10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________

FORM 10-K

[ X ]	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended March 28, 2015 ,

or

[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _____________ to _____________.

Commission File No. 0-12719

GIGA-TRONICS INCORPORATED

(Exact name of registrant as specified in its charter)

California	94-2656341
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
4650 Norris Canyon Road, San Ramon, CA	94583
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (925) 328-4650

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock, No par value	The NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [ ] No [ X ]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.

Yes [ ] No [ X ]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:

Yes [ X ] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes [ X ] No [ ]

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 Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

[ X ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	[ ]	Accelerated filer	[ ]
Non-accelerated filer	[ ]	Smaller reporting company	[ X ]
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2).

Yes [ ] No [ X ]

The aggregate market value of voting and non-voting common equity held by non-affiliates of the Registrant computed by reference to the price at which the common equity was sold or the average bid and asked prices as of September 27, 2014 was $9,731,799.

There were a total of 6,725,281 shares of the Registrant’s Common Stock outstanding as of June 2, 2015.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the following documents have been incorporated by reference into the parts indicated:

PART OF FORM 10-K	DOCUMENT
PART III	Registrant’s PROXY STATEMENT for its 2015 Annual Meeting of Shareholders to be filed no later than 120 days after the close of the fiscal year ended March 28, 2015.

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TABLE OF CONTENTS

		Page
	PART I
ITEM 1.	Business	4
ITEM 1A.	Risk Factors	8
ITEM 1B.	Unresolved Staff Comments	10
ITEM 2.	Properties	10
ITEM 3.	Legal Proceedings	10
ITEM 4.	Mine Safety Disclosures	10
	PART II
ITEM 5.	Market for Common Equity, Related Stockholder Matters and Issuer Repurchases of Equity Securities	11
ITEM 6.	Selected Financial Data	12
ITEM 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	13
ITEM 7A.	Quantitative and Qualitative Disclosures About Market Risk	21
ITEM 8.	Financial Statements and Supplementary Data	22
	Consolidated Balance Sheets as of March 28, 2015 and March 29, 2014	23
	Consolidated Statements of Operations for the years ended March 28, 2015 and March 29, 2014	24
	Consolidated Statements of Shareholders' Equity for the years ended March 28, 2015 and March 29, 2014	25
	Consolidated Statements of Cash Flows for the years ended March 28, 2015 and March 29, 2014	26
	Notes to Consolidated Financial Statements	27
	Report of Independent Registered Public Accounting Firm	46
ITEM 9.	Changes In and Disagreements With Accountants On Accounting and Financial Disclosure	47
ITEM 9A.	Controls and Procedures	47
ITEM 9B.	Other Information	48
	PART III
ITEM 10.	Directors, Executive Officers and Corporate Governance	49
ITEM 11.	Executive Compensation	49
ITEM 12.	Security Ownership Of Certain Beneficial Owners and Management and Related Shareholder Matters	49
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence	49
ITEM 14.	Principal Accountant Fees and Services	49
	PART IV
ITEM 15.	Exhibits and Financial Statements Schedules	50
SIGNATURES		51

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PART 1

The forward-looking statements included in this report including, without limitation, statements containing the words “believes”, “anticipates”, “estimates”, “expects”, “intends” and words of similar import, which reflect management’s best judgment based on factors currently known, involve risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including but not limited to those discussed under “Certain Factors Which May Adversely Affect Future Operations Or An Investment In Giga-tronics” in Item 1 below and in Item 7, “Management’s Discussion and Analysis”.

ITEM 1. BUSINESS

General

Giga-tronics Incorporated (Giga-tronics, or the Company) includes the operations of the Giga-tronics Division and Microsource Inc. (Microsource), a wholly owned subsidiary. Giga-tronics Division designs, manufactures and markets a broad line of test and measurement equipment used in the development, test and maintenance of wireless communications products and systems, flight navigational equipment, electronic defense systems and automatic testing systems. These products are used primarily in the design, production, repair and maintenance of commercial telecommunications, radar, and electronic warfare equipment.

Microsource develops and manufactures a broad line of YIG (Yttrium, Iron, Garnet) tuned oscillators, filters and microwave synthesizers, which are used by its customers in operational applications and in manufacturing a wide variety of microwave instruments and devices.

Giga-tronics was incorporated on March 5, 1980, and Microsource was acquired by Giga-tronics on May 18, 1998.

The combined Company principal executive offices are located at 4650 Norris Canyon Road, San Ramon, California, and its telephone number at that location is (925) 328-4650.

Giga-tronics intends to broaden its product lines and expand its market primarily through internal development of new products.

Industry Segments

The Company manufactures products used in test, measurement and control. The Company has two reporting segments: Giga-tronics Division and Microsource.

For more information regarding the Company’s two reporting segments, see “Part II-Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements-Significant Customers and Industry Segment Information.”

Products and Markets

Giga-tronics

The Giga-tronics Division produces signal sources, generators, power measurement and amplification instruments for use in the microwave and radio frequency (RF) range (10 kilohertz (kHz) to 50 gigahertz (GHz)).  Within each product line are a number of different models and options allowing customers to select frequency range and specialized capabilities, features and functions.  The end-user markets for these products can be divided into three broad segments:  electronic warfare, radar and commercial telecommunications.  These instruments are used in the design, production, repair and maintenance and calibration of other manufacturers’ products, from discrete components to complex systems.

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The Giga-tronics Division also produces switching systems that operate with a bandwidth from direct current (DC) to optical frequencies.  These switch systems may be incorporated within customers’ automated test equipment. The end-user markets for these products are primarily related to defense, aeronautics, communications, satellite and electronic warfare, commercial aviation and semiconductors.

 Microsource

The Microsource segment develops and manufactures a broad line of YIG tuned oscillators, filters, filter components, and microwave synthesizers, which are used by its customers in operational applications and in manufacturing a wide variety of microwave instruments or devices. The end-user markets for these products are primarily related to defense and commercial aerospace.  

Sources and Availability of Raw Materials and Components

Substantially all of the components required by Giga-tronics to make its assemblies are available from more than one source. The Company occasionally uses sole source arrangements to obtain leading-edge technology or favorable pricing or supply terms, but not in any material volume. In the Company’s opinion, the loss of any sole source arrangement it has would not be material to its operations. Some suppliers are also competitors of Giga-tronics. In the event a competitor-supplier chooses not sell its products to Giga-tronics, production delays could occur as the Company seeks new suppliers; or, as the Company re-designs components to its products.

Although extended delays in receipt of components from its suppliers could result in longer product delivery schedules for the Company, the Company believes that its protection against this possibility stems from its practice of dealing with well-established suppliers and maintaining good relationships with such suppliers.

Patents and Licenses

The Company’s competitive position is largely dependent upon its ability to provide performance specifications for its instruments and systems that (a) are easy to use and effectively and reliably meet customers’ needs and (b) selectively surpass competitors’ specifications in competing products. Patents may occasionally provide some short-term protection of proprietary designs. However, because of the rapid progress of technological development in the Company’s industry, such protection is most often, although not always, short-lived. Therefore, although the Company occasionally pursues patent coverage, it places major emphasis on the development of new products with superior performance specifications and the upgrading of existing products toward this same end.

The Company’s products are based on its own designs, which are derived from its own engineering abilities. If the Company’s new product engineering efforts fall behind, its competitive position weakens. Conversely, effective product development greatly enhances its competitive status.

The Company presently holds 31 patents. Some of these are critical to the Company’s ongoing business, and the Company intends to actively maintain them. Capitalized costs relating to these patents were both incurred and fully amortized prior to March 27, 2011. Accordingly, these patents have no recorded value included in the Company’s consolidated financial statements for the fiscal years ended March 28, 2015 (“fiscal 2015”) and March 29, 2014 (“fiscal 2014”).

The Company is not dependent on trademarks, licenses or franchises. It does utilize certain software licenses in certain functional aspects for some of its products. Such licenses are readily available, non-exclusive and are obtained at either no cost or for a relatively small fee.

Seasonal Nature of Business

The business of the Company is not seasonal.

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Working Capital Practices

The Company generally strives to maintain adequate levels of inventory and generally sells to customers on 30-day payment terms in the U.S. and generally allows more time for overseas payments. Typically, the Company receives payment terms of 30 days from its suppliers. The Company believes that these practices are consistent with typical industry practices.

Importance of Limited Number of Customers

The Company is a supplier of microwave and RF test instruments to various United States (U.S.) government defense agencies, as well as to their prime contractors. Management anticipates sales to U.S. government agencies and their prime contractors will remain significant in fiscal 2016. U.S. and international defense-related agencies accounted for 73% and 57% of net sales in fiscal 2015 and 2014, respectively. Commercial business accounted for the remaining 27% and 43% of net sales in fiscal 2015 and fiscal 2014, respectively.

At the Giga-tronics Division, U.S. defense agencies and their prime contractors accounted for 40% and 25% of net sales in fiscal 2015 and fiscal 2014, respectively. Microsource reported 98% and 96% of net sales to U.S. defense agencies and their prime contractors during fiscal 2015 and fiscal 2014, respectively.

During fiscal 2015, one customer accounted for 28% of the Company’s consolidated revenues and was included in the Microsource reporting segment. A second customer accounted for 23% of the Company’s consolidated revenues during fiscal 2015 and was also included in the Microsource reporting segment. A third customer accounted for 14% of the Company’s consolidated revenues during fiscal 2015 and was included in the Giga-tronics Division reporting segment.

During fiscal 2014, one customer accounted for 39% of the Company’s consolidated revenues and was included in the Microsource reporting segment. A second customer accounted for 16% of the Company’s consolidated revenues during fiscal 2014 and was included in the Giga-tronics Division reporting segment.

In management’s opinion, the Company could experience a material adverse effect on its financial stability if there was a significant loss of either its defense or commercial customers.

The Company’s products are largely capital investments for its customers, and the Company’s belief is that its customers have economic cycles in which capital investment budgets for the kinds of products that the Company produces expand and contract. The Company, therefore, expects that a major customer in one year will often not be a major customer in the following year. Accordingly, the Company’s net sales and earnings will decline if the Company is unable to find new customers or increase its business with other existing customers to replace declining net sales from the previous year’s major customers. A substantial decline in net sales to U.S. government defense agencies and their prime contractors would also have a material adverse effect on the Company’s net sales and results of operations unless replaced by net sales in the commercial sector.

Backlog of Orders

On March 28, 2015, the Company’s backlog of unfilled orders was approximately $5.7 million compared to approximately $6.7 million at March 29, 2014. As of March 28, 2015, there were approximately $521,000 of orders scheduled for shipment beyond one year. As of March 29, 2014, there were approximately $1.2 million of orders scheduled for shipment beyond one year. Orders for the Company’s products include program orders from both the U.S. government and defense contractors with extended delivery dates. Accordingly, the backlog of orders may vary substantially from year to year and the backlog entering any single quarter may not be indicative of sales for any period.

Backlog includes only those customer orders for which a delivery schedule has been agreed upon between the Company and the customer and, in the case of U.S. government orders, for which funding has been appropriated.

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Competition

Giga-tronics serves the broad market for electronic instrumentation with applications ranging from the design, test, calibration and maintenance of other electronic devices to providing sophisticated components for complex electronic systems to sub-systems capable of sorting and identifying high frequency signals.  These applications cut across the military, commercial and industrial segments of the broader market.  The Company has a variety of competitors.  Several of its competitors such as Agilent/Keysight, Anritsu and Rohde & Schwarz are much larger than the Company and have greater resources in research and development and manufacturing with substantially broader product lines and channels.  Others are of comparable size or have small product divisions with more limited product lines, such as EADS Company, VTI Instruments, Elcom Group, Aeroflex (now Cobham Plc) and Herley Industries (now Kratos Electronic Products Division).

To compete effectively in this circumstance, the Company (a) places strong emphasis on maintaining a high degree of technical competence as it relates to the development of new products and the upgrading of existing products in less competitive growth areas, (b) is highly selective in establishing technological objectives and (c) focuses sales and marketing activities in areas that are weakly served or underserved. The Company does not attempt to compete ‘across the board’, but selectively based upon its particular strengths, the competitors’ perceived limitations, the customer’s needs and market opportunities.

The Company is able to compete by offering differentiated products that meet a customer’s particular specification requirements in high value niches; by being able to present the correct product functionality at a high quality level, and by configuring its core platforms to fit the application need.  All of these advantages are attributable to the Company’s continuing investment in platform research and development and in a highly trained engineering staff.

When the opportunity involves custom solutions, satisfying the customer’s specific requirements assumes greater importance and the Company has more flexibility in making modifications and enhancements than its larger and more structured competitors.

Sales and Marketing

Giga-tronics and Microsource market their products through various independent distributors and representatives to commercial and government customers for its instrument products but sell primarily direct on its switch and component products, although not necessarily through the same distributors and representatives.

Product Development

Products of the type manufactured by Giga-tronics historically have had relatively long product life cycles. However, the electronics industry is subject to rapid technological changes at the component level. The future success of the Company is dependent on its ability to steadily incorporate advancements in component technologies into its new products. In fiscal 2015 and fiscal 2014, product development expenses totaled approximately $3.2 million and $3.9 million respectively.

Activities included the development of new products and the improvement of existing products. It is management’s intention to maintain product development at levels required to sustain its competitive position. The Company’s product development activities are funded internally, or through outside equity investment and debt. Product development activities are expensed as incurred.

The Company expects to continue to make significant investments in research and development. There can be no assurance that future technologies, processes or product developments will not render the Company’s current product offerings obsolete or that the Company will be able to develop and introduce new products or enhancements to existing products that satisfy customer needs in a timely manner or achieve market acceptance. Failure to do so could adversely affect the Company’s business.

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Manufacturing

The assembly and testing of Giga-tronics Division and Microsource’s products are done at its San Ramon facility.

Environment

To the best of its knowledge, the Company is in compliance with all Federal, state and local laws and regulations involving the protection of the environment.

Employees

As of March 28, 2015 and March 29, 2014, the Company employed 71 and 76 individuals on a full-time basis, respectively. Management believes that the future success of the Company depends on its ability to attract and retain skilled personnel. None of the Company’s employees are represented by a labor union, and the Company considers its employee relations to be good.

Information about Foreign Operations

The Company sells to its international customers through a network of foreign technical sales representative organizations. All transactions between the Company and its international customers are in U.S. dollars.

Geographic Distribution of Net Sales
(Dollars in thousands)	2015		2014		2015			2014
Domestic	$	16,985	$	11,832		92	%		89	%
International		1,467		1,477		8	%		11	%
Total	$	18,452	$	13,309		100.0	%		100.0	%

See Item 8, footnote 7 of the consolidated financial statements for further breakdown of international sales for the last two years.

ITEM 1A. RISK FACTORS

Future liquidity is uncertain

Based on current levels of sales and expenses, and based on management's forecast of operations in the near future, management believes that cash and cash equivalents remain adequate to meet current operating needs. The cash forecasts are based on projections that may or may not be realized, and therefore actual cash usage could be greater than projected. In this circumstance, the Company could encounter a need to obtain additional funds from outside sources. If such additional working capital is required, there are no assurances that such financing sources will be available on favorable terms to the Company, if at all. 

Customer orders and production of new product platform

The Company invested heavily in the development of its new product platform, the Advanced Signal Generation system. In the fourth quarter of fiscal 2015 two customers accepted their initial units of the Advanced Signal Generation System. Longer than anticipated sales cycles in fiscal 2016, or delays in production and shipping volume quantities, could significantly contribute to additional losses.

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Ability to stay listed for trading on The NASDAQ Capital Market

If the Company’s shareholders’ equity falls below $2.5 million, The Nasdaq Stock Market could delist the Company from The Nasdaq Capital Market. On February 20, 2015, the Company received a letter from The Nasdaq Stock Market informing the Company that a Nasdaq Hearings Panel (the “Panel”) determined that the Company had regained compliance with Nasdaq Listing Rule 5550(b)(1), the minimum stockholders’ equity rule (the “Stockholders’ Equity Rule”). As a result, the Panel determined that the Company is in compliance with all applicable listing standards required for listing on The Nasdaq Capital Market, and accordingly, the Panel has determined to continue the listing of the Company’s securities on The Nasdaq Stock Market. However, because the Company has met compliance with the Stockholders’ Equity Rule by a relatively small margin, the Panel has imposed a Panel Monitor to monitor the Company’s continued compliance with the Stockholders’ Equity Rule until February 27, 2016. The Company is under certain notification obligations during this time period, including the obligation to notify the Panel Monitor if it fails to comply with the Stockholders’ Equity Rule or any other applicable listing requirement. If the Company’s Common Stock ceases to be listed for trading on The Nasdaq Capital Market, the Company expects that its Common Stock would be traded on the Over-the-Counter Bulletin Board on or about the same day.

Giga-tronics’ sales are substantially dependent on the defense industry

Giga-tronics has a significant number of defense-related orders. If the defense market demand decreases, actual shipments could be less than projected shipments with a resulting decline in sales. The Company’s product backlog has a number of risks and uncertainties such as the cancellation or deferral of orders, dispute over performance and the Company’s ability to collect amounts due under these orders. If any of these events occur, actual shipments could be lower than projected shipments and revenues could decline.

Giga-tronics’ markets involve rapidly changing technology and standards

The market for electronics equipment is characterized by rapidly changing technology and evolving industry standards. Giga-tronics believes that its future success will depend in part upon its ability to develop and commercialize its existing products, and in part to develop, manufacture and successfully introduce new products and product lines with improved capabilities and to continue to enhance existing products. There can be no assurance that Giga-tronics will successfully complete the development of current or future products, or that such products will achieve market acceptance. The inability to develop new products in a timely manner could have a material adverse impact on operating performance and liquidity.

Giga-tronics’ common stock price is volatile

The market price of the Company’s common stock could be subject to significant fluctuations in response to variations in quarterly operating results, reduction in revenues or lower earnings or increased losses and reduced levels of liquidity when compared to previous quarterly periods, and other factors such as announcements of technological innovations or new products by Giga-tronics or by competitors, government regulations or developments in patent or other proprietary rights. In addition, NASDAQ and other stock markets have experienced significant price fluctuations in recent years. Some of these fluctuations often have been unrelated to the reported operating performance of the specific companies whose stocks are traded. Broad market fluctuations, as well as general foreign and domestic economic conditions, may adversely affect the market price of the common stock.

Giga-tronics stock at any time has historically traded on low volume on the NASDAQ Capital Market. Sales of a significant volume of stock could result in a decline of Giga-tronics’ share price.

Performance problems in Giga-tronics’ products or problems arising from the use of its products together with other vendors’ products may harm its business and reputation

Products as complex as those Giga-tronics produces may contain unknown and undetected defects or performance problems. For example, it is possible that a product might not comply with stipulated specifications under all circumstances. In addition, Giga-tronics’ customers generally use its products together with their own products and products from other vendors. As a result, when problems occur in a combined environment, it may be difficult to identify the source of the problem. A defect or performance problem could result in lost revenues, increased warranty costs, diversion of engineering and management time and effort, impaired customer relationships and injury to Giga-tronics’ reputation generally. To date, performance problems in Giga-tronics’ products or in other products used together with Giga-tronics’ products have not had a material adverse effect on its business. However, management cannot be certain that a material adverse impact will not occur in the future.

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Giga-tronics’ competition has greater resources

The Company’s instrument, switch, oscillator and synthesizer products compete with Agilent/Keysight, Anritsu, EADS Company, Aeroflex (now Cobham Plc) and Rohde & Schwarz. All of these companies have substantially greater research and development, manufacturing, marketing, financial, and technological personnel and managerial resources than Giga-tronics. These resources also make these competitors better able to withstand difficult market conditions than the Company. There can be no assurance that any products developed by the competitors will not gain greater market acceptance than any developed by Giga-tronics.

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2. PROPERTIES

Giga-tronics’ principal executive office and the marketing, sales and engineering offices and manufacturing facilities are located in approximately 47,300 square feet in San Ramon, California, which the Company occupies under a lease agreement expiring December 31, 2016.

The Company believes that its facilities are adequate for its business activities.

ITEM 3. LEGAL PROCEEDINGS

A sole distributor of certain products has made a claim for commissions in connection with prior and future sales by the Company of products that the Company believes are excluded from the terms of the distribution agreement between the parties. As of March 28, 2015, the Company has no material pending legal proceedings. From time to time, Giga-tronics is involved in various disputes and litigation matters that arise in the ordinary course of business.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

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PART II

ITEM 5. MARKET FOR COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER REPURCHASES OF EQUITY SECURITIES

Common Stock Market Prices

Giga-tronics’ common stock is traded on the Nasdaq Capital Market using the symbol ‘GIGA’. The number of record holders of the Company’s common stock as of March 28, 2015 was approximately 113. The table below shows the high and low closing bid quotations for the common stock during the indicated fiscal periods. These quotations reflect inter-dealer prices without mark-ups, mark-downs, or commission and may not reflect actual transactions.

	2015	High		Low		2014	High		Low
First Quarter	(3/30 - 6/28)	$	3.45	$	1.16	(4/1 - 6/30)	$	1.79	$	1.37
Second Quarter	(6/29 - 9/27)		3.21		1.84	(7/1 - 9/28)		1.44		1.22
Third Quarter	(9/28 - 12/27)		2.00		1.40	(9/29 - 12/28)		1.24		0.90
Fourth Quarter	(12/28 - 3/28)		1.95		1.43	(12/29 - 3/29)		1.55		0.92

On February 20, 2015, the Company received a letter from The Nasdaq Stock Market informing the Company that a Nasdaq Hearings Panel (the “Panel”) determined that the Company had regained compliance with Nasdaq Listing Rule 5550(b)(1), the minimum stockholders’ equity rule (the “Stockholders’ Equity Rule”). As a result, the Panel determined that the Company is in compliance with all applicable listing standards required for listing on The Nasdaq Capital Market, and accordingly, the Panel has determined to continue the listing of the Company’s securities on The Nasdaq Stock Market. However, because the Company has met compliance with the Stockholders’ Equity Rule by a relatively small margin, the Panel has imposed a Panel Monitor to monitor the Company’s continued compliance with the Stockholders’ Equity Rule until February 27, 2016. The Company is under certain notification obligations during this time period, including the obligation to notify the Panel Monitor if it fails to comply with the Stockholders’ Equity Rule or any other applicable listing requirement. If the Company’s Common Stock ceases to be listed for trading on the Nasdaq Capital Market, the Company expects that its Common Stock would be traded on the Over-the-Counter Bulletin Board on or about the same day.

The market price of the Company’s Common Stock may be adversely affected if it ceases to be listed for trading on the Nasdaq Capital Market.

Giga-tronics has not paid cash dividends in the past and has no current plans to do so in the future, believing the best use of its available capital is in the enhancement of its product position.

On February 16, 2015, the Company entered into a Securities Purchase Agreement and Warrant Agreement with Alara Capital in which the Company received total gross cash proceeds of approximately $1.5 million. Funds were received from Alara in separate closings dated February 16, 2015 and February 23, 2015 in which Alara exercised a total of 1,002,818 of its existing Series C and Series D warrants to purchase common shares, all of which had an exercise price of $1.43 per share for total cash proceeds of $1,434,000, which was recorded net of $42,000 of issuance costs. As part of the consideration for this exercise, the Company sold to Alara two new warrants to purchase an additional 898,634 and 194,437 common shares at an exercise price of $1.78 and $1.76 per share, respectively, for a total purchase price of $137,000 or $0.125 per share, The new warrants have a term of five years and may be paid in cash or through a cashless net share settlement. The Company and Alara amended the remaining 14,587 warrants as part of the February closings. On May 14, 2015, Alara exercised the remaining 14,587 warrants by acquiring 7,216 of shares of the Company’s common stock through a cashless net share settlement. All such transactions were previously reported in current reports on Form 8-K.

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Equity Compensation Plan Information

The following table provides information on options and other equity rights outstanding and available at March 28, 2015.

Equity Compensation Plan Information
	No. of securities to be issued upon exercise of outstanding options, stock awards, warrants and rights		Weighted average exercise price of outstanding options, stock awards, warrants and rights		No. of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
Plan Category	(a)		(b)		(c)
Equity compensation plans approved by security holders		2,208,975		$1.23		397,425
Equity compensation plans not approved by security holders		—		—	n/a
Total		2,208,975		$1.23		397,425

Issuer Repurchases

The Company did not repurchase any of its equity securities during the fiscal year ended March 28, 2015.

ITEM 6. SELECTED FINANCIAL DATA

Pursuant to Item 301(c) of Regulation S-K., the Company, as a smaller reporting company, is not required to provide the information required by this item.

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

Overview

Giga-tronics produces instruments, subsystems and sophisticated microwave components that have broad applications in both defense electronics and wireless telecommunications. The Company has two reporting segments: Giga-tronics Division and Microsource.

Giga-tronics Division produces a broad line of test and measurement equipment used in the development, test and maintenance of wireless communications products and systems, flight navigational equipment, electronic defense systems and automatic testing systems and designs, manufactures, and markets a line of switching devices that link together many specific purpose instruments that comprise automatic test systems. These products are used primarily in the design, production, repair and maintenance of radar, electronic warfare equipment and commercial telecommunications.

Microsource develops and manufactures a broad line of YIG (Yttrium, Iron, Garnet) tuned oscillators, filters and microwave synthesizers, which are used by its customers in operational applications and in manufacturing a wide variety of microwave instruments and devices.

In fiscal 2015 the Giga-tronics Division received a $2.4 million order from the United States Navy (“Navy”) for its Model 8003 Precision Scalar Analyzers product (“8003”). The Navy was a significant customer for the Company in fiscal 2015. Also, in both fiscal 2015 and fiscal 2014 the Giga-tronics Division had a range of customers, both domestic and international, and one significant reseller.

In fiscal 2015 the Microsource business unit received a $6.5 million order from a major aerospace company for non-recurring engineering services to develop a variant of its high performance fast tuning YIG filters for an aircraft platform and to deliver a limited number of flight-qualified prototype hardware units (the “NRE Order”). On May 14, 2015 the Company finalized a multi-year follow-on order for $10.0 million associated with the production units, which are anticipated to start shipping in August of 2016.

In fiscal 2015 and fiscal 2014, almost all of the orders and sales for the Microsource business unit were from two large aerospace customers. Almost all the orders and revenue for the Microsource business is associated with programs for retrofitting radar filter components on existing military aircraft and radar filter components for new military aircraft. The timing of orders and milestone achievements associated with these customers causes significant differences in orders, backlog, sales, deferred revenue, inventory and cash flow when comparing one fiscal period to another.

The Company experienced significant improvements to net sales and results of operations in fiscal 2015, when compared to fiscal 2014, due to the Giga-tronics Division Navy 8003 order and Microsource NRE Order.

Since fiscal 2012, the Company has invested heavily in the development of a new Advanced Signal Generation System. This investment contributed to substantial losses in fiscal years 2012 to 2014 and has comprised a significant portion of the Company’s research and development expenses since fiscal 2012. Late in fiscal 2015, the Company achieved an important milestone when two customers formally accepted their initial units of the Company’s new product. The Company believes the new Advanced Signal Generation System will significantly contribute to the Company’s long term success.

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Results of Operations

New orders by reporting segment are as follows for the fiscal years ended:

NEW ORDERS					% change
					2015			2014
					vs.			vs.
(Dollars in thousands)	2015		2014		2014			2013
Giga-tronics Division	$	9,095	$	8,684		5	%		(4%	)
Microsource		8,416		4,947		70	%		(43%	)
Total	$	17,511	$	13,631		28	%		(23%	)

New orders received in fiscal 2015 increased 28% to $17.5 million from the $13.6 million received in fiscal 2014. The increase in orders was primarily due to Microsource’s receipt in fiscal 2015 of the approximately $6.5 million NRE order from a large aerospace company. The increase in new orders for the Giga-tronics Division in fiscal 2015 is primarily due to the $2.4 million order from the Navy, which was partially offset by decreases in orders associated with older legacy Giga-tronics Division products.

New orders received in fiscal 2014 decreased 23% to $13.6 million from the $17.7 million received in fiscal 2013. The decrease was primarily due to Microsource’s receipt in fiscal 2013 of $8.2 million in long term contracts from a large aerospace company compared to $4.0 million in fiscal 2014.

The following table shows order backlog and related information at fiscal year-end:

Backlog					% change
					2015			2014
					vs.			vs.
(Dollars in thousands)	2015		2014		2014			2013
Backlog of unfilled orders	$	5,729	$	6,669		(14%	)		(9%	)
Backlog of unfilled orders shippable within one year		5,208		5,438		(4%	)		(19%	)
Long term backlog reclassified during year as shippable within one year		521		931		(44%	)		(57%	)

The decreases in backlog at the end of fiscal 2015 and fiscal 2014 are primarily due to the timing of the Microsource business unit’s receipt of annual production contracts and production delivery schedules requested by customers.

The allocation of net sales by reporting segment was as follows for the fiscal years shown:

Allocation of Net Sales					% change
					2015			2014
					vs.			vs.
(Dollars in thousands)	2015		2014		2014			2013
Giga-tronics Division	$	9,123	$	7,290		25	%		(22	%)
Microsource		9,329		6,019		55	%		25	%
Total	$	18,452	$	13,309		39	%		(6%	)

Net sales in fiscal 2015 were $18.5 million, a 39% increase from $13.3 million in fiscal 2014. Sales for the Giga-tronics Division increased 25%, or $1.8 million, primarily due to the fulfillment of the $2.4 million Navy 8003 order. Sales for the Microsource business unit increased 55%, or $3.3 million, largely due to recognizing $4.7 million of sales associated with the $6.5 million NRE Order received during the year. This was partially offset by a $1.4 million decrease in the delivery of YIG filter production units associated with the contractual timing of shipments to a large aerospace company.

14

Net sales in fiscal 2014 were $13.3 million, a 6% decrease from $14.2 million in fiscal 2013. Sales for the Giga-tronics Division decreased 22%, or $2.1 million, primarily due to a decrease in SCPM switch product sales as a result of the sale of this product line during fiscal 2014 (see Note 5, Gain on Sale of Product Line). Sales for the Microsource business unit increased 25%, or $1.2 million, largely due to the contractual timing of shipments associated with long-term contracts from a large aerospace company.

The allocation of cost of sales by reporting segment was as follows for the fiscal years shown:

Cost of Sales					% change
					2015			2014
					vs.			vs.
(Dollars in thousands)	2015		2014		2014			2013
Giga-tronics Division	$	5,600	$	5,093		10	%		(11	%)
Microsource		4,845		3,718		30	%		25	%
Total	$	10,445	$	8,811		19	%		1	%

Cost of sales as a percentage of sales decreased in fiscal 2015 to 56.6%, from 66.2% for fiscal 2014.  The decrease in fiscal 2015 was primarily due to the fulfillment of the Microsource NRE Order, which had a lower cost of sales compared to product sales. 

Cost of sales as a percentage of sales increased in fiscal 2014 to 66.2%, compared to 61.4% for fiscal 2013.  The increase in fiscal 2014 was primarily due to the change in product mix of Giga-tronics Division, which saw an increase in the sales of lower margin legacy products in fiscal 2014 when compared to fiscal 2013.

Operating expenses were as follows for the fiscal years shown:

Operating Expenses					% change
					2015			2014
					vs.			vs.
(Dollars in thousands)	2015		2014		2014			2013
Engineering	$	3,210	$	3,897		(18%	)		(9%	)
Selling, general and administrative		4,783		4,809		(1%	)		(3%	)
Restructuring		—		331		(100%	)		(21%	)
Total	$	7,993	$	9,037		(12%	)		(7%	)

Operating expenses decreased 12%, or $1.0 million, in fiscal 2015 compared to fiscal 2014. Engineering expenses decreased $687,000 during fiscal 2015 when compared to fiscal 2014, which was primarily due to certain engineers being assigned to a Microsource nonrecurring engineering project that is recorded as cost of sales. Selling, general and administrative expenses were approximately $4.8 million for both fiscal 2015 and fiscal 2014. Restructuring expenses decreased $331,000 in fiscal 2015 when compared to fiscal 2014, primarily due to the Company’s completion of its closure of the Santa Rosa facility in May 2013. (see Note 13, Restructuring).

Operating expenses decreased 7%, or $639,000, in fiscal 2014 compared to fiscal 2013. Engineering expenses decreased $385,000 during fiscal 2014 when compared to fiscal 2013, which was primarily due to certain engineers being assigned to a Microsource nonrecurring engineering project that is recorded as cost of sales. Selling, general and administrative expenses decreased $167,000 in fiscal 2014 when compared to fiscal 2013, primarily due to reductions in personnel. Restructuring expenses decreased $87,000 in fiscal 2014 when compared to fiscal 2013, primarily due to the Company’s completion of its closure of the Santa Rosa facility in May 2013. (see Note 13, Restructuring).

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Operating Income (Loss)

Giga-tronics had operating income of $14,000 in fiscal 2015 compared to an operating loss of $4.5 million for fiscal 2014. The $4.5 million improvement in the results of operation in fiscal 2015 compared to fiscal 2014 was primarily due to increased revenues associated with the Microsource NRE Order and the Navy 8003 order.

Gain on the Sale of Product Line

On March 18, 2013, the Company entered into an Asset Purchase Agreement with Teradyne Inc. (“Teradyne”), whereby Teradyne agreed to purchase the Giga-tronics Division product line known as SCPM for $1.0 million, resulting in a net gain of $913,000 in fiscal 2014. (see Note 5, Gain on Sale of Product Line).

Warrant Charge Expense

In fiscal 2015 the Company recorded a $1.2 million one-time non-cash charge related to the issuance of new warrants in connection with a Stock Purchase Agreement and Warrant Agreement with Alara Capital dated February 16, 2015. Pursuant to the agreements, the Company received during February 2015 total cash proceeds of approximately $1.5 million through Alara’s exercise of its existing Series C and Series D warrants to purchase common shares, all of which had an exercise price of $1.43 per share for total cash proceeds of $1,434,000, which was recorded net of $42,000 of stock issuance costs. As part of the consideration for this exercise, the Company sold to Alara two new warrants to purchase an additional 898,634 and 194,437 common shares at an exercise price of $1.78 and $1.76 per share, respectively, for a total purchase price of $137,500 or $0.125 per share. The new warrants were accounted for and resulted in the charges described above. (see Note 17, Exercise of Series C and Series D Warrants).

Net Interest Expense

Net interest expense in fiscal 2015 was $406,000, an increase of $300,000 over fiscal 2014 and was primarily due to borrowings under the Silicon Valley Bank (“SVB”) line of credit and the loans from Partners For Growth IV, L.P. (“PFG”). For fiscal 2015, the Company also recorded $152,000 of interest expense related to accretion of discounts on the PFG Loan and Warrant Debt. There was no such accretion recorded in fiscal 2014 as the loan was funded in late fiscal 2014. (see Note 15, Term Loan, revolving Line of Credit and Warrants).

The SVB line of credit expired on April 15, 2015 and was replaced with a $2.5 million line of credit with Bridge Bank. (see Note 18, Subsequent Events).

Derivative Liability

For fiscal 2015 and 2014, there were no gains or losses recorded in association with the revaluation of the PFG debt derivative liability.

Net Loss

Giga-tronics recorded a pre-tax loss of $1.6 million for fiscal 2015 primarily due to the $1.2 million Alara Capital non-cash warrant charge described above. In fiscal 2014 Giga-tronics recorded a pre-tax loss of $3.7 million due to an operating loss of $4.5 million partially offset by a $913,000 gain on the sale of a product line described above.

16

Net Inventories

Inventories consisted of the following:

Net Inventories					% change
					2015
	March 28,		March 29,		vs.
(Dollars in thousands)	2015		2014		2014
Raw materials	$	1,631	$	1,501		9	%
Work-in-progress		1,598		1,400		14	%
Finished goods		15		353		(96	%)
Demonstration inventory		121		67		81	%
Total	$	3,365	$	3,321		1	%

Net inventories increased by $44,000 from March 29, 2014 to March 28, 2015. The increase was primarily due to purchases of inventory for future product deliveries.   

Financial Condition and Liquidity

As of March 28, 2015, Giga-tronics had $1.2 million in cash and cash-equivalents, compared to $1.1 million as of March 29, 2014.

Working capital at the end of fiscal year 2015 was $3.0 million as compared to $1.0 million at the end of fiscal year 2014. The current ratio (current assets divided by current liabilities) at March 28, 2015 was 1.69 as compared to 1.17 at March 29, 2014. The fiscal 2015 increase in working capital was primarily attributable to a $1.2 million decrease in the line of credit balance resulting from the receipt of $1.5 million in net cash proceeds from Alara Capital’s exercise of its warrants (see Note 17, Exercise of Series C and Series D Warrants) and the $508,000 increase in accounts receivable due to the increase in net sales.

Cash used in operating activities amounted to $542,000 in fiscal 2015, primarily due to the net loss of $1.7 million, a $508,000 increase in accounts receivable due to increased sales, and a $457,000 decrease in accounts payable associated with the timing of vendor payments. These were partially offset by non-cash charges of $1.2 million for the Alara Capital warrants and $827,000 for share based compensation. Cash used in operating activities was $2.5 million in fiscal 2014, primarily attributed to the net loss of $3.7 million for the year, which was partially offset by a $1.2 million decrease in inventories. 

Additions to property and equipment were $16,000 in fiscal 2015 compared to $228,000 in fiscal 2014. The additions in fiscal 2015 were associated with equipment required to manufacture the new product platform. The additions in the prior year were primarily due to leasehold improvements associated with moving the Microsource manufacturing to the San Ramon facility.

Cash provided by financing activities in fiscal year 2015 was $669,000, primarily due to $1.5 million in net proceeds from the exercise of existing Alara Capital warrants and $500,000 in proceeds from a revolving line of credit with PFG. These proceeds were partially offset by a $1.2 million repayment of the Company’s line of credit with SVB and a $200,000 repayment on the term loan with PFG. Cash provided by financing activities in fiscal 2014 was $1.9 million which was primarily the result of $1.0 million in proceeds from the PFG term loan, and $817,000 in net proceeds from the issuance of Series D convertible preferred stock.

