we have with
current global clients to provide services to them across geographies and
in new markets.
|
|
·
|
For
a company of our size, we have a superb customer base and impressive
capability to deliver standardized, cost-effective services globally. In
this way, we believe we have made significant strides in the establishment
of TechTeam as a brand leader in our chosen service
offerings.
|
Year Ended December
31,
|
Increase
|
%
|
||||||||||||||
2009
|
2008
|
(Decrease)
|
Change
|
|||||||||||||
(In
thousands, except percentages)
|
||||||||||||||||
Revenue
|
||||||||||||||||
Commercial
Business
|
||||||||||||||||
IT
Outsourcing Services
|
$ | 106,229 | $ | 120,166 | $ | (13,937 | ) | (11.6 | )% | |||||||
IT
Consulting and Systems Integration
|
12,755 | 27,064 | (14,309 | ) | (52.9 | )% | ||||||||||
Other
Services
|
15,817 | 24,110 | (8,293 | ) | (34.4 | )% | ||||||||||
Total
Commercial
|
134,801 | 171,340 | (36,539 | ) | (21.3 | )% | ||||||||||
Government
Technology Services
|
76,440 | 88,615 | (12,175 | ) | (13.7 | )% | ||||||||||
Total
revenue
|
$ | 211,241 | $ | 259,955 | $ | (48,714 | ) | (18.7 | )% |
Year Ended December
31,
|
||||||||||||||||||||||||
2009
|
2008
|
|||||||||||||||||||||||
Amount
|
Gross
Margin %
|
Amount
|
Gross
Margin %
|
Increase
(Decrease)
|
%
Change
|
|||||||||||||||||||
(In
thousands, except percentages)
|
||||||||||||||||||||||||
Gross
Profit
|
||||||||||||||||||||||||
Commercial
|
||||||||||||||||||||||||
IT
Outsourcing Services
|
$ | 23,330 | 22.0 | % | $ | 24,350 | 20.3 | % | $ | (1,020 | ) | (4.2 | )% | |||||||||||
IT
Consulting and Systems
Integration
|
2,865 | 22.5 | % | 6,427 | 23.7 | % | (3,562 | ) | (55.4 | )% | ||||||||||||||
Other
Services
|
3,854 | 24.4 | % | 5,427 | 22.5 | % | (1,573 | ) | (29.0 | )% | ||||||||||||||
Total
Commercial
|
30,049 | 22.3 | % | 36,204 | 21.1 | % | (6,155 | ) | (17.0 | )% | ||||||||||||||
Government
Technology Services
|
20,437 | 26.7 | % | 24,232 | 27.3 | % | (3,795 | ) | (15.7 | )% | ||||||||||||||
Total
gross profit
|
$ | 50,486 | 23.9 | % | $ | 60,436 | 23.2 | % | $ | (9,950 | ) | (16.5 | )% |
Year Ended December
31,
|
Increase
|
%
|
||||||||||||||
2009
|
2008
|
(Decrease)
|
Change
|
|||||||||||||
(In
thousands, except percentages)
|
||||||||||||||||
Revenue
|
||||||||||||||||
Commercial
|
||||||||||||||||
Americas
|
$ | 65,836 | $ | 72,375 | $ | (6,539 | ) | (9.0 | )% | |||||||
Europe
|
68,965 | 98,965 | (30,000 | ) | (30.3 | )% | ||||||||||
Total
Commercial
|
134,801 | 171,340 | (36,539 | ) | (21.3 | )% | ||||||||||
Government
|
76,440 | 88,615 | (12,175 | ) | (13.7 | )% | ||||||||||
Total
revenue
|
$ | 211,241 | $ | 259,955 | $ | (48,714 | ) | (18.7 | )% | |||||||
Gross
Margin
|
||||||||||||||||
Commercial
|
||||||||||||||||
Americas
|
20.0 | % | 19.8 | % | ||||||||||||
Europe
|
24.3 | % | 22.1 | % | ||||||||||||
Total
Commercial
|
22.3 | % | 21.1 | % | ||||||||||||
Government
|
26.7 | % | 27.3 | % | ||||||||||||
Total
Gross Margin
|
23.9 | % | 23.2 | % |
Year Ended December
31,
|
Increase
|
%
|
||||||||||||||
2009
|
2008
|
(Decrease)
|
Change
|
|||||||||||||
(In
thousands, except percentages)
|
||||||||||||||||
Operating
Expenses and Other
|
||||||||||||||||
Selling,
general and administrative expense
|
$ | 42,823 | $ | 46,920 | $ | (4,097 | ) | (8.7 | )% | |||||||
Impairment
charges
|
$ | 27,453 | $ | — | $ | 27,453 |
NM
|
|||||||||
Restructuring
charges, net
|
$ | 411 | $ | 5,719 | $ | (5,308 | ) | (92.8 | )% | |||||||
Net
interest expense
|
$ | 1,018 | $ | 1,712 | $ | (694 | ) | (40.5 | )% | |||||||
Foreign
currency transaction (loss) gain
|
$ | (675 | ) | $ | 910 | $ | (1,585 | ) |
NM
|
|||||||
Other
income, net
|
$ | — | $ | 155 | $ | 155 | (100.0 | )% | ||||||||
Income
tax (benefit) provision
|
$ | (3,261 | ) | $ | 4,182 | $ | (7,443 | ) | (178.0 | )% |
Year Ended December
31,
|
Increase
|
%
|
||||||||||||||
2008
|
2007
|
(Decrease)
|
Change
|
|||||||||||||
(In
thousands, except percentages)
|
||||||||||||||||
Revenue
|
||||||||||||||||
Commercial
Business
|
||||||||||||||||
IT Outsourcing
Services
|
$ | 120,166 | $ | 104,659 | $ | 15,507 | 14.8 | % | ||||||||
IT Consulting and Systems
Integration
|
27,064 | 28,064 | (1,000 | ) | (3.6 | )% | ||||||||||
Other Services
|
24,110 | 20,219 | 3,891 | 19.2 | % | |||||||||||
Total Commercial
|
171,340 | 152,942 | 18,398 | 12.0 | % | |||||||||||
Government Technology
Services
|
88,615 | 69,254 | 19,361 | 28.0 | % | |||||||||||
Total
revenue
|
$ | 259,955 | $ | 222,196 | $ | 37,759 | 17.0 | % |
Year Ended December
31,
|
||||||||||||||||||||||||
2008
|
2007
|
|||||||||||||||||||||||
Amount
|
Gross
Margin %
|
Amount
|
Gross
Margin %
|
Increase
(Decrease)
|
%
Change
|
|||||||||||||||||||
(In
thousands, except percentages)
|
||||||||||||||||||||||||
Gross
Profit
|
||||||||||||||||||||||||
Commercial
|
||||||||||||||||||||||||
IT Outsourcing
Services
|
$ | 24,350 | 20.3 | % | $ | 19,927 | 19.0 | % | $ | 4,423 | 22.2 | % | ||||||||||||
IT Consulting and
Systems
Integration
|
6,427 | 23.7 | % | 6,187 | 22.0 | % | 240 | 3.9 | % | |||||||||||||||
Other Services
|
5,427 | 22.5 | % | 4,789 | 23.7 | % | 638 | 13.3 | % | |||||||||||||||
Total Commercial
|
36,204 | 21.1 | % | 30,903 | 20.2 | % | 5,301 | 17.2 | % | |||||||||||||||
Government
Technology
Services
|
24,232 | 27.3 | % | 18,867 | 27.2 | % | 5,365 | 28.4 | % | |||||||||||||||
Total
gross profit
|
$ | 60,436 | 23.2 | % | $ | 49,770 | 22.4 | % | $ | 10,666 | 21.4 | % |
Year Ended December
31,
|
Increase
|
%
|
||||||||||||||
2008
|
2007
|
(Decrease)
|
Change
|
|||||||||||||
(In
thousands, except percentages)
|
