10-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-K/A

Amendment No. 1

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 29, 2018

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 number 0-19882

KOPIN CORPORATION

(Exact Name of Registrant as Specified in its Charter)

Delaware			04-2833935
State or other jurisdiction of incorporation or organization			(I.R.S. Employer Identification No.)
125 North Drive,	Westborough	MA	01581-3335
(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: (508) 870-5959

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01	KOPN	Nasdaq Global Market

Securities registered pursuant to Section 12(b) 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 ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). ☒ Yes ☐ No

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. ☐

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

Large Accelerated Filer	☐	Accelerated Filer	☒
Non-Accelerated Filer	☐	Smaller Reporting Company	☐
		Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes ☐ No ☐

Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of June 30, 2018 (the last business day of the registrant's most recent second fiscal quarter), the aggregate market value of outstanding shares of voting stock held by non-affiliates of the registrant was $164,583,000.

As of March 8, 2019, 76,282,062 shares of the registrant’s Common Stock, par value $.01 per share, were issued and outstanding.

EXPLANATORY NOTE

Kopin Corporation (the "Company" or "Kopin") is filing this Amendment No. 1 on Form 10-K/A (this "Form 10-K/A") to its Annual Report on Form 10-K for the fiscal year ended December 29, 2018, originally filed with the U.S. Securities and Exchange Commission (the "SEC") on March 14, 2019 (the "Original Form 10-K") to update the Report of Independent Registered Public Accounting Firm to indicate that the consolidated balance sheet as of December 30, 2017 was audited. The Report of Independent Registered Public Accounting Firm within the Original Form 10-K omitted that the consolidated balance sheet as of December 30, 2017 was audited.

In addition, the Company is correcting immaterial misstatements it has identified in its previously-issued consolidated financial statements and related financial information for the fiscal years ended December 29, 2018, December 30, 2017 and December 31, 2016. The following sections of this Form 10-K/A contain information that has been revised to reflect the corrections:

•Part I, Item 1A. Risk Factors

•Part II, Item 6. Selected Financial Data

•Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

•Part II, Item 8. Financial Statements and Supplementary Data

•Part II, Item 9A. Controls and Procedures

•Part IV, Item 15. Exhibits and Financial Statement Schedules

Lastly, due to a material weakness in our internal control over financial reporting identified as a result of the misstatements discussed above, the Company is amending Part II, Item 9A "Controls and Procedures" with respect to (a) the Company's conclusions regarding the effectiveness of (i) the Company's disclosure controls and procedures and (ii) our internal control over financial reporting, and (b) Deloitte & Touche LLP’s related attestation report on our internal control over financial reporting.

Except as described in this Explanatory Note, the information contained in the Original Form 10-K has not been revised to reflect any subsequent events.

Background

In 2018, the Company liquidated its Korean subsidiary, Kowon. At the time of liquidation the Company owned approximately 93% of the equity of Kowon. The liquidation event was triggered in 2018 by the Company’s decision to not reinvest the net assets generated from Kowon in Korea. Although the Company paid the proper amounts to the noncontrolling interest holder in 2017 and 2018 based on its ownership percentage, the Company has determined that the consolidated financial statements were incorrect because of two prior period errors impacting the amounts previously reported as noncontrolling interest as well as two errors made when recording the effects of the 2018 liquidation.

Effects of the Immaterial Misstatements

A summary of these errors and their impact on the consolidated financial statements are as follows:

1. The Company improperly calculated the noncontrolling interest amount of Kowon when the Company made equity investments in years prior to 2015. The Company has corrected for this misstatement in the accompanying Consolidated Statements of Stockholders’ Equity, which resulted in a decrease to additional paid-in capital and an increase to noncontrolling interest of $1.2 million as of December 26, 2015. This correction impacted the respective equity categories in the accompanying Consolidated Statements of Stockholders’ Equity and Consolidated Balance Sheets for 2016, 2017 and 2018.

2. In 2016, upon recognition of a gain on sale of Kowon assets, the Company did not properly allocate the portion of the gain attributable to the noncontrolling interest in the amount of $0.1 million. The Company has corrected for this misstatement in the accompanying 2016 Consolidated Statement of Operations, which consequently impacts the accompanying Consolidated Statements of Stockholders’ Equity by increasing accumulated deficit and increasing noncontrolling interest for $0.1 million as of December 31, 2016.

3. In 2018, when the Company liquidated Kowon, it was carrying approximately $1.7 million in cumulative translation adjustments ("CTA") related to Kowon's net assets. Approximately $0.4 million of CTA was correctly reclassified into earnings in 2018, however, the remaining $1.3 million was incorrectly reclassified directly to noncontrolling interest to offset cumulative understatement in noncontrolling interest that resulted from the two prior period errors noted above. This caused the net loss in the accompanying 2018 Consolidated Statement of Operations to be overstated by $1.3 million, which the Company has corrected in the accompanying Consolidated Statements of Operations.

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4. In addition, in connection with the liquidation of Kowon, the Company understated its distribution to the noncontrolling interest holder in the accompanying 2018 Consolidated Statement of Cash Flows by less than $0.1 million, which the Company has corrected in the accompanying Consolidated Statements of Cash Flows.

Internal Control Considerations

On October 17, 2019, the Audit Committee of our Board of Directors (the “Audit Committee”) determined that it would be necessary for the Company to correct certain immaterial misstatements identified in its previously-issued consolidated financial statements. The Audit Committee made this determination following consultation with and upon the recommendation of management. Refer to "Part II. Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations" and Note 18. Correction of Previously Issued Financial Statements included in "Part IV. Item 15 - Exhibits and Financial Statement Schedules" for a more detailed description of the misstatements.

Notwithstanding the existence of the material weakness described in “Part II. Item 9A - Controls and Procedures,” we believe that the consolidated financial statements in this Form 10-K/A fairly present, in all material respects, our financial position, results of operations and cash flows as of the dates, and for the periods, presented, in conformity with generally accepted accounting principles (“GAAP”).

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Part I

Forward Looking Statements

This Annual Report on Form 10-K/A contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which are subject to the safe harbor created by such sections. Words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “could,” “would,” “seeks,” “estimates,” and variations of such words and similar expressions, and the negatives thereof, are intended to identify such forward-looking statements. We caution readers not to place undue reliance on any such “forward-looking statements,” which speak only as of the date made, and advise readers that these forward-looking statements are not guarantees of future performance and involve certain risks, uncertainties, estimates, and assumptions by us that are difficult to predict. Various factors, some of which are beyond our control, could cause actual results to differ materially from those expressed in, or implied by, such forward-looking statements. All such forward-looking statements, whether written or oral, and whether made by us or on our behalf, are expressly qualified by these cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, we disclaim any obligation to update any forward-looking statements to reflect events or circumstances after the date of this report, except as may otherwise be required by the federal securities laws.

We have identified the following important factors that could cause actual results to differ materially from those discussed in our forward-looking statements. Such factors may be in addition to the risks described in Part I, Item 1A. “Risk Factors;” Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations;” and other parts of this Form 10-K/A. These factors include: our ability to continue as a going concern; the material weakness management has identified in our internal control over financial reporting, its conclusion that our disclosure controls and procedures were not effective as of the fiscal year ended December 29, 2018, and our ability to remediate that material weakness; our ability to obtain raw materials and other goods as well as services from our suppliers as needed; our intent to continue focusing our development efforts on proprietary wearable computing systems; the potential for customers to choose our competitors as their supplier; our expectation that we will have negative cash flow from operating activities in 2019; our ability to prosecute and defend our proprietary technology aggressively or successfully; our ability to retain personnel with experience and expertise relevant to our business; our ability to invest in research and development to achieve profitability even during periods when we are not profitable; our ability to continue to introduce new products in our target markets; the degree to which our wearable technology is embraced by consumers and commercial users; our ability to develop and expand our wearable technologies and to market and license our concept systems and components; our ability to generate revenue growth and positive cash flow, and reach profitability; the strengthening of the U.S. dollar and its effects on the price of our products in foreign markets; the impact of new regulations and customer demands relating to conflict minerals; our ability to obtain a competitive advantage in the wearable technologies market through our extensive portfolio of patents, trade secrets and non-patented know-how; our ability to grow within our targeted markets; smartphone makers’ intent to create products that work as a complement to smartphones or that will eventually replace smartphones with more convenient configurations; the importance of small form factor displays in the development of military, consumer, and industrial products such as thermal weapon sights, safety equipment, virtual and augmented reality gaming, training and simulation products and metrology tools; our ability to successfully offer and market our SOLOS smart glasses directly via the Internet; our ability to offer Golden-i Infinity through value added resellers; the suitability of our properties for our needs for the foreseeable future; our expectation not to pay cash dividends for the foreseeable future and to retain earnings for the development of our businesses; our expectation that we will expend between $1.5 million and $2.0 million on capital expenditures over the next twelve months; if we do not soon achieve and maintain positive cash flow and profitability, our financial condition will ultimately be materially adversely affected, and we will be required to reduce expenses, including our investments in research and development or raise additional capital; our ability to support our operations and capital needs for at least the next twelve months through our available cash resources; our expectation that we will incur taxes based on our foreign operations in 2019; and our expectation that we will have a state tax provision in 2019.

Item 1A. Risk Factors

Our management has identified a material weakness in our internal control over financial reporting and has concluded that, due to such material weakness, our disclosure controls and procedures were not effective as of the end of our most recent fiscal year, December 29, 2018. If not remediated, our failure to establish and maintain effective disclosure controls and procedures and internal control over financial reporting could result in material misstatements in our financial statements and a failure to meet our reporting and financial obligations, each of which could have a material adverse effect on our financial condition and the trading price of our common stock. As discussed in Item 9A. “Controls and Procedures” in this Form 10-K/A

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, we have re-evaluated our internal control over financial reporting and our disclosure controls and procedures and concluded that they were not effective as of December 29, 2018 because of a material weakness. A material weakness is defined as a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. We are committed and are taking steps necessary to remediate the control deficiencies that constituted the material weakness by implementing changes to our internal control over financial reporting. We are in the process of designing and implementing measures to remediate the underlying causes of the control deficiencies that gave rise to the material weakness.

If our stock price continues to remain below $1.00, our common stock may be subject to delisting from The Nasdaq Stock Market. On October 9, 2019, we received a notice from The Nasdaq Stock Market ("Nasdaq") that the Company is not in compliance with Nasdaq's Listing Rule 5450(a)(1), as the minimum bid price of Kopin's common stock has been below $1.00 per share for 30 consecutive business days. The notification of noncompliance has no immediate effect on the listing or trading of Kopin's common stock on the Nasdaq Global Market under the symbol "KOPN." The Company has 180 calendar days, or until April 6, 2020, to achieve compliance with the minimum bid price requirement. To regain compliance, the minimum bid price of Kopin's common stock must meet or exceed $1.00 per share for a minimum ten consecutive business days during this 180-day grace period. The Company's failure to regain compliance during this period could result in delisting. Kopin is presently evaluating various courses of action to regain compliance. There can be no assurance that Kopin will be able to regain compliance with Nasdaq's rule or will otherwise be in compliance with other Nasdaq listing criteria.

We have experienced a history of losses, have a significant accumulated deficit, have had negative cash flow from operating activities in 2018, 2017, and 2016, and expect to have negative cash flow from operating activities in 2019. Since inception, we have incurred significant net operating losses. As of December 29, 2018, we had an accumulated deficit of $271.7 million. At December 29, 2018 and December 30, 2017, we had $37.2 million and $68.8 million of cash and cash equivalents and marketable securities, respectively. For the years 2018 and 2017, net cash used in operating activities was $28.1 million and $25.9 million, respectively. The decline in our cash and cash equivalents and marketable securities is primarily a result of funding our operating losses, of which a significant component is our investments in research and development for Wearable products. Our products are targeted towards the wearable market, which we believe is still developing and we cannot predict how long the wearable market will take to develop or if our products will be accepted. Accordingly, we plan to continue to invest in research and development even during periods when we are not profitable, which may result in our incurring losses from operations and negative cash flow. If we do not soon achieve and maintain positive cash flow and profitability, our financial condition will ultimately be materially and adversely affected, and we will be required to raise additional capital. We may not be able to raise any necessary capital on commercially reasonable terms or at all. If we fail to achieve or maintain profitability on a quarterly or annual basis within the timeframe expected by investors, the market price of our common stock may decline.

Our history of net operating losses and our accumulated deficit raise substantial doubt regarding our ability to continue as a going concern. If we do not continue as a going concern, investors could lose their entire investment. Our history of net operating losses, in addition to our significant accumulated deficit, has raised substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent upon our becoming profitable in the future or to obtain the necessary capital to meet our obligations and repay our liabilities when they become due. Our determination of substantial doubt as going concern could materially limit our ability to raise additional funds through the issuance of equity securities or otherwise. There can be no assurance that we will ever become profitable or continue as a going concern.

The market segment for our Wearable products may take longer to develop than we anticipate or may not develop, which may impact our ability to grow revenues. We have developed head-worn, voice and gesture controlled, hands-free cloud computing headset systems that we intend to sell and license to customers and various components for wearable devices that we intend to sell to customers as either a part of the license arrangement or separately. We refer to our headset systems and components sold to customers for use in consumer applications as our Wearable products. Our success will depend on the acceptance of wearable products by consumers and in particular the widespread adoption of the headset format. We are unable to predict when or if consumers will adopt wearable products. Customers may determine that the headset is not comfortable, weighs too much, costs too much or provides insufficient functionality. In addition, even if consumers accept the wearable headset products, Wearable product manufactures may choose to manufacture our competitors’ products. Our success in commercializing our Wearable products is very important in our ability to achieve positive cash flow and profitability. If we are unable to commercialize our Wearable products, we may be unable to increase revenues or achieve profitability or positive cash flow.

Our revenues and cash flows could be negatively affected if sales of our Display products for military applications significantly decline. The sale of our display products to the military for use in thermal weapon sights and avionic helmets have

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been a primary source of our military revenues over the last several years. We currently are designed in certain systems and are in qualification for other certain systems in the Family Weapon Sight ("FWS") program, which we believe is the next significant government procurement program that will use our technology. We may not be awarded the systems we are in qualification for, and for the systems we are qualified for we may only be awarded a portion of the program as the U.S. military looks to have multiple sources when possible. In addition, the government could postpone or cancel the programs. Our ability to generate revenues and cash flow from sales to the U.S. military depends on our Display products being qualified and remaining qualified in the F-35 Strike Fighter, FWS and other U.S. military programs and on the U.S. military funding these programs. We believe the U.S. military is evaluating alternative display technologies for the F-35 Strike Fighter program. Our ability to generate revenues and cash flow from sales to the U.S. military also depends on winning contracts over our competitors. If we are unable to be qualified into new U.S. military programs, remain qualified in existing programs, or win orders against our competition, or if military programs are not funded, then our ability to generate revenues and achieve profitability and positive cash flow will be negatively impacted.

We generally do not have long-term contracts with our customers, which makes forecasting our revenues and operating results difficult. We generally do not enter into long-term agreements with our customers obligating them to purchase our products. Our business is characterized by short-term purchase orders and shipment schedules and we generally permit orders to be canceled or rescheduled before shipment without significant penalty. As a result, our customers may cease purchasing our products at any time, which makes forecasting our revenues difficult. In addition, due to the absence of substantial non-cancelable backlog, we typically plan our production and inventory levels based on internal forecasts of customer demand, which are highly unpredictable and can fluctuate substantially. The uncertainty of product orders makes it difficult for us to forecast our sales and allocate our resources in a manner consistent with our actual sales. Moreover, our expense levels and the amounts we invest in capital equipment and new product development costs are based in part on our expectations of future sales and, if our expectations regarding future sales are inaccurate, we may be unable to reduce costs in a timely manner to adjust for sales shortfalls. If we fail to accurately forecast our revenues and operating results, our business may not be successful and the price of our common stock may decline. As a result of these and other factors, investors should not rely on our revenues and our operating results for any one quarter or year as an indication of our future revenues or operating results. If our quarterly revenues or results of operations fall below expectations of investors or public market analysts, the price of our common stock could fall substantially.

Fluctuations in operating results make financial forecasting difficult and could adversely affect the price of our common stock. Our quarterly and annual revenues and operating results may fluctuate significantly for numerous reasons, including:

• The timing of the initial selection of our Wearable technology and display products as components in our customers' new products;

• Availability of interface electronics for our display products;

• Competitive pressures on selling prices of our products;

• The timing and cancellation of customer orders;

• Our ability to introduce new products and technologies on a timely basis;

• Our ability to successfully reduce costs;

• The cancellation of U.S. government contracts; and

• Our ability to secure agreements from our major customers for the purchase of our products.

As a result of these and other factors, investors should not rely on our revenues and our operating results for any one quarter or year as an indication of our future revenues or operating results. If our quarterly revenues or results of operations fall below expectations of investors or public market analysts, the price of our common stock could fall substantially.

Our ability to manufacture and distribute our Display products would be severely limited if the foundries that we rely on to manufacture integrated circuits for our Display products fail to provide those services. We depend principally on a Taiwanese foundry for the fabrication of integrated circuits for our display products. In addition, our strategy is to use Chinese foundry services for OLED deposition and processing of OLED displays. We have no long-term contracts with foundries and from time to time we have been put on allocation, which means the foundry will limit the number of wafers they will process for us. If foundries were to terminate their arrangement with us or become unable to provide the required capacity and quality on a timely basis, we may not be able to manufacture and ship our Display products or may be forced to manufacture them in limited quantities until replacement foundry services can be obtained. Furthermore, we cannot assure that we would be able to establish alternative manufacturing and packaging relationships on acceptable terms.

Our reliance on these foundries involves certain risks, including but not limited to:

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• Lack of control over production capacity and delivery schedules;

• Limited control over quality assurance, manufacturing yields and production costs;

• The risks associated with international commerce, including unexpected changes in legal and regulatory requirements, changes in tariffs and trade policies and political and economic instability; and

• Natural disasters such as earthquakes, tsunami, mudslides, drought, hurricanes and tornadoes.

Due to natural disasters such as earthquakes and typhoons that have occasionally occurred in Asia, many Taiwanese companies, including the Taiwanese foundry we use, have experienced related business interruptions. Our business could suffer significantly if any of the foundries we use had operations disrupted for an extended period of time due to natural disaster, political unrest or financial instability.

We depend on third parties to provide integrated circuit chip sets and critical raw materials for use with our headset systems and components and we periodically receive “end of life” notices from suppliers that they will no longer be providing a raw material. We do not manufacture the integrated circuit chip sets that are used to electronically interface between our display products and our customers’ products. Instead, we rely on third party independent contractors for these integrated circuit chip sets. We purchase critical raw materials such as special glasses, special silicon on insulator ("SOI") wafers, LED, adhesives, chemicals, lenses, backlights, printed circuit boards and other components from third party suppliers. Some of these third party contractors and suppliers are small companies with limited financial resources. In addition, relative to the commercial market, the military buys a small number of units, which prevents us from qualifying and buying components economically from multiple vendors. We periodically receive notices from suppliers of our critical raw materials regarding their plans to stop selling those raw materials. This requires us to identify another raw material and/or raw material supplier to replace the discontinued item/supplier, which would then require us to internally re-qualify the product with the new material as well as possibly re-qualify the product with our customer. If any of these third party contractors or suppliers were unable or unwilling to supply these integrated circuit chip sets or critical raw materials to us, whether for business or regulatory reasons, we would be unable to manufacture and sell our display products until a replacement material could be found. We may not be able to find a replacement material or chemical or if we are able to find a replacement material we may be unable to sell our products until they have been qualified both internally and with the customer. Lower volume purchases may make it uneconomical for some of our suppliers to provide the raw materials we need. We cannot assure investors that a replacement third party contractor or supplier could be found on reasonable terms or in a timely manner. Any interruption in our ability to manufacture and distribute our display products could cause our display business to be unsuccessful and the price of our common stock may decline.

The markets in which we operate are highly competitive and rapidly changing and we may be unable to compete successfully. There are a number of companies that develop or may develop products that compete in our targeted markets. The individual components that we offer for sale (displays, optical lenses, backlights and ASICs, the Whisper Chip) are also offered by companies whose sole business focuses on that individual component. For example, there are companies whose sole business is to sell optical lenses. Accordingly, our strategy requires us to develop technologies and to compete in multiple markets. Some of our competitors are much larger than we are and have significantly greater financial, development and marketing resources than we do. The competition in these markets could adversely affect our operating results by reducing the volume of the products we sell or the prices we can charge. These competitors may be able to respond more rapidly than us to new or emerging technologies or changes in customer requirements. They may also devote greater resources to the development, promotion and sale of their products than we do.

Our success will depend substantially upon our ability to enhance our products and technologies and to develop and introduce, on a timely and cost-effective basis, new products and features that meet changing customer requirements and incorporate technological enhancements. If we are unable to develop new products and enhance functionalities or technologies to adapt to these changes, our business will suffer.

Disruptions of our production could adversely affect our operating results. If we were to experience any significant disruption in the operation of our facilities, we would be unable to supply our products to our customers. Many of our sales contracts include financial penalties for late delivery. In the past, we have experienced power outages at our facilities, which ranged in duration from one to four days. We have certain critical pieces of equipment necessary to operate our facilities that are no longer offered for sale and we may not have service contracts or spare parts for the equipment. Additionally, as we introduce new equipment into our manufacturing processes, our display products could be subject to especially wide variations in manufacturing yields and efficiency. We may experience manufacturing problems that would result in delays in product introduction and delivery or yield fluctuations.

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A disruption to our information technology systems could significantly impact our operations, revenue and profitability. Our data processing systems are cloud-based and hosted by third parties. We also use software packages that are no longer supported by their developer. We have experienced short-term (i.e., a few days) interruptions in our Internet connectivity. An interruption of the third party systems or the infrastructure that allows us to connect to the third party systems for an extended period may affect our ability to operate our business and process transactions, which could result in a decline in sales and affect our ability to achieve or maintain profitability.

If our information technology security systems were penetrated and confidential and or proprietary information were taken, we could be subject to fines, law suits and loss of customers. Significantly larger organizations with much greater resources than us have been the victim of cybercrimes. We routinely receive emails probing our Internet security, and our Internet security systems have detected outside organizations attempting to install Trojan virus software packages in our systems. We rely on our electronic information systems to perform the routine transactions to run our business. We transact business over the Internet with customers, vendors and our subsidiaries and have implemented security measures to protect unauthorized access to this information. We have also implemented security policies that limit access via the Internet from the Company to the outside world based on the individual’s position in the Company. We routinely receive security patches from software providers for the software we use. Our primary concerns are inappropriate access to personnel information, information covered under the International Traffic in Arms Regulation, product designs and manufacturing information, financial information and our intellectual property, trade secrets and know-how.

Our headset systems depend on software that we have limited experience in developing, marketing or licensing. Our headset systems include a combination of commercially available software and operating and speech enhancement software that we internally developed or acquired. In addition, we are offering the Whisper Chip, which is an integrated circuit that contains software developed by us. We have little experience in developing, marketing or licensing software. If we are unable to integrate internally developed or acquired software in our headset system, we may not be able to license such designs. The market demand for our headset systems or the products our customers may develop based on our headset systems depends on our ability to collaborate with software developers who write application software in order to create utility for our customer’s products. If we are unable to develop, license or acquire software or if we or the market in general does not create a sufficient body of application software, our systems may not be accepted by the market and we may not be able to increase revenues, achieve profitability or positive cash flow.

If we are unable to obtain or maintain existing software license relationships or other relationships relating to the intellectual property we use, our ability to grow revenue and achieve profitability and positive cash flow may be negatively affected. Our headset systems include software that we license from other companies. Should we violate the terms of a license, our license could be canceled. Companies may decide to stop supporting the software we license or new versions of the software may not be compatible with our software, which would require us to rewrite our software, which we may not be able to do. Moreover, the license fees we pay may be increased, which would negatively affect our ability to achieve profitability and positive cash flow.

Our headset systems use software that we license from other companies ("Licensors") and require us to access the Licensors’ data centers, and interruptions or delays in service from data center hosting facilities could impair our customers’ products. Any damage to, or failure of, our Licensors’ systems generally could result in interruptions in service to our customers. Interruptions in service to our customers may reduce our revenue, cause us to issue credits or pay penalties, cause customers to terminate their contracts and reduce our ability to attract new customers.

The process of seeking patent protection can be time consuming and expensive and we cannot be certain that patents will be issued from currently pending or future patent applications or that our existing patents or any new patents that may be issued will be sufficient in scope and strength to provide meaningful protection or any commercial advantage to us. We may be subject to or may initiate contested patent or patent application proceedings in the United States Patent and Trademark Office, foreign patent offices or the courts, which can demand significant financial and management resources. Patent applications in the U.S. typically are maintained in secrecy until they are published about 18 months after their earliest claim to priority. As publication of discoveries in the scientific and patent literature lags behind actual discoveries, we cannot be certain that we were the first to conceive of inventions covered by our pending patent applications or the first to file patent applications on such inventions. We also cannot be certain that our pending patent applications or those of our licensors will result in issued patents or that any issued patents will afford protection against a competitor. In addition, we cannot be certain that others will not obtain patents that we would need to license, circumvent or cease manufacturing and sales of products covered by these patents, nor can we be sure that licenses, if needed, would be available to us on favorable terms, if at all.

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We may incur substantial costs in defending our intellectual property and may not be successful in protecting our intellectual property and proprietary rights. Our success depends in part on our ability to protect our intellectual property and proprietary rights. We have obtained certain domestic and foreign patents and we intend to continue to seek patents on our inventions when appropriate. We also attempt to protect our proprietary information with contractual arrangements and under trade secret laws. Our employees and consultants generally enter into agreements containing provisions with respect to confidentiality and the assignment of rights to us for inventions made by them while in our employ or consulting for us. These measures may not adequately protect our intellectual property or proprietary rights. Existing trade secret, trademark and copyright laws afford only limited protection and our patents could be invalidated, held to be unenforceable or circumvented. Moreover, the laws of certain foreign countries in which our products are or may be manufactured or sold may not provide full protection of our intellectual property rights. Misappropriation of our technology and the costs of defending our intellectual property rights from misappropriation could substantially impair our business. If we are unable to protect our intellectual property or proprietary rights, our business may not be successful and the price of our common stock may decline.