On February 16, 2015, the Company entered into a Securities Purchase Agreement and Warrant Agreement with Alara Capital AVI II, LLC (“Alara Capital”), an investment vehicle sponsored by AVI Partners, LLC (“AVI” ) (with both entities collectively referred to herein as “Alara”), in which the Company received total gross cash proceeds of approximately $1.5 million. Funds were received from Alara in separate closings dated February 16, 2015 and February 23, 2015 in which Alara exercised a total of 1,002,818 of its existing Series C and Series D warrants to purchase common shares, all of which had an exercise price of $1.43 per share for total cash proceeds of $1,434,000, which was recorded net of $42,000 of stock issuance costs. As part of the consideration for this exercise, the Company sold to Alara two new warrants to purchase an additional 898,634 and 194,437 common shares at an exercise price of $1.78 and $1.76 per share, respectively, for a total purchase price of $137,000 or $0.125 per share, The new warrants have a term of five years and may be paid in cash or through a cashless net share settlement. The Company and Alara amended the remaining 14,587 warrants as part of the February closings. On May 14, 2015, Alara exercised the remaining 14,587 warrants by acquiring 7,216 of shares of the Company’s common stock through a cashless net share settlement.

17

On June 16, 2014, Giga-tronics amended its loan agreement with PFG. Under the terms of the amendment, PFG made a revolving line of credit available to Giga-tronics in the amount of $500,000 and the Company borrowed the entire amount on June 17, 2014. The Company’s original agreement with PFG was entered into on March 13, 2014 under which the Company received $1.0 million from a three-year term loan. Pursuant to the amended loan agreement, the Company may borrow an additional $500,000. The loan agreement contains financial covenants associated with the Company achieving minimum quarterly net sales and maintaining a minimum monthly shareholders’ equity. In the event of default by the Company, all or any part of the Company’s obligation to PFG could become immediately due.

In fiscal 2012 the Company began to invest heavily in the development of a new Giga-tronics Division product platform, the Advanced Signal Generation System. Delays in completing the Advanced Signal Generation System have contributed significantly to the losses of the Company. In fiscal 2015 the Company’s net loss was $1.7 million, which included a non-cash expense of $1.2 million related to the issuance of new warrants to Alara Capital and $152,000 of non-cash accretion of loan and warrant debt discounts. Also in fiscal 2015 the Company had operating income of $14,000, compared to an operating loss of $4.5 million in fiscal 2014.

In the fourth quarter of fiscal 2015 the Company received $1.5 million of net proceeds associated with Alara Capital exercising 1,002,818 of existing warrants (see Note 17, Exercise of Series C and Series D Warrants). Also in the fourth quarter of fiscal 2015 two customers formally accepted initial units of the Company’s new Advanced Signal Generation System. With initial customer acceptance of Advanced Signal Generation System units, similar units of the new platform are in production for potential future sales to customers. The Company could experience longer than anticipated sales cycles or delays in production and shipping volume quantities of the Advanced Signal Generation System, however, the Company believes the Advanced Signal Generation System will significantly contribute to the Company’s long term success. Furthermore management expects the Company’s cash and liquidity needs will be met through fiscal 2016, even if the Company experiences such delays. On June 1, 2015 the Company entered into a two year $2.5 million Revolving Accounts Receivable Line of Credit agreement with Bridge Bank N.A (“Bridge Bank”). The Bridge Bank credit facility replaced the line of credit with SVB, which expired April 15, 2015. The $2.5 million credit facility includes $500,000 of available borrowing not based on accounts receivables. (see Note 18, Subsequent Events).

Given the improved net loss and operating income in fiscal 2015, the $1.5 million of cash received in the fourth quarter of fiscal 2015 from the Alara Capital warrant exercise, the $2.5 million June 1, 2015 Bridge Bank Revolving Accounts Receivable Line of Credit agreement, and management’s forecasts of the Company’s cash flows for fiscal 2016, management believes the Company will have the necessary liquidity to continue its operations at least for the next twelve months.

 Contractual Obligations

The Company leases its facility under an operating lease that expires in December 2016 and leases certain equipment under operating leases. Total future minimum lease payments under these leases amount to approximately $1.3 million.

The Company leases equipment under capital leases that expire through May 2019. The future minimum lease payments under these leases are approximately $158,000.

18

The Company is committed to repay the PFG loan with a maturity date of January 2017. Future payments under this loan consist of $1.3 million in principal and $110,000 in interest.

The Company is committed to purchase certain inventory under non-cancelable purchase orders. As of March 28, 2015, total non–cancelable purchase orders were approximately $1.6 million and are scheduled to be delivered to the Company at various dates through March 2016.

Critical Accounting Policies

The Company’s discussion and analysis of its financial condition and the results of operations are based upon the consolidated financial statements included in this report and the data used to prepare them. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and management is required to make judgments, estimates and assumptions in the course of such preparation. The Summary of Significant Accounting Policies included with the consolidated financial statements describes the significant accounting policies and methods used in the preparation of the consolidated financial statements. On an ongoing basis, the Company re-evaluates its judgments, estimates and assumptions. The Company bases its judgment and estimates on historical experience, knowledge of current conditions, and its beliefs of what could occur in the future considering available information. Actual results may differ from these estimates under different assumptions or conditions. Management of Giga-tronics has identified the following as the Company’s critical accounting policies:

Revenue Recognition

Revenues are recognized when there is evidence of an arrangement, delivery has occurred, the price is fixed or determinable, and collectability is reasonably assured. This generally occurs when products are shipped and the risk of loss has passed. Revenue related to products shipped subject to customers’ evaluation is recognized upon final acceptance. Revenue recognized under the milestone method is recognized once milestones are met. Determining whether a milestone is substantive is a matter of judgment and that assessment is performed only at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

a. It is commensurate with either of the following:

1. The Company’s performance to achieve the milestone

2. The enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the Company's performance to achieve the milestone.

b. It relates solely to past performance.

c. It is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

Milestones for revenue recognition are agreed upon with the customer prior to the start of the contract and some milestones will be tied to product shipping while others will be tied to design review.

On certain contracts with one of the Company’s significant customers the Company receives payments in advance of manufacturing. Advanced payments are recorded as deferred revenue until the revenue recognition criteria described above have been met.

Product Warranties

The Company’s warranty policy generally provides one to three years of coverage depending on the product. The Company records a liability for estimated warranty obligations at the date products are sold. The estimated cost of warranty coverage is based on the Company’s actual historical experience with its current products or similar products. For new products, the required reserve is based on historical experience of similar products until sufficient historical data has been collected on the new product. Adjustments are made as new information becomes available.

19

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are stated at their net realizable values. The Company has estimated an allowance for uncollectible accounts based on analysis of specifically identified problem accounts, outstanding receivables, consideration of the age of those receivables, the Company’s historical collection experience, and adjustments for other factors management believes are necessary based on perceived credit risk.

Inventory

Inventories are stated at the lower of cost or market. Cost is determined on a first-in, first-out basis. The Company periodically reviews inventory on hand to identify and write down excess and obsolete inventory based on estimated product demand.

Income Taxes

Income taxes are accounted for using the asset and liability method.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  Future tax benefits are subject to a valuation allowance when management is unable to conclude that its deferred tax assets will more likely than not be realized.  The ultimate realization of deferred tax assets is dependent upon generation of future taxable income during the periods in which those temporary differences become deductible.  Management considers both positive and negative evidence and tax planning strategies in making this assessment.

The Company considers all tax positions recognized in the consolidated financial statements for the likelihood of realization.  When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the positions taken or the amounts of the positions that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority.  The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above, if any, would be reflected as unrecognized tax benefits, as applicable, in the accompanying consolidated balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination.  The Company recognizes accrued interest and penalties, if any, related to unrecognized tax benefits as a component of the provision for income taxes in the consolidated statements of operations.

Share Based Compensation

The Company has a stock incentive plan that provides for the issuance of stock options and restricted stock to employees and directors. The Company calculates share based compensation expense for stock options using a Black-Scholes-Merton option pricing model and records the fair value of stock option and restricted stock awards expected to vest over the requisite service period. In so doing, the Company makes certain key assumptions in making estimates used in the model. The Company believes the estimates used, which are presented in Note 10 of Notes to Consolidated Financial Statements, are appropriate and reasonable.

20

Off-Balance-Sheet Arrangements

The Company has no other off-balance-sheet arrangements (including standby letters of credit, guaranties, contingent interests in transferred assets, contingent obligations indexed to its own stock or any obligation arising out of a variable interest in an unconsolidated entity that provides credit or other support to the Company), that have or are likely to have a material effect on its financial conditions, changes in financial conditions, revenue, expense, results of operations, liquidity, capital expenditures or capital resources.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Pursuant to Item 305 of Regulation S-K, the Company, as a smaller reporting company, is not required to provide the information required by this item.

21

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index To Financial Statements And Schedules

Financial Statements	Page
Consolidated Balance Sheets - As of March 28, 2015 and March 29, 2014	23
Consolidated Statements of Operations - Years ended March 28, 2015 and March 29, 2014	24
Consolidated Statements of Shareholders’ Equity - Years ended March 28, 2015 and March 29, 2014	25
Consolidated Statements of Cash Flows - Years ended March 28, 2015 and March 29, 2014	26
Notes to Consolidated Financial Statements	27-45
Report of Independent Registered Public Accounting Firm	46

22

CONSOLIDATED BALANCE SHEETS

(In thousands except share data)	March 28, 2015			March 29, 2014
Assets
Current assets:
Cash and cash-equivalents	$	1,170		$	1,059
Trade accounts receivable, net of allowance of $45 and $44, respectively		2,354			1,846
Inventories, net		3,365			3,321
Prepaid expenses and other current assets		373			349
Total current assets		7,262			6,575
Property and equipment, net		718			949
Other long term assets		74			69
Total assets	$	8,054		$	7,593
Liabilities and shareholders' equity
Current liabilities:
Line of credit	$	—		$	1,165
Current portion of long term debt		811			200
Accounts payable		973			1,430
Accrued payroll and benefits		678			755
Deferred revenue		1,127			1,329
Deferred rent		127			104
Capital lease obligations		69			147
Other current liabilities		501			472
Total current liabilities		4,286			5,602
Long term loan and warrant debt, net of discounts		392			672
Derivative liability, at estimated fair value		252			128
Long term obligations - deferred rent		111			237
Long term obligations - capital lease		58			77
Total liabilities		5,099			6,716
Commitments and contingencies
Shareholders' equity:
Convertible preferred stock of no par value; Authorized - 1,000,000 shares
Series A - designated 250,000 shares; no shares at March 28, 2015 and March 29, 2014 issued and outstanding		—			—
Series B, C, D- designated 19,500 shares; 18,533.51 shares at March 28, 2015 and March 29, 2014 issued and outstanding; (liquidation preference of $3,540 at March 28, 2015 and March 29, 2014)		2,911			2,911
Common stock of no par value; Authorized - 40,000,000 shares; 6,706,065 shares at March 28, 2015 and 5,181,247 at March 29, 2014 issued and outstanding		19,975			16,224
Accumulated deficit		(19,931	)		(18,258	)
Total shareholders' equity		2,955			877
Total liabilities and shareholders' equity	$	8,054		$	7,593

See Accompanying Notes to Consolidated Financial Statements

23

CONSOLIDATED STATEMENTS OF OPERATIONS

	Years Ended
(In thousands except per-share data)	March 28, 2015			March 29, 2014
Net sales	$	18,452		$	13,309
Cost of sales		10,445			8,811
Gross margin		8,007			4,498
Operating expenses:
Engineering		3,210			3,897
Selling, general and administrative		4,783			4,809
Restructuring		—			331
Total operating expenses		7,993			9,037
Operating income/(loss)		14			(4,539	)
Gain on sale of product line		—			913
Warrant expense		(1,232	)		—
Other loss		(2	)		(8	)
Interest expense:
Interest expense, net		(254	)		(106	)
Interest expense from accretion of loan and warrant debt discounts		(152	)		—
Total interest expense		(406	)		(106	)
Loss before income taxes		(1,626	)		(3,740	)
Provision for income taxes		47			2
Net loss	$	(1,673	)	$	(3,742	)
Loss per common share – basic	$	(0.32	)	$	(0.74	)
Loss per common share – diluted	$	(0.32	)	$	(0.74	)
Weighted average common shares used in per share calculation:
Basic		5,279			5,058
Diluted		5,279			5,058

 See Accompanying Notes to Consolidated Financial Statements

24

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

	Preferred Stock				Common Stock				Accumulated
(In thousands except share data)	Shares		Amount		Shares		Amount		Deficit			Total
Balance at March 30, 2013		13,422	$	2,454		5,079,747	$	15,132	$	(14,278	)	$	3,308
Net loss										(3,742	)		(3,742	)
Restricted stock granted						71,500
Stock granted without restrictions						30,000
Share based compensation								494					494
Series D preferred stock issuance, net of offering costs of $41		5,112		457				598		(238	)		817
Balance at March 29, 2014		18,534		2,911		5,181,247		16,224		(18,258	)		877
Net loss										(1,673	)		(1,673	)
Restricted stock granted						432,000		—
Option exercises						90,000		163					163
Share based compensation								827					827
Warrant charge expense						—		1,232					1,232
Warrant exercise and newly issued warrant, net of issuance cost						1,002,818		1,529					1,529
Balance at March 28, 2015		18,534	$	2,911		6,706,065	$	19,975	$	(19,931	)	$	2,955

See Accompanying Notes to Consolidated Financial Statements

25

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Years Ended
(In thousands)	March 28, 2015			March 29, 2014
Cash flows from operating activities:
Net loss	$	(1,673	)	$	(3,742	)
Adjustments to reconcile net loss to net cash used in operating activities:
Warrant issuance expense		1,232			—
Depreciation and amortization		311			284
Share based compensation		827			494
Accretion of discounts on loan and warrant debt		152			—
Change in deferred rent		(103	)		(81	)
Changes in operating assets and liabilities:
Trade accounts receivable		(508	)		(180	)
Inventories		(44	)		1,239
Prepaid expenses and other assets		(29	)		83
Accounts payable		(457	)		642
Accrued payroll and benefits		(77	)		(292	)
Deferred revenue		(202	)		(949	)
Other current liabilities		29			(33	)
Net cash used in operating activities		(542	)		(2,535	)
Cash flows from investing activities:
Purchases of property and equipment		(16	)		(228	)
Net cash used in investing activities		(16	)		(228	)
Cash flows from financing activities:
Proceeds from exercise and issuance of warrants, net of issuance costs of $42		1,529			—
Proceeds from exercise of stock options		163			—
Payments on capital leases		(158	)		(185	)
Proceeds from line of credit		8,624			5,917
Proceeds from issuance of debt		500			1,000
Repayments of line of credit		(9,789	)		(5,609	)
Repayments of debt		(200	)		—
Proceeds from issuance of preferred stock, net of issuance costs of $41		—			817
Net cash provided by financing activities		669			1,940
Increase/(Decrease) in cash and cash-equivalents		111			(823	)
Beginning cash and cash-equivalents		1,059			1,882
Ending cash and cash-equivalents	$	1,170		$	1,059
Supplementary disclosure of cash flow information:
Cash paid for income taxes	$	2		$	2
Cash paid for interest	$	219		$	106
Supplementary disclosure of noncash financing activities:
Equipment acquired under capital lease	$	61		$	254

See Accompanying Notes to Consolidated Financial Statements

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 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1     Summary of Significant Accounting Policies

The Company The accompanying consolidated financial statements include the accounts of Giga-tronics Incorporated (“Giga-tronics”) and its wholly-owned subsidiary, Microsource Incorporated (“Microsource”), collectively the “Company”. The Company’s corporate office and manufacturing facilities are located in San Ramon, California. Giga-tronics and its subsidiary company design, manufacture and market a broad line of test and measurement equipment used in the development, test, and maintenance of wireless communications products and systems, flight navigational equipment, electronic defense systems, and automatic testing systems. The Company also manufactures and markets a line of test, measurement, and handling equipment used in the manufacturing of semiconductor devices. The Company’s products are sold worldwide to customers in the test and measurement and semiconductor industries. The Company currently has no foreign-based operations or material amounts of identifiable assets in foreign countries. Its gross margins on foreign and domestic sales are similar, and all non-U.S. sales are transacted in U.S. dollars.

Principles of Consolidation The consolidated financial statements include the accounts of Giga-tronics and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.

Basis of Presentation The consolidated financial statements are presented on the assumption that the company will continue to operate as a going concern. Discussion of recent events that Management believes support this presentation are as follows:

In fiscal 2012 the Company began to invest heavily in the development of a new Giga-tronics Division product platform, the Advanced Signal Generation System. Delays in completing the Advanced Signal Generation System have contributed significantly to the losses of the Company. In fiscal 2015 the Company’s net loss was $1.7 million, which included a non-cash expense of $1.2 million related to the issuance of new warrants to Alara Capital and $152,000 of non-cash accretion of loan and warrant debt discounts. Also in fiscal 2015 the Company had operating income of $14,000, compared to an operating loss of $4.5 million in fiscal 2014.

In the fourth quarter of fiscal 2015 the Company received $1.5 million of net proceeds associated with Alara Capital exercising 1,002,818 of existing warrants (see Note 17, Exercise of Series C and Series D Warrants). Also in the fourth quarter of fiscal 2015 two customers formally accepted initial units of the Company’s new Advanced Signal Generation System. With initial customer acceptance of Advanced Signal Generation System units, similar units of the new platform are in production for potential future sales to customers. The Company could experience longer than anticipated sales cycles or delays in production and shipping volume quantities of the Advanced Signal Generation System, however, the Company believes the Advanced Signal Generation System will significantly contribute to the Company’s long term success. On June 1, 2015 the Company entered into a two year $2.5 million Revolving Accounts Receivable Line of Credit agreement with Bridge Bank. The Bridge Bank credit facility replaced the line of credit with SVB, which expired April 15, 2015. The $2.5 million credit facility includes $500,000 on a non-formula basis in addition to the Borrowing Base. (see Note 18, Subsequent Events).

Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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. Actual results could differ from those estimates.

Fiscal Year The Company’s financial reporting year consists of either a 52 week or 53 week period ending on the last Saturday of the month of March. Fiscal year 2015, ended on March 28, 2015 resulting in a 52 week year. Fiscal year 2014, ended on March 29, 2014 also resulting in a 52 week year. All references to years in the consolidated financial statements relate to fiscal years rather than calendar years.

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Reclassifications   Certain reclassifications, none of which affected the prior year’s net loss or shareholders’ equity, have been made to prior year balances in order to conform to the current year presentation.

Revenue Recognition and Deferred Revenue   The Company records revenue when there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed and determinable, and collectability is reasonably assured. This occurs when products are shipped or the customer accepts title transfer. If the arrangement involves acceptance terms, the Company defers revenue until product acceptance is received. On certain large development contracts, revenue is recognized upon achievement of substantive milestones. Determining whether a milestone is substantive is a matter of judgment and that assessment is performed only at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

a. It is commensurate with either of the following:

1. The Company’s performance to achieve the milestone.

2. The enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the Company's performance to achieve the milestone.

b. It relates solely to past performance.

c. It is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

Milestones for revenue recognition are agreed upon with the customer prior to the start of the contract and some milestones are based on product shipping while others are based on design review. In fiscal 2015 the Company’s Microsource business unit received a $6.5 million order from a major aerospace company for non-recurring engineering services to develop a variant of its high performance fast tuning YIG filters for an aircraft platform and to deliver a limited number of flight-qualified prototype hardware units (the “NRE Order”) which is being accounted for on a milestone basis. The Company considered factors such as estimated completion dates and product acceptance of the order prior to accounting for the NRE Order as milestone revenue. During the fiscal years ended March 28, 2015 and March 29, 2014, revenue recognized on a milestone basis were $4.7 million and $486,000, respectively.

On certain contracts with several of the Company’s significant customers the Company receives payments in advance of manufacturing. Advanced payments are recorded as deferred revenue until the revenue recognition criteria described above has been met.

Accounts receivable are stated at their net realizable value. The Company has estimated an allowance for uncollectable accounts based on analysis of specifically identified accounts, outstanding receivables, consideration of the age of those receivables, the Company’s historical collection experience, and adjustments for other factors management believes are necessary based on perceived credit risk.

The activity in the reserve account for doubtful accounts is as follows for the years ending March 28, 2015 and March 29, 2014:

(Dollars in thousands)	March 28, 2015		March 29, 2014
Beginning balance	$	44	$	35
Provisions (reversals of previous provisions) for doubtful accounts		1		22
Write-off of doubtful accounts		—		(13	)
Ending balance	$	45	$	44

Accrued Warranty The Company’s warranty policy generally provides one to three years of coverage depending on the product. The Company records a liability for estimated warranty obligations at the date products are sold. The estimated cost of warranty coverage is based on the Company’s actual historical experience with its current products or similar products. For new products, the required reserve is based on historical experience of similar products until such time as sufficient historical data has been collected on the new product. Adjustments are made as new information becomes available.

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Inventories Inventories are stated at the lower of cost or fair value using full absorption and standard costing. Cost is determined on a first-in, first-out basis. Standard costing and overhead allocation rates are reviewed by management periodically, but not less than annually. Overhead rates are recorded to inventory based on capacity management expects for the period the inventory will be held. Reserves are recorded within cost of sales for impaired or obsolete inventory when the cost of inventory exceeds its estimated fair value. Management evaluates the need for inventory reserves based on its estimate of the amount realizable through projected sales including an evaluation of whether a product is reaching the end of its life cycle. When inventory is discarded it is written off against the inventory reserve, as inventory generally has already been fully reserved for at the time it is discarded.

Research and Development Research and development expenditures, which include the cost of materials consumed in research and development activities, salaries, wages and other costs of personnel engaged in research and development, costs of services performed by others for research and development on the Company’s behalf and indirect costs are expensed as operating expenses when incurred. Research and development costs totaled approximately $3.2 million and $3.9 million for the years ended March 28, 2015 and March 29, 2014, respectively.

Property and Equipment   Property and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the respective assets, which range from three to ten years for machinery and equipment and office fixtures. Leasehold improvements and assets acquired under capital leases are amortized using the straight-line method over the shorter of the estimated useful lives of the respective assets or the lease term.

The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such review indicates that the carrying amount of an asset exceeds the sum of its expected future cash flows on an undiscounted basis, the asset’s carrying amount would be written down to fair value. Additionally, the Company reports long-lived assets to be disposed of at the lower of carrying amount or fair value less cost to sell. As of March 28, 2015 and March 29, 2014, management believes there has been no impairment of the Company’s long-lived assets.

Derivatives The Company accounts for free standing derivatives and embedded derivatives required to be bifurcated and accounted for on a stand-alone basis at estimated fair value. Changes in fair value are reported in earnings as other income or loss.

Deferred Rent Rent expense is recognized in an amount equal to the guaranteed base rent plus contractual future minimum rental increases amortized on the straight-line basis over the terms of the leases, including free rent periods.

Income Taxes Income taxes are accounted for using the asset and liability method.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  Future tax benefits are subject to a valuation allowance when management is unable to conclude that its deferred tax assets will more likely than not be realized.  The ultimate realization of deferred tax assets is dependent upon generation of future taxable income during the periods in which those temporary differences become deductible.  Management considers both positive and negative evidence and tax planning strategies in making this assessment.

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The Company considers all tax positions recognized in its financial statements for the likelihood of realization.  When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the positions taken or the amounts of the positions that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority.  The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above, if any, would be reflected as unrecognized tax benefits, as applicable, in the accompanying consolidated balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination.  The Company recognizes accrued interest and penalties, if any, related to unrecognized tax benefits as a component of the provision for income taxes in the consolidated statements of operations.

Product Development Costs The Company incurs pre-production costs on certain long-term supply arrangements. The costs, which represent non-recurring engineering and tooling costs, are capitalized as other assets and amortized over their useful life when reimbursable by the customer. All other product development costs are charged to operations as incurred. Capitalized pre-production costs included in inventory were immaterial as of March 28, 2015 and March 29, 2014.

Software Development Costs Development costs included in the research and development of new products and enhancements to existing products are expensed as incurred, until technological feasibility in the form of a working model has been established. To date, completion of software development has been concurrent with the establishment of technological feasibility, and accordingly, no costs have been capitalized.

Share-based Compensation The Company has established the 2005 Equity Incentive Plan, which provides for the granting of options for up to 2,250,000 shares of Common Stock. In 2014, the term of the 2005 Equity Incentive Plan was extended to 2025. The Company records share-based compensation expense for the fair value of all stock options and restricted stock that are ultimately expected to vest as the requisite service is rendered.

The cash flows resulting from the tax benefits resulting from tax deductions in excess of the compensation cost recognized for those options (excess tax benefits) are classified as cash flows from financing in the statements of cash flows. These excess tax benefits were not significant for the Company for the fiscal years ended March 28, 2015 or March 29, 2014.

In calculating compensation related to stock option grants, the fair value of each stock option is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. The computation of expected volatility used in the Black-Scholes-Merton option-pricing model is based on the historical volatility of Giga-tronics’ share price. The expected term is estimated based on a review of historical employee exercise behavior with respect to option grants. The risk free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. Expected dividend yield was not considered in the option pricing formula since the Company has not paid dividends and has no current plans to do so in the future.

The fair value of restricted stock awards is based on the fair value of the underlying shares at the date of the grant. Management makes estimates regarding pre-vesting forfeitures that will impact timing of compensation expense recognized for stock option and restricted stock awards.

Earnings or Loss Per Common Share Basic earnings or loss per common share is computed using the weighted average number of common shares outstanding during the period. Diluted earnings per share incorporate the incremental shares issuable upon the assumed exercise of stock options and warrants using the treasury stock method. Anti-dilutive options are not included in the computation of diluted earnings per share. Non-vested shares of restricted stock have nonforfeitable dividend rights and are considered participating securities for the purpose of calculating basic and diluted earnings per share under the two-class method.

Comprehensive Income or Loss   There are no items of comprehensive income or loss other than net income or loss.

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Financial Instruments and Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk consist of cash, cash-equivalents and trade accounts receivable. The Company’s cash-equivalents consist of overnight deposits with federally insured financial institutions. Concentration of credit risk in trade accounts receivable results primarily from sales to major customers. The Company individually evaluates the creditworthiness of its customers and generally does not require collateral or other security. At March 28, 2015, and March 29, 2014, three customers combined accounted for 65% of consolidated gross accounts receivable.

Fair Value of Financial Instruments and Fair Value Measurements   The Company’s financial instruments consist principally of cash and cash-equivalents, line of credit, term debt, warrant liability and warrant derivative liability. The fair value of a financial instrument is the amount at which the instrument could be exchanged in an orderly transaction between market participants to sell the asset or transfer the liability. The Company uses fair value measurements based on quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity can access as of the measurement date (Level 1), significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data (Level 2), or significant unobservable inputs reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability (Level 3), depending on the nature of the item being valued.

The carrying amounts of the Company’s cash and cash-equivalents and line of credit approximate their fair values at each balance sheet date due to the short-term maturity of these financial instruments. The fair values of term debt and warrant debt are based on the present value of expected future cash flows and assumptions about current interest rates and the creditworthiness of the Company (Level 3). At March 28, 2015 the carrying amounts of the Company’s term debt and warrant debt totaled $1.1 million and $82,000, respectively. At March 28, 2015 the estimated fair values of the Company’s term debt and warrant debt totaled $1.2 million and $112,000, respectively. At March 29, 2014, the carrying amounts of the Company’s term debt and warrant debt totaled $822,000 and $50,000, respectively, and the carrying amounts approximated fair value since the agreement was entered into near the balance sheet date. The fair value of the bifurcated conversion feature represented by the warrant derivative liability which is measured at fair value on a recurring basis is based on a Black Scholes option pricing model with assumptions for stock price, exercise price, volatility, expected term, risk free interest rate and dividend yield similar to those described previously for share-based compensation which were generally observable (Level 2). The Company had no assets or liabilities measured at fair value on a non-recurring basis, nor were there any transfers between Level 1 and Level 2 of the fair value hierarchy.

Recently Issued Accounting Standards

In April 2014, the Financial Accounting Standards Board (FASB) issued an accounting standard update that changes the criteria for reporting discontinued operations. Under the accounting standard update, a disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has, or will have, a major effect on an entity’s operations and financial results when either it qualifies as held for sale, disposed of by sale, or disposed of other than by sale. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2016. The Company is currently evaluating the impact of this accounting standard update on its Consolidated Financial Statements.

In May 2014, the FASB amended the accounting standards by creating a new Topic 606 which is in response to a joint initiative of the FASB and the International Accounting Standards Board to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. generally accepted accounting principles and international financial reporting standards that would:

1. Remove inconsistencies and weaknesses in revenue requirements.

2. Provide a more robust framework for addressing revenue issues.

3. Improve comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets.

4. Provide more useful information to users of financial statements through improved disclosure requirements.

5. Simplify the preparation of financial statements by reducing the number of requirements to which an entity must refer.

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For a public entity, the amendments in this Update are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early application is not permitted. The Company is currently evaluating the impact this new accounting standard will have on its financial statements.

In June 2014, the FASB amended ASC 718, Share Based Compensation, to require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. For all entities, the amendments in this update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The Company is currently evaluating the impact this accounting standard update may have on its financial statements.    

In August 2014, the FASB issued ASU 2014-15 which provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity’s ability to continue as a going concern. The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The Company is currently evaluating the impact this accounting standard update may have on its financial statements.

In April 2015, the FASB issued ASU 2015-03, “Interest - Imputation of Interest (Subtopic 835-30) – Simplifying the Presentation of Debt Issuance Costs,” or ASU 2015-03. ASU 2015-03 simplifies the presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct reduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by this ASU. The amendments in this ASU are effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The adoption of this ASU by the Company will change the presentation of debt issuance costs, which will be reported as a direct offset to the applicable debt on the balance sheet.

2     Cash and Cash-Equivalents

Cash and cash-equivalents of $1.2 million and $1.1 million at March 28, 2015 and March 29, 2014, respectively, consisted of demand deposits with a financial institution that is a member of the Federal Deposit Insurance Corporation (FDIC). At March 28, 2015, $827,000 of the Company’s demand deposits exceeded FDIC insurance limits.

3     Inventories

Inventories, net of reserves, consisted of the following:

(Dollars in thousands)	March 28, 2015		March 29, 2014
Raw materials	$	1,631	$	1,501
Work-in-progress		1,598		1,400
Finished goods		15		353
Demonstration inventory		121		67
Total	$	3,365	$	3,321

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4     Property, Plant and Equipment, net

Property, plant and equipment, net is comprised of the following:

(Dollars in thousands)	March 28, 2015			March 29, 2014
Leasehold improvements	$	327			327
Machinery and equipment		4,130			3,863
Computer and software		459			388
Furniture and office equipment		325			325
Construction in progress		—			227
		5,241			5,130
Less: accumulated depreciation and amortization		(4,523	)		(4,181	)
Total	$	718		$	949

 5     Gain on Sale of Product Line

On March 18, 2013, the Company entered into an Asset Purchase Agreement with Teradyne Inc. (Teradyne), whereby Teradyne agreed to purchase the Giga-tronics Division product line known as SCPM for $1.0 million, resulting in a net gain of $913,000 during fiscal 2014.

6     Selling and Advertising Expenses

Selling expenses consist primarily of salaries to employees and commissions paid to various sales representatives and marketing agencies. Commission expense totaled $237,000 and $196,000 for fiscal 2015 and 2014, respectively. Advertising costs, which are expensed as incurred, totaled $7,000 and $14,000 for fiscal 2015 and 2014, respectively.

7     Significant Customers and Industry Segment Information

The Company has two reportable segments: Giga-tronics Division and Microsource. Giga-tronics Division produces a broad line of test and measurement equipment used in the development, test and maintenance of wireless communications products and systems, flight navigational equipment, electronic defense systems and automatic testing systems and designs, manufactures, and markets a line of switching devices that link together many specific purpose instruments that comprise automatic test systems. Microsource develops and manufactures a broad line of Yttrium, Iron and Garnet (YIG) tuned oscillators, filters and microwave synthesizers, which are used in a wide variety of microwave instruments or devices.

The accounting policies for the segments are the same as those described in the "Summary of Significant Accounting Policies". The Company evaluates the performance of its segments and allocates resources to them based on earnings before income taxes. Segment net sales include sales to external customers. Inter-segment activities are eliminated in consolidation. Assets include accounts receivable, inventories, equipment, cash, deferred income taxes, prepaid expenses and other long-term assets. The Company accounts for inter-segment sales and transfers at terms that allow a reasonable profit to the seller. During the periods reported there were no significant inter-segment sales or transfers.

The Company's reportable operating segments are strategic business units that offer different products and services. They are managed separately because each business utilizes different technology and requires different accounting systems. The Company’s chief operating decision maker is considered to be the Company’s Chief Executive Officer (“CEO”). The CEO reviews financial information presented on a consolidated basis accompanied by disaggregated information about revenues and pre-tax income or loss by operating segment.

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The tables below present information for the fiscal years ended in 2015 and 2014.

March 28, 2015 (Dollars in thousands)	Giga-tronics Division			Microsource		Total
Revenue	$	9,123		$	9,329	$	18,452
Other expense		(1,386	)		—		(1,386	)
Interest expense, net		(254	)		—		(254	)
Depreciation and amortization		277			34		311
Capital expenditures		81			—		81
Income/(Loss) before income taxes		(6,110	)		4,484		(1,626	)
Assets		6,103			1,951		8,054

March 29, 2014 (Dollars in thousands)	Giga-tronics Division			Microsource			Total
Revenue	$	7,290		$	6,019		$	13,309
Interest expense, net		(106	)		—			(106	)
Depreciation and amortization		251			33			284
Capital expenditures		482			—			482
Loss before income taxes		(3,531	)		(209	)		(3,740	)
Assets		5,442			2,151			7,593

The Company’s Giga-tronics Division and Microsource segments sell to agencies of the U.S. government and U.S. defense-related customers. In fiscal 2015 and 2014, U.S. government and U.S. defense-related customers accounted for 69% and 57% of sales, respectively. During fiscal 2015, one customer accounted for 28% of the Company’s consolidated revenues at March 28, 2015 and was included in the Microsource segment. A second customer accounted for 23% of the Company’s consolidated revenues at March 28, 2015 and was also included in the Microsource segment. A third customer accounted for 14% of the Company’s consolidated revenues during fiscal 2015 and was included in the Giga-tronics Division reporting segment.

During fiscal 2014, one customer accounted for 39% of the Company’s consolidated revenues at March 29, 2014 and was included in the Microsource segment. A second customer accounted for 16% of the Company’s consolidated revenues at March 29, 2014 and was included in the Giga-tronics Division.

Export sales accounted for 8% and 11% of the Company’s sales in fiscal 2015 and 2014, respectively. Export sales by geographical area for these fiscal years are shown below:

(Dollars in thousands)	March 28, 2015		March 29, 2014
Americas	$	26	$	169
Europe		179		661
Asia		1,085		507
Rest of world		177		140
Total	$	1,467	$	1,477

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8     Loss per Common Share

Net loss and common shares used in per share computations for the fiscal years ended March 28, 2015 and March 29, 2014 are as follows:

(In thousands except per-share data)	March 28, 2015			March 29, 2014
Net loss	$	(1,673	)	$	(3,742	)
Weighted average:
Common shares outstanding		5,279			5,058
Potential common shares		—			—
Common shares assuming dilution		5,279			5,058
Loss per common share – basic	$	(0.32	)	$	(0.74	)
Loss per common share – diluted	$	(0.32	)	$	(0.74	)
Stock options not included in computation that could potentially dilute EPS in the future		1,727			1,739
Restricted stock awards not included in computation that could potentially dilute EPS in the future		482			122
Convertible preferred stock not included in computation that could potentially dilute EPS in the future		1,853			1,853
Warrants not included in computation that could potentially dilute EPS in the future		1,368			1,317

The stock options, restricted stock, convertible preferred stocks and warrants not included in the computation of diluted earnings per share (EPS) for the fiscal years ended March 28, 2015 and March 29, 2014 is a result of the Company’s net loss and, therefore, the effect of these instrument would be anti-dilutive.

9     Income Taxes

Following are the components of the provision for income taxes:

Fiscal years ended (In thousands)	March 28, 2015			March 29, 2014
Current
Federal	$	—		$	—
State		47			2
Total current		47			2
Deferred
Federal		210			(568	)
State		391			(330	)
Total deferred		601			(898	)
Change in liability for uncertain tax positions		23			1,579
Change in valuation allowance		(624	)		(681	)
Provision for income taxes	$	47		$	2

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The tax effects of temporary differences that give rise to significant portions of the deferred tax assets are as follows:

Fiscal years ended (In thousands)	March 28, 2015			March 29, 2014
Net operating loss carryforwards	$	13,657		$	14,300
Income tax credits		306			143
Inventory reserves and additional costs capitalized		1,974			2,051
Accrued vacation		133			129
Deferred rent		95			136
Non-qualified stock options and restricted stock		247			211
Other		48			114
Total deferred tax assets		16,460			17,084
Valuation allowance		(16,460	)		(17,084	)
Net deferred tax assets	$	—		$	—

The following summarizes the difference between the income tax expense and the amount computed by applying the statutory federal income tax rate of 34% to income before income tax. The items comprising these differences consisted of the following for the fiscal years ended March 28, 2015 and March 29, 2014:

Fiscal years ended (In thousands except percentages)	March 28, 2015					March 29, 2014
Statutory federal income tax (benefit)	$	(553	)	34	%	$	(1,256	)	34	%
Valuation allowance		(624	)	38.4			681		(18.4	)
State income tax, net of federal benefit		(95	)	5.8			(216	)	5.8
Net operating loss expiration		861		(53.0	)		—		—
Non tax-deductible expenses		593		(36.5	)		132		(3.6	)
Tax credits		(187	)	11.5			2,238		(60.6	)
Liability for uncertain tax positions		23		(1.4	)		(1,579	)	42.8
Other		29		(1.8	)		2		(0.1	)
Effective income tax	$	47		3.0	%	$	2		(0.1	)%

The decrease in valuation allowance from March 29, 2014 to March 28, 2015 was $624,000.