||||||||||||||||
Revenue
|
||||||||||||||||
Commercial
|
||||||||||||||||
Americas
|
$ | 72,375 | $ | 68,022 | $ | 4,353 | 6.4 | % | ||||||||
Europe
|
98,965 | 84,920 | 14,045 | 16.5 | % | |||||||||||
Total Commercial
|
171,340 | 152,942 | 18,398 | 12.0 | % | |||||||||||
Government
|
88,615 | 69,254 | 19,361 | 28.0 | % | |||||||||||
Total
revenue
|
$ | 259,955 | $ | 222,196 | $ | 37,759 | 17.0 | % | ||||||||
Gross
Margin
|
||||||||||||||||
Commercial
|
||||||||||||||||
Americas
|
19.8 | % | 17.5 | % | ||||||||||||
Europe
|
22.1 | % | 22.4 | % | ||||||||||||
Total Commercial
|
21.1 | % | 20.2 | % | ||||||||||||
Government
|
27.3 | % | 27.2 | % | ||||||||||||
Total
Gross Margin
|
23.2 | % | 22.4 | % |
Year Ended December
31,
|
Increase
|
%
|
||||||||||||||
2008
|
2007
|
(Decrease)
|
Change
|
|||||||||||||
(In
thousands, except percentages)
|
||||||||||||||||
Operating
Expenses and Other
|
||||||||||||||||
Selling,
general and administrative expense
|
$ | 46,920 | $ | 39,475 | $ | 7,445 | 18.9 | % | ||||||||
Restructuring
charges
|
$ | 5,719 | $ | — | $ | 5,719 |
NM
|
% | ||||||||
Net
interest expense
|
$ | 1,712 | $ | 572 | $ | 1,140 |
NM
|
% | ||||||||
Foreign
currency transaction gain (loss)
|
$ | 910 | $ | (84 | ) | $ | 994 |
NM
|
% | |||||||
Other
income, net
|
$ | 155 | $ | — | $ | 155 |
NM
|
% | ||||||||
Income
tax provision
|
$ | 4,182 | $ | 3,343 | $ | 839 | 25.1 | % |
Maturities of Material Contractual
Obligations
|
Debt
|
Operating
Leases
|
||||||
(In
thousands)
|
||||||||
Less
than one year
|
$ | 4,074 | $ | 4,178 | ||||
1-3
years
|
11,051 | 7,524 | ||||||
4-5
years
|
— | 2,834 | ||||||
Thereafter
|
— | 698 | ||||||
Total
|
$ | 15,125 | $ | 15,234 |
Item
7A.
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
|
Page
|
||
Management
Report on Internal Control over Financial Reporting
|
47
|
|
Report
of Independent Registered Public Accounting Firm
|
47
|
|
Report
of Independent Registered Public Accounting Firm
|
48
|
|
Consolidated
Statements of Operations — Years Ended December 31, 2009, 2008 and
2007
|
49
|
|
Consolidated
Statements of Comprehensive Income (Loss) — Years Ended December 31, 2009,
2008 and 2007
|
50
|
|
Consolidated
Balance Sheets — As of December 31, 2009 and 2008
|
51
|
|
Consolidated
Statements of Shareholders’ Equity — Years Ended December 31, 2009, 2008
and 2007
|
52
|
|
Consolidated
Statements of Cash Flows — Years Ended December 31, 2009, 2008 and
2007
|
53
|
|
Notes
to the Consolidated Financial Statements
|
54
|
Year Ended December
31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
Revenue
|
||||||||||||
Commercial
|
||||||||||||
IT Outsourcing
Services
|
$ | 106,229 | $ | 120,166 | $ | 104,659 | ||||||
IT Consulting and Systems
Integration
|
12,755 | 27,064 | 28,064 | |||||||||
Other Services
|
15,817 | 24,110 | 20,219 | |||||||||
Total
Commercial
|
134,801 | 171,340 | 152,942 | |||||||||
Government Technology
Services
|
76,440 | 88,615 | 69,254 | |||||||||
Total revenue Total
corporate services
|
211,241 | 259,955 | 222,196 | |||||||||
Cost
of revenue
|
||||||||||||
Commercial
|
||||||||||||
IT Outsourcing
Services
|
82,899 | 95,816 | 84,732 | |||||||||
IT Consulting and Systems
Integration
|
9,890 | 20,637 | 21,877 | |||||||||
Other Services
|
11,963 | 18,683 | 15,430 | |||||||||
Total
Commercial
|
104,752 | 135,136 | 122,039 | |||||||||
Government Technology
Services
|
56,003 | 64,383 | 50,387 | |||||||||
Total cost of revenue
Total corporate services
|
160,755 | 199,519 | 172,426 | |||||||||
Gross
profit
|
||||||||||||
Commercial
|
30,049 | 36,204 | 30,903 | |||||||||
Government Technology
Services
|
20,437 | 24,232 | 18,867 | |||||||||
Total
gross profit
|
50,486 | 60,436 | 49,770 | |||||||||
Selling, general and
administrative expense
|
42,823 | 46,920 | 39,475 | |||||||||
Impairment
charges
|
27,453 | — | — | |||||||||
Restructuring charges,
net
|
411 | 5,719 | — | |||||||||
Operating
(loss) income
|
(20,201 | ) | 7,797 | 10,295 | ||||||||
Net interest
expense
|
(1,018 | ) | (1,712 | ) | (572 | ) | ||||||
Foreign currency transaction
(loss) gain
|
(675 | ) | 910 | (84 | ) | |||||||
Other income,
net
|
— | 155 | — | |||||||||
(Loss)
income before income taxes
|
(21,894 | ) | 7,150 | 9,639 | ||||||||
Income tax (benefit)
provision
|
(3,261 | ) | 4,182 | 3,343 | ||||||||
Net
(loss) income
|
$ | (18,633 | ) | $ | 2,968 | $ | 6,296 | |||||
Basic
(loss) earnings per common share
|
$ | (1.75 | ) | $ | 0.28 | $ | 0.61 | |||||
Diluted
(loss) earnings per common share
|
$ | (1.75 | ) | $ | 0.28 | $ | 0.60 | |||||
Weighted
average number of common shares and common share equivalents
outstanding
|
||||||||||||
Basic—common
|
10,618 | 10,529 | 10,355 | |||||||||
Diluted—common
|
10,618 | 10,555 | 10,506 |
Year
Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
Net
(loss) income, as set forth in the consolidated statements of
operations
|
$ | (18,633 | ) | $ | 2,968 | $ | 6,296 | |||||
Other
comprehensive (loss) income
|
||||||||||||
Foreign currency translation
adjustment
|
1,079 | (3,525 | ) | 1,487 | ||||||||
Unrealized gain (loss) on
derivative instrument
|
625 | (318 | ) | (755 | ) | |||||||
Comprehensive
(loss) income
|
$ | (16,929 | ) | $ | (875 | ) | $ | 7,028 |
December 31,
|
||||||||
2009
|
2008
|
|||||||
ASSETS
|
||||||||
Current
assets
|
||||||||
Cash
and cash equivalents
|
$ | 15,969 | $ | 16,881 | ||||
Accounts
receivable (less allowance of $1,315 at December 31, 2009 and $986 at
December 31, 2008)
|
44,314 | 59,705 | ||||||
Prepaid
expenses and other current assets
|
3,766 | 4,315 | ||||||
Total
current assets
|
