8-K/A

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K/A

(Amendment No. 1)

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 22, 2015

Cartesian, Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-34006	48-1129619
(State or other jurisdiction of	(Commission	(I.R.S. Employer
incorporation)	File Number)	Identification No.)

7300 College Boulevard, Suite 302

Overland Park, Kansas 66210

(Address of principal executive office)(Zip Code)

(913) 345-9315

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Explanatory Note

This Amendment No. 1 on Form 8-K/A (“Amendment”) is being filed to amend and supplement the Current Report on Form 8-K filed by Cartesian, Inc. (the “Company”) with the Securities and Exchange Commission on July 23, 2015 (the “Initial Form 8-K”), in order to include financial statements and pro forma financial information permitted to be excluded from the Initial Form 8-K and filed by amendment to the Initial Form 8-K. As previously reported in the Initial Form 8-K, the Company acquired all of the outstanding capital stock of Farncombe France SARL, an entity formed under the laws of France, and Farncombe Technology Limited, a company incorporated and registered in England and Wales (which includes its wholly-owned subsidiary, Farncombe Engineering Services Limited, a company incorporated and registered in England and Wales) (collectively, the “Farncombe Entities”). Farncombe Engineering Services Limited became a wholly-owned subsidiary of Farncombe Technology Limited immediately prior to the Closing of the acquisition of Farncombe Technology Limited by Cartesian. This Amendment provides the audited historical financial statements of the Farncombe Entities pursuant to Item 9.01(a) of Form 8-K and the unaudited pro forma financial information required by Item 9.01(b) of Form 8-K. Except for the filing of such financial statements, pro forma financial information and the accompanying consents of independent accountants, this Amendment does not modify or update the Initial Form 8-K.

The aggregate amount of purchase consideration paid at the Closing of the acquisition of the Farncombe Entities consisted of cash in the amount of £654,093 pounds sterling (approximately US$1.0 million based on an exchange rate of £1.556= US$1.00 as of July 21, 2015) and 588,567 shares of Company Common Stock. Additional consideration is payable upon determination of the net working capital of the Farncombe Entities and is expected to equal at least £654,093 pounds sterling (approximately US$1.0 million based on an exchange rate of £1.556= US$1.00 as of July 21, 2015), and will be adjusted as provided in the Purchase Agreement based upon the relative amounts of the net working capital of the Farncombe Entities as of May 31, 2015 and as of Closing and as compared to the target amount of net working capital specified in the Purchase Agreement.

Item 9.01 Financial Statements and Exhibits.

(a) Financial statements of businesses acquired.

The audited financial statements of Farncombe France SARL, an entity formed under the laws of France, Farncombe Technology Limited, a company incorporated and registered in England and Wales and Farncombe Engineering Services Limited, a company incorporated and registered in England and Wales for the year ended December 31, 2014 are attached hereto as Exhibit 99.2, 99.3 and 99.4, respectively and incorporated in their entirety herein by reference.

The financial statements of Farncombe Technology Limited and Farncombe Engineering Services Limited were prepared in accordance with accounting principles generally accepted in the United Kingdom (“UK GAAP”) and the financial statements of Farncombe France SARL were prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board, both of which differ in certain respects from U.S. GAAP. The differences in accounting treatment between UK GAAP and IFRS, on the one hand, and U.S. GAAP, on the other hand, applicable to the Farncombe Entities are described in the notes to the unaudited pro forma combined condensed financial statements attached hereto as Exhibit 99.5.

(b) Pro forma financial information.

The required pro forma combined condensed balance sheet as of July 4, 2015 and unaudited pro forma combined condensed statements of income for the fiscal year ended January 3, 2015 and the twenty-six weeks ended July 4, 2015 are attached hereto as Exhibit 99.5 and are incorporated in its entirety herein by reference.

(d) Exhibits

The following exhibits are filed as part of this Amendment.

Exhibit Number	Description
23.1	Consent of SVP Associates, Limited, Independent Public Accounting Firm, United Kingdom
23.2	Consent of Cabinet NAC, Independent Public Accounting Firm, France
99.2	Audited financial statements of Farncombe France SARL as of and for the year ended December 31, 2014 and Report of Independent Auditors therein.
99.3	Audited financial statements of Farncombe Technology Limited as of and for the year ended December 31, 2014 and Report of Independent Auditors therein.
99.4	Audited financial statements of Farncombe Engineering Services Limited as of and for the year ended December 31, 2014 and Report of Independent Auditors therein.
99.5	Unaudited pro forma combined condensed balance sheet as of July 4, 2015 and unaudited pro forma combined condensed statements of income for the fiscal year ended January 3, 2015 and the twenty-six weeks ended July 4, 2015.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

CARTESIAN, INC.
By:	/s/ Thurston K. Cromwell
	Thurston K. Cromwell   General Counsel and Secretary

Date: October 7, 2015

EXHIBIT INDEX

Exhibit No.	Description
23.1	Consent of Consent of SVP Associates, Limited, Independent Public Accounting Firm, United Kingdom
23.2	Consent of Cabinet NAC, Independent Public Accounting Firm, France
99.2	Audited financial statements of Farncombe France SARL as of and for the year ended December 31, 2014 and Report of Independent Auditors therein.
99.3	Audited financial statements of Farncombe Technology Limited as of and for the year ended December 31, 2014 and Report of Independent Auditors therein.
99.4	Audited financial statements of Farncombe Engineering Services Limited as of and for the year ended December 31, 2014 and Report of Independent Auditors therein.
99.5	Unaudited pro forma combined condensed balance sheet as of July 4, 2015 and unaudited pro forma combined condensed statements of income for the fiscal year ended January 3, 2015 and the twenty-six weeks ended July 4, 2015.

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference into the previously filed Registration Statements on Form S-3 (File No. 333-198093) and Form S-8 (File Nos. 333-37304, 333-74940, 333-114979, 333-123948, 333-137869, 333-158500, 333-187619, and 333-195046, 333-203407 and 333-207136) of Cartesian, Inc., of our reports dated September 29, 2015 relating to the financial statements of Farncombe Technology Limited and Farncombe Engineering Services Limited as of and for the year ended December 31, 2014, which appears in the Current Report on Form 8-K/A of Cartesian, Inc. dated October 7, 2015.

/s/ SVP Associates Limited

SVP Associates Limited

Chartered Certified Accountants

Harpenden, United Kingdom

29 September, 2015

EX-23.2

Exhibit 23.2

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference into the previously filed Registration Statements on Form S-3 (File No. 333-198093) and Form S-8 (File Nos. 333-37304, 333-74940, 333-114979, 333-123948, 333-137869, 333-158500, 333-187619, and 333-195046, 333-203407 and 333-207136) of Cartesian, Inc., of our report dated October 5, 2015 relating to the financial statements of Farncombe France SARL as of and for the year ended December 31, 2014, which appears in the Current Report on Form 8-K/A of Cartesian, Inc. dated October 7, 2015.

Paris, France

October 5, 2015

Cabinet NAC

/s/ Samuel Najarian

Samuel Najarian

EX-99.2

Exhibit 99.2

Farncombe France SARL

Financial accounts

As of ended December 31, 2014

    Cabinet NAC SARL 33, rue de Miromesnil – 75008 Paris - France Tel : +33 1 53 30 73 30 / Fax : +33 1 53 30 73 31 contact@nacaudit.com       

Farncomb France SARL

To the shareholders

243 rue de Vaugirard

75015 Paris

Paris, October 5^th, 2015

Independent Auditors’ Report

To the Board of France Farncombe SARL,

In accordance with our engagement letter dated of May 04, 2015 and the complementary engagement letter on September 21, 2015; we have audited the accompanying financial statements of Farncombe France SARL for the year ended 31 December 2014, which comprise the Balance Sheet, the related Profit and Loss Account, and Cash Flows.