As of March 28, 2015, the Company had pre-tax federal net operating loss carryforwards of $35.9 million and state net operating loss carryforwards of $25.0 million available to reduce future taxable income. The federal and state net operating loss carryforwards begin to expire from fiscal 2023 through 2035 and from 2015 through 2035, respectively. Utilization of net operating loss carryforwards may be subject to annual limitations due to certain ownership change limitations as required by Internal Revenue Code Section 382. The federal income tax credits begin to expire from 2021 through 2035 and state income tax credit carryforwards are carried forward indefinitely.

The Company has recorded a valuation allowance to reflect the estimated amount of deferred tax assets, which may not be realized. The ultimate realization of deferred tax assets is dependent upon generation of future taxable income during the periods in which those temporary differences become deductible. Management considers both positive and negative evidence and tax planning strategies in making this assessment.

As of March 28, 2015, the Company recorded unrecognized tax benefits of $93,000 related to uncertain tax positions. The unrecognized tax benefit is netted against the noncurrent deferred tax asset on the Consolidated Balance Sheet. The Company has not recorded a liability for any penalties or interest related to the unrecognized tax benefits.

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The Company files U.S federal and California state income tax returns. The Company is generally no longer subject to tax examinations for years prior to the fiscal year 2012 for federal purposes and fiscal year 2011 for California purposes, except in certain limited circumstances. The Company does have a California Franchise Tax Board audit that is pending. The Company is working with the California Franchise Tax Board to resolve all audit issues and does not believe any material taxes or penalties are due. However, as a result of the ongoing examination, the Company eliminated certain income tax credit carryovers in fiscal 2014.  The write-off of these income tax credit carryovers did not have a significant impact on total income tax expense as the majority had an uncertain tax position reserve with the balance having a full valuation allowance against the deferred tax asset.

A reconciliation of the beginning and ending amount of the liability for uncertain tax positions, excluding potential interest and penalties, is as follows:

(In thousands)	Fiscal Year 2015		Fiscal Year 2014
Balance as of beginning of year	$	70	$	1,649
Additions based on current year tax positions		23		—
(Reductions) additions for prior year tax positions		—		(1,579	)
Balance as of end of year	$	93	$	70

The total amount of interest and penalties related to unrecognized tax benefits at March 28, 2015 is not material. The amount of tax benefits that would impact the effective rate, if recognized, is not expected to be material. The Company does not anticipate any significant changes with respect to unrecognized tax benefits within next twelve (12) months.

10     Share-based Compensation and Employee Benefit Plans

Share-based Compensation The Company has established the 2000 Stock Option Plan and the 2005 Equity Incentive Plan, which provide for the granting of options and restricted stock for up to 2,250,000 shares of common stock at 100% of fair market value at the date of grant, with each grant requiring approval by the Board of Directors of the Company. Option grants under the 2000 Stock Option Plan are no longer available. Options granted generally vest in one or more installments in a four or five year period and must be exercised while the grantee is employed by the Company or within a certain period after termination of employment. Options granted to employees shall not have terms in excess of 10 years from the grant date. Holders of options may be granted stock appreciation rights (SAR), which entitle them to surrender outstanding options for a cash distribution under certain changes in ownership of the Company, as defined in the stock option plan. As of March 28, 2015, no SAR’s have been granted under the option plan. As of March 28, 2015, the total number of shares of common stock available for issuance is 397,425. All outstanding options have either a five year or a ten year life.

The weighted average grant date fair value of stock options granted during the fiscal years ended March 28, 2015 and March 29, 2014 was $1.66 and $1.07, respectively, and was calculated using the following weighted-average assumptions:

Fiscal years ended	March 28, 2015			March 29, 2014
Dividend yield		—			—
Expected volatility		92	%		86	%
Risk-free interest rate		1.61	%		1.02	%
Expected term (years)		8.34			7.91

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A summary of the changes in stock options outstanding for the fiscal years ended March 28, 2015 and March 29, 2014 is presented below:

					Weighted Average
			Weighted Average		Remaining Contractual		Aggregate Intrinsic
(Dollars in thousands except share prices)	Shares		Exercise Price		Terms (Years)		Value
Outstanding at March 30, 2013		1,556,250	$	1.62		6.8	$	252
Granted		430,750		1.32
Exercised		—		—
Forfeited / Expired		248,250		1.72
Outstanding at March 29, 2014		1,738,750	$	1.53		6.8	$	113
Granted		306,500		2.01
Exercised		90,000		1.80
Forfeited / Expired		228,275		1.81
Outstanding at March 28, 2015		1,726,975	$	1.57		6.9	$	219
Exercisable at March 28, 2015		618,975	$	1.62		6.1	$	59
At March 28, 2015, expected to vest in the future		761,212	$	1.54		7.4	$	107

 As of March 28, 2015, there was $1.2 million of total unrecognized compensation cost related to non-vested options and restricted stock granted under the 2005 Plan and outside of the 2005 Plan. That cost is expected to be recognized over a weighted average period of 2.5 years and will be adjusted for subsequent changes in estimated forfeitures. There were 280,650 and 320,525 options vested during the fiscal years ended March 28, 2015 and March 29, 2014 respectively. The total fair value of options vested during the fiscal years ended March 28, 2015 and March 29, 2014 was $120,000 and $365,000, respectively. Cash received from the exercise of stock options during fiscal 2015 was $163,000. No cash was received from the exercise of stock options in fiscal 2014. Share based compensation cost recognized in operating results for the fiscal years ended March 28, 2015 and March 29, 2014 totaled $370,000 and $310,000, respectively.

Included in the total options outstanding at March 28, 2015 are performance-based options for 100,000 shares granted, which were granted outside of the 2005 Plan. All of the options vest following the filing of the Company’s Form 10-K for fiscal 2015 given certain bookings goals that were achieved by the Company. Compensation cost recognized in fiscal 2015 related to these options were $29,000, and no compensation cost was recognized for these stock options during fiscal 2014 because management did not believe the performance criteria would be met.

During the year ended March 29, 2014, the vesting for 40,000 options was accelerated in connection with a termination agreement with a former employee. This modification did not result in any incremental compensation expense, however $7,000 of stock-based compensation expense was accelerated and recognized during the year ended March 29, 2014.

Restricted Stock

The Company granted 432,000 shares of restricted stock during fiscal 2015 to certain members of the Board of Directors in lieu of services to be performed in fiscal 2015 and fiscal 2016. The weighted average grant date fair value was $2.11. In fiscal 2014, the Company granted 71,500 shares of restricted stock to certain members of the Board of Directors in lieu of cash compensation for services to be performed in fiscal 2014. The weighted average grant date fair value was $1.53. The Company also granted 30,000 shares of unrestricted stock during 2014 as part of a severance agreement with a former employee. The 30,000 shares did not have a restriction period because they vested immediately on the grant date, but are included in the roll forward schedule of restricted stock below because they were granted under the 2005 Plan. The Company granted 50,000 shares of restricted stock outside the 2005 Plan in fiscal 2013. The restricted stock awards are considered fixed awards as the number of shares and fair value at the grant date is amortized over the requisite service period net of estimated forfeitures. Compensation cost recognized for restricted stock awards for 2015 and 2014 totaled $457,000 and $184,000, respectively.

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A summary of the changes in non-vested restricted stock awards outstanding for the fiscal years ended March 28, 2015 and March 29, 2014 is presented below:

			Weighted
			Average Grant
	Shares		Date Fair Value
Non-vested at March 30, 2013		50,000	$	1.18
Granted		101,500		1.53
Forfeited or cancelled		30,000		1.53
Non-vested at March 29, 2014		121,500	$	1.39
Granted		432,000		2.11
Vested		71,500		1.53
Forfeited or cancelled		—		—
Non-vested at March 28, 2015		482,000	$	2.02

401(k) Plans The Company has established 401(k) plans which cover substantially all employees. Participants may make voluntary contributions to the plans for up to 100% of their defined compensation. The Company matches a percentage of the participant’s contributions in accordance with the plan. Participants vest ratably in Company contributions over a four-year period. Company contributions to the plans for fiscal 2015 and 2014 were approximately $39,000 and $44,000, respectively.

11     Commitments and Contingencies

The Company leases a 47,300 square foot facility located in San Ramon, California that expires in December 31, 2016. The Company leased a 33,400 square foot facility located in Santa Rosa, California, under a lease that expired May 31, 2013. The Company did not extend the Santa Rosa lease and vacated the facility on May 31, 2013. All of the Company’s operations are in the San Ramon facility as of March 28, 2015.

The Company also leases certain other equipment under operating leases.

Total future minimum lease payments under these leases are as follows.

Fiscal year (Dollars in thousands)
2016		758
2017		523
2018		—
2019		—
Thereafter		—
Total	$	1,281

The aggregate rental expense was $654,000 and $630,000 in fiscal 2015 and 2014, respectively.

The Company leases certain equipment under capital leases that expire through May 2019. Capital leases with costs totaling $319,000 and $456,000 are reported net of accumulated depreciation of $60,000 and $91,000 at March 28, 2015 and March 29, 2014, respectively.

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Total future minimum lease payments under these capital leases are as follows.

Fiscal year (Dollars in thousands)	Principal		Interest		Total
2016	$	69	$	14	$	83
2017		17		9		26
2018		20		6		26
2019		18		2		20
2020		3		—		3
Total	$	127	$	31	$	158

The Company is committed to purchase certain inventory under non-cancelable purchase orders. As of March 28, 2015, total non–cancelable purchase orders were approximately $1.6 million and are scheduled to be delivered to the Company at various dates through March 2016.

A sole distributor of certain products has made a claim for commissions in connection with prior and future sales by the company for products that the Company believes are excluded from the distribution agreement. The potential liability from the claim, if any, cannot be reasonably estimated at this time.

12     Warranty Obligations

The Company records a liability in cost of sales for estimated warranty obligations at the date products are sold. Adjustments are made as new information becomes available. The following provides a reconciliation of changes in the Company’s warranty reserve. The Company provides no other guarantees.

(Dollars in thousands)	March 28, 2015			March 29, 2014
Balance at beginning of year	$	61		$	114
Provision, net		81			(5	)
Warranty costs incurred		(66	)		(48	)
Balance at end of year	$	76		$	61

 13     Restructuring

During fiscal 2013, the Company took steps to reduce current and future expenses by reducing staff and by combining the operations in Santa Rosa into its San Ramon facility. This physical move was completed on May 31, 2013. Certain employee retention agreements were extended through December 2013. Substantially all of the restructuring costs were for the Microsource reportable segment. As of March 29, 2014 the Company had expensed $780,000 related to these restructuring costs. There were no restructuring costs during fiscal 2015 and the Company does not anticipate any additional restructuring costs. Restructuring costs during fiscal 2014 were $331,000.

14     Line of Credit

On June 11, 2013 the Company entered into an amendment to the Second Amended Credit Facility (the “New Amended Credit Facility”) with Silicon Valley Bank (the “Bank”). The New Amended Credit Facility amended the Second Amended Credit Facility by expanding the definition of eligible accounts, increasing the maximum limit, and extending the maturity date. The New Amended Credit Facility, which expired on April 15, 2015 and was replaced on June 1, 2015 with a $2.5 million line of credit with Bridge Bank (see Note 18, Subsequent Events), was secured by all assets of the Company and provided for a borrowing capacity equal to 80% of eligible accounts receivable (70% of eligible foreign accounts receivable) on an aggregate basis, up to a maximum $3.0 million, provided the Company maintained borrowing base eligibility, that is, a minimum of $750,000 of cash in excess of its line of credit liability.

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The Second Amended Credit Facility and New Amended Credit Facility contained a collateral handling fee of one-tenth of one percent (0.10%) on outstanding financed receivables for each calendar month based upon a 360 day year. When the Company was borrowing base eligible, the collateral handling fee was not applicable. Interest accrued on the average outstanding borrowings at a floating per annum rate equal to the greater of the Prime Rate plus two percent (2.00%) or six percent (6.00%). When the Company was borrowing base eligible, any borrowings under the New Amended Credit Facility could be repaid and such repaid amounts re-borrowed until the maturity date. When the Company was not borrowing base eligible, advances were made on the New Amended Credit facility on individual accounts receivable and the Company was required to instruct its customers to remit payments to a lockbox at the Bank and when the Company was not borrowing base eligible, such payments are applied by the Bank to the line of credit to the extent monies were advanced to the Company based on such specific accounts receivable.  As of March 28, 2015, the Company was borrowing base eligible however there were no borrowings at March 28, 2015.

As of March 28, 2015, the maximum borrowing capacity under the Line of Credit was $1.8 million, of which the entire amount was available. The Bank may have terminated or suspended the Company’s right to advances under the line of credit if the Bank had determined there had been a material adverse change in the Company’s general affairs, financial forecasts or general ability to repay.

On June 16, 2014 the Company amended the term loan agreement with PFG creating a $500,000 revolving line of credit on which the Company drew $500,000. (see Note 15, Term Loan , Revolving Line of Credit and Warrants). 

15       Term Loan, Revolving Line of Credit and Warrants

On March 13, 2014 the Company entered into a three year, $2.0 million term loan agreement with PFG under which the Company received $1.0 million on March 14, 2014. Pursuant to the agreement, the Company had the ability to borrow an additional $1.0 million following the Company’s achievement of certain performance milestones which includes achieving $7.5 million in net sales during the first half of fiscal 2015 and two consecutive quarters of net income greater than zero during fiscal 2015.

On June 16, 2014, the Company amended its loan agreement with PFG (the “Amendment”). Under the terms of the Amendment, PFG made a revolving credit line available to Giga-tronics in the amount of $500,000, and the Company borrowed the entire amount on June 17, 2014. The revolving line has a thirty-three month term. The Amendment reduced the future amount potentially available for the Company to borrow under the PFG Loan agreement from $1.0 million to $500,000.

On June 3, 2015, the Company further amended its loan agreement with PFG (the “Second Amendment”). The Second Amendment cancelled the additional $500,000 that was available to the Company under the June 2014 Amendment (see Note 18, Subsequent Events).

Interest on the initial $1.0 million term loan is fixed at 9.75% and requires monthly interest only payments during the first six months of the agreement followed by monthly principal and interest payments over the remaining thirty months. The Company may prepay the loan at any time prior to maturity by paying all future scheduled principal and interest payments. As of March 28, 2015, the Company’s total outstanding debt associated with the initial PFG loan was $800,000.

Interest on the $500,000 revolving line with PFG is fixed, calculated on a daily basis at a rate of 12.50% per annum. The Company may prepay the loan at any time prior to the March 13, 2017 maturity date without a penalty. Beginning in October 2014, PFG had the right to convert the $500,000 revolving loan into a term loan and require principal payments to be amortized over the remaining loan term. On April 25, 2015, PFG exercised this right, and fully amortizing principal and interest payments are scheduled to begin in May 2015. As of March 28, 2015, the $500,000 revolving line was fully advanced.

The PFG Loan is secured by all of the assets of the Company under a lien that is junior to the SVB position described in Note 14, and limits borrowing under the SVB credit line limit to $3.0 million. The Company paid a loan fee of $30,000 upon the initial draw (“First Draw”) and $15,000 for the June 2014 Amendment. The loan fees paid are recorded as prepaid expenses and amortized to interest expense over the remaining term of the PFG amended loan agreement.

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The future payments under the initial loan and all the Amendments, were as follows as of March 28, 2015.

Fiscal year (Dollars in thousands)	Principal		Interest		Total
2016	$	870		92		962
2017		430		18		448
Total	$	1,300	$	110	$	1,410

The loan agreement contains financial covenants associated with the Company achieving minimum quarterly net sales and maintaining a minimum monthly shareholders’ equity. In the event of default by the Company, all or any part of the Company’s obligation to PFG could become immediately due. As of March 28, 2015, the Company was in compliance with all the financial covenants under the agreement.

The loan agreement also provided for the issuance of warrants convertible into 300,000 shares of the Company’s common stock, of which 180,000 were exercisable upon receipt of the initial $1.0 million from the First Draw, 80,000 became exercisable with the Amendment. The Second Amendment terminated the additional 40,000 warrants that would have become exercisable as part of cancelling the remaining $500,000 that was available under the Amendment. Each warrant issued under the loan agreement has a term of five years from the First Draw and an exercise price of $1.42 which was equal to the average NASDAQ closing price of the Company’s common stock for the ten trading days prior to the First Draw.

If the warrants are not exercised before expiration on March 13, 2019, the Company would be required to pay PFG $150,000 and $67,000 as settlement for warrants associated with the First Draw and the Amendment, respectively. The warrants could be settled for cash at an earlier date in the event of any acquisition or other change in control of the Company, future public issuance of Company securities or liquidation (or substantially similar event) of the Company. The Company currently has no plans for any of the aforementioned events, and as a result, the cash payment date is estimated to be the expiration date unless warrants are exercised before then. Due to the fixed payment amount on the expiration date, the warrant structure is in substance a debt arrangement (the “Warrant Debt”) with a zero interest rate, a fixed maturity date and a feature that makes the debt convertible to common stock. The conversion feature is an embedded derivative and due to the downward adjustment feature based on performance criteria is not considered indexed solely to the Company’s stock. Thus, for accounting purposes, the conversion feature is bifurcated and accounted for separately from the host debt instrument as a derivative liability measured at fair value which resulted in an initial carrying value of $128,000 for the derivative liability associated with the warrants issued in connection with the First Draw and an initial carrying value of $123,000 for the derivative liability associated with the warrants issued in connection with the Amendment.

As of March 28, 2015, the estimated fair values of the derivative liabilities associated with the warrants issued in connection with the First Draw and Amendment were $174,000 and $78,000, respectively, for a combined value of $252,000. As of March 29, 2014, the estimated fair value of the derivative liability associated with the warrant issued in connection with the First Draw was $128,000. There was no derivative liability associated with the Amendment warrant at March 29, 2014. There was no change in the fair value of the derivative liabilities between fiscal 2015 and fiscal 2014 therefore there was no gains or losses on adjustment of derivative liability to fair value.

The proceeds from the initial $1.0 million draw were allocated between the PFG Debt and the Warrant Debt (inclusive of its conversion feature) based on their relative fair values on the date of issuance which resulted in initial carrying values of $822,000 and $178,000, respectively. The conversion feature was bifurcated from the Warrant Debt and recorded at fair value resulting in a remaining carrying value of $50,000 associated with the Warrant Debt. The resulting discounts of $178,000 on the PFG Debt and $100,000 on the Warrant Debt will be accreted to interest expense under the effective interest method over the three-year term of the PFG Debt and the five-year term of the Warrant Debt.

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The proceeds from the $500,000 credit line issued in connection with the Amendment were allocated between the PFG Loan and the Warrant Debt (inclusive of its conversion feature) based on their relative fair values on the date of issuance which resulted in initial carrying values of $365,000 and $135,000, respectively. The conversion feature was bifurcated from the Warrant Debt and recorded at its $123,000 estimated fair value resulting in a remaining carrying value of $12,000 associated with the Warrant Debt. The resulting discounts of $135,000 on the PFG Loan and $55,000 on the Warrant Debt is being accreted to interest expense under the effective interest method over the thirty-three month remaining term of the PFG Loan and the fifty-seven month remaining term of the Warrant Debt. For fiscal 2015, the Company recorded accretion of discount expense associated with the warrants issued with the PFG Loan of $152,000, there was no accretion of discount expense recorded in fiscal 2014 as the loan was funded in late fiscal 2014. 

16       Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants

On November 10, 2011, the Company received $2,199,000 in cash proceeds from Alara Capital AVI II, LLC, a Delaware limited liability company (the “Investor”), an investment vehicle sponsored by Active Value Investors, LLC, under a Securities Purchase Agreement entered into on October 31, 2011. Under the terms of the Securities Purchase Agreement, the Company issued 9,997 shares of its Series B Convertible Voting Perpetual Preferred Stock (“Series B Preferred Stock”) to the Investor at a price of $220 per share. The Company has recorded $2.0 million as Series B Preferred Stock on the consolidated balance sheet which is net of stock offering costs of approximately $202,000 and represents the value attributable to both the convertible preferred stock and warrants issued to the Investor. After considering the value of the warrants, the effective conversion price of the preferred stock was greater than the common stock price on date of issue and therefore no beneficial conversion feature was present.

On February 19, 2013, the Company entered into a Securities Purchase Agreement pursuant to which it agreed to sell 3,424.65 shares of its Series C Convertible Voting Perpetual Preferred Stock (“Series C Preferred Stock”) to the Investor, for aggregate consideration of $500,000, which is approximately $146.00 per share. The Company has recorded $457,000 as Series C Preferred Stock on the consolidated balance sheet, which is net of stock offering costs of approximately $43,000. After considering the reduction in the value of the warrant, the effective conversion price of the preferred stock was greater than the common stock price on the date of issue and therefore no beneficial conversion feature was present.

On July 8, 2013 the Company received $817,000 in net cash proceeds from the Investor under a Securities Purchase Agreement. The Company sold to the Investor 5,111.86 shares of its Series D Convertible Voting Perpetual Preferred Stock (Series D Preferred Stock) and a warrant to purchase up to 511,186 additional shares of common stock at the price of $1.43 per share. The allocation of the $858,000 in gross proceeds from issuance of Series D Preferred Stock based on the relative fair values resulted in an allocation of $498,000 (which was recorded net of $41,000 of issuance costs) to Series D Preferred Stock and $360,000 to Common Stock.  In addition, because the effective conversion rate based on the $498,000 allocated to Series D Preferred Stock was $0.97 per common share which was less than the Company’s stock price on the date of issuance, a beneficial conversion feature was present at the issuance date.  The beneficial conversion feature totaled $238,000 and was recorded as a reduction of common stock and an increase to accumulated deficit. 

Each share of Series B, Series C and Series D Preferred Stock is convertible into one hundred shares of the Company’s common stock. The investor also held warrants to purchase 1,017,405 shares at an exercise price of $1.43 per share, Warrants were exercised in part in February 2015 as discussed in Note 17, Exercise of Series C and Series D Warrants.

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The table below presents information for the periods ended March 28, 2015 and March 29, 2014:

Preferred Stock

As of March 28, 2015 and March 29, 2014

							Liquidation
	Designated Shares		Shares Issued		Shares Outstanding		Preference (in thousands)
Series B		10,000.00		9,997.00		9,997.00	$	2,309
Series C		3,500.00		3,424.65		3,424.65		500
Series D		6,000.00		5,111.86		5,111.86		731
Total		19,500.00		18,533.51		18,533.51	$	3,540

17       Exercise of Series C and Series D Warrants

On February 16, 2015, the Company entered into a Securities Purchase Agreement and Warrant Agreement with Alara Capital AVI II, LLC (“Alara Capital”), an investment vehicle sponsored by AVI Partners, LLC (“AVI” ) (with both entities collectively referred to herein as “Alara”), in which the Company received total gross cash proceeds of approximately $1.5 million. Funds were received from Alara in separate closings dated February 16, 2015 and February 23, 2015 in which Alara exercised a total of 1,002,818 of its existing Series C and Series D warrants to purchase common shares, all of which had an exercise price of $1.43 per share for total cash proceeds of $1,434,000, which was recorded net of $42,000 of stock issuance costs. As part of the consideration for this exercise, the Company sold to Alara two new warrants to purchase an additional 898,634 and 194,437 common shares at an exercise price of $1.78 and $1.76 per share, respectively, for a total purchase price of $137,000 or $0.125 per share, The new warrants have a term of five years and may be paid in cash or through a cashless net share settlement. The Company and Alara amended the remaining 14,587 warrants as part of the February closings. On May 14, 2015, Alara exercised the remaining 14,587 warrants by acquiring 7,216 of shares of the Company’s common stock through a cashless net share settlement. The Company recorded the issuance of the new Warrants using their estimated fair value on the date of issuance.  The Company estimated the fair value of the new Warrants using the Black-Scholes option valuation model with the following assumptions: expected term of 5 years, a risk-free interest rate of 1.54%, expected volatility of 90% and 0% expected dividend yield. The resulting $1.2 million from the issuance of the new Warrants was recorded as a charge to other expense in the current period.

18      Subsequent Events

On June1, 2015 the Company entered into a $2.5 million Revolving Accounts Receivable Line of Credit agreement with Bridge Bank. The credit facility agreement replaced the line of credit with SVB which expired April 15, 2015. The agreement provides for a borrowing capacity of $2.5 million with the following sub-limits:

● $500,000 on a Non-Formula basis in addition to the Borrowing Base

● $100,000 under the Borrowing Base for International Services

● $100,000 under the Borrowing Base for Cash Management Services

The loan is secured by all assets of the Company including intellectual property and general intangibles and provides for a borrowing capacity equal to 80% of eligible accounts receivable. The loan matures on May 6, 2017 and bears an interest rate 1.5% over the prime rate of interest (which was 3.25% at the date of closing resulting in an interest rate of 4.75%). Interest is payable monthly with principal due upon maturity. The Company paid a commitment fee of $12,500, and an additional $12,500 is due on the first anniversary of the loan closing. The loan agreement contains financial and non-financial covenants that are customary for this type of lending and includes a covenant to maintain an asset coverage ratio of at least 135% (defined as unrestricted cash and cash equivalents maintained with Bridge Bank N.A., plus eligible accounts receivable aged less than 90 days from the invoice date, divided by the total amount of outstanding principals of all obligations under the loan agreement). The amounts due under the facility could become immediately due in the event of default or in the event of a material adverse change in the Company’s business condition (financial or otherwise), operations, properties or prospects, or ability to repay the credit based on the judgment of lender.

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On June 3, 2015, concurrent with signing the $2.5 million Revolving Receivable Line of Credit with Bridge Bank, the Company amended its term loan agreement with PFG where PFG agreed to replace SVB with Bridge Bank as the holder of the first lien on the Company’s assets. The amended agreement also cancelled the additional $500,000 that was available to the Company under the June 2014 PFG Amendment. The Company agreed to pay PFG $150,000 principal payment towards the $500,000 outstanding revolving line of credit upon signing the amendment. The Company also agreed to pay PFG an additional $10,000 per month in principal payments until both loans are paid off, initially, the $10,000 will go against the $500,000 revolving line of credit, then against the term loan.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Shareholders

Giga-tronics Incorporated

San Ramon, California

We have audited the accompanying consolidated balance sheets of Giga-tronics Incorporated (the “Company”) as of March 28, 2015 and March 29, 2014 and the related consolidated statements of operations, shareholders’ equity and cash flows for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing 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 over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Giga-tronics Incorporated as of March 28, 2015 and March 29, 2014, and the consolidated results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles.

	/s/ Crowe Horwath LLP
San Francisco, California
June 9, 2015

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

None.

ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 as amended (the “Exchange Act”)) that are designed to ensure that information required to be disclosed in the Company’s reports under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. The Company periodically reviews the design and effectiveness of its disclosure controls and internal control over financial reporting. The Company makes modifications to improve the design and effectiveness of its disclosure controls and internal control structure, and may take other corrective action, if its reviews identify a need for such modifications or actions. The Company’s disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives.

As of the end of the period covered by this Form 10-K, an evaluation was completed under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, regarding the design and effectiveness of our disclosure controls and procedures. Based on this evaluation, our management, including our principal executive officer and principal financial officer, has concluded that our disclosure controls and procedures were effective as of March 28, 2015.

Report of Management on Internal Control over Financial Reporting

Management of Giga-tronics is responsible for establishing and maintaining adequate internal control over financial reporting for the Company, as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934. The Company's management, under the supervision of the Chief Executive Officer and Chief Financial Officer, has assessed the effectiveness of the Company's internal control over financial reporting as of March 28, 2015. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in its 1992 Internal Control-Integrated Framework. Our internal control over financial reporting includes policies and procedures designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with United States generally accepted accounting principles and that:

● pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;

● provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

● provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

Based on the above described procedures and actions taken, the Company’s management, including its Chief Executive Officer and its Chief Financial Officer have concluded that as of March 28, 2015, the Company’s internal control over financial reporting was effective based on the criteria described in the 1992 “COSO Internal Control – Integrated Framework.”

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Management’s assessment of the effectiveness of the Company’s internal control over financial reporting as of March 28, 2015, has not been audited by the Company’s independent registered public accounting firm. Management’s report is not subject to attestation by the Company’s independent registered public accounting firm pursuant to the rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this Annual Report.

Changes in Internal Control

There were no changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended March 28, 2015, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

The Company is not aware of any information required to be reported on Form 8-K that has not been previously reported.

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PART III

ITEM 10. DIRECTOR, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Information regarding Directors of the Company is set forth under the heading “Election of Directors” of the Company’s Proxy Statement for its 2015 Annual Meeting of Shareholders, incorporated herein by reference. This Proxy Statement is to be filed no later than 120 days after the close of the fiscal year ended March 28, 2015.

ITEM 11. EXECUTIVE COMPENSATION

Information regarding the Company’s compensation of its executive officers is set for the under the heading “Executive Compensation” of the Company’s Proxy Statement for its 2015 Annual Meeting of Shareholders, incorporated herein by reference. This Proxy Statement is to be filed no later than 120 days after the close of the fiscal year ended March 28, 2015.

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

Information regarding security ownership of certain beneficial owners and management is set forth under the heading “Stock Ownership of Certain Beneficial Owners and Management” of the Company’s Proxy Statement for its 2015 Annual Meeting of Shareholders, incorporated herein by reference. Information about securities authorized for issuance under equity compensation plans is set forth under the heading “Equity Compensation Plan Information” of its Proxy Statement for the 2015 Annual Meeting of Shareholders, incorporated herein by reference. This Proxy Statement is to be filed no later than 120 days after the close of the fiscal year ended March 28, 2015.

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

Information set forth in the Proxy Statement under the section captioned “Transactions with Management and Others” is incorporated herein by reference. This Proxy Statement is to be filed no later than 120 days after the close of the fiscal year ended March 28, 2015.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Information set forth in the Proxy Statement under the section captioned “Appointment of Independent Registered Accounting Firm” is incorporated herein by reference. This Proxy Statement is to be filed no later than 120 days after the close of the fiscal year ended March 28, 2015.

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PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) The following consolidated financial statements of Giga-tronics Incorporated and the related independent registered public accounting firm are filed herewith:

1.	Financial Statements. See Index to Financial Statements on page 21. The financial statements and Report of Independent Registered Public Accounting Firm are included in Item 8 are filed as part of this report.
2.	Exhibits. The exhibit list required by this item is incorporated by reference to the Exhibit Index filed with this report.

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SIGNATURES

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

GIGA-TRONICS INCORPORATED

/s/ JOHN R. REGAZZI

Chief Executive Officer 

In accordance with the requirements of the Securities Exchange Act, this annual report on Form 10-K has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

/s/ GARRETT A. GARRETTSON	Chairman of the Board	6/9/2015
Garrett A. Garrettson	of Directors	Date
/s/ JOHN R. REGAZZI	Chief Executive Officer	6/9/2015
John R. Regazzi	(Principal Executive Officer)	Date
	and Director
/s/ STEVEN D. LANCE	Vice President of Finance/	6/9/2015
Steven D. Lance	Chief Financial Officer & Secretary	Date
	(Principal Financial Officer)
/s/ GORDON L. ALMQUIST	Director	6/9/2015
Gordon L. Almquist		Date
/s/ JAMES A. COLE	Director	6/9/2015
James A. Cole		Date
/s/ KENNETH A. HARVEY	Director	6/9/2015
Kenneth A. Harvey		Date
/s/ LUTZ P. HENCKELS	Director	6/9/2015
Lutz P. Henckels		Date
/s/ WILLIAM J. THOMPSON	Director	6/9/2015
William J. Thompson		Date

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The following exhibits are filed by reference or herewith as a part of this report:

 INDEX TO EXHIBITS

3.1	Articles of Incorporation of the Company, as amended, incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 27, 1999.
3.2	Certificate of Determination of Preferences of Preferred Stock Series A of the Company, incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 27, 1999.
3.3	Certificate of Determination of Series B Convertible Voting Perpetual Preferred Stock of the Company, incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on November 14, 2011.
3.4	Certificate of Determination of Series C Convertible Voting Perpetual Preferred Stock of the Company, incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on February 25, 2013.
3.5	Certificate of Determination of Series D Convertible Voting Perpetual Preferred Stock of the Company, incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on July 3, 2013.
3.6	Amended and Restated Bylaws of the Company, incorporated by reference to Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 29, 2008..
4.1	Rights Agreement between the Company and American Stock Transfer & Trust Company, LLC dated January 23, 2013, incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on January 25, 2013.
4.2	Amendment No. 1 to Rights Agreement between the Company and American Stock Transfer & Trust Company, LLC dated June 27, 2013, incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on July 3, 2013.
4.3	Amendment No. 2 to Rights Agreement between the Company and American Stock Transfer & Trust Company, LLC dated February 16, 2015, incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on February 20, 2015.
10.1	Form of Indemnification Agreement between the Company and each of its directors and officers, incorporated by reference to Exhibit 10.1 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 27, 2010.
10.2	First Amendment to Office Lease Agreement between the Company and VIF/ZKS Norris Tech Center, LLC dated March 29, 2010 and relating to space located at 4650 Norris Canyon Road, San Ramon, CA, incorporated by reference to Exhibit 10.2 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 27, 2010.
10.3	2000 Stock Option Plan, incorporated by reference to Exhibit 99.1 to the Company’s Registration Statement on Form S-8 (File No. 33-45476) filed on September 8, 2000. *

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10.4	2005 Equity Incentive Plan, incorporated by reference to Attachment A to the Company’s Proxy Statement on Form DEF 14A filed on July 21, 2005. *
10.5	Amended and Restated Loan and Security Agreement between the Company and Partners for Growth IV, L.P. dated June 16, 2014, incorporated by reference to Exhibit 10.5 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 29, 2014.
10.6	Amended and Restated Warrant between the Company and Partners for Growth IV, L.P. dated June 16, 2014, incorporated by reference to Exhibit 10.6 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 29, 2014..
10.7	Amended and Restated Warrant between the Company and SVB Financial Group dated June 16, 2014, incorporated by reference to Exhibit 10.6 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 29, 2014.
10.8	Amended and Restated Warrant between the Company and PFG Equity Investors, LLC dated June 16, 2014, incorporated by reference to Exhibit 10.6 to the Company’s Annual Report on Form 10-K for the fiscal year ended March 29, 2014.
10.9	Securities Purchase Agreement between the Company and Alara Capital AVI II, LLC dated June 27, 2013, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on July 3, 2013.
10.10	Securities Purchase Agreement between the Company and Alara Capital AVI II, LLC dated February 16, 2015, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 20, 2015.
10.11	Warrant to Purchase 506,219 Shares of Common Stock between the Company and Alara Capital AVI II, LLC dated July 8, 2013, incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on July 12, 2013.

10.12	Warrant to Purchase 511,186 Shares of Common Stock between the Company and Alara Capital AVI II, LLC dated July 8, 2013, incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on July 12, 2013.
10.13	Warrant to Purchase 898,634 Shares of Common Stock between the Company and Alara Capital AVI II, LLC dated February 16, 2015, incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on February 20, 2015.
10.14	Warrant to Purchase 194,437 Shares of Common Stock between the Company and Alara Capital AVI II, LLC dated February 23, 2015, incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on February 27, 2015.
10.15	Amended and Restated Warrant to Purchase 14,587 Shares of Common Stock between the Company and Alara Capital AVI II, LLC dated February 23, 2015.
10.16	Investor Rights Agreement between the Company and Alara Capital AVI II, LLC dated November 10, 2011, incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on November 14, 2011.
10.17	Investor Rights Agreement between the Company and Alara Capital AVI II, LLC dated July 8, 2013, incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on July 12, 2013.

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10.18	Investor Rights Agreement between the Company and Alara Capital AVI II, LLC dated February 16, 2015, incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on February 20, 2015.
10.19	Amendment No. 1 to Securities Purchase Agreement and Investor Rights Agreement between the Company and Alara Capital AVI II, LLC dated February 23, 2015, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 27, 2015.
10.20	Severance Agreement between the Company and John R. Regazzi dated June 3, 2010, incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2010. *
10.21	Severance Agreement between the Company and Michael R. Penta dated July 16, 2012*
10.22	Severance Agreement between the Company and Steven D. Lance dated June 1, 2015*
21	Significant Subsidiaries.
23	Consent of Independent Registered Public Accounting Firm, Crowe Horwath LLP.
31.1	Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer 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 Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.1	The following materials from the Company’s Annual Report on Form 10K for the year ended March 28, 2015, formatted in XBRL (“eXtensible Business Reporting Language”): (i) the Consolidated Balances Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Cash Flows, and (iv) the Notes to the Consolidated Financial Statements, tagged as blocks of text (furnished but not filed).
*	Management contract or compensatory plan or arrangement.

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EX-10.15

Exhibit 10.15

AMENDED AND RESTATED
WARRANT TO PURCHASE COMMON STOCK

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO A REGISTRATION STATEMENT RELATING THERETO IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS.

Warrant To Purchase
14,587 Shares of Common Stock of
GIGA-TRONICS INCORPORATED

Issue Date: February 23, 2015

Explanatory Note. This is an amendment and restatement of a Warrant originally dated June 27, 2013, for the purchase of 383,200 shares of common stock of the Company, as previously amended, following the surrender of the original Warrant in connection with a partial exercise.

1.     Definitions. Unless the context otherwise requires, when used herein the following terms shall have the meanings indicated.

“Affiliate” means, with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, Controls, is controlled by or is under common control with such Person, as such terms are used in and construed under Rule 405 under the Securities Act; provided, however, that notwithstanding the foregoing, as used herein, no Purchaser shall be deemed an Affiliate of the Company or any Subsidiary, and none of the Company and its Subsidiaries shall be deemed an Affiliate of any Purchaser.