64,049 | 80,901 | ||||||
Property,
equipment and software, net
|
6,231 | 8,327 | ||||||
Goodwill
and other intangible assets, net
|
47,270 | 77,361 | ||||||
Deferred
income taxes
|
3,940 | — | ||||||
Other
assets
|
1,030 | 774 | ||||||
Total
assets
|
$ | 122,520 | $ | 167,363 | ||||
LIABILITIES
AND SHAREHOLDERS’ EQUITY
|
||||||||
Current
liabilities
|
||||||||
Current
portion of long-term debt
|
$ | 4,074 | $ | 7,987 | ||||
Accounts
payable
|
5,130 | 6,340 | ||||||
Accrued
payroll and related taxes
|
8,486 | 12,477 | ||||||
Accrued
expenses
|
5,237 | 9,054 | ||||||
Deferred
revenue
|
3,213 | 1,435 | ||||||
Other
current liabilities
|
955 | 1,181 | ||||||
Total
current liabilities
|
27,095 | 38,474 | ||||||
Long-term
liabilities
|
||||||||
Long-term
debt, less current portion
|
11,051 | 27,202 | ||||||
Deferred
income taxes
|
— | 1,966 | ||||||
Other
long-term liabilities
|
745 | 988 | ||||||
Total
long-term liabilities
|
11,796 | 30,156 | ||||||
Shareholders’
equity
|
||||||||
Preferred
stock, 5,000,000 shares authorized, no shares issued
|
— | — | ||||||
Common
stock, $0.01 par value, 45,000,000 shares authorized, 11,118,309 and
10,884,998 shares issued and outstanding at December 31, 2009 and
2008, respectively
|
111 | 109 | ||||||
Additional
paid-in capital
|
79,762 | 77,939 | ||||||
Retained
earnings
|
2,726 | 21,359 | ||||||
Accumulated
other comprehensive income (loss)
|
1,030 | (674 | ) | |||||
Total
shareholders’ equity
|
83,629 | 98,733 | ||||||
Total
liabilities and shareholders’ equity
|
$ | 122,520 | $ | 167,363 |
Common
Stock
|
Additional
Paid-in Capital
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Total
Shareholders’
Equity
|
||||||||||||||||
Balance
at January 1, 2007
|
$ | 104 | $ | 71,672 | $ | 12,095 | $ | 2,437 | $ | 86,308 | ||||||||||
Proceeds
from issuance of shares under
stock option plans
|
1 | 1,093 | — | — | 1,094 | |||||||||||||||
Common
stock issued to directors
|
— | 219 | — | — | 219 | |||||||||||||||
Issuance
of restricted stock
|
2 | (2 | ) | — | — | — | ||||||||||||||
Shares
issued in connection with acquisitions
|
— | 300 | — | — | 300 | |||||||||||||||
Share-based
compensation
|
— | 1,521 | — | — | 1,521 | |||||||||||||||
Net
income for 2007
|
— | — | 6,296 | — | 6,296 | |||||||||||||||
Unrealized
loss on derivative instrument
|
— | — | — | (755 | ) | (755 | ) | |||||||||||||
Foreign
currency translation adjustment
|
— | — | — | 1,487 | 1,487 | |||||||||||||||
Other
|
— | 561 | — | — | 561 | |||||||||||||||
Balance
at December 31, 2007
|
107 | 75,364 | 18,391 | 3,169 | 97,031 | |||||||||||||||
Proceeds
from issuance of shares under
stock option plans
|
1 | 408 | — | — | 409 | |||||||||||||||
Common
stock issued to directors
|
— | 160 | — | — | 160 | |||||||||||||||
Purchase
of common stock
|
— | (61 | ) | — | — | (61 | ) | |||||||||||||
Issuance
of restricted stock
|
1 | (1 | ) | — | — | — | ||||||||||||||
Share-based
compensation
|
— | 2,157 | — | — | 2,157 | |||||||||||||||
Net
income for 2008
|
— | — | 2,968 | — | 2,968 | |||||||||||||||
Unrealized
loss on derivative instrument
|
— | — | — | (318 | ) | (318 | ) | |||||||||||||
Foreign
currency translation adjustment
|
— | — | — | (3,525 | ) | (3,525 | ) | |||||||||||||
Other
|
— | (88 | ) | — | — | (88 | ) | |||||||||||||
Balance
at December 31, 2008
|
109 | 77,939 | 21,359 | (674 | ) | 98,733 | ||||||||||||||
Common
stock issued to directors
|
— | 148 | — | — | 148 | |||||||||||||||
Issuance
of restricted stock
|
2 | (2 | ) | — | — | — | ||||||||||||||
Share-based
compensation
|
— | 1,776 | — | — | 1,776 | |||||||||||||||
Net
loss for 2009
|
— | — | (18,633 | ) | — | (18,633 | ) | |||||||||||||
Unrealized
gain on derivative instrument
|
— | — | — | 625 | 625 | |||||||||||||||
Foreign
currency translation adjustment
|
— | — | — | 1,079 | 1,079 | |||||||||||||||
Other
|
— | (99 | ) | — | — | (99 | ) | |||||||||||||
Balance
at December 31, 2009
|
$ | 111 | $ | 79,762 | $ | 2,726 | $ | 1,030 | $ | 83,629 |
Year Ended December
31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
Operating
activities
|
||||||||||||
Net (loss)
income
|
$ | (18,633 | ) | $ | 2,968 | $ | 6,296 | |||||
Adjustments
to reconcile net (loss) income to net cash provided
by operating activities:
|
||||||||||||
Depreciation
|
3,344 | 4,076 | 3,383 | |||||||||
Amortization
|
3,138 | 3,859 | 3,623 | |||||||||
Impairment
charge
|
27,453 | — | — | |||||||||
Non-cash
expense related to stock options and issuance of
common stock and restricted common stock
|
1,924 | 2,317 | 1,387 | |||||||||
Gain on disposition of
business
|
— | (155 | ) | — | ||||||||
Deferred income
taxes
|
(6,201 | ) | (187 | ) | (1,148 | ) | ||||||
Provision for uncollectible
accounts
|
614 | 479 | 145 | |||||||||
Other
|
66 | (21 | ) | 8 | ||||||||
Changes in assets and
liabilities, net of acquisitions —
|
||||||||||||
Accounts
receivable
|
15,216 | 6,595 | (18,329 | ) | ||||||||
Prepaid expenses and other
assets
|
604 | 379 | 1,259 | |||||||||
Accounts
payable
|
(1,228 | ) | (13,840 | ) | 11,059 | |||||||
Accrued payroll and related
taxes
|
(4,127 | ) | (477 | ) | (1,084 | ) | ||||||
Income taxes receivable and
accrued income taxes
|
(1,243 | ) | 1,442 | 721 | ||||||||
Deferred
revenue
|
1,765 | 37 | (415 | ) | ||||||||
Accrued expenses and other
liabilities
|
(2,504 | ) | 1,336 | (974 | ) | |||||||
Net operating cash flow from
discontinued operations
|
— | — | (3 | ) | ||||||||
Net cash provided by operating
activities
|
20,188 | 8,808 | 5,928 | |||||||||
Investing
activities
|
||||||||||||
Disposition of business, net of
cash disposed
|
— | 953 | — | |||||||||