We cannot be certain that foreign intellectual property laws will allow protection of our intellectual property rights or that others will not independently develop similar products, duplicate our products or design around any patents issued or licensed to us. Our products might infringe upon the patent rights of others, whether existing now or in the future. For the same reasons, the products of others could infringe upon our patent rights. We may be notified, from time to time, that we could be or we are infringing certain patents or other intellectual property rights of others. Litigation, which could be very costly and lead to substantial diversion of our resources, even if the outcome is favorable, may be necessary to enforce our patents or other intellectual property rights or to defend us against claimed infringement of the rights of others. These problems can be particularly severe in foreign countries. In the event of an adverse ruling in litigation against us for patent infringement, we might be required to discontinue the use of certain processes, and cease the manufacture, use, importation and/or sale of infringing products, expend significant resources to develop non-infringing technology or obtain licenses to patents of third parties covering the infringing technology. We cannot be certain that licenses will be obtainable on acceptable terms, if at all, or that damages for infringement will not be assessed or that litigation will not occur. The failure to obtain necessary licenses or other rights or litigation arising out of any such claims could adversely affect our ability to conduct our business as we presently conduct it and as we plan to conduct it in the future.

We also attempt to protect our proprietary information with contractual arrangements and under trade secret laws. We believe that our future success will depend primarily upon the technical expertise, creative skills and management abilities of our officers and key employees in addition to patent ownership. Our employees enter into agreements containing provisions with respect to confidentiality and assignment of rights to us for inventions made by them while in our employ. Agreements with consultants generally provide that rights to inventions made by them while consulting for us will be assigned to us unless the assignment of rights is prohibited by the terms of any of their prior agreements. Agreements with employees, consultants and collaborators contain provisions intended to further protect the confidentiality of our proprietary information. To date, we have had no experience in enforcing these agreements. We cannot be certain that these agreements will not be breached or that we would have adequate remedies for any breaches. Our trade secrets may not be secure from discovery or independent development by competitors, in which case we may not be able to rely on these trade secrets to prevent our competitors from using them.

Our products could infringe on the intellectual property rights of others. Companies in the wearable computing and display industries steadfastly pursue and protect their intellectual property rights. This has resulted in considerable and costly litigation to determine the validity and enforceability of patents and claims by third parties of infringement of patents or other intellectual property. Our products could be found to infringe on the intellectual property rights of others. Other companies may hold or obtain patents on inventions or other proprietary rights in technology necessary for our business. Periodically, companies inquire about our products and technology in their attempts to assess whether we violate their intellectual property rights. If we are forced to defend against patent infringement claims, we may face costly litigation, diversion of technical and management personnel, and product shipment delays, even if the allegations of infringement are unwarranted. If there are one or more successful claims of infringement against us and we are unable to develop non-infringing technology or license the infringed or similar technology on a timely basis, or if we are required to cease using one or more of our business or product names due to a successful trademark infringement claim against us, our business could be adversely affected. We are currently involved in an intellectual property dispute with Blue Radios, Inc., as described under Item 3. Legal Proceedings. If the outcome of such dispute is adverse to us, our business could be adversely affected.

Our business could suffer if we lose the services of, or fail to attract, key personnel. To continue to provide quality products in our rapidly changing business, we believe it is important to retain personnel with experience and expertise relevant to our business. Our success depends in large part upon a number of key management and technical employees. The loss of the

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services of one or more key employees, including Dr. John C.C. Fan, our President and Chief Executive Officer, could seriously impede our success. We do not maintain any “key-man” insurance policies on Dr. Fan or any other employees. In addition, due to the level of technical and marketing expertise necessary to support our existing and new customers, our success will depend upon our ability to attract and retain highly skilled management, technical, and sales and marketing personnel. Competition for highly skilled personnel is intense and there may be only a limited number of persons with the requisite skills to serve in these positions. Due to the competitive nature of the labor markets in which we operate, we may be unsuccessful in attracting and retaining these personnel. Our inability to attract and retain key personnel could adversely affect our ability to develop and manufacture our products.

Our customers who purchase display products for military applications typically incorporate our products into their products, which are sold to the U.S. government under contracts. U.S. government contracts generally are not fully funded at inception and may be terminated or modified prior to completion, which could adversely affect our business. Congress funds the vast majority of the federal budget on an annual basis, and Congress often does not provide agencies with all the money requested in their budget. Many of our customers' contracts cover multiple years and, as such, are not fully funded at contract award. If Congress or a U.S. government agency chooses to spend money on other programs, our customers' contracts may be terminated for convenience. Federal laws, collectively called the Anti-Deficiency Act, prohibit involving the government in any obligation to pay money before funds have been appropriated for that purpose, unless otherwise allowed by law. Therefore, the Anti-Deficiency Act indirectly regulates how the agency awards our contracts and pays our invoices. Federal government contracts generally contain provisions, and are subject to laws and regulations, that provide the federal government rights and remedies not typically found in commercial contracts, including provisions permitting the federal government to, among other provisions: terminate our existing contracts; modify some of the terms and conditions in our existing contracts; subject the award to protest or challenge by competitors; suspend work under existing multiple year contracts and related delivery orders; and claim rights in technologies and systems invented, developed or produced by us.

The federal government may terminate a contract with us or our customers either “for convenience” (for instance, due to a change in its perceived needs) or if we default due to our failure or the failure of a general or subcontractor to perform under the contract. If the federal government terminates a contract with one of our customers, our contract with our customers generally would entitle us to recover only our incurred or committed costs, settlement expenses and profit on the work completed prior to termination. However, under certain circumstances, our recovery costs upon termination for convenience of such a contract may be limited. As is common with government contractors, we have experienced occasional performance issues under some of our contracts. We may in the future receive show-cause or cure notices under contracts that, if not addressed to the federal government's satisfaction, could give the government the right to terminate those contracts for default or to cease procuring our services under those contracts.

In addition, U.S. government contracts and subcontracts typically involve long purchase and payment cycles, competitive bidding, qualification requirements, delays or changes in funding, extensive specification and performance requirements, price negotiations and milestone requirements. Each U.S. government agency often also maintains its own rules and regulations with which we must comply and which can vary significantly among agencies.

Most of our military sales are on a fixed-price basis, which could subject us to losses if there are cost overruns. Under a fixed-price contract, we receive only the amount indicated in the contract, regardless of the actual cost to produce the goods. While firm fixed-price contracts allow us to benefit from potential cost savings, they also expose us to the risk of cost overruns. If the initial estimates that we use to calculate the sales price and the cost to perform the work prove to be incorrect, we could incur losses. In addition, some of our contracts have specific provisions relating to cost, scheduling, and performance. If we fail to meet the terms specified in those contracts, then our cost to perform the work could increase, which would adversely affect our financial position and results of operations. Some of the contracts we bid on have “Indefinite Delivery, Indefinite Quantity” or IDIQ provisions. This means we are bidding a fixed price but are not assured of the quantity the government will buy or when it will buy during the term of the contract. This means we are exposed to the risk of price increases for labor, overhead and raw materials during the term of the contract. We may incur losses on fixed-price and IDIQ contracts that we had expected to be profitable, or such contracts may be less profitable than expected, which could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

If we fail to keep pace with changing technologies, we may lose customers. Rapidly changing customer requirements, evolving technologies and industry standards characterize our industries. To achieve our goals, we need to enhance our existing products and develop and market new products that keep pace with continuing changes in industry standards, requirements and customer preferences. We may be unable to bring to market technologies and products that are attractive to our customers, and as a result our business, financial condition and results of operations may be materially adversely affected.

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If we fail to comply with complex procurement laws and regulations, we could lose business and be liable for various penalties or sanctions. We must comply with laws and regulations relating to the formation, administration and performance of federal government contracts. These laws and regulations affect how we conduct business with our federal government customers. In complying with these laws and regulations, we may incur additional costs, and non-compliance may result in fines and penalties, including contractual damages. Among the more significant laws and regulations affecting our business are:

• The Federal Acquisition Regulation, which comprehensively regulates the formation, administration and performance of federal government contracts;

• The Truth in Negotiations Act, which requires certification and disclosure of all cost and pricing data in connection with contract negotiations;

• The Cost Accounting Standards and Cost Principles, which impose accounting requirements that govern our right to reimbursement under certain cost-based federal government contracts; and

• Laws, regulations and executive orders restricting the use and dissemination of information classified for national security purposes and the export of certain products, services and technical data. We engage in international work falling under the jurisdiction of U.S. export control laws. Failure to comply with these control regimes can lead to severe penalties, both civil and criminal, and can include debarment from contracting with the U.S. government.

Our contracting agency customers may review our performance under and compliance with the terms of our federal government contracts. If a government review or investigation uncovers improper or illegal activities, we may be subject to civil or criminal penalties or administrative sanctions, including:

• Termination of contracts;

• Forfeiture of profits;

• Cost associated with triggering of price reduction clauses;

• Suspension of payments;

• Fines; and

• Suspension or debarment from doing business with federal government agencies.

Additionally, the False Claims Act provides for substantial civil penalties where, for example, a contractor presents a false or fraudulent claim to the government for payment or approval. Civil actions under the False Claims Act may be brought by the government or by other persons on behalf of the government (who may then share a portion of any recovery).

If we fail to comply with these laws and regulations, we may also suffer harm to our reputation, which could impair our ability to win awards of contracts in the future or receive renewals of existing contracts. If we are subject to civil or criminal penalties and administrative sanctions or suffer harm to our reputation, our current business, future prospects, financial condition, or operating results could be materially harmed.

The U.S. government may also revise its procurement practices or adopt new contracting rules and regulations, including cost accounting standards, at any time. Any new contracting methods could be costly to satisfy, be administratively difficult for us to implement and could impair our ability to obtain new contracts.

A decline in the U.S. government defense budget, changes in spending or budgetary priorities, prolonged U.S. government shutdown or delays in contract awards may significantly and adversely affect our future revenues, cash flow and financial results. In recent years, U.S. government appropriations have been affected by larger U.S. government budgetary issues and related legislation. In 2011, Congress enacted the Budget Control Act of 2011 ("BCA"), which established specific limits on annual appropriations for fiscal years ("FY") 2012-2021 and has since been amended a number of times, most recently by the Bipartisan Budget Act of 2018 (“BBA18”). As a result, Department of Defense ("DoD") funding levels have fluctuated over this period and have been difficult to predict. Future spending levels are subject to a wide range of outcomes, depending on Congressional action. In addition, in recent years the U.S. government has been unable to complete its budget process before the end of its fiscal year, resulting in both a government shutdown and continuing resolutions to extend sufficient funds only for U.S. government agencies to continue operating. Most recently, the federal government was shut down due to lack of funding for over one month between late 2018 and early 2019. Additionally, the national debt has recently threatened to reach the statutory debt ceiling, and such an event in future years could result in the U.S. government defaulting on its debts.

As a result, defense spending levels are difficult to predict beyond the near-term due to numerous factors, including the external threat environment, future government priorities and the state of government finances. Significant changes in defense spending or changes in U.S. government priorities, policies and requirements could have a material adverse effect on our results of operations, financial condition or liquidity.

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Customer demands and new regulations related to conflict-free minerals may adversely affect us. The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) imposes new disclosure requirements regarding the use of “conflict” minerals mined from the Democratic Republic of Congo and adjoining countries in products, whether or not these products are manufactured by third parties. These requirements could affect the pricing, sourcing and availability of minerals used in the manufacture of semiconductor devices (including our products). We have incurred additional costs associated with complying with the disclosure requirements, such as costs related to determining the source of any conflict minerals used in our products. Our supply chain is complex and we may be unable to verify the origins for all metals used in our products. We purchase materials from foreign sources that may not cooperate and provide us with the necessary information to allow us to comply with the Dodd-Frank Act. This may require us to find alternative sources, which could delay product shipments. We may also encounter challenges with our customers and stockholders if we are unable to certify that our products are conflict-free.

Changes in tax laws, unfavorable resolution of tax examinations, or exposure to additional tax liabilities could have a material adverse effect on our results of operations, financial condition and liquidity. We are subject to taxes in the U.S., Korea, and the United Kingdom. Governments in the jurisdictions in which we operate implement changes to tax laws and regulations periodically. Any implementation of tax laws that fundamentally change the taxation of corporations in the U.S. or in the foreign jurisdictions in which we operate could materially affect our effective tax rate and could have a significant adverse impact on our financial results.

The 2017 United States Tax Cut and Jobs Act (“Tax Act”) significantly changed the taxation of U.S.-based multinational corporations. Our compliance with the Tax Act requires the use of estimates in our financial statements and exercise of significant judgment in accounting for its provisions. The implementation of the Tax Act requires interpretations and implementing regulations by the Internal Revenue Service, as well as state tax authorities. The legislation could be subject to potential amendments and technical corrections, any of which could materially lessen or increase certain adverse impacts of the legislation. As regulations and guidance evolve with respect to the Tax Act, and as we gather information and perform more analysis, our results may differ from previous estimates and may materially affect our financial position.

We may incur significant liabilities if we fail to comply with stringent environmental laws and regulations and the ITAR, or if we did not comply with these regulations in the past. We are subject to a variety of federal, state and local government regulations related to the use, storage, discharge and disposal of toxic or other hazardous chemicals used in our manufacturing process. We are also subject to federal ITAR laws that regulate the export of technical data and export of products to other nations that may use these products for military purposes. The failure to comply with present or future regulations could result in fines, suspension of production, or a cessation of operations. Any failure on our part to control the use of, or adequately restrict the discharge of, hazardous substances, or otherwise comply with environmental regulations, could subject us to significant future liabilities. Any failure on our part to obtain any required licenses for the export of technical data and/or export of our products or to otherwise comply with ITAR, could subject us to significant future liabilities. In addition, we cannot be certain that we have not violated applicable laws or regulations in the past, which violations could result in required remediation or other liabilities. We also cannot be certain that past use or disposal of environmentally sensitive materials in conformity with then existing environmental laws and regulations will protect us from required remediation or other liabilities under current or future environmental laws or regulations.

We may be unable to modify our products to meet regulatory or customer requirements. From time to time our display products are subject to new domestic and international requirements, such as the European Union's Restriction on Hazardous Substances ("RoHS") Directive. Our customers’ terms and conditions require us to be in compliance with “all laws.” If we are unable to comply with these regulations, we may not be permitted to ship our products, which would adversely affect our revenue and ability to maintain profitability. In addition, if we are found to be in violation of laws we may be subject to fines and penalties.

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We may be unable to successfully integrate new strategic acquisitions and investments, which could materially adversely affect our business, results of operations and financial condition. In the past we have made, and in the future we may make, acquisitions of, and investments in, businesses, products and technologies that could complement or expand our business. If we identify an acquisition candidate, we may not be able to successfully integrate the acquired businesses, products or technologies into our existing business and products. Future acquisitions could result in potentially dilutive issuances of equity securities, the incurrence of debt and contingent liabilities, amortization expenses and write-downs of acquired assets. In 2017, 2012 and 2011, we acquired 100% of the outstanding shares of NVIS, acquired 80% of the outstanding shares of eMDT Inc. and acquired 100% of the outstanding shares of FDD, respectively. If we are unable to operate eMDT, FDD and NVIS profitably, our results of operations will be negatively affected. We perform periodic reviews to determine if these investments are impaired, but such reviews are difficult and rely on significant judgment about the company’s technology, ability to obtain customers, and ability to become cash flow positive and profitable. We may take future impairment charges which will have an adverse impact of on our results of operations.

Additionally, we are a party to several joint ventures and investments where we may have some influence, but not complete control. Accordingly, we have limited control over their governance, financial reporting and operations. As a result, we face certain operating, financial and other risks relating to these investments, including risks related to the financial strength of our joint venture partners, having differing objectives from our partners, compliance risks relating to actions of the joint venture or our partners and the risk that we will be unable to resolve disputes with the joint venture partner. As a result, these investments may not contribute to our earnings or cash flows. In addition, these joint ventures may be required to raise additional capital, which may result in our ownership percentage being decreased.

Changes in China’s laws, legal protections or government policies on foreign investment in China may harm our business. Our business and corporate transactions, including operations through our joint ventures, are subject to laws and regulations applicable to foreign investment in China as well as laws and regulations applicable to foreign-invested enterprises. These laws and regulations frequently change, and their interpretation and enforcement involves uncertainties that could limit the legal protections available to us. Regulations and rules on foreign investments in China impose restrictions on the means that a foreign investor like us may apply to facilitate corporate transactions we may undertake. In addition, the Chinese legal system is based in part on government policies and internal rules, some of which are not published on a timely basis or at all, that may have a retroactive effect. As a result, we may not be aware of our violation of these policies and rules until sometime after the violation. If any of our past operations are deemed to be non-compliant with Chinese law, we may be subject to penalties and our business and operations may be adversely affected. For instance, under the catalogue for the Guidance of Foreign Investment Industries, some industries are categorized as sectors that are encouraged, restricted or prohibited for foreign investment. As the catalogue for the Guidance of Foreign Investment Industries is updated every few years, there can be no assurance that China’s government will not change its policies in a manner that would render part or all of our business to fall within the restricted or prohibited categories. If we cannot obtain approval from relevant authorities to engage in businesses that has become prohibited or restricted for foreign investors, we may be forced to sell or restructure such business. Furthermore, China’s government has broad discretion in dealing with violations of laws and regulations, including levying fines, revoking business and other licenses and requiring actions necessary for compliance. In particular, licenses and permits issued or granted to us by relevant governmental bodies may be revoked at a later time by higher regulatory bodies. If we are forced to adjust our corporate structure or business as a result of changes in government policy on foreign investment or changes in the interpretation and application of existing or new laws, our business, financial condition, results of operations and prospects may be harmed. Moreover, uncertainties in the Chinese legal system may impede our ability to enforce contracts with our business partners, customers and suppliers, or otherwise pursue claims in litigation to recover damages or loss of property, which could adversely affect our business and operations.

We have no present intention to pay dividends on our common stock in the foreseeable future and, consequently, your only opportunity to achieve a return on your investment during that time is if the price of our common stock appreciates. We have no present intention to pay dividends on our common stock in the foreseeable future. Historically, our earnings, if any, have been retained for the development of our businesses. Any recommendation by our Board to pay dividends will depend on many factors, including our financial condition, results of operations, and other factors. Accordingly, if the price of our common stock declines in the foreseeable future, you will incur a loss on your investment, without the likelihood that this loss will be offset in part or at all by potential future cash dividends.

Our stock price may be volatile in the future. The trading price of our common stock has been subject to wide fluctuations in response to quarter-to-quarter variations in results of operations, announcements of technological innovations or new products by us or our competitors, general conditions in the wireless communications, semiconductor and display markets, changes in earnings estimates by analysts or other events or factors. In addition, the public stock markets recently have experienced extreme price and trading volatility. This volatility has significantly affected the market prices of securities of

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many technology companies for reasons frequently unrelated to the operating performance of the specific companies. These broad market fluctuations may adversely affect the market price of our common stock.

Political and economic uncertainty in the European Union could adversely affect our business, results of operations, financial condition and prospects. Credit rating downgrades in certain European countries and/or speculation regarding changes to the composition or viability of the EU create uncertain global economic conditions. On June 23, 2016, the United Kingdom voted to leave the EU. The UK’s vote to voluntarily exit from the EU, generally referred to as the “Brexit,” triggered short-term financial volatility, including a decline in the value of the Great Britain Pound in comparison to both the U.S. dollar and the Euro. In addition, discussions and negotiations to determine the future terms of the UK’s relationship with the EU are ongoing, and the legal and regulatory framework that will be applicable in the UK may change. The ongoing uncertainty could have a negative economic impact and result in further volatility in the markets for several years. The impact of the Brexit referendum and such ongoing uncertainty may result in various economic and financial consequences for businesses operating in the UK, the EU and beyond. We hold significant assets in the UK and operate a UK subsidiary, and the future impacts of the Brexit and the continued uncertainty surrounding the EU could have a material impact on our business, financial condition, results of operations and cash flows.

Changes in government trade policies may increase the cost of our products, which may materially adversely affect our sales or profitability. We depend on Chinese, Taiwanese, and Korean foundries for the manufacture of integrated circuits for our Display products. The U.S. and China have recently engaged in trade negotiations, the outcome of which remains uncertain. In 2018, the U.S. proposed, among other actions, imposing new or higher tariffs on specified imported products originating from China in response to what it characterizes as unfair trade practices, and China has responded by proposing new or higher tariffs on specified products imported from the U.S. In notices published on April 6, 2018 and June 20, 2018, the Office of the United States Trade Representative issued a determination and requests for public comment under Section 301 under the Trade Act of 1974 (the “Notices”) concerning the proposed imposition of an additional 25% tariff on specified products from China, which products comprised approximately $50.0 billion in estimated annual trade value for calendar year 2018. The list of products set forth in the Notices included diodes, integrated circuits and other products that we import from China as part of our supply chain. Tariffs on components that we import from China or other nations that have imposed, or may in the future impose, tariffs would cause our expenses to increase, which would adversely affect our profitability unless we were able to exclude our products from the tariffs or we raise prices for our products, which may result in our products becoming less attractive relative to products offered by our competitors. In addition, future actions or escalations by either the U.S. or China that affect trade relations may also affect our business or that of our suppliers or customers, and we cannot provide any assurances as to whether such actions will occur or the form that they may take. Moreover, it is uncertain to what extent, if any, the U.S. tariffs on components that we import from China will affect the Taiwanese foundries on which we depend, in part because many Taiwanese foundries conduct parts of their manufacturing in China.

A protectionist trade environment in either the U.S. or those foreign countries in which we do business, such as a change in the current tariff structures, export compliance or other trade policies, may materially adversely affect our ability to sell our products in foreign markets. To the extent that our sales or profitability are affected negatively by any such tariffs or other trade actions, our business and results of operations may be materially adversely affected.

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Part II

Item 6. Selected Financial Data (As Revised)⁽¹⁾

This information should be read in conjunction with our consolidated financial statements and notes thereto, and our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 7 of this Form 10-K/A.

	Fiscal Year Ended
(in thousands, except per share data)	2018 (2)			2017			2016			2015			2014
Statement of Operations Data:
Total revenues	$	24,465		$	27,841		$	22,643		$	32,054		$	31,808
Loss from operations	(39,967		)	(30,298		)	(20,473		)	(25,237		)	(28,429		)
Total non-operating income (expense), net	5,514			1,955			571			10,416			(36		)
Tax benefit (provision)	(30		)	2,963			(3,130		)	25			180
Net loss	(34,482		)	(25,380		)	(23,031		)	(14,843		)	(28,671		)
Net loss attributable to the controlling interest	(34,534		)	(25,240		)	(23,569		)	(14,693		)	(28,212		)
Basic and diluted loss per share attributable to Kopin Corporation common stockholders	$	(0.47	)	$	(0.36	)	$	(0.37	)	$	(0.23	)	$	(0.45	)
Weighted average basic and diluted common shares outstanding	73,157			69,915			64,046			63,466			62,639

	Fiscal Year Ended
(in thousands)	2018 (2)		2017		2016		2015		2014
Balance Sheet Data:
Cash and cash equivalents and marketable debt securities	$	37,244	$	68,756	$	77,198	$	80,711	$	90,859
Working capital	39,037		67,636		70,028		89,879		86,682
Total assets	59,549		91,322		87,832		106,060		122,941
Long-term obligations	1,469		1,839		247		298		311
Total stockholders’ equity	$	47,862	$	77,380	$	72,742	$	93,539	$	109,847

(1) For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements.

(2) Effective December 31, 2017, the first day of fiscal year 2018, the Company adopted Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) on a modified retrospective basis. As a result of the adoption of this standard, Total revenues, Loss from operations and Total stockholders' equity for fiscal year 2018 in the preceding tables may not be directly comparable to those of prior years. For additional information, refer to Note 1. of the “Notes to Consolidated Financial Statements.”

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations (As Revised)

Overview

The following discussion should be read in conjunction with our consolidated financial statements and notes to those statements and other financial information appearing elsewhere in this Form 10-K/A. The following discussion contains forward-looking statements. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of a number of factors, including the risks discussed in Item 1A “Risk Factors,” and elsewhere in this Form 10-K/A. Please refer to our cautionary note on Forward Looking Statements on page 3 of this Form 10-K/A.

Management's discussion and analysis of our financial condition and results of operations are based upon our audited consolidated financial statements. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition under the percentage-of-completion method, bad debts, inventories, warranty reserves, investment valuations, valuation of stock compensation awards, recoverability of deferred tax assets, liabilities for uncertain tax positions and contingencies. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for judgments about carrying values of assets and liabilities that are not apparent from other sources. Actual results may differ from these estimates under different assumptions.

We adopted the Financial Accounting Standards Board’s ("FASB") Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) effective December 31, 2017 (the first day of our fiscal year 2018) and applied the modified retrospective method. Our results for reporting periods beginning after December 31, 2017 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported in accordance with our historic accounting policies ASC 605. We believe the following critical accounting policies are most affected by our more significant judgments and estimates used in the preparation of our consolidated financial statements:

Revenue Recognition

Substantially all of our product revenues are either derived from the sales of components for use in military applications or our wearable technology components that can be integrated to create industrial and consumer headset systems. We also have development contracts for the design, manufacture and modification of products for the U.S. government or a prime contractor for the U.S. government or for a customer that sells into the industrial or consumer markets. The Company's contracts with the U.S. government are typically subject to the Federal Acquisition Regulations ("FAR") and are priced based on estimated or actual costs of producing goods. The FAR provides guidance on the types of costs that are allowable in establishing prices for goods provided under U.S. government contracts. The pricing for non-U.S. government contracts is based on the specific negotiations with each customer.

Our fixed-price contracts with the U.S. government or other customers may result in revenue recognized in excess of amounts currently billed. We disclose the excess of revenues over amounts actually billed as Contract assets and unbilled receivables on the balance sheet. Amounts billed and due from our customers are classified as Accounts receivable on the balance sheets. In some instances, the U.S. government retains a small portion of the contract price until completion of the contract. The portion of the payments retained until final contract settlement is not considered a significant financing component because the intent is to protect the customer. For contracts with the U.S. government, we typically receive interim payments either as work progresses or by achieving certain milestones or based on a schedule in the contract. We recognize a liability for these advance payments in excess of revenue recognized and present it as Contract liabilities and billings in excess of revenue earned on the balance sheets. The advanced payment typically is not considered a significant financing component because it is used to meet working capital demands that can be higher in the early stages of a contract and to protect us from the other party failing to adequately complete some or all of its obligations under the contract. For industrial and consumer purchase orders, we typically receive payments within 30 to 60 days of shipments of the product, although for some purchase orders, we may require an advanced payment prior to shipment of the product.