“Articles of Incorporation” means, with respect to any Person, its certificate or articles of incorporation, articles of association, or similar organizational document.

“Board” means the board of directors of the Company, including any duly authorized committee thereof.

“Business Combination” means a merger, consolidation, statutory share exchange or similar transaction that requires the approval of the Company’s shareholders.

“business day” means any day except Saturday, Sunday and any day on which banking institutions in the State of California generally are authorized or required by law or other governmental actions to close.

“Capital Stock” means (A) with respect to any Person that is a corporation or company, any and all shares, interests, participations or other equivalents (however designated) of capital or capital stock of such Person and (B) with respect to any Person that is not a corporation or company, any and all partnership or other equity interests of such Person.

“Common Stock” means the Company’s common stock, no par value.

“Company” means Giga-tronics Incorporated, a California corporation.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations promulgated thereunder.

“Exercise Price” means $1.43 per share, subject to adjustment as provided herein.

“Expiration Time” means 5:00 p.m., Pacific time on January 8, 2016.

“Fair Market Value” means, with respect to any security or other property, the fair market value of such security or other property as determined by the Board, acting in good faith.

“Holder” has the meaning set forth in Section 2.

“Issue Date” means the date identified as the issue date on the first page of this Warrant.

“Market Price” means, with respect to a particular security, on any given day, the last reported sale price regular way or, in case no such reported sale takes place on such day, the average of the last closing bid and ask prices regular way, in either case on the principal national securities exchange on which the applicable securities are listed or admitted to trading, or if not listed or admitted to trading on any national securities exchange, the last quoted bid price for the Common Stock in the over-the-counter market as reported by Pink Sheets LLC or similar organization. “Market Price” shall be determined without reference to after hours or extended hours trading. If such security is not listed and traded in a manner that the quotations referred to above are available for the period required hereunder, the Market Price per share of Common Stock shall be deemed to be the Fair Market Value per share of such security. For the purposes of determining the Market Price of the Common Stock on the "trading day" preceding, on or following the occurrence of an event, (i) that trading day shall be deemed to commence immediately after the regular scheduled closing time of trading on the Nasdaq Stock Market or, if trading is closed at an earlier time, such earlier time and (ii) that trading day shall end at the next regular scheduled closing time, or if trading is closed at an earlier time, such earlier time (for the avoidance of doubt, and as an example, if the Market Price is to be determined as of the last trading day preceding a specified event and the closing time of trading on a particular day is 4:00 p.m. and the specified event occurs at 5:00 p.m. on that day, the Market Price would be determined by reference to such 4:00 p.m. closing price).

“Person” has the meaning given to it in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.

“Pro Rata Repurchases” means any purchase of shares of Common Stock by the Company or any Affiliate thereof pursuant to (A) any tender offer or exchange offer subject to Section 12(e) or 14(e) of the Exchange Act or Regulation 14E promulgated thereunder or (B) any other offer available to substantially all holders of Common Stock, in the case of both (A) or (B), whether for cash, shares of Capital Stock of the Company, other securities of the Company, evidences of indebtedness of the Company or any other Person or any other property (including, without limitation, shares of Capital Stock, other securities or evidences of indebtedness of a subsidiary), or any combination thereof, effected while this Warrant is outstanding. The “Effective Date” of a Pro Rata Repurchase shall mean the date of acceptance of shares for purchase or exchange by the Company under any tender or exchange offer which is a Pro Rata Repurchase or the date of purchase with respect to any Pro Rata Repurchase that is not a tender or exchange offer.

“Securities Act” means the Securities Act of 1933, as amended, or any successor statute, and the rules and regulations promulgated thereunder.

“Securities Purchase Agreement” means that Securities Purchase Agreement dated as of June __, 2013, by and among the Company and the Holder.

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“Shares” means the shares of the Company’s Common Stock that may be acquired under this Warrant.

“trading day” means (A) if the shares of Common Stock are not traded on any national or regional securities exchange or association or over-the-counter market, a business day or (B) if the shares of Common Stock are traded on any national or regional securities exchange or association or over-the-counter market, a business day on which such relevant exchange or quotation system is scheduled to be open for business and on which the shares of Common Stock (i) are not suspended from trading on any national or regional securities exchange or association or over-the-counter market for any period or periods aggregating one half hour or longer; and (ii) have traded at least once on the national or regional securities exchange or association or over-the-counter market that is the primary market for the trading of the shares of Common Stock.

“Warrant” means this amended and restated warrant, which has been modified as of the date hereof in accordance with the Explanatory Note included on the first page of this Warrant.

2.     Number of Shares; Exercise Price. This certifies that, for value received, Alara Capital AVI II, LLC, a Delaware limited liability company, or its permitted assigns (the “Holder”) is entitled, upon the terms and subject to the conditions hereinafter set forth, to acquire from the Company, in whole or in part, up to an aggregate of 14,587 shares of Common Stock, at a purchase price per share of Common Stock equal to the Exercise Price. The number of Shares and the Exercise Price are subject to adjustment as provided herein, and all references to “Common Stock,” “Shares” and “Exercise Price” herein shall be deemed to include any such adjustment or series of adjustments.

3.     Exercise of Warrant; Term.

(A)     Subject to Section 2, the right to purchase the Shares represented by this Warrant is exercisable, in whole or in part by the Holder, at any time or from time to time, but in no event later than the Expiration Time, by (A) the surrender of this Warrant and Notice of Exercise annexed hereto, duly completed and executed on behalf of the Holder, at the principal executive office of the Company located at the address set forth in Section 19(a) hereto (or such other office or agency of the Company in the United States as it may designate by notice in writing to the Holder at the address of the Holder appearing on the books of the Company), and (B) payment of the Exercise Price for the Shares thereby purchased by tendering in cash or by wire transfer of immediately available funds to an account designated by the Company. If the Holder does not exercise this Warrant in its entirety, the Holder will be entitled to receive from the Company within a reasonable time, and in any event not exceeding three business days, a new warrant in substantially identical form for the purchase of that number of Shares equal to the difference between the number of Shares subject to this Warrant and the number of Shares as to which this Warrant is so exercised.

(B)     If at any time until the Expiration Time, there is no effective registration statement under the Securities Act of 1933, as amended, or no current prospectus covering the resale of the Shares, then, this Warrant may be exercised at such time by means of a “cashless exercise,” whereupon the surrender of this Warrant and Notice of Exercise annexed hereto, duly completed and executed on behalf of the Holder, at the principal executive office of the Company located at the address set forth in Section 19(a) hereto (or such other office or agency of the Company in the United States as it may designate by notice in writing to the Holder at the address of the Holder appearing on the books of the Company), the Company will issue the number of Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

(A) = Market Price of the Common Stock on the last trading day preceding the date of exercise;

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(B) = the Exercise Price; and

(X) = the number of Shares for which this Warrant is being exercised.

(C)     To the extent permitted by applicable laws and regulations, the Company’s obligations to issue and deliver Shares in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any person or entity or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other person or entity of any obligation to the Company or any violation or alleged violation of law by the Holder or any other person or entity, and irrespective of any other circumstance which might otherwise limit such obligation of the Company to the Holder in connection with the issuance of Shares. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing Shares upon exercise of this Warrant as required pursuant to the terms hereof.

4.      Issuance of Shares; Authorization. Certificates for Shares issued upon exercise of this Warrant will be issued in the name of Holder or and will be delivered to Holder or such named Person or Persons within a reasonable time after the date on which this Warrant has been duly exercised in accordance with the terms of this Warrant. The Company hereby represents and warrants that any Shares issued upon the exercise of this Warrant in accordance with the provisions of Section 3 will be duly and validly authorized and issued, fully paid and nonassessable and free from all taxes, liens and charges (other than liens or charges created by the Holder, income and franchise taxes incurred in connection with the exercise of the Warrant or taxes in respect of any transfer occurring contemporaneously therewith). The Company agrees that the Shares so issued will be deemed to have been issued to the Holder as of the close of business on the date on which this Warrant and payment of the Exercise Price are delivered to the Company in accordance with the terms of this Warrant, notwithstanding that the stock transfer books of the Company may then be closed or certificates representing such Shares may not be actually delivered on such date. The Company will at all times reserve and keep available, out of its authorized but unissued Common Stock, solely for the purpose of providing for the exercise of this Warrant, the aggregate number of shares of Common Stock then issuable upon exercise of this Warrant at any time. The Company will use reasonable best efforts to ensure that the Shares may be issued without violation of any applicable law or regulation or of any requirement of any securities exchange on which the Shares are listed or traded, if any. Upon agreement of the Company and Holder, in lieu of issuing certificates evidencing Shares, the Company shall cause its transfer agent to issue such Shares in book-entry form.

5.      No Fractional Shares or Scrip. No fractional Shares or scrip representing fractional Shares shall be issued upon any exercise of this Warrant. In lieu of any fractional Share to which the Holder would otherwise be entitled, the Holder shall be entitled to receive a cash payment equal to the Market Price of the Common Stock on the last trading day preceding the date of exercise less the pro-rated Exercise Price for such fractional share.

6.      No Rights as Shareholder. This Warrant does not entitle the Holder to any voting rights or other rights as a shareholder of the Company prior to the date of exercise hereof.

7.      Charges, Taxes and Expenses. Issuance of certificates for Shares to the Holder upon the exercise of this Warrant shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such certificates, all of which taxes and expenses shall be paid by the Company.

8.      Transfer/Assignment. This Warrant and all rights hereunder are transferable, in whole or in part, upon the books of the Company by the registered holder hereof in person or by duly authorized attorney to any Affiliate of such registered holder, and a new warrant shall be made and delivered by the Company, of the same tenor and date as this Warrant but registered in the name of one or more transferees, upon surrender of this Warrant, duly endorsed, to the office or agency of the Company described in Section 3. All expenses (other than stock transfer taxes) and other charges payable in connection with the preparation, execution and delivery of the new warrants pursuant to this Section 8 shall be paid by the Company.

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9.      Exchange and Registry of Warrant. This Warrant is exchangeable, upon the surrender hereof by the Holder to the Company, for a new warrant or warrants of like tenor and representing the right to purchase the same aggregate number of Shares. The Company shall maintain a registry showing the name and address of the Holder as the registered holder of this Warrant. This Warrant may be surrendered for exchange or exercise in accordance with its terms, at the office of the Company, and the Company shall be entitled to rely in all respects, prior to written notice to the contrary, upon such registry.

10.      Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant, and in the case of any such loss, theft or destruction, upon receipt of a bond, indemnity or security reasonably satisfactory to the Company, or, in the case of any such mutilation, upon surrender and cancellation of this Warrant, the Company shall make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the right to purchase the same aggregate number of Shares as provided for in such lost, stolen, destroyed or mutilated Warrant.

11.      Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a business day, then such action may be taken or such right may be exercised on the next succeeding day that is a business day.

12.      Adjustments and Other Rights. The Exercise Price and the number of Shares issuable upon exercise of this Warrant shall be subject to adjustment from time to time as follows; provided, that if more than one subsection of this Section 12 is applicable to a single event, the subsection shall be applied that produces the largest adjustment and no single event shall cause an adjustment under more than one subsection of this Section 12 so as to result in duplication:

(A)     Stock Splits, Subdivisions, Reclassifications or Combinations. If the Company shall (i) declare and pay a dividend or make a distribution on its Common Stock in shares of Common Stock, (ii) subdivide or reclassify the outstanding shares of Common Stock into a greater number of shares, or (iii) combine or reclassify the outstanding shares of Common Stock into a smaller number of shares, then, in each such case, the number of Shares issuable upon exercise of this Warrant at the time of the record date for such dividend or distribution or the effective date of such subdivision, combination or reclassification shall be proportionately adjusted so that the Holder after such date shall be entitled to purchase the number of shares of Common Stock which such Holder would have owned or been entitled to receive in respect of the shares of Common Stock subject to this Warrant after such date had this Warrant been exercised immediately prior to such date. In such event, the Exercise Price in effect at the time of the record date for such dividend or distribution or the effective date of such subdivision, combination or reclassification shall be adjusted to the number obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of this Warrant before such adjustment and (2) the Exercise Price in effect immediately prior to the record or effective date, as the case may be, for the dividend, distribution, subdivision, combination or reclassification giving rise to this adjustment by (y) the new number of Shares issuable upon exercise of the Warrant determined pursuant to the immediately preceding sentence.

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(B)      Certain Repurchases of Common Stock. If the Company effects a Pro Rata Repurchase of Common Stock, then, in each such case, the Exercise Price shall be reduced to the price determined by multiplying the Exercise Price in effect immediately prior to the Effective Date of such Pro Rata Repurchase by a fraction of which the numerator shall be (i) the product of (x) the number of shares of Common Stock outstanding immediately before such Pro Rata Repurchase and (y) the Market Price of a share of Common Stock on the trading day immediately preceding the first public announcement by the Company or any of its Affiliates of the intent to effect such Pro Rata Repurchase, minus (ii) the aggregate purchase price of the Pro Rata Repurchase, and of which the denominator shall be the product of (i) the number of shares of Common Stock outstanding immediately prior to such Pro Rata Repurchase minus the number of shares of Common Stock so repurchased and (ii) the Market Price per share of Common Stock on the trading day immediately preceding the first public announcement by the Company or any of its Affiliates of the intent to effect such Pro Rata Repurchase. In such event, the number of shares of Common Stock issuable upon the exercise of this Warrant shall be increased to the number obtained by dividing (x) the product of (1) the number of Shares issuable upon the exercise of this Warrant before such adjustment, and (2) the Exercise Price in effect immediately prior to the Pro Rata Repurchase giving rise to this adjustment by (y) the new Exercise Price determined in accordance with the immediately preceding sentence. Notwithstanding anything in this Section 12(B) to the contrary, in no event shall any adjustment be made pursuant to this Section 12(B) which would result in an increase to the Exercise Price or a decrease in the number of Shares issuable upon exercise of this Warrant.

(C)     Business Combinations. In the event of any Business Combination or reclassification of Common Stock (other than a reclassification of Common Stock referred to in Section 12(A)), then, in each such case, the Holder’s right to receive Shares upon exercise of this Warrant shall be converted into the right to receive upon exercise of this Warrant the number of shares of stock or other securities or property (including cash) which the Common Stock issuable (at the time of such Business Combination or reclassification) upon exercise of this Warrant immediately prior to such Business Combination or reclassification would have been entitled to receive upon consummation of such Business Combination or reclassification; and in each such case, if necessary, the provisions set forth herein with respect to the rights and interests thereafter of the Holder shall be appropriately adjusted so as to be applicable, as nearly as may reasonably be, to the Holder’s right to exercise this Warrant in exchange for any shares of stock or other securities or property pursuant to this paragraph. In determining the kind and amount of stock, securities or the property receivable upon exercise of this Warrant following the consummation of such Business Combination, if the holders of Common Stock have the right to elect the kind or amount of consideration receivable upon consummation of such Business Combination, then the consideration that the Holder shall be entitled to receive upon exercise shall be deemed to be the types and amounts of consideration received by the majority of all holders of the shares of Common Stock that affirmatively make an election (or of all such holders if none make an election).

(D)     Rounding of Calculations; Minimum Adjustments. All calculations under this Section 12 shall be made to the nearest one-tenth (1/10th) of a cent or to the nearest one-hundredth (1/100th) of a share, as the case may be. Any provision of this Section 12 to the contrary notwithstanding, no adjustment in the Exercise Price or the number of Shares into which this Warrant is exercisable shall be made if the amount of such adjustment would be less than $0.01 or one-tenth (1/10th) of a share of Common Stock, but any such amount shall be carried forward and an adjustment with respect thereto shall be made at the time of and together with any subsequent adjustment which, together with such amount and any other amount or amounts so carried forward, shall aggregate $0.01 or 1/10th of a share of Common Stock, or more.

(E)     Timing of Issuance of Additional Common Stock Upon Certain Adjustments. In any case in which the provisions of this Section 12 shall require that an adjustment shall become effective immediately after a record date for an event, the Company may defer until the occurrence of such event (i) issuing to the Holder of this Warrant exercised after such record date and before the occurrence of such event the additional shares of Common Stock issuable upon such exercise by reason of the adjustment required by such event over and above the shares of Common Stock issuable upon such exercise before giving effect to such adjustment and (ii) paying to such Holder any amount of cash in lieu of a fractional share of Common Stock; provided, however, that the Company upon request shall deliver to such Holder a due bill or other appropriate instrument evidencing such Holder’s right to receive such additional shares, and such cash, upon the occurrence of the event requiring such adjustment.

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(F)      Other Events. For so long as the Holder holds this Warrant or any portion thereof, if any event occurs as to which the provisions of this Section 12 are not strictly applicable or, if strictly applicable, would not, in the good faith judgment of the Board, fairly and adequately protect the purchase rights of the Warrants in accordance with the essential intent and principles of such provisions, then the Board shall make such adjustments in the application of such provisions, in accordance with such essential intent and principles, as shall be reasonably necessary, in the good faith opinion of the Board, to protect such purchase rights as aforesaid. The Exercise Price or the number of Shares into which this Warrant is exercisable shall not be adjusted in the event of a change in the par value of the Common Stock or a change in the jurisdiction of incorporation of the Company.

(G)     Statement Regarding Adjustments. Whenever the Exercise Price or the number of Shares into which this Warrant is exercisable shall be adjusted as provided in Section 12, the Company shall forthwith file at the principal office of the Company a statement showing in reasonable detail the facts requiring such adjustment and the Exercise Price that shall be in effect and the number of Shares into which this Warrant shall be exercisable after such adjustment, and the Company shall also cause a copy of such statement to be sent by mail, first class postage prepaid, to each Holder at the address appearing in the Company’s records.

(H)      Notice of Adjustment Event. In the event that the Company shall propose to take any action of the type described in this Section 12 (but only if the action of the type described in this Section 12 would result in an adjustment in the Exercise Price or the number of Shares into which this Warrant is exercisable or a change in the type of securities or property to be delivered upon exercise of this Warrant), the Company shall give notice to the Holder, in the manner set forth in Section 12(G), which notice shall specify the record date, if any, with respect to any such action and the approximate date on which such action is to take place. Such notice shall also set forth the facts with respect thereto as shall be reasonably necessary to indicate the effect on the Exercise Price and the number, kind or class of shares or other securities or property which shall be deliverable upon exercise of this Warrant. In the case of any action which would require the fixing of a record date, such notice shall be given at least 10 days prior to the date so fixed, and in case of all other action, such notice shall be given at least 15 days prior to the taking of such proposed action. Failure to give such notice, or any defect therein, shall not affect the legality or validity of any such action.

(I)     Proceedings Prior to Any Action Requiring Adjustment. As a condition precedent to the taking of any action which would require an adjustment pursuant to this Section 12, the Company shall take any action which may be necessary, including obtaining regulatory and other applicable national securities exchange or shareholder approvals or exemptions, in order that the Company may thereafter validly and legally issue as fully paid and nonassessable all shares of Common Stock that the Holder is entitled to receive upon exercise of this Warrant pursuant to this Section 12.

(J)     Adjustment Rules. Any adjustments pursuant to this Section 12 shall be made successively whenever an event referred to herein shall occur.

13.      No Impairment. The Company will not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Warrant and in taking of all such action as may be necessary or appropriate in order to protect the rights of the Holder.

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14.      Governing Law. This Warrant will be governed by and construed in accordance with the law of the State of California applicable to contracts made and to be performed entirely within such State. Each of the Company and the Holder agrees (a) to submit to the exclusive jurisdiction and venue of the state and federal courts in the State of California for any civil action, suit or proceeding arising out of or relating to this Warrant or the transactions contemplated hereby, and (b) that notice may be served upon the Company at the address in Section 18 below and upon the Holder at the address for the Holder set forth in the registry maintained by the Company pursuant to Section 9 hereof. To the extent permitted by applicable law, each of the Company and the Holder hereby unconditionally waives trial by jury in any civil legal action or proceeding relating to the Warrant or the transactions contemplated hereby or thereby.

15.      Binding Effect. This Warrant shall be binding upon any successors or assigns of the Company.

16.      Amendments. This Warrant may be amended and the observance of any term of this Warrant may be waived only with the written consent of the Company and the Holder.

17.      Prohibited Actions. The Company agrees that it will not take any action which would entitle the Holder to an adjustment of the Exercise Price if the total number of shares of Common Stock issuable after such action upon exercise of this Warrant, together with all shares of Common Stock then outstanding and all shares of Common Stock then issuable upon the exercise of all outstanding options, warrants, conversion and other rights, would exceed the total number of shares of Common Stock then authorized by its Articles of Incorporation.

18.      Notices. All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, (or on the first business day after transmission by facsimile) be, in writing by the Company or such Holder from time to time as follows:

(a)  if to the Company, at:

Giga-tronics Incorporated
4650 Norris Canyon Road
San Ramon, California 94583
Attn: John Regazzi, President and Chief Executive Officer

(b)  if to Holder, at the addressed indicated below Holder’s signature.

or to such other representative or at such other address of a party as such party hereto may furnish to the other parties in writing in accordance with this Section 10.

19.      Entire Agreement. This Warrant and the form attached hereto and the Securities Purchase Agreement contain the entire agreement between the parties with respect to the subject matter hereof and supersede all prior and contemporaneous arrangements or undertakings with respect thereto.

[Remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by a duly authorized officer as of the Issue Date set forth above.

“COMPANY”

GIGA-TRONICS INCORPORATED

By:         /s/ John Regazzi                                                                 

Name:    John Regazzi

Title:      President and Chief Executive Officer

“HOLDER”

ALARA CAPITAL AVI II, LLC, a Delaware limited liability company

By: /s/ Darren C. Wallis                                                  

Name:  Darren C. Wallis

Title:    Managing Member

Address for Notice:

c/o AVI Partners, LLC

555 E. Lancaster Avenue

Suite 520

Radnor, PA 19087

Telephone No.: (610) 860-6660
E-mail Address: dwallis@avipartners.com

Attention: Darren C. Wallis, Managing Member

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[Form of Notice of Exercise]

Date: _________

TO: Giga-tronics Incorporated 

RE: Election to Purchase Common Stock

The undersigned, pursuant to the provisions set forth in the attached Warrant, hereby agrees to subscribe for and purchase the number of shares of the Common Stock set forth below covered by such Warrant. The undersigned, in accordance with Section 3 of the Warrant, hereby agrees to pay the aggregate Exercise Price for such shares of Common Stock in the manner set forth below. A new warrant evidencing the remaining shares of Common Stock covered by such Warrant, but not yet subscribed for and purchased, if any, should be issued in the name set forth below.

Number of Shares of Common Stock                                                                      

Method of Payment of Exercise Price:                                                                   

Aggregate Exercise Price:                                                            

Holder:                                                                    

By:                                                                           

Name:                                                                      

Title:                                                                        

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EX-10.21

EXHIBIT 10.21

GIGA-TRONICS INCORPORATED

SEVERANCE AGREEMENT

This Severance Agreement (the “Agreement”) is made and entered into by and between Michael R. Penta (“Employee”) and Giga-tronics Incorporated, a California Corporation (the “Company”), effective as of July 16, 2012 (the “Effective Date”).

RECITALS

1.     It is expected that the Company from time to time will consider the possibility of an acquisition by another company or other change of control. The Board of Directors of the Company (the “Board”) recognizes that such consideration can be a distraction to Employee and can cause Employee to consider alternative employment opportunities. The Board has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication and objectivity of Employee, notwithstanding the possibility, threat or occurrence of a Change of Control.

2.     The Board believes that it is in the best interests of the Company and its stockholders to provide Employee with an incentive to continue his or her employment and to motivate Employee to maximize the value of the Company for the benefit of its stockholders.

3.     The Board believes that it is imperative to provide Employee with certain benefits upon Employee’s termination of employment without cause or following a Change of Control. These benefits will provide Employee with enhanced financial security and incentive and encouragement to remain with the Company.

4.     Certain capitalized terms used in the Agreement are defined in Section 5 below.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto agree as follows:

1.     Term of Agreement. This Agreement will terminate upon the date that all of the obligations of the parties hereto with respect to this Agreement have been satisfied.

2.     At-Will Employment. The Company and Employee acknowledge that Employee’s employment is and will continue to be at-will, as defined under applicable law, except as may otherwise be specifically provided under the terms of any written formal employment agreement or offer letter between the Company and Employee (an “Employment Agreement”). If Employee’s employment terminates for any reason, Employee will not be entitled to any payments, benefits, damages, awards or compensation other than as provided by this Agreement, including any payments or benefits Employee would otherwise be entitled to under his or her Employment Agreement.

3.     Termination Benefits.

(a)     Involuntary Termination other than for Cause, Death or Disability Prior to a Change of Control or after Twelve Months Following a Change of Control. If, prior to a Change of Control or after twelve (12) months following a Change of Control, the Company (or any parent or subsidiary of the Company employing Employee) terminates Employee’s employment with the Company (or any parent or subsidiary of the Company) without Employee’s consent and for a reason other than (x) Cause, (y) Employee becoming Disabled or (z) Employee’s death, (any such termination, an “Involuntary Termination”) and Employee signs, delivers and does not revoke a separation agreement and release of claims in a form satisfactory to the Company (the “Release”) within the time period required by the Release (but in no event later than two and one-half (2½) months following the end of the calendar year in which the Involuntary Termination occurs), then following such termination of employment, or, if later, the effective date of the Release, Employee will receive the following payments and other benefits from the Company:

(i)     Accrued Compensation. Employee will be entitled to receive all accrued vacation, expense reimbursements and any other benefits due to Employee through the date of termination of employment in accordance with the Company’s then existing employee benefit plans, policies and arrangements.

(ii)     Severance. Subject to Section 9(a), Employee will be entitled to receive continued payments of Employee’s trailing 12 month salary (as in effect immediately prior to such termination) for a period of nine (9) months (the “Severance Period”), less applicable withholding payable in accordance with the Company’s normal payroll policies. Notwithstanding the foregoing and except as provided by the following sentence, if during the Severance Period Employee engages in Competition or breaches the covenants in Section 6 or in the Release, all payments pursuant to this subsection will immediately cease effective as of the first date that constitutes engagement in Competition or a breach of the applicable covenants (the “Breach Date”). Notwithstanding the preceding sentence, if payment of the severance amounts is delayed in accordance with Section 9(a) of this Agreement, the Company’s obligation to make severance payments to Executive during the Severance Period shall not terminate pursuant to the preceding sentence (i.e., upon the Breach Date) with respect to any severance payments that have been accrued prior to the Breach Date in accordance with Section 9(a) of this Agreement and such accrued severance payments shall be paid in a lump sum payment on the date six (6) months and one (1) day following the date of Executive’s termination of employment (or such earlier date as provided in Section 9(a) of this Agreement).

(iii)     Continued Employee Benefits. The Company will reimburse Employee for premiums paid for the continuation of benefits Employee timely elects pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”)for Employee and Employee’s eligible dependents under the Company’s Benefit Plans for a period of nine (9) months following Employee’s termination of employment; provided, however, that if during such period Employee engages in Competition or breaches the covenants in Section 6 or in the Release, all Company-reimbursements pursuant to this subsection will immediately cease. Employee will be solely responsible for electing such continuation coverage for Employee and Employee’s eligible dependents.

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(iv)     Options. With respect to all of Employee’s options (the “Options”) to purchase Company common stock outstanding on the date of such termination (whether granted on, before or after the date of this Agreement), Employee will have the period following such termination of employment to exercise such Options that is specified in the stock plans, if any, under which the Options were granted and in any applicable agreements between the Company and Employee; provided, however, to the extent that, pursuant to the provisions of such stock plans and applicable agreements, such Options continue to vest during the period, if any, that Employee provides consulting services to the Company pursuant to Section 3(a)(ii) or otherwise, then Employee will have the period following the termination of such consulting services to exercise such Options that is specified in such stock plans and applicable agreements; provided further, however, that all Options will immediately terminate and Employee will have no further rights with respect to such Options in the event Employee engages in Competition or breaches the covenants in Section 6 or in the Release during such period. In all other respects, such Options will continue to be subject to the terms and conditions of the stock plans, if any, under which they were granted and any applicable agreements between the Company and Employee.

(v)     Payments or Benefits Required by Law. Employee will receive such other compensation or benefits from the Company as may be required by law (for example, “COBRA” coverage under Section 4980B of the Internal Revenue Code of 1986, as amended (the “Code”)).

(b)     Involuntary Termination other than for Cause, Death or Disability or Termination for Good Reason within Twelve Months of a Change of Control. If (i) within twelve (12) months following a Change of Control (A) Employee terminates his or her employment with the Company (or any parent or subsidiary of the Company) for Good Reason or (B) the Company (or any parent or subsidiary of the Company) terminates Employee’s employment for other than (x) Cause, (y) Employee becoming Disabled or (z) Employee’s death (any such termination pursuant to (A) or (B), a “Change of Control Termination”) and (ii) Employee signs, delivers and does not revoke a Release within the time period required by the Release (but in no event later than two and one-half (2½) months following the end of the calendar year in which the Involuntary Termination occurs), then promptly following such termination of employment, or, if later, the effective date of the Release, Employee will receive the following payments and other benefits from the Company:

(i)     Accrued Compensation. Employee will be entitled to receive all accrued vacation, expense reimbursements and any other benefits due to Employee through the date of termination of employment in accordance with the Company’s then existing employee benefit plans, policies and arrangements.

(ii)     Severance. Subject to Section 9(a), Employee will be entitled to receive continued payments of Employee’s trailing 12 month salary (as in effect immediately prior to such termination) for a period of twelve (12) months (the “Post-Change of Control Severance Period”), less applicable withholding, payable in accordance with the Company’s normal payroll policies. Notwithstanding the foregoing and except as provided by the following sentence, if during the Post-Change of Control Severance Period Employee engages in Competition or breaches the covenants in Section 6 or in the Release, all payments pursuant to this subsection will immediately cease effective as of the Breach Date. Notwithstanding the preceding sentence, if payment of the severance amounts is delayed in accordance with Section 9(a) of this Agreement, the Company’s obligation to make severance payments to Executive during the Post-Change of Control Severance Period shall not terminate pursuant to the preceding sentence (i.e., upon the Breach Date) with respect to any severance payments that have been accrued prior to the Breach Date in accordance with Section 9(a) of this Agreement and such accrued severance payments shall be paid in a lump sum payment on the date six (6) months and one (1) day following the date of Executive’s termination of employment (or such earlier date as provided in Section 9(a) of this Agreement).

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(iii)     Options, Restricted Stock and Restricted Stock Units. 100% of the unvested shares subject to all of Employee’s Options, 100% of the unvested shares subject to all of Employee’s restricted stock units (“RSUs”) and 100% any of Employee’s shares of Company common stock subject to restrictions (the “Restricted Stock”) whether acquired by Employee on, before or after the date of this Agreement, will immediately vest upon such termination. With respect to all of Employee’s Options outstanding on the date of such termination (whether granted on, before or after the date of this Agreement), Employee will have the period following such termination of employment to exercise such Options that is specified in the stock plans, if any, under which the Options were granted and in any applicable agreements between the Company and Employee; provided, however, that all Options will immediately terminate and Employee will have no further rights with respect to such Options in the event Employee engages in Competition or breaches the covenants in Section 6 or in the Release during such period. In all other respects, such Options will continue to be subject to the terms and conditions of the stock plans, if any, under which they were granted and any applicable agreements between the Company and Employee.

(iv)     Continued Employee Benefits. The Company will reimburse Employee for premiums paid for the continuation of benefits Employee timely elects pursuant to the COBRAfor Employee and Employee’s eligible dependents under the Company’s Benefit Plans for a period of twelve (12) months following Employee’s termination of employment; provided, however, that if during such period Employee engages in Competition or breaches the covenants in Section 6 or in the Release, all Company-reimbursements pursuant to this subsection will immediately cease. Employee will be solely responsible for electing such continuation coverage for Employee and Employee’s eligible dependents.

(v)     Payments or Benefits Required by Law. Employee will receive such other compensation or benefits from the Company as may be required by law (for example, “COBRA” coverage under Section 4980B of the Code).

(c)     Other Terminations. If Employee voluntarily terminates Employee’s employment with the Company or any parent or subsidiary of the Company (other than for Good Reason within twelve (12) months of a Change of Control) or if the Company (or any parent or subsidiary of the Company employing Employee) terminates Employee employment with the Company (or any parent or subsidiary of the Company) for Cause, then Employee will (i) receive his or her earned but unpaid base salary through the date of termination of employment, (ii) receive all accrued vacation, expense reimbursements and any other benefits due to Employee through the date of termination of employment in accordance with established Company plans, policies and arrangements, and (iii) not be entitled to any other compensation or benefits (including, without limitation, accelerated vesting of Options or Restricted Stock) from the Company except to the extent provided under the applicable stock option agreement(s) or as may be required by law (for example, “COBRA” coverage under Section 4980B of the Code).

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(d)     Termination due to Death or Disability. If Employee’s employment with the Company (or any parent or subsidiary of the Company) is terminated due to Employee’s death or Employee’s becoming Disabled, then Employee or Employee’s estate (as the case may be) will (i) receive the earned but unpaid base salary through the date of termination of employment, (ii) receive all accrued vacation, expense reimbursements and any other benefits due to Employee through the date of termination of employment in accordance with Company-provided or paid plans, policies and arrangements, and (iii) not be entitled to any other compensation or benefits from the Company except to the extent required by law (for example, “COBRA” coverage under Section 4980B of the Code).

(e)     Exclusive Remedy. In the event of a termination of Employee’s employment with the Company (or any parent or subsidiary of the Company), the provisions of this Section 3 are intended to be and are exclusive and in lieu of any other rights or remedies to which Employee or the Company may otherwise be entitled (including any contrary provisions in the Employment Agreement), whether at law, tort or contract, in equity, or under this Agreement. Employee will be entitled to no benefits, compensation or other payments or rights upon termination of employment other than those benefits expressly set forth in this Section 3.

4.     Limitation on Payments. In the event that the severance and other benefits provided for in this Agreement or otherwise payable to Employee (i) constitute “parachute payments” within the meaning of Section 280G of the Code and (ii) but for this Section 4, would be subject to the excise tax imposed by Section 4999 of the Code, then Employee’s severance benefits under Section 4(a)(i) will be either:

(a)     delivered in full, or

(b)     delivered as to such lesser extent which would result in no portion of such severance benefits being subject to excise tax under Section 4999 of the Code,

whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the excise tax imposed by Section 4999, results in the receipt by Employee on an after-tax basis, of the greatest amount of severance benefits, notwithstanding that all or some portion of such severance benefits may be taxable under Section 4999 of the Code. Unless the Company and Employee otherwise agree in writing, any determination required under this Section 4 will be made in writing by BDO Seidman or by a national “Big Four” accounting firm (the “Accountants”), whose determination will be conclusive and binding upon Employee and the Company for all purposes. For purposes of making the calculations required by this Section 4, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code. The Company and Employee will furnish to the Accountants such information and documents as the Accountants may reasonably request in order to make a determination under this Section. The Company will bear all costs the Accountants may reasonably incur in connection with any calculations contemplated by this Section 4.

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5.     Definition of Terms. The following terms referred to in this Agreement will have the following meanings:

(a)     Benefit Plans. “Benefit Plans” means plans, policies or arrangements that the Company sponsors (or participates in) and that immediately prior to Employee’s termination of employment provide Employee and/or Employee’s eligible dependents with medical, dental, and/or vision benefits. Benefit Plans do not include any other type of benefit (including, but not by way of limitation, disability, life insurance or retirement benefits). A requirement that the Company provide Employee and Employee’s eligible dependents with coverage under the Benefit Plans will not be satisfied unless the coverage is no less favorable than that provided to Employee and Employee’s eligible dependents immediately prior to Employee’s termination of employment.

(b)     Cause. “Cause” means (i) a willful failure by Employee to substantially perform Employee’s duties as an employee, other than a failure resulting from the Employee’s complete or partial incapacity due to physical or mental illness or impairment, (ii) a willful act by Employee that constitutes gross misconduct and that is injurious to the Company, (iii) circumstances where Employee willfully imparts material confidential information relating to the Company or its business to competitors or to other third parties other than in the course of carrying out Employee’s duties, (iv) a material and willful violation by Employee of a federal or state law or regulation applicable to the business of the Company that is injurious to the Company, or (v) Employee’s conviction or plea of guilty or no contest to a felony, which the Company reasonably believes has or will negatively reflect on the Company’s business or reputation. No act or failure to act by Employee will be considered “willful” unless committed without good faith and without a reasonable belief that the act or omission was in the Company’s best interest.

(c)     Change of Control. “Change of Control” means the occurrence of any of the following:

(i)     the sale, lease, conveyance or other disposition of all or substantially all of the Company’s assets to any “person” (as such term is used in Section 13(d) of the Securities Exchange Act of 1934, as amended), entity or group of persons acting in concert;

(ii)     any person or group of persons becoming the “beneficial owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the Company’s then outstanding voting securities;

(iii)     a merger or consolidation of the Company with any other corporation, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its controlling entity) at least 50% of the total voting power represented by the voting securities of the Company or such surviving entity (or its controlling entity) outstanding immediately after such merger or consolidation; or

(iv)     a contest for the election or removal of members of the Board that results in the removal from the Board of at least 50% of the incumbent members of the Board.

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(d)     Competition. “Competition” will mean Employee’s direct or indirect engagement in (whether as an employee, consultant, agent, proprietor, principal, partner, stockholder, corporate officer, director or otherwise), or ownership interest in or participation in the financing, operation, management or control of, any person, firm, corporation or business that competes with Company or is a customer of the Company.

(e)     Disability. “Disability” will mean that Employee has been unable to perform the principal functions of Employee’s duties due to a physical or mental impairment, but only if such inability has lasted or is reasonably expected to last for at least six months. Whether Employee has a Disability will be determined by the Board based on evidence provided by one or more physicians selected by the Board.