This report has been performed according the acquisition project from Cartesian of Farncombe France entity’s shares.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in France and with International Standards on Auditing (ISA); this includes the design, implementation, and maintenance of Internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatements, whether due to fraud or error.

Our responsibility is to express an opinion on the financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in France and in accordance with the US GAAS standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements.

2/12

Auditors' Responsibility

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the assessment of the risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's Internal Control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above presents fairly, in all material respects, the financial position of Farncombe France SARL as of December 31, 2014, and the profits of their operations and their cash flows for the years then ended in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (IASB).

Cabinet NAC

/s/ Samuel Najarian

3/12

Balance sheet as of December 31, 2014

In Thousands of euros			As at  Dec 31, 2014
Non-Current assets
Fixtures, fittings and equipment	(1.2	)		2,0
				2,0
Current assets
Trade debtors	(1.3	)		624,0
Rent deposit	(1.4	)		9,6
VAT assets	(1.5	)		79,2
Loan to Farncombe Technologie	(1.11	)		98,9
Cash at bank and in hand	(1.6	)		175,4
				987,1
Creditors : due within one year
Trade creditors	(1.8	)		129,6
PAYE & NI	(1.9	)		143,6
VAT Liability	(1.5	)		75,3
Accruals(1.9)	27,0
Other creditors	(1.10	)		5,4
Shareholders current account	(1.11	)		6,0
				386,9
Net current assets				600,2
Total assets less current liabilties				602,2
Income Tax (+receivable/-debt)	(1.5	)		40,8
Deferred taxation				0
Net assets				643,0
Equity
Called up share capital	(1.7	)		377,5
Profit and loss account				265,5
Shareholders’ funds				643,0

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Profit & Loss as of December 31, 2014

In Thousands of euros			As at Dec 31, 2014
Revenue
Third party sales				1 373,3
Interdivisional sales				364,0
TOTAL REVENUE	(1.12	)		1 737,3
Cost of sales
Third party cost of sales				452,9
Interdivisional cost of sales				202,9
Gross profit/(loss)				1 081,5
Administrative expenses	(1.13	)		168,7
Tax expenses	(1.13	)		11,7
Salaries, wages	(1.13	)		609,0
Operating Profit/(loss)	(1.15	)		292,1
Depreciation				0,5
Profit (-) / Loss(+) on disposal of fixed assets (1.14)				2,3
Interest				0,2
Gain & Lost exchange
Profit/(Loss) on ordinary activities before taxation				289,1
Tax on profit/(loss) on ordinary activities (1.15)				23,6
Profit/(Loss) on ordinary activities after taxation				265,5

5/12

Statement of Cash Flows

In thousands of euros	Dec 31, 2014
Cash flow from operating activities
Operating (loss)/profit		265,5
Reconciliation to cash generated from operations:
Depreciation		0,5
Decrease/(increase) in debtors		-331,8
(Decrease)/increase in creditors		79,2
		13,4
Investing activities
Purchase of intangible fixed assets		-1,9
Proceeds from sale of tangible fixed assets -		2,3
		0,4
Financing activities
Interest paid		-0,2
Tax paid		23,6
Dividends paid -		0
		23,4
Net increase/(decrease) in cash		37,2
Cash at bank and in hand less overdrafts at 1 January		138,2
Cash at bank and in hand less overdrafts at 31 December		175,4
Consisting of:
Cash at bank and in hand		175,4

6/12

Disclosures

The total of balance sheets represents 643,0 thousands of euros, and the result of the year represents 265,5 thousand of euros with a total of turnover of 1.737,3 thousand of euros.

1.1 Summary of significant accounting policies

Basis of Accounting

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in France and IFRS. No major adjustment has been identified between French GAAP and IFRS.

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Turnover

Turnover represents the value, net of value added tax and discounts, of goods provided to customers and work carried out in respect of services provided to customers.

Fixed assets

Property and equipment are stated at cost.

Expenditures for repairs and maintenance are charged to expense as incurred.

For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any related gain or loss is reflected in income for the period.

Depreciation

Depreciation has been provided at the following rates in order to write off the assets over their estimated useful lives.

Tangible assets: 3 years straight-line

Deferred taxation

Full provision is made for deferred taxation resulting from timing differences between the recognition of gains and losses in the accounts and their recognition for tax purposes.

Deferred taxation is calculated on an un-discounted basis at the tax rates which are expected to apply in the periods when the timing differences will reverse.

As the end of the year ended December 31, 2014, no deferred tax has been booked, as the management has not identified any specific deferred tax.

Pension

No pension has been estimated or booked in the entries. The staff is young and new, so the total amount to be booked would be not material.

7/12

1.2 Non-current assets

In thousands of euros	Dec 31, 2013		+		-		Dec 31, 2014
Tangible assets		6,5		1,9		2,6		5,8
Amortization of tangible assets		-3,7		-0,5		-0,4		-3,8
Total		2,8		1,4		2,2		2,0

1.3 Accouts receivables

In thousands of euros	Dec 31, 2014 (A)
Accounts receivables		614,0
AR – to be billed		10,0

1.4  Rent deposit

In thousand of euros	Dec 31, 2013		+		-		Dec 31, 2014
Rent deposit		9,8		0		0,2		9,6
Total Rent deposit		9,8		0		0,2		9,6

The financial assets are the guarantee given for the office’s rental. This amount is in accordance with the contract signed with the owner and with the yearly adjustment.

1.5 Tax

In thousands of euros (- debit + credit)	Dec 31, 2014
VAT to be paid		-75,3
VAT to be received		79,2
Income TAX		40,8
Total Tax		44,7

VAT to be paid or to be receied

The VAT in France represents 20% tax on products.

The VAT on receivables should be paid when the receivable has been received. The same position for the VAT to be paid, the payment will be done when the payables have been paid.

Income tax

Income tax represents in France 15% for the first 38.120 euro of benefits. After this level, the rate is 33,33%.

The amount of the income tax for the year 2014 is 91,5 thousand of euros.

The government propose a reduction for companies who invest in the research of new technology called Tax credit on research (Crédit impôt Recherche - CIR)

8/12

For information, this credit for the year 2012 for a total of 40,9 thousand of euros has not received yet. The local manager has obtained the following information that the file is approved by the tax department, and the amount is in process, and should be paid.

The risk, in case of control is the total amount of CIR for the year 2012, 2013, and 2014, which represent a total of amount of 156,0 thousand of euros.

1.6 Cash

In thousands of euros	Dec 31, 2014 (A)
Bank accounts		175,4
Total		175,4

1.7 Shareholders’ equity

In thousands of euros	Dec 31, 2013		Results of the year		Other		Dec 31, 2014
Equity		2,0						2,0
Legal report		0,2						0,2
Report		171,3		204,1				375,4
Net income of the year		204,1		-204,1		265,5		265,5
Total		377,6		0,0		265,5		643,1

The nominal value of the shares is ONE euros. The number of shares is: 2.000.

1.8 Accounts Payables

In thousands of euros	Dec 31, 2014 (A)
Accounts payables		115,3
AP – To be received		14,3
Total AP		129,6

1.9 Social tax

In thousands of euros (- debit + credit)	Dec 31, 2014
Salaries		0,1
Accruals vacations		27,0
Social Tax		89,3
Bonus		15,1
Accruals Social tax - manager		39,1
Total social tax		170,6

9/12

Accruals – vacations

The evaluation at year end of this provision is in accordance with French law.