To determine the proper revenue recognition method for contracts with the same customer, we evaluate whether two or more contracts should be combined and accounted for as one single contract and whether the combined or single contract should be accounted for as more than one performance obligation. For most of our development contracts and contracts with the U.S. government, the customer contracts with us to provide a significant service of integrating a set of components into a single unit. Hence, the entire contract is accounted for as one performance obligation. Less frequently, however, we may promise to provide distinct goods or services within a contract in which case we separate the contract into more than one performance obligation. If a contract is separated into more than one performance obligation, we allocate the total transaction

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price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. In cases where we sell standard products, the observable standalone sales are used to determine the standalone selling price.

The Company recognizes revenue from a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.

Commencing in 2018 for certain contracts with the U.S. government, the Company recognizes revenue over time as we perform because of continuous transfer of control to the customer and the lack of an alternative use for the product. The continuous transfer of control to the customer is supported by liability clauses in the contract that allow the U.S. government to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. For contracts with commercial customers, while the contract may have a similar liability clause, our products historically have an alternative use and thus, revenue is recognized at a point in time.

In situations where control transfers over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. We generally use the cost-to-cost approach to measure the extent of progress towards completion of the performance obligation for our contracts because we believe it best depicts the transfer of assets to the customer. Under the cost-to-cost measure approach, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recorded proportionally as costs are incurred.

Accounting for design, development and production contracts requires judgment relative to assessing risks, estimating contract revenues and costs, and making assumptions for schedule and technical issues. Due to the size and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. We have to make assumptions regarding the number of labor hours required to complete a task, the complexity of the work to be performed, the availability and cost of materials, and performance by our subcontractors. For contract change orders, claims or similar items, we apply judgment in estimating the amounts and assessing the potential for realization. These amounts are only included in contract value when they can be reliably estimated and realization is considered probable. If our estimate of total contract costs or our determination of whether the customer agrees that a milestone is achieved is incorrect, our revenue could be overstated or understated and the profits or loss reported could be subject to adjustment.

For our commercial customers, the Company's revenue is recognized when obligations under the terms of a contract with our customer is satisfied and the Company transfers control of the products or services, which is generally upon delivery to the customer. Revenue is recorded as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Provisions for product returns and allowances are reductions in the transaction price and are recorded in the same period as the related revenues. We analyze historical returns, current economic trends and changes in customer demand when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for stocking of inventory. Sales, value add and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.

The rights and benefits to the Company's intellectual property are conveyed to certain customers through technology license agreements. These agreements may include other performance obligations including the sale of product to the customer. When the license is distinct from other obligations in the agreement, the Company treats the license and other performance obligations as separate performance obligations. Accordingly, the license is recognized at a point in time or over time based on the standalone selling price. The sale of materials is recognized at a point in time, which occurs with the transfer of control of the Company's products or services. In certain instances, the Company is entitled to sales-based royalties under license agreements. These sales-based royalties are recognized when they are earned. Revenues from sales-based royalties under license agreements are shown under Research and development and other revenues on the Company's Consolidated Statements of Operations.

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Inventory

We provide a reserve for estimated obsolete or unmarketable inventory based on assumptions about future demand and market conditions and our production plans. Inventories that are obsolete or slow moving are generally fully reserved (representing the estimated net realizable value) as such information becomes available. Our display products are manufactured based upon production plans whose critical assumptions include non-binding demand forecasts provided by our customers, lead times for raw materials, lead times for wafer foundries to perform circuit processing and yields. If a customer were to cancel an order or actual demand was lower than forecasted demand, we may not be able to sell the excess display inventory and additional reserves would be required. If we were unable to sell the excess inventory, we would establish reserves to reduce the inventory to its estimated realizable value (generally zero).

Investment Valuation

We periodically make equity investments in private companies, accounted for as an equity investment, whose values are difficult to determine. The Company adopted ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities and the related amendments on December 31, 2017. This update amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The Company adopted the measurement alternative for equity investments without readily determinable fair values (often referred to as cost method investments) on a prospective basis. When assessing investments in private companies for impairment, we consider such factors as, among others, the share price from the investee's latest financing round, the performance of the investee in relation to its own operating targets and its business plan, the investee's revenue and cost trends, the liquidity and cash position, including its cash burn rate and market acceptance of the investee's products and services. Because these are private companies which we do not control we may not be able to obtain all of the information we would want in order to make a complete assessment of the investment on a timely basis. Accordingly, our estimates may be revised if other information becomes available at a later date.

In addition to the above, we make investments in government and agency-backed securities and corporate debt securities. For all of our investments we provide for an impairment valuation if we believe a decline in the value of an investment is other-than-temporary, which may have an adverse impact on our results of operations. The determination of whether a decline in value is other-than-temporary requires that we estimate the cash flows we expect to receive from the security. We use publicly available information such as credit ratings and financial information of the entity that issued the security in the development of our expectation of the cash flows to be received. Historically, we have periodically recorded other than temporary impairment losses, however we have not done so recently.

Income Taxes

We have historically incurred domestic operating losses from both a financial reporting and tax return standpoint. We establish valuation allowances if it appears more likely than not that our deferred tax assets will not be realized. These judgments are based on our projections of taxable income and the amount and timing of our tax operating loss carryforwards and other deferred tax assets. Given our federal operating tax loss carryforwards, we do not expect to pay domestic federal taxes in the near term. It is possible that we could pay foreign and state income taxes. We are also subject to foreign taxes from our Korean and U.K. subsidiary operations.

Our income tax provision is based on calculations and assumptions that will be subject to examination by tax authorities. Despite our history of operating losses there can be exposures for state taxes, federal alternative minimum taxes or foreign tax that may be due. We regularly assess the potential outcomes of these examinations and any future examinations for the current or prior years in determining the adequacy of our provision for income taxes. Should the actual results differ from our estimates, we would have to adjust the income tax provision in the period in which the facts that give rise to the revision become known. Such adjustment could have a material impact on our results of operations. We have historically established valuation allowances against all of our net deferred tax assets because of our history of generating operating losses and restrictions on the use of certain items. Our evaluation of the recoverability of deferred tax assets has also included analysis of the expiration dates of net operating loss carryforwards. In forming our conclusions as to whether the deferred tax assets are more likely than not to be realized we consider the sources of our income and the projected stability of those sources and product life cycles.

On December 22, 2017, the President signed the Tax Cuts and Jobs Act of 2017 (2017 Act) which enacted a wide range of changes to the U.S. corporate income tax system. The 2017 Act reduced the U.S. corporate statutory federal tax rate to 21% effective in 2018, eliminated the domestic manufacturing deduction benefit and introduced other tax base broadening measures, changed rules for expensing and capitalizing business expenditures, established a territorial tax system for foreign earnings as well as a minimum tax on certain foreign earnings, provided for a one-time transition tax on previously

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undistributed foreign earnings, and introduced new rules for the treatment of certain foreign income. Also on December 22, 2017, the SEC issued Staff Accounting Bulletin No. 118 ("SAB 118"), which provided companies with additional guidance on how to account for the 2017 Act in their financial statements, allowing companies to use a measurement period. As of December 30, 2017, we made a reasonable estimate of the effects on our existing deferred tax balances and the one-time transition tax on previously undistributed foreign earnings and the Company did not recognize any provisional amounts in the (benefit) provision for income taxes in accordance with SAB 118. As of December 29, 2018, we had finalized our provisional estimates for the remeasurement of our existing U.S. deferred tax balances and the one-time transition tax and did not recognize amounts in the (benefit) provision for income taxes. Please see the “Notes to Consolidated Financial Statements” for additional information.

Goodwill

We account for goodwill in accordance with ASC Topic 350. Under ASC Topic 350, goodwill is considered to have an indefinite life, and is carried at cost. Goodwill is not amortized, but is subject to an annual impairment test, as well as between annual tests when events or circumstances indicate that the carrying value may not be recoverable.

The determination of reporting units under ASC 350 begins with the definition of an operating segment in ASC 280 and takes into account the disaggregation of that operating segment into economically dissimilar components for goodwill impairment testing purposes. The level at which operating performance is reviewed also differs between ASC 280 and ASC 350. The chief operating decision maker ("CODM") is the Company's Chief Executive Officer who reviews operating segments and the segment manager reviews reporting units (components of operating segments). Therefore, a component of an operating segment would not be considered an operating segment under ASC 280 unless the CODM regularly reviews its operating performance. However, that same component might be a reporting unit under ASC 350 if a segment manager regularly reviews its operating performance (and if the other reporting unit criteria are met). Goodwill is evaluated for impairment annually or more often if indicators of a potential impairment are present. The Company performs impairment tests of goodwill at its reporting unit level. The goodwill valuations that are utilized to test these assets for impairment are depending on a number of significant estimates and assumptions, including macroeconomic conditions, overall growth rates, competitive activities, cost containment, Company business plans and the discount rate applied to cash flows. We believe these estimates and assumptions are reasonable and are comparable to those that would be used by other market participants. However, actual events and results could differ substantially from those used in our valuations. To the extent such factors result in a failure to achieve the level of projected cash flows initially used to estimate fair value for purposes of establishing the carrying amount of goodwill and intangibles, we may need to record non-cash impairment charges in the future.  

Results of Operations

We are a leading developer, manufacturer and seller of miniature displays, optical lenses, ASICs (our “components”) for sale as individual components or in headsets we design and sell or license. Our component products are used in highly demanding high-resolution portable military, enterprise and consumer electronic applications, training and simulation equipment and 3D metrology equipment. Our products enable our customers to develop and market an improved generation of products for these target applications.

We have two principal sources of revenues: product revenues and research and development revenues. Research and development revenues consist primarily of development contracts with agencies or prime contractors of the U.S. government and commercial enterprises.

We manufacture transmissive microdisplays and reflective microdisplays. Our commercial and military transmissive display production is being performed entirely in our Westborough, Massachusetts facility. FDD, our wholly-owned subsidiary, manufactures our reflective microdisplays in its facility located in Scotland and it is a reportable segment. In 2017, we introduced Organic Light Emitting Diode (“OLED”) displays which are designed by us and manufactured by third parties for us.

We are in the initial production phase as the display supplier for the U.S. Army’s Family of Weapon Sights (“FWS”) - Individual program and undergoing qualification for the FWS - Crew Served variant. We are also in development for a new series of displays for the M1A2 program. The FWS, M1A2 and our existing production avionic programs are expected to increase production for the next several years. There are other firms offering products which compete against us in the military programs and all of the programs we supply product to are subject to the U.S. government military budget and procurement process. Accordingly, there can be no assurances we will continue to ship under our military contracts.

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Sales of our products to customers that use our products for Consumer Applications is a critical part of our strategy to increase revenues and return to profitability and positive cash flow. Our success in selling our products for Consumer Applications will depend on the demand for our customers’ new products, which we are unable to predict.

We offer microdisplays, optical lenses, ASICs, backlights, and Whisper™ audio chips for use in consumer, enterprise and public safety products and systems which are targeted at augmented and virtual reality markets, among other areas. We refer to the sale of microdisplays, optical lenses, ASICs, backlights, and Whisper™ audio chips as our component sales. We also offer head mounted, voice and gesture controlled, hands-free headset system designs that include our components and software for consumer and enterprise applications. The software technology includes but is not limited to voice and gesture control, noise cancellation, and operating systems. We refer to our components and system designs as Kopin Wearable technologies. Our strategy is to sell the components individually or license the headset system designs and sell the various components included in the reference design as part of a supply agreement. Some of the technologies included in our concept systems are components and software that we license from other companies. We believe our ability to develop and expand Kopin Wearable technologies and to market and license our concept systems and components will be critical for us to achieve revenue growth, positive cash flow and profitability. The markets Kopin Wearable technologies can already be used in have a number of existing product offerings such as ruggedized laptop computers and tablets and virtual reality headsets offered by companies such as Samsung, Sony and Oculus. The companies that offer these products are significantly larger than we are.

Because our fiscal year ends on the last Saturday of December every seven years we have a fiscal year with 53 weeks. Our fiscal year 2018 was a 52 week year, 2017 was a 52 week year and 2016 was a 53 week year. The impact of the 53^rd week in 2016 fiscal year was not material to the Company's results of operations.

Revenues.    Our revenues by display application, which include product sales and amounts earned from research and development contracts, for fiscal years 2018, 2017 and 2016 by category, were as follows:

(In thousands)	2018		2017		2016
Military	$	8,724	$	13,438	$	5,338
Industrial	6,066		5,478		6,296
Consumer	4,146		4,406		7,418
Research and Development	5,254		2,947		1,527
Other	275		1,573		2,064
Total Revenues	$	24,465	$	27,841	$	22,643

Fiscal Year 2018 Compared to Fiscal Year 2017

Sales of our products for Military applications include systems used by the military both in the field and for training and simulation. Sales of our products for Military applications may be for a one-time purchase order or for programs that run for several years. The decrease in sales of products for Military applications in 2018 compared to 2017 was primarily due to the completion of military programs at our subsidiary NVIS in 2017.

Industrial applications revenues represent customers who purchase our display products for use in headsets used for applications in manufacturing, distribution, public safety, 3D metrology equipment and other industrial applications. Our 3D metrology customers are primarily located in Asia and they sell to Asian contract manufacturers who use the 3D metrology machines for quality control purposes. The increase in Industrial applications in 2018 compared to 2017 was primarily due to an increase in sales to customers who use our display components in industrial headsets.

Sales of our displays for Consumer applications is primarily for the use in thermal imaging products, recreational rifle and hand-held scopes and drone racing headsets. The decrease in Consumer applications in 2018 compared to 2017 was primarily due to decreased demand for displays and components used in thermal imaging products and drone racing headsets.

Research & Development ("R&D") revenues increased in 2018 as compared to 2017 primarily due to funding for U.S. military programs.

Historically, we have recognized revenue in the period when we have shipped units of products. For the fiscal year 2018, we adopted Topic 606 and certain revenues are being recorded on the percentage of completion method using a cost-to-cost approach. Prior to the adoption of Topic 606, we believe we would have recorded approximately $4.1 million as revenue in 2018 and future years, however, with our adoption of Topic 606 the approximately $4.1 million was recognized as part of the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings. The comparative information has not been revised and continues to be reported under the accounting standards in effect for

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those periods. The Company expects the impact of the adoption of the new standard to be material to the Company's revenues on an ongoing basis.

International sales represented approximately 41% of product revenues for 2018 and 2017, respectively. Our international sales are primarily denominated in U.S. currency. Consequently, a strengthening of the U.S. dollar could increase the price in local currencies of our products in foreign markets and make our products relatively more expensive than competitors' products that are denominated in local currencies, which could result in a reduction in sales or profitability in those foreign markets. As a result, our financial position and results of operations are subject to exchange rate fluctuation in transactional and functional currency. We have not taken any protective measures against exchange rate fluctuations, such as purchasing hedging instruments with respect to such fluctuations, because of the historically stable exchange rate between the Japanese yen, Great Britain pound and the U.S. dollar. Foreign currency translation impact on our results, if material, is described in further detail under "Item 7A. Quantitative and Qualitative Disclosures About Market Risk" section below.

Fiscal Year 2017 Compared to Fiscal Year 2016

The increase in Military Application revenues in 2017 as compared to 2016 is primarily due to incremental revenue from NVIS, who produces virtual reality systems for professional 3D applications. Revenues from NVIS were approximately $9.1 million, of which $8.8 million is included in Military Applications.

Revenues from NVIS of approximately $0.3 million are included in the Industrial applications. Our 3D metrology customers are primarily located in Asia and Chinese contract manufacturers represent a significant market for 3D metrology equipment. Accordingly, sales of 3D metrology equipment are tied to the strength of the Chinese manufacturing sector.

The decrease in Consumer Applications revenues in 2017 as compared to 2016 is primarily because of a decrease in sales to customers who use our products for drone headset applications and a health and fitness application.

Research & Development ("R&D") revenues increased in 2017 as compared to 2016 primarily due to funding for U.S. military programs including the Family of Weapon Sights ("FWS") program.

International sales represented 41% and 59% of product revenues for fiscal years 2017 and 2016, respectively. Our international sales are primarily denominated in U.S. currency.

Cost of Product Revenues.    Cost of product revenues, which is comprised of materials, labor and manufacturing overhead related to the production of our products for fiscal years 2018, 2017 and 2016 were as follows:

(In thousands, except percentages)	2018			2017			2016
Cost of product revenues	$	15,831		$	18,118		$	17,814
Cost of product revenues as a % of net product revenues	82.4		%	72.8		%	84.4		%

Fiscal Year 2018 Compared to Fiscal Year 2017

Cost of product revenues increased as a percentage of revenues in 2018 as compared to 2017 because of a decline in sales of our military products, which have higher gross margins than the average gross margin of our other products sold during the same period in 2017.

Fiscal Year 2017 Compared to Fiscal Year 2016

Cost of product revenues decreased as a percentage of revenues in 2017 as compared to 2016 because of an increase in sales of our military products which have higher gross margins than the other products sold during the same period in 2016.

Research and Development.    R&D expenses are incurred in support of internal display development programs or programs funded by agencies or prime contractors of the U.S. government and commercial partners. R&D costs include staffing, purchases of materials and laboratory supplies, circuit design costs, fabrication and packaging of display products, and overhead. In fiscal year 2019, we expect our R&D expenditures to be related to our display products and military systems. R&D expenses for fiscal years 2018, 2017 and 2016 were as follows:

(In thousands)	2018		2017		2016
Funded	$	4,892	$	3,365	$	787
Internal	12,553		15,415		15,253
Total	$	17,445	$	18,780	$	16,040

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Fiscal Year 2018 Compared to Fiscal Year 2017

Funded R&D expense for 2018 increased as compared to the prior year due to an increase in spending for military programs. Internal R&D expense for 2018 decreased as compared to the prior year primarily due to products moving into the commercialization phase. We expect to incur significant development costs in fiscal year 2019 to develop display products and develop military products.

Fiscal Year 2017 Compared to Fiscal Year 2016

Funded R&D expense for 2017 increased as compared to the prior year due to an increase in spending for military programs. Internal R&D expense for 2017 remained relatively consistent as compared to prior year.

Selling, General and Administrative.    Selling, general and administrative ("S,G&A") expenses consist of the expenses incurred by our sales and marketing personnel and related expenses, and administrative and general corporate expenses. S,G&A expenses for the fiscal years 2018, 2017 and 2016 were as follows:

(In thousands, except percentages)	2018			2017			2016
Selling, general and administrative expense	$	27,211		$	20,541		$	16,962
Selling, general and administrative expense as a % of total revenue	111.2		%	73.8		%	74.9		%

Fiscal Year 2018 Compared to Fiscal Year 2017

S,G&A for 2018 increased as compared to the prior year primarily due to an increase in compensation expenses including increases of $2.6 million in non-cash stock-based compensation, $1.3 million in product promotion, $0.8 million of accrued contingent consideration and $0.8 million of legal expenses and patent maintenance cost.

Fiscal Year 2017 Compared to Fiscal Year 2016

S,G&A for 2017 increased as compared to the prior year, reflecting incremental S,G&A of $1.4 million from our acquisition of NVIS and a $1.5 million increase in professional fees. The incremental S,G&A from NVIS for 2017 primarily relates to the amortization of intangibles resulting from the acquisition.

Impairment of Goodwill and Intangibles. Goodwill and intangibles are evaluated for impairment annually or more often if indicators of a potential impairment are present. Our annual impairment testing of goodwill is performed separately from our impairment testing of intangibles. The Company performs impairment tests of goodwill at its reporting unit level. The goodwill valuations that are utilized to test these assets for impairment are depending on a number of significant estimates and assumptions, including macroeconomic conditions, overall growth rates, competitive activities, cost containment, Company business plans and the discount rate applied to cash flows. We believe these estimates and assumptions are reasonable and are comparable to those that would be used by other market participants. Impairment of goodwill for the fiscal years 2018, 2017 and 2016 were as follows:

(In thousands)	2018		2017		2016
Impairment of goodwill	$	1,417	$	600	$	—

During fiscal 2018, we recognized a $1.4 million goodwill impairment charge related to our NVIS reporting unit and our Kopin Software Ltd. reporting unit. During fiscal year 2017, we recognized a $0.6 million goodwill impairment charge related to our NVIS reporting unit. See Note 5 of the "Notes to Consolidated Financial Statements" for more information.

Impairment of Assets. The Company periodically reviews the carrying value of its long-lived assets to determine if facts and circumstances suggest that they may be impaired or that the amortization or depreciation period may need to be changed. The carrying value of a long-lived asset is considered impaired when the anticipated identifiable undiscounted cash flows from such asset are less than its carrying value. For assets that are to be held and used, impairment is measured based upon the amount by which the carrying amount of the asset exceeds its fair value. Impairment of assets for the fiscal years 2018, 2017 and 2016 were as follows:

(In thousands)	2018		2017		2016
Impairment of assets	$	2,527	$	—	$	—

During fiscal 2018, we recognized a $2.5 million asset impairment charge related to equipment as discussed further in Note 2. of the "Notes to Consolidated Financial Statements."

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Total Other Income (Expense), Net. Other income (expense), net, is primarily composed of interest income, foreign currency transaction, remeasurement gains and losses incurred by our Korean and UK-based subsidiaries and other non-operating income items. Other income (expense), net, for the fiscal years 2018, 2017 and 2016 were as follows:

	2018		2017		2016
(In thousands)	As Revised (1)
Total other income (expense), net	$	5,514	$	1,955	$	571

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

Fiscal Year 2018 Compared to Fiscal Year 2017

In 2018 we recorded $1.2 million of foreign currency gains compared to $1.0 million of foreign currency losses recorded in 2017. In 2018, we recorded a non-cash $2.8 million gain on equity investments. In 2018, the Company received $1.0 million of insurance proceeds related to the embezzlement at our Korean subsidiary. In 2017, we recorded a non-cash $2.0 million gain on the fair value adjustment of a warrant we received as part of a license of our technology.

Fiscal Year 2017 Compared to Fiscal Year 2016

In 2017 and 2016, we recorded $1.0 million and $0.7 million of foreign currency losses, respectively. In 2017, we recorded a non-cash $2.0 million gain on the fair value adjustment of a warrant we received as part of a license of our technology. In 2016, we recorded a final additional gain of $1.0 million on the sale of our investment in Recon as a result of the release of amounts which were held in escrow at the time of the sale.

Tax benefit (provision)

(In thousands)	2018			2017		2016
Tax (provision) benefit	$	(30	)	$	2,963	$	(3,130	)

Fiscal Year 2018 Compared to Fiscal Year 2017

The provision for income taxes for the fiscal year ended 2018 of less than $0.1 million was due to a change in estimates related to uncertain tax positions and deferred tax liabilities for the Company's former Korean subsidiary. The benefit for income taxes for the fiscal year ended 2017 of $3.0 million was driven by a reduction in foreign tax expense for the rate difference on a dividend distribution from the Company's Korean subsidiary of $0.8 million, an increase of uncertain tax positions of $0.2 million, the recognition of $1.1 million of net deferred tax liabilities in connection with the NVIS acquisition, which provided evidence of recoverability of the Company's net deferred tax assets that previously carried a full valuation allowance and resulted in a reduction in the valuation allowance of $1.1 million, a $1.0 million AMT credit that is expected to be refunded in the future and $0.3 million tax benefit related to the Kowon embezzlement loss.

For 2019, we expect to have movement in the foreign withholding tax relating to conversion rate changes. We also expect to have a state tax provision in 2019.

Fiscal Year 2017 Compared to Fiscal Year 2016

The benefit for income taxes for the fiscal year ended 2017 of $3.0 million was driven by a reduction in foreign tax expense for the rate difference on a dividend distribution from the Company's Korean subsidiary of $0.8 million, an increase of uncertain tax positions of $0.2 million, the recognition of $1.1 million of net deferred tax liabilities in connection with the NVIS acquisition provided evidence of recoverability of the Company's net deferred tax assets that previously carried a full valuation allowance and resulted in a reduction in the valuation allowance of $1.1 million, a $1.0 million AMT credit that is expected to be refunded in the future and $0.3 million tax benefit related to the Kowon embezzlement loss. The provision for income taxes for the fiscal year ended 2016 of $3.1 million represents $0.1 million of state tax, $1.0 million of tax for gain on sale of the Korean subsidiary’s building, $0.7 million for uncertain tax position, which includes potential interest and penalties of $0.3 million, and foreign withholding of $1.4 million.

Net (income) loss attributable to noncontrolling interest.    As of December 29, 2018, we owned 80% of the equity of eMDT. Net loss attributable to noncontrolling interest on our consolidated statement of operations represents the portion of the results of operations of our majority owned subsidiaries which is allocated to the shareholders of the equity interests not owned by us. The change in net (income) loss attributable to noncontrolling interest in 2017 compared to 2016 is the result of the change in the results of operations of Kowon and eMDT. The change in net (income) loss attributable to noncontrolling interest

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in 2016 compared to 2015 is the result of the change in the results of operations of Kowon and eMDT and for the period of time during 2015 when we owned 58% of Kopin Software Ltd.

Liquidity and Capital Resources

At December 29, 2018 and December 30, 2017, we had cash and cash equivalents and marketable securities of $37.2 million and working capital of $39.0 million compared to $68.8 million and $67.6 million, respectively. The change in cash and cash equivalents and marketable securities was primarily due to net outflow of cash used in operating activities of $28.1 million, which was partially offset by net inflow of cash provided by investing activities of $18.8 million. 

At December 30, 2017 and December 31, 2016, we had cash and cash equivalents and marketable debt securities of $68.8 million and working capital of $67.6 million compared to $77.2 million and $70.0 million, respectively. The change in cash and cash equivalents and marketable securities was primarily due to net outflow of cash used in operating activities of $25.9 million and acquisition of a company for $3.7 million, offset by cash provided by the sale of 7.6 million shares of treasury stock for $24.7 million.