(f)     Good Reason. “Good Reason” means the occurrence of any of the following without the Employee’s consent: (i) a material diminution in Employee’s Base Salary, except for reductions that are in proportion to any salary reduction program approved by the Board that affects a majority of the senior executives of the Company; (ii) a material diminution in Employee’s authority, duties, or responsibilities; (iii) a material diminution in the authority, duties, or responsibilities of the supervisor to whom Employee is required to report, including a requirements that Employee report to a corporate officer or employee instead of reporting directly to the Board; (iv)  a material change in the geographic location at which Employee must perform his services of not less than fifty (50) miles from the Company’s primary place of business immediately prior to such relocation; or (v) any other action or inaction that constitutes a material breach by the Company of this Agreement.

(g)     Section 409A Limit.  “Section 409A Limit” means the lesser of two (2) times: (i) Employee’s annualized compensation based upon the annual rate of pay paid to Employee during the Company’s taxable year preceding the Company’s taxable year of Employee’s termination of employment as determined under Treasury Regulation 1.409A-1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with respect thereto; or (ii) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the year in which Employee’s employment is terminated.

6.     Non-Solicitation. For a period beginning on the Effective Date and ending six (6) months after Employee ceases to be employed by the Company (the “Non-Solicitation Period”), Employee, directly or indirectly, whether as employee, owner, sole proprietor, partner, director, member, consultant, agent, founder, co-venturer or otherwise, will not: (i) solicit, induce or influence any person to leave employment with the Company; or (ii) directly or indirectly solicit business from any of the Company’s customers and users on behalf of any business that directly competes with the principal business of the Company; provided, however, that the Non-Solicitation Period shall end nine (9) months after Employee ceases to be employed by the Company in the event Employee’s employment is terminated pursuant to an Involuntary Termination; provided further, however, that the Non-Solicitation Period shall end twelve (12) months after Employee ceases to be employed by the Company in the event Employee’s employment is terminated pursuant to a Change of Control Termination.

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7.     Successors.

(a)     The Company’s Successors. Any successor to the Company (whether direct or indirect and whether by purchase, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company’s business and/or assets will assume the obligations under this Agreement and agree expressly to perform the obligations under this Agreement in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term “Company” will include any successor to the Company’s business and/or assets which executes and delivers the assumption agreement described in this Section 7(a) or which becomes bound by the terms of this Agreement by operation of law.

(b)     The Employee’s Successors. The terms of this Agreement and all rights of Employee hereunder will inure to the benefit of, and be enforceable by, Employee’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.

8.     Notice.

(a)     General. Notices and all other communications contemplated by this Agreement will be in writing and will be deemed to have been duly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of Employee, mailed notices will be addressed to him or her at the home address which he or she most recently communicated to the Company in writing. In the case of the Company, mailed notices will be addressed to its corporate headquarters, and all notices will be directed to the attention of its President.

(b)     Notice of Termination. Any termination by the Company for Cause or by Employee for Good Reason or as a result of a voluntary resignation will be communicated by a notice of termination to the other party hereto given in accordance with Section 8(a) of this Agreement. Such notice will indicate the specific termination provision in this Agreement relied upon, will set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination under the provision so indicated, and will specify the termination date (which will be not more than thirty (30) days after the giving of such notice). The failure by Employee to include in the notice any fact or circumstance which contributes to a showing of Good Reason will not waive any right of Employee hereunder or preclude Employee from asserting such fact or circumstance in enforcing his or her rights hereunder.

9.     Miscellaneous Provisions.

(a)     Code Section 409A. Notwithstanding anything to the contrary in this Agreement, if Employee is a “specified employee” within the meaning of Section 409A of the Code and any final regulations and guidance promulgated thereunder, as they each may be amended from time to time (“Section 409A”) at the time of Employee’s termination other than due to Employee’s death (provided that such termination is a “separation from service” within the meaning of Section 409A, as determined by the Company), then only that portion of the cash severance and shares subject to accelerated RSUs payable to Employee pursuant to this Agreement, if any, and any other severance payments or separation benefits, in each case which may be considered deferred compensation under Section 409A (together, the “Deferred Compensation Separation Benefits”), which (when considered together) do not exceed the Section 409A Limit (as defined herein) may be made within the first six (6) months following Employee’s termination of employment in accordance with the payment schedule applicable to each payment or benefit. Any portion of the Deferred Compensation Separation Benefits in excess of the Section 409A Limit otherwise due to Employee on or within the six (6) month period following Employee’s termination will accrue during such six (6) month period and will become payable in a lump sum payment on the date six (6) months and one (1) day following the date of Employee’s termination of employment. All subsequent Deferred Compensation Separation Benefits, if any, will be payable in accordance with the payment schedule applicable to each payment or benefit. Notwithstanding anything herein to the contrary, if Employee dies following his termination but prior to the six month anniversary of his date of termination, then any payments delayed in accordance with this paragraph will be payable in a lump sum as soon as administratively practicable after the date of Employee’s death and all other Deferred Compensation Separation Benefits will be payable in accordance with the payment schedule applicable to each payment or benefit. It is the intent of this Agreement to comply with the requirements of Section 409A so that none of the severance payments and benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply.

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(b)     No Duty to Mitigate. Employee will not be required to mitigate the amount of any payment contemplated by this Agreement, nor will any such payment be reduced by any earnings that Employee may receive from any other source.

(c)     Waiver. No provision of this Agreement will be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by Employee and by an authorized officer of the Company (other than Employee). No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other party will be considered a waiver of any other condition or provision or of the same condition or provision at another time.

(d)     Headings. All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement.

(e)     Entire Agreement. This Agreement constitutes the entire agreement of the parties hereto and supersedes in their entirety all prior representations, understandings, undertakings or agreements (whether oral or written and whether expressed or implied) of the parties with respect to the subject matter hereof, including (without limitation) the Employment Agreement). No future agreements between the Company and Employee may supersede this Agreement, unless they are in writing and specifically mention this Agreement. With respect to equity awards granted on or after the date hereof, the acceleration of vesting provided herein will apply to such awards except to the extent otherwise explicitly provided in the applicable equity award agreement, which provision must include a reference to this Agreement.

(f)     Choice of Law. The laws of the State of California (without reference to its choice of laws provisions) will govern the validity, interpretation, construction and performance of this Agreement.

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(g)     Severability. The invalidity or unenforceability of any provision or provisions of this Agreement will not affect the validity or enforceability of any other provision hereof, which will remain in full force and effect.

(h)     Withholding. All payments made pursuant to this Agreement will be subject to withholding of applicable income and employment taxes.

(i)     Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year set forth below.

GIGA-TRONICS INCORPORTED	John R. Regazzi
	By:          /S/ JOHN REGAZZI
	Title:                 CEO
EXECUTIVE	Michael R. Penta
	By:          /S/ MICHAEL R. PENTA
	Title:           Vice President Sales

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EX-10.22

EXHIBIT 10.22

GIGA-TRONICS INCORPORATED

SEVERANCE AGREEMENT

This Severance Agreement (the “Agreement”) is made and entered into by and between Steven D. Lance (“Employee”) and Giga-tronics Incorporated, a California Corporation (the “Company”), effective as of June 1, 2015 (the “Effective Date”). This agreement supersedes the Steven D. Lance Severance Agreement effective as of May 20, 2013.

RECITALS

1.     It is expected that the Company from time to time will consider the possibility of an acquisition by another company or other change of control. The Board of Directors of the Company (the “Board”) recognizes that such consideration can be a distraction to Employee and can cause Employee to consider alternative employment opportunities. The Board has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication and objectivity of Employee, notwithstanding the possibility, threat or occurrence of a Change of Control.

2.     The Board believes that it is in the best interests of the Company and its stockholders to provide Employee with an incentive to continue his or her employment and to motivate Employee to maximize the value of the Company for the benefit of its stockholders.

3.     The Board believes that it is imperative to provide Employee with certain benefits upon Employee’s termination of employment without cause or following a Change of Control. These benefits will provide Employee with enhanced financial security and incentive and encouragement to remain with the Company.

4.     Certain capitalized terms used in the Agreement are defined in Section 5 below.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto agree as follows:

1.     Term of Agreement. This Agreement will terminate upon the date that all of the obligations of the parties hereto with respect to this Agreement have been satisfied.

2.     At-Will Employment. The Company and Employee acknowledge that Employee’s employment is and will continue to be at-will, as defined under applicable law, except as may otherwise be specifically provided under the terms of any written formal employment agreement or offer letter between the Company and Employee (an “Employment Agreement”). If Employee’s employment terminates for any reason, Employee will not be entitled to any payments, benefits, damages, awards or compensation other than as provided by this Agreement, including any payments or benefits Employee would otherwise be entitled to under his or her Employment Agreement.

3.     Termination Benefits.

(a)     Involuntary Termination other than for Cause, Death or Disability Prior to a Change of Control or after Twelve Months Following a Change of Control. If, prior to a Change of Control or after twelve (12) months following a Change of Control, the Company (or any parent or subsidiary of the Company employing Employee) terminates Employee’s employment with the Company (or any parent or subsidiary of the Company) without Employee’s consent and for a reason other than (x) Cause, (y) Employee becoming Disabled or (z) Employee’s death, (any such termination, an “Involuntary Termination”) and Employee signs, delivers and does not revoke a separation agreement and release of claims in a form satisfactory to the Company (the “Release”) within the time period required by the Release (but in no event later than two and one-half (2½) months following the end of the calendar year in which the Involuntary Termination occurs), then following such termination of employment, or, if later, the effective date of the Release, Employee will receive the following payments and other benefits from the Company:

(i)     Accrued Compensation. Employee will be entitled to receive all accrued vacation, expense reimbursements and any other benefits due to Employee through the date of termination of employment in accordance with the Company’s then existing employee benefit plans, policies and arrangements.

(ii)     Severance. Subject to Section 9(a), Employee will be entitled to receive continued payments of Employee’s trailing 12 month salary (as in effect immediately prior to such termination) for a period of nine (9) months (the “Severance Period”), less applicable withholding payable in accordance with the Company’s normal payroll policies. Notwithstanding the foregoing and except as provided by the following sentence, if during the Severance Period Employee engages in Competition or breaches the covenants in Section 6 or in the Release, all payments pursuant to this subsection will immediately cease effective as of the first date that constitutes engagement in Competition or a breach of the applicable covenants (the “Breach Date”). Notwithstanding the preceding sentence, if payment of the severance amounts is delayed in accordance with Section 9(a) of this Agreement, the Company’s obligation to make severance payments to Executive during the Severance Period shall not terminate pursuant to the preceding sentence (i.e., upon the Breach Date) with respect to any severance payments that have been accrued prior to the Breach Date in accordance with Section 9(a) of this Agreement and such accrued severance payments shall be paid in a lump sum payment on the date six (6) months and one (1) day following the date of Executive’s termination of employment (or such earlier date as provided in Section 9(a) of this Agreement).

(iii)     Continued Employee Benefits. The Company will reimburse Employee for premiums paid for the continuation of benefits Employee timely elects pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”)for Employee and Employee’s eligible dependents under the Company’s Benefit Plans for a period of nine (9) months following Employee’s termination of employment; provided, however, that if during such period Employee engages in Competition or breaches the covenants in Section 6 or in the Release, all Company-reimbursements pursuant to this subsection will immediately cease. Employee will be solely responsible for electing such continuation coverage for Employee and Employee’s eligible dependents.

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(iv)     Options. With respect to all of Employee’s options (the “Options”) to purchase Company common stock outstanding on the date of such termination (whether granted on, before or after the date of this Agreement), Employee will have the period following such termination of employment to exercise such Options that is specified in the stock plans, if any, under which the Options were granted and in any applicable agreements between the Company and Employee; provided, however, to the extent that, pursuant to the provisions of such stock plans and applicable agreements, such Options continue to vest during the period, if any, that Employee provides consulting services to the Company pursuant to Section 3(a)(ii) or otherwise, then Employee will have the period following the termination of such consulting services to exercise such Options that is specified in such stock plans and applicable agreements; provided further, however, that all Options will immediately terminate and Employee will have no further rights with respect to such Options in the event Employee engages in Competition or breaches the covenants in Section 6 or in the Release during such period. In all other respects, such Options will continue to be subject to the terms and conditions of the stock plans, if any, under which they were granted and any applicable agreements between the Company and Employee.

(v)     Payments or Benefits Required by Law. Employee will receive such other compensation or benefits from the Company as may be required by law (for example, “COBRA” coverage under Section 4980B of the Internal Revenue Code of 1986, as amended (the “Code”)).

(b)     Involuntary Termination other than for Cause, Death or Disability or Termination for Good Reason within Twelve Months of a Change of Control. If (i) within twelve (12) months following a Change of Control (A) Employee terminates his or her employment with the Company (or any parent or subsidiary of the Company) for Good Reason or (B) the Company (or any parent or subsidiary of the Company) terminates Employee’s employment for other than (x) Cause, (y) Employee becoming Disabled or (z) Employee’s death (any such termination pursuant to (A) or (B), a “Change of Control Termination”) and (ii) Employee signs, delivers and does not revoke a Release within the time period required by the Release (but in no event later than two and one-half (2½) months following the end of the calendar year in which the Involuntary Termination occurs), then promptly following such termination of employment, or, if later, the effective date of the Release, Employee will receive the following payments and other benefits from the Company:

(i)     Accrued Compensation. Employee will be entitled to receive all accrued vacation, expense reimbursements and any other benefits due to Employee through the date of termination of employment in accordance with the Company’s then existing employee benefit plans, policies and arrangements.

(ii)     Severance. Subject to Section 9(a), Employee will be entitled to receive continued payments of Employee’s trailing 12 month salary (as in effect immediately prior to such termination) for a period of twelve (12) months (the “Post-Change of Control Severance Period”), less applicable withholding, payable in accordance with the Company’s normal payroll policies. Notwithstanding the foregoing and except as provided by the following sentence, if during the Post-Change of Control Severance Period Employee engages in Competition or breaches the covenants in Section 6 or in the Release, all payments pursuant to this subsection will immediately cease effective as of the Breach Date. Notwithstanding the preceding sentence, if payment of the severance amounts is delayed in accordance with Section 9(a) of this Agreement, the Company’s obligation to make severance payments to Executive during the Post-Change of Control Severance Period shall not terminate pursuant to the preceding sentence (i.e., upon the Breach Date) with respect to any severance payments that have been accrued prior to the Breach Date in accordance with Section 9(a) of this Agreement and such accrued severance payments shall be paid in a lump sum payment on the date six (6) months and one (1) day following the date of Executive’s termination of employment (or such earlier date as provided in Section 9(a) of this Agreement).

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(iii)     Options, Restricted Stock and Restricted Stock Units. 100% of the unvested shares subject to all of Employee’s Options, 100% of the unvested shares subject to all of Employee’s restricted stock units (“RSUs”) and 100% any of Employee’s shares of Company common stock subject to restrictions (the “Restricted Stock”) whether acquired by Employee on, before or after the date of this Agreement, will immediately vest upon such termination. With respect to all of Employee’s Options outstanding on the date of such termination (whether granted on, before or after the date of this Agreement), Employee will have the period following such termination of employment to exercise such Options that is specified in the stock plans, if any, under which the Options were granted and in any applicable agreements between the Company and Employee; provided, however, that all Options will immediately terminate and Employee will have no further rights with respect to such Options in the event Employee engages in Competition or breaches the covenants in Section 6 or in the Release during such period. In all other respects, such Options will continue to be subject to the terms and conditions of the stock plans, if any, under which they were granted and any applicable agreements between the Company and Employee.

(iv)     Continued Employee Benefits. The Company will reimburse Employee for premiums paid for the continuation of benefits Employee timely elects pursuant to the COBRAfor Employee and Employee’s eligible dependents under the Company’s Benefit Plans for a period of twelve (12) months following Employee’s termination of employment; provided, however, that if during such period Employee engages in Competition or breaches the covenants in Section 6 or in the Release, all Company-reimbursements pursuant to this subsection will immediately cease. Employee will be solely responsible for electing such continuation coverage for Employee and Employee’s eligible dependents.

(v)     Payments or Benefits Required by Law. Employee will receive such other compensation or benefits from the Company as may be required by law (for example, “COBRA” coverage under Section 4980B of the Code).

(c)     Other Terminations. If Employee voluntarily terminates Employee’s employment with the Company or any parent or subsidiary of the Company (other than for Good Reason within twelve (12) months of a Change of Control) or if the Company (or any parent or subsidiary of the Company employing Employee) terminates Employee employment with the Company (or any parent or subsidiary of the Company) for Cause, then Employee will (i) receive his or her earned but unpaid base salary through the date of termination of employment, (ii) receive all accrued vacation, expense reimbursements and any other benefits due to Employee through the date of termination of employment in accordance with established Company plans, policies and arrangements, and (iii) not be entitled to any other compensation or benefits (including, without limitation, accelerated vesting of Options or Restricted Stock) from the Company except to the extent provided under the applicable stock option agreement(s) or as may be required by law (for example, “COBRA” coverage under Section 4980B of the Code).

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(d)     Termination due to Death or Disability. If Employee’s employment with the Company (or any parent or subsidiary of the Company) is terminated due to Employee’s death or Employee’s becoming Disabled, then Employee or Employee’s estate (as the case may be) will (i) receive the earned but unpaid base salary through the date of termination of employment, (ii) receive all accrued vacation, expense reimbursements and any other benefits due to Employee through the date of termination of employment in accordance with Company-provided or paid plans, policies and arrangements, and (iii) not be entitled to any other compensation or benefits from the Company except to the extent required by law (for example, “COBRA” coverage under Section 4980B of the Code).

(e)     Exclusive Remedy. In the event of a termination of Employee’s employment with the Company (or any parent or subsidiary of the Company), the provisions of this Section 3 are intended to be and are exclusive and in lieu of any other rights or remedies to which Employee or the Company may otherwise be entitled (including any contrary provisions in the Employment Agreement), whether at law, tort or contract, in equity, or under this Agreement. Employee will be entitled to no benefits, compensation or other payments or rights upon termination of employment other than those benefits expressly set forth in this Section 3.

4.     Limitation on Payments. In the event that the severance and other benefits provided for in this Agreement or otherwise payable to Employee (i) constitute “parachute payments” within the meaning of Section 280G of the Code and (ii) but for this Section 4, would be subject to the excise tax imposed by Section 4999 of the Code, then Employee’s severance benefits under Section 4(a)(i) will be either:

(a)     delivered in full, or

(b)     delivered as to such lesser extent which would result in no portion of such severance benefits being subject to excise tax under Section 4999 of the Code,

whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the excise tax imposed by Section 4999, results in the receipt by Employee on an after-tax basis, of the greatest amount of severance benefits, notwithstanding that all or some portion of such severance benefits may be taxable under Section 4999 of the Code. Unless the Company and Employee otherwise agree in writing, any determination required under this Section 4 will be made in writing by BDO Seidman or by a national “Big Four” accounting firm (the “Accountants”), whose determination will be conclusive and binding upon Employee and the Company for all purposes. For purposes of making the calculations required by this Section 4, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code. The Company and Employee will furnish to the Accountants such information and documents as the Accountants may reasonably request in order to make a determination under this Section. The Company will bear all costs the Accountants may reasonably incur in connection with any calculations contemplated by this Section 4.

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5.     Definition of Terms. The following terms referred to in this Agreement will have the following meanings:

(a)     Benefit Plans. “Benefit Plans” means plans, policies or arrangements that the Company sponsors (or participates in) and that immediately prior to Employee’s termination of employment provide Employee and/or Employee’s eligible dependents with medical, dental, and/or vision benefits. Benefit Plans do not include any other type of benefit (including, but not by way of limitation, disability, life insurance or retirement benefits). A requirement that the Company provide Employee and Employee’s eligible dependents with coverage under the Benefit Plans will not be satisfied unless the coverage is no less favorable than that provided to Employee and Employee’s eligible dependents immediately prior to Employee’s termination of employment.

(b)     Cause. “Cause” means (i) a willful failure by Employee to substantially perform Employee’s duties as an employee, other than a failure resulting from the Employee’s complete or partial incapacity due to physical or mental illness or impairment, (ii) a willful act by Employee that constitutes gross misconduct and that is injurious to the Company, (iii) circumstances where Employee willfully imparts material confidential information relating to the Company or its business to competitors or to other third parties other than in the course of carrying out Employee’s duties, (iv) a material and willful violation by Employee of a federal or state law or regulation applicable to the business of the Company that is injurious to the Company, or (v) Employee’s conviction or plea of guilty or no contest to a felony, which the Company reasonably believes has or will negatively reflect on the Company’s business or reputation. No act or failure to act by Employee will be considered “willful” unless committed without good faith and without a reasonable belief that the act or omission was in the Company’s best interest.

(c)     Change of Control. “Change of Control” means the occurrence of any of the following:

(i)     the sale, lease, conveyance or other disposition of all or substantially all of the Company’s assets to any “person” (as such term is used in Section 13(d) of the Securities Exchange Act of 1934, as amended), entity or group of persons acting in concert;

(ii)     any person or group of persons becoming the “beneficial owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the Company’s then outstanding voting securities;

(iii)     a merger or consolidation of the Company with any other corporation, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its controlling entity) at least 50% of the total voting power represented by the voting securities of the Company or such surviving entity (or its controlling entity) outstanding immediately after such merger or consolidation; or

(iv)     a contest for the election or removal of members of the Board that results in the removal from the Board of at least 50% of the incumbent members of the Board.

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(d)     Competition. “Competition” will mean Employee’s direct or indirect engagement in (whether as an employee, consultant, agent, proprietor, principal, partner, stockholder, corporate officer, director or otherwise), or ownership interest in or participation in the financing, operation, management or control of, any person, firm, corporation or business that competes with Company or is a customer of the Company.

(e)     Disability. “Disability” will mean that Employee has been unable to perform the principal functions of Employee’s duties due to a physical or mental impairment, but only if such inability has lasted or is reasonably expected to last for at least six months. Whether Employee has a Disability will be determined by the Board based on evidence provided by one or more physicians selected by the Board.

(f)     Good Reason. “Good Reason” means the occurrence of any of the following without the Employee’s consent: (i) a material diminution in Employee’s Base Salary, except for reductions that are in proportion to any salary reduction program approved by the Board that affects a majority of the senior executives of the Company; (ii) a material diminution in Employee’s authority, duties, or responsibilities; (iii) a material diminution in the authority, duties, or responsibilities of the supervisor to whom Employee is required to report, including a requirements that Employee report to a corporate officer or employee instead of reporting directly to the Board; (iv)  a material change in the geographic location at which Employee must perform his services of not less than fifty (50) miles from the Company’s primary place of business immediately prior to such relocation; or (v) any other action or inaction that constitutes a material breach by the Company of this Agreement.

(g)     Section 409A Limit.  “Section 409A Limit” means the lesser of two (2) times: (i) Employee’s annualized compensation based upon the annual rate of pay paid to Employee during the Company’s taxable year preceding the Company’s taxable year of Employee’s termination of employment as determined under Treasury Regulation 1.409A-1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with respect thereto; or (ii) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the year in which Employee’s employment is terminated.

6.     Non-Solicitation. For a period beginning on the Effective Date and ending six (6) months after Employee ceases to be employed by the Company (the “Non-Solicitation Period”), Employee, directly or indirectly, whether as employee, owner, sole proprietor, partner, director, member, consultant, agent, founder, co-venturer or otherwise, will not: (i) solicit, induce or influence any person to leave employment with the Company; or (ii) directly or indirectly solicit business from any of the Company’s customers and users on behalf of any business that directly competes with the principal business of the Company; provided, however, that the Non-Solicitation Period shall end nine (9) months after Employee ceases to be employed by the Company in the event Employee’s employment is terminated pursuant to an Involuntary Termination; provided further, however, that the Non-Solicitation Period shall end twelve (12) months after Employee ceases to be employed by the Company in the event Employee’s employment is terminated pursuant to a Change of Control Termination.

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7.     Successors.

(a)     The Company’s Successors. Any successor to the Company (whether direct or indirect and whether by purchase, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company’s business and/or assets will assume the obligations under this Agreement and agree expressly to perform the obligations under this Agreement in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term “Company” will include any successor to the Company’s business and/or assets which executes and delivers the assumption agreement described in this Section 7(a) or which becomes bound by the terms of this Agreement by operation of law.

(b)     The Employee’s Successors. The terms of this Agreement and all rights of Employee hereunder will inure to the benefit of, and be enforceable by, Employee’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.

8.     Notice.

(a)     General. Notices and all other communications contemplated by this Agreement will be in writing and will be deemed to have been duly given when personally delivered or when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of Employee, mailed notices will be addressed to him or her at the home address which he or she most recently communicated to the Company in writing. In the case of the Company, mailed notices will be addressed to its corporate headquarters, and all notices will be directed to the attention of its President.

(b)     Notice of Termination. Any termination by the Company for Cause or by Employee for Good Reason or as a result of a voluntary resignation will be communicated by a notice of termination to the other party hereto given in accordance with Section 8(a) of this Agreement. Such notice will indicate the specific termination provision in this Agreement relied upon, will set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination under the provision so indicated, and will specify the termination date (which will be not more than thirty (30) days after the giving of such notice). The failure by Employee to include in the notice any fact or circumstance which contributes to a showing of Good Reason will not waive any right of Employee hereunder or preclude Employee from asserting such fact or circumstance in enforcing his or her rights hereunder.

9.     Miscellaneous Provisions.

(a)     Code Section 409A. Notwithstanding anything to the contrary in this Agreement, if Employee is a “specified employee” within the meaning of Section 409A of the Code and any final regulations and guidance promulgated thereunder, as they each may be amended from time to time (“Section 409A”) at the time of Employee’s termination other than due to Employee’s death (provided that such termination is a “separation from service” within the meaning of Section 409A, as determined by the Company), then only that portion of the cash severance and shares subject to accelerated RSUs payable to Employee pursuant to this Agreement, if any, and any other severance payments or separation benefits, in each case which may be considered deferred compensation under Section 409A (together, the “Deferred Compensation Separation Benefits”), which (when considered together) do not exceed the Section 409A Limit (as defined herein) may be made within the first six (6) months following Employee’s termination of employment in accordance with the payment schedule applicable to each payment or benefit. Any portion of the Deferred Compensation Separation Benefits in excess of the Section 409A Limit otherwise due to Employee on or within the six (6) month period following Employee’s termination will accrue during such six (6) month period and will become payable in a lump sum payment on the date six (6) months and one (1) day following the date of Employee’s termination of employment. All subsequent Deferred Compensation Separation Benefits, if any, will be payable in accordance with the payment schedule applicable to each payment or benefit. Notwithstanding anything herein to the contrary, if Employee dies following his termination but prior to the six month anniversary of his date of termination, then any payments delayed in accordance with this paragraph will be payable in a lump sum as soon as administratively practicable after the date of Employee’s death and all other Deferred Compensation Separation Benefits will be payable in accordance with the payment schedule applicable to each payment or benefit. It is the intent of this Agreement to comply with the requirements of Section 409A so that none of the severance payments and benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply.

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(b)     No Duty to Mitigate. Employee will not be required to mitigate the amount of any payment contemplated by this Agreement, nor will any such payment be reduced by any earnings that Employee may receive from any other source.

(c)     Waiver. No provision of this Agreement will be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by Employee and by an authorized officer of the Company (other than Employee). No waiver by either party of any breach of, or of compliance with, any condition or provision of this Agreement by the other party will be considered a waiver of any other condition or provision or of the same condition or provision at another time.

(d)     Headings. All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement.

(e)     Entire Agreement. This Agreement constitutes the entire agreement of the parties hereto and supersedes in their entirety all prior representations, understandings, undertakings or agreements (whether oral or written and whether expressed or implied) of the parties with respect to the subject matter hereof, including (without limitation) the Employment Agreement). No future agreements between the Company and Employee may supersede this Agreement, unless they are in writing and specifically mention this Agreement. With respect to equity awards granted on or after the date hereof, the acceleration of vesting provided herein will apply to such awards except to the extent otherwise explicitly provided in the applicable equity award agreement, which provision must include a reference to this Agreement.

(f)     Choice of Law. The laws of the State of California (without reference to its choice of laws provisions) will govern the validity, interpretation, construction and performance of this Agreement.

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(g)     Severability. The invalidity or unenforceability of any provision or provisions of this Agreement will not affect the validity or enforceability of any other provision hereof, which will remain in full force and effect.

(h)     Withholding. All payments made pursuant to this Agreement will be subject to withholding of applicable income and employment taxes.

(i)     Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

[Remainder of Page Intentionally Left Blank]

-10-

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year set forth below.

GIGA-TRONICS INCORPORTED	John R. Regazzi
	By:          /S/ JOHN REGAZZI
	Title:            CEO
EXECUTIVE	Steven D. Lance
	By:          /S/STEVEN D. LANCE
	Title:                      CFO

-11-

EX-21

EXHIBIT 21

SIGNIFICANT SUBSIDIARIES
	Name	Jurisdiction of incorporation
	Microsource, Inc.	California

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statements (Nos. 333-45476, 333-34719, 333-48889, 333-39403, 333-69688 and 333-135578) on Form S-8 of Giga-tronics Incorporated of our report dated June 9, 2015 relating to the consolidated financial statements, appearing in this Annual Report on Form 10-K.

/s/ Crowe Horwath LLP

San Francisco, California

June 9, 2015

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, John R. Regazzi, certify that:

1. I have reviewed this Annual Report on Form 10-K of Giga-tronics, Inc.;

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

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

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

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

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

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

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

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

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

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

Date: 06/09/2015
	/s/  JOHN R. REGAZZI
	John R. Regazzi
	Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Steven D. Lance, certify that:

1. I have reviewed this Annual Report on Form 10-K of Giga-tronics, Inc.;

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

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

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

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

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

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

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

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

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

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

Date: 06/09/2015
	/s/  STEVEN D. LANCE
	Steven D. Lance
	Vice President of Finance/
	Chief Financial Officer & Secretary

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Giga-tronics Incorporated (the "Company") on Form 10-K for the period ending March 28, 2015, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, John R. Regazzi, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

Date: 06/09/2015
	/s/  JOHN R. REGAZZI
	John R. Regazzi
	Chief Executive Officer

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Giga-tronics Incorporated (the "Company") on Form 10-K for the period ending March 28, 2015, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Steven D. Lance, Vice President of Finance, Chief Financial Officer and Secretary, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

Date: 06/09/2015
	/s/  STEVEN D. LANCE
	Steven D. Lance
	Vice President of Finance,
	Chief Financial Officer & Secretary

XML

Note 1 - Summary of Significant Accounting Policies (Details) (USD $)	12 Months Ended		1 Months Ended	3 Months Ended
	Mar. 28, 2015	Mar. 29, 2014	May 29, 2015	Mar. 30, 2015
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Net Income (Loss) Attributable to Parent	$ (1,673,000)	$ (3,742,000)
Warrant Expense	1,232,000
Amortization of Debt Discount (Premium)	152,000	0
Operating Income (Loss)	14,000	(4,539,000)
Number of Major Customers	2
Unbilled Receivables, Not Billable, Amount Expected to be Collected in Remainder of Fiscal Year	6,500,000
Revenue Recognition, Milestone Method, Revenue Recognized	4,700,000	486,000
Research and Development Expense	3,210,000	3,897,000
Asset Impairment Charges	0	0
Machinery and Equipment [Member] | Minimum [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Property, Plant and Equipment, Useful Life	3 years
Machinery and Equipment [Member] | Maximum [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Property, Plant and Equipment, Useful Life	10 years
Series C and D Warrants [Member] | Alara Capital AVI II, LLC [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares)				1,002,818
Long-term Debt [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Long-term Debt	1,100,000	822,000
Long-term Debt, Fair Value	1,200,000
Warrant Debt [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Long-term Debt	82,000	50,000
Long-term Debt, Fair Value	112,000
Subsequent Event [Member] | Revolving Credit Facility [Member] | Bridge Bank [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Debt Instrument, Term			2 years
Long-term Line of Credit			2,500,000
Line of Credit Facility, Maximum Borrowing Capacity			3,000,000
Subsequent Event [Member] | Revolving Credit Facility Not Tied to Accounts Receivables [Member] | Bridge Bank [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity			500,000
Accounts Receivable [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Number of Major Customers	3
Concentration Risk, Percentage	65.00%
2005 Equity Incentive Plan [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in Shares)	2,250,000
Alara Capital AVI II, LLC [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Proceeds from Warrant Exercises				1,500,000
Alara Capital AVI II, LLC [Member]
Note 1 - Summary of Significant Accounting Policies (Details) [Line Items]
Warrant Expense	$ 1,200,000

XML

Note 9 - Income Taxes (Details) - Liability for Uncertain Tax Positions (USD $)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Liability for Uncertain Tax Positions [Abstract]
Balance as of beginning of year	$ 70,000	$ 1,649,000
Additions based on current year tax positions	23,000
(Reductions) additions for prior year tax positions		(1,579,000)
Balance as of end of year	$ 93,000	$ 70,000

XML

Note 7 - Significant Customer and Industry Segment Information (Details) - Export Sales by Geographic Area (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Note 7 - Significant Customer and Industry Segment Information (Details) - Export Sales by Geographic Area [Line Items]
Revenue	$ 1,467	$ 1,477
Americas [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) - Export Sales by Geographic Area [Line Items]
Revenue	26	169
Europe [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) - Export Sales by Geographic Area [Line Items]
Revenue	179	661
Asia [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) - Export Sales by Geographic Area [Line Items]
Revenue	1,085	507
Rest of World [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) - Export Sales by Geographic Area [Line Items]
Revenue	$ 177	$ 140

XML

Note 18 - Subsequent Events (Details) (USD $)	0 Months Ended
	Jun. 01, 2015	Jun. 11, 2013	Jun. 16, 2014
Note 18 - Subsequent Events (Details) [Line Items]
Line of Credit Facility, Principle Amounts Payable	$ 10,000
Subsequent Event [Member] | Non-Formula Basis Sub-Limit [Member] | New Amended Credit Facility 2 [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	500,000
Subsequent Event [Member] | Borrowing Base for International Services Sub-Limit [Member] | New Amended Credit Facility 2 [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	100,000
Subsequent Event [Member] | Borrowing Base for Cash Management Services Sub-Limit [Member] | New Amended Credit Facility 2 [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	100,000
Subsequent Event [Member] | Due on the Anniversary of the Loan Closing [Member] | New Amended Credit Facility 2 [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Line of Credit Facility, Commitment Fee Amount	12,500
Subsequent Event [Member] | PFG Loan [Member] | Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Long-term Line of Credit	500,000
Line of Credit Facility Borrowing Capacity Cancelled	500,000
Line of Credit Facility, Principle Amounts Payable	150,000
Subsequent Event [Member] | New Amended Credit Facility 2 [Member] | Prime Rate [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.50%
Debt Instrument, Variable Interest Rate	3.25%
Subsequent Event [Member] | New Amended Credit Facility 2 [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Long-term Line of Credit	2,500,000
Line of Credit Facility, Maximum Borrowing Capacity	2,500,000
Advance Rate	80.00%
Debt Instrument, Interest Rate, Effective Percentage	4.75%
Line of Credit Facility, Commitment Fee Amount	12,500
Asset Coverage Ratio	135.00%
Accounts Receivable, Aging from Invoice Date	90 days
PFG Loan [Member] | Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Long-term Line of Credit			500,000
Line of Credit Facility, Maximum Borrowing Capacity			500,000
Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity			$ 500,000
Prime Rate [Member]
Note 18 - Subsequent Events (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate		2.00%

XML

Note 10 - Share-based Compensation and Employee Benefit Plans (Details) (USD $)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014	Mar. 30, 2013
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Percent of Fair Market Value of Common Stock at Date of Grant	100.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares)	432,000	101,500
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in Shares)	397,425
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share)	$ 1.66	$ 1.07
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized	$ 1,200,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	2 years 6 months
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares (in Shares)	280,650	320,525
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value	120,000	365,000
Proceeds from Stock Options Exercised	163,000	0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in Shares)	306,500	430,750
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share)	$ 2.11	$ 1.53
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Percent	100.00%
Defined Contribution Plan, Vesting Period	4 years
Defined Contribution Plan, Employer Discretionary Contribution Amount	39,000	44,000
Options Granted to Employees [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award Expiration	10 years
Stock Appreciation Rights (SARs) [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares)	0
Outstanding Options [Member] | Minimum [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award Expiration	5 years
Outstanding Options [Member] | Maximum [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award Expiration	10 years
Employee Stock Option [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Allocated Share-based Compensation Expense	370,000	310,000
Share-based Compensation Arrangement by Share-based Payment Award, Accelerated Vesting, Number (in Shares)		40,000
Share-based Compensation Arrangement by Share-based Payment Award Accelerated Compensation Cost		7,000
Performance-based Options [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Allocated Share-based Compensation Expense	29,000	0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in Shares)	100,000
Restricted Stock [Member] | Director [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares)	432,000	71,500
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share)	$ 2.11	$ 1.53
Restricted Stock [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares)			50,000
Allocated Share-based Compensation Expense	$ 457,000	$ 184,000
Restricted Stock, Employee Severance [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in Shares)		30,000
Minimum [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	4 years
Maximum [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	5 years
2000 Stock Option Plan and 2005 Equity Incentive Plan [Member]
Note 10 - Share-based Compensation and Employee Benefit Plans (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in Shares)	2,250,000

XML

Note 7 - Significant Customer and Industry Segment Information (Details)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Note 7 - Significant Customer and Industry Segment Information (Details) [Line Items]
Number of Reportable Segments	2
U.S. Government and Defence-Related Customers [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) [Line Items]
Concentration Risk, Percentage	69.00%	57.00%
Second Customer [Member] | Gigatronics [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) [Line Items]
Concentration Risk, Percentage		16.00%
Second Customer [Member] | Microsource [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) [Line Items]
Concentration Risk, Percentage	23.00%
Third Customer [Member] | Microsource [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) [Line Items]
Concentration Risk, Percentage	14.00%
Gigatronics [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) [Line Items]
Concentration Risk, Percentage	28.00%	39.00%
Export Sales [Member]
Note 7 - Significant Customer and Industry Segment Information (Details) [Line Items]
Concentration Risk, Percentage	8.00%	11.00%

XML

Note 9 - Income Taxes (Tables)

12 Months Ended

Mar. 28, 2015

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

Fiscal years ended (In thousands)	March 28, 2015			March 29, 2014
Current
Federal	$	—		$	—
State		47			2
Total current		47			2
Deferred
Federal		210			(568	)
State		391			(330	)
Total deferred		601			(898	)
Change in liability for uncertain tax positions		23			1,579
Change in valuation allowance		(624	)		(681	)
Provision for income taxes	$	47		$	2

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

Fiscal years ended (In thousands)	March 28, 2015			March 29, 2014
Net operating loss carryforwards	$	13,657		$	14,300
Income tax credits		306			143
Inventory reserves and additional costs capitalized		1,974			2,051
Accrued vacation		133			129
Deferred rent		95			136
Non-qualified stock options and restricted stock		247			211
Other		48			114
Total deferred tax assets		16,460			17,084
Valuation allowance		(16,460	)		(17,084	)
Net deferred tax assets	$	—		$	—

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

Fiscal years ended (In thousands except percentages)	March 28, 2015					March 29, 2014
Statutory federal income tax (benefit)	$	(553	)	34	%	$	(1,256	)	34	%
Valuation allowance		(624	)	38.4			681		(18.4	)
State income tax, net of federal benefit		(95	)	5.8			(216	)	5.8
Net operating loss expiration		861		(53.0	)		—		—
Non tax-deductible expenses		593		(36.5	)		132		(3.6	)
Tax credits		(187	)	11.5			2,238		(60.6	)
Liability for uncertain tax positions		23		(1.4	)		(1,579	)	42.8
Other		29		(1.8	)		2		(0.1	)
Effective income tax	$	47		3.0	%	$	2		(0.1	)%

Schedule of Unrecognized Tax Benefits Roll Forward [Table Text Block]

(In thousands)	Fiscal Year 2015		Fiscal Year 2014
Balance as of beginning of year	$	70	$	1,649
Additions based on current year tax positions		23		—
(Reductions) additions for prior year tax positions		—		(1,579	)
Balance as of end of year	$	93	$	70

XML

Note 10 - Share-based Compensation and Employee Benefit Plans (Details) - Changes in Stock Options Outstanding (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014	Mar. 30, 2013
Changes in Stock Options Outstanding [Abstract]
Outstanding, Shares	1,738,750		1,556,250
Outstanding, Weighted Average Exercise Price	$ 1.53		$ 1.62
Outstanding, Weighted Average Remaining Contractual Term (Years)	6 years 328 days	6 years 292 days	6 years 292 days
Outstanding, Aggregate Intrinsic Value	$ 219	$ 113	$ 252
Exercisable at March 28, 2015	618,975
Exercisable at March 28, 2015	$ 1.62
Exercisable at March 28, 2015	6 years 36 days
Exercisable at March 28, 2015	59
At March 28, 2015, expected to vest in the future	761,212
At March 28, 2015, expected to vest in the future	$ 1.54
At March 28, 2015, expected to vest in the future	7 years 146 days
At March 28, 2015, expected to vest in the future	$ 107
Granted, Shares	306,500	430,750
Granted, Weighted Average Exercise Price	$ 2.01	$ 1.32
Exercised, Shares	90,000
Exercised, Weighted Average Exercise Price	$ 1.80
Forfeited/expired, Shares	228,275	248,250
Forfeited/expired, Weighted Average Exercise Price	$ 1.81	$ 1.72
Outstanding, Shares	1,726,975	1,738,750
Outstanding, Weighted Average Exercise Price	$ 1.57	$ 1.53
Forfeited/expired, Shares	228,275	248,250

XML

Note 17 - Exercise of Series C and Series D Warrants

12 Months Ended

Mar. 28, 2015

Warrants [Abstract]

Warrants [Text Block]

17       Exercise of Series C and Series D Warrants

On February 16, 2015, the Company entered into a Securities Purchase Agreement and Warrant Agreement with Alara Capital AVI II, LLC (“Alara Capital”), an investment vehicle sponsored by AVI Partners, LLC (“AVI” ) (with both entities collectively referred to herein as “Alara”), in which the Company received total gross cash proceeds of approximately $1.5 million. Funds were received from Alara in separate closings dated February 16, 2015 and February 23, 2015 in which Alara exercised a total of 1,002,818 of its existing Series C and Series D warrants to purchase common shares, all of which had an exercise price of $1.43 per share for total cash proceeds of $1,434,000, which was recorded net of $42,000 of stock issuance costs. As part of the consideration for this exercise, the Company sold to Alara two new warrants to purchase an additional 898,634 and 194,437 common shares at an exercise price of $1.78 and $1.76 per share, respectively, for a total purchase price of $137,000 or $0.125 per share, The new warrants have a term of five years and may be paid in cash or through a cashless net share settlement. The Company and Alara amended the remaining 14,587 warrants as part of the February closings. On May 14, 2015, Alara exercised the remaining 14,587 warrants by acquiring 7,216 of shares of the Company’s common stock through a cashless net share settlement. The Company recorded the issuance of the new Warrants using their estimated fair value on the date of issuance.  The Company estimated the fair value of the new Warrants using the Black-Scholes option valuation model with the following assumptions: expected term of 5 years, a risk-free interest rate of 1.54%, expected volatility of 90% and 0% expected dividend yield. The resulting $1.2 million from the issuance of the new Warrants was recorded as a charge to other expense in the current period.