Management Social tax

The manager wages for the year 2014 represent 106,4 thousand of euros, and social tax related to its wages represent 37,4 thousand of euros. The total cost for the manager is 143,8 thousand of euros for the year 2014.

To be noted that when managers (gérant) hold more than 50% of shares of the company, the treatment of their social tax is independent from the employees.

1.10 Other payables

In thousands of euros (- debit + credit)	Dec 31, 2014
Others		- 5,4
Total		- 5,4

1.11 Shareholders’ accounts

In thousands of euros (- debit + credit)	Dec 31, 2014
C/C Lionel Tranchard		- 6,0
Farncomb Technologie		98,9
Total		92,9

1.12 Revenue and margin

In thousands of euros	Dec 31, 2014
Revenue
Third party sales		1 373,3
Interdivisional sales		364,0
TOTAL REVENUE		1 737,3

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Gross profit

In thousands of euros	Dec 31, 2014
TOTAL REVENUE		1 737,3
Third party cost of sales		452,9
Interdivisional cost of sales		202,9
Gross profit/(loss)		1 081,5

Increase of the gross profit is mainly due to the business realized with the Farncomb Group.

1.13 Operating profit

In thousands of euros	Dec 31, 2014
		K €
Administrative expenses		168,7
Tax expenses		11,7
Salaries, wages		609,0
Operating profit		292,1

Administrative expenses

In thousands of euros	Dec 31, 2014
Office rental		41,2
Outpocket expenses		96,1
Fees		10
Telecom		7,1
Bank fees		3,8
Other		10,5
Total		168,7

Tax expenses

In thousands of euros	Dec 31, 2014
Employee tax		3,1
Rental tax		3,9
Other tax		0,6
Total		11,7

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Salaries, wages

In thousands of euros	Dec 31, 2014
Employees salaries		329,3
Employees salaries tax		123,7
Management salaries		106,4
Management salaries tax		49,5
Total		609,0

Farncombe France SARL hires 6 employees which represent a global cost of 452 thousand of euros.

The 2 managers’ wages represents a total of 155 thousands euros by the year.

1.14 Exceptional result

In thousands of euros	Dec 31, 2014
Exceptional result		-2,3

1.15 Tax income

In thousands of euros	Dec 31, 2014
Tax income		90,1
Credit tax income		-66,5
Total		23,6

1.16 Net income

In thousands of euros	Dec 31, 2014
	K €
Profit/(Loss) on ordinary activities before taxation		289,1
Tax on profit/(loss) on ordinary activities		23,6
Profit/(Loss) on ordinary activities after taxation		265,5

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EX-99.3

Exhibit 99.3

Registered number

05997790

Farncombe Technology Limited

Report and Accounts

31 December 2014

Farncombe Technology Limited

Statement of Directors' Responsibilities

The directors are responsible for preparing the report and accounts in accordance with applicable law and regulations.

Company law requires the directors to prepare accounts for each financial year. Under that law the directors have elected to prepare the accounts in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law) and FRS102 applicable to small entities. Under company law the directors must not approve the accounts unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these accounts, the directors are required to:

● select suitable accounting policies and then apply them consistently;

● make judgements and estimates that are reasonable and prudent;

● prepare the accounts on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the accounts comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

1

Farncombe Technology Limited

Independent auditors' report

To the Board of Directors and Shareholders

We have audited the accompanying financial statements of Farncombe Technology Limited, which comprise the Balance Sheet as of 31 December 2014, and the related Profit and Loss Account and cash flow for the year then ended.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United Kingdom; this includes the design, implementation, and maintenance of Internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatements, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on the financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the assessment of the risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's Internal Control. Accordingly, we express no such opinion. An audit also includes evaluationg the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above presents fairly, in all material respects, the financial position of Farncombe Technology Limited at 31 December 2014, and the profits of their operations and their cash flows for the years then ended in accordance with accounting principles generally accepted in United Kingdom and FRS102 applicable to small entities.

/s/ SVP Associates Limited

SVP Associates Limited

Certified Accountants and Registered Auditors

First Floor, 2 Victoria Road

Harpenden

Hertfordshire AL5 4EA

29 September 2015

2

Farncombe Technology Limited

Statement of Income

for the year ended 31 December 2014

	Notes		2014
			£
Revenue				2,602,187
Cost of sales				(2,191,520	)
Gross profit				410,667
Administrative expenses				(872,350	)
Inter-company management charge				621,902
Operating profit/(loss)		3		160,219
Finance costs		4		(13,453	)
Profit/(loss) on ordinary activities before taxation				146,766
Tax on profit/(loss) on ordinary activities		5		(30,416	)
Profit/(loss) for the financial year				116,350
Retained earnings at 1 January 2014				415,054
Retained earnings at 31 December 2014				531,404

3

Farncombe Technology Limited

Statement of Other Comprehensive Income

for the year ended 31 December 2014

	2014
	£
Profit/(loss) for the financial year		116,350
Total recognised gains and losses related to the year		116,350

4

Farncombe Technology Limited

Statement of Financial Position

as at 31 December 2014

	Notes				2014
Non current assets						£
Intangible assets		6				48,502
Leasehold property and equipment		7				75,175
Financial Assets		8				200
						123,877
Current assets
Trade and other receivables		9	1,529,728
Cash and cash equivalents			281,543
			1,811,271
Creditors: amounts falling due within one year		10	(1,361,761	)
Net current assets						449,510
Total assets less current liabilities						573,387
Provisions for liabilities		11				(10,066	)
Net assets						563,321
Equity
Called up share capital		12				31,917
Profit and loss account		13				531,404
Shareholders' funds						563,321

5

Farncombe Technology Limited

Statement of changes in equity

as at 31 December 2014

	Share		Share		Retained
	Capital		Premium		earnings		Total
	£		£		£		£
Balance at 1 January 2014 as previously reported		31,917		-		415,054		446,971
Prior period adjustment		-		-		-		-
Shares issued in the year		-		-		-		-
Profit for the year		-		-		116,350		116,350
Dividends		-		-		-		-
Other comprehensive income for the year		-		-		-		-
Balance as 31 December 2014		31,917		-		531,404		563,321

6

Farncombe Technology Limited

Statement of Cash Flows

for the year ended 31 December 2014

	2014
	£
Cash flow from operating activities
Operating profit		160,219
Reconciliation to cash generated from operations:
Depreciation		25,949
Amortisation of goodwill		81,761
Increase in debtors		(86,932	)
Increase in creditors		70,308
		251,305
Investing activities
Interest received		-
Issue of shares for cash		-
Purchase of intangible fixed assets		(71,960	)
Proceeds from sale of tangible fixed assets		443
		(71,517	)
Financing activities
Interest paid		(13,453	)
Tax paid		(238	)
Dividends paid		-
		(13,691	)
Net increase/(decrease) in cash		166,097
Cash at bank and in hand less overdrafts at 1 January		115,446
Cash at bank and in hand less overdrafts at 31 December		281,543
Consisting of:
Cash at bank and in hand		281,543

7

Farncombe Technology Limited

Notes to the Accounts

for the year ended 31 December 2014

1 Statutory information

Farncombe Techonolgy Limited is a company domicled in England and Wales, registeration number 05997790. The registered office is Grove House, Lutyens Close, Chinham Court, Basingstoke, England RG24 8AG.

2 Compliance with accounting standards

Basis of preparation

The accounts have been prepared in accordance with the provisions of FRS 102 applicable to small entities.

Turnover

Turnover represents the value, net of value added tax and discounts, of goods provided to customers and work carried out in respect of services provided to customers.

Depreciation

Depreciation has been provided at the following rates in order to write off the assets over their estimated useful lives.