Cash and cash equivalents and marketable debt securities held in U.S. dollars at:

	December 29, 2018		December 30, 2017
Domestic locations	$	36,182,663	$	55,488,190
Foreign locations	418,339		6,110,496
Subtotal cash and cash equivalents and marketable debt securities held in U.S. dollars	36,601,002		61,598,686
Cash and cash equivalents held in other currencies and converted to U.S. dollars	643,361		7,156,998
Total cash and cash equivalents and marketable debt securities	$	37,244,363	$	68,755,684

We have no plans to repatriate the cash and cash equivalents held in our foreign subsidiary FDD and subsequent to year end we stopped operations at Kopin Software Ltd. which had no excess cash and, as such, we have not recorded any deferred tax liability with respect to such cash. The manufacturing operations at our Korean facility, Kowon, have ceased and Kowon was liquidated at fiscal year ended 2018. The Company has approximately $0.4 million of cash and cash equivalents in Korea at December 29, 2018, in the event of any tax liabilities are identified. The Company has recorded deferred tax liabilities for any additional withholding tax that may be due to the Korean government upon Kowon's final tax return acceptance.

In March 2017, we purchased 100% of the outstanding stock of NVIS for $3.7 million. We expect to pay approximately $1.3 million in March 2019 and may be required to pay up to and additional $0.7 million if certain future operating performance milestones are met and the selling shareholders remain employed with NVIS through March 2020. As there is a requirement to remain employed to earn the contingent payments, these contingent payments will be treated as compensation expense.

We expect to expend between $1.5 million and $2.0 million on capital expenditures over the next twelve months.

The Company has entered into an agreement to make a capital contribution of approximately $5.1 million (the Company's capital contribution under the agreement is $35.0 million Chinese Yuan Renminbi). The Company’s ability to make its capital contribution is subject to Chinese laws which include restrictions of direct foreign investment. Accordingly, the Company will need to make the capital contribution through its Chinese subsidiary’s operations.

The Company has incurred net losses of $34.5 million, $25.4 million and $23.0 million for the fiscal years ended 2018, 2017 and 2016, respectively, and net cash outflows from operations of $28.1 million, $25.9 million and $26.2 million for the fiscal years ended 2018, 2017 and 2016, respectively. In addition, the Company has continued to experience a significant decline in its cash and cash equivalents and marketable debt securities, which was primarily a result of funding operating losses, of which a significant component relates to the Company’s ongoing investments in the research and development of Wearable products. These negative financial conditions raise substantial doubt regarding the Company’s ability to continue as a going concern.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

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Seasonality

Our revenues have not followed a seasonal pattern for the past three years and we do not anticipate any seasonal trend to our revenues in 2019.

Climate Change

We do not believe there is anything unique to our business which would result in climate change regulations having a disproportional effect on us as compared to U.S. industry overall.

Inflation

We do not believe our operations have been materially affected by inflation in the last three fiscal years.

Contractual Obligations

The following is a summary of our contractual payment obligations as of December 29, 2018:

	Payment due by period
	Total		Less than 1 year		1-3 Years		4-5 years		More than 5 years
Operating leases	$	4,060,000	$	1,210,000	$	2,649,000	$	201,000	$	—

The Company has entered into an agreement to make a capital contribution of approximately $5.1 million (the Company's capital contribution under the agreement is $35.0 million Chinese Yuan Renminbi). The Company’s ability to make its capital contribution is subject to Chinese laws which include restrictions of direct foreign investment. Accordingly, the Company will need to make the capital contribution through its Chinese subsidiary’s operations.

Item 8. Financial Statements and Supplementary Data

The financial statements required by this Item are included in this Report on pages 29 through 64. Reference is made to Item 15 of this Report.

Item 9A. Controls and Procedures (As Revised)

Correction of Previously Issued Financial Statements

On October 17, 2019, the Audit Committee of our Board of Directors (the “Audit Committee”) determined that it would be necessary for the Company to correct certain immaterial misstatements identified in its previously-issued consolidated financial statements. The Audit Committee made this determination following consultation with and upon the recommendation of management. Refer to "Part II. Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations" and Note 18. Correction of Previously Issued Financial Statements included in "Part IV. Item 15 - Exhibits and Financial Statement Schedules" for a more detailed description of the misstatements.

Notwithstanding the existence of the material weakness described below, we believe that the revised consolidated financial statements in this Form 10-K/A fairly present, in all material respects, our financial position, results of operations and cash flows as of the dates, and for the periods, presented, in conformity with generally accepted accounting principles (“GAAP”).

Evaluation of Disclosure Controls and Procedures (as revised)

In connection with filing the Original Form 10-K, management, under the supervision of and with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our 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"), as of the end of the period covered by our Annual Report on Form 10-K for the fiscal year ended December 29, 2018. Based on such evaluation as of March 13, 2019, management concluded that, as of the end of such period, our disclosure controls and procedures were effective.

Subsequent to that evaluation, in connection with the correction of certain immaterial misstatements identified in its previously-issued consolidated financial statements for the fiscal year ended December 29, 2018, management reevaluated the

24

effectiveness of our disclosure controls and procedures as of December 29, 2018 and concluded that because of the material weakness identified in our internal control over financial reporting discussed below, our disclosure controls and procedures were not effective as of December 29, 2018.

Management's Annual Report on Internal Control Over Financial Reporting (as revised)

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. A company’s internal control over financial reporting is a process designed by, or under the supervision of, the company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the Company’s Board of Directors, management, and other personnel 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 and include those policies and procedures 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 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.

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

Under the supervision of and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our internal control over financial reporting as of December 29, 2018, based on the framework set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013 framework). Based on that evaluation as of March 13, 2019, our management concluded that, as of December 29, 2018, internal control over financial reporting was effective based on criteria established in Internal Control-Integrated Framework issued by the COSO.

Subsequent to that evaluation, in connection with the correction of certain immaterial misstatements identified in its previously-issued consolidated financial statements for the fiscal year ended December 29, 2018, management, under the supervision of and with the participation of our Chief Executive Officer and Chief Financial Officer, reevaluated the effectiveness of our internal control over financial reporting based on the criteria established by the COSO. Based on this evaluation, management concluded that our internal control over financial reporting was not effective as of December 29, 2018 because of a material weakness. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

Management identified a material weakness in internal control over financial reporting as of December 29, 2018. We did not design and maintain effective controls related to management’s monitoring and oversight of accounting for non-routine transactions. Specifically, our internal controls were not designed effectively to ensure appropriate and timely evaluation of the accounting impact for non-routine transactions, including the accounting for non-controlling interest and other investments.

Our independent registered public accounting firm, Deloitte & Touche LLP, has reissued their report on our internal controls over financial reporting. Deloitte’s reissued report appears on page 27.

Changes in Internal Control Over Financial Reporting

Except for the material weakness discussed above in this Item 9A that has been assessed as a material weakness as of December 29, 2018, there were no other changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during the fiscal quarter ended December 29, 2018 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Management’s Plan to Remediate the Material Weakness

We are committed and are taking steps necessary to remediate the control deficiencies that constituted the above material weakness by implementing changes to our internal control over financial reporting. We are in the process of designing and

25

implementing measures to remediate the underlying causes of the control deficiencies that gave rise to the material weakness. In addition, we are providing in-house accounting personnel training to ensure that they have the relevant expertise related to the monitoring and oversight of accounting for non-routine transactions. We will continue to monitor the effectiveness of these controls and will make any further changes management determines appropriate.

26

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors of Kopin Corporation

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Kopin Corporation and subsidiaries (the “Company”) as of December 29, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, because of the effect of the material weakness identified below on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of December 29, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

In our report dated March 13, 2019, we expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting. As described below, a material weakness was subsequently identified as a result of the correction of the previously issued financial statements. Accordingly, management has revised its assessment about the effectiveness of the Company’s internal control over financial reporting and our present opinion on the effectiveness of the Company’s internal control over financial reporting as of December 29, 2018, as expressed herein, is different from that expressed in our previous report.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 29, 2018, of the Company and our report dated March 13, 2019 (November 7, 2019, as to the effects of the errors discussed in Note 18 to the financial statements), expressed an unqualified opinion on those financial statements and included explanatory paragraphs relating to going concern and the Company’s adoption of a new accounting standard.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting (as revised). Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) 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 (3) 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.

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

27

Material Weakness

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. The following material weakness has been identified and included in management's assessment: The Company did not design and maintain effective controls related to management’s monitoring and oversight of accounting for non-routine transactions. This material weakness was considered in determining the nature, timing, and extent of audit tests applied in our audit of the consolidated financial statements as of and for the year ended December 29, 2018 of the Company, and this report does not affect our report on such financial statements.

/s/ Deloitte & Touche LLP

Boston, Massachusetts

March 13, 2019 (November 7, 2019, as to the effects of the material weakness described in Management’s Annual Report on Internal Control over Financial Reporting (as revised)).

28

Part IV

Item 15. Exhibits and Financial Statement Schedules

(1) Consolidated Financial Statements (As Revised)¹:

	Page
Report of Independent Registered Public Accounting Firm	30
Consolidated Balance Sheets	31
Consolidated Statements of Operations	32
Consolidated Statements of Comprehensive Loss	32
Consolidated Statements of Stockholders’ Equity	34
Consolidated Statements of Cash Flows	35
Notes to Consolidated Financial Statements	36

1. The consolidated financial statements have been revised to correct the misstatements described in Note 18 - Correction of Previously Issued Financial Statements.

(2) Financial Statement Schedules:

Financial Statement Schedules have been omitted because the information required to be set forth therein is not applicable or is shown in the accompanying Consolidated Financial Statements or notes thereto.

(3) Exhibits:

The exhibits filed as part of this Form 10-K/A are listed on the exhibit index immediately preceding such exhibits, and is incorporated herein by reference.

29

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors of Kopin Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Kopin Corporation and subsidiaries (the “Company”) as of December 29, 2018 and December 30, 2017, the related consolidated statements of operations, comprehensive loss, stockholders’ equity, and cash flows, for each of the three years in the period ended December 29, 2018, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 29, 2018 and December 30, 2017, and the results of its operations and its cash flows for each of the three years in the period ended December 29, 2018, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 29, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 13, 2019 (November 7, 2019, as to the effects of the material weakness described in Management’s Annual Report on Internal Control Over Financial Reporting (as revised)), which report expressed an adverse opinion on the Company’s internal control over financial reporting because of a material weakness.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and recurring negative operating cash flows that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Change in Accounting Principle

As discussed in Note 1 to the financial statements, the Company adopted Accounting Standards Codification (ASC) Topic 606, “Revenue from Contracts with Customers,” using the modified retrospective adoption method on December 31, 2017.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Deloitte & Touche LLP

Boston, Massachusetts

March 13, 2019 (November 7, 2019, as to the effects of the errors discussed in Note 18 to the financial statements)

We have served as the Company's auditor since at least 1987; however, an earlier year could not be reliably determined.

30

KOPIN CORPORATION

CONSOLIDATED BALANCE SHEETS  

	December 29, 2018			December 30, 2017
	(As Revised)1			(As Revised)1
ASSETS
Current assets:
Cash and cash equivalents	$	14,326,347		$	24,848,227
Marketable debt securities, at fair value	22,918,016			43,907,457
Accounts receivable, net of allowance of $304,000 and $149,000 in 2018 and 2017, respectively	3,088,360			3,955,123
Contract assets and unbilled receivables	3,089,663			704,863
Inventory	4,797,238			5,080,797
Prepaid taxes	399,611			264,352
Prepaid expenses and other current assets	784,790			978,677
Total current assets	49,404,025			79,739,496
Property, plant and equipment, net	2,598,842			5,077,043
Goodwill	331,344			1,780,247
Intangibles	—			883,636
Other assets	1,649,401			3,842,068
Equity investments	5,565,499			—
Total assets	$	59,549,111		$	91,322,490
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	3,921,880		$	4,918,605
Accrued payroll and expenses	3,038,005			1,636,512
Accrued warranty	571,000			649,000
Contract liabilities and billings in excess of revenue earned	388,933			896,479
Other accrued liabilities	1,901,547			2,066,025
Income tax payable	—			1,416,892
Deferred tax liabilities	546,000			520,000
Total current liabilities	10,367,365			12,103,513
Contract liabilities, noncurrent	17,294			374,171
Asset retirement obligations	254,098			269,877
Other long-term liabilities	1,197,533			1,195,082
Commitments and contingencies (Note 12)
Stockholders’ equity:
Preferred stock, par value $.01 per share: authorized, 3,000 shares; none issued	—			—
Common stock, par value $.01 per share: authorized, 120,000,000 shares; issued 80,735,320 shares in 2018 and 80,201,313 shares in 2017; outstanding 74,008,815 in 2018 and 73,058,783 in 2017, respectively	785,220			775,720
Additional paid-in capital	334,491,397			329,917,858
Treasury stock (4,513,256 shares in 2018 and 2017, at cost)	(17,238,669		)	(17,238,669		)
Accumulated other comprehensive income	1,554,587			3,564,779
Accumulated deficit	(271,730,661		)	(240,256,502		)
Total Kopin Corporation stockholders’ equity	47,861,874			76,763,186
Noncontrolling interest	(149,053		)	616,661
Total stockholders’ equity	47,712,821			77,379,847
Total liabilities and stockholders’ equity	$	59,549,111		$	91,322,490

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

See Accompanying Notes to Consolidated Financial Statements.

31

KOPIN CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

	2018			2017			2016
Fiscal year ended	(As Revised)1						(As Revised)1
Revenues:
Net product revenues	$	19,211,115		$	24,894,805		$	21,115,125
Research and development and other revenues	5,253,890			2,946,685			1,527,441
Total revenue	24,465,005			27,841,490			22,642,566
Expenses:
Cost of product revenues	15,831,441			18,118,418			17,814,271
Research and development-funded programs	4,892,066			3,364,658			786,867
Research and development-internal	12,553,237			15,515,057			15,252,794
Selling, general and administrative	27,210,849			20,541,244			16,961,773
Impairment of goodwill	1,417,470			600,086			—
Impairment of assets	2,526,669			—			—
Gain on sale of property, plant and equipment	—			—			(7,700,522		)
Total operating expenses	64,431,732			58,139,463			43,115,183
Loss from operations	(39,966,727		)	(30,297,973		)	(20,472,617		)
Non-operating income (expense), net:
Interest income	640,059			775,626			658,384
Other income (expense), net	855,106			247,291			(448,581		)
Foreign currency transaction gains (losses)	1,169,254			(1,068,059		)	(672,727		)
Gain on investments	2,849,816			2,000,000			1,034,396
Total non-operating income	5,514,235			1,954,858			571,472
Loss before benefit (provision) for income taxes and net loss (income) of noncontrolling interest	(34,452,492		)	(28,343,115		)	(19,901,145		)
Tax (provision) benefit	(30,000		)	2,963,000			(3,130,000		)
Net loss	(34,482,492		)	(25,380,115		)	(23,031,145		)
Net (income) loss attributable to the noncontrolling interest	(51,050		)	139,633			(537,572		)
Net loss attributable to Kopin Corporation	$	(34,533,542	)	$	(25,240,482	)	$	(23,568,717	)
Net loss per share:
Basic and diluted	$	(0.47	)	$	(0.36	)	$	(0.37	)
Weighted average number of common shares outstanding:
Basic and diluted	73,156,545			69,914,956			64,045,675

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

See Accompanying Notes to Consolidated Financial Statements.

32

KOPIN CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

	2018			2017			2016
Fiscal year ended	(As Revised)1						(As Revised)1
Net loss	$	(34,482,492	)	$	(25,380,115	)	$	(23,031,145	)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(1,912,427		)	1,921,655			809,099
Unrealized holding (loss) gain on marketable securities	(264,949		)	148,520			33,464
Reclassifications of gain (loss) in net loss	49,525			(6,376		)	(48,284		)
Other comprehensive (loss) income, net of tax	(2,127,851		)	2,063,799			794,279
Comprehensive loss	(36,610,343		)	(23,316,316		)	(22,236,866		)
Comprehensive loss (income) attributable to the noncontrolling interest	66,609			69,642			(532,654		)
Comprehensive loss attributable to Kopin Corporation	$	(36,543,734	)	$	(23,246,674	)	$	(22,769,520	)

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

See Accompanying Notes to Consolidated Financial Statements.

33

KOPIN CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (As Revised) ¹ 

 

	Common Stock					Additional Paid-in Capital			Treasury Stock			Accumulated Other Comprehensive Income			Accumulated Deficit			Total Kopin Corporation Stockholders’ Equity			Noncontrolling Interest			Total Stockholders’ Equity
	Shares		Amount
Balance at December 26, 2015	76,079,643		$	760,797		$	325,357,045		$	(42,741,551	)	$	771,774		$	(190,608,671	)	$	93,539,394		$	945,386		$	94,484,780
Vesting of restricted stock	736,842		7,368			(7,368		)	—			—			—			—			—			—
Stock-based compensation expense	—		—			2,482,326			—			—			—			2,482,326			—			2,482,326
Other comprehensive income (loss)	—		—			—			—			799,197			—			799,197			(4,918		)	794,279
Restricted stock for tax withholding obligations	(175,542	)	(1,756		)	(508,841		)	—			—			—			(510,597		)	—			(510,597		)
Net (loss) income	—		—			—			—			—			(23,568,717		)	(23,568,717		)	537,572			(23,031,145		)
Balance at December 31, 2016	76,640,943		766,409			327,323,162			(42,741,551		)	1,570,971			(214,177,388		)	72,741,603			1,478,040			74,219,643
Vesting of restricted stock	1,170,847		11,708			(11,708		)	—			—			—			—			—			—
Stock-based compensation expense	—		—			3,375,330			—			—			—			3,375,330			—			3,375,330
Other comprehensive income	—		—			—			—			1,993,808			—			1,993,808			69,991			2,063,799
Restricted stock for tax withholding obligations	(239,752	)	(2,397		)	(768,926		)	—			—			—			(771,323		)	—			(771,323		)
Distribution to noncontrolling interest holder	—		—			—			—			—			—			—			(791,737		)	(791,737		)
Sale of unregistered stock	—		—			—			25,502,882			—			(838,632		)	24,664,250			—			24,664,250
Net loss	—		—			—			—			—			(25,240,482		)	(25,240,482		)	(139,633		)	(25,380,115		)
Balance at December 30, 2017	77,572,038		775,720			329,917,858			(17,238,669		)	3,564,779			(240,256,502		)	76,763,186			616,661			77,379,847
Vesting of restricted stock	1,093,000		10,930			(10,930		)	—			—			—			—			—			—
Stock-based compensation expense	—		—			4,791,054			—			—			—			4,791,054			—			4,791,054
Other comprehensive loss	—		—			—			—			(2,010,192		)	—			(2,010,192		)	(117,659		)	(2,127,851		)
Restricted stock for tax withholding obligations	(142,972	)	(1,430		)	(206,585		)	—			—			—			(208,015		)	—			(208,015		)
Distribution to noncontrolling interest holder	—		—			—			—			—			—			—			(699,105		)	(699,105		)
Adoption of accounting standard (Note 1)	—		—			—			—			—			3,059,383			3,059,383			—			3,059,383
Net (loss) income	—		—			—			—			—			(34,533,542		)	(34,533,542		)	51,050			(34,482,492		)
Balance at December 29, 2018	78,522,066		$	785,220		$	334,491,397		$	(17,238,669	)	$	1,554,587		$	(271,730,661	)	$	47,861,874		$	(149,053	)	$	47,712,821

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

See Accompanying Notes to Consolidated Financial Statements.

34

KOPIN CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

	2018			2017			2016
Fiscal year ended	(As Revised)1
Cash flows from operating activities:
Net loss	$	(34,482,492	)	$	(25,380,115	)	$	(23,031,145	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	1,958,680			2,501,891			993,621
Accretion of premium or discount on marketable debt securities	15,948			41,364			130,032
Stock-based compensation	4,791,054			2,296,131			2,425,326
Net gain on investment transactions	(2,849,816		)	(2,000,000		)	(1,034,396		)
Deferred income taxes	4,185			(2,421,040		)	1,451,858
Foreign currency (gains) losses	(1,096,487		)	893,260			711,356
Loss (gain) on sale of property and plant	51,159			—			(7,700,522		)
Impairment of assets	2,526,669			—			—
Impairment of goodwill	1,417,470			600,086			—
Change in allowance for bad debt	(155,000		)	13,000			(17,000		)
Other non-cash items	832,615			654,694			677,330
Change in warranty reserves	(79,633		)	142,328			—
Changes in assets and liabilities:
Accounts receivable	853,163			(2,376,593		)	(39,629		)
Contract assets and unbilled receivables	865,474			—			—
Inventory	(1,656,196		)	(1,633,027		)	(1,527,602		)
Prepaid expenses, other current assets and other assets	113,015			(1,084,146		)	48,295
Accounts payable and accrued expenses	(1,208,848		)	1,924,751			1,163,586
Billings in excess of revenue earned	(4,742		)	(85,282		)	(425,805		)
Net cash used in operating activities	(28,103,782		)	(25,912,698		)	(26,174,695		)
Cash flows from investing activities:
Proceeds from sale of marketable debt securities	26,646,078			37,536,004			50,835,253
Purchase of marketable debt securities	(5,697,329		)	(19,633,903		)	(51,828,988		)
Proceeds from sale of investments	—			—			1,034,396
Cash paid for acquisition, net of cash acquired	(1,000,000		)	(3,690,047		)	—
Proceeds from sale of III-V product line	—			—			15,000,000
Proceeds from sale of property and plant	—			—			8,106,819
Other assets	(8,373		)	(140,860		)	80,793
Capital expenditures	(1,183,131		)	(2,794,467		)	(394,897		)
Net cash provided by investing activities	18,757,245			11,276,727			22,833,376
Cash flows from financing activities:
Sale of unregistered stock	—			24,664,250			—
Settlements of restricted stock for tax withholding obligations	(208,015		)	(771,323		)	(510,597		)
Distribution to noncontrolling interest holder	(699,105		)	(791,737		)	—
Net cash (used in) provided by financing activities	(907,120		)	23,101,190			(510,597		)
Effect of exchange rate changes on cash	(268,223		)	560,513			(93,478		)
Net (decrease) increase in cash and cash equivalents	(10,521,880		)	9,025,732			(3,945,394		)
Cash and cash equivalents at beginning of year	24,848,227			15,822,495			19,767,889
Cash and cash equivalents at end of year	$	14,326,347		$	24,848,227		$	15,822,495
Supplemental disclosure of cash flow information:
Income taxes paid	$	1,374,000		$	281,000		$	723,000
Construction in progress included in accrued expenses	—			212,000			—

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

See Accompanying Notes to Consolidated Financial Statements.

35

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.    Summary of Significant Accounting Policies (As Revised)

The preparation of consolidated 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 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. As used in these notes, the terms “we,” “us,” “our,” “Kopin” and the “Company” mean Kopin Corporation and its subsidiaries, unless the context indicates another meaning.

Going Concern

The Company has incurred net losses of $34.5 million, $25.4 million and $23.0 million for the fiscal years ended 2018, 2017 and 2016, respectively, and net cash outflows from operations of $28.1 million, $25.9 million and $26.2 million for the fiscal years ended 2018, 2017 and 2016, respectively. In addition, the Company has continued to experience a significant decline in its cash and cash equivalents and marketable debt securities, which was primarily a result of funding operating losses, of which a significant component relates to the Company’s ongoing investments in the research and development of Wearable products. These negative financial conditions raise substantial doubt regarding the Company’s ability to continue as a going concern.

The Company’s products are targeted towards the wearable market, which management believes is still developing and cannot predict how long the wearable market will take to develop or if the Company’s products will be accepted.  Accordingly, the Company’s current strategy is to continue to invest in research and development, even during unprofitable periods, which may result in the Company continuing to incur net losses and negative cash flows from operations.  If the Company is unable to achieve and maintain positive cash flows and profitability in the foreseeable future, its financial condition may ultimately be materially adversely affected such that management may be required to reduce operating expenses, including investments in research and development, or raise additional capital. While there can be no assurance the Company will be able to successfully reduce operating expenses or raise additional capital, management believes its historical success in managing cash flows and obtaining capital will continue in the foreseeable future.

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Fiscal Year

The Company’s fiscal year ends on the last Saturday in December. The fiscal years ended December 29, 2018 and December 30, 2017 includes 52 weeks and December 31, 2016 includes 53 weeks, and are referred to as fiscal years 2018, 2017 and 2016, respectively, herein. The impact of the 53^rd week in the 2016 fiscal year was not material to the Company's results of operations.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and a majority owned 80% subsidiary, eMDT America Inc. ("eMDT"), located in California (collectively the Company). Net loss attributable to noncontrolling interest in the Company's Consolidated Statement of Operations represents the portion of the results of operations of which is allocated to the shareholders of the equity interests not owned by the Company. All intercompany transactions and balances have been eliminated.

Revenue Recognition - 2018

The Company adopted ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) effective December 31, 2017 and applied the modified retrospective method. The Company recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of accumulated deficit. The comparative information has not been revised and continues to be reported under the accounting standards in effect for those periods. The Company expects the impact of the adoption of the new standard to be material to the Company's results of operations on an ongoing basis. Significant changes to the Company's accounting policies as a result of adopting Topic 606 are discussed below.

Substantially all of our product revenues are either derived from the sales of components for use in military applications or our wearable technology components that can be integrated to create industrial and consumer headset systems. We also have development contracts for the design, manufacture and modification of products for the U.S. government or a prime contractor

36

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

for the U.S. government or for a customer that sells into the industrial or consumer markets. The Company's contracts with the U.S. government are typically subject to the Federal Acquisition Regulations (“FAR”) and are priced based on estimated or actual costs of producing goods. The FAR provides guidance on the types of costs that are allowable in establishing prices for goods provided under U.S. government contracts. The pricing for non-U.S. government contracts is based on the specific negotiations with each customer.

Our fixed-price contracts with the U.S. government or other customers may result in revenue recognized in excess of amounts currently billed. We disclose the excess of revenues over amounts actually billed as Contract assets and unbilled receivables on the balance sheet. Amounts billed and due from our customers are classified as Accounts receivable on the balance sheets. In some instances, the U.S. government retains a small portion of the contract price until completion of the contract. The portion of the payments retained until final contract settlement is not considered a significant financing component because the intent is to protect the customer. For contracts with the U.S. government, we typically receive interim payments either as work progresses or by achieving certain milestones or based on a schedule in the contract. We recognize a liability for these advance payments in excess of revenue recognized and present it as Contract liabilities and billings in excess of revenue earned on the balance sheets. The advanced payment typically is not considered a significant financing component because it is used to meet working capital demands that can be higher in the early stages of a contract and to protect us from the other party failing to adequately complete some or all of its obligations under the contract. For industrial and consumer purchase orders, we typically receive payments within 30 to 60 days of shipments of the product, although for some purchase orders, we may require an advanced payment prior to shipment of the product.