Purchases of property, equipment
and software
|
(1,317 | ) | (2,475 | ) | (3,882 | ) | ||||||
Cash paid for acquisitions, net
of cash acquired
|
(501 | ) | (6,084 | ) | (47,160 | ) | ||||||
Net cash used in investing
activities
|
(1,818 | ) | (7,606 | ) | (51,042 | ) | ||||||
Financing
activities
|
||||||||||||
Proceeds from issuance of
long-term debt
|
— | 5,000 | 38,900 | |||||||||
Proceeds from issuance of common
stock
|
— | 348 | 1,085 | |||||||||
Purchase of common
stock
|
— | (61 | ) | — | ||||||||
Other
|
(99 | ) | (28 | ) | 570 | |||||||
Payments on long-term
debt
|
(20,064 | ) | (6,873 | ) | (6,299 | ) | ||||||
Net cash (used in) provided by
financing activities
|
(20,163 | ) | (1,614 | ) | 34,256 | |||||||
Effect
of exchange rate changes on cash and cash equivalents
|
881 | (2,138 | ) | 207 | ||||||||
Decrease
in cash and cash equivalents
|
(912 | ) | (2,550 | ) | (10,651 | ) | ||||||
Cash
and cash equivalents at beginning of year
|
16,881 | 19,431 | 30,082 | |||||||||
Cash
and cash equivalents at end of year
|
$ | 15,969 | $ | 16,881 | $ | 19,431 |
Year
Ended
December
31,
|
||||||||
2008
|
2007
|
|||||||
(In
thousands)
|
||||||||
Cost
of revenue
increase
|
$ | 5,854 | $ | 7,073 | ||||
Gross
profit
decrease
|
(5,854 | ) | (7,073 | ) | ||||
Selling,
general, and administrative expense decrease
|
(5,854 | ) | (7,073 | ) | ||||
Net
income
|
— | — | ||||||
Earnings
per share
|
— | — |
Year Ended December
31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(In
thousands, except per share data)
|
||||||||||||
Net
(loss) income
|
$ | (18,633 | ) | $ | 2,968 | $ | 6,296 | |||||
Basic
weighted average common shares
|
10,618 | 10,529 | 10,355 | |||||||||
Common
stock equivalents
|
— | 26 | 151 | |||||||||
Diluted
weighted average common shares
|
10,618 | 10,555 | 10,506 | |||||||||
(Loss)
earnings per share:
|
||||||||||||
Basic (loss) earnings per common
share
|
$ | (1.75 | ) | $ | 0.28 | $ | 0.61 | |||||
Diluted (loss) earnings per
common share
|
$ | (1.75 | ) | $ | 0.28 | $ | 0.60 |
Accrued
Restructuring
Charges
at
December
31,
2008
|
Adjustments
to
Accrued
Restructuring
Charges
|
Cash
Payments
|
Accrued
Restructuring
Charges
at
December
31,
2009
|
|||||||||||||
(In
thousands)
|
||||||||||||||||
Workforce
reductions
|
$ | — | $ | 1,167 | $ | (1,005 | ) | $ | 162 |
Accrued
Restructuring
Charges at
December 31,
2008
|
Adjustments
to Accrued
Restructuring
Charges
|
Cash
Payments
|
Accrued
Restructuring
Charges at
December 31,
2009
|
|||||||||||||
(In
thousands)
|
||||||||||||||||
Workforce
reductions
|
$ | 359 | $ | (43 | ) | $ | (316 | ) | $ | — | ||||||
Other
|
1,387 | (713 | ) | (518 | ) | 156 | ||||||||||
Total
|
$ | 1,746 | $ | (756 | ) | $ | (834 | ) | $ | 156 |
Accrued
Restructuring
Charges at
December 31,
2008
|
Adjustments
to Accrued
Restructuring
Charges
|
Cash
Payments
|
Accrued
Restructuring
Charges at
December 31,
2009
|
|||||||||||||
|
(In
thousands)
|
|||||||||||||||
Restructuring
charges
|
||||||||||||||||
Commercial —
|
||||||||||||||||
IT Outsourcing
Services
|
$ | 40 | $ | (26 | ) | $ | (14 | ) | $ | — | ||||||
IT Consulting and Systems
Integration
|
50 | — | (50 | ) | — | |||||||||||
Other Services
|
80 | — | (80 | ) | — | |||||||||||
Total
Commercial
|
170 | (26 | ) | (144 | ) | — | ||||||||||
Government Technology
Services
|
367 | — | (216 | ) | 151 | |||||||||||
Selling, general and
administrative expense
|
1,209 | (730 | ) | (474 | ) | 5 | ||||||||||
Total
restructuring charges
|
$ | 1,746 | $ | (756 | ) | $ | (834 | ) | $ | 156 |
IT
Outsourcing
Services
|
Government
Technology
Services
|
IT
Consulting
and
Systems
Integration
|
Other
Services
|
Total
|
||||||||||||||||
(In
thousands)
|
||||||||||||||||||||
Balance
as of January 1, 2007
|
$ | 371 | $ | 19,670 | $ | 2,417 | $ | — | $ | 22,458 | ||||||||||
Goodwill
acquired
|
875 | 34,133 | 995 | 3,062 | 39,065 | |||||||||||||||
Balance
as of December 31, 2007
|
1,246 | 53,803 | 3,412 | 3,062 | 61,523 | |||||||||||||||
Goodwill
acquired
|
4,216 | 146 | 23 | 5 | 4,390 | |||||||||||||||
Disposition of
business
|
— | — | (742 | ) | — | (742 | ) | |||||||||||||
Balance
as of December 31, 2008
|
5,462 | 53,949 | 2,693 | 3,067 | 65,171 | |||||||||||||||
Goodwill
impairment
|
(877 | ) | (20,766 | ) | (439 | ) | (3,067 | ) | (25,149 | ) | ||||||||||
Goodwill
acquired
|
501 | — | — | — | 501 | |||||||||||||||
Balance
as of December 31, 2009
|
$ | 5,086 | $ | 33,183 | $ | 2,254 | $ | — | $ | 40,523 |
December 31, 2009
|
Weighted
Average
|
December 31, 2008
|
Weighted
Average
|
||||||||||||||||
Cost
|
Accumulated
Amortization
|
Amortization
Period
|
Cost
|
Accumulated
Amortization
|
Amortization
Period
|
||||||||||||||
(In thousands)
|
(In thousands)
|
||||||||||||||||||
Customer-related
assets
|
$ | 12,461 | $ | 5,833 |
6.6
years
|
$ | 22,407 | $ | 10,533 |
7.3
years
|
|||||||||
Noncompete
agreement
|
1,175 | 1,056 |
3.8
years
|
1,175 | 907 |
3.8
years
|
|||||||||||||
Trademark
and other
|
384 | 384 |
3.9
years
|
443 | 395 |
4.1
years
|
|||||||||||||
$ | 14,020 | $ | 7,273 | $ | 24,025 | $ | 11,835 |
Level 1 —
|
Observable
inputs such as quoted prices (unadjusted) in active markets for identical
assets or liabilities.
|
Level 2 —
|
Inputs
other than quoted prices that are observable for the asset or liability,
either directly or indirectly. These include quoted prices for similar
assets or liabilities in active markets and quoted prices for identical or
similar assets or liabilities in markets that are not
active.
|
Level 3 —
|
Unobservable
inputs that reflect the reporting entity’s own
assumptions.