Plant and machinery	33% straight line & 25% reducing balance
Leasehold property	over period of 5 year lease

Deferred taxation

Full provision is made for deferred taxation resulting from timing differences between the recognition of gains and losses in the accounts and their recognition for tax purposes. Deferred taxation is calculated on an un-discounted basis at the tax rates which are expected to apply in the periods when the timing differences will reverse.

Foreign currencies

Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date. All differences are taken to the profit and loss account.

Leasing and hire purchase commitments

Assets held under finance leases and hire purchase contracts, which are those where substantially all the risks and rewards of ownership of the asset have passed to the company, are capitalised in the balance sheet and depreciated over their useful lives. The corresponding lease or hire purchase obligation is treated in the balance sheet as a liability.

The interest element of the rental obligations is charged to the profit and loss account over the period of the lease and represents a constant proportion of the balance of capital repayments outstanding.

Rentals paid under operating leases are charged to income on a straight line basis over the lease term.

Pensions

The company operates a defined contribution pension scheme. Contributions are charged to the profit and loss account as they become payable in accordance with the rules of the scheme.

8

Farncombe Technology Limited

Notes to the Accounts

for the year ended 31 December 2014

3 Operating profit

	2014
	£
This is stated after charging:
Depreciation of owned fixed assets		25,949
Amortisation of goodwill		81,761
Directors' remuneration		126,107

4 Interest payable

	2014
	£
Interest payable		13,453

5 Taxation

	2014
	£
UK corporation tax		(3,456	)
Deferred tax		33,872
		30,416

6 Intangible fixed assets

Goodwill:

	£
Cost
At 1 January 2014		255,999
At 31 December 2014		255,999
Amortisation
At 1 January 2014		125,736
Provided during the year		81,761
At 31 December 2014		207,497
Net book value
At 31 December 2014		48,502

Goodwill is being written off in equal annual instalments over its estimated economic life of 5 years.

9

Farncombe Technology Limited

Notes to the Accounts

for the year ended 31 December 2014

7 Leasehold property, Plant and Equipment

	Leasehold			Fixtures &
	Property			Fittings			Total
	£			£			£
Cost
At 1 January 2014		26,516			94,909			121,425
Additions		-			71,960			71,960
Disposals		(26,516	)		(938	)		(27,454	)
At 31 December 2014		-			165,931			165,931
Depreciation
At 1 January 2014		26,516			65,302			91,818
Charge for the year		-			25,949			25,949
On disposals		(26,516	)		(495	)		(27,011	)
At 31 December 2014		-			90,756			90,756
Net book value
At 31 December 2014		-			75,175			75,175

8 Financial Assets

	Investments in subsidiary undertakings
	£
Cost
At 1 January 2014		200
At 31 December 2014		200

The company holds 20% or more of the share capital of the following companies:

Company	Shares held			Capital and reserves		Profit (loss) for the year
	Class	%		£		£
Farncombe Engineering Services Ltd	Ordinary		82.5		304,004		(50,663	)

9 Debtors

	2014
	£
Trade receivables		599,115
Amount receivable from related parties		692,271
Deferred tax asset (see note 11)		-
Other debtors and receivables		238,342
		1,529,728

10 Creditors: amounts falling due within one year

	2014
	£
Trade payables		303,872
Amounts due to related parties		539,513
Current tax liability		(3,694	)
Other taxes and social security costs		205,404
Directors loans		55,000
Accruals and other payables		261,666
		1,361,761

10

Farncombe Technology Limited

Notes to the Accounts

for the year ended 31 December 2014

11	Provisions for liabilities
	Deferred taxation:

	2014
	£
Timing differences and other deductions		10,066

	2014
	£
At 1 January		(23,806	)
Deferred tax charge/credit in profit and loss account		33,872
At 31 December		10,066

12 Share capital

	Nominal	2014		2014
	value	Number		£
Allotted, called up and fully paid:
Ordinary shares	£1.00 each		31,917		31,917

13 Profit and loss

	2014
	£
At 1 January 2014		415,054
Profit for the year		116,350
At 31 December 2014		531,404

14 Other financial commitments

	2014
	£
At the year end the company had annual commitments under non-cancellable operating leases as set out below:
Operating leases which expire:
within one year		132,131
within two to five years		3,723
		135,854

15 Average number of employees

	2014
	£
During the year average number of employees was :		17
		17

11

Farncombe Technology Limited

Notes to the Accounts

for the year ended 31 December 2014

	2014
	£
Sales		2,602,187
Cost of sales		(2,191,520	)
Gross profit		410,667
Administrative expenses		(872,350	)
Other operating income		621,902
Bad Debts		-
Operating profit/(loss)		160,219
Interest payable		(13,453	)
Profit/(loss) before tax		146,766

12

Farncombe Technology Limited

Notes to the Accounts

for the year ended 31 December 2014

	2014
	£
Sales
Sales		2,602,187
Cost of sales
Wages and salaries		754,547
Directors' salaries		126,107
Employer's NI		97,897
Pensions		15,082
Consultancy fees		1,005,060
Security specific costs		75,113
Agency fees		-
Equipment for client		3,425
Expenses incurred		114,289
Costs capitalised		-
		2,191,520
Administrative expenses
Employee costs:
Wages and salaries		112,368
Staff training and welfare		716
Travel and subsistence		61,834
Motor expenses		4,656
Entertaining		13,980
		193,554
Premises costs:
Rent		259,177
		259,177
General administrative expenses:
Telephone and fax		26,192
Stationery and printing		5,496
Foreign currency losses/(gains)		24,115
Bank charges		5,557
Insurance		45,260
IT costs		25,470
Depreciation		25,945
Disposal of assets loss/(profit)		(57	)
Amortisation of goodwill		81,761
Bad debts		42,564
Sundry expenses		2,910
		285,213
Legal and professional costs:
Accountancy fees		28,327
Advertising and PR		88,335
Other legal and professional		17,744
		134,406
		872,350
Other operating income
Inter-company management charge		621,902

13

EX-99.4

Exhibit 99.4

Registered number
06581276

Farncombe Engineering Services Limited

Report and Accounts

31 December 2014

Farncombe Engineering Services Limited

Statement of Directors' Responsibilities

The directors are responsible for preparing the report and accounts in accordance with applicable law and regulations.

Company law requires the directors to prepare accounts for each financial year. Under that law the directors have elected to prepare the accounts in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law) and FRS102 applicable to small entities. Under company law the directors must not approve the accounts unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these accounts, the directors are required to:

● select suitable accounting policies and then apply them consistently;

● make judgements and estimates that are reasonable and prudent;

● prepare the accounts on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the accounts comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

1

Farncombe Engineering Services Limited

Independent auditors' report

to the members of Farncombe Engineering Services Limited

We have audited the accompanying financial statements of Farncombe Engineering Services Limited, which comprise the Balance Sheet as of 31 December 2014, and the related Profit and Loss Account and cash flow for the year then ended.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United Kingdom; this includes the design, implementation, and maintenance of Internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatements, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on the financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the assessment of the risk of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's Internal Control. Accordingly, we express no such opinion. An audit also includes evaluationg the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements referred to above presents fairly, in all material respects, the financial position of Farncombe Engineering Services Limited at 31 December 2014, and the profits of their operations and their cash flows for the years then ended in accordance with accounting principles generally accepted in United Kingdom and FRS102 applicable to small entities.