To determine the proper revenue recognition method for contracts with the same customer, we evaluate whether two or more contracts should be combined and accounted for as one single contract and whether the combined or single contract should be accounted for as more than one performance obligation. For most of our development contracts and contracts with the U.S government, the customer contracts with us to provide a significant service of integrating a set of components into a single unit. Hence, the entire contract is accounted for as one performance obligation. Less frequently, however, we may promise to provide distinct goods or services within a contract in which case we separate the contract into more than one performance obligation. If a contract is separated into more than one performance obligation, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. In cases where we sell standard products, the observable standalone sales are used to determine the standalone selling price.

The Company recognizes revenue from a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.

Commencing in 2018 for certain contracts with the U.S. government, the Company recognizes revenue over time as we perform because of continuous transfer of control to the customer and the lack of an alternative use for the product. The continuous transfer of control to the customer is supported by liability clauses in the contract that allow the U.S. government to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. For contracts with commercial customers, while the contract may have a similar liability clause, our products historically have an alternative use and thus, revenue is recognized at a point in time.

In situations where control transfers over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. We generally use the cost-to-cost approach to measure the extent of progress towards completion of the performance obligation for our contracts because we believe it best depicts the transfer of assets to the customer. Under the cost-to-cost measure approach, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recorded proportionally as costs are incurred.

Accounting for design, development and production contracts requires judgment relative to assessing risks, estimating contract revenues and costs, and making assumptions for schedule and technical issues. Due to the size and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. We have to make assumptions regarding the number of labor hours required to complete a task, the complexity of the work to be performed, the availability and cost of materials, and performance by our subcontractors. For contract change orders, claims or similar items, we apply judgment in estimating the amounts and assessing the potential for realization. These amounts are only included in contract value when they can be reliably estimated and realization is considered probable. If our estimate of total contract costs or our determination of whether the customer agrees that a milestone is achieved is incorrect, our revenue could be overstated or understated and the profits or loss reported could be subject to adjustment.

37

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

For our commercial customers, the Company's revenue is recognized when obligations under the terms of a contract with our customer is satisfied and the Company transfers control of the products or services, which is generally upon delivery to the customer. Revenue is recorded as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Provisions for product returns and allowances are reductions in the transaction price and are recorded in the same period as the related revenues. We analyze historical returns, current economic trends and changes in customer demand when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for stocking of inventory. Sales, value add and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.

The rights and benefits to the Company's intellectual property are conveyed to certain customers through technology license agreements. These agreements may include other performance obligations including the sale of product to the customer. When the license is distinct from other obligations in the agreement, the Company treats the license and other performance obligations as separate performance obligations. Accordingly, the license is recognized at a point in time or over time based on the standalone selling price. The sale of materials is recognized at a point in time, which occurs with the transfer of control of the Company's products or services. In certain instances, the Company is entitled to sales-based royalties under license agreements. These sales-based royalties are recognized when they are earned. Revenues from sales-based royalties under license agreements are shown under Research and development and other revenues on the Company's Consolidated Statements of Operations.

The cumulative effect of the changes made to the Company's consolidated December 31, 2017 balance sheet for the adoption of ASU 2014-09, Revenue from Contracts with Customers (Topic 606) was as follows:

Balance Sheet	Balance at December 30, 2017			Adjustments due to Topic 606			Balance at December 31, 2017
Assets
Contract assets and unbilled receivables	$	704,863		$	2,850,274		$	3,555,137
Inventory	5,080,797			(1,082,629		)	3,998,168
Other assets	3,842,068			400,000			4,242,068
Liabilities
Contract liabilities and billings in excess of revenue earned	1,555,883			(891,737		)	664,146
Stockholders’ equity
Accumulated Deficit1	$	(240,256,502	)	$	3,059,383		$	(237,197,119	)

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

In accordance with the new revenue standard requirements, the impact of adoption on the Company's consolidated statement of operations for the fiscal year 2018 was as follows:

Statement of Operations	As Reported			Balances Without Adoption of Topic 606			Effect of Change Higher/(Lower)
Net product revenues	$	19,211,115		$	19,726,901		$	(515,786	)
Research and development and other revenues	5,253,890			5,600,066			(346,176		)
Cost of product revenues	15,831,441			16,809,343			(977,902		)
Net loss attributable to Kopin Corporation	$	(34,533,542	)	$	(34,649,482	)	$	115,940

See Note 14. Segments and Disaggregation of Revenue for additional information regarding the disaggregation of the Company's revenue by major source.

Contract Assets

Contract assets include unbilled amounts typically resulting from sales under contracts when the cost-to-cost method of revenue recognition is utilized and revenue recognized from customer arrangements, including licensing, exceeds the amount billed to the customer, and right to payment is not just subject to the passage of time. Amounts may not exceed their net realizable value. Contract assets are generally classified as current. The Company classifies the noncurrent portion of contract assets under other assets in its condensed consolidated balance sheets.

38

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Contract Liabilities

Contract liabilities consist of advance payments and billings in excess of revenue recognized for the contract.

Performance Obligations

The Company's revenue recognition related to performance obligations that were satisfied at a point in time and over time were as follows:

Fiscal year ended	2018		2017		2016
Point in time	60	%	91	%	95	%
Over time	40	%	9	%	5	%

The value of remaining performance obligations represent the transaction price of orders for which work has not been performed and excludes unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity ("IDIQ")). As of December 29, 2018, the aggregate amount of the transaction price allocated to remaining performance obligations was $8.0 million. The Company expects to recognize revenue on the remaining performance obligations of $8.0 million over the next 12 months. The remaining performance obligations represent amounts to be earned under government contracts, which are subject to cancellation.

Revenue Recognition - 2017

We recognize revenue if four basic criteria have been met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred and services rendered; (3) the price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. We do not recognize revenue for products prior to customer acceptance unless we believe the product meets all customer specifications and has a history of consistently achieving customer acceptance of the product. Provisions for product returns and allowances are recorded in the same period as the related revenues. We analyze historical returns, current economic trends and changes in customer demand and acceptance of product when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for stocking of inventory. We delay revenue recognition for our estimate of distributor claims of right of return on unsold products based upon our historical experience with our products and specific analysis of amounts subject to return based upon discussions with our distributors or their customers.

We recognize revenues from long-term research and development government contracts on the percentage-of-completion method of accounting as work is performed, based upon the ratio of costs or hours already incurred to the estimated total cost of completion or hours of work to be performed. Revenue recognized at any point in time is limited to the amount funded by the U.S. government or contracting entity. We recognize revenue for product development and research contracts that have established prices for distinct phases when delivery and acceptance of the deliverable for each phase has occurred. In some instances, we are contracted to create a deliverable which is anticipated to go into full production. In those cases, we discontinue the percentage-of-completion method after formal qualification of the deliverable has been completed and revenue is then recognized based on the criteria established for sale of products. In certain instances, qualification may be achieved and delivery of production units may commence however our customer may have either identified new issues to be resolved or wish to incorporate a newer display technology. In these circumstances new units delivered will continue to be accounted for under the criteria established for sale of products. Under certain of our research and development contracts, we recognize revenue using a milestone methodology. This revenue is recognized when we achieve specified milestones based on our past performance.

We classify amounts earned on contracts in progress that are in excess of amounts billed as unbilled receivables and we classify amounts received in excess of amounts earned as billings in excess of revenues earned. We invoice based on dates specified in the related agreement or in periodic installments based upon our invoicing cycle. We recognize the entire amount of an estimated ultimate loss in our financial statements at the time the loss on a contract becomes known.

Accounting for design, development and production contracts requires judgment relative to assessing risks, estimating contract revenues and costs, and making assumptions for schedule and technical issues. Due to the size and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. We have to make assumptions regarding the number of labor hours required to complete a task, the complexity of the work to be performed, the availability and cost of materials, and performance by our subcontractors. For contract change orders, claims or similar items, we apply judgment in estimating the amounts and assessing the potential for realization. These amounts are only included in contract value when they can be reliably estimated and realization is considered probable. We

39

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

have accounting policies in place to address these as well as other contractual and business arrangements to properly account for long-term contracts. If our estimate of total contract costs or our determination of whether the customer agrees that a milestone is achieved is incorrect, our revenue could be overstated and profits would be negatively impacted.

Research and Development Costs

Research and development expenses are incurred in support of internal display product development programs or programs funded by agencies or prime contractors of the U.S. government and commercial partners. Research and development costs include staffing, purchases of materials and laboratory supplies, circuit design costs, fabrication and packaging of experimental display products, and overhead, and are expensed immediately.

Cash and Cash Equivalents

The Company considers all highly liquid, short-term debt instruments with original maturities of three months or less to be cash equivalents.

Inventory

Inventories are stated at standard cost adjusted to approximate the lower of cost (first-in, first-out method) or net realizable value. The Company adjusts inventory carrying value for estimated obsolescence equal to the difference between the cost of inventory and the estimated net realizable value based upon assumptions about future demand and market conditions. The Company fully reserves for inventories and non-cancellable purchase orders for inventory deemed obsolete. The Company performs periodic reviews of inventory items to identify excess inventories on hand by comparing on-hand balances to anticipated usage using recent historical activity as well as anticipated or forecasted demand. If estimates of customer demand diminish further or market conditions become less favorable than those projected by the Company, additional inventory adjustments may be required.

We regularly review inventory quantities on-hand and we write down inventory based on excess or obsolete inventories determined primarily by future anticipated demand for our products. Inventory write-downs are measured as the difference between the cost of the inventory and net realizable value, based upon assumptions about future demand, which are inherently difficult to assess and dependent on market conditions. At the point of a loss recognition, a new, lower cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established basis.

Inventory consists of the following at December 29, 2018 and December 30, 2017:

	2018		2017
Raw materials	$	2,548,139	$	2,070,153
Work-in-process	1,526,552		1,829,805
Finished goods	722,547		1,180,839
	$	4,797,238	$	5,080,797

Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets, generally 3 to 10 years. Leasehold improvements and leased equipment are amortized over the shorter of the term of the lease or the useful life of the improvement or equipment. As discussed below, obligations for asset retirement are accrued at the time property, plant and equipment is initially purchased or as such obligations are generated from use.

Collaborative Arrangements

The Company evaluates whether an arrangement is a collaborative arrangement under the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) Topic 808, Collaborative Arrangements, at its inception based on the facts and circumstances specific to the arrangement. The Company also reevaluates whether an arrangement qualifies or continues to qualify as a collaborative arrangement whenever there is a change in either the roles of the participants or the participants’ exposure to significant risks and rewards dependent on the ultimate commercial success of the endeavor. For those collaborative arrangements where it is determined that the Company is the principal participant, costs incurred and revenue generated from third parties are recorded on a gross basis in the financial statements.

40

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

From time to time, the Company enters into collaborative arrangements for the research and development, manufacture and/or commercialization of products. The Company’s collaboration agreements with third parties are performed on a ‘‘best efforts’’ basis with no guarantee of either technological or commercial success.

Product Warranty

The Company generally sells products with a limited warranty of product quality and a limited indemnification of customers against intellectual property infringement claims related to the Company’s products. The Company accrues for known warranty and indemnification issues if a loss is probable and can be reasonably estimated, and accrues for estimated incurred but unidentified issues based on historical activity. Accrued warranty costs and warranty claims are not material in the periods presented.

Extended Warranties

The Company recognizes revenue from an extended warranty on the straight-line method over the life of the extended warranty, which is typically 12 to 18 months beyond the standard 12 month warranty. The Company classifies the current portion of extended warranties under contract liabilities and billings in excess of revenue earned and the noncurrent portion of extended warranties under contract liabilities, noncurrent in its consolidated balance sheets. The Company currently has approximately $0.4 million of contract liabilities related to extended warranties at December 29, 2018.

Asset Retirement Obligations

The Company recorded asset retirement obligations ("ARO") liabilities of $0.3 million at December 29, 2018 and December 30, 2017. This represents the legal obligations associated with retirement of the Company’s assets when the timing and/or method of settling the obligation are conditional on a future event that may or may not be within the control of the Company. Changes in ARO liabilities for fiscal years 2018 and 2017 are as follows:

	2018			2017
Beginning balance	$	269,877		$	246,922
Exchange rate change	(15,779		)	22,955
Ending balance	$	254,098		$	269,877

Income Taxes

The consolidated financial statements reflect provisions for federal, state, local and foreign income taxes. The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, as well as operating loss and tax credit carryforwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carryforwards 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. The Company provides valuation allowances if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Foreign Currency

Assets and liabilities of non-U.S. operations where the functional currency is other than the U.S. dollar are translated from the functional currency into U.S. dollars at year end exchange rates, and revenues and expenses are translated at average rates prevailing during the year. Resulting translation adjustments are accumulated as part of accumulated other comprehensive income. Transaction gains or losses are recognized in income or loss in the period in which they occur.

Net Loss Per Share

Basic net loss per share is computed using the weighted-average number of shares of common stock outstanding during the period less any unvested restricted shares. Diluted net loss per share is calculated using weighted-average shares outstanding and contingently issuable shares, less weighted-average shares reacquired during the period. The net outstanding shares are adjusted for the dilutive effect of shares issuable upon the assumed conversion of the Company’s common stock equivalents, which consist of outstanding stock options and unvested restricted stock.

The following were not included in weighted-average common shares outstanding-diluted because they are anti-dilutive or performance conditions have not been met at the end of the period:

41

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

	2018	2017	2016
Nonvested restricted common stock	2,213,249	2,629,274	3,007,674

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk other than marketable securities consist principally of trade accounts receivable. Trade receivables are primarily derived from sales to manufacturers of consumer electronic devices and wireless components or military applications. The Company sells its products to customers worldwide and generally does not require collateral. The Company maintains a reserve for potential credit losses.

The Company primarily invests its excess cash in government backed and corporate debt securities that management believes to be of high credit worthiness, which bear lower levels of relative credit risk. The Company relies on rating agencies to ascertain the credit worthiness of its marketable securities and, where applicable, guarantees made by the Federal Deposit Insurance Company.

Fair Value of Financial Instruments

Financial instruments consist of marketable debt securities, accounts receivable and certain current liabilities. These assets (excluding marketable securities which are recorded at fair value) and liabilities are carried at cost, which approximates fair value.

Recognition and Measurement of Financial Assets and Liabilities

We periodically make equity investments in private companies, accounted for as an equity investment, whose values are difficult to determine. The Company adopted ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities and the related amendments on December 31, 2017. This standard amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The Company adopted the measurement alternative for equity investments without readily determinable fair values (often referred to as cost method investments) on a prospective basis. When assessing investments in private companies for impairment, we consider such factors as, among other things, the share price from the investee's latest financing round, the performance of the investee in relation to its own operating targets and its business plan, the investee's revenue and cost trends, the liquidity and cash position, including its cash burn rate and market acceptance of the investee's products and services. Because these are private companies which we do not control we may not be able to obtain all of the information we would want in order to make a complete assessment of the investment on a timely basis. Accordingly, our estimates may be revised if other information becomes available at a later date.

Marketable Debt Securities

Marketable debt securities consist primarily of commercial paper, medium-term corporate notes, and U.S. government and agency backed securities. The Company classifies these marketable debt securities as available-for-sale at fair value in “Marketable debt securities, at fair value”. The Company's investment in GCS Holdings is included in "Other Assets" as available-for-sale and at fair value. The Company records the amortization of premium and accretion of discounts on marketable debt securities in the results of operations.

The Company uses the specific identification method as a basis for determining cost and calculating realized gains and losses with respect to marketable debt securities. The gross gains and losses realized related to sales and maturities of marketable debt securities were not material during the fiscal years ended 2018, 2017 and 2016.

Other-than-Temporary Impairments

The Company conducts a review of its marketable debt securities on a quarterly basis for the presence of other-than-temporary impairment ("OTTI"). The Company assesses whether OTTI is present when the fair value of a debt security is less than its amortized cost basis at the balance sheet date. Under these circumstances OTTI is considered to have occurred (1) if the Company intends to sell the security before recovery of its amortized cost basis; (2) if it is “more likely than not” the Company will be required to sell the security before recovery of its amortized cost basis; or (3) the present value of expected cash flows is not sufficient to recover the entire amortized cost basis.

The Company further estimates the amount of OTTI resulting from a decline in the creditworthiness of the issuer (credit-related OTTI) and the amount of non credit-related OTTI. Non credit-related OTTI can be caused by such factors as market illiquidity. Credit-related OTTI is recognized in earnings while non credit-related OTTI on securities not expected to be sold is

42

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

recognized in other comprehensive income (loss). The Company did not record any OTTI for the fiscal years 2018, 2017 and 2016.

Stock-Based Compensation

The fair value of nonvested restricted common stock awards is generally the quoted price of the Company’s equity shares on the date of grant. The nonvested restricted common stock awards require the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also require meeting either performance criteria or market condition. The performance criteria primarily consist of the achievement of established milestones. For nonvested restricted common stock awards which solely require the recipient to remain employed with the Company, the stock compensation expense is amortized over the anticipated service period. For nonvested restricted common stock awards which require the achievement of performance criteria, the Company reviews the probability of achieving the performance goals on a periodic basis. If the Company determines that it is probable that the performance criteria will be achieved, the amount of compensation cost derived for the performance goal is amortized over the service period. If the performance criteria are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed. The Company recognizes compensation costs on a straight-line basis over the requisite service period for time vested awards.

The value of restricted stock grants that vest based on market conditions is computed on the date of grant using the Monte Carlo model. The fair value of stock option awards is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. There were no stock options granted in fiscal years 2018, 2017 or 2016.

Comprehensive Loss

Comprehensive loss is the total of net (loss) income and all other non-owner changes in equity including such items as unrealized holding (losses) gains on marketable equity and debt securities classified as available-for-sale and foreign currency translation adjustments.

The components of accumulated other comprehensive income are as follows:

	Cumulative Translation Adjustment			Unrealized holding (loss) gain on marketable securities			Reclassifications of gain (loss) in net loss			Accumulated Other Comprehensive Income
Balance as of December 26, 2015	$	566,025		$	205,749		$	—		$	771,774
Changes during year	814,017			33,464			(48,284		)	799,197
Balance as of December 31, 2016	1,380,042			239,213			(48,284		)	1,570,971
Changes during year	1,851,664			148,520			(6,376		)	1,993,808
Balance as of December 30, 2017	3,231,706			387,733			(54,660		)	3,564,779
Changes during year	(1,794,768		)	(264,949		)	49,525			(2,010,192		)
Balance as of December 29, 2018	$	1,436,938		$	122,784		$	(5,135	)	$	1,554,587

Goodwill

We account for goodwill in accordance with ASC Topic 350. Under ASC Topic 350, goodwill is considered to have an indefinite life, and is carried at cost. Goodwill is not amortized, but is subject to an annual impairment test, as well as between annual tests when events or circumstances indicate that the carrying value may not be recoverable.

The determination of reporting units under ASC 350 begins with the definition of an operating segment in ASC 280 and takes into account the disaggregation of that operating segment into economically dissimilar components for goodwill impairment testing purposes. The level at which operating performance is reviewed also differs between ASC 280 and ASC 350. The chief operating decision maker ("CODM") is the Company's Chief Executive Officer who reviews operating segments and the segment manager reviews reporting units (components of operating segments). Therefore, a component of an operating segment would not be considered an operating segment under ASC 280 unless the CODM regularly reviews its operating performance. However, that same component might be a reporting unit under ASC 350 if a segment manager regularly reviews its operating performance (and if the other reporting unit criteria are met). Goodwill is evaluated for impairment annually or more often if indicators of a potential impairment are present. The Company performs impairment tests of goodwill at its reporting unit level. The goodwill valuations that are utilized to test these assets for impairment are depending on a number of significant estimates and assumptions, including macroeconomic conditions, overall growth rates, competitive activities, cost containment, Company business plans and the discount rate applied to cash flows. We believe these estimates and assumptions are reasonable and are comparable to those that would be used by other market participants. However, actual events and results

43

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

could differ substantially from those used in our valuations. To the extent such factors result in a failure to achieve the level of projected cash flows initially used to estimate fair value for purposes of establishing the carrying amount of goodwill and intangibles, we may need to record non-cash impairment charges in the future.  

Impairment of Long-Lived Assets

The Company periodically reviews the carrying value of its long-lived assets to determine if facts and circumstances suggest that they may be impaired or that the amortization or depreciation period may need to be changed. The carrying value of a long-lived asset is considered impaired when the anticipated identifiable undiscounted cash flows from such asset are less than its carrying value. For assets that are to be held and used, impairment is measured based upon the amount by which the carrying amount of the asset exceeds its fair value.

Recently Issued Accounting Pronouncements

Leases

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize a right-of-use asset and lease liability for most lease arrangements. The new standard is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which allows for an additional transition method under the modified retrospective approach for the adoption of Topic 842. The two permitted transition methods are now: (1) to apply the new lease requirements at the beginning of the earliest period presented, and (2) to apply the new lease requirements at the effective date. Under both transition methods there is a cumulative effect adjustment. We intend to adopt the standard on the effective date of December 30, 2018 by applying the new lease requirements at the effective date. We also intend to elect the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allows us to carry forward the historical lease classification. We have evaluated the changes from this ASU to our future financial reporting and disclosures, and have designed and implemented related processes and controls to address these changes. We expect the standard will result in the recognition of right-of-use assets of $3.5 million to $4.0 million and lease liabilities of $3.5 million to $4.0 million as of December 30, 2018, with immaterial changes to other balance sheet accounts. The standard will have no impact on our results of operations or liquidity. In addition, new disclosures will be provided to enable users to assess the amount, timing and uncertainty of cash flows arising from leases.

Other new pronouncements issued but not effective until after December 29, 2018 are not expected to have a material impact on our financial position, results of operations or liquidity.

2.    Property, Plant and Equipment

Property, plant and equipment consisted of the following at December 29, 2018 and December 30, 2017:

	Useful Life	2018			2017
Equipment	3-5 years	$	16,824,384		$	16,811,526
Leasehold improvements	Life of the lease	3,676,775			3,851,269
Furniture and fixtures	3 years	523,736			531,870
Equipment under construction		436,806			2,415,957
		21,461,701			23,610,622
Accumulated depreciation and amortization		(18,862,859		)	(18,533,579		)
Property, plant and equipment, net		$	2,598,842		$	5,077,043

Depreciation expense for the fiscal years 2018, 2017 and 2016 was approximately $1.0 million, $0.9 million and $1 million, respectively.

During the fiscal year 2018, the Company recorded asset impairment charges of $2.5 million associated with equipment that either is not currently being utilized or will not be utilized for its remaining useful life and is not recoverable.

44

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

3.    Contract Assets and Liabilities

Net contract assets (liabilities) consisted of the following:

	December 29, 2018			December 31, 2017			$ Change			% Change
Contract assets and unbilled receivables	$	3,089,663		$	3,555,137		$	(465,474	)	(13	)%
Contract liabilities and billings in excess of revenue earned	(388,933		)	(664,146		)	275,213			(41	)%
Contract liabilities, noncurrent	(17,294		)	(374,171		)	356,877			(95	)%
Net contract assets	$	2,683,436		$	2,516,820		$	166,616		7	%

The $0.2 million increase in the Company's net contract assets from December 31, 2017 to December 29, 2018 was primarily due to our fixed-price contracts with the U.S. government that resulted in revenue recognized in excess of amounts billed and the adoption of Topic 606.

The Company recognized revenue of approximately $0.3 million and $0.4 million related to our contract liabilities at December 31, 2017 and January 1, 2017, respectively.

The Company did not recognize impairment losses on our contract assets during the years ended December 29, 2018 and December 30, 2017.

4.    Business Combinations

In March 2017, we purchased 100% of the outstanding stock of NVIS, Inc. ("NVIS") for $3.7 million. NVIS produces virtual reality systems for 3D applications. Additional payments by the Company of up to $2.0 million may be required if certain future operating performance milestones are met and the selling shareholders remain employed with NVIS through March 2020. As there is a requirement to remain employed to earn the contingent payments, these contingent payments will be treated as compensation expense.

The identifiable assets acquired and liabilities assumed at the acquisition date have been recognized at fair value. The allocation of the purchase price as of the acquisition date is as follows:

Cash and marketable securities	$	2,600
Accounts receivable	490,700
Inventory	768,400
Other identifiable assets	46,800
Order backlog	840,000
Customer relationships	1,000,000
Developed technology	460,000
Trademark portfolio	160,000
Current liabilities	(480,500		)
Net deferred tax liabilities	(1,084,000		)
Goodwill	1,489,000
Total	$	3,693,000

Goodwill represents the recording of the excess of the purchase price over the fair values of the net tangible assets acquired. No significant adjustments were recorded to the purchase price allocation during the measurement period. During the fourth quarter of 2017, we finalized the fair values of the acquired assets and liabilities.

The identified intangible assets are being amortized on a straight-line basis over the following lives, in years:

Order backlog	1
Customer relationships	2
Developed technology	2
Trademark portfolio	2

45

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

In conjunction with the acquisition, the Company recorded deferred tax liabilities of approximately $1.1 million associated with the future non-deductible amortization of the intangible assets. These deferred tax liabilities can be used to offset the Company’s net deferred tax assets. The Company reduced the valuation allowance on its net deferred tax assets in the amount of $1.1 million and such reduction was recognized as a benefit for income taxes for 2017. Acquisition expenses were approximately $0.2 million for the fiscal year ended 2017 and were recorded in selling, general and administration expenses.

The following unaudited supplemental pro forma disclosures are provided for the fiscal year ended December 30, 2017. All intercompany transactions have been eliminated.