XML

Note 9 - Income Taxes (Details) (USD $)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014	Mar. 30, 2013
Note 9 - Income Taxes (Details) [Line Items]
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	34.00%	34.00%
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount	$ (624,000)
Unrecognized Tax Benefits	93,000	70,000	1,649,000
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued	0
Domestic Tax Authority [Member]
Note 9 - Income Taxes (Details) [Line Items]
Operating Loss Carryforwards	35,900,000
State and Local Jurisdiction [Member]
Note 9 - Income Taxes (Details) [Line Items]
Operating Loss Carryforwards	$ 25,000,000

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Note 3 - Inventories (Details) - Inventories (USD $) In Thousands, unless otherwise specified	Mar. 28, 2015	Mar. 29, 2014
Inventories [Abstract]
Raw materials	$ 1,631	$ 1,501
Work-in-progress	1,598	1,400
Finished goods	15	353
Demonstration inventory	121	67
Total	$ 3,365	$ 3,321

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Note 15 - Term Loan, Revolving Line of Credit and Warrants (Tables)

12 Months Ended

Mar. 28, 2015

Disclosure Text Block [Abstract]

Schedule of Maturities of Long-term Debt [Table Text Block]

Fiscal year (Dollars in thousands)	Principal		Interest		Total
2016	$	870		92		962
2017		430		18		448
Total	$	1,300	$	110	$	1,410

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Note 9 - Income Taxes (Details) - Deferred Tax Assets (USD $) In Thousands, unless otherwise specified	Mar. 28, 2015	Mar. 29, 2014
Deferred Tax Assets [Abstract]
Net operating loss carryforwards	$ 13,657	$ 14,300
Income tax credits	306	143
Inventory reserves and additional costs capitalized	1,974	2,051
Accrued vacation	133	129
Deferred rent	95	136
Non-qualified stock options and restricted stock	247	211
Other	48	114
Total deferred tax assets	16,460	17,084
Valuation allowance	(16,460)	(17,084)
Net deferred tax assets	$ 0	$ 0

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Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) (USD $)	12 Months Ended	0 Months Ended	12 Months Ended	0 Months Ended
	Mar. 29, 2014	Nov. 10, 2011	Mar. 28, 2015	Feb. 19, 2013	Jul. 08, 2013	Feb. 23, 2015	Feb. 16, 2015	Feb. 28, 2014
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Preferred Stock, Shares Issued (in Shares)			18,533.51
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs	$ 41,000
Proceeds from Issuance of Preferred Stock and Preference Stock	817,000
Series B Preferred Stock [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Proceeds from Issuance of Preferred Stock, Preference Stock, and Warrants		2,199,000
Preferred Stock, Shares Issued (in Shares)		9,997	9,997.00
Sale of Stock, Price Per Share (in Dollars per share)		$ 220
Preferred Stock, Value, Issued			2,000,000
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs			202,000
Series C Preferred Stock [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Preferred Stock, Shares Issued (in Shares)			3,424.65	3,424.65
Sale of Stock, Price Per Share (in Dollars per share)				$ 146.00
Preferred Stock, Value, Issued			457,000
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs			43,000
Proceeds from Issuance of Preferred Stock and Preference Stock				500,000
Series D Preferred Stock [Member] | SPA [Member] | Unallocated [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Proceeds from Issuance of Convertible Preferred Stock					817,000
Series D Preferred Stock [Member] | SPA [Member] | Allocated [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Proceeds from Issuance of Convertible Preferred Stock					498,000
Proceeds from Issuance of Common Stock					360,000
Debt Instrument, Convertible, Conversion Price (in Dollars per share)					$ 0.97
Series D Preferred Stock [Member] | SPA [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Debt Issuance Cost					41,000
Series D Preferred Stock [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Preferred Stock, Shares Issued (in Shares)			5,111.86		5,111.86
Proceeds from Issuance of Convertible Preferred Stock					858,000
Debt Instrument, Convertible, Beneficial Conversion Feature					$ 238,000
New Warrant [Member] | Alara Capital AVI II, LLC [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares)						194,437	898,634
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)						$ 1.76	$ 1.78
New Warrant [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares)					511,186
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)					$ 1.43
Alara Capital AVI II, LLC [Member]
Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares)								1,017,405
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)								$ 1.43

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Note 11 - Commitments and Contingencies (Details) - Future Minimum Lease Payments Under Capital Leases (USD $) In Thousands, unless otherwise specified	Mar. 28, 2015
Note 11 - Commitments and Contingencies (Details) - Future Minimum Lease Payments Under Capital Leases [Line Items]
2016	$ 83
2017	26
2018	26
2019	20
2020	3
Total	158
Principal [Member]
Note 11 - Commitments and Contingencies (Details) - Future Minimum Lease Payments Under Capital Leases [Line Items]
2016	69
2017	17
2018	20
2019	18
2020	3
Total	127
Interest [Member]
Note 11 - Commitments and Contingencies (Details) - Future Minimum Lease Payments Under Capital Leases [Line Items]
2016	14
2017	9
2018	6
2019	2
Total	$ 31

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Note 7 - Significant Customer and Industry Segment Information (Details) - Segment Reporting Information (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Segment Reporting Information [Line Items]
Revenue	$ 18,452	$ 13,309
Other expense	(1,386)
Interest expense, net	(406)	(106)
Depreciation and amortization	311	284
Capital expenditures	81	482
Income/(Loss) before income taxes	(1,626)	(3,740)
Assets	8,054	7,593
Gigatronics [Member]
Segment Reporting Information [Line Items]
Revenue	9,123	7,290
Other expense	(1,386)
Interest expense, net	(254)	(106)
Depreciation and amortization	277	251
Capital expenditures	81	482
Income/(Loss) before income taxes	(6,110)	(3,531)
Assets	6,103	5,442
Microsource [Member]
Segment Reporting Information [Line Items]
Revenue	9,329	6,019
Depreciation and amortization	34	33
Income/(Loss) before income taxes	4,484	(209)
Assets	$ 1,951	$ 2,151

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Note 1 - Summary of Significant Accounting Policies

12 Months Ended

Mar. 28, 2015

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

1     Summary of Significant Accounting Policies

The Company The accompanying consolidated financial statements include the accounts of Giga-tronics Incorporated (“Giga-tronics”) and its wholly-owned subsidiary, Microsource Incorporated (“Microsource”), collectively the “Company”. The Company’s corporate office and manufacturing facilities are located in San Ramon, California. Giga-tronics and its subsidiary company design, manufacture and market a broad line of test and measurement equipment used in the development, test, and maintenance of wireless communications products and systems, flight navigational equipment, electronic defense systems, and automatic testing systems. The Company also manufactures and markets a line of test, measurement, and handling equipment used in the manufacturing of semiconductor devices. The Company’s products are sold worldwide to customers in the test and measurement and semiconductor industries. The Company currently has no foreign-based operations or material amounts of identifiable assets in foreign countries. Its gross margins on foreign and domestic sales are similar, and all non-U.S. sales are transacted in U.S. dollars.

Principles of Consolidation The consolidated financial statements include the accounts of Giga-tronics and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.

Basis of Presentation The consolidated financial statements are presented on the assumption that the company will continue to operate as a going concern. Discussion of recent events that Management believes support this presentation are as follows:

In fiscal 2012 the Company began to invest heavily in the development of a new Giga-tronics Division product platform, the Advanced Signal Generation System. Delays in completing the Advanced Signal Generation System have contributed significantly to the losses of the Company. In fiscal 2015 the Company’s net loss was $1.7 million, which included a non-cash expense of $1.2 million related to the issuance of new warrants to Alara Capital and $152,000 of non-cash accretion of loan and warrant debt discounts. Also in fiscal 2015 the Company had operating income of $14,000, compared to an operating loss of $4.5 million in fiscal 2014.

In the fourth quarter of fiscal 2015 the Company received $1.5 million of net proceeds associated with Alara Capital exercising 1,002,818 of existing warrants (see Note 17, Exercise of Series C and Series D Warrants). Also in the fourth quarter of fiscal 2015 two customers formally accepted initial units of the Company’s new Advanced Signal Generation System. With initial customer acceptance of Advanced Signal Generation System units, similar units of the new platform are in production for potential future sales to customers. The Company could experience longer than anticipated sales cycles or delays in production and shipping volume quantities of the Advanced Signal Generation System, however, the Company believes the Advanced Signal Generation System will significantly contribute to the Company’s long term success. On June 1, 2015 the Company entered into a two year $2.5 million Revolving Accounts Receivable Line of Credit agreement with Bridge Bank. The Bridge Bank credit facility replaced the line of credit with SVB, which expired April 15, 2015. The $2.5 million credit facility includes $500,000 on a non-formula basis in addition to the Borrowing Base. (see Note 18, Subsequent Events).

Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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. Actual results could differ from those estimates.

Fiscal Year The Company’s financial reporting year consists of either a 52 week or 53 week period ending on the last Saturday of the month of March. Fiscal year 2015, ended on March 28, 2015 resulting in a 52 week year. Fiscal year 2014, ended on March 29, 2014 also resulting in a 52 week year. All references to years in the consolidated financial statements relate to fiscal years rather than calendar years.

Reclassifications   Certain reclassifications, none of which affected the prior year’s net loss or shareholders’ equity, have been made to prior year balances in order to conform to the current year presentation.

Revenue Recognition and Deferred Revenue   The Company records revenue when there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed and determinable, and collectability is reasonably assured. This occurs when products are shipped or the customer accepts title transfer. If the arrangement involves acceptance terms, the Company defers revenue until product acceptance is received. On certain large development contracts, revenue is recognized upon achievement of substantive milestones. Determining whether a milestone is substantive is a matter of judgment and that assessment is performed only at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

a. It is commensurate with either of the following:

1. The Company’s performance to achieve the milestone.

2. The enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the Company's performance to achieve the milestone.

b. It relates solely to past performance.

c. It is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

Milestones for revenue recognition are agreed upon with the customer prior to the start of the contract and some milestones are based on product shipping while others are based on design review. In fiscal 2015 the Company’s Microsource business unit received a $6.5 million order from a major aerospace company for non-recurring engineering services to develop a variant of its high performance fast tuning YIG filters for an aircraft platform and to deliver a limited number of flight-qualified prototype hardware units (the “NRE Order”) which is being accounted for on a milestone basis. The Company considered factors such as estimated completion dates and product acceptance of the order prior to accounting for the NRE Order as milestone revenue. During the fiscal years ended March 28, 2015 and March 29, 2014, revenue recognized on a milestone basis were $4.7 million and $486,000, respectively.

On certain contracts with several of the Company’s significant customers the Company receives payments in advance of manufacturing. Advanced payments are recorded as deferred revenue until the revenue recognition criteria described above has been met.

Accounts receivable are stated at their net realizable value. The Company has estimated an allowance for uncollectable accounts based on analysis of specifically identified accounts, outstanding receivables, consideration of the age of those receivables, the Company’s historical collection experience, and adjustments for other factors management believes are necessary based on perceived credit risk.

The activity in the reserve account for doubtful accounts is as follows for the years ending March 28, 2015 and March 29, 2014:

(Dollars in thousands)	March 28, 2015		March 29, 2014
Beginning balance	$	44	$	35
Provisions (reversals of previous provisions) for doubtful accounts		1		22
Write-off of doubtful accounts		—		(13	)
Ending balance	$	45	$	44

Accrued Warranty The Company’s warranty policy generally provides one to three years of coverage depending on the product. The Company records a liability for estimated warranty obligations at the date products are sold. The estimated cost of warranty coverage is based on the Company’s actual historical experience with its current products or similar products. For new products, the required reserve is based on historical experience of similar products until such time as sufficient historical data has been collected on the new product. Adjustments are made as new information becomes available.

Inventories Inventories are stated at the lower of cost or fair value using full absorption and standard costing. Cost is determined on a first-in, first-out basis. Standard costing and overhead allocation rates are reviewed by management periodically, but not less than annually. Overhead rates are recorded to inventory based on capacity management expects for the period the inventory will be held. Reserves are recorded within cost of sales for impaired or obsolete inventory when the cost of inventory exceeds its estimated fair value. Management evaluates the need for inventory reserves based on its estimate of the amount realizable through projected sales including an evaluation of whether a product is reaching the end of its life cycle. When inventory is discarded it is written off against the inventory reserve, as inventory generally has already been fully reserved for at the time it is discarded.

Research and Development Research and development expenditures, which include the cost of materials consumed in research and development activities, salaries, wages and other costs of personnel engaged in research and development, costs of services performed by others for research and development on the Company’s behalf and indirect costs are expensed as operating expenses when incurred. Research and development costs totaled approximately $3.2 million and $3.9 million for the years ended March 28, 2015 and March 29, 2014, respectively.

Property and Equipment   Property and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the respective assets, which range from three to ten years for machinery and equipment and office fixtures. Leasehold improvements and assets acquired under capital leases are amortized using the straight-line method over the shorter of the estimated useful lives of the respective assets or the lease term.

The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such review indicates that the carrying amount of an asset exceeds the sum of its expected future cash flows on an undiscounted basis, the asset’s carrying amount would be written down to fair value. Additionally, the Company reports long-lived assets to be disposed of at the lower of carrying amount or fair value less cost to sell. As of March 28, 2015 and March 29, 2014, management believes there has been no impairment of the Company’s long-lived assets.

Derivatives The Company accounts for free standing derivatives and embedded derivatives required to be bifurcated and accounted for on a stand-alone basis at estimated fair value. Changes in fair value are reported in earnings as other income or loss.

Deferred Rent Rent expense is recognized in an amount equal to the guaranteed base rent plus contractual future minimum rental increases amortized on the straight-line basis over the terms of the leases, including free rent periods.

Income Taxes Income taxes are accounted for using the asset and liability method.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  Future tax benefits are subject to a valuation allowance when management is unable to conclude that its deferred tax assets will more likely than not be realized.  The ultimate realization of deferred tax assets is dependent upon generation of future taxable income during the periods in which those temporary differences become deductible.  Management considers both positive and negative evidence and tax planning strategies in making this assessment.

The Company considers all tax positions recognized in its financial statements for the likelihood of realization.  When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the positions taken or the amounts of the positions that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority.  The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above, if any, would be reflected as unrecognized tax benefits, as applicable, in the accompanying consolidated balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination.  The Company recognizes accrued interest and penalties, if any, related to unrecognized tax benefits as a component of the provision for income taxes in the consolidated statements of operations.

Product Development Costs The Company incurs pre-production costs on certain long-term supply arrangements. The costs, which represent non-recurring engineering and tooling costs, are capitalized as other assets and amortized over their useful life when reimbursable by the customer. All other product development costs are charged to operations as incurred. Capitalized pre-production costs included in inventory were immaterial as of March 28, 2015 and March 29, 2014.

Software Development Costs Development costs included in the research and development of new products and enhancements to existing products are expensed as incurred, until technological feasibility in the form of a working model has been established. To date, completion of software development has been concurrent with the establishment of technological feasibility, and accordingly, no costs have been capitalized.

Share-based Compensation The Company has established the 2005 Equity Incentive Plan, which provides for the granting of options for up to 2,250,000 shares of Common Stock. In 2014, the term of the 2005 Equity Incentive Plan was extended to 2025. The Company records share-based compensation expense for the fair value of all stock options and restricted stock that are ultimately expected to vest as the requisite service is rendered.

The cash flows resulting from the tax benefits resulting from tax deductions in excess of the compensation cost recognized for those options (excess tax benefits) are classified as cash flows from financing in the statements of cash flows. These excess tax benefits were not significant for the Company for the fiscal years ended March 28, 2015 or March 29, 2014.

In calculating compensation related to stock option grants, the fair value of each stock option is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. The computation of expected volatility used in the Black-Scholes-Merton option-pricing model is based on the historical volatility of Giga-tronics’ share price. The expected term is estimated based on a review of historical employee exercise behavior with respect to option grants. The risk free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. Expected dividend yield was not considered in the option pricing formula since the Company has not paid dividends and has no current plans to do so in the future.

The fair value of restricted stock awards is based on the fair value of the underlying shares at the date of the grant. Management makes estimates regarding pre-vesting forfeitures that will impact timing of compensation expense recognized for stock option and restricted stock awards.

Earnings or Loss Per Common Share Basic earnings or loss per common share is computed using the weighted average number of common shares outstanding during the period. Diluted earnings per share incorporate the incremental shares issuable upon the assumed exercise of stock options and warrants using the treasury stock method. Anti-dilutive options are not included in the computation of diluted earnings per share. Non-vested shares of restricted stock have nonforfeitable dividend rights and are considered participating securities for the purpose of calculating basic and diluted earnings per share under the two-class method.

Comprehensive Income or Loss   There are no items of comprehensive income or loss other than net income or loss.

Financial Instruments and Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk consist of cash, cash-equivalents and trade accounts receivable. The Company’s cash-equivalents consist of overnight deposits with federally insured financial institutions. Concentration of credit risk in trade accounts receivable results primarily from sales to major customers. The Company individually evaluates the creditworthiness of its customers and generally does not require collateral or other security. At March 28, 2015, and March 29, 2014, three customers combined accounted for 65% of consolidated gross accounts receivable.

Fair Value of Financial Instruments and Fair Value Measurements   The Company’s financial instruments consist principally of cash and cash-equivalents, line of credit, term debt, warrant liability and warrant derivative liability. The fair value of a financial instrument is the amount at which the instrument could be exchanged in an orderly transaction between market participants to sell the asset or transfer the liability. The Company uses fair value measurements based on quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity can access as of the measurement date (Level 1), significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data (Level 2), or significant unobservable inputs reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability (Level 3), depending on the nature of the item being valued.

The carrying amounts of the Company’s cash and cash-equivalents and line of credit approximate their fair values at each balance sheet date due to the short-term maturity of these financial instruments. The fair values of term debt and warrant debt are based on the present value of expected future cash flows and assumptions about current interest rates and the creditworthiness of the Company (Level 3). At March 28, 2015 the carrying amounts of the Company’s term debt and warrant debt totaled $1.1 million and $82,000, respectively. At March 28, 2015 the estimated fair values of the Company’s term debt and warrant debt totaled $1.2 million and $112,000, respectively. At March 29, 2014, the carrying amounts of the Company’s term debt and warrant debt totaled $822,000 and $50,000, respectively, and the carrying amounts approximated fair value since the agreement was entered into near the balance sheet date. The fair value of the bifurcated conversion feature represented by the warrant derivative liability which is measured at fair value on a recurring basis is based on a Black Scholes option pricing model with assumptions for stock price, exercise price, volatility, expected term, risk free interest rate and dividend yield similar to those described previously for share-based compensation which were generally observable (Level 2). The Company had no assets or liabilities measured at fair value on a non-recurring basis, nor were there any transfers between Level 1 and Level 2 of the fair value hierarchy.

Recently Issued Accounting Standards

In April 2014, the Financial Accounting Standards Board (FASB) issued an accounting standard update that changes the criteria for reporting discontinued operations. Under the accounting standard update, a disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has, or will have, a major effect on an entity’s operations and financial results when either it qualifies as held for sale, disposed of by sale, or disposed of other than by sale. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2016. The Company is currently evaluating the impact of this accounting standard update on its Consolidated Financial Statements.

In May 2014, the FASB amended the accounting standards by creating a new Topic 606 which is in response to a joint initiative of the FASB and the International Accounting Standards Board to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. generally accepted accounting principles and international financial reporting standards that would:

1. Remove inconsistencies and weaknesses in revenue requirements.

2. Provide a more robust framework for addressing revenue issues.

3. Improve comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets.

4. Provide more useful information to users of financial statements through improved disclosure requirements.

5. Simplify the preparation of financial statements by reducing the number of requirements to which an entity must refer.

For a public entity, the amendments in this Update are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early application is not permitted. The Company is currently evaluating the impact this new accounting standard will have on its financial statements.

In June 2014, the FASB amended ASC 718, Share Based Compensation, to require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. For all entities, the amendments in this update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The Company is currently evaluating the impact this accounting standard update may have on its financial statements.    

In August 2014, the FASB issued ASU 2014-15 which provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity’s ability to continue as a going concern. The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The Company is currently evaluating the impact this accounting standard update may have on its financial statements.

In April 2015, the FASB issued ASU 2015-03, “Interest - Imputation of Interest (Subtopic 835-30) – Simplifying the Presentation of Debt Issuance Costs,” or ASU 2015-03. ASU 2015-03 simplifies the presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct reduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by this ASU. The amendments in this ASU are effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The adoption of this ASU by the Company will change the presentation of debt issuance costs, which will be reported as a direct offset to the applicable debt on the balance sheet.

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Note 12 - Warranty Obligations (Details) - Reconciliation of Company's Estimated Warranty Obligations (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Reconciliation of Company's Estimated Warranty Obligations [Abstract]
Balance at beginning of year	$ 61	$ 114
Provision, net	81	(5)
Warranty costs incurred	(66)	(48)
Balance at end of year	$ 76	$ 61

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Note 4 - Property, Plant and Equipment, Net (Details) - Property, Plant and Equipment (USD $) In Thousands, unless otherwise specified	Mar. 28, 2015	Mar. 29, 2014
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	$ 5,241	$ 5,130
Less: accumulated depreciation and amortization	(4,523)	(4,181)
Total	718	949
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	327	327
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	4,130	3,863
Computer Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	459	388
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross	325	325
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, plant, and equipment, gross		$ 227

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Note 3 - Inventories (Tables)

12 Months Ended

Mar. 28, 2015

Inventory Disclosure [Abstract]

Schedule of Inventory, Current [Table Text Block]

(Dollars in thousands)	March 28, 2015		March 29, 2014
Raw materials	$	1,631	$	1,501
Work-in-progress		1,598		1,400
Finished goods		15		353
Demonstration inventory		121		67
Total	$	3,365	$	3,321

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Note 1 - Summary of Significant Accounting Policies (Tables)

12 Months Ended

Mar. 28, 2015

Accounting Policies [Abstract]

Allowance for Credit Losses on Financing Receivables [Table Text Block]

(Dollars in thousands)	March 28, 2015		March 29, 2014
Beginning balance	$	44	$	35
Provisions (reversals of previous provisions) for doubtful accounts		1		22
Write-off of doubtful accounts		—		(13	)
Ending balance	$	45	$	44

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Note 10 - Share-based Compensation and Employee Benefit Plans (Details) - Weighted Average Assumptions	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Weighted Average Assumptions [Abstract]
Dividend yield	0.00%	0.00%
Expected volatility	92.00%	86.00%
Risk-free interest rate	1.61%	1.02%
Expected term (years)	8 years 124 days	7 years 332 days

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Note 5 - Gain on Sale of Product Line (Details) (USD $)	12 Months Ended
	Mar. 29, 2014	Mar. 18, 2013
Discontinued Operations and Disposal Groups [Abstract]
Nontrade Receivables, Current		$ 1,000,000
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax	$ 913,000

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Note 4 - Property, Plant and Equipment, Net (Tables)

12 Months Ended

Mar. 28, 2015

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment [Table Text Block]

(Dollars in thousands)	March 28, 2015			March 29, 2014
Leasehold improvements	$	327			327
Machinery and equipment		4,130			3,863
Computer and software		459			388
Furniture and office equipment		325			325
Construction in progress		—			227
		5,241			5,130
Less: accumulated depreciation and amortization		(4,523	)		(4,181	)
Total	$	718		$	949

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Note 7 - Significant Customer and Industry Segment Information (Tables)

12 Months Ended

Mar. 28, 2015

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

March 28, 2015 (Dollars in thousands)	Giga-tronics Division			Microsource		Total
Revenue	$	9,123		$	9,329	$	18,452
Other expense		(1,386	)		—		(1,386	)
Interest expense, net		(254	)		—		(254	)
Depreciation and amortization		277			34		311
Capital expenditures		81			—		81
Income/(Loss) before income taxes		(6,110	)		4,484		(1,626	)
Assets		6,103			1,951		8,054

March 29, 2014 (Dollars in thousands)	Giga-tronics Division			Microsource			Total
Revenue	$	7,290		$	6,019		$	13,309
Interest expense, net		(106	)		—			(106	)
Depreciation and amortization		251			33			284
Capital expenditures		482			—			482
Loss before income taxes		(3,531	)		(209	)		(3,740	)
Assets		5,442			2,151			7,593

Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block]

(Dollars in thousands)	March 28, 2015		March 29, 2014
Americas	$	26	$	169
Europe		179		661
Asia		1,085		507
Rest of world		177		140
Total	$	1,467	$	1,477

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Consolidated Statements of Cash Flows (Parentheticals) (USD $)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Issuance costs	$ 0	$ 41,000
Preferred stock, issuance costs	0	41,000
Series C and D Warrants [Member]
Issuance costs	42,000
Preferred stock, issuance costs	$ 42,000

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Note 8 - Loss Per Share (Tables)

12 Months Ended

Mar. 28, 2015

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

(In thousands except per-share data)	March 28, 2015			March 29, 2014
Net loss	$	(1,673	)	$	(3,742	)
Weighted average:
Common shares outstanding		5,279			5,058
Potential common shares		—			—
Common shares assuming dilution		5,279			5,058
Loss per common share – basic	$	(0.32	)	$	(0.74	)
Loss per common share – diluted	$	(0.32	)	$	(0.74	)
Stock options not included in computation that could potentially dilute EPS in the future		1,727			1,739
Restricted stock awards not included in computation that could potentially dilute EPS in the future		482			122
Convertible preferred stock not included in computation that could potentially dilute EPS in the future		1,853			1,853
Warrants not included in computation that could potentially dilute EPS in the future		1,368			1,317

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Note 1 - Summary of Significant Accounting Policies (Details) - Activity in the Reserve Account (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Activity in the Reserve Account [Abstract]
Beginning balance	$ 44	$ 35
Provisions (reversals of previous provisions) for doubtful accounts	1	22
Write-off of doubtful accounts		(13)
Ending balance	$ 45	$ 44

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Note 9 - Income Taxes (Details) - Effective Income Tax Reconciliation (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Effective Income Tax Reconciliation [Abstract]
Statutory federal income tax (benefit)	$ (553)	$ (1,256)
Statutory federal income tax (benefit)	34.00%	34.00%
Valuation allowance	(624)	(681)
Valuation allowance	38.40%	(18.40%)
State income tax, net of federal benefit	(95)	(216)
State income tax, net of federal benefit	5.80%	5.80%
Net operating loss expiration	861
Net operating loss expiration	(53.00%)
Non tax-deductible expenses	593	132
Non tax-deductible expenses	(36.50%)	(3.60%)
Tax credits	(187)	2,238
Tax credits	11.50%	(60.60%)
Liability for uncertain tax positions	23	1,579
Liability for uncertain tax positions	(1.40%)	42.80%
Other	29	2
Other	(1.80%)	(0.10%)
Effective income tax	$ 47	$ 2
Effective income tax	3.00%	(0.10%)

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Consolidated Balance Sheets (USD $)	Mar. 28, 2015	Mar. 29, 2014
Assets
Cash and cash-equivalents	$ 1,170,000	$ 1,059,000
Trade accounts receivable, net of allowance of $45 and $44, respectively	2,354,000	1,846,000
Inventories, net	3,365,000	3,321,000
Prepaid expenses and other current assets	373,000	349,000
Total current assets	7,262,000	6,575,000
Property and equipment, net	718,000	949,000
Other long term assets	74,000	69,000
Total assets	8,054,000	7,593,000
Liabilities and shareholders' equity
Line of credit		1,165,000
Current portion of long term debt	811,000	200,000
Accounts payable	973,000	1,430,000
Accrued payroll and benefits	678,000	755,000
Deferred revenue	1,127,000	1,329,000
Deferred rent	127,000	104,000
Capital lease obligations	69,000	147,000
Other current liabilities	501,000	472,000
Total current liabilities	4,286,000	5,602,000
Long term loan and warrant debt, net of discounts	392,000	672,000
Derivative liability, at estimated fair value	252,000	128,000
Long term obligations - deferred rent	111,000	237,000
Long term obligations - capital lease	58,000	77,000
Total liabilities	5,099,000	6,716,000
Commitments and contingencies
Convertible preferred stock of no par value; Authorized - 1,000,000 shares
Common stock of no par value; Authorized - 40,000,000 shares; 6,706,065 shares at March 28, 2015 and 5,181,247 at March 29, 2014 issued and outstanding	19,975,000	16,224,000
Accumulated deficit	(19,931,000)	(18,258,000)
Total shareholders' equity	2,955,000	877,000
Total liabilities and shareholders' equity	8,054,000	7,593,000
Series B, C, and D Preferred Stock [Member]
Convertible preferred stock of no par value; Authorized - 1,000,000 shares
Preferred Stock, Value Issued	$ 2,911,000	$ 2,911,000

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Note 6 - Selling and Advertising Expenses (Details) (USD $)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Disclosure Text Block [Abstract]
Sales Commissions and Fees	$ 237,000	$ 196,000
Advertising Expense	$ 7,000	$ 14,000

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Consolidated Statements of Shareholders Equity (Parentheticals) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Mar. 29, 2014
Series D preferred stock offering costs	$ 41

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Note 11 - Commitments and Contingencies (Details) (USD $)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014	May 31, 2013 sqft
Note 11 - Commitments and Contingencies (Details) [Line Items]
Operating Leases, Rent Expense	$ 654,000	$ 630,000
Capital Leases, Balance Sheet, Assets by Major Class, Net	319,000	456,000
Capital Leases, Lessee Balance Sheet, Assets by Major Class, Accumulated Depreciation	60,000	91,000
Long-term Purchase Commitment, Amount	$ 1,600,000
San Ramon [Member]
Note 11 - Commitments and Contingencies (Details) [Line Items]
Area of Real Estate Property (in Square Feet)	47,300
Santa Rosa [Member]
Note 11 - Commitments and Contingencies (Details) [Line Items]
Area of Real Estate Property (in Square Feet)			33,400

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Note 11 - Commitments and Contingencies (Tables)

12 Months Ended

Mar. 28, 2015

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

Fiscal year (Dollars in thousands)
2016		758
2017		523
2018		—
2019		—
Thereafter		—
Total	$	1,281

Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block]

Fiscal year (Dollars in thousands)	Principal		Interest		Total
2016	$	69	$	14	$	83
2017		17		9		26
2018		20		6		26
2019		18		2		20
2020		3		—		3
Total	$	127	$	31	$	158

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Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) (USD $)	12 Months Ended		0 Months Ended			3 Months Ended
	Mar. 28, 2015	Mar. 29, 2014	Jun. 01, 2015	Mar. 14, 2014	Mar. 13, 2014	Dec. 27, 2014	Jun. 16, 2014	Jun. 15, 2014	Jun. 11, 2013
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Proceeds from Issuance of Debt	$ 500,000	$ 1,000,000
Repayments of Lines of Credit	9,789,000	5,609,000
Proceeds from Lines of Credit	8,624,000	5,917,000
Amortization of Debt Discount (Premium)	152,000	0
Common Stock [Member] | Subsequent Event [Member] | Second Amendment [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Class of Warrant or Right, Cancelled During Period (in Shares)			40,000
Common Stock [Member] | Under First Draw [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Class of Warrant or Right, Outstanding (in Shares)				180,000
Class of Warrant or Right, Exchanged for Cash, Amount				150,000
Common Stock [Member] | Amendment [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Class of Warrant or Right, Outstanding (in Shares)				80,000
Class of Warrant or Right, Exchanged for Cash, Amount				67,000
Common Stock [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in Shares)				300,000
Class of Warrant or Right, Term				5 years
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)				$ 1.42
Subsequent Event [Member] | PFG Loan [Member] | Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Line of Credit Facility Borrowing Capacity Cancelled			500,000
Achievement of Performance Milestones First Half of Fiscal 2015 [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Line of Credit Facility, Remaining Borrowing Capacity				1,000,000
Debt Instrument Performance Milestone Net Sales					7,500,000
Under First Draw [Member] | PFG Loan [Member] | Prepaid Expenses and Other Current Assets [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Debt Issuance Cost				30,000
Under First Draw [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Long-term Debt, Gross				822,000
Debt Instrument, Convertible, Beneficial Conversion Feature				128,000
Debt Instrument, Unamortized Discount				178,000
Under First Draw [Member] | Warrant Debt [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Long-term Debt, Gross				178,000
Debt Instrument, Convertible, Beneficial Conversion Feature				50,000
Derivative Liability, Fair Value, Gross Liability	174,000	128,000
Debt Instrument, Unamortized Discount				100,000
Amendment [Member] | PFG Loan [Member] | Prepaid Expenses and Other Current Assets [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Debt Issuance Cost				15,000
Amendment [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Long-term Debt, Gross				365,000
Debt Instrument, Convertible, Beneficial Conversion Feature				123,000
Derivative Liability, Fair Value, Gross Liability		0
Debt Instrument, Unamortized Discount				135,000
Amendment [Member] | Warrant Debt [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Long-term Debt, Gross				135,000
Debt Instrument, Convertible, Beneficial Conversion Feature				12,000
Derivative Liability, Fair Value, Gross Liability	78,000
Debt Instrument, Unamortized Discount				55,000
PFG Loan [Member] | Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Line of Credit Facility, Remaining Borrowing Capacity							500,000	1,000,000
Line of Credit Facility, Maximum Borrowing Capacity							500,000
PFG Loan [Member] | Secured Debt [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Long-term Debt, Gross	1,000,000
PFG Loan [Member] | Minimum [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Debt Instrument Performance Milestones Net Income						0
PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Debt Instrument, Term					3 years
Debt Instrument, Face Amount					2,000,000
Proceeds from Issuance of Debt				1,000,000
Debt Instrument, Interest Rate, Stated Percentage	9.75%
Long-term Debt	800,000
Fair Value Adjustment of Warrants	0	0
Warrant Debt [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Derivative Liability, Fair Value, Gross Liability	252,000
Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity							500,000
Debt Instrument, Interest Rate, Stated Percentage	12.50%
Repayments of Lines of Credit	500,000
Proceeds from Lines of Credit				500,000
Minimum [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Debt Instrument, Interest Rate, Stated Percentage									6.00%
Silicon Valley Bank [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 3,000,000

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Note 14 - Line of Credit

12 Months Ended

Mar. 28, 2015

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

14     Line of Credit

On June 11, 2013 the Company entered into an amendment to the Second Amended Credit Facility (the “New Amended Credit Facility”) with Silicon Valley Bank (the “Bank”). The New Amended Credit Facility amended the Second Amended Credit Facility by expanding the definition of eligible accounts, increasing the maximum limit, and extending the maturity date. The New Amended Credit Facility, which expired on April 15, 2015 and was replaced on June 1, 2015 with a $2.5 million line of credit with Bridge Bank (see Note 18, Subsequent Events), was secured by all assets of the Company and provided for a borrowing capacity equal to 80% of eligible accounts receivable (70% of eligible foreign accounts receivable) on an aggregate basis, up to a maximum $3.0 million, provided the Company maintained borrowing base eligibility, that is, a minimum of $750,000 of cash in excess of its line of credit liability.