/s/ SVP Associates Limited

SVP Associates Limited

Certified Accountants and Registered Auditors

First Floor, 2 Victoria Road

Harpenden

Hertfordshire AL5 4EA

29 September 2015

2

Farncombe Engineering Services Limited

Statement of Income

for the year ended 31 December 2014

	Notes		2014
			£
Revenue				5,508,351
Cost of sales				(4,662,482	)
Gross profit				845,869
Administrative expenses				(911,307	)
Bad Debts				(13,898	)
Rental Income				14,127
Operating loss		3		(65,209	)
Finance Income				21,139
Finance costs		4		(2,141	)
Loss on ordinary activities before taxation				(46,211	)
Tax on loss on ordinary activities		5		23,306
Loss for the financial year				(22,905	)
Retained earnings  at 1 January 2014				348,992
Retained earnings at 31 December 2014				326,087

3

Farncombe Engineering Services Limited

Statement of Other Comprehensive Income

for the year ended 31 December 2014

	2014
	£
Loss for the financial year		(22,905	)
Total recognised gains and losses related to the year		(22,905	)

4

Farncombe Engineering Services Limited

Statement of Financial Position

as at 31 December 2014

	Notes				2014
					£
Non current assets
Intangible assets		6				54,456
Fixtures , fittings and equipment		7				12,196
						66,652
Current assets
Trade and other receivables		8	1,510,295
Cash and cash equivalents			311,302
			1,821,597
Creditors: amounts falling due within one year		9	(1,554,926	)
Net current assets						266,671
Net assets						333,323
Equity
Called up share capital		11				245
Share premium		12				6,991
Profit and loss account		13				326,087
Shareholders' funds						333,323

5

Farncombe Engineering Services Limited

Statement of changes in equity

as at 31 December 2014

	Share		Share		Retained
	Capital		Premium		earnings			Total
	£		£		£			£
Balance at 1 January 2014 as previously		243		5,432		348,992			354,667
reported Prior period adjustment		-		-		-			-
Shares issued in the		-		-		-			-
year Loss for the year		-		-		(22,905	)		(22,905	)
Dividends		-		-		-			-
Other comprehensive income for the		-		-		-			-
year Balance as 31 December 2014		243		5,432		326,087			331,762

6

Farncombe Engineering Services Limited

Statement of Cash Flows

for the year ended 31 December 2014

	2014
	£
Cash flow from operating activities
Operating (loss)/profit		(65,209	)
Reconciliation to cash generated from operations:
Depreciation		39,606
Amortisation of goodwill		93,700
Decrease/(increase) in debtors		228,305
Increase in creditors		25,990
		322,392
Investing activities
Interest received		21,139
Issue of shares for cash
Purchase of intangible fixed assets		(12,863	)
Proceeds from sale of tangible fixed assets		-
		8,276
Financing activities
Interest paid		(2,141	)
Tax paid		(46,404	)
Dividends paid		-
		(48,545	)
Net increase/(decrease) in cash		282,123
Cash at bank and in hand less overdrafts at 1 January		29,179
Cash at bank and in hand less overdrafts at 31 December		311,302
Consisting of:
Cash at bank and in hand		311,302

7

Farncombe Engineering Services

Limited Notes to the Accounts

for the year ended 31 December 2014

1 Statutory information

Farncombe Engineering Services Limited is a company domicled in England and Wales, registeration number 06581276. The registered office is Grove House, Lutyens Close, Chinham Court, Basingstoke, England RG24 8AG.

2 Compliance with accounting standards

Basis of preparation

The accounts have been prepared in accordance with the provisions of FRS 102 applicable to small entities.

Turnover

Turnover represents the value, net of value added tax and discounts, of goods provided to customers and work carried out in respect of services provided to customers.

Depreciation

Depreciation has been provided at the following rates in order to write off the assets over their estimated useful lives.

Fixtures & fittings	25% reducing balance
Equipment	33% straight line

Deferred taxation

Full provision is made for deferred taxation resulting from timing differences between the recognition of gains and losses in the accounts and their recognition for tax purposes. Deferred taxation is calculated on an un-discounted basis at the tax rates which are expected to apply in the periods when the timing differences will reverse.

Foreign currencies

Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date. All differences are taken to the profit and loss account.

Leasing and hire purchase commitments

Assets held under finance leases and hire purchase contracts, which are those where substantially all the risks and rewards of ownership of the asset have passed to the company, are capitalised in the balance sheet and depreciated over their useful lives. The corresponding lease or hire purchase obligation is treated in the balance sheet as a liability.

The interest element of the rental obligations is charged to the profit and loss account over the period of the lease and represents a constant proportion of the balance of capital repayments outstanding.

Rentals paid under operating leases are charged to income on a straight line basis over the lease term.

Pensions

The company operates a defined contribution pension scheme. Contributions are charged to the profit and loss account as they become payable in accordance with the rules of the scheme.

8

Farncombe Engineering Services

Limited Notes to the Accounts

for the year ended 31 December 2014

3 Operating profit

	2014
	£
This is stated after charging:
Depreciation of owned fixed assets		39,606
Amortisation of goodwill		93,700

4 Interest payable

	2014
	£
Interest payable		2,141

5 Taxation

	2014
	£
UK corporation tax		(15,378	)
Deferred tax		(7,928	)
		(23,306	)

6	Intangible fixed assets
	Goodwill:

	£
Cost
At 1 January 2014		468,503
At 31 December 2014		468,503
Amortisation
At 1 January 2014		320,347
Provided during the year		93,700
At 31 December 2014		414,047
Net book value
At 31 December 2014		54,456

9

Farncombe Engineering Services

Limited Notes to the Accounts

for the year ended 31 December 2014

7 Plant and Equipment

	Fixtures &
	Fittings		Equipment		Total
	£		£		£
Cost
At 1 January 2014		3,890		123,316		127,206
Additions		-		12,863		12,863
At 31 December 2014		3,890		136,179		140,069
Depreciation
At 1 January 2014		973		87,294		88,267
Charge for the year		729		38,877		39,606
At 31 December 2014		1,702		126,171		127,873
Net book value
At 31 December 2014		2,188		10,008		12,196

8 Debtors

	2014
	£
Trade receivables		938,321
Amount receivable from related parties		485,881
Deferred tax asset (see note 10)		35,245
Other debtors		50,848
		1,510,295

9 Creditors: amounts falling due within one year

	2014
	£
Trade payables		375,810
Amounts due to related parties		820,990
Current tax liability		(15,378	)
Other taxes and social security costs		57,176
Directors loans		21,568
Accruals and other payables		294,760
		1,554,926

10

Farncombe Engineering Services

Limited Notes to the Accounts

for the year ended 31 December 2014

10	Provisions for liabilities
	Deferred taxation:

	2014
	£
Timing differences and other deductions		(35,245	)

	2014
	£
At 1 January		(27,317	)
Deferred tax charge/credit in profit and loss account		(7,928	)
At 31 December		(35,245	)

11 Share capital

	Nominal	2014		2014
	value	Number		£
Allotted, called up and fully paid:
Ordinary shares	£0.01 each		24,306		245

	Nominal	Number		Amount
	value			£
Shares issued during the period:
Ordinary shares	£0.01 each		-		2

12 Share premium

	2014
	£
At 1 January 2014		5,432
Shares issued		1,559
At 31 December 2014		6,991

13 Profit and loss

	2014
	£
At 1 January 2014		348,992
Loss for the year		(22,905	)
At 31 December 2014		326,087

14 Other financial commitments

	2014
	£
At the year end the company had annual commitments under non- cancellable operating leases as set out below:
Operating leases which expire: within two to five years		7,900

11

Farncombe Engineering Services

Limited Notes to the Accounts

for the year ended 31 December 2014

15 Average number of employees

	2014
	£
During the year average number of employees was :		30
		30

12

Farncombe Engineering Services Limited

Detailed profit and loss account

for the year ended 31 December 2014

	2014
	£
Sales		5,508,351
Cost of sales		(4,662,482	)
Gross profit		845,869
Administrative expenses		(911,307	)
Other operating income		14,127
Bad Debts		(13,898	)
Operating loss		(65,209	)
Interest receivable		21,139
Interest payable		(2,141	)
Loss before tax		(46,211	)