Fiscal year ended	2017			2016
Revenues	$	28,477,870		$	25,029,681
Net loss	(26,302,840		)	(23,736,518		)
Basic and diluted earnings per share	$	(0.38	)	$	(0.37	)

5.    Goodwill and Intangibles

A rollforward of the Company's goodwill by segment is as follows:

	Kopin			Industrial			Total
Balance, December 31, 2016	$	844,023		$	—		$	844,023
March 2017 acquisition of NVIS, Inc.	—			1,488,650			1,488,650
Impairment of goodwill	—			(600,086		)	(600,086		)
Change due to exchange rate fluctuations	47,660			—			47,660
Balance, December 30, 2017	891,683			888,564			1,780,247
Impairment of goodwill	(528,906		)	(888,564		)	(1,417,470		)
Change due to exchange rate fluctuations	(31,433		)	—			(31,433		)
Balance, December 29, 2018	$	331,344		$	—		$	331,344

Goodwill is evaluated for impairment annually or more often if indicators of a potential impairment are present. The Company performs impairment tests of goodwill at its reporting unit level. The goodwill valuations that are utilized to test these assets for impairment are depending on a number of significant estimates and assumptions, including macroeconomic conditions, overall growth rates, competitive activities, cost containment, Company business plans and the discount rate applied to cash flows. We believe these estimates and assumptions are reasonable and are comparable to those that would be used by other market participants. However, actual events and results could differ substantially from those used in our valuations. To the extent such factors result in a failure to achieve the level of projected cash flows initially used to estimate fair value for purposes of establishing the carrying amount of goodwill, we may need to record non-cash impairment charges in the future.

At December 29, 2018, the Company performed an impairment analysis of goodwill based on a comparison of the discounted cash flows to the recorded carrying value of the reporting units, and determined that the discounted cash flows were not in excess of the carrying value of the NVIS reporting unit. At December 29, 2018, the Company decided to discontinue operations at its wholly-owned subsidiary, Kopin Software Ltd. and expects no future cash flows to support the carrying amount of goodwill. As a result, the Company recorded an impairment of goodwill of $1.4 million at December 29, 2018. The input methods for goodwill are analyzed for impairment on a nonrecurring basis using fair value measurements with unobservable inputs, which is Level 3 in the fair value hierarchy.

The Company recognized $0.9 million, $1.6 million and $0.0 million in amortization expense for the fiscal years ended 2018, 2017 and 2016, respectively, related to intangible assets. At December 29, 2018, the Company has a carrying value of $2.5 million and accumulated amortization of $2.5 million related to intangibles. The intangibles have no remaining useful life.

46

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6.    Financial Instruments

Fair Value Measurements

Financial instruments are categorized as Level 1, Level 2 or Level 3 based upon the method by which their fair value is computed. An investment is categorized as Level 1 when its fair value is based on unadjusted quoted prices in active markets for identical assets that the Company has the ability to access at the measurement date. An investment is categorized as Level 2 if its fair market value is based on quoted market prices for similar assets in active markets, quoted prices for identical or similar assets in markets that are not active, based on observable inputs such as interest rates, yield curves, or derived from or corroborated by observable market data by correlation or other means. An investment is categorized as Level 3 if its fair value is based on assumptions developed by the Company about what a market participant would use in pricing the assets.

The following table details the fair value measurements of the Company’s financial assets:

			Fair Value Measurement at December 29, 2018 Using:
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	14,326,347	$	14,326,347	$	—	$	—
U.S. government and agency backed securities	12,810,923		—		12,810,923		—
Corporate debt	10,107,093		—		10,107,093		—
GCS Holdings	288,026		288,026		—		—
Equity Investments	5,565,499		—		—		5,565,499
	$	43,097,888	$	14,614,373	$	22,918,016	$	5,565,499

			Fair Value Measurement at December 30, 2017 Using:
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	24,848,227	$	24,848,227	$	—	$	—
U.S. government and agency backed securities	34,725,811		6,927,323		27,798,488		—
Corporate debt	8,980,906		—		8,980,906		—
Certificates of deposit	200,740		—		200,740		—
GCS Holdings	478,546		478,546		—		—
Warrant	2,000,000		—		—		2,000,000
	$	71,234,230	$	32,254,096	$	36,980,134	$	2,000,000

Transfers between levels of the fair value hierarchy are reported at the beginning of the reporting period in which they occur. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of their short-term nature. If accrued liabilities were carried at fair value, these would be classified as Level 2 in the fair value hierarchy.

Changes in Level 3 investments are as follows:

	December 30, 2017		Net unrealized gains/(losses)			Purchases, issuances and settlements			Transfers in and or out of Level 3		December 29, 2018
Equity Investments	$	—	$	(284,317	)	$	5,849,816		$	—	$	5,565,499
Warrant	2,000,000		(50,184		)	(1,949,816		)	—		—
	$	2,000,000	$	(334,501	)	$	3,900,000		$	—	$	5,565,499

Equity Investments

Equity investments rarely traded or not quoted will generally have less (or no) pricing observability and a higher degree of judgment utilized in measuring fair value. Initial measurement of equity investments occurs when an observable price for the equity investment is available. The Company adopted ASU No. 2016-01 and the related amendments on December 31, 2017 (the first day of the Company's fiscal year 2018). This standard amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The Company adopted the measurement alternative for equity investments without readily determinable fair values (often referred to as cost method investments) on a prospective basis. As a result, these investments will be revalued upon occurrence of an observable price change for similar investments and for impairments.

47

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Warrant

The Company had a warrant to acquire up to 15% of the next round of equity offered by a customer as part of the licensing of technology to the customer. The Company exercised the warrant in April 2018.

Marketable Debt Securities

The corporate debt consists of floating rate notes with a maturity that is over multiple years but has interest rates that are reset every three months based on the then-current three-month London Interbank Offering Rate ("three-month Libor"). The Company validates the fair market values of the financial instruments above by using discounted cash flow models, obtaining independent pricing of the securities or through the use of a model that incorporates the three-month Libor, the credit default swap rate of the issuer and the bid and ask price spread of the same or similar investments which are traded on several markets. Investments in available-for-sale marketable debt securities are as follows at December 29, 2018 and December 30, 2017: 

	Amortized Cost				Unrealized Losses						Fair Value
	2018		2017		2018			2017			2018		2017
U.S. government and agency backed securities	$	13,064,418	$	35,014,593	$	(253,495	)	$	(288,782	)	$	12,810,923	$	34,725,811
Corporate debt	10,175,084		8,988,608		(67,991		)	(7,702		)	10,107,093		8,980,906
Certificates of deposits	—		201,000		—			(260		)	—		200,740
Total	$	23,239,502	$	44,204,201	$	(321,486	)	$	(296,744	)	$	22,918,016	$	43,907,457

The contractual maturity of the Company’s marketable debt securities is as follows at December 29, 2018:

	Less than One year		One to Five years		Total
U.S. government and agency backed securities	$	3,741,183	$	9,069,740	$	12,810,923
Corporate debt	2,709,074		7,398,019		10,107,093
Total	$	6,450,257	$	16,467,759	$	22,918,016

7.    Stockholders’ Equity and Stock-Based Compensation

Sale of Unregistered Common Stock

On April 20, 2017, the Company sold 7,589,000 shares of unregistered common stock to Goertek, Inc. for $24,664,250 ($3.25 per share). This represented approximately 10.1% of Kopin’s total outstanding shares of common stock as of the date of purchase. In addition, Kopin and Goertek have entered into agreements to jointly develop and commercialize a range of technologies and wearable products. Goertek is a leading innovative global technology company headquartered in Weifang, China that designs and manufactures a range of consumer electronics products for brand customers including wearables, virtual and augmented reality headsets, and audio products. The transaction was accounted for under ASC 505-30 "Treasury Stock", and the loss on the sale of the treasury stock of approximately $0.8 million was charged to retained earnings. At completion of the transaction, the U.S. government requested certain information regarding the transaction for the Committee on Foreign Investment. See Note 16. Related Party Transactions for additional discussion around agreements with Goertek.

Restricted Stock Awards

In 2010, the Company adopted a 2010 Equity Incentive Plan ("2010 Equity Plan") which authorized the issuance of shares of common stock to employees, non-employees, and the Board. The 2010 Equity Plan was a successor to the Company’s 2001 Equity Incentive Plan ("2001 Equity Plan") and has been subsequently amended to increase the number of authorized shares to 14,100,000 as of December 29, 2018. The number of shares authorized under the 2010 Equity Plan is the number of shares approved by the shareholders plus the number of shares of common stock which were available for grant under the 2001 Equity Plan, the number of shares of common stock which were the subject of awards outstanding under the 2001 Equity Plan and are forfeited, terminated, canceled or expire after the adoption of the 2010 Equity Plan and the number of shares of common stock delivered to the Company either in exercise of an 2001 Equity Plan award or in satisfaction of a tax withholding obligation. The term and vesting period for restricted stock awards granted under the 2010 Equity Plan are determined by the Board’s compensation committee. As of December 29, 2018, the Company has approximately 1.7 million shares of common stock authorized and available for issuance under the Company’s 2010 Equity Plan.

48

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The fair value of non-vested restricted common stock awards is generally the market value of the Company’s common stock on the date of grant. The non-vested restricted common stock awards require the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also require meeting either performance criteria or the Company’s stock achieving a certain price. For non-vested restricted common stock awards that solely require the recipient to remain employed with the Company, the stock compensation expense is amortized over the anticipated service period. For non-vested restricted common stock awards that require the achievement of performance criteria, the Company reviews the probability of achieving the performance goals on a periodic basis. If the Company determines that it is probable that the performance criteria will be achieved, the amount of compensation cost derived for the performance goal is amortized over the anticipated service period. If the performance criteria are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed.

	Shares		Weighted Average Grant Fair Value
Outstanding at December 26, 2015	2,192,016		$	3.82
Granted	1,663,000		2.40
Forfeited	(110,500	)	3.21
Vested	(736,842	)	3.17
Outstanding at December 31, 2016	3,007,674		3.21
Granted	1,152,000		3.40
Forfeited	(465,150	)	3.82
Vested	(1,065,250	)	2.90
Balance at December 30, 2017	2,629,274		3.31
Granted	1,549,000		2.25
Forfeited	(872,025	)	3.78
Vested	(1,093,000	)	3.05
Balance at December 29, 2018	2,213,249		$	2.51

On December 31, 2017 (fiscal year beginning 2018), the Company amended the employment agreement with our CEO Dr. John Fan to expire on December 31, 2020 and as part of the amendment issued restricted stock grants. 640,000 shares of restricted stock which will vest upon the first 20 consecutive trading day period following the grant date during which the Company's common stock trades at a price equal to or greater than $5.25, 150,000 shares of restricted stock will vest at the end of the first 20 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $6.00, and 150,000 shares of restricted common stock will vest at the end of the first 20 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $7.00. All of the grants are subject to certain acceleration events and terminate on December 31, 2020.

	For the period ended December 29, 2018
Performance price target	$	5.25		$	6.00		$	7.00
Expected volatility	48.3		%	48.3		%	48.3		%
Interest rate	1.97		%	1.97		%	1.97		%
Expected life (years)	2			2			2
Dividend yield	—		%	—		%	—		%

49

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Stock-Based Compensation

The following table summarizes stock-based compensation expense within each of the categories below as it relates to non-vested restricted common stock awards for the fiscal years 2018, 2017 and 2016 (no tax benefits were recognized):

	2018		2017		2016
Cost of product revenues	$	418,605	$	490,481	$	561,791
Research and development	725,112		799,485		527,081
Selling, general and administrative	3,647,337		1,006,165		1,336,454
Total	$	4,791,054	$	2,296,131	$	2,425,326

Unrecognized compensation expense for non-vested restricted common stock as of December 29, 2018 totaled $3.4 million and is expected to be recognized over a weighted average period of approximately two years.

8.    Concentrations of Risk

Ongoing credit evaluations of customers’ financial condition are performed and collateral, such as letters of credit, are generally not required. Customer’s accounts receivable balance as a percentage of total accounts receivable was as follows:

	Percent of Gross Accounts Receivable
Customer	December 29, 2018	December 30, 2017
Collins Aerospace	11%	*
DRS Technologies	11%	*
Scott Safety	*	14%
RealWear, Inc.	31%	10%
U.S. Army	*	43%

Note: The symbol “*” indicates that accounts receivables from that customer were less than 10% of the Company’s total accounts receivable.

Sales to significant non-affiliated customers for fiscal years 2018, 2017 and 2016, as a percentage of total revenues, is as follows:

	Sales as a Percent of Total Revenue
	Fiscal Year
Customer	2018	2017	2016
Military Customers in Total	36%	48%	24%
General Dynamics	11%	*	*
DRS Technologies	*	10%	*
Collins Aerospace	20%	10%	12%
Shenzhen Oriscape	*	*	20%
U.S. Army	*	12%	*
Funded Research and Development Contracts	20%	11%	7%

Note: The symbol “*” indicates that sales to that customer were less than 10% of the Company’s total revenues. The caption "Military Customers in Total" excludes research and development contracts.

50

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

9.    Income Taxes

The (benefit) provision for income taxes from continuing operations consists of the following for the fiscal years indicated: 

	Fiscal Year
	2018			2017			2016
Current
State	$	5,000		$	5,000		$	33,000
Foreign	25,000			(568,000		)	1,656,000
Total current provision	30,000			(563,000		)	1,689,000
Deferred
Federal	(7,307,000		)	15,461,000			(8,718,000		)
State	(360,000		)	(493,000		)	(1,264,000		)
Foreign	300,000			(187,000		)	2,308,000
Change in valuation allowance	7,367,000			(17,181,000		)	9,115,000
Total (benefit) deferred provision	—			(2,400,000		)	1,441,000
Total provision (benefit) for income taxes	$	30,000		$	(2,963,000	)	$	3,130,000

The following table sets forth the changes in Kopin's balance of unrecognized tax benefits for the year ended:

	Total
Unrecognized tax benefits at December 26, 2016	$	374,000
Gross increases—prior year tax positions	20,000
Unrecognized tax benefits at December 30, 2017	394,000
Gross increases—current year tax positions	—
Unrecognized tax benefits at December 29, 2018	$	394,000

U.S. GAAP requires applying a 'more likely than not' threshold to the recognition and derecognition of uncertain tax positions either taken or expected to be taken by Kopin's income tax returns. The total amount of our gross tax liability for tax positions that may not be sustained under a 'more likely than not' threshold amounts to $0.4 million as of December 29, 2018 and December 30, 2017. Kopin's policy regarding the classification of interest and penalties is to include these amounts as a component of income tax expense. The total amount of accrued interest and penalties related to the Company's unrecognized tax benefits was $0.5 million as of December 29, 2018 and December 30, 2017.

Net operating losses were not utilized in 2018, 2017 and 2016 to offset federal and state taxes.

51

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The actual income tax (benefit) provision reported from operations are different than those which would have been computed by applying the federal statutory tax rate to loss before income tax (benefit) provision. A reconciliation of income tax (benefit) provision from continuing operations as computed at the U.S. federal statutory income tax rate to the provision for income tax benefit is as follows:

	Fiscal Year
	2018			2017			2016
Tax provision at federal statutory rates	$	(7,515,000	)	$	(9,884,000	)	$	(6,965,000	)
State tax liability	5,000			5,000			22,000
Foreign deferred tax rate differential	(39,000		)	15,000			(678,000		)
Foreign withholding	301,000			(771,000		)	1,441,000
Outside basis in Kowon, net unremitted earnings	(468,000		)	(2,888,000		)	958,000
Permanent items	186,000			774,000			259,000
Increase in net state operating loss carryforwards	(406,000		)	(300,000		)	(502,000		)
Utilization of net operating losses for U.K. research and development refund	—			—			(142,000		)
Provision to tax return adjustments and tax rate change (1)	(76,000		)	24,833,000			(66,000		)
Tax credits	239,000			24,000			(762,000		)
Non-deductible 162M compensation limitations	13,000			199,000			—
Non-deductible equity compensation	290,000			1,901,000			(360,000		)
Uncertain tax position for transfer pricing	91,000			203,000			671,000
Other, net	45,000			107,000			139,000
Change in valuation allowance	7,364,000			(17,181,000		)	9,115,000
	$	30,000		$	(2,963,000	)	$	3,130,000

(1) Due to the Tax Act which was enacted in December 2017, our U.S. deferred tax assets and liabilities as of December 30, 2017 were re-measured to 21%. The provisional amount recorded related to the remeasurement of our deferred tax balance was approximately $25.1 million of tax expense.

Pretax foreign income from continuing operations was approximately $0.7 million for fiscal year ended 2018, pretax foreign loss from continuing operations was approximately $0.4 million for fiscal year ended 2017 and pretax foreign income from continuing operations was approximately $5.4 million for fiscal year ended 2016. Deferred income taxes are provided to recognize the effect of temporary differences between tax and financial reporting. Deferred income tax assets and liabilities consist of the following: 

	Fiscal Year
	2018			2017
Deferred tax liability:
Foreign withholding liability	$	(538,000	)	$	(812,000	)
Foreign unremitted earnings	—			(468,000		)
Intangible assets	—			(259,000		)
Deferred tax assets:
Federal net operating loss carryforwards	41,755,000			34,555,000
State net operating loss carryforwards	3,114,000			2,708,000
Foreign net operating loss carryforwards	1,259,000			1,500,000
Equity awards	444,000			55,000
Tax credits	7,231,000			7,470,000
Property, plant and equipment	640,000			544,000
Unrealized losses on investments	1,848,000			1,792,000
Other	1,707,000			3,037,000
Net deferred tax assets	57,460,000			50,122,000
Valuation allowance	(58,006,000		)	(50,642,000		)
	$	(546,000	)	$	(520,000	)

52

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The valuation allowance was approximately $58.0 million and $50.6 million at December 29, 2018 and December 30, 2017, respectively, primarily driven by U.S. net operating loss carryforwards ("NOLs") and tax credits that the Company does not believe will ultimately be realized.

On December 22, 2017, the President signed the Tax Cuts and Jobs Act of 2017 ("2017 Act") which enacted a wide range of changes to the U.S. corporate income tax system. The 2017 Act reduced the U.S. corporate statutory federal tax rate to 21% effective in 2018, eliminated the domestic manufacturing deduction benefit and introduced other tax base broadening measures, changed rules for expensing and capitalizing business expenditures, established a territorial tax system for foreign earnings as well as a minimum tax on certain foreign earnings, provided for a one-time transition tax on previously undistributed foreign earnings, and introduced new rules for the treatment of certain foreign income. Also on December 22, 2017, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin No. 118 (SAB 118), which provided companies with additional guidance on how to account for the 2017 Act in their financial statements, allowing companies to use a measurement period. As of December 30, 2017, we made a reasonable estimate of the effects on our existing deferred tax balances and the one-time transition tax on previously undistributed foreign earnings and the Company did not recognize any provisional amounts in the (benefit) provision for income taxes in accordance with SAB 118. As of December 29, 2018, we had finalized our provisional estimates for the remeasurement of our existing U.S. deferred tax balances and the one-time transition tax and did not recognize amounts in the (benefit) provision for income taxes.

Deferred tax assets and liabilities—The Company has remeasured certain deferred tax assets and liabilities, excluding those items that will be included on the Company's 2017 tax return, based on the rates the Company expects to realize the deferred tax assets and liabilities at in the future, which is generally 21%. The amount recorded related to the remeasurement of the Company's deferred tax balance was approximately $25.1 million of tax expense. At December 29, 2018, we have finalized our provisional estimate for the remeasurement of our existed deferred tax balances with no additional adjustment.

The Company recorded a reduction in the valuation allowance during 2017 of approximately $1.0 million which was previously recorded against the Company’s AMT credit. The Company expects to receive a refund of $1.0 million from our AMT credit in accordance with the Tax Act and have recorded the receivable in "Other assets" on the Company's consolidated balance sheets at December 29, 2018.

In addition to the changes described above, the 2017 Act imposes a U.S. tax on global intangible low taxed income ("GILTI") that is earned by certain foreign affiliates owned by a U.S. shareholder. The computation of GILTI is generally intended to impose tax on the earnings of a foreign corporation that are deemed to exceed a certain threshold return relative to the underlying business investment. The Company has made a policy election to treat future taxes related to GILTI as a current period expense in the reporting period in which the tax is incurred.

Foreign tax effects—The one-time transition tax is based on our total post-1986 earnings and profits (“E&P”) for which the Company has previously deferred U.S. income taxes. The Company is estimating that the Company will not have a provisional requirement amount for our one-time transition tax liability, using an estimated applicable tax rate of 15.5%, resulting in no increase in income tax expense. The Company has not yet completed our calculation of the total post-1986 foreign E&P for these foreign subsidiaries. Further, the transition tax is based in part on the amount of those earnings held in cash and other specified assets. This amount may change when the Company finalizes the calculation of post-1986 foreign E&P previously deferred from U.S. federal taxation and finalize the amounts held in cash or other specified assets. The Company also expects additional clarifying and interpretative technical guidance to be issued related to the calculation of our one-time transition tax. No additional income taxes have been provided for any remaining undistributed foreign earnings not subject to the transition tax and any additional outside basis difference inherent in these entities as these amounts continue to be indefinitely reinvested in foreign operations.

As of December 29, 2018, the Company has available for tax purposes NOLs of $198.8 million expiring 2022 through 2037. The Company has recognized a full valuation allowance on its net deferred tax assets as the Company has concluded that such assets are not more likely than not to be realized. The decrease in valuation allowance during fiscal year 2018 was a result of decreases in the federal tax rate as part of the Tax Act and a reduction in the valuation allowance as a result of deferred tax liabilities assumed as part of the acquisition of NVIS.

The Tax Act imposes a mandatory transition tax on accumulated foreign earnings and eliminates U.S. taxes on foreign subsidiary distribution. As a result, earnings in foreign jurisdictions are available for distribution to the U.S. without incremental U.S. taxes.

Under the provisions of Section 382, certain substantial changes in Kopin’s ownership may limit in the future the amount of net operating loss carryforwards that could be used annually to offset future taxable income and income tax liability.

53

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The Company’s income tax returns have not been examined by the Internal Revenue Service and are subject to examination for all years since 2001. State income tax returns are generally subject to examination for a period of three to five years after filing of the respective return. The state impact of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the states.

International jurisdictions have statutes of limitations generally ranging from three to twenty years after filing of the respective return. Years still open to examination by tax authorities in major jurisdictions include Korea (2009 onward), Japan (2009 onward), Hong Kong (2011 onward) and United Kingdom (2014 onward). The Company is not currently under examination in these jurisdictions.

10.    Accrued Warranty

The Company warrants its products against defect for 12 months, however, for certain products a customer may purchase an extended warranty. A provision for estimated future costs and estimated returns for credit relating to such warranty is recorded in the period when product is shipped and revenue recognized, and is updated as additional information becomes available. The Company’s estimate of future costs to satisfy warranty obligations is based primarily on historical warranty expense experienced and a provision for potential future product failures. Changes in the accrued warranty for fiscal years ended 2018, 2017 and 2016 are as follows:

	Fiscal Year Ended
	December 29, 2018			December 30, 2017			December 31, 2016
Beginning balance	$	649,000		$	518,000		$	518,000
Additions	159,000			328,000			440,000
Claim and reversals	(237,000		)	(197,000		)	(440,000		)
Ending Balance	$	571,000		$	649,000		$	518,000

11.    Employee Benefit Plan

The Company has an employee benefit plan pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended. In 2018, the plan allowed employees to defer an amount of their annual compensation up to a current maximum of $18,500 if they are under the age of 50 and $24,500 if they are over the age of 50. The Company matches 50% of all deferred compensation on the first 6% of each employee’s deferred compensation. The amount charged to operations in connection with this plan was approximately $0.3 million in fiscal years 2018, 2017 and 2016.

12.    Commitments and Contingencies

Leases

The Company leases various facilities. The following is a schedule of minimum rental commitments under non-cancelable operating leases at December 29, 2018:

Fiscal year ending,	Amount
2019	$	1,210,000
2020	1,112,000
2021	921,000
2022	616,000
2023	201,000
Thereafter	—
Total minimum lease payments	$	4,060,000

Amounts incurred under operating leases are recorded as rent expense on a straight-line basis. Total rent expense in the fiscal years ended 2018, 2017 and 2016 were approximately $1.4 million, $1.5 million and $1.3 million, respectively.

The Company has entered into an agreement to make a capital contribution of approximately $5.1 million (the Company's capital contribution under the agreement is $35.0 million Chinese Yuan Renminbi). The Company’s ability to make its capital contribution is subject to Chinese laws which include restrictions of direct foreign investment. Accordingly, the Company will need to make the capital contribution through its Chinese subsidiary’s operations.

54

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

13.    Litigation

The Company may engage in legal proceedings arising in the ordinary course of business. Claims, suits, investigations and proceedings are inherently uncertain and it is not possible to predict the ultimate outcome of such matters and our business, financial condition, results of operations or cash flows could be affected in any particular period.

BlueRadios, Inc. v. Kopin Corporation, Civil Action No. 16-02052-JLK (D. Col.):

On August 12, 2016, BlueRadios, Inc. ("BlueRadios") filed a complaint in the U.S. District Court for the District of Colorado, alleging that the Company breached a contract between it and BlueRadios concerning a joint venture between the Company and BlueRadios to design, develop and commercialize microdisplay products with embedded wireless technology referred to as “Golden-i”. Additionally BlueRadios alleged that the Company breached the covenant of good faith and fair dealing associated with that contract, breached its fiduciary duty to BlueRadios, and misappropriated trade secrets owned by BlueRadios in violation of Colorado law (C.R.S. § 7-74-104(4)) and the Defend Trade Secrets Act (18 U.S.C. § 1836(b)(1)). BlueRadios further alleges that the Company was unjustly enriched by its alleged misconduct, BlueRadios is entitled to an accounting to determine the amount of profits obtained by the Company as a result of its alleged misconduct, and the inventorship on at least ten patents or patent applications owned by the Company need to be corrected to list BlueRadios’ employees as inventors and thereby list BlueRadios as co-assignees of the patents. BlueRadios seeks monetary, declaratory, and injunctive relief.

On October 11, 2016, the Company filed its Answer and Affirmative Defenses. The parties are in the midst of discovery, with the close of all discovery currently set for June 14, 2019, or 120 days after a claim construction order should one be necessary. A trial date has not yet been set by the Court. The Company has not concluded a loss from this matter is probable; therefore, we have not recorded an accrual for litigation or claims related to this matter for the period ended December 29, 2018. The Company will continue to evaluate information as it becomes known and will record an estimate for losses at the time or times when it is both probable that a loss has been incurred and the amount of the loss is reasonably estimable.

55

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

14.    Segments and Disaggregation of Revenue (As Revised)

The Company’s chief operating decision maker is its Chief Executive Officer. The Company has determined it has two reportable segments, Industrial, which includes the operations that develop and manufacture its reflective display products and virtual reality systems for test and simulation products, and Kopin, which includes the operations that develop and manufacture its other products.

