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DISCONTINUED OPERATIONS | 12 Months Ended
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Dec. 26, 2021
Discontinued Operations and Disposal Groups [Abstract] |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS On February 28, 2022, the Company entered into an Asset Purchase Agreement (“APA”) with Sentech Engineering Services, Inc., (“Sentech”), and Job and Talent Holding Limited, the indirect parent of Sentech, solely as guarantor of certain obligations of Sentech, pursuant to which the Company would sell to Sentech substantially all of the assets pertaining to the Company’s Light Industrial segment (“InStaff”). Under the APA, Sentech will (i) pay to the Company approximately $30.3 million at the closing of the transaction, (ii) subject to the terms and conditions of the APA, pay to the Company an additional $2 million on the first anniversary of the closing of the transaction, and (iii) assume certain liabilities and obligations of the Company pertaining to the Light Industrial segment. The APA further provides for customary purchase price adjustments, including a net working capital adjustment. Job and Talent Holding Limited has guaranteed certain of Sentech’s obligations under the APA. The APA contains customary representations and warranties, covenants (including certain non-competition and non-solicitation covenants restricting the Company with respect to the light industrial staffing business), closing conditions, and indemnification provisions. After the closing of the transaction, the Company will provide certain back-office services to Sentech for a limited period of time. Discontinued operations – InStaff Operations In accordance with ASC 205-10-05-3, the Light Industrial financial results for periods prior to the sale have been reflected in our Consolidated Statements of Operations and Comprehensive Income and Consolidated Statements of Cash Flows as discontinued operations. Additionally, the related assets and liabilities associated with the discontinued operations in the periods presented are classified as discontinued operations in our Consolidated Balance Sheets. The following table presents the financial results of InStaff for the fiscal years presented (dollars in thousands):
| Fiscal Year
| 2021 |  | 2020 |  | 2019
Revenue | $ | 71,292 |  |  | $ | 70,765 |  |  | $ | 74,549 |
Cost of services | 60,948 |  |  | 60,585 |  |  | 63,694 |
Gross profit | 10,344 |  |  | 10,180 |  |  | 10,855 |
Selling expenses | 5,684 |  |  | 5,315 |  |  | 5,977 |
Depreciation | 90 |  |  | 99 |  |  | 102 |
Income from operations of discontinued operations before taxes | 4,570 |  |  | 4,766 |  |  | 4,776 |
Income taxes | (918) |  |  | (1,253) |  |  | (1,170) |
Income from discontinued operations, net of income taxes | $ | 3,652 |  |  | $ | 3,513 |  |  | $ | 3,606 |
The following table presents the aggregate carrying amounts of assets to be sold and liabilities to be assumed of discontinued operations for InStaff in the Consolidated Balance Sheet (dollars in thousands):
| December 26, 2021 |  | December 27, 2020
Carrying amount of assets included as part of discontinued operations: |  |  |
Accounts receivable | $ | 7,198 |  |  | $ | 8,663 |
Property and equipment, net | 201 |  |  | 260 |
Deposits | 36 |  |  | 36 |
Right-of-use assets - operating leases | 303 |  |  | 459 |
Intangible assets, net | 1,648 |  |  | 1,648 |
Goodwill | 5,025 |  |  | 5,025 |
Total assets classified as discontinued operations | $ | 14,411 |  |  | $ | 16,091 |
Carrying amount of liabilities included as part of discontinued operations: |  |  |
Accrued payroll and expenses | $ | 1,129 |  |  | $ | 1,073 |
Lease liability, current portion | 133 |  |  | 166 |
Lease liability, less current portion | 190 |  |  | 323 |
Total liabilities classified as discontinued operations | $ | 1,452 |  |  | $ | 1,562 |

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
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