13

Farncombe Engineering Services Limited

Detailed profit and loss account

for the year ended 31 December 2014

	2014
	£
Sales
Sales		5,508,351
Cost of sales
Wages and salaries		1,468,055
Directors' salaries		144,887
Employer's NI		187,237
Pensions		11,454
Consultancy fees		2,545,672
Expenses incurred		207,380
Equipment for re-sale		42,252
Wifi and Pos costs		55,545
		4,662,482
Administrative expenses
Employee costs:
Travel and subsistence		75,612
Entertaining		2,719
		78,331
Premises costs:
Re-location costs		-
		-
General administrative expenses:
Telephone and fax		328
Stationery and printing		721
Foreign currency losses/(gains)		3,697
Bank charges		611
Re-charge from FT		621,902
IT costs		-
Depreciation		39,606
Amortisation of goodwill		93,700
Sundry expenses		14,157
		774,722
Legal and professional costs:
Accountancy fees		25,657
Advertising and PR		13,526
Other legal and professional		19,071
		58,254
		911,307
Other operating income
Rental Income		14,127

14

EX-99.5

Exhibit 99.5

UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS

The following unaudited pro forma combined condensed balance sheet as of July 4, 2015 and unaudited pro forma combined condensed statements of operations for the fiscal year ended January 3, 2015 and the twenty-six weeks ended July 4, 2015, are based on the historical financial statements of Cartesian, Inc. (“Cartesian” or the “Company”), and Farncombe France SARL, Farncombe Technology Limited, and its wholly-owned subsidiary, Farncombe Engineering Services Limited (collectively, “the Farncombe Entities”) after giving effect to Cartesian’s acquisition of the Farncombe Entities on July 22, 2015 (the “Farncombe Acquisition”), as more fully described in the Explanatory Note of this Form 8-K/A and applying the assumptions and adjustments described in the accompanying notes to the unaudited pro forma combined condensed financial statements. Farncombe Engineering Services Limited became a wholly-owned subsidiary of Farncombe Technology Limited immediately prior to the closing of the acquisition of Farncombe Technology Limited by Cartesian.

The unaudited pro forma combined condensed balance sheet and unaudited pro forma combined condensed statements of operations, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with, Cartesian’s historical consolidated financial statements included in its Annual Report on Form 10-K for the fiscal year ended January 3, 2015 and its Quarterly Report on Form 10-Q for the fiscal period ended July 4, 2015, as well as the Farncombe Entities historical financial statements for the year ended December 31, 2014 which are included as Exhibits 99.2, 99.3 and 99.4 to this Form 8-K/A. This unaudited pro forma information should also be read in conjunction with Cartesian’s Form 8-K related to its acquisition of the Farncombe Entities, filed with the Securities and Exchange Commission (“SEC”) on July 23, 2015.

The following unaudited pro forma combined condensed statements of operations are presented as if the Farncombe Acquisition had occurred at the beginning of the fiscal year on December 29, 2013 and include all adjustments that give effect to events that are directly attributable to the transaction, are expected to have a continuing impact, and that are factually supportable. The following unaudited pro forma combined condensed balance sheet is presented as if the Farncombe Acquisition had occurred as of July 4, 2015 and includes all adjustments that give effect to events that are directly attributable to the transaction, and that are factually supportable.

The financial statements of Farncombe Technology Limited and Farncombe Engineering Services Limited (“Farncombe UK”) were prepared in accordance with accounting principles generally accepted in the United Kingdom (“UK GAAP”) and the financial statements of Farncombe France SARL were prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”), both of which differ in certain respects from U.S. GAAP. Adjustments have been made to reconcile the Farncombe Entities' financial statements to U.S. GAAP for the purposes of the unaudited pro forma presentation as described in the accompanying notes. A description of reconciling amounts between U.S. GAAP and UK GAAP are included in the accompanying notes.

The financial statements of Farncombe UK were originally prepared using pounds sterling as the reporting currency, and the financial information in those financial statements has been translated into U.S. dollars for the purposes of the unaudited pro forma presentation as described in Note 1. The financial statements of Farncombe France SARL (“Farncombe France”) were originally prepared using the Euro as the reporting currency and the financial information in those financial statements has been translated into U.S. dollars for the purposes of the unaudited pro forma presentation as described in Note 1.

Cartesian reports its operating results on a 52/53-week fiscal year basis. The fiscal year end is determined as the Saturday ending nearest December 31. The Farncombe Entities report their operating results on a calendar year basis and their results are included in the unaudited pro forma combined condensed financial statements based on their fiscal year. The difference in fiscal periods is not considered material to the unaudited pro forma combined condensed financial statements.

The Farncombe Acquisition has been accounted for under the acquisition method of accounting under U.S. GAAP. Under the acquisition method of accounting, the total estimated purchase price, calculated as described in Note 1 to these unaudited pro forma combined condensed balance sheet and statement of operations, is allocated to the net tangible and intangible assets acquired and liabilities assumed based on various estimates.

The unaudited pro forma combined condensed financial statements have been prepared by management for illustrative purposes only and are not necessarily indicative of the consolidated financial position or results of operations in future periods or the results that actually would have been realized had Cartesian and the Farncombe Entities been a combined company during the specified period. The unaudited pro forma financial information does not include the effects of any synergies that Cartesian may achieve related to the Farncombe Acquisition or the costs necessary to achieve any synergies. The unaudited pro forma financial information also does not include costs for integrating Cartesian and the Farncombe Entities. The unaudited pro forma financial information is preliminary and based on currently available information, assumptions and adjustments that are subject to change.

CARTESIAN, INC.

PRO FORMA COMBINED CONDENSED BALANCE SHEET

As of July 4, 2015 (Unaudited)

(In thousands)

								Pro Forma
								Combined
			Historical					Including
	Cartesian		Farncombe		Pro Forma			Farncombe
	As Reported		Entities		Adjustments			Entities
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	11,054	$	1,485	$	(1,017	)B	$	11,522
Accounts receivable, net		11,935		8,982		-			20,917
Inventory		2,700		-		-			2,700
Prepaid and other current assets		1,633		331		-			1,964
Total current assets		27,322		10,798		(1,017	)		37,103
NONCURRENT ASSETS:
Property and equipment, net		2,528		107		-			2,635
Goodwill		8,018		12		(12	)A		10,121
						2,103	C
Intangible assets, net		-				1,190	C		1,190
Deferred income tax assets		835		-		-			835
Other noncurrent assets		487		-		-			487
Total Assets	$	39,190	$	10,917	$	2,264		$	52,371
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Trade accounts payable	$	2,650	$	5,735	$	-		$	8,385
Current borrowings		3,269		-		-			3,269
Liabilities for derivatives		442		-		-			442
Accrued payroll, bonuses and related expenses		3,952		349		-			4,301
Accrued severance liability and related costs		-		-		-			0
Deferred revenue		1,639		-		-			1,639
Other accrued liabilities		1,431		2,031		1,363	B		4,825
Total current liabilities		13,383		8,115		1,363			22,861
NONCURRENT LIABILITIES:
Deferred income tax liabilities		782		-		-			782
Deferred revenue		911		-		-			911
Other noncurrent liabilities		614		-		1,667	E		2,281
Total noncurrent liabilities		2,307		-		1,667			3,974
Total stockholders’ equity		23,500		2,802		(2,802	)A		25,536
						2,036	B
Total Liabilities and Stockholders’ Equity	$	39,190	$	10,917	$	2,264		$	52,371

See notes to unaudited pro forma combined condensed financial statements.