As noted in Note 1. Summary of Significant Accounting Policies, effective December 31, 2017, the Company adopted Topic 606 using the modified retrospective method. The comparative information has not been revised and continues to be reported under the accounting standards in effect for those periods.

Segment financial results were as follows:

Total Revenue (in thousands)	2018			2017			2016
Kopin	$	16,981		$	15,942		$	18,733
Industrial	9,116			13,585			3,909
Eliminations	(1,631		)	(1,685		)	—
Total	$	24,465		$	27,841		$	22,643
Total Intersegment Revenue (in thousands)	2018			2017			2016
Kopin	$	—		$	—		$	—
Industrial	1,631			1,685			—
Total	$	1,631		$	1,685		$	—
	2018			2017			2016
Net Loss Attributable to the Controlling Interest (in thousands)	(As Revised)1						(As Revised)1
Kopin	$	(33,768	)	$	(26,153	)	$	(22,757	)
Industrial	(766		)	1,277			(812		)
Eliminations	—			(364		)	—
Total	$	(34,534	)	$	(25,240	)	$	(23,569	)
Intersegment Loss Attributable to the Controlling Interest (in thousands)	2018			2017			2016
Kopin	$	—		$	—		$	—
Industrial	—			364			—
Total	$	—		$	364		$	—
Total Assets (in thousands)				2018			2017
Kopin				$	50,995		$	82,707
Industrial				8,554			8,615
Total				$	59,549		$	91,322

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

56

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Total long-live assets by country at December 29, 2018 and December 30, 2017 were:

Total Long-lived Assets (in thousands)	2018		2017
U.S.	$	2,101	$	2,456
United Kingdom	197		192
China	251		338
Japan	50		206
Korea	—		1,885
Total	$	2,599	$	5,077

We disaggregate our revenue from contracts with customers by geographic location and by display application, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

57

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Total revenue by geographical area for the fiscal years ended December 29, 2018, December 30, 2017 and December 31, 2016 was as follows:

	2018
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	10,799	44	%	$	3,637	15	%	$	14,436	59	%
Other Americas	49		—		74		—		123		1
Total Americas	10,848		44		3,712		15		14,559		60
Asia-Pacific	4,932		20		1,984		8		6,916		28
Europe	1,194		5		1,754		7		2,948		12
Other	7		—		35		—		42		—
Total Revenues	$	16,981	69	%	$	7,484	30	%	$	24,465	100	%
	2017
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	10,056	36	%	$	6,484	23	%	$	16,540	59	%
Other Americas	24		—		62		—		86		—
Total Americas	10,080		36		6,545		24		16,626		60
Asia-Pacific	4,006		14		1,401		5		5,406		19
Europe	1,856		7		3,954		14		5,810		21
Total Revenues	$	15,942	57	%	$	11,900	43	%	$	27,841	100	%
	2016
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	8,847	39	%	$	390	2	%	$	9,237	41	%
Other Americas	41		—		—		—		41		—
Total Americas	8,887		39		390		2		9,278		41
Asia-Pacific	7,588		33		2,260		10		9,849		43
Europe	2,258		10		1,258		6		3,516		16
Total Revenues	$	18,733	82	%	$	3,909	18	%	$	22,643	100	%

58

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Total revenue by display application for the fiscal years ended December 29, 2018, December 30, 2017 and December 31, 2016 was as follows:

	2018
(In thousands)	Kopin		Industrial		Total
Military	$	4,755	$	3,969	$	8,724
Industrial	2,969		3,096		6,066
Consumer	4,146		—		4,146
R&D	5,035		219		5,254
Other	75		200		275
Total Revenues	$	16,981	$	7,484	$	24,465
	2017
(In thousands)	Kopin		Industrial		Total
Military	$	4,400	$	9,038	$	13,438
Industrial	2,695		2,783		5,478
Consumer	4,406		—		4,406
R&D	2,938		9		2,947
Other	1,503		69		1,573
Total Revenues	$	15,942	$	11,900	$	27,841
	2016
(In thousands)	Kopin		Industrial		Total
Military	$	4,963	$	375	$	5,338
Industrial	3,128		3,168		6,296
Consumer	7,418		—		7,418
R&D	1,527		—		1,527
Other	1,697		367		2,064
Total Revenues	$	18,733	$	3,909	$	22,643

59

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

15.    Selected Quarterly Financial Information (Unaudited) (As Revised)

The following tables present Kopin’s quarterly operating results for the fiscal years ended December 29, 2018 and December 30, 2017. The information for each of these quarters is unaudited and has been prepared on the same basis as the audited consolidated financial statements. In the opinion of management, all necessary adjustments, consisting only of normal recurring adjustments, have been included to present fairly the unaudited consolidated quarterly results when read in conjunction with Kopin’s audited consolidated financial statements and related notes. These operating results are not necessarily indicative of the results of any future period.

Quarterly Periods During Fiscal Year Ended December 29, 2018: 

(in thousands, except per share data)	Three months ended March 31, 2018 (3)			Three months ended June 30, 2018			Three months ended September 29, 2018			Three months ended December 29, 2018 (4)
Total revenue	$	5,654		$	5,944		$	5,126		$	7,741
Gross profit (2)	983			974			(16		)	1,439
Loss from operations	(9,792		)	(8,992		)	(10,299		)	(10,884		)
Net loss attributable to the controlling interest	(5,536		)	(9,241		)	(9,791		)	(9,966		)
Net loss per share (1):
Basic and diluted	$	(0.08	)	$	(0.13	)	$	(0.13	)	$	(0.14	)
Weighted average number of common shares outstanding:
Basic and diluted	73,078			73,095			73,135			73,317

(1) Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.

(2) Gross profit is defined as net product revenues less cost of product revenues.

(3) Includes $2.9 million impact on net gain attributable to Kopin Corporation relating to the gain on an equity investment for the three month period ended March 31, 2018.

(4) Includes $1.3 million impact from correction adjustments. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements.

Quarterly Periods During Fiscal Year Ended December 30, 2017:

(in thousands, except per share data)	Three months ended April 1, 2017			Three months ended July 1, 2017			Three months ended September 30, 2017			Three months ended December 30, 2017 (3)
Total revenue	$	4,378		$	5,927		$	6,139		$	11,397
Gross profit (2)	816			862			1,444			3,654
Loss from operations	(8,663		)	(8,068		)	(8,605		)	(4,962		)
Net loss attributable to the controlling interest	(7,858		)	(7,332		)	(8,247		)	(1,803		)
Net loss per share (1):
Basic and diluted	$	(0.12	)	$	(0.10	)	$	(0.11	)	$	(0.02	)
Weighted average number of common shares outstanding:
Basic and diluted	64,539			70,627			72,188			72,349

(1) Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.

(2) Gross profit is defined as net product revenues less cost of product revenues.

(3) Includes $1.7 million impact on net gain attributable to Kopin Corporation relating to the gain on a warrant for the three month period ended December 30, 2017.

60

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

16.    Related Party Transactions

The Company may from time to time enter into agreements with shareholders, affiliates and other companies engaged in certain aspects of the display, electronics, optical and software industries as part of our business strategy. In addition, the wearable computing product market is relatively new and there may be other technologies the Company needs to purchase from affiliates in order to enhance its product offering.

The Company and Goertek have entered into agreements to jointly develop and commercialize a range of technologies and wearable products. These include: a mutually exclusive supply and manufacturing arrangement for a certain display product for twenty four months after mass production begins; an agreement that provides the Company with the right of first refusal to invest in certain manufacturing capacity for certain products with Goertek; an agreement whereby Goertek will provide system level original equipment manufacturing services for the Company's wearable products; an arrangement whereby the Company will supply display modules for Goertek's virtual reality and augmented reality products; and other agreements related to promotion around certain products as well as providing designs relating to head mounted displays.

The Company and RealWear, Inc. have entered into agreements where the Company has agreed to supply display modules for RealWear, Inc.'s augmented reality products. The Company has also licensed certain intellectual property to RealWear, Inc. and the Company received a 15% warrant in RealWear, Inc.'s next equity offering round, which was exercised in April 2018. The Company also received a $1.5 million license fee for the intellectual property licensed to RealWear, Inc. and the Company is entitled to receive sales-based royalties from RealWear, Inc.

During fiscal years 2018, 2017 and 2016, the Company had the following transactions with related parties:

	2018				2017				2016
	Revenue		Purchases		Revenue		Purchases		Revenue		Purchases
Goertek	$	—	$	646,135	$	—	$	727,101	$	—	$	—
RealWear, Inc.	1,220,838		—		576,644		—		—		—
	$	1,220,838	$	646,135	$	576,644	$	727,101	$	—	$	—

At December 29, 2018 and December 30, 2017, the Company had the following receivables and payables with related parties:

	December 29, 2018						December 30, 2017
	Receivables		Contract Assets		Payables		Receivables		Payables
Goertek	$	—	$	—	$	207,530	$	—	$	326,877
RealWear, Inc.	1,041,334		400,000		—		414,635		—
	$	1,041,334	$	400,000	$	207,530	$	414,635	$	326,877

17.    Valuation and Qualifying Accounts

The following table sets forth activity in Kopin's allowance for doubtful accounts:

Fiscal year ended:	Balance at Beginning of Year		Additions Charged to Income		Deductions from Reserve			Balance at End of Year
December 31, 2016	$	153,000	$	—	$	(17,000	)	$	136,000
December 30, 2017	136,000		13,000		—			149,000
December 29, 2018	$	149,000	$	268,000	$	(113,000	)	$	304,000

61

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

18.    Correction of Previously Issued Financial Statements

Subsequent to filing its Original Form 10-K, the Company identified that its consolidated financial statements were incorrect because of certain errors impacting noncontrolling interest in connection with its Korean subsidiary Kowon. Accordingly, the accompanying consolidated financial statements as of December 29, 2018 and for the three years in the period ended December 29, 2018, have been revised to correct these errors. A summary of these errors and their impact on the consolidated financial statements are as follows:

1. The Company improperly calculated the noncontrolling interest amount of Kowon when the Company made equity investments in years prior to 2015. The Company has corrected for this misstatement in the accompanying Consolidated Statements of Stockholders’ Equity, which resulted in a decrease to additional paid-in capital and an increase to noncontrolling interest of $1.2 million as of December 26, 2015. This correction impacted the respective equity categories in the accompanying Consolidated Statements of Stockholders’ Equity and Consolidated Balance Sheets for 2016, 2017 and 2018.

2. In 2016, upon recognition of a gain on sale of Kowon assets, the Company did not properly allocate the portion of the gain attributable to the noncontrolling interest in the amount of $0.1 million. The Company has corrected for this misstatement in the accompanying 2016 Consolidated Statement of Operations, which consequently impacts the accompanying Consolidated Statements of Stockholders’ Equity by increasing accumulated deficit and increasing noncontrolling interest for $0.1 million as of December 31, 2016.

3. In 2018, when the Company liquidated Kowon, it was carrying approximately $1.7 million in cumulative translation adjustments ("CTA") related to Kowon's net assets. Approximately $0.4 million of CTA was correctly reclassified into earnings in 2018, however, the remaining $1.3 million was incorrectly reclassified directly to noncontrolling interest to offset cumulative understatement in noncontrolling interest that resulted from the two prior period errors noted above. This caused the net loss in the accompanying 2018 Consolidated Statement of Operations to be overstated by $1.3 million, which the Company has corrected in the accompanying Consolidated Statements of Operations.

4. In addition, in connection with the liquidation of Kowon, the Company understated its distribution to the noncontrolling interest holder in the accompanying 2018 Consolidated Statement of Cash Flows by less than $0.1 million, which the Company has corrected in the accompanying Consolidated Statements of Cash Flows.

62

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The effects of these adjustments on the consolidated statements of stockholders’ equity are as follows:

	Addition Paid-in Capital				Accumulated Deficit						Noncontrolling Interest
	As Previously Reported	Adjustment		As Revised	As Previously Reported		Adjustment		As Revised		As Previously Reported		Adjustment		As Revised
Balance at December 26, 2015	326,558,527	(1,201,482	)	325,357,045	(190,608,671	)	—		(190,608,671	)	(256,096	)	1,201,482		945,386
Net (loss) income	—	—		—	(23,434,116	)	(134,601	)	(23,568,717	)	402,971		134,601		537,572
Balance at December 31, 2016	328,524,644	(1,201,482	)	327,323,162	(214,042,787	)	(134,601	)	(214,177,388	)	141,957		1,336,083		1,478,040
Balance at December 30, 2017	331,119,340	(1,201,482	)	329,917,858	(240,121,901	)	(134,601	)	(240,256,502	)	(719,422	)	1,336,083		616,661
Distribution to noncontrolling interest holder	—	—		—	—		—		—		636,978		(1,336,083	)	(699,105	)
Net (loss) income	—	—		—	(35,869,625	)	1,336,083		(34,533,542	)	51,050		—		51,050
Balance at December 29, 2018	335,692,879	(1,201,482	)	334,491,397	(272,932,143	)	1,201,482		(271,730,661	)	(149,053	)	—		(149,053	)

63

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The effects of these adjustments on the consolidated statements of operations are as follows:

	As Previously Reported			Adjustment			As Revised
2018
Foreign currency transaction gains (losses)	$	(166,829	)	$	1,336,083		$	1,169,254
2016
Net income attributable to noncontrolling interest	402,971			134,601			537,572
Net loss attributable to Kopin Corporation	$	(23,434,116	)	$	(134,601	)	$	(23,568,717	)

The effects of these adjustments on the consolidated statements of cash flows are as follows:

	As Previously Reported			Adjustment			As Revised
2018
Cash flows from operating activities:
Net loss	$	(35,818,575	)	$	1,336,083		$	(34,482,492	)
Foreign currency (gains) losses	177,469			(1,273,956		)	(1,096,487		)
Cash flows from financing activities
Distribution to noncontrolling interest holder	$	(636,978	)	$	(62,127	)	$	(699,105	)

The above referenced adjustments do not impact the consolidated statement of operations for the fiscal year ended December 30, 2017 or the consolidated statements of cash flows for the fiscal years ended December 30, 2017 and December 31, 2016.

Although the Company does not believe such misstatements are material to the previously issued consolidated financial statements, for comparability purposes, the Company has revised the previously issued consolidated financial statements to correct the misstatements.

64

INDEX TO EXHIBITS

Exhibits
3.1	Amended and Restated Certificate of Incorporation filed as an exhibit to Registration Statement on Form S-1, File No. 33-57450, and incorporated herein by reference.
3.2	Amendment to Certificate of Incorporation filed as an exhibit to Quarterly Report on Form 10-Q for the quarterly period ended July 1, 2000 and incorporated herein by reference.
3.3	Amendment to Certificate of Incorporation filed as an exhibit to Quarterly Report on Form 10-Q for the quarterly period ended July 1, 2000 and incorporated herein by reference.
3.4	Fifth Amended and Restated By-laws filed as an exhibit to Current Report on Form 8-K filed on July 18, 2016 and incorporated herein by reference.
4	Specimen Certificate of Common Stock filed as an exhibit to Registration Statement on Form S-1, File No. 33-45853, and incorporated herein by reference.
10.1	Form of Employee Agreement with Respect to Inventions and Proprietary Information filed as an exhibit to Registration Statement on Form S-1, File No. 33-45853, and incorporated herein by reference.
10.2*	Kopin Corporation 2001 Equity Incentive Plan filed as an appendix to Proxy Statement filed on April 20, 2001 and incorporated herein by reference. *
10.3*	Kopin Corporation 2001 Equity Incentive Plan Amendment filed as an exhibit to Registration Statement on Form S-8 filed on August 16, 2002 and incorporated herein by reference. *
10.4*	Kopin Corporation 2001 Equity Incentive Plan Amendment filed as an exhibit to Registration Statement on Form S-8 filed on March 15, 2004 and incorporated herein by reference. *
10.5*	Kopin Corporation 2001 Equity Incentive Plan Amendment filed as an exhibit to Registration Statement on Form S-8 filed on May 10, 2004 and incorporated herein by reference. *
10.6*	Kopin Corporation 2001 Equity Incentive Plan Amendment filed as an exhibit to Registration Statement on Form S-8 filed on April 15, 2008 and incorporated herein by reference. *
10.7*	Kopin Corporation 2001 Supplemental Equity Incentive Plan filed as an exhibit to Quarterly Report on Form 10-Q for the quarterly period ended July 1, 2000 and incorporated herein by reference. *
10.8*	Form of Key Employee Stock Purchase Agreement filed as an exhibit to Registration Statement on Form S-1, File No. 33-45853, and incorporated herein by reference. *
10.9	License Agreement by and between the Company and Massachusetts Institute of Technology dated April 22, 1985, as amended, filed as an exhibit to Registration Statement on Form S-1, File No. 33-45853, and incorporated herein by reference.
10.10	Facility Lease, by and between the Company and Massachusetts Technology Park Corporation, dated October 15, 1993 filed as an exhibit to Annual Report on Form 10-K for the fiscal year ended December 31, 1993 and incorporated herein by reference.
10.11	Joint Venture Agreement, by and among the Company, Kowon Technology Co., Ltd., and Korean Investors, dated as of March 3, 1998 filed as an exhibit to Annual Report on Form 10-Q for the quarterly period ended June 27, 1998 and incorporated herein by reference.
10.12*	Ninth Amended and Restated Employment Agreement between the Company and Dr. John C.C. Fan, dated as of December 31, 2017 *
10.13*	Kopin Corporation Form of Stock Option Agreement under 2001 and 2010 Equity Incentive Plans filed as an exhibit to Annual Report on Form 10-K for the fiscal year ended December 25, 2004 and incorporated herein by reference. *
10.14*	Kopin Corporation 2001 and 2010 Equity Incentive Plan Form of Restricted Stock Purchase Agreement filed as an exhibit to Annual Report on Form 10-K for the fiscal year ended December 25, 2004 and incorporated herein by reference. *
10.15*	Kopin Corporation Fiscal Year 2012 Incentive Bonus Plan filed as an exhibit to Annual Report on Form 10-K for the fiscal year ended December 31, 2011 and incorporated herein by reference. *
10.16	Kopin Corporation 2010 Equity Incentive Plan filed with the Company's Definitive Proxy Statement on Schedule 14 filed as of April 5, 2013 and incorporated by reference herein.
10.17	Purchase Agreement, dated January 10, 2013, by and among Kopin Corporation, IQE KC, LLC and IQE plc filed as an exhibit to Current Report on Form 8-K on January 10, 2013 and incorporated by reference herein.
21.1	Subsidiaries of Kopin Corporation
23.1	Consent of Independent Registered Public Accounting Firm

65

31.1	Chief Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Chief Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Chief Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Chief Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.0	The following materials from the Company’s Annual Report on Form 10-K/A for the fiscal year ended December 29, 2018, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Loss, (iv) Consolidated Statements of Stockholder's Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements, tagged as blocks of text.
*	Management contract or compensatory plan required to be filed as an Exhibit to this Form 10-K/A.

66

SIGNATURES

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

	KOPIN CORPORATION
Dated: November 7, 2019	By:	/s/    RICHARD A. SNEIDER
		Richard A. Sneider Treasurer and Chief Financial Officer (Principal Financial and Accounting Officer)

67

EX-23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statements Nos. 333-46613, 333-92395, 333-49890, 333-73208, 333-98285, 333-113614, 333-115342, 333-150258, 333-173066, 333-190524, 333-217070, 333-219870, and 333-225472 on Form S-8, and Registration Statement No. 333-228549 on Form S-3, of our report relating to the consolidated financial statements of Kopin Corporation and subsidiaries (the “Company”) dated March 13, 2019 (November 7, 2019, as to the effects of the errors discussed in Note 18 to the consolidated financial statements), which report expresses an unqualified opinion and includes explanatory paragraphs relating to going concern and the Company’s adoption of a new accounting standard, and our report relating to the effectiveness of the Company’s internal control over financial reporting dated March 13, 2019 (November 7, 2019, as to the effects of the material weakness described in Management’s Annual Report on Internal Control over Financial Reporting (as revised)), which report expresses an adverse opinion on the effectiveness of the Company’s internal control over financial reporting because of a material weakness, appearing in the Annual Report on Form 10-K/A of Kopin Corporation for the year ended December 29, 2018.

/s/ Deloitte & Touche LLP

Boston, Massachusetts

November 7, 2019

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, John C.C. Fan, certify that:

1. I have reviewed this Amendment No. 1 to the annual report on Form 10-K/A for the period ended December 28, 2019, of Kopin Corporation;

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: November 7, 2019

/s/    John C. C. Fan

John C.C. Fan

President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Richard A. Sneider, certify that:

1. I have reviewed this Amendment No. 1 to the annual report on Form 10-K/A for the period ended December 28, 2019, of Kopin Corporation;

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: November 7, 2019

/s/    Richard A. Sneider 

Richard A. Sneider

Chief Financial Officer

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

The certification set forth below is hereby made solely for the purpose of satisfying the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 and may not be relied upon or used for any other purposes.

In connection with Amendment No. 1 the Annual Report of Kopin Corporation (the “Company”) on Form 10-K/A for the fiscal year ended December 29, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John C.C. Fan, President and 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 to my knowledge: (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.

A signed original of this written statement required by Section 906 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Date:	November 7, 2019
By:	/s/    John C. C. Fan
	John C.C. Fan     President and 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

The certification set forth below is hereby made solely for the purpose of satisfying the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 and may not be relied upon or used for any other purposes.

In connection with Amendment No. 1 to the Annual Report of Kopin Corporation (the “Company”) on Form 10-K/A for the fiscal year ended December 29, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Richard A. Sneider, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (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.

A signed original of this written statement required by Section 906 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Date:	November 7, 2019
By:	/s/    Richard A. Sneider
	Richard A. Sneider     Chief Financial Officer

XML

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 29, 2018

Dec. 30, 2017

Accounting Policies [Abstract]

Substantial Doubt about Going Concern [Text Block]

The Company has incurred net losses of $34.5 million, $25.4 million and $23.0 million for the fiscal years ended 2018, 2017 and 2016, respectively, and net cash outflows from operations of $28.1 million, $25.9 million and $26.2 million for the fiscal years ended 2018, 2017 and 2016, respectively. In addition, the Company has continued to experience a significant decline in its cash and cash equivalents and marketable debt securities, which was primarily a result of funding operating losses, of which a significant component relates to the Company’s ongoing investments in the research and development of Wearable products. These negative financial conditions raise substantial doubt regarding the Company’s ability to continue as a going concern.

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and a majority owned 80% subsidiary, eMDT America Inc. ("eMDT"), located in California (collectively the Company). Net loss attributable to noncontrolling interest in the Company's Consolidated Statement of Operations represents the portion of the results of operations of which is allocated to the shareholders of the equity interests not owned by the Company. All intercompany transactions and balances have been eliminated.

Revenue Recognition

Revenue Recognition - 2018

The Company adopted ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) effective December 31, 2017 and applied the modified retrospective method. The Company recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of accumulated deficit. The comparative information has not been revised and continues to be reported under the accounting standards in effect for those periods. The Company expects the impact of the adoption of the new standard to be material to the Company's results of operations on an ongoing basis. Significant changes to the Company's accounting policies as a result of adopting Topic 606 are discussed below.

Substantially all of our product revenues are either derived from the sales of components for use in military applications or our wearable technology components that can be integrated to create industrial and consumer headset systems. We also have development contracts for the design, manufacture and modification of products for the U.S. government or a prime contractor

for the U.S. government or for a customer that sells into the industrial or consumer markets. The Company's contracts with the U.S. government are typically subject to the Federal Acquisition Regulations (“FAR”) and are priced based on estimated or actual costs of producing goods. The FAR provides guidance on the types of costs that are allowable in establishing prices for goods provided under U.S. government contracts. The pricing for non-U.S. government contracts is based on the specific negotiations with each customer.

Our fixed-price contracts with the U.S. government or other customers may result in revenue recognized in excess of amounts currently billed. We disclose the excess of revenues over amounts actually billed as Contract assets and unbilled receivables on the balance sheet. Amounts billed and due from our customers are classified as Accounts receivable on the balance sheets. In some instances, the U.S. government retains a small portion of the contract price until completion of the contract. The portion of the payments retained until final contract settlement is not considered a significant financing component because the intent is to protect the customer. For contracts with the U.S. government, we typically receive interim payments either as work progresses or by achieving certain milestones or based on a schedule in the contract. We recognize a liability for these advance payments in excess of revenue recognized and present it as Contract liabilities and billings in excess of revenue earned on the balance sheets. The advanced payment typically is not considered a significant financing component because it is used to meet working capital demands that can be higher in the early stages of a contract and to protect us from the other party failing to adequately complete some or all of its obligations under the contract. For industrial and consumer purchase orders, we typically receive payments within 30 to 60 days of shipments of the product, although for some purchase orders, we may require an advanced payment prior to shipment of the product.

To determine the proper revenue recognition method for contracts with the same customer, we evaluate whether two or more contracts should be combined and accounted for as one single contract and whether the combined or single contract should be accounted for as more than one performance obligation. For most of our development contracts and contracts with the U.S government, the customer contracts with us to provide a significant service of integrating a set of components into a single unit. Hence, the entire contract is accounted for as one performance obligation. Less frequently, however, we may promise to provide distinct goods or services within a contract in which case we separate the contract into more than one performance obligation. If a contract is separated into more than one performance obligation, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. In cases where we sell standard products, the observable standalone sales are used to determine the standalone selling price.

The Company recognizes revenue from a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.

Commencing in 2018 for certain contracts with the U.S. government, the Company recognizes revenue over time as we perform because of continuous transfer of control to the customer and the lack of an alternative use for the product. The continuous transfer of control to the customer is supported by liability clauses in the contract that allow the U.S. government to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. For contracts with commercial customers, while the contract may have a similar liability clause, our products historically have an alternative use and thus, revenue is recognized at a point in time.

In situations where control transfers over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. We generally use the cost-to-cost approach to measure the extent of progress towards completion of the performance obligation for our contracts because we believe it best depicts the transfer of assets to the customer. Under the cost-to-cost measure approach, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recorded proportionally as costs are incurred.