The Second Amended Credit Facility and New Amended Credit Facility contained a collateral handling fee of one-tenth of one percent (0.10%) on outstanding financed receivables for each calendar month based upon a 360 day year. When the Company was borrowing base eligible, the collateral handling fee was not applicable. Interest accrued on the average outstanding borrowings at a floating per annum rate equal to the greater of the Prime Rate plus two percent (2.00%) or six percent (6.00%). When the Company was borrowing base eligible, any borrowings under the New Amended Credit Facility could be repaid and such repaid amounts re-borrowed until the maturity date. When the Company was not borrowing base eligible, advances were made on the New Amended Credit facility on individual accounts receivable and the Company was required to instruct its customers to remit payments to a lockbox at the Bank and when the Company was not borrowing base eligible, such payments are applied by the Bank to the line of credit to the extent monies were advanced to the Company based on such specific accounts receivable.  As of March 28, 2015, the Company was borrowing base eligible however there were no borrowings at March 28, 2015.

As of March 28, 2015, the maximum borrowing capacity under the Line of Credit was $1.8 million, of which the entire amount was available. The Bank may have terminated or suspended the Company’s right to advances under the line of credit if the Bank had determined there had been a material adverse change in the Company’s general affairs, financial forecasts or general ability to repay.

On June 16, 2014 the Company amended the term loan agreement with PFG creating a $500,000 revolving line of credit on which the Company drew $500,000. (see Note 15, Term Loan , Revolving Line of Credit and Warrants). 

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Note 12 - Warranty Obligations (Tables)

12 Months Ended

Mar. 28, 2015

Product Warranties Disclosures [Abstract]

Schedule of Product Warranty Liability [Table Text Block]

(Dollars in thousands)	March 28, 2015			March 29, 2014
Balance at beginning of year	$	61		$	114
Provision, net		81			(5	)
Warranty costs incurred		(66	)		(48	)
Balance at end of year	$	76		$	61

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Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants

12 Months Ended

Mar. 28, 2015

Disclosure Text Block Supplement [Abstract]

Preferred Stock [Text Block]

16       Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants

On November 10, 2011, the Company received $2,199,000 in cash proceeds from Alara Capital AVI II, LLC, a Delaware limited liability company (the “Investor”), an investment vehicle sponsored by Active Value Investors, LLC, under a Securities Purchase Agreement entered into on October 31, 2011. Under the terms of the Securities Purchase Agreement, the Company issued 9,997 shares of its Series B Convertible Voting Perpetual Preferred Stock (“Series B Preferred Stock”) to the Investor at a price of $220 per share. The Company has recorded $2.0 million as Series B Preferred Stock on the consolidated balance sheet which is net of stock offering costs of approximately $202,000 and represents the value attributable to both the convertible preferred stock and warrants issued to the Investor. After considering the value of the warrants, the effective conversion price of the preferred stock was greater than the common stock price on date of issue and therefore no beneficial conversion feature was present.

On February 19, 2013, the Company entered into a Securities Purchase Agreement pursuant to which it agreed to sell 3,424.65 shares of its Series C Convertible Voting Perpetual Preferred Stock (“Series C Preferred Stock”) to the Investor, for aggregate consideration of $500,000, which is approximately $146.00 per share. The Company has recorded $457,000 as Series C Preferred Stock on the consolidated balance sheet, which is net of stock offering costs of approximately $43,000. After considering the reduction in the value of the warrant, the effective conversion price of the preferred stock was greater than the common stock price on the date of issue and therefore no beneficial conversion feature was present.

On July 8, 2013 the Company received $817,000 in net cash proceeds from the Investor under a Securities Purchase Agreement. The Company sold to the Investor 5,111.86 shares of its Series D Convertible Voting Perpetual Preferred Stock (Series D Preferred Stock) and a warrant to purchase up to 511,186 additional shares of common stock at the price of $1.43 per share. The allocation of the $858,000 in gross proceeds from issuance of Series D Preferred Stock based on the relative fair values resulted in an allocation of $498,000 (which was recorded net of $41,000 of issuance costs) to Series D Preferred Stock and $360,000 to Common Stock.  In addition, because the effective conversion rate based on the $498,000 allocated to Series D Preferred Stock was $0.97 per common share which was less than the Company’s stock price on the date of issuance, a beneficial conversion feature was present at the issuance date.  The beneficial conversion feature totaled $238,000 and was recorded as a reduction of common stock and an increase to accumulated deficit. 

Each share of Series B, Series C and Series D Preferred Stock is convertible into one hundred shares of the Company’s common stock. The investor also held warrants to purchase 1,017,405 shares at an exercise price of $1.43 per share, Warrants were exercised in part in February 2015 as discussed in Note 17, Exercise of Series C and Series D Warrants.

The table below presents information for the periods ended March 28, 2015 and March 29, 2014:

Preferred Stock

As of March 28, 2015 and March 29, 2014

							Liquidation
	Designated Shares		Shares Issued		Shares Outstanding		Preference (in thousands)
Series B		10,000.00		9,997.00		9,997.00	$	2,309
Series C		3,500.00		3,424.65		3,424.65		500
Series D		6,000.00		5,111.86		5,111.86		731
Total		19,500.00		18,533.51		18,533.51	$	3,540

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Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Details) - Preferred Stock Information (USD $)	Mar. 28, 2015	Nov. 10, 2011	Feb. 19, 2013	Jul. 08, 2013
Class of Stock [Line Items]
Designated shares	19,500.00
Shares issued	18,533.51
Shares outstanding	18,533.51
Liquidation preference (in Dollars)	$ 3,540
Series B Preferred Stock [Member]
Class of Stock [Line Items]
Designated shares	10,000.00
Shares issued	9,997.00	9,997
Shares outstanding	9,997.00
Liquidation preference (in Dollars)	2,309
Series C Preferred Stock [Member]
Class of Stock [Line Items]
Designated shares	3,500.00
Shares issued	3,424.65		3,424.65
Shares outstanding	3,424.65
Liquidation preference (in Dollars)	500
Series D Preferred Stock [Member]
Class of Stock [Line Items]
Designated shares	6,000.00
Shares issued	5,111.86			5,111.86
Shares outstanding	5,111.86
Liquidation preference (in Dollars)	$ 731

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Consolidated Statements of Cash Flows (USD $)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Cash flows from operating activities:
Net loss	$ (1,673,000)	$ (3,742,000)
Warrant issuance expense	1,232,000
Depreciation and amortization	311,000	284,000
Share based compensation	827,000	494,000
Accretion of discounts on loan and warrant debt	152,000	0
Change in deferred rent	(103,000)	(81,000)
Changes in operating assets and liabilities:
Trade accounts receivable	(508,000)	(180,000)
Inventories	(44,000)	1,239,000
Prepaid expenses and other assets	(29,000)	83,000
Accounts payable	(457,000)	642,000
Accrued payroll and benefits	(77,000)	(292,000)
Deferred revenue	(202,000)	(949,000)
Other current liabilities	29,000	(33,000)
Net cash used in operating activities	(542,000)	(2,535,000)
Cash flows from investing activities:
Purchases of property and equipment	(16,000)	(228,000)
Net cash used in investing activities	(16,000)	(228,000)
Cash flows from financing activities:
Proceeds from exercise and issuance of warrants, net of issuance costs of $42	1,529,000
Proceeds from exercise of stock options	163,000	0
Payments on capital leases	(158,000)	(185,000)
Proceeds from line of credit	8,624,000	5,917,000
Proceeds from issuance of debt	500,000	1,000,000
Repayments of line of credit	(9,789,000)	(5,609,000)
Repayments of debt	(200,000)
Proceeds from issuance of preferred stock, net of issuance costs of $41		817,000
Net cash provided by financing activities	669,000	1,940,000
Increase/(Decrease) in cash and cash-equivalents	111,000	(823,000)
Beginning cash and cash-equivalents	1,059,000	1,882,000
Ending cash and cash-equivalents	1,170,000	1,059,000
Supplementary disclosure of cash flow information:
Cash paid for income taxes	2,000	2,000
Cash paid for interest	219,000	106,000
Supplementary disclosure of noncash financing activities:
Equipment acquired under capital lease	$ 61,000	$ 254,000

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Consolidated Balance Sheets (Parentheticals) (USD $)	Mar. 28, 2015	Mar. 29, 2014
Trade accounts receivable, allowance (in Dollars)	$ 45,000	$ 44,000
Preferred Stock, Shares Authorized	19,500.00
Prеfеrrеd Stock, Sharеs Issuеd	18,533.51
Preferred Stock, Shares Outstanding	18,533.51
Preferred Stock, Liquidation Preference (in Dollars)	3,540
Common stock, par value (in Dollars per share)	$ 0	$ 0
Common stock, authorized	40,000,000	40,000,000
Common stock, issued	6,706,065	5,181,247
Common stock, outstanding	6,706,065	5,181,247
Series A Preferred Stock [Member]
Preferred Stock, Shares Authorized	250,000	250,000
Prеfеrrеd Stock, Sharеs Issuеd	0	0
Preferred Stock, Shares Outstanding	0	0
Series B, C, and D Preferred Stock [Member]
Preferred Stock, Shares Authorized	19,500	19,500
Prеfеrrеd Stock, Sharеs Issuеd	18,533.51	18,533.51
Preferred Stock, Shares Outstanding	18,533.51	18,533.51
Preferred Stock, Liquidation Preference (in Dollars)	$ 3,540,000	$ 3,540,000

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Note 9 - Income Taxes

12 Months Ended

Mar. 28, 2015

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

9     Income Taxes

Following are the components of the provision for income taxes:

Fiscal years ended (In thousands)	March 28, 2015			March 29, 2014
Current
Federal	$	—		$	—
State		47			2
Total current		47			2
Deferred
Federal		210			(568	)
State		391			(330	)
Total deferred		601			(898	)
Change in liability for uncertain tax positions		23			1,579
Change in valuation allowance		(624	)		(681	)
Provision for income taxes	$	47		$	2

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets are as follows:

Fiscal years ended (In thousands)	March 28, 2015			March 29, 2014
Net operating loss carryforwards	$	13,657		$	14,300
Income tax credits		306			143
Inventory reserves and additional costs capitalized		1,974			2,051
Accrued vacation		133			129
Deferred rent		95			136
Non-qualified stock options and restricted stock		247			211
Other		48			114
Total deferred tax assets		16,460			17,084
Valuation allowance		(16,460	)		(17,084	)
Net deferred tax assets	$	—		$	—

The following summarizes the difference between the income tax expense and the amount computed by applying the statutory federal income tax rate of 34% to income before income tax. The items comprising these differences consisted of the following for the fiscal years ended March 28, 2015 and March 29, 2014:

Fiscal years ended (In thousands except percentages)	March 28, 2015					March 29, 2014
Statutory federal income tax (benefit)	$	(553	)	34	%	$	(1,256	)	34	%
Valuation allowance		(624	)	38.4			681		(18.4	)
State income tax, net of federal benefit		(95	)	5.8			(216	)	5.8
Net operating loss expiration		861		(53.0	)		—		—
Non tax-deductible expenses		593		(36.5	)		132		(3.6	)
Tax credits		(187	)	11.5			2,238		(60.6	)
Liability for uncertain tax positions		23		(1.4	)		(1,579	)	42.8
Other		29		(1.8	)		2		(0.1	)
Effective income tax	$	47		3.0	%	$	2		(0.1	)%

The decrease in valuation allowance from March 29, 2014 to March 28, 2015 was $624,000.

As of March 28, 2015, the Company had pre-tax federal net operating loss carryforwards of $35.9 million and state net operating loss carryforwards of $25.0 million available to reduce future taxable income. The federal and state net operating loss carryforwards begin to expire from fiscal 2023 through 2035 and from 2015 through 2035, respectively. Utilization of net operating loss carryforwards may be subject to annual limitations due to certain ownership change limitations as required by Internal Revenue Code Section 382. The federal income tax credits begin to expire from 2021 through 2035 and state income tax credit carryforwards are carried forward indefinitely.

The Company has recorded a valuation allowance to reflect the estimated amount of deferred tax assets, which may not be realized. The ultimate realization of deferred tax assets is dependent upon generation of future taxable income during the periods in which those temporary differences become deductible. Management considers both positive and negative evidence and tax planning strategies in making this assessment.

As of March 28, 2015, the Company recorded unrecognized tax benefits of $93,000 related to uncertain tax positions. The unrecognized tax benefit is netted against the noncurrent deferred tax asset on the Consolidated Balance Sheet. The Company has not recorded a liability for any penalties or interest related to the unrecognized tax benefits.

The Company files U.S federal and California state income tax returns. The Company is generally no longer subject to tax examinations for years prior to the fiscal year 2012 for federal purposes and fiscal year 2011 for California purposes, except in certain limited circumstances. The Company does have a California Franchise Tax Board audit that is pending. The Company is working with the California Franchise Tax Board to resolve all audit issues and does not believe any material taxes or penalties are due. However, as a result of the ongoing examination, the Company eliminated certain income tax credit carryovers in fiscal 2014.  The write-off of these income tax credit carryovers did not have a significant impact on total income tax expense as the majority had an uncertain tax position reserve with the balance having a full valuation allowance against the deferred tax asset.

A reconciliation of the beginning and ending amount of the liability for uncertain tax positions, excluding potential interest and penalties, is as follows:

(In thousands)	Fiscal Year 2015		Fiscal Year 2014
Balance as of beginning of year	$	70	$	1,649
Additions based on current year tax positions		23		—
(Reductions) additions for prior year tax positions		—		(1,579	)
Balance as of end of year	$	93	$	70

The total amount of interest and penalties related to unrecognized tax benefits at March 28, 2015 is not material. The amount of tax benefits that would impact the effective rate, if recognized, is not expected to be material. The Company does not anticipate any significant changes with respect to unrecognized tax benefits within next twelve (12) months.

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Document And Entity Information (USD $)	12 Months Ended
	Mar. 28, 2015	Jun. 02, 2015	Sep. 27, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	GIGA TRONICS INC
Document Type	10-K
Current Fiscal Year End Date	--03-28
Entity Common Stock, Shares Outstanding		6,725,281
Entity Public Float			$ 9,731,799
Amendment Flag	false
Entity Central Index Key	0000719274
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Mar. 28, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	FY

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Note 10 - Share-based Compensation and Employee Benefit Plans

12 Months Ended

Mar. 28, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

10     Share-based Compensation and Employee Benefit Plans

Share-based Compensation The Company has established the 2000 Stock Option Plan and the 2005 Equity Incentive Plan, which provide for the granting of options and restricted stock for up to 2,250,000 shares of common stock at 100% of fair market value at the date of grant, with each grant requiring approval by the Board of Directors of the Company. Option grants under the 2000 Stock Option Plan are no longer available. Options granted generally vest in one or more installments in a four or five year period and must be exercised while the grantee is employed by the Company or within a certain period after termination of employment. Options granted to employees shall not have terms in excess of 10 years from the grant date. Holders of options may be granted stock appreciation rights (SAR), which entitle them to surrender outstanding options for a cash distribution under certain changes in ownership of the Company, as defined in the stock option plan. As of March 28, 2015, no SAR’s have been granted under the option plan. As of March 28, 2015, the total number of shares of common stock available for issuance is 397,425. All outstanding options have either a five year or a ten year life.

The weighted average grant date fair value of stock options granted during the fiscal years ended March 28, 2015 and March 29, 2014 was $1.66 and $1.07, respectively, and was calculated using the following weighted-average assumptions:

Fiscal years ended	March 28, 2015			March 29, 2014
Dividend yield		—			—
Expected volatility		92	%		86	%
Risk-free interest rate		1.61	%		1.02	%
Expected term (years)		8.34			7.91

A summary of the changes in stock options outstanding for the fiscal years ended March 28, 2015 and March 29, 2014 is presented below:

					Weighted Average
			Weighted Average		Remaining Contractual		Aggregate Intrinsic
(Dollars in thousands except share prices)	Shares		Exercise Price		Terms (Years)		Value
Outstanding at March 30, 2013		1,556,250	$	1.62		6.8	$	252
Granted		430,750		1.32
Exercised		—		—
Forfeited / Expired		248,250		1.72
Outstanding at March 29, 2014		1,738,750	$	1.53		6.8	$	113
Granted		306,500		2.01
Exercised		90,000		1.80
Forfeited / Expired		228,275		1.81
Outstanding at March 28, 2015		1,726,975	$	1.57		6.9	$	219
Exercisable at March 28, 2015		618,975	$	1.62		6.1	$	59
At March 28, 2015, expected to vest in the future		761,212	$	1.54		7.4	$	107

 As of March 28, 2015, there was $1.2 million of total unrecognized compensation cost related to non-vested options and restricted stock granted under the 2005 Plan and outside of the 2005 Plan. That cost is expected to be recognized over a weighted average period of 2.5 years and will be adjusted for subsequent changes in estimated forfeitures. There were 280,650 and 320,525 options vested during the fiscal years ended March 28, 2015 and March 29, 2014 respectively. The total fair value of options vested during the fiscal years ended March 28, 2015 and March 29, 2014 was $120,000 and $365,000, respectively. Cash received from the exercise of stock options during fiscal 2015 was $163,000. No cash was received from the exercise of stock options in fiscal 2014. Share based compensation cost recognized in operating results for the fiscal years ended March 28, 2015 and March 29, 2014 totaled $370,000 and $310,000, respectively.

Included in the total options outstanding at March 28, 2015 are performance-based options for 100,000 shares granted, which were granted outside of the 2005 Plan. All of the options vest following the filing of the Company’s Form 10-K for fiscal 2015 given certain bookings goals that were achieved by the Company. Compensation cost recognized in fiscal 2015 related to these options were $29,000, and no compensation cost was recognized for these stock options during fiscal 2014 because management did not believe the performance criteria would be met.

During the year ended March 29, 2014, the vesting for 40,000 options was accelerated in connection with a termination agreement with a former employee. This modification did not result in any incremental compensation expense, however $7,000 of stock-based compensation expense was accelerated and recognized during the year ended March 29, 2014.

Restricted Stock

The Company granted 432,000 shares of restricted stock during fiscal 2015 to certain members of the Board of Directors in lieu of services to be performed in fiscal 2015 and fiscal 2016. The weighted average grant date fair value was $2.11. In fiscal 2014, the Company granted 71,500 shares of restricted stock to certain members of the Board of Directors in lieu of cash compensation for services to be performed in fiscal 2014. The weighted average grant date fair value was $1.53. The Company also granted 30,000 shares of unrestricted stock during 2014 as part of a severance agreement with a former employee. The 30,000 shares did not have a restriction period because they vested immediately on the grant date, but are included in the roll forward schedule of restricted stock below because they were granted under the 2005 Plan. The Company granted 50,000 shares of restricted stock outside the 2005 Plan in fiscal 2013. The restricted stock awards are considered fixed awards as the number of shares and fair value at the grant date is amortized over the requisite service period net of estimated forfeitures. Compensation cost recognized for restricted stock awards for 2015 and 2014 totaled $457,000 and $184,000, respectively.

A summary of the changes in non-vested restricted stock awards outstanding for the fiscal years ended March 28, 2015 and March 29, 2014 is presented below:

			Weighted
			Average Grant
	Shares		Date Fair Value
Non-vested at March 30, 2013		50,000	$	1.18
Granted		101,500		1.53
Forfeited or cancelled		30,000		1.53
Non-vested at March 29, 2014		121,500	$	1.39
Granted		432,000		2.11
Vested		71,500		1.53
Forfeited or cancelled		—		—
Non-vested at March 28, 2015		482,000	$	2.02

401(k) Plans The Company has established 401(k) plans which cover substantially all employees. Participants may make voluntary contributions to the plans for up to 100% of their defined compensation. The Company matches a percentage of the participant’s contributions in accordance with the plan. Participants vest ratably in Company contributions over a four-year period. Company contributions to the plans for fiscal 2015 and 2014 were approximately $39,000 and $44,000, respectively.

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Consolidated Statements of Operations (USD $) Share data in Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Net sales	$ 18,452,000	$ 13,309,000
Cost of sales	10,445,000	8,811,000
Gross margin	8,007,000	4,498,000
Operating expenses:
Engineering	3,210,000	3,897,000
Selling, general and administrative	4,783,000	4,809,000
Restructuring	0	331,000
Total operating expenses	7,993,000	9,037,000
Operating income/(loss)	14,000	(4,539,000)
Gain on sale of product line		913,000
Warrant expense	(1,232,000)
Other loss	(2,000)	(8,000)
Interest expense:
Interest expense, net	(254,000)	(106,000)
Interest expense from accretion of loan and warrant debt discounts	(152,000)	0
Total interest expense	(406,000)	(106,000)
Loss before income taxes	(1,626,000)	(3,740,000)
Provision for income taxes	47,000	2,000
Net loss	$ (1,673,000)	$ (3,742,000)
Loss per common share – basic (in Dollars per share)	$ (0.32)	$ (0.74)
Loss per common share – diluted (in Dollars per share)	$ (0.32)	$ (0.74)
Weighted average common shares used in per share calculation:
Basic (in Shares)	5,279	5,058
Diluted (in Shares)	5,279	5,058

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Note 4 - Property, Plant and Equipment, Net

12 Months Ended

Mar. 28, 2015

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment Disclosure [Text Block]

4     Property, Plant and Equipment, net

Property, plant and equipment, net is comprised of the following:

(Dollars in thousands)	March 28, 2015			March 29, 2014
Leasehold improvements	$	327			327
Machinery and equipment		4,130			3,863
Computer and software		459			388
Furniture and office equipment		325			325
Construction in progress		—			227
		5,241			5,130
Less: accumulated depreciation and amortization		(4,523	)		(4,181	)
Total	$	718		$	949

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Note 3 - Inventories

12 Months Ended

Mar. 28, 2015

Inventory Disclosure [Abstract]

Inventory Disclosure [Text Block]

3     Inventories

Inventories, net of reserves, consisted of the following:

(Dollars in thousands)	March 28, 2015		March 29, 2014
Raw materials	$	1,631	$	1,501
Work-in-progress		1,598		1,400
Finished goods		15		353
Demonstration inventory		121		67
Total	$	3,365	$	3,321

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Note 15 - Term Loan, Revolving Line of Credit and Warrants

12 Months Ended

Mar. 28, 2015

Disclosure Text Block [Abstract]

Long-term Debt [Text Block]

15       Term Loan, Revolving Line of Credit and Warrants

On March 13, 2014 the Company entered into a three year, $2.0 million term loan agreement with PFG under which the Company received $1.0 million on March 14, 2014. Pursuant to the agreement, the Company had the ability to borrow an additional $1.0 million following the Company’s achievement of certain performance milestones which includes achieving $7.5 million in net sales during the first half of fiscal 2015 and two consecutive quarters of net income greater than zero during fiscal 2015.

On June 16, 2014, the Company amended its loan agreement with PFG (the “Amendment”). Under the terms of the Amendment, PFG made a revolving credit line available to Giga-tronics in the amount of $500,000, and the Company borrowed the entire amount on June 17, 2014. The revolving line has a thirty-three month term. The Amendment reduced the future amount potentially available for the Company to borrow under the PFG Loan agreement from $1.0 million to $500,000.

On June 3, 2015, the Company further amended its loan agreement with PFG (the “Second Amendment”). The Second Amendment cancelled the additional $500,000 that was available to the Company under the June 2014 Amendment (see Note 18, Subsequent Events).

Interest on the initial $1.0 million term loan is fixed at 9.75% and requires monthly interest only payments during the first six months of the agreement followed by monthly principal and interest payments over the remaining thirty months. The Company may prepay the loan at any time prior to maturity by paying all future scheduled principal and interest payments. As of March 28, 2015, the Company’s total outstanding debt associated with the initial PFG loan was $800,000.

Interest on the $500,000 revolving line with PFG is fixed, calculated on a daily basis at a rate of 12.50% per annum. The Company may prepay the loan at any time prior to the March 13, 2017 maturity date without a penalty. Beginning in October 2014, PFG had the right to convert the $500,000 revolving loan into a term loan and require principal payments to be amortized over the remaining loan term. On April 25, 2015, PFG exercised this right, and fully amortizing principal and interest payments are scheduled to begin in May 2015. As of March 28, 2015, the $500,000 revolving line was fully advanced.

The PFG Loan is secured by all of the assets of the Company under a lien that is junior to the SVB position described in Note 14, and limits borrowing under the SVB credit line limit to $3.0 million. The Company paid a loan fee of $30,000 upon the initial draw (“First Draw”) and $15,000 for the June 2014 Amendment. The loan fees paid are recorded as prepaid expenses and amortized to interest expense over the remaining term of the PFG amended loan agreement.

The future payments under the initial loan and all the Amendments, were as follows as of March 28, 2015.

Fiscal year (Dollars in thousands)	Principal		Interest		Total
2016	$	870		92		962
2017		430		18		448
Total	$	1,300	$	110	$	1,410

The loan agreement contains financial covenants associated with the Company achieving minimum quarterly net sales and maintaining a minimum monthly shareholders’ equity. In the event of default by the Company, all or any part of the Company’s obligation to PFG could become immediately due. As of March 28, 2015, the Company was in compliance with all the financial covenants under the agreement.

The loan agreement also provided for the issuance of warrants convertible into 300,000 shares of the Company’s common stock, of which 180,000 were exercisable upon receipt of the initial $1.0 million from the First Draw, 80,000 became exercisable with the Amendment. The Second Amendment terminated the additional 40,000 warrants that would have become exercisable as part of cancelling the remaining $500,000 that was available under the Amendment. Each warrant issued under the loan agreement has a term of five years from the First Draw and an exercise price of $1.42 which was equal to the average NASDAQ closing price of the Company’s common stock for the ten trading days prior to the First Draw.

If the warrants are not exercised before expiration on March 13, 2019, the Company would be required to pay PFG $150,000 and $67,000 as settlement for warrants associated with the First Draw and the Amendment, respectively. The warrants could be settled for cash at an earlier date in the event of any acquisition or other change in control of the Company, future public issuance of Company securities or liquidation (or substantially similar event) of the Company. The Company currently has no plans for any of the aforementioned events, and as a result, the cash payment date is estimated to be the expiration date unless warrants are exercised before then. Due to the fixed payment amount on the expiration date, the warrant structure is in substance a debt arrangement (the “Warrant Debt”) with a zero interest rate, a fixed maturity date and a feature that makes the debt convertible to common stock. The conversion feature is an embedded derivative and due to the downward adjustment feature based on performance criteria is not considered indexed solely to the Company’s stock. Thus, for accounting purposes, the conversion feature is bifurcated and accounted for separately from the host debt instrument as a derivative liability measured at fair value which resulted in an initial carrying value of $128,000 for the derivative liability associated with the warrants issued in connection with the First Draw and an initial carrying value of $123,000 for the derivative liability associated with the warrants issued in connection with the Amendment.

As of March 28, 2015, the estimated fair values of the derivative liabilities associated with the warrants issued in connection with the First Draw and Amendment were $174,000 and $78,000, respectively, for a combined value of $252,000. As of March 29, 2014, the estimated fair value of the derivative liability associated with the warrant issued in connection with the First Draw was $128,000. There was no derivative liability associated with the Amendment warrant at March 29, 2014. There was no change in the fair value of the derivative liabilities between fiscal 2015 and fiscal 2014 therefore there was no gains or losses on adjustment of derivative liability to fair value.

The proceeds from the initial $1.0 million draw were allocated between the PFG Debt and the Warrant Debt (inclusive of its conversion feature) based on their relative fair values on the date of issuance which resulted in initial carrying values of $822,000 and $178,000, respectively. The conversion feature was bifurcated from the Warrant Debt and recorded at fair value resulting in a remaining carrying value of $50,000 associated with the Warrant Debt. The resulting discounts of $178,000 on the PFG Debt and $100,000 on the Warrant Debt will be accreted to interest expense under the effective interest method over the three-year term of the PFG Debt and the five-year term of the Warrant Debt.

The proceeds from the $500,000 credit line issued in connection with the Amendment were allocated between the PFG Loan and the Warrant Debt (inclusive of its conversion feature) based on their relative fair values on the date of issuance which resulted in initial carrying values of $365,000 and $135,000, respectively. The conversion feature was bifurcated from the Warrant Debt and recorded at its $123,000 estimated fair value resulting in a remaining carrying value of $12,000 associated with the Warrant Debt. The resulting discounts of $135,000 on the PFG Loan and $55,000 on the Warrant Debt is being accreted to interest expense under the effective interest method over the thirty-three month remaining term of the PFG Loan and the fifty-seven month remaining term of the Warrant Debt. For fiscal 2015, the Company recorded accretion of discount expense associated with the warrants issued with the PFG Loan of $152,000, there was no accretion of discount expense recorded in fiscal 2014 as the loan was funded in late fiscal 2014. 

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Note 11 - Commitments and Contingencies

12 Months Ended

Mar. 28, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

11     Commitments and Contingencies

The Company leases a 47,300 square foot facility located in San Ramon, California that expires in December 31, 2016. The Company leased a 33,400 square foot facility located in Santa Rosa, California, under a lease that expired May 31, 2013. The Company did not extend the Santa Rosa lease and vacated the facility on May 31, 2013. All of the Company’s operations are in the San Ramon facility as of March 28, 2015.

The Company also leases certain other equipment under operating leases.

Total future minimum lease payments under these leases are as follows.

Fiscal year (Dollars in thousands)
2016		758
2017		523
2018		—
2019		—
Thereafter		—
Total	$	1,281

The aggregate rental expense was $654,000 and $630,000 in fiscal 2015 and 2014, respectively.

The Company leases certain equipment under capital leases that expire through May 2019. Capital leases with costs totaling $319,000 and $456,000 are reported net of accumulated depreciation of $60,000 and $91,000 at March 28, 2015 and March 29, 2014, respectively.

Total future minimum lease payments under these capital leases are as follows.

Fiscal year (Dollars in thousands)	Principal		Interest		Total
2016	$	69	$	14	$	83
2017		17		9		26
2018		20		6		26
2019		18		2		20
2020		3		—		3
Total	$	127	$	31	$	158

The Company is committed to purchase certain inventory under non-cancelable purchase orders. As of March 28, 2015, total non–cancelable purchase orders were approximately $1.6 million and are scheduled to be delivered to the Company at various dates through March 2016.

A sole distributor of certain products has made a claim for commissions in connection with prior and future sales by the company for products that the Company believes are excluded from the distribution agreement. The potential liability from the claim, if any, cannot be reasonably estimated at this time.

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Note 7 - Significant Customer and Industry Segment Information

12 Months Ended

Mar. 28, 2015

Segment Reporting [Abstract]

Segment Reporting Disclosure [Text Block]

7     Significant Customers and Industry Segment Information

The Company has two reportable segments: Giga-tronics Division and Microsource. Giga-tronics Division produces a broad line of test and measurement equipment used in the development, test and maintenance of wireless communications products and systems, flight navigational equipment, electronic defense systems and automatic testing systems and designs, manufactures, and markets a line of switching devices that link together many specific purpose instruments that comprise automatic test systems. Microsource develops and manufactures a broad line of Yttrium, Iron and Garnet (YIG) tuned oscillators, filters and microwave synthesizers, which are used in a wide variety of microwave instruments or devices.

The accounting policies for the segments are the same as those described in the "Summary of Significant Accounting Policies". The Company evaluates the performance of its segments and allocates resources to them based on earnings before income taxes. Segment net sales include sales to external customers. Inter-segment activities are eliminated in consolidation. Assets include accounts receivable, inventories, equipment, cash, deferred income taxes, prepaid expenses and other long-term assets. The Company accounts for inter-segment sales and transfers at terms that allow a reasonable profit to the seller. During the periods reported there were no significant inter-segment sales or transfers.

The Company's reportable operating segments are strategic business units that offer different products and services. They are managed separately because each business utilizes different technology and requires different accounting systems. The Company’s chief operating decision maker is considered to be the Company’s Chief Executive Officer (“CEO”). The CEO reviews financial information presented on a consolidated basis accompanied by disaggregated information about revenues and pre-tax income or loss by operating segment.

The tables below present information for the fiscal years ended in 2015 and 2014.

March 28, 2015 (Dollars in thousands)	Giga-tronics Division			Microsource		Total
Revenue	$	9,123		$	9,329	$	18,452
Other expense		(1,386	)		—		(1,386	)
Interest expense, net		(254	)		—		(254	)
Depreciation and amortization		277			34		311
Capital expenditures		81			—		81
Income/(Loss) before income taxes		(6,110	)		4,484		(1,626	)
Assets		6,103			1,951		8,054

March 29, 2014 (Dollars in thousands)	Giga-tronics Division			Microsource			Total
Revenue	$	7,290		$	6,019		$	13,309
Interest expense, net		(106	)		—			(106	)
Depreciation and amortization		251			33			284
Capital expenditures		482			—			482
Loss before income taxes		(3,531	)		(209	)		(3,740	)
Assets		5,442			2,151			7,593

The Company’s Giga-tronics Division and Microsource segments sell to agencies of the U.S. government and U.S. defense-related customers. In fiscal 2015 and 2014, U.S. government and U.S. defense-related customers accounted for 69% and 57% of sales, respectively. During fiscal 2015, one customer accounted for 28% of the Company’s consolidated revenues at March 28, 2015 and was included in the Microsource segment. A second customer accounted for 23% of the Company’s consolidated revenues at March 28, 2015 and was also included in the Microsource segment. A third customer accounted for 14% of the Company’s consolidated revenues during fiscal 2015 and was included in the Giga-tronics Division reporting segment.

During fiscal 2014, one customer accounted for 39% of the Company’s consolidated revenues at March 29, 2014 and was included in the Microsource segment. A second customer accounted for 16% of the Company’s consolidated revenues at March 29, 2014 and was included in the Giga-tronics Division.

Export sales accounted for 8% and 11% of the Company’s sales in fiscal 2015 and 2014, respectively. Export sales by geographical area for these fiscal years are shown below:

(Dollars in thousands)	March 28, 2015		March 29, 2014
Americas	$	26	$	169
Europe		179		661
Asia		1,085		507
Rest of world		177		140
Total	$	1,467	$	1,477

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Note 11 - Commitments and Contingencies (Details) - Future Minimum Lease Payments Under Operating Leases (USD $) In Thousands, unless otherwise specified	Mar. 28, 2015
Future Minimum Lease Payments Under Operating Leases [Abstract]
2016	$ 758
2017	523
2018	0
2019	0
Thereafter	0
Total	$ 1,281

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Note 5 - Gain on Sale of Product Line

12 Months Ended

Mar. 28, 2015

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

 5     Gain on Sale of Product Line

On March 18, 2013, the Company entered into an Asset Purchase Agreement with Teradyne Inc. (Teradyne), whereby Teradyne agreed to purchase the Giga-tronics Division product line known as SCPM for $1.0 million, resulting in a net gain of $913,000 during fiscal 2014.

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Note 6 - Selling and Advertising Expenses

12 Months Ended

Mar. 28, 2015

Disclosure Text Block [Abstract]

Other Operating Income and Expense [Text Block]

6     Selling and Advertising Expenses

Selling expenses consist primarily of salaries to employees and commissions paid to various sales representatives and marketing agencies. Commission expense totaled $237,000 and $196,000 for fiscal 2015 and 2014, respectively. Advertising costs, which are expensed as incurred, totaled $7,000 and $14,000 for fiscal 2015 and 2014, respectively.