CARTESIAN, INC.

PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS

For the fiscal year ended January 3, 2015 (Unaudited)

(In thousands, except per share data)

										Pro Forma
										Combined
				Historical						Including
	Cartesian			Farncombe			Pro Forma			Farncombe
	As Reported			Entities			Adjustments			Entities
Revenues	$	71,675		$	14,362					$	86,037
Cost of services		45,088			10,872						55,960
Gross profit		26,587			3,490						30,077
Selling, general and administrative expenses (includes non-cash share-based compensation expense of $334 and $205 for the fourteen weeks ended January 3, 2015 and for the thirteen weeks ended December 28, 2013, respectively and $1,057 and $737 for the fifty-three weeks ended January 3, 2015 and for the fifty-two weeks ended December 28, 2013, respectively)		27,468			2,893			362	C		30,723
Loss from operations		(881	)		597			(362	)		(646	)
Other (expense) income
Interest (expense) income, net		(200	)		9						(191	)
Discount on note payable and transaction costs		(1,610	)		-						(1,610	)
Change in fair value of warrants and derivative liabilities		159			-						159
Other expense		-			(3	)					(3	)
Total other income (expense)		(1,651	)		6						(1,645	)
Loss before income taxes		(2,532	)		603			(362	)		(2,291	)
Income tax (provision) benefit		1,121			(31	)		80	F		1,170
Net Loss	$	(1,411	)	$	572		$	(282	)	$	(1,121	)
Net Loss per basic common share	$	(0.18	)							$	(0.13	)
Weighted average shares used in calculation of net loss per basic common share		7,800									8,389

See notes to unaudited pro forma combined condensed financial statements.

CARTESIAN, INC.

PRO FORMA COMBINED CONDENSED STATEMENTS OF OPERATIONS

For the Twenty-Six Weeks ended July 4, 2015 (Unaudited)

(In thousands, except per share data)

										Pro Forma
										Combined
				Historical						Including
	Cartesian			Farncombe			Pro Forma			Farncombe
	As Reported			Entities			Adjustments			Entities
Revenues	$	34,939		$	8,580					$	43,519
Cost of services		22,709			6,273						28,982
Gross profit		12,230			2,307						14,537
								#DIV/0!
Selling, general and administrative expenses (includes non-cash share-based compensation expense of $334 and $205 for the fourteen weeks ended January 3, 2015 and for the thirteen weeks ended December 28, 2013, respectively and $1,057 and $737 for the fifty-three weeks ended January 3, 2015 and for the fifty-two weeks ended December 28, 2013, respectively)		15,466			1,516			136	C		16,826
								(292	)D
Loss from operations		(3,236	)		791			156			(2,289	)
Other (expense) income
Interest (expense) income, net		(108	)		-						(108	)
Change in fair value of warrants and derivative liabilities		(105	)		-						(105	)
Other expense		(47	)		19						(28	)
Total other income (expense)		(260	)		19						(241	)
Loss before income taxes		(3,496	)		810			156			(2,530	)
Income tax (provision) benefit		(290	)		(46	)		(34	)F		(370	)
Net Loss	$	(3,786	)	$	764		$	122		$	(2,900	)
Net Loss per basic common share	$	(0.47	)							$	(0.33	)
Weighted average shares used in calculation of net loss per basic common share		8,135									8,724

See notes to unaudited pro forma combined condensed financial statements.

NOTES TO PRO FORMA

COMBINED CONDENSED FINANCIAL STATEMENTS

(Unaudited)

Note 1 – Basis of Presentation

Basis of Presentation

The unaudited pro forma combined condensed statements of operations are presented as if the Farncombe Acquisition had occurred at the beginning of the fiscal year on December 29, 2013 and include all adjustments that give effect to events that are directly attributable to the transaction, are expected to have a continuing impact, and that are factually supportable. The unaudited pro forma combined condensed balance sheet is presented as if the Farncombe Acquisition had occurred as of July 4, 2015 and includes all adjustments that give effect to events that are directly attributable to the transaction, are expected to have a continuing impact, and that are factually supportable.

The financial statements of Farncombe UK were prepared in accordance with UK GAAP and the financial statements of Farncombe France SARL were prepared in accordance with IFRS as issued by the IASB, both of which differ in certain respects from U.S. GAAP. Adjustments have been made to reconcile the Farncombe Entities' financial statements to U.S. GAAP for the purposes of the unaudited pro forma presentation. These adjustments relate primarily to differences such as the accounting for accrued vacation and goodwill amortization for Farncombe UK. Under UK GAAP there is no requirement to accrue for employees’ accrued vacation entitlement. U.S. GAAP requires that certain vacation benefits be accrued. The adjustment to record accrued vacation is included in the Historical Farncombe Entities column on the accompanying combined condensed financial statements and was $22,000 and $88,000 for the fiscal year ended January 3, 2015 and the twenty-six weeks ended July 4, 2015, respectively. Goodwill is amortized under UK GAAP. U.S. GAAP prohibits the amortization of goodwill. An adjustment to eliminate goodwill amortization of approximately $175,000 and $47,000 is included in the Historical Farncombe Entities column on the accompanying combined condensed statements of operations for the fiscal year ended January 3, 2015 and the twenty-six weeks ended July 4, 2015, respectively.

The financial statements of Farncombe UK were originally prepared using pounds sterling as the reporting currency. The statement of operations information of Farncombe UK for the year ended December 31, 2014 was translated into U.S. dollars using an exchange rate of £1 = U.S. $1.647 and for the twenty-six weeks ended June 30, 2015 was translated into U.S. dollars using an exchange rate of £1 = U.S. $1.556, the average rates for each of the periods presented. The balance sheet information was translated into U.S. dollars using an exchange rate of £1 = U.S. $1.560, the rate at July 4, 2015.

The financial statements of Farncombe France were originally prepared using the Euro as the reporting currency. The statement of operations information of Farncombe France for the year ended December 31, 2014 was translated into U.S. dollars using an exchange rate of Euro 1 = U.S. $1.332 and for the twenty-six weeks ended June 30, 2015 was translated into U.S. dollars using an exchange rate of Euro 1 = U.S. $1.122, the average rates for each of the periods presented. The balance sheet information was translated into U.S. dollars using an exchange rate of Euro 1 = U.S. $1.106, the rate at July 4, 2015.

All intercompany accounts and transactions between the Farncombe Entities have been eliminated in the combined condensed financial statements. Adjustments to eliminate intercompany revenues and expenses of $0.8 million and $0.4 million are included in the Historical Farncombe Entities column on the accompanying combined condensed statements of operations for the fiscal year ended January 3, 2015 and the twenty-six weeks ended July 4, 2015, respectively. An adjustment to eliminate management fee income and expense of $0.6 million is included in the Historical Farncombe Entities column on the accompanying combined condensed statement of operations for the fiscal year ended January 3, 2015. Management fees for the twenty-six weeks ended July 4, 2015 were not significant.

Cartesian reports its operating results on a 52/53-week fiscal year basis. The fiscal year end is determined as the Saturday ending nearest December 31. The Farncombe Entities report their operating results on a calendar year basis and their results are included in the unaudited pro forma combined condensed financial statements based on their fiscal year. The difference in fiscal periods is not considered material to the unaudited pro forma combined condensed financial statements.