|
Fair Value as of December 31, 2009 (In thousands)
|
||||||||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Interest
rate swap
|
$ | (449 | ) | N/A | $ | (449 | ) | N/A |
Fair Value as of December 31, 2008 (In thousands)
|
||||||||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Interest
rate swap
|
$ | (1,074 | ) | N/A | $ | (1,074 | ) | N/A |
Fair Value as of December 31, 2009 (In thousands)
|
||||||||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Goodwill
|
$ | 40,523 | N/A | N/A | $ | 40,523 | ||||||||||
Customer
Relationships
|
$ | 6,628 | N/A | N/A | $ | 6,628 | ||||||||||
Non-compete
|
$ | 119 | N/A | N/A | $ | 119 |
Onvaio
|
RL Phillips
|
NewVectors
|
SQM
|
|||||||||||||
(In thousands)
|
||||||||||||||||
Goodwill
|
$ | 4,714 | $ | 1,604 | $ | 32,675 | $ | 4,382 | ||||||||
Amortizable
intangible assets
|
1,225 | 162 | 6,230 | 2,936 | ||||||||||||
Property,
equipment and software
|
27 | — | 386 | 86 | ||||||||||||
Other
current and non-current assets, net of cash acquired
|
42 | 993 | 7,458 | 2,232 | ||||||||||||
Accounts
payable and accrued liabilities assumed
|
(470 | ) | (389 | ) | (6,176 | ) | (4,436 | ) | ||||||||
Accrued
purchase price
|
— | (50 | ) | — | — | |||||||||||
Notes
payable assumed
|
— | — | — | (95 | ) | |||||||||||
Issuance
of equity instruments
|
— | (300 | ) | — | — | |||||||||||
Net
cash used
|
$ | 5,538 | $ | 2,020 | $ | 40,573 | $ | 5,105 |
Year Ended
December 31,
|
||||
2007
|
||||
(In thousands,
except per share
data)
|
||||
Revenue
|
||||
As
reported
|
$ | 222,196 | ||
Pro
forma
|
$ | 236,327 | ||
Income
from continuing operations
|
||||
As
reported
|
$ | 6,296 | ||
Pro
forma
|
$ | 6,761 | ||
Net
income
|
||||
As
reported
|
$ | 6,296 | ||
Pro
forma
|
$ | 6,761 | ||
Diluted
earnings per common share
|
||||
As
reported
|
$ | 0.60 | ||
Pro
forma
|
$ | 0.64 |
December 31,
|
||||||||
2009
|
2008
|
|||||||
(In thousands)
|
||||||||
Computer
equipment and office furniture
|
$ | 31,384 | $ | 30,575 | ||||
Software
|
15,512 | 15,187 | ||||||
Leasehold
improvements
|
6,618 | 6,495 | ||||||
Transportation
equipment
|
331 | 373 | ||||||
53,845 | 52,630 | |||||||
Less
— Accumulated depreciation and amortization
|
(47,614 | ) | (44,303 | ) | ||||
Net
property, equipment and software
|
$ | 6,231 | $ | 8,327 |
Year Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(In thousands)
|
||||||||||||
Current:
|
||||||||||||
U.S.
federal
|
$ | 1,898 | $ | 1,498 | $ | 1,568 | ||||||
State
|
498 | 695 | 365 | |||||||||
Foreign
|
533 | 1,386 | 1,710 | |||||||||
Total
current provision
|
2,929 | 3,579 | 3,643 | |||||||||
Deferred
|
(6,190 | ) | 603 | (300 | ) | |||||||
Total
income tax (benefit) provision
|
$ | (3,261 | ) | $ | 4,182 | $ | 3,343 |
Year Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(In thousands)
|
||||||||||||
Domestic
(loss) income
|
$ | (16,595 | ) | $ | 7,730 | $ | 3,984 | |||||
Foreign
(loss) income
|
(5,299 | ) | (580 | ) | 5,655 | |||||||
(Loss)
income before income taxes (benefit)
|
$ | (21,894 | ) | $ | 7,150 | $ | 9,639 |
Year Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(In thousands)
|
||||||||||||
Income
tax (benefit) provision at federal statutory rate of 34%
|
$ | (7,444 | ) | $ | 2,431 | $ | 3,277 | |||||
State
taxes, net of federal benefit
|
(243 | ) | 459 | 241 | ||||||||
Permanent
differences
|
4,373 | 84 | 75 | |||||||||
Foreign
operating losses not benefited/valuation allowance
|
(476 | ) | 1,083 | 274 | ||||||||
Effect
of foreign tax rates
|
632 | (76 | ) | (487 | ) | |||||||
Other
|
(103 | ) | 201 | (37 | ) | |||||||
Total
income tax (benefit) provision
|
$ | (3,261 | ) | $ | 4,182 | $ | 3,343 |
As of December 31,
|
||||||||||||||||
2009
|
2008
|
|||||||||||||||
Assets
|
Liabilities
|
Assets
|
Liabilities
|
|||||||||||||
(In
thousands)
|
||||||||||||||||
Net
operating loss carryforwards
|
$ | 1,183 | $ | — | $ | 1,756 | $ | — | ||||||||
Accruals
and reserves
|
594 | — | 466 | — | ||||||||||||
Accelerated
tax depreciation
|
27 | — | — | 75 | ||||||||||||
Intangible
assets
|
2,314 | — | — | 3,357 | ||||||||||||
Prepaid
expenses
|
— | 301 | — | 320 | ||||||||||||
Other
|
1,698 | — | 1,331 | — | ||||||||||||
Total
deferred income taxes
|
5,816 | 301 | 3,553 | 3,752 | ||||||||||||
Less
— Valuation allowance
|
(1,163 | ) | — | (1,639 | ) | — | ||||||||||
Net
deferred income taxes
|
$ | 4,653 | $ | 301 | $ | 1,914 | $ | 3,752 |
Major
Jurisdiction
|
Open
Years
|
|
U.S.
Federal income taxes
|
2005
through 2009
|
|
U.S.