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Note 8 - Loss Per Share

12 Months Ended

Mar. 28, 2015

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

8     Loss per Common Share

Net loss and common shares used in per share computations for the fiscal years ended March 28, 2015 and March 29, 2014 are as follows:

(In thousands except per-share data)	March 28, 2015			March 29, 2014
Net loss	$	(1,673	)	$	(3,742	)
Weighted average:
Common shares outstanding		5,279			5,058
Potential common shares		—			—
Common shares assuming dilution		5,279			5,058
Loss per common share – basic	$	(0.32	)	$	(0.74	)
Loss per common share – diluted	$	(0.32	)	$	(0.74	)
Stock options not included in computation that could potentially dilute EPS in the future		1,727			1,739
Restricted stock awards not included in computation that could potentially dilute EPS in the future		482			122
Convertible preferred stock not included in computation that could potentially dilute EPS in the future		1,853			1,853
Warrants not included in computation that could potentially dilute EPS in the future		1,368			1,317

The stock options, restricted stock, convertible preferred stocks and warrants not included in the computation of diluted earnings per share (EPS) for the fiscal years ended March 28, 2015 and March 29, 2014 is a result of the Company’s net loss and, therefore, the effect of these instrument would be anti-dilutive.

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Note 14 - Line of Credit (Details) (USD $)	0 Months Ended
	Jun. 01, 2015	Jun. 11, 2013	May 29, 2015	Jun. 16, 2014	Jun. 15, 2014	Mar. 28, 2015
Note 14 - Line of Credit (Details) [Line Items]
Line of Credit Facility, Collateral Fees, Percent of Outstanding Financed Receivables			0.10%
Subsequent Event [Member] | PFG Loan [Member] | Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 14 - Line of Credit (Details) [Line Items]
Long-term Line of Credit	500,000
Subsequent Event [Member] | Revolving Credit Facility [Member] | Bridge Bank [Member]
Note 14 - Line of Credit (Details) [Line Items]
Long-term Line of Credit			2,500,000
Advance Rate			80.00%
Line of Credit Facility, Maximum Borrowing Capacity			3,000,000
Line of Credit Facility, Covenant Terms, Minimum Cash Balance			750,000
Subsequent Event [Member] | New Amended Credit Facility 2 [Member] | Prime Rate [Member]
Note 14 - Line of Credit (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.50%
Subsequent Event [Member] | New Amended Credit Facility 2 [Member] | Foreign Accounts Receivable [Member]
Note 14 - Line of Credit (Details) [Line Items]
Advance Rate			70.00%
Subsequent Event [Member] | New Amended Credit Facility 2 [Member]
Note 14 - Line of Credit (Details) [Line Items]
Long-term Line of Credit	2,500,000
Advance Rate	80.00%
Line of Credit Facility, Maximum Borrowing Capacity	2,500,000
PFG Loan [Member] | Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 14 - Line of Credit (Details) [Line Items]
Long-term Line of Credit				500,000
Line of Credit Facility, Maximum Borrowing Capacity				500,000
Line of Credit Facility, Remaining Borrowing Capacity				500,000	1,000,000
PFG Loan [Member]
Note 14 - Line of Credit (Details) [Line Items]
Debt Instrument, Interest Rate, Stated Percentage						9.75%
New Amended Credit Facility [Member]
Note 14 - Line of Credit (Details) [Line Items]
Line of Credit Facility, Initiation Date		Jun. 11, 2013
Long-term Line of Credit						0
Line of Credit Facility, Maximum Borrowing Capacity						1,800,000
Line of Credit Facility, Remaining Borrowing Capacity						1,800,000
Revolving Credit Facility [Member] | Partners For Growth IV, L.P. [Member]
Note 14 - Line of Credit (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity				$ 500,000
Debt Instrument, Interest Rate, Stated Percentage						12.50%
Prime Rate [Member]
Note 14 - Line of Credit (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate		2.00%
Minimum [Member]
Note 14 - Line of Credit (Details) [Line Items]
Debt Instrument, Interest Rate, Stated Percentage		6.00%

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Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) - Future Debt Payments (USD $) In Thousands, unless otherwise specified	Mar. 28, 2015
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) - Future Debt Payments [Line Items]
2016	$ 962
2017	448
Total	1,410
Principal [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) - Future Debt Payments [Line Items]
2016	870
2017	430
Total	1,300
Interest [Member] | PFG Loan [Member]
Note 15 - Term Loan, Revolving Line of Credit and Warrants (Details) - Future Debt Payments [Line Items]
2016	92
2017	18
Total	$ 110

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Note 13 - Restructuring (Details) (USD $)	0 Months Ended	12 Months Ended
	Mar. 29, 2014	Mar. 28, 2015	Mar. 29, 2014
Restructuring and Related Activities [Abstract]
Restructuring Charges	$ 780,000	$ 0	$ 331,000

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Note 10 - Share-based Compensation and Employee Benefit Plans (Tables)

12 Months Ended

Mar. 28, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

Fiscal years ended	March 28, 2015			March 29, 2014
Dividend yield		—			—
Expected volatility		92	%		86	%
Risk-free interest rate		1.61	%		1.02	%
Expected term (years)		8.34			7.91

Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block]

					Weighted Average
			Weighted Average		Remaining Contractual		Aggregate Intrinsic
(Dollars in thousands except share prices)	Shares		Exercise Price		Terms (Years)		Value
Outstanding at March 30, 2013		1,556,250	$	1.62		6.8	$	252
Granted		430,750		1.32
Exercised		—		—
Forfeited / Expired		248,250		1.72
Outstanding at March 29, 2014		1,738,750	$	1.53		6.8	$	113
Granted		306,500		2.01
Exercised		90,000		1.80
Forfeited / Expired		228,275		1.81
Outstanding at March 28, 2015		1,726,975	$	1.57		6.9	$	219
Exercisable at March 28, 2015		618,975	$	1.62		6.1	$	59
At March 28, 2015, expected to vest in the future		761,212	$	1.54		7.4	$	107

Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block]

			Weighted
			Average Grant
	Shares		Date Fair Value
Non-vested at March 30, 2013		50,000	$	1.18
Granted		101,500		1.53
Forfeited or cancelled		30,000		1.53
Non-vested at March 29, 2014		121,500	$	1.39
Granted		432,000		2.11
Vested		71,500		1.53
Forfeited or cancelled		—		—
Non-vested at March 28, 2015		482,000	$	2.02

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Note 9 - Income Taxes (Details) - Components of the Provision for Income Taxes (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Current
Federal	$ 0	$ 0
State	47	2
Total current	47	2
Deferred
Federal	210	(568)
State	391	(330)
Total deferred	601	(898)
Change in liability for uncertain tax positions	23	1,579
Change in valuation allowance	(624)	(681)
Provision for income taxes	$ 47	$ 2

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Note 13 - Restructuring

12 Months Ended

Mar. 28, 2015

Restructuring and Related Activities [Abstract]

Restructuring and Related Activities Disclosure [Text Block]

 13     Restructuring

During fiscal 2013, the Company took steps to reduce current and future expenses by reducing staff and by combining the operations in Santa Rosa into its San Ramon facility. This physical move was completed on May 31, 2013. Certain employee retention agreements were extended through December 2013. Substantially all of the restructuring costs were for the Microsource reportable segment. As of March 29, 2014 the Company had expensed $780,000 related to these restructuring costs. There were no restructuring costs during fiscal 2015 and the Company does not anticipate any additional restructuring costs. Restructuring costs during fiscal 2014 were $331,000.

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Note 18 - Subsequent Events

12 Months Ended

Mar. 28, 2015

Subsequent Events [Abstract]

Subsequent Events [Text Block]

18      Subsequent Events

On June1, 2015 the Company entered into a $2.5 million Revolving Accounts Receivable Line of Credit agreement with Bridge Bank. The credit facility agreement replaced the line of credit with SVB which expired April 15, 2015. The agreement provides for a borrowing capacity of $2.5 million with the following sub-limits:

● $500,000 on a Non-Formula basis in addition to the Borrowing Base

● $100,000 under the Borrowing Base for International Services

● $100,000 under the Borrowing Base for Cash Management Services

The loan is secured by all assets of the Company including intellectual property and general intangibles and provides for a borrowing capacity equal to 80% of eligible accounts receivable. The loan matures on May 6, 2017 and bears an interest rate 1.5% over the prime rate of interest (which was 3.25% at the date of closing resulting in an interest rate of 4.75%). Interest is payable monthly with principal due upon maturity. The Company paid a commitment fee of $12,500, and an additional $12,500 is due on the first anniversary of the loan closing. The loan agreement contains financial and non-financial covenants that are customary for this type of lending and includes a covenant to maintain an asset coverage ratio of at least 135% (defined as unrestricted cash and cash equivalents maintained with Bridge Bank N.A., plus eligible accounts receivable aged less than 90 days from the invoice date, divided by the total amount of outstanding principals of all obligations under the loan agreement). The amounts due under the facility could become immediately due in the event of default or in the event of a material adverse change in the Company’s business condition (financial or otherwise), operations, properties or prospects, or ability to repay the credit based on the judgment of lender.

On June 3, 2015, concurrent with signing the $2.5 million Revolving Receivable Line of Credit with Bridge Bank, the Company amended its term loan agreement with PFG where PFG agreed to replace SVB with Bridge Bank as the holder of the first lien on the Company’s assets. The amended agreement also cancelled the additional $500,000 that was available to the Company under the June 2014 PFG Amendment. The Company agreed to pay PFG $150,000 principal payment towards the $500,000 outstanding revolving line of credit upon signing the amendment. The Company also agreed to pay PFG an additional $10,000 per month in principal payments until both loans are paid off, initially, the $10,000 will go against the $500,000 revolving line of credit, then against the term loan.

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Note 8 - Loss Per Share (Details) - Net Income/Loss and Common Shares Used in Per-share Computations (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Note 8 - Loss Per Share (Details) - Net Income/Loss and Common Shares Used in Per-share Computations [Line Items]
Net loss (in Dollars)	$ (1,673)	$ (3,742)
Common shares outstanding	5,279	5,058
Common shares assuming dilution	5,279	5,058
Loss per common share – basic (in Dollars per share)	$ (0.32)	$ (0.74)
Loss per common share – diluted (in Dollars per share)	$ (0.32)	$ (0.74)
Equity Option [Member]
Note 8 - Loss Per Share (Details) - Net Income/Loss and Common Shares Used in Per-share Computations [Line Items]
Anti-dilutive securities excluded from computation of earning per share	1,727	1,739
Restricted Stock [Member]
Note 8 - Loss Per Share (Details) - Net Income/Loss and Common Shares Used in Per-share Computations [Line Items]
Anti-dilutive securities excluded from computation of earning per share	482	122
Convertible Debt Securities [Member]
Note 8 - Loss Per Share (Details) - Net Income/Loss and Common Shares Used in Per-share Computations [Line Items]
Anti-dilutive securities excluded from computation of earning per share	1,853	1,853
Warrant [Member]
Note 8 - Loss Per Share (Details) - Net Income/Loss and Common Shares Used in Per-share Computations [Line Items]
Anti-dilutive securities excluded from computation of earning per share	1,368	1,317

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Note 2 - Cash and Cash-Equivalents (Details) (USD $)	Mar. 28, 2015	Mar. 29, 2014	Mar. 30, 2013
Cash and Cash Equivalents [Abstract]
Cash and Cash Equivalents, at Carrying Value	$ 1,170,000	$ 1,059,000	$ 1,882,000
Cash, Uninsured Amount	$ 827,000

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Consolidated Statements of Shareholders Equity (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014	Mar. 30, 2013
Balance at March	$ 2,955	$ 877	$ 3,308
Net loss	(1,673)	(3,742)
Option exercises	163
Option exercises (in Shares)	90,000
Share based compensation	827	494
Warrant charge expense	1,232
Warrant exercise and newly issued warrant, net of issuance cost	1,529
Series D preferred stock issuance, net of offering costs of $41		817
Preferred Stock [Member]
Balance at March	2,911	2,911	2,454
Balance at March (in Shares)	18,534	18,534	13,422
Series D preferred stock issuance, net of offering costs of $41		457
Series D preferred stock issuance, net of offering costs of $41 (in Shares)		5,112
Common Stock [Member]
Balance at March	19,975	16,224	15,132
Balance at March (in Shares)	6,706,065	5,181,247	5,079,747
Restricted stock granted (in Shares)	432,000	71,500
Option exercises	163
Option exercises (in Shares)	90,000
Stock granted without restrictions (in Shares)		30,000
Share based compensation	827	494
Warrant charge expense	1,232
Warrant exercise and newly issued warrant, net of issuance cost	1,529
Warrant exercise and newly issued warrant, net of issuance cost (in Shares)	1,002,818
Series D preferred stock issuance, net of offering costs of $41		598
Retained Earnings [Member]
Balance at March	(19,931)	(18,258)	(14,278)
Net loss	(1,673)	(3,742)
Series D preferred stock issuance, net of offering costs of $41		$ (238)

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Note 2 - Cash and Cash-Equivalents

12 Months Ended

Mar. 28, 2015

Cash and Cash Equivalents [Abstract]

Cash and Cash Equivalents Disclosure [Text Block]

2     Cash and Cash-Equivalents

Cash and cash-equivalents of $1.2 million and $1.1 million at March 28, 2015 and March 29, 2014, respectively, consisted of demand deposits with a financial institution that is a member of the Federal Deposit Insurance Corporation (FDIC). At March 28, 2015, $827,000 of the Company’s demand deposits exceeded FDIC insurance limits.

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Note 10 - Share-based Compensation and Employee Benefit Plans (Details) - Changes in Nonvested Restricted Stock Awards Outstanding (USD $)	12 Months Ended
	Mar. 28, 2015	Mar. 29, 2014
Changes in Nonvested Restricted Stock Awards Outstanding [Abstract]
Non-vested, shares	121,500	50,000
Non-vested, weighted average fair value	$ 1.39	$ 1.18
Granted, shares	432,000	101,500
Granted, weighted average fair value	$ 2.11	$ 1.53
Vested	71,500
Vested	$ 1.53
Forfeited or cancelled, shares		30,000
Forfeited or cancelled, weighted average fair value		$ 1.53
Non-vested, shares	482,000	121,500
Non-vested, weighted average fair value	$ 2.02	$ 1.39

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Note 17 - Exercise of Series C and Series D Warrants (Details) (USD $)	12 Months Ended		0 Months Ended
	Mar. 28, 2015	Mar. 29, 2014	Feb. 16, 2015	Feb. 23, 2015	May 14, 2015	Jul. 08, 2013	Feb. 28, 2014
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Payments of Stock Issuance Costs (in Dollars)	$ 0	$ 41,000
Other Expenses (in Dollars)	(1,386,000)
Series C and D Warrants [Member] | Alara Capital AVI II, LLC [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Proceeds from Issuance of Preferred Stock, Preference Stock, and Warrants (in Dollars)			1,500,000
Class of Warrant or Right, Number of Securities Called by Warrants or Rights				1,002,818
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)				$ 1.43
Series C and D Warrants [Member] | Alara Capital AVI II, LLC [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Proceeds from Warrant Exercises (in Dollars)				1,434,000
Payments of Stock Issuance Costs (in Dollars)				42,000
Series C and D Warrants [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Payments of Stock Issuance Costs (in Dollars)	42,000
New Warrant [Member] | Alara Capital AVI II, LLC [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights			898,634	194,437
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)			$ 1.78	$ 1.76
Number of Warrants Sold				2
Warrant,Purchase Price (in Dollars)				137,000
Warrant Purchase Price,Per Share (in Dollars per share)				$ 0.125
New Warrant [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights						511,186
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)						$ 1.43
Fair Value Assumptions, Expected Term	5 years
Fair Value Assumptions, Risk Free Interest Rate	1.54%
Fair Value Assumptions, Expected Volatility Rate	90.00%
Fair Value Assumptions, Expected Dividend Rate	0.00%
Additional Warrant [Member] | Alara Capital AVI II, LLC [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Class of Warrant or Right, Outstanding				14,587
Subsequent Event [Member] | Alara Capital AVI II, LLC [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Class of Warrant Or Right Exercised in Period					14,587
Shares Issued Upon Cashless Warrant Exercise					7,216
Issuance of Warrants [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Other Expenses (in Dollars)	$ 1,200,000
Alara Capital AVI II, LLC [Member]
Note 17 - Exercise of Series C and Series D Warrants (Details) [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights							1,017,405
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)							$ 1.43
Warrant Term				5 years

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Accounting Policies, by Policy (Policies)

12 Months Ended

Mar. 28, 2015

Accounting Policies [Abstract]

Basis of Accounting, Policy [Policy Text Block]

Basis of Presentation The consolidated financial statements are presented on the assumption that the company will continue to operate as a going concern. Discussion of recent events that Management believes support this presentation are as follows:

In fiscal 2012 the Company began to invest heavily in the development of a new Giga-tronics Division product platform, the Advanced Signal Generation System. Delays in completing the Advanced Signal Generation System have contributed significantly to the losses of the Company. In fiscal 2015 the Company’s net loss was $1.7 million, which included a non-cash expense of $1.2 million related to the issuance of new warrants to Alara Capital and $152,000 of non-cash accretion of loan and warrant debt discounts. Also in fiscal 2015 the Company had operating income of $14,000, compared to an operating loss of $4.5 million in fiscal 2014.

In the fourth quarter of fiscal 2015 the Company received $1.5 million of net proceeds associated with Alara Capital exercising 1,002,818 of existing warrants (see Note 17, Exercise of Series C and Series D Warrants). Also in the fourth quarter of fiscal 2015 two customers formally accepted initial units of the Company’s new Advanced Signal Generation System. With initial customer acceptance of Advanced Signal Generation System units, similar units of the new platform are in production for potential future sales to customers. The Company could experience longer than anticipated sales cycles or delays in production and shipping volume quantities of the Advanced Signal Generation System, however, the Company believes the Advanced Signal Generation System will significantly contribute to the Company’s long term success. On June 1, 2015 the Company entered into a two year $2.5 million Revolving Accounts Receivable Line of Credit agreement with Bridge Bank. The Bridge Bank credit facility replaced the line of credit with SVB, which expired April 15, 2015. The $2.5 million credit facility includes $500,000 on a non-formula basis in addition to the Borrowing Base. (see Note 18, Subsequent Events).

Consolidation, Policy [Policy Text Block]

Principles of Consolidation The consolidated financial statements include the accounts of Giga-tronics and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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. Actual results could differ from those estimates.

Fiscal Period, Policy [Policy Text Block]

Fiscal Year The Company’s financial reporting year consists of either a 52 week or 53 week period ending on the last Saturday of the month of March. Fiscal year 2015, ended on March 28, 2015 resulting in a 52 week year. Fiscal year 2014, ended on March 29, 2014 also resulting in a 52 week year. All references to years in the consolidated financial statements relate to fiscal years rather than calendar years.

Reclassification, Policy [Policy Text Block]

Reclassifications   Certain reclassifications, none of which affected the prior year’s net loss or shareholders’ equity, have been made to prior year balances in order to conform to the current year presentation.

Revenue Recognition, Policy [Policy Text Block]

Revenue Recognition and Deferred Revenue   The Company records revenue when there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed and determinable, and collectability is reasonably assured. This occurs when products are shipped or the customer accepts title transfer. If the arrangement involves acceptance terms, the Company defers revenue until product acceptance is received. On certain large development contracts, revenue is recognized upon achievement of substantive milestones. Determining whether a milestone is substantive is a matter of judgment and that assessment is performed only at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

a. It is commensurate with either of the following:

1. The Company’s performance to achieve the milestone.

2. The enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the Company's performance to achieve the milestone.

b. It relates solely to past performance.

c. It is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

Milestones for revenue recognition are agreed upon with the customer prior to the start of the contract and some milestones are based on product shipping while others are based on design review. In fiscal 2015 the Company’s Microsource business unit received a $6.5 million order from a major aerospace company for non-recurring engineering services to develop a variant of its high performance fast tuning YIG filters for an aircraft platform and to deliver a limited number of flight-qualified prototype hardware units (the “NRE Order”) which is being accounted for on a milestone basis. The Company considered factors such as estimated completion dates and product acceptance of the order prior to accounting for the NRE Order as milestone revenue. During the fiscal years ended March 28, 2015 and March 29, 2014, revenue recognized on a milestone basis were $4.7 million and $486,000, respectively.

On certain contracts with several of the Company’s significant customers the Company receives payments in advance of manufacturing. Advanced payments are recorded as deferred revenue until the revenue recognition criteria described above has been met.

Accounts receivable are stated at their net realizable value. The Company has estimated an allowance for uncollectable accounts based on analysis of specifically identified accounts, outstanding receivables, consideration of the age of those receivables, the Company’s historical collection experience, and adjustments for other factors management believes are necessary based on perceived credit risk.

The activity in the reserve account for doubtful accounts is as follows for the years ending March 28, 2015 and March 29, 2014:

(Dollars in thousands)	March 28, 2015		March 29, 2014
Beginning balance	$	44	$	35
Provisions (reversals of previous provisions) for doubtful accounts		1		22
Write-off of doubtful accounts		—		(13	)
Ending balance	$	45	$	44

Accrued Warranty The Company’s warranty policy generally provides one to three years of coverage depending on the product. The Company records a liability for estimated warranty obligations at the date products are sold. The estimated cost of warranty coverage is based on the Company’s actual historical experience with its current products or similar products. For new products, the required reserve is based on historical experience of similar products until such time as sufficient historical data has been collected on the new product. Adjustments are made as new information becomes available.

Inventories Inventories are stated at the lower of cost or fair value using full absorption and standard costing. Cost is determined on a first-in, first-out basis. Standard costing and overhead allocation rates are reviewed by management periodically, but not less than annually. Overhead rates are recorded to inventory based on capacity management expects for the period the inventory will be held. Reserves are recorded within cost of sales for impaired or obsolete inventory when the cost of inventory exceeds its estimated fair value. Management evaluates the need for inventory reserves based on its estimate of the amount realizable through projected sales including an evaluation of whether a product is reaching the end of its life cycle. When inventory is discarded it is written off against the inventory reserve, as inventory generally has already been fully reserved for at the time it is discarded.

Research and Development Research and development expenditures, which include the cost of materials consumed in research and development activities, salaries, wages and other costs of personnel engaged in research and development, costs of services performed by others for research and development on the Company’s behalf and indirect costs are expensed as operating expenses when incurred. Research and development costs totaled approximately $3.2 million and $3.9 million for the years ended March 28, 2015 and March 29, 2014, respectively.

Property and Equipment   Property and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the respective assets, which range from three to ten years for machinery and equipment and office fixtures. Leasehold improvements and assets acquired under capital leases are amortized using the straight-line method over the shorter of the estimated useful lives of the respective assets or the lease term.

The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such review indicates that the carrying amount of an asset exceeds the sum of its expected future cash flows on an undiscounted basis, the asset’s carrying amount would be written down to fair value. Additionally, the Company reports long-lived assets to be disposed of at the lower of carrying amount or fair value less cost to sell. As of March 28, 2015 and March 29, 2014, management believes there has been no impairment of the Company’s long-lived assets.

Derivatives The Company accounts for free standing derivatives and embedded derivatives required to be bifurcated and accounted for on a stand-alone basis at estimated fair value. Changes in fair value are reported in earnings as other income or loss.

Deferred Rent Rent expense is recognized in an amount equal to the guaranteed base rent plus contractual future minimum rental increases amortized on the straight-line basis over the terms of the leases, including free rent periods.

Income Taxes Income taxes are accounted for using the asset and liability method.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  Future tax benefits are subject to a valuation allowance when management is unable to conclude that its deferred tax assets will more likely than not be realized.  The ultimate realization of deferred tax assets is dependent upon generation of future taxable income during the periods in which those temporary differences become deductible.  Management considers both positive and negative evidence and tax planning strategies in making this assessment.

The Company considers all tax positions recognized in its financial statements for the likelihood of realization.  When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the positions taken or the amounts of the positions that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority.  The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above, if any, would be reflected as unrecognized tax benefits, as applicable, in the accompanying consolidated balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination.  The Company recognizes accrued interest and penalties, if any, related to unrecognized tax benefits as a component of the provision for income taxes in the consolidated statements of operations.

Product Development Costs The Company incurs pre-production costs on certain long-term supply arrangements. The costs, which represent non-recurring engineering and tooling costs, are capitalized as other assets and amortized over their useful life when reimbursable by the customer. All other product development costs are charged to operations as incurred. Capitalized pre-production costs included in inventory were immaterial as of March 28, 2015 and March 29, 2014.

Software Development Costs Development costs included in the research and development of new products and enhancements to existing products are expensed as incurred, until technological feasibility in the form of a working model has been established. To date, completion of software development has been concurrent with the establishment of technological feasibility, and accordingly, no costs have been capitalized.

Share-based Compensation The Company has established the 2005 Equity Incentive Plan, which provides for the granting of options for up to 2,250,000 shares of Common Stock. In 2014, the term of the 2005 Equity Incentive Plan was extended to 2025. The Company records share-based compensation expense for the fair value of all stock options and restricted stock that are ultimately expected to vest as the requisite service is rendered.

The cash flows resulting from the tax benefits resulting from tax deductions in excess of the compensation cost recognized for those options (excess tax benefits) are classified as cash flows from financing in the statements of cash flows. These excess tax benefits were not significant for the Company for the fiscal years ended March 28, 2015 or March 29, 2014.

In calculating compensation related to stock option grants, the fair value of each stock option is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. The computation of expected volatility used in the Black-Scholes-Merton option-pricing model is based on the historical volatility of Giga-tronics’ share price. The expected term is estimated based on a review of historical employee exercise behavior with respect to option grants. The risk free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. Expected dividend yield was not considered in the option pricing formula since the Company has not paid dividends and has no current plans to do so in the future.

The fair value of restricted stock awards is based on the fair value of the underlying shares at the date of the grant. Management makes estimates regarding pre-vesting forfeitures that will impact timing of compensation expense recognized for stock option and restricted stock awards.

Earnings or Loss Per Common Share Basic earnings or loss per common share is computed using the weighted average number of common shares outstanding during the period. Diluted earnings per share incorporate the incremental shares issuable upon the assumed exercise of stock options and warrants using the treasury stock method. Anti-dilutive options are not included in the computation of diluted earnings per share. Non-vested shares of restricted stock have nonforfeitable dividend rights and are considered participating securities for the purpose of calculating basic and diluted earnings per share under the two-class method.

Comprehensive Income or Loss   There are no items of comprehensive income or loss other than net income or loss.

Financial Instruments and Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk consist of cash, cash-equivalents and trade accounts receivable. The Company’s cash-equivalents consist of overnight deposits with federally insured financial institutions. Concentration of credit risk in trade accounts receivable results primarily from sales to major customers. The Company individually evaluates the creditworthiness of its customers and generally does not require collateral or other security. At March 28, 2015, and March 29, 2014, three customers combined accounted for 65% of consolidated gross accounts receivable.

Fair

Standard Product Warranty, Policy [Policy Text Block]

Accrued Warranty The Company’s warranty policy generally provides one to three years of coverage depending on the product. The Company records a liability for estimated warranty obligations at the date products are sold. The estimated cost of warranty coverage is based on the Company’s actual historical experience with its current products or similar products. For new products, the required reserve is based on historical experience of similar products until such time as sufficient historical data has been collected on the new product. Adjustments are made as new information becomes available.

Inventory, Policy [Policy Text Block]

Inventories Inventories are stated at the lower of cost or fair value using full absorption and standard costing. Cost is determined on a first-in, first-out basis. Standard costing and overhead allocation rates are reviewed by management periodically, but not less than annually. Overhead rates are recorded to inventory based on capacity management expects for the period the inventory will be held. Reserves are recorded within cost of sales for impaired or obsolete inventory when the cost of inventory exceeds its estimated fair value. Management evaluates the need for inventory reserves based on its estimate of the amount realizable through projected sales including an evaluation of whether a product is reaching the end of its life cycle. When inventory is discarded it is written off against the inventory reserve, as inventory generally has already been fully reserved for at the time it is discarded.

Research and Development Expense, Policy [Policy Text Block]

Research and Development Research and development expenditures, which include the cost of materials consumed in research and development activities, salaries, wages and other costs of personnel engaged in research and development, costs of services performed by others for research and development on the Company’s behalf and indirect costs are expensed as operating expenses when incurred. Research and development costs totaled approximately $3.2 million and $3.9 million for the years ended March 28, 2015 and March 29, 2014, respectively.

Property, Plant and Equipment, Policy [Policy Text Block]

Property and Equipment   Property and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the respective assets, which range from three to ten years for machinery and equipment and office fixtures. Leasehold improvements and assets acquired under capital leases are amortized using the straight-line method over the shorter of the estimated useful lives of the respective assets or the lease term.

The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such review indicates that the carrying amount of an asset exceeds the sum of its expected future cash flows on an undiscounted basis, the asset’s carrying amount would be written down to fair value. Additionally, the Company reports long-lived assets to be disposed of at the lower of carrying amount or fair value less cost to sell. As of March 28, 2015 and March 29, 2014, management believes there has been no impairment of the Company’s long-lived assets.

Derivatives, Policy [Policy Text Block]

Derivatives The Company accounts for free standing derivatives and embedded derivatives required to be bifurcated and accounted for on a stand-alone basis at estimated fair value. Changes in fair value are reported in earnings as other income or loss.

Lease, Policy [Policy Text Block]

Deferred Rent Rent expense is recognized in an amount equal to the guaranteed base rent plus contractual future minimum rental increases amortized on the straight-line basis over the terms of the leases, including free rent periods.

Income Tax, Policy [Policy Text Block]

Income Taxes Income taxes are accounted for using the asset and liability method.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.  Future tax benefits are subject to a valuation allowance when management is unable to conclude that its deferred tax assets will more likely than not be realized.  The ultimate realization of deferred tax assets is dependent upon generation of future taxable income during the periods in which those temporary differences become deductible.  Management considers both positive and negative evidence and tax planning strategies in making this assessment.

The Company considers all tax positions recognized in its financial statements for the likelihood of realization.  When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the positions taken or the amounts of the positions that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority.  The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above, if any, would be reflected as unrecognized tax benefits, as applicable, in the accompanying consolidated balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination.  The Company recognizes accrued interest and penalties, if any, related to unrecognized tax benefits as a component of the provision for income taxes in the consolidated statements of operations.

Product Development Costs, Policy [Policy Text Block]

Product Development Costs The Company incurs pre-production costs on certain long-term supply arrangements. The costs, which represent non-recurring engineering and tooling costs, are capitalized as other assets and amortized over their useful life when reimbursable by the customer. All other product development costs are charged to operations as incurred. Capitalized pre-production costs included in inventory were immaterial as of March 28, 2015 and March 29, 2014.

Software Development Costs, Policy [Policy Text Block]

Software Development Costs Development costs included in the research and development of new products and enhancements to existing products are expensed as incurred, until technological feasibility in the form of a working model has been established. To date, completion of software development has been concurrent with the establishment of technological feasibility, and accordingly, no costs have been capitalized.

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

Share-based Compensation The Company has established the 2005 Equity Incentive Plan, which provides for the granting of options for up to 2,250,000 shares of Common Stock. In 2014, the term of the 2005 Equity Incentive Plan was extended to 2025. The Company records share-based compensation expense for the fair value of all stock options and restricted stock that are ultimately expected to vest as the requisite service is rendered.

The cash flows resulting from the tax benefits resulting from tax deductions in excess of the compensation cost recognized for those options (excess tax benefits) are classified as cash flows from financing in the statements of cash flows. These excess tax benefits were not significant for the Company for the fiscal years ended March 28, 2015 or March 29, 2014.

In calculating compensation related to stock option grants, the fair value of each stock option is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. The computation of expected volatility used in the Black-Scholes-Merton option-pricing model is based on the historical volatility of Giga-tronics’ share price. The expected term is estimated based on a review of historical employee exercise behavior with respect to option grants. The risk free interest rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. Expected dividend yield was not considered in the option pricing formula since the Company has not paid dividends and has no current plans to do so in the future.

The fair value of restricted stock awards is based on the fair value of the underlying shares at the date of the grant. Management makes estimates regarding pre-vesting forfeitures that will impact timing of compensation expense recognized for stock option and restricted stock awards.

Earnings Per Share, Policy [Policy Text Block]

Earnings or Loss Per Common Share Basic earnings or loss per common share is computed using the weighted average number of common shares outstanding during the period. Diluted earnings per share incorporate the incremental shares issuable upon the assumed exercise of stock options and warrants using the treasury stock method. Anti-dilutive options are not included in the computation of diluted earnings per share. Non-vested shares of restricted stock have nonforfeitable dividend rights and are considered participating securities for the purpose of calculating basic and diluted earnings per share under the two-class method.

Comprehensive Income, Policy [Policy Text Block]

Comprehensive Income or Loss   There are no items of comprehensive income or loss other than net income or loss.

Concentration Risk, Credit Risk, Policy [Policy Text Block]

Financial Instruments and Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk consist of cash, cash-equivalents and trade accounts receivable. The Company’s cash-equivalents consist of overnight deposits with federally insured financial institutions. Concentration of credit risk in trade accounts receivable results primarily from sales to major customers. The Company individually evaluates the creditworthiness of its customers and generally does not require collateral or other security. At March 28, 2015, and March 29, 2014, three customers combined accounted for 65% of consolidated gross accounts receivable.

Fair Value of Financial Instruments, Policy [Policy Text Block]

Fair Value of Financial Instruments and Fair Value Measurements   The Company’s financial instruments consist principally of cash and cash-equivalents, line of credit, term debt, warrant liability and warrant derivative liability. The fair value of a financial instrument is the amount at which the instrument could be exchanged in an orderly transaction between market participants to sell the asset or transfer the liability. The Company uses fair value measurements based on quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity can access as of the measurement date (Level 1), significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data (Level 2), or significant unobservable inputs reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability (Level 3), depending on the nature of the item being valued.

The carrying amounts of the Company’s cash and cash-equivalents and line of credit approximate their fair values at each balance sheet date due to the short-term maturity of these financial instruments. The fair values of term debt and warrant debt are based on the present value of expected future cash flows and assumptions about current interest rates and the creditworthiness of the Company (Level 3). At March 28, 2015 the carrying amounts of the Company’s term debt and warrant debt totaled $1.1 million and $82,000, respectively. At March 28, 2015 the estimated fair values of the Company’s term debt and warrant debt totaled $1.2 million and $112,000, respectively. At March 29, 2014, the carrying amounts of the Company’s term debt and warrant debt totaled $822,000 and $50,000, respectively, and the carrying amounts approximated fair value since the agreement was entered into near the balance sheet date. The fair value of the bifurcated conversion feature represented by the warrant derivative liability which is measured at fair value on a recurring basis is based on a Black Scholes option pricing model with assumptions for stock price, exercise price, volatility, expected term, risk free interest rate and dividend yield similar to those described previously for share-based compensation which were generally observable (Level 2). The Company had no assets or liabilities measured at fair value on a non-recurring basis, nor were there any transfers between Level 1 and Level 2 of the fair value hierarchy.

New Accounting Pronouncements, Policy [Policy Text Block]

Recently Issued Accounting Standards

In April 2014, the Financial Accounting Standards Board (FASB) issued an accounting standard update that changes the criteria for reporting discontinued operations. Under the accounting standard update, a disposal of a component of an entity or a group of components of an entity is required to be reported in discontinued operations if the disposal represents a strategic shift that has, or will have, a major effect on an entity’s operations and financial results when either it qualifies as held for sale, disposed of by sale, or disposed of other than by sale. This accounting standard update will be effective for the Company beginning in the first quarter of fiscal 2016. The Company is currently evaluating the impact of this accounting standard update on its Consolidated Financial Statements.

In May 2014, the FASB amended the accounting standards by creating a new Topic 606 which is in response to a joint initiative of the FASB and the International Accounting Standards Board to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. generally accepted accounting principles and international financial reporting standards that would:

1. Remove inconsistencies and weaknesses in revenue requirements.

2. Provide a more robust framework for addressing revenue issues.

3. Improve comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets.

4. Provide more useful information to users of financial statements through improved disclosure requirements.

5. Simplify the preparation of financial statements by reducing the number of requirements to which an entity must refer.

For a public entity, the amendments in this Update are effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early application is not permitted. The Company is currently evaluating the impact this new accounting standard will have on its financial statements.

In June 2014, the FASB amended ASC 718, Share Based Compensation, to require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. For all entities, the amendments in this update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The Company is currently evaluating the impact this accounting standard update may have on its financial statements.    

In August 2014, the FASB issued ASU 2014-15 which provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity’s ability to continue as a going concern. The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. The Company is currently evaluating the impact this accounting standard update may have on its financial statements.

In April 2015, the FASB issued ASU 2015-03, “Interest - Imputation of Interest (Subtopic 835-30) – Simplifying the Presentation of Debt Issuance Costs,” or ASU 2015-03. ASU 2015-03 simplifies the presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct reduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by this ASU. The amendments in this ASU are effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. The adoption of this ASU by the Company will change the presentation of debt issuance costs, which will be reported as a direct offset to the applicable debt on the balance sheet

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Note 16 - Series B, C, D Convertible Voting Perpetual Preferred Stock and Warrants (Tables)

12 Months Ended

Mar. 28, 2015

Disclosure Text Block Supplement [Abstract]

Schedule of Stock by Class [Table Text Block]

							Liquidation
	Designated Shares		Shares Issued		Shares Outstanding		Preference (in thousands)
Series B		10,000.00		9,997.00		9,997.00	$	2,309
Series C		3,500.00		3,424.65		3,424.65		500
Series D		6,000.00		5,111.86		5,111.86		731
Total		19,500.00		18,533.51		18,533.51	$	3,540

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Note 12 - Warranty Obligations

12 Months Ended

Mar. 28, 2015

Product Warranties Disclosures [Abstract]

Product Warranty Disclosure [Text Block]

12     Warranty Obligations

The Company records a liability in cost of sales for estimated warranty obligations at the date products are sold. Adjustments are made as new information becomes available. The following provides a reconciliation of changes in the Company’s warranty reserve. The Company provides no other guarantees.

(Dollars in thousands)	March 28, 2015			March 29, 2014
Balance at beginning of year	$	61		$	114
Provision, net		81			(5	)
Warranty costs incurred		(66	)		(48	)
Balance at end of year	$	76		$	61