Preliminary Purchase Price

The total preliminary purchase price transferred to effect the acquisition of the Farncombe Entities is as follows (in thousands):

	(in thousands)
Cash paid at closing	$	1,017
Equity issued at closing		2,036
Fair value of contingent consideration		1,667
Working capital adjustment		1,928
Total preliminary purchase price	$	6,648

Under the Share Purchase Agreement (the “Purchase Agreement”) dated July 22, 2015 between the Company and the shareholders of the Farncombe Entities (the “Sellers”), the purchase consideration for the capital stock of the Farncombe Entities and related agreements of the Sellers consists of (i) cash and shares of the Company’s Common Stock, par value $0.005 (“Company Common Stock”) paid at the closing of the Farncombe Acquisition (“Closing”), (ii) cash payable after Closing in accordance with the Purchase Agreement upon determination of the net working capital of the Farncombe Entities and (iii) the contingent right of the Sellers to receive additional cash and shares of Company Common Stock pursuant to an earn-out (the “Earn-Out”) based upon the performance of the Farncombe Entities after Closing.

The Earn-Out opportunity, is potentially payable in cash and/or shares of Company Common Stock as elected by each Seller as set forth in the Purchase Agreement. The aggregate amount potentially payable pursuant to the Earn-Out consists of cash in an amount up to £719,483 pounds sterling (approximately US$1.1 million based on an exchange rate of £1.556= US$1.00 as of July 21, 2015) and up to 461,055 shares of Company Common Stock (approximately £1,024,765 pounds sterling or US$1.6 million based on an exchange rate of £1.556=US$1.00 as of July 21, 2015).

Preliminary Purchase Price Allocation

Total purchase consideration has been allocated to the tangible and intangible assets and to liabilities assumed based on their respective acquisition-date fair values. The measurement period for purchase price allocations ends as soon as information on the facts and circumstances becomes available, but does not exceed 12 months. If new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized for assets acquired and liabilities assumed, the Company will retrospectively adjust the amounts recognized as of the acquisition date. The preliminary purchase price allocation is summarized in the following table (in thousands):

	(in thousands)
Tangible assets and liabilities
Current assets, including cash acquired	$	11,266
Non-current assets		60
Current liabilities		7,971
Non-current liabilities		–
Intangible assets		1,190
Goodwill		2,103
Net assets acquired	$	6,648

Based on the preliminary results of the acquisition valuation, the Company has allocated approximately $1.2 million of the purchase price to identifiable intangible assets. The following table summarizes the major classes of intangible assets, as well as the respective weighted-average amortization periods:

			Weighted- Average
	Amount		Amortization Period
	(in thousands)		(Years)
Identifiable Intangible Assets
Tradename	$	90		1.0
Non-compete agreements		60		5.0
Customer relationships		1,040		4.0
Total identifiable intangible assets	$	1,190

The excess of purchase consideration over net assets assumed was recorded as goodwill, which represents the strategic value assigned to the Farncombe Entities, including the expected benefit from synergies resulting from the transaction, as well as the knowledge and experience of the workforce in place. In accordance with applicable accounting standards, goodwill will not be amortized but instead will be tested for impairment at least annually, or more frequently, if certain indicators are present. In the event that management determines that the value of goodwill becomes impaired, the combined company will incur an accounting charge for the amount of the impairment during the fiscal quarter in which the determination is made. The goodwill and intangible assets related to this acquisition are not deductible for foreign tax purposes.

The fair values of assets acquired and liabilities assumed are based on preliminary estimates of fair values as of the acquisition date. Management believes the fair values recognized for the assets acquired and liabilities assumed are based on reasonable estimates and assumptions. Preliminary fair value estimates may change as additional information becomes available. There can be no assurance that the final determination will not result in material changes from these preliminary amounts. Amounts preliminarily allocated to intangible assets and goodwill may change significantly, and amortization methods and useful lives may differ from the assumptions that have been used in this unaudited pro forma combined condensed financial information, any of which could result in a material change in operating expenses.

Note 2 – Pro Forma Adjustments

The accompanying unaudited pro forma combined condensed balance sheet has been prepared as if the Farncombe Acquisition was completed on July 4, 2015 and accompanying unaudited pro forma combined condensed statements of operations have been prepared as if the acquisition of the Farncombe Entities was completed on December 29, 2013, and reflect the following unaudited pro forma adjustments (in thousands):

[A] The elimination of the Farncombe Entities Stockholders’ Equity and historical goodwill.

[B] Acquisition Funding

The acquisition of the Farncombe Entities was funded by available cash on hand in the amount of £654,093 (or approximately $1.0 million) and by the issuance of 588,567 shares of Company Stock equal to £1,308,186 (or approximately $2.0 million) and estimated additional consideration payable upon determination of the net working capital of the Farncombe Entities as if the acquisition of the Farncombe Entities occurred on July 4, 2015.

[C] To record goodwill and identifiable intangible assets and related amortization expense.

Based on the preliminary results of the acquisition valuation, the Company has allocated approximately $1.2 million of the purchase price to identifiable intangible assets. The following table summarizes the major classes of intangible assets, as well as the respective weighted-average amortization periods:

			Weighted- Average
	Amount		Amortization Period
	(in thousands)		(Years)
Goodwill	$	2,103		N/A
Identifiable Intangible Assets
Tradename	$	90		1.0
Non-compete agreements		60		5.0
Customer relationships		1,040		4.0
Total identifiable intangible assets	$	1,190

The following table outlines the amortization of intangible assets for the fiscal year ended January 3, 2015 and the twenty-six weeks ended July 4, 2015 (in thousands):

			Fiscal Year Ended		Twenty-Six Weeks Ended
			January 3,		July 4,
	Amount		2015		2015
	(in thousands)		Amortization		Amortization
Identifiable Intangible Assets
Tradename	$	90	$	90	$	–
Non-compete agreements		60		12		6
Customer relationships		1,040		260		130
Total identifiable intangible assets	$	1,190	$	362	$	136

The following table outlines the estimated future amortization expense at January 3, 2015 and July 4, 2015 related to the amortizing intangible assets related to the acquisition of the Farncombe Entities.

	Fiscal Year Ended January 3, 2015		Twenty-six Weeks Ended July 4, 2015
2015	$	272	$	136
2016		272		272
2017		272		272
		12		12
	$	828	$	692

[D] To record a pro forma adjustment related to Farncombe Acquisition transaction costs of $292,000 incurred during the twenty-six weeks ended July 4, 2015.

[E] To record a liability for the fair value of contingent consideration related to the contingent right of the sellers to receive additional cash and shares of Company Common Stock pursuant to an earn-out (the “Earn-Out”) based upon the performance of the Farncombe Entities after Closing. The term of the Earn-Out opportunity ends on the second anniversary of the Closing. The Earn-Out liability was calculated using a Monte Carlo simulation using a risk-adjusted discount rate and management’s estimate of forecasted revenues that are eligible under the Earn-Out as described in the Purchase Agreement. The fair value of the Earn-Out liability will be evaluated each reporting period and changes in its fair value will be included in the Company’s results of operations.

The Earn-Out opportunity, is potentially payable in cash and/or shares of Company Common Stock as elected by each Seller as set forth in the Purchase Agreement. The aggregate amount potentially payable pursuant to the Earn-Out consists of cash in an amount up to £719,483 pounds sterling (approximately US$1.1 million based on an exchange rate of £1.556= US$1.00 as of July 21, 2015) and up to 461,055 shares of Company Common Stock (approximately £1,024,765 pounds sterling or US$1.6 million based on an exchange rate of £1.556=US$1.00 as of July 21, 2015). The actual number of shares to be issued and amount of cash to be paid is not determinable until the end of the Earn-Out period based on the achievement of the revenue target amounts specified in the Purchase Agreement subject to earlier payment upon certain change of control events relating to Cartesian or the Farncombe Entities as specified in the Purchase Agreement.

[F] Adjustment to record tax benefit to reflect the pro forma income tax impact at the Company’s statutory income tax rate.