State income taxes
|
2005
through 2009
|
|
Foreign
income taxes
|
2003
through
2009
|
December 31,
|
||||||||
2009
|
2008
|
|||||||
Balance
at beginning of period
|
$ | 107,100 | $ | 52,000 | ||||
Additions
for tax positions of prior years
|
6,000 | 77,100 | ||||||
Settlements
|
— | (22,000 | ) | |||||
Balance
at end of period
|
$ | 113,100 | $ | 107,100 |
Year
|
Lease
Payments
|
Sublease
Receipts
|
||||||
(In thousands)
|
||||||||
2010
|
$ | 4,178 | $ | 93 | ||||
2011
|
3,169 | 97 | ||||||
2012
|
2,521 | 101 | ||||||
2013
|
1,834 | 26 | ||||||
2014
|
1,580 | — | ||||||
2015
and thereafter
|
1,952 | — | ||||||
Total
|
$ | 15,234 | $ | 317 |
Year Ended December 31,
|
|||||||||
2009
|
2008
|
2007
|
|||||||
Expected
dividend yield
|
0.0%
|
0.0%
|
0.0%
|
||||||
Weighted
average volatility
|
61%
|
37%
|
35%
|
||||||
Risk
free interest rate
|
1.4%
|
1.2-3.4%
|
3.4-5.0%
|
||||||
Expected
term (in years)
|
3.0
|
3.1
|
3.0
|
Number of
Shares
|
Weighted
Average
Exercise
Price per
Share
|
Weighted
Average
Remaining
Contractual
Term
|
Aggregate
Intrinsic
Value
|
||||||||||||
Outstanding
at January 1, 2007
|
933,967 | $ | 9.71 | ||||||||||||
Granted
|
884,000 | $ | 11.98 | ||||||||||||
Exercised
|
(127,767 | ) | $ | 8.53 | |||||||||||
Canceled
|
(178,600 | ) | $ | 10.67 | |||||||||||
Outstanding
at December 31, 2007
|
1,511,600 | $ | 11.02 | ||||||||||||
Granted
|
981,500 | $ | 8.73 | ||||||||||||
Exercised
|
(45,500 | ) | $ | 8.98 | |||||||||||
Canceled
|
(205,626 | ) | $ | 11.80 | |||||||||||
Outstanding
at December 31, 2008
|
2,241,974 | $ | 9.99 | ||||||||||||
Granted
|
76,000 | $ | 5.95 | ||||||||||||
Exercised
|
— | $ | 0.00 | ||||||||||||
Canceled
|
(274,382 | ) | $ | 10.29 | |||||||||||
Outstanding
at December 31, 2009
|
2,043,592 | $ | 9.74 |
6.6
Years
|
$ |
247,305
|
|||||||||
Vested
and expected to vest in the future at December 31, 2009
|
2,043,592 | $ | 9.74 |
6.3
Years
|
$ |
247,305
|
|||||||||
Exercisable
at December 31, 2009
|
1,190,183 | $ | 10.13 |
5.3
Years
|
$ |
47,807
|
Restricted Shares
|
Number of
Shares
|
Weighted
Average
Grant-Date
Fair Value
|
||||||
Nonvested
at January 1, 2007
|
96,220 | $ | 10.50 | |||||
Granted
|
146,483 | $ | 12.95 | |||||
Vested
|
(9,000 | ) | $ | 8.47 | ||||
Forfeited
|
(11,500 | ) | $ | 8.88 | ||||
Nonvested
at December 31, 2007
|
222,203 | $ | 12.20 | |||||
Granted
|
178,388 | $ | 8.61 | |||||
Vested
|
(78,919 | ) | $ | 11.05 | ||||
Forfeited
|
(36,107 | ) | $ | 12.09 | ||||
Nonvested
at December 31, 2008
|
285,565 | $ | 10.01 | |||||
Granted
|
298,372 | $ | 5.29 | |||||
Vested
|
(58,159 | ) | $ | 9.71 | ||||
Forfeited
|
(83,281 | ) | $ | 10.72 | ||||
Nonvested
at December 31, 2009
|
442,497 | $ | 6.79 |
Year Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(In
thousands)
|
||||||||||||
Revenue
|
||||||||||||
Commercial
|
||||||||||||
IT
Outsourcing Services
|
$ | 106,229 | $ | 120,166 | $ | 104,659 | ||||||
IT
Consulting and Systems Integration
|
12,755 | 27,064 | 28,064 | |||||||||
Other
Services
|
15,817 | 24,110 | 20,219 | |||||||||
Total
Commercial
|
134,801 | 171,340 | 152,942 | |||||||||
Government
Technology Services
|
76,440 | 88,615 | 69,254 | |||||||||
Total
revenue
|
$ | 211,241 | $ | 259,955 | $ | 222,196 | ||||||
Gross
Profit
|
||||||||||||
Commercial
|
||||||||||||
IT
Outsourcing Services
|
$ | 23,330 | $ | 24,350 | $ | 19,927 | ||||||
IT
Consulting and Systems Integration
|
2,865 | 6,427 | 6,187 | |||||||||
Other
Services
|
3,854 | 5,427 | 4,789 | |||||||||
Total
Commercial
|
30,049 | 36,204 | 30,903 | |||||||||
Government
Technology Services
|
20,437 | 24,232 | 18,867 | |||||||||
Total
gross profit
|
50,486 | 60,436 | 49,770 | |||||||||
Selling,
general and administrative expense
|
(42,823 | ) | (46,920 | ) | (39,475 | ) | ||||||
Impairment
charges
|
(27,453 | ) | — | — | ||||||||
Restructuring
charges, net
|
(411 | ) | (5,719 | ) | — | |||||||
Net
interest expense
|
(1,018 | ) | (1,712 | ) | (572 | ) | ||||||
Foreign
currency transaction (loss) gain
|
(675 | ) | 910 | (84 | ) | |||||||
Other
income, net
|
— | 155 | — | |||||||||
(Loss)
income before income taxes
|
$ | (21,894 | ) | $ | 7,150 | $ | 9,639 |
Year Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(In thousands)
|
||||||||||||
Depreciation
and Amortization
|
||||||||||||
IT
Outsourcing Services
|
$ | 1,726 | $ | 2,265 | $ | 1,914 | ||||||
IT
Consulting and Systems Integration
|
— | 173 | 158 | |||||||||
Government
Technology Services
|
— | — | 34 | |||||||||
Other
Services
|
70 | 42 | 1 | |||||||||
Unallocated
depreciation and amortization
|
4,686 | 5,455 | 4,899 | |||||||||
Total
depreciation and amortization
|
$ | 6,482 | $ | 7,935 | $ | 7,006 |
Geographic Information
|
||||||||||||||||||||||||
2009
|
2008
|
2007
|
||||||||||||||||||||||
Revenue
|
Long-Lived
Assets
|
Revenue
|
Long-Lived
Assets
|
Revenue
|
Long-Lived
Assets
|
|||||||||||||||||||
(In thousands)
|
||||||||||||||||||||||||
United
States
|
$ | 142,276 | $ | 48,641 | $ | 160,990 | $ | 72,629 | $ | 137,276 | $ | 71,497 | ||||||||||||
Europe:
|
||||||||||||||||||||||||
Belgium
|
32,597 | 1,514 | 43,557 | 1,928 | 44,272 | 3,697 | ||||||||||||||||||
Rest
of Europe
|
36,368 | 4,376 | 55,408 | 11,905 | 40,648 | 12,627 | ||||||||||||||||||
Total
Europe
|
68,965 | 5,890 | 98,965 | 13,833 | 84,920 | 16,324 | ||||||||||||||||||
Total
|
$ | 211,241 | $ | 54,531 | $ | 259,955 | $ | 86,462 | $ | 222,196 | $ | 87,821 |
Year Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
U.S.
Federal Government
|
31.7 | % | 29.7 | % | 27.1 | % | ||||||
Ford
Motor Company
|
14.3 | % | 15.9 | % | 20.1 | % | ||||||
Total
|
46.0 | % | 45.6 | % | 47.2 | % |
Quarter Ended
|
||||||||||||||||
March 31
|
June 30
|
September 30
|
December 31
|
|||||||||||||
(In thousands, except per share data)
|
||||||||||||||||
2009
|
||||||||||||||||
Revenue
|
$ | 56,105 | $ | 54,327 | $ | 52,348 | $ | 48,461 | ||||||||
Gross
profit
|
13,928 | 13,346 | 12,042 | 11,170 | ||||||||||||
Net
income (loss)
|
$ | 1,650 | $ | 1,290 | $ | 862 | $ | (22,434 | ) | |||||||
Earnings
(loss) per share:
|
||||||||||||||||
Basic
per common
|
$ | 0.16 | $ | 0.12 | $ | 0.08 | $ | (2.11 | ) | |||||||
Diluted
per common
|
$ | 0.16 | $ | 0.12 | $ | 0.08 | $ | (2.11 | ) |
Quarter Ended
|
||||||||||||||||
March 31
|
June 30
|
September 30
|
December 31
|
|||||||||||||
(In thousands, except per share data)
|
||||||||||||||||
2008
|
||||||||||||||||
Revenue
|
$ | 65,964 | $ | 67,876 | $ | 64,184 | $ | 61,930 | ||||||||
Gross
profit
|
14,778 | 15,588 | 14,807 | 15,262 | ||||||||||||
Net
income (loss)
|
$ | 1,691 | $ | (1,838 | ) | $ | 1,909 | $ | 1,207 | |||||||
Earnings
(loss) per share:
|
||||||||||||||||
Basic
per common
|
$ | 0.16 | $ | (0.17 | ) | $ | 0.18 | $ | 0.11 | |||||||
Diluted
per common
|
$ | 0.16 | $ | (0.17 | ) | $ | 0.18 | $ | 0.11 |
Item
9.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
|
Item
9A.
|
CONTROLS
AND PROCEDURES
|
Item
9B.
|
OTHER
INFORMATION
|
Item
10.
|
DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE
|
Item
11.
|
EXECUTIVE
COMPENSATION
|
Item
12.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
|
Equity Compensation Plan Information
|
||||||||||||
(a)
|
(b)
|
(c)
|
||||||||||
Plan Category
|
Number of securities
to be issued upon
exercise of outstanding
options, warrants
and rights (1)
|
Weighted-average
exercise price of
outstanding options,
warrants and rights
|
Number of securities
remaining available for
future issuance under equity
compensation plans
(excluding securities
reflected in column (a))
|
|||||||||
Equity
compensation plans approved by security holders
|
1,593,592 | $ | 10.34 | 661,062 | ||||||||
Equity
compensation plans not approved by security holders (2)
|
450,000 | $ | 7.62 | — | ||||||||
Total
|
2,043,592 | $ | 9.74 | 661,062 |
(1)
|
Represents
options to purchase shares of the Company’s common
stock.
|
(2)
|
Represents
grants made to Gary J. Cotshott and Margaret M. Loebl as inducement for
them to enter into employment with the Company. In February 2008, Mr.
Cotshott received an option to purchase 300,000 shares of the Company’s
common stock. In October 2008, Ms. Loebl received an option to purchase
150,000 shares of the Company’s common stock. The options awarded to Mr.
Cotshott have an exercise price equal to the market price on the date of
grant ($7.99), a ten-year term and vest in 16 equal installments over four
years. The options awarded to Ms. Loebl have an exercise price equal to
the market price on the date of the grant ($6.89), a ten-year term and
vest in four equal installments over four
years.
|
Item
13.
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE
|
Item
14.
|
PRINCIPAL
ACCOUNTANT FEES AND SERVICES
|
Item
15.
|
EXHIBITS
AND FINANCIAL STATEMENT SCHEDULES
|
|
a)
|
Certain
documents are filed as part of this Report on Form
10-K.
|
(1)
|
See
“Item 8 — Financial Statements and Supplementary Data” beginning at page
46.
|
(2)
|
Financial
Statement Schedules
|
|
(3)
|
Exhibits.
|
Exhibit
Number
|
Exhibit
|
Reference *
|
||
2.1
|
Share
Purchase Agreement between TechTeam Global AB and SQM Nordic AB dated
January 19, 2007.
|
*8
|
||
2.2
|
First
Amendment of Share Purchase Agreement between TechTeam Global AB and SQM
Nordic AB dated as of February 9, 2007.
|
*8
|
||
2.3
|
Membership
Interest Purchase Agreement between TechTeam Government Solutions, Inc.,
NewVectors Holding LLC, Altarum Supporting Organization, Inc. and Altarum
Institute dated May 23, 2007.
|
*10
|
||
3.1
|
Certification
of Incorporation of TechTeam Global, Inc. filed with the Delaware
Secretary of State on September 14, 1987.
|
*4
|
||
3.2
|
Certificate
of Amendment dated November 27, 1987 to our Certificate of
Incorporation.
|
*4
|
||
3.3
|
Certificate
of Amendment dated May 8, 2002 to Certificate of
Incorporation.
|
*4
|
||
3.4
|
Bylaws
of TechTeam Global, Inc. as Amended and Restated December 9,
2009.
|
*19
|
||
10.1
|
Lease
Agreement for office space in Southfield, Michigan known as the Cumberland
Tech Center between the Company and Eleven Inkster Associates dated
September 27, 1993.
|
*2
|
||
10.2
|
Seventh
Amendment dated August 24, 2006 to the Lease Agreement for office space in
Southfield, Michigan between Eleven Inkster L.L.C. and the
Company.
|
*7
|
||
10.3
|
Lease
Agreement for office space in Davenport, Iowa known as the 1010 Shopping
Center between the Company and Partnership 1010, L.L.P. dated August 28,
1999.
|
*3
|
||
10.4
|
Office
Lease Agreement by and between FJ Dulles Business Park II, L.L.C., as
Landlord, and TechTeam Government Solutions, Inc., (formerly known as
Digital Support Corporation) as Tenant, dated December 21,
2000.
|
*5
|
Exhibit
Number
|
Exhibit
|
Reference *
|
||
10.5
|
Office
Building Lease between Elizabethean Court Associates III L.P., as
landlord, and TechTeam Global, Inc., as tenant, dated May 18,
2006.
|
*9
|
||
10.6
|
Lease
Agreement for office space in Bucharest, Romania between S.C.
Italian-Romanian Industrial Development Enterprises – IRIDE SA and
TechTeam Global SRL dated February 2, 2005.
|
*6
|
||
10.7
|
Office
building lease between EVERE REAL ESTATE and TechTeam Global NV/SA, dated
July 1, 2009
|
*18
|
||
10.8
|
Office
building lease between EVERE REAL ESTATE and TechTeam Global NV/SA, dated
July 1, 2009
|
*18
|
||
10.9
|
1990
Nonqualified Stock Option Plan.
|
*1
|
||
10.10
|
2004
Incentive Stock and Awards Plan.
|
*17
|
||
10.11
|
2006
Incentive Stock and Awards Plan.
|
*17
|
||
10.12
|
TechTeam
Global, Inc. Non-Employee Directors Equity Fee Guidelines under 2006
Incentive Stock and Awards Plan.
|
*11
|
||
10.13
|
TechTeam
Global, Inc. Non-Employee Directors Deferred Compensation
Plan.
|
*11
|
||
10.14
|
TechTeam
Global, Inc. Compensation Policy for Non-Employee
Directors.
|
*11
|
||
10.15
|
TechTeam
Global, Inc. Executive Annual Incentive Plan.
|
*15
|
||
10.16
|
TechTeam
Global, Inc. Executive Long Term Incentive Program.
|
*15
|
||
10.17
|
Supplemental
Retirement Plan dated October 1, 2000.
|
*3
|
||
10.18
|
Employment
Agreement Relating to Change of Control.
|
*17
|
||
10.19
|
Form
of Indemnification Agreement
|
*19
|
||
10.20
|
Employment
and Noncompetition Agreement between TechTeam Global, Inc. and Gary J.
Cotshott, dated February 11, 2008.
|
*12
|
||
10.21
|
Amendment
to Employment and Noncompetition Agreement between TechTeam Global,
Inc. and Gary J. Cotshott
|
*17
|
||
10.22
|
Option
Agreement between TechTeam Global, Inc. and Gary J.
Cotshott
|
*17
|
||
10.23
|
Employment
and Non-Competition Agreement of Kamran Sokhanvari
|
*13
|
||
10.24
|
Amendment
to Employment and Non-Competition Agreement of Kamran
Sokhanvari
|
*17
|
||
10.25
|
Employment
and Non-Competition Agreement of Armin Pressler
|
*13
|
||
10.26
|
Amendment
to Employment and Non-Competition Agreement of Armin
Pressler
|
*17
|
||
10.27
|
Employment
and Non-Competition Agreement of Margaret M. Loebl
|
*16
|
||
10.28
|
Amendment
to Employment and Non-Competition Agreement of Margaret M.
Loebl
|
*17
|
||
10.29
|
Option
Agreement between TechTeam Global, Inc. and Margaret M.
Loebl
|
*17
|
Exhibit
Number
|
Exhibit
|
Reference *
|
||
10.30
|
Employment
Agreement Relating to Change of Control of Michael A.
Sosin
|
*17
|
||
10.31
|
Employment
Agreement Relating to Change of Control of Christopher
Donohue
|
*17
|
||
10.32
|
Retention
and Change of Control of David A. Kriegman, dated October 23,
2009.
|
|||
10.33
|
Credit
Agreement dated as of June 1, 2007 among TechTeam Global, Inc., the
Lenders Party Hereto, JPMorgan Chase Bank, NA, as Administrative Agent and
J.P. Morgan Securities, Inc., as Sole Bookrunner and Sole Lead
Arranger.
|
*10
|
||
10.34
|
Pledge
and Security Agreement dated June 1, 2007 between TechTeam Global, Inc.,
TechTeam Cyntergy, LLC, TechTeam Government Solutions, Inc., Sytel, Inc.
and JPMorgan Chase Bank, N.A. as Administrative Agent.
|
*10
|
||
10.35
|
First
Amendment to Credit Agreement and Consent
|
*14
|
||
10.36
|
Second
Amendment to Credit Agreement
|
*15
|
||
10.37
|
Third
Amendment to Credit Agreement
|
*20
|
||
21.1
|
List
of subsidiaries of TechTeam Global, Inc.
|
|||
23.1
|
Consent
of Independent Registered Public Accounting Firm.
|
|||
31.1
|
Certification
of Gary J. Cotshott Pursuant to Rule 13a-14(a) of the Securities Exchange
Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.
|
|||
31.2
|
Certification
of Margaret M. Loebl Pursuant to Rule 13a-14(a) of the Securities Exchange
Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.
|
|||
32.1
|
Certification
of Gary J. Cotshott Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|||
32.2
|
Certification
of Margaret M. Loebl Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
Exhibit
|
||
*1
|
Incorporated by reference to our Annual Report on Form 10-K for the year ended December 31, 1990,
filed as Exhibit 4.14 thereto.
|
|
*2
|
Incorporated
by reference to our Annual Report on Form 10-KSB for the year ended
December 31, 1993.
|
|
*3
|
Incorporated
by reference to our Annual Report on Form 10-K dated March 31,
2001.
|
|
*4
|
Incorporated
by reference to our Annual Report on Form 10-K dated March 18,
2003.
|
|
*5
|
Incorporated
by reference to our Report on Form 10-K dated March 24,
2004.
|
|
*6
|
Incorporated
by reference to our Annual Report on Form 10-K dated March 18,
2005.
|
|
*7
|
Incorporated
by reference to our Report on Form 10-Q dated November 9,
2006.
|
Exhibit
|
||
*8
|
Incorporated
by reference to our Report on Form 8-K dated February 9,
2007.
|
|
*9
|
Incorporated
by reference to our Annual Report on Form 10-K dated March 16,
2007.
|
|
*10
|
Incorporated
by reference to our Report on Form 8-K dated June 5,
2007.
|
|
*11
|
Incorporated
by reference to our Report on Form 10-Q dated August 9,
2007.
|
|
*12
|
Incorporated
by reference to our Report on Form 8-K dated February 14,
2008.
|
|
*13
|
Incorporated
by reference to our Report on Form 8-K dated June 5,
2008.
|
|
*14
|
Incorporated
by reference to our Report on Form 8-K dated June 11,
2008.
|
|
*15
|
Incorporated
by reference to our Report on Form 8-K dated June 18,
2008.
|
|
*16
|
Incorporated
by reference to our Report on Form 8-K dated October 7,
2008.
|
|
*17
|
Incorporated
by reference to our Annual Report on Form 10-K dated March 16,
2009.
|
|
*18
|
Incorporated
by reference to our Report on Form 10-Q dated November 9,
2009.
|
|
*19
|
Incorporated
by reference to our Report on Form 8-K dated December 15,
2009.
|
|
*20
|
Incorporated
by reference to our Report on Form 8-K dated March 29,
2010.
|
Date:
March 30, 2010
|
By:
|
/s/ Gary J. Cotshott
|
Gary
J. Cotshott
|
|
President
and Chief Executive
Officer
(Principal Executive
Officer)
|
||||
By:
|
/s/ Margaret M. Loebl
|
Margaret
M. Loebl
|
||
Corporate
Vice President, Chief Financial
Officer
and Treasurer (Principal
Financial
Officer and Principal
Accounting
Officer)
|
/s/
Gary J. Cotshott
|
Director
and Chief Executive Officer
(Principal
Executive Officer)
|
|
Gary
J. Cotshott
|
||
/s/
Margaret M. Loebl
|
Corporate
Vice President, Chief
Financial
Officer and Treasurer
(Principal
Financial Officer and Principal
Accounting
Officer)
|
|
Margaret
M. Loebl
|
||
/s/
Charles Frumberg
|
Director
|
|
Charles
Frumberg
|
||
/s/
Seth W. Hamot
|
Director
|
|
Seth
W. Hamot
|
||
|
Director
|
|
James
A. Lynch
|
||
/s/
Dov H. Scherzer
|
Director
|
|
Dov
H. Scherzer
|
||
/s/
Andrew R. Siegel
|
Director
|
|
Andrew
R. Siegel
|
||
/s/
Richard R. Widgren
|
Director
|
|
Richard
R. Widgren
|
Description
|
Balance at
Beginning
of Period
|
Charged to
(Reduction of)
Costs and
Expenses
|
Deductions
|
Balance
at End
of Period
|
||||||||||||
(In
thousands)
|
||||||||||||||||
2009
|
||||||||||||||||
Allowance
for doubtful accounts
|
$ | 986 | $ | 329 | $ | — | $ | 1,315 | ||||||||
Valuation
allowance for deferred taxes
|
$ | 1,639 | $ | (476 | ) | $ | — | $ | 1,163 | |||||||
2008
|
||||||||||||||||
Allowance
for doubtful accounts
|
$ | 611 | $ | 375 | $ | — | $ | 986 | ||||||||
Valuation
allowance for deferred taxes
|
$ | 503 | $ | 1,136 | $ | — | $ | 1,639 | ||||||||
2007
|
||||||||||||||||
Allowance
for doubtful accounts
|
$ | 466 | $ | 145 | $ | — | $ | 611 | ||||||||
Valuation
allowance for deferred taxes
|
$ | 290 | $ | 213 | $ | — | $ | 503 |
Exhibit
Number
|
Exhibit
|
|
10.32
|
Retention
and Change of Control of David A. Kriegman, dated October 23,
2009.
|
|
21.1
|
List
of subsidiaries to TechTeam Global, Inc.
|
|
23.1
|
Consent
of Independent Registered Public Accounting Firm.
|
|
31.1
|
Certification
of Gary J. Cotshott Pursuant to Rule 13a-14(a) of the Securities Exchange
Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.
|
|
31.2
|
Certification
of Margaret M. Loebl Pursuant to Rule 13a-14(a) of the Securities Exchange
Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002.
|
|
32.1
|
Certification
of Gary J. Cotshott Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
32.2
|
Certification
of Margaret M. Loebl Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|