Accounting for design, development and production contracts requires judgment relative to assessing risks, estimating contract revenues and costs, and making assumptions for schedule and technical issues. Due to the size and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. We have to make assumptions regarding the number of labor hours required to complete a task, the complexity of the work to be performed, the availability and cost of materials, and performance by our subcontractors. For contract change orders, claims or similar items, we apply judgment in estimating the amounts and assessing the potential for realization. These amounts are only included in contract value when they can be reliably estimated and realization is considered probable. If our estimate of total contract costs or our determination of whether the customer agrees that a milestone is achieved is incorrect, our revenue could be overstated or understated and the profits or loss reported could be subject to adjustment.

For our commercial customers, the Company's revenue is recognized when obligations under the terms of a contract with our customer is satisfied and the Company transfers control of the products or services, which is generally upon delivery to the customer. Revenue is recorded as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Provisions for product returns and allowances are reductions in the transaction price and are recorded in the same period as the related revenues. We analyze historical returns, current economic trends and changes in customer demand when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for stocking of inventory. Sales, value add and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.

The rights and benefits to the Company's intellectual property are conveyed to certain customers through technology license agreements. These agreements may include other performance obligations including the sale of product to the customer. When the license is distinct from other obligations in the agreement, the Company treats the license and other performance obligations as separate performance obligations. Accordingly, the license is recognized at a point in time or over time based on the standalone selling price. The sale of materials is recognized at a point in time, which occurs with the transfer of control of the Company's products or services. In certain instances, the Company is entitled to sales-based royalties under license agreements. These sales-based royalties are recognized when they are earned. Revenues from sales-based royalties under license agreements are shown under Research and development and other revenues on the Company's Consolidated Statements of Operations.

Revenue Recognition - 2017

We recognize revenue if four basic criteria have been met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred and services rendered; (3) the price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. We do not recognize revenue for products prior to customer acceptance unless we believe the product meets all customer specifications and has a history of consistently achieving customer acceptance of the product. Provisions for product returns and allowances are recorded in the same period as the related revenues. We analyze historical returns, current economic trends and changes in customer demand and acceptance of product when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for stocking of inventory. We delay revenue recognition for our estimate of distributor claims of right of return on unsold products based upon our historical experience with our products and specific analysis of amounts subject to return based upon discussions with our distributors or their customers.

We recognize revenues from long-term research and development government contracts on the percentage-of-completion method of accounting as work is performed, based upon the ratio of costs or hours already incurred to the estimated total cost of completion or hours of work to be performed. Revenue recognized at any point in time is limited to the amount funded by the U.S. government or contracting entity. We recognize revenue for product development and research contracts that have established prices for distinct phases when delivery and acceptance of the deliverable for each phase has occurred. In some instances, we are contracted to create a deliverable which is anticipated to go into full production. In those cases, we discontinue the percentage-of-completion method after formal qualification of the deliverable has been completed and revenue is then recognized based on the criteria established for sale of products. In certain instances, qualification may be achieved and delivery of production units may commence however our customer may have either identified new issues to be resolved or wish to incorporate a newer display technology. In these circumstances new units delivered will continue to be accounted for under the criteria established for sale of products. Under certain of our research and development contracts, we recognize revenue using a milestone methodology. This revenue is recognized when we achieve specified milestones based on our past performance.

We classify amounts earned on contracts in progress that are in excess of amounts billed as unbilled receivables and we classify amounts received in excess of amounts earned as billings in excess of revenues earned. We invoice based on dates specified in the related agreement or in periodic installments based upon our invoicing cycle. We recognize the entire amount of an estimated ultimate loss in our financial statements at the time the loss on a contract becomes known.

Accounting for design, development and production contracts requires judgment relative to assessing risks, estimating contract revenues and costs, and making assumptions for schedule and technical issues. Due to the size and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. We have to make assumptions regarding the number of labor hours required to complete a task, the complexity of the work to be performed, the availability and cost of materials, and performance by our subcontractors. For contract change orders, claims or similar items, we apply judgment in estimating the amounts and assessing the potential for realization. These amounts are only included in contract value when they can be reliably estimated and realization is considered probable. We

have accounting policies in place to address these as well as other contractual and business arrangements to properly account for long-term contracts. If our estimate of total contract costs or our determination of whether the customer agrees that a milestone is achieved is incorrect, our revenue could be overstated and profits would be negatively impacted.

Research and Development Costs

Research and Development Costs

Research and development expenses are incurred in support of internal display product development programs or programs funded by agencies or prime contractors of the U.S. government and commercial partners. Research and development costs include staffing, purchases of materials and laboratory supplies, circuit design costs, fabrication and packaging of experimental display products, and overhead, and are expensed immediately.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all highly liquid, short-term debt instruments with original maturities of three months or less to be cash equivalents.

Inventory

Inventory

Inventories are stated at standard cost adjusted to approximate the lower of cost (first-in, first-out method) or net realizable value. The Company adjusts inventory carrying value for estimated obsolescence equal to the difference between the cost of inventory and the estimated net realizable value based upon assumptions about future demand and market conditions. The Company fully reserves for inventories and non-cancellable purchase orders for inventory deemed obsolete. The Company performs periodic reviews of inventory items to identify excess inventories on hand by comparing on-hand balances to anticipated usage using recent historical activity as well as anticipated or forecasted demand. If estimates of customer demand diminish further or market conditions become less favorable than those projected by the Company, additional inventory adjustments may be required.

We regularly review inventory quantities on-hand and we write down inventory based on excess or obsolete inventories determined primarily by future anticipated demand for our products. Inventory write-downs are measured as the difference between the cost of the inventory and net realizable value, based upon assumptions about future demand, which are inherently difficult to assess and dependent on market conditions. At the point of a loss recognition, a new, lower cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established basis.

Inventory consists of the following at December 29, 2018 and December 30, 2017:

	2018		2017
Raw materials	$	2,548,139	$	2,070,153
Work-in-process	1,526,552		1,829,805
Finished goods	722,547		1,180,839
	$	4,797,238	$	5,080,797

Property, Plant and Equipment

Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets, generally 3 to 10 years. Leasehold improvements and leased equipment are amortized over the shorter of the term of the lease or the useful life of the improvement or equipment. As discussed below, obligations for asset retirement are accrued at the time property, plant and equipment is initially purchased or as such obligations are generated from use.

Product Warranty

Product Warranty

The Company generally sells products with a limited warranty of product quality and a limited indemnification of customers against intellectual property infringement claims related to the Company’s products. The Company accrues for known warranty and indemnification issues if a loss is probable and can be reasonably estimated, and accrues for estimated incurred but unidentified issues based on historical activity. Accrued warranty costs and warranty claims are not material in the periods presented.

Asset Retirement Obligations

Asset Retirement Obligations

The Company recorded asset retirement obligations ("ARO") liabilities of $0.3 million at December 29, 2018 and December 30, 2017. This represents the legal obligations associated with retirement of the Company’s assets when the timing and/or method of settling the obligation are conditional on a future event that may or may not be within the control of the Company. Changes in ARO liabilities for fiscal years 2018 and 2017 are as follows:

	2018			2017
Beginning balance	$	269,877		$	246,922
Exchange rate change	(15,779		)	22,955
Ending balance	$	254,098		$	269,877

Income Taxes

Income Taxes

The consolidated financial statements reflect provisions for federal, state, local and foreign income taxes. The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, as well as operating loss and tax credit carryforwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carryforwards 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. The Company provides valuation allowances if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Foreign Currency

Foreign Currency

Assets and liabilities of non-U.S. operations where the functional currency is other than the U.S. dollar are translated from the functional currency into U.S. dollars at year end exchange rates, and revenues and expenses are translated at average rates prevailing during the year. Resulting translation adjustments are accumulated as part of accumulated other comprehensive income. Transaction gains or losses are recognized in income or loss in the period in which they occur.

Net (Loss) Income Per Share

Net Loss Per Share

Basic net loss per share is computed using the weighted-average number of shares of common stock outstanding during the period less any unvested restricted shares. Diluted net loss per share is calculated using weighted-average shares outstanding and contingently issuable shares, less weighted-average shares reacquired during the period. The net outstanding shares are adjusted for the dilutive effect of shares issuable upon the assumed conversion of the Company’s common stock equivalents, which consist of outstanding stock options and unvested restricted stock.

The following were not included in weighted-average common shares outstanding-diluted because they are anti-dilutive or performance conditions have not been met at the end of the period:

	2018	2017	2016
Nonvested restricted common stock	2,213,249	2,629,274	3,007,674

Concentration of Credit Risk

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk other than marketable securities consist principally of trade accounts receivable. Trade receivables are primarily derived from sales to manufacturers of consumer electronic devices and wireless components or military applications. The Company sells its products to customers worldwide and generally does not require collateral. The Company maintains a reserve for potential credit losses.

The Company primarily invests its excess cash in government backed and corporate debt securities that management believes to be of high credit worthiness, which bear lower levels of relative credit risk. The Company relies on rating agencies to ascertain the credit worthiness of its marketable securities and, where applicable, guarantees made by the Federal Deposit Insurance Company.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Financial instruments consist of marketable debt securities, accounts receivable and certain current liabilities. These assets (excluding marketable securities which are recorded at fair value) and liabilities are carried at cost, which approximates fair value.

Recognition and Measurement of Financial Assets and Liabilities

Marketable Securities, Policy [Policy Text Block]

Marketable Debt Securities

Marketable debt securities consist primarily of commercial paper, medium-term corporate notes, and U.S. government and agency backed securities. The Company classifies these marketable debt securities as available-for-sale at fair value in “Marketable debt securities, at fair value”. The Company's investment in GCS Holdings is included in "Other Assets" as available-for-sale and at fair value. The Company records the amortization of premium and accretion of discounts on marketable debt securities in the results of operations.

The Company uses the specific identification method as a basis for determining cost and calculating realized gains and losses with respect to marketable debt securities. The gross gains and losses realized related to sales and maturities of marketable debt securities were not material during the fiscal years ended 2018, 2017 and 2016.

Other-than-Temporary Impairments

The Company conducts a review of its marketable debt securities on a quarterly basis for the presence of other-than-temporary impairment ("OTTI"). The Company assesses whether OTTI is present when the fair value of a debt security is less than its amortized cost basis at the balance sheet date. Under these circumstances OTTI is considered to have occurred (1) if the Company intends to sell the security before recovery of its amortized cost basis; (2) if it is “more likely than not” the Company will be required to sell the security before recovery of its amortized cost basis; or (3) the present value of expected cash flows is not sufficient to recover the entire amortized cost basis.

The Company further estimates the amount of OTTI resulting from a decline in the creditworthiness of the issuer (credit-related OTTI) and the amount of non credit-related OTTI. Non credit-related OTTI can be caused by such factors as market illiquidity. Credit-related OTTI is recognized in earnings while non credit-related OTTI on securities not expected to be sold is

recognized in other comprehensive income (loss). The Company did not record any OTTI for the fiscal years 2018, 2017 and 2016.

Stock-Based Compensation

Stock-Based Compensation

The fair value of nonvested restricted common stock awards is generally the quoted price of the Company’s equity shares on the date of grant. The nonvested restricted common stock awards require the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also require meeting either performance criteria or market condition. The performance criteria primarily consist of the achievement of established milestones. For nonvested restricted common stock awards which solely require the recipient to remain employed with the Company, the stock compensation expense is amortized over the anticipated service period. For nonvested restricted common stock awards which require the achievement of performance criteria, the Company reviews the probability of achieving the performance goals on a periodic basis. If the Company determines that it is probable that the performance criteria will be achieved, the amount of compensation cost derived for the performance goal is amortized over the service period. If the performance criteria are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed. The Company recognizes compensation costs on a straight-line basis over the requisite service period for time vested awards.

The value of restricted stock grants that vest based on market conditions is computed on the date of grant using the Monte Carlo model. The fair value of stock option awards is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. There were no stock options granted in fiscal years 2018, 2017 or 2016.

Comprehensive Income, Policy [Policy Text Block]

Comprehensive Loss

Comprehensive loss is the total of net (loss) income and all other non-owner changes in equity including such items as unrealized holding (losses) gains on marketable equity and debt securities classified as available-for-sale and foreign currency translation adjustments.

The components of accumulated other comprehensive income are as follows:

	Cumulative Translation Adjustment			Unrealized holding (loss) gain on marketable securities			Reclassifications of gain (loss) in net loss			Accumulated Other Comprehensive Income
Balance as of December 26, 2015	$	566,025		$	205,749		$	—		$	771,774
Changes during year	814,017			33,464			(48,284		)	799,197
Balance as of December 31, 2016	1,380,042			239,213			(48,284		)	1,570,971
Changes during year	1,851,664			148,520			(6,376		)	1,993,808
Balance as of December 30, 2017	3,231,706			387,733			(54,660		)	3,564,779
Changes during year	(1,794,768		)	(264,949		)	49,525			(2,010,192		)
Balance as of December 29, 2018	$	1,436,938		$	122,784		$	(5,135	)	$	1,554,587

Impairment Long-Lived Assets

Impairment of Long-Lived Assets

The Company periodically reviews the carrying value of its long-lived assets to determine if facts and circumstances suggest that they may be impaired or that the amortization or depreciation period may need to be changed. The carrying value of a long-lived asset is considered impaired when the anticipated identifiable undiscounted cash flows from such asset are less than its carrying value. For assets that are to be held and used, impairment is measured based upon the amount by which the carrying amount of the asset exceeds its fair value.

Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements

Leases

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize a right-of-use asset and lease liability for most lease arrangements. The new standard is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which allows for an additional transition method under the modified retrospective approach for the adoption of Topic 842. The two permitted transition methods are now: (1) to apply the new lease requirements at the beginning of the earliest period presented, and (2) to apply the new lease requirements at the effective date. Under both transition methods there is a cumulative effect adjustment. We intend to adopt the standard on the effective date of December 30, 2018 by applying the new lease requirements at the effective date. We also intend to elect the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allows us to carry forward the historical lease classification. We have evaluated the changes from this ASU to our future financial reporting and disclosures, and have designed and implemented related processes and controls to address these changes. We expect the standard will result in the recognition of right-of-use assets of $3.5 million to $4.0 million and lease liabilities of $3.5 million to $4.0 million as of December 30, 2018, with immaterial changes to other balance sheet accounts. The standard will have no impact on our results of operations or liquidity. In addition, new disclosures will be provided to enable users to assess the amount, timing and uncertainty of cash flows arising from leases.

Other new pronouncements issued but not effective until after December 29, 2018 are not expected to have a material impact on our financial position, results of operations or liquidity.

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Selected Quarterly Financial Information (Unaudited)

12 Months Ended

Dec. 29, 2018

Quarterly Financial Information Disclosure [Abstract]

Selected Quarterly Financial Information (Unaudited)

Selected Quarterly Financial Information (Unaudited) (As Revised)

The following tables present Kopin’s quarterly operating results for the fiscal years ended December 29, 2018 and December 30, 2017. The information for each of these quarters is unaudited and has been prepared on the same basis as the audited consolidated financial statements. In the opinion of management, all necessary adjustments, consisting only of normal recurring adjustments, have been included to present fairly the unaudited consolidated quarterly results when read in conjunction with Kopin’s audited consolidated financial statements and related notes. These operating results are not necessarily indicative of the results of any future period.

Quarterly Periods During Fiscal Year Ended December 29, 2018: 

(in thousands, except per share data)	Three months ended March 31, 2018 (3)			Three months ended June 30, 2018			Three months ended September 29, 2018			Three months ended December 29, 2018 (4)
Total revenue	$	5,654		$	5,944		$	5,126		$	7,741
Gross profit (2)	983			974			(16		)	1,439
Loss from operations	(9,792		)	(8,992		)	(10,299		)	(10,884		)
Net loss attributable to the controlling interest	(5,536		)	(9,241		)	(9,791		)	(9,966		)
Net loss per share (1):
Basic and diluted	$	(0.08	)	$	(0.13	)	$	(0.13	)	$	(0.14	)
Weighted average number of common shares outstanding:
Basic and diluted	73,078			73,095			73,135			73,317

(1) Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.

(2) Gross profit is defined as net product revenues less cost of product revenues.

(3) Includes $2.9 million impact on net gain attributable to Kopin Corporation relating to the gain on an equity investment for the three month period ended March 31, 2018.

(4) Includes $1.3 million impact from correction adjustments. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements.

Quarterly Periods During Fiscal Year Ended December 30, 2017:

(in thousands, except per share data)	Three months ended April 1, 2017			Three months ended July 1, 2017			Three months ended September 30, 2017			Three months ended December 30, 2017 (3)
Total revenue	$	4,378		$	5,927		$	6,139		$	11,397
Gross profit (2)	816			862			1,444			3,654
Loss from operations	(8,663		)	(8,068		)	(8,605		)	(4,962		)
Net loss attributable to the controlling interest	(7,858		)	(7,332		)	(8,247		)	(1,803		)
Net loss per share (1):
Basic and diluted	$	(0.12	)	$	(0.10	)	$	(0.11	)	$	(0.02	)
Weighted average number of common shares outstanding:
Basic and diluted	64,539			70,627			72,188			72,349

(1) Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.

(2) Gross profit is defined as net product revenues less cost of product revenues.

(3)

Includes $1.7 million impact on net gain attributable to Kopin Corporation relating to the gain on a warrant for the three month period ended December 30, 2017.

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Valuation and Qualifying Accounts (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016	Dec. 26, 2015
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]
Allowance for Doubtful Accounts Receivable	$ 304,000	$ 149,000	$ 136,000	$ 153,000
Allowance for Doubtful Accounts Receivable, Period Increase (Decrease)	268,000	13,000	0
Allowance for Doubtful Accounts Receivable, Recoveries	$ (113,000)	$ 0	$ (17,000)

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Segments and Disaggregation of Revenue (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 29, 2018	Sep. 29, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Segment Reporting Information [Line Items]
Revenues	$ (7,741,000)	$ (5,126,000)	$ (5,944,000)	$ (5,654,000)	$ (11,397,000)	$ (6,139,000)	$ (5,927,000)	$ (4,378,000)	$ (24,465,005)	$ (27,841,490)	$ (22,642,566)
Net Income (Loss) Attributable to Parent	(9,966,000)	$ (9,791,000)	$ (9,241,000)	$ (5,536,000)	(1,803,000)	$ (8,247,000)	$ (7,332,000)	$ (7,858,000)	(34,533,542)	(25,240,482)	(23,568,717)
Total assets from continuing operations	59,549,111				91,322,490				59,549,111	91,322,490
Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									(16,981,000)	(15,942,000)	(18,733,000)
Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									(7,484,000)	(11,900,000)	(3,909,000)
Operating Segments [Member]
Segment Reporting Information [Line Items]
Total assets from continuing operations	59,549,000				91,322,000				59,549,000	91,322,000
Operating Segments [Member] | Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									(16,981,000)	(15,942,000)	(18,733,000)
Net Income (Loss) Attributable to Parent									(33,768,000)	(26,153,000)	(22,757,000)
Total assets from continuing operations	50,995,000				82,707,000				50,995,000	82,707,000
Operating Segments [Member] | Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									(9,116,000)	(13,585,000)	(3,909,000)
Net Income (Loss) Attributable to Parent									(766,000)	1,277,000	(812,000)
Total assets from continuing operations	8,554,000				8,615,000				8,554,000	8,615,000
Intersegment Eliminations [Member]
Segment Reporting Information [Line Items]
Revenues									1,631,000	1,685,000	0
Net Income (Loss) Attributable to Parent									0	(364,000)	0
Intersegment Eliminations [Member] | Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									0	0	0
Net Income (Loss) Attributable to Parent									0	0	0
Intersegment Eliminations [Member] | Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									1,631,000	1,685,000	0
Net Income (Loss) Attributable to Parent									0	(364,000)	0
Industrial Customers [Member]
Segment Reporting Information [Line Items]
Revenues									(6,066,000)	(5,478,000)	(6,296,000)
Industrial Customers [Member] | Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									(2,969,000)	(2,695,000)	(3,128,000)
Industrial Customers [Member] | Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									(3,096,000)	(2,783,000)	(3,168,000)
Consumer Customers [Member]
Segment Reporting Information [Line Items]
Revenues									(4,146,000)	(4,406,000)	(7,418,000)
Consumer Customers [Member] | Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									(4,146,000)	(4,406,000)	(7,418,000)
Consumer Customers [Member] | Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									0	0	0
Research and Development [Member]
Segment Reporting Information [Line Items]
Revenues									(5,254,000)	(2,947,000)	(1,527,000)
Research and Development [Member] | Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									(5,035,000)	(2,938,000)	(1,527,000)
Research and Development [Member] | Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									(219,000)	(9,000)	0
All Other Customers [Member]
Segment Reporting Information [Line Items]
Revenues									(275,000)	(1,573,000)	(2,064,000)
All Other Customers [Member] | Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									(75,000)	(1,503,000)	(1,697,000)
All Other Customers [Member] | Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									(200,000)	(69,000)	(367,000)
Military Customers in Total
Segment Reporting Information [Line Items]
Revenues									(8,724,000)	(13,438,000)	(5,338,000)
Military Customers in Total | Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									(4,755,000)	(4,400,000)	(4,963,000)
Military Customers in Total | Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									(3,969,000)	(9,038,000)	(375,000)
Property, Plant and Equipment [Member]
Segment Reporting Information [Line Items]
Long lived assets	2,599,000				5,077,000				2,599,000	5,077,000
UNITED STATES
Segment Reporting Information [Line Items]
Revenues									(14,436,000)	(16,540,000)	(9,237,000)
UNITED STATES | Kopin [Member]
Segment Reporting Information [Line Items]
Revenues									(10,799,000)	(10,056,000)	(8,847,000)
UNITED STATES | Industrial [Member]
Segment Reporting Information [Line Items]
Revenues									(3,637,000)	(6,484,000)	$ (390,000)
UNITED STATES | Property, Plant and Equipment [Member]
Segment Reporting Information [Line Items]
Long lived assets	2,101,000				2,456,000				2,101,000	2,456,000
UNITED KINGDOM | Property, Plant and Equipment [Member]
Segment Reporting Information [Line Items]
Long lived assets	197,000				192,000				197,000	192,000
CHINA | Property, Plant and Equipment [Member]
Segment Reporting Information [Line Items]
Long lived assets	251,000				338,000				251,000	338,000
JAPAN | Property, Plant and Equipment [Member]
Segment Reporting Information [Line Items]
Long lived assets	50,000				206,000				50,000	206,000
KOREA, REPUBLIC OF | Property, Plant and Equipment [Member]
Segment Reporting Information [Line Items]
Long lived assets	$ 0				$ 1,885,000				$ 0	$ 1,885,000

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Restatement of Previously Issued Financial Statements Restatement of Statement of Cash Flows (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Net loss	$ (34,482,492)	$ (25,380,115)	$ (23,031,145)
Foreign currency (gains) losses	(1,096,487)	893,260	$ 711,356
Distribution to Minority Interest Holder	(699,105)	$ (791,737)
Previously Reported [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Net loss	(35,818,575)
Foreign currency (gains) losses	177,469
Distribution to Minority Interest Holder	(636,978)
Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Net loss	1,336,083
Foreign currency (gains) losses	(1,273,956)
Distribution to Minority Interest Holder	(62,127)
As Revised [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Net loss	(34,482,492)
Foreign currency (gains) losses	(1,096,487)
Distribution to Minority Interest Holder	$ (699,105)

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Summary of Significant Accounting Policies (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 29, 2018	Sep. 29, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016	Dec. 31, 2017
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Net loss									$ (34,482,492)	$ (25,380,115)	$ (23,031,145)
Net Cash Provided by (Used in) Operating Activities									(28,103,782)	(25,912,698)	(26,174,695)
Revenue, Remaining Performance Obligation, Amount	$ 8,000,000.0								8,000,000.0
Revenues	(7,741,000)	$ (5,126,000)	$ (5,944,000)	$ (5,654,000)	$ (11,397,000)	$ (6,139,000)	$ (5,927,000)	$ (4,378,000)	(24,465,005)	(27,841,490)	(22,642,566)
Contract with Customer, Asset, Net	3,089,663				704,863				$ 3,089,663	704,863		$ 3,555,137
Product Warranty Term									12 months
Inventory, Net, Items Net of Reserve Alternative [Abstract]
Raw materials	2,548,139				2,070,153				$ 2,548,139	2,070,153
Work-in-process	1,526,552				1,829,805				1,526,552	1,829,805
Finished goods	722,547				1,180,839				722,547	1,180,839
Inventory	(4,797,238)				(5,080,797)				(4,797,238)	(5,080,797)		(3,998,168)
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward]
Asset retirement obligation, beginning balance				269,877				246,922	269,877	246,922
Additional liabilities incurred									(15,779)	22,955
Asset retirement obligation, ending balance	254,098				269,877				254,098	269,877	246,922
Impairment of Long-term Assets [Abstract]
Other assets	1,649,401				3,842,068				1,649,401	3,842,068		4,242,068
Total contract liabilities and billings in excess of revenue earned					1,555,883					1,555,883
Contract with Customer, Liability												(664,146)
Accumulated deficit	(271,730,661)				(240,256,502)				(271,730,661)	(240,256,502)		(237,197,119)
Research and development and other revenues									5,253,890	2,946,685	1,527,441
Cost of product revenues									15,831,441	18,118,418	17,814,271
Net Income (Loss) Attributable to Parent	$ (9,966,000)	$ (9,791,000)	$ (9,241,000)	$ (5,536,000)	$ (1,803,000)	$ (8,247,000)	$ (7,332,000)	$ (7,858,000)	$ (34,533,542)	$ (25,240,482)	$ (23,568,717)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	12 months								12 months
Minimum
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Operating Lease, Right-of-Use Asset	$ 3,500,000								$ 3,500,000
Property, Plant and Equipment [Abstract]
Useful life of property, plant and equipment									3 years
Impairment of Long-term Assets [Abstract]
Operating Lease, Liability	3,500,000								$ 3,500,000
Maximum
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Operating Lease, Right-of-Use Asset	4,000,000.0								$ 4,000,000.0
Property, Plant and Equipment [Abstract]
Useful life of property, plant and equipment									10 years
Impairment of Long-term Assets [Abstract]
Operating Lease, Liability	$ 4,000,000.0								$ 4,000,000.0
Restricted stock
Stock-based Compensation [Abstract]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period									1,549,000	1,152,000	1,663,000
eMDT
Principles of Consolidations [Abstract]
Kopin's ownership percentage	80.00%								80.00%
Share-based Compensation Award, Tranche One [Member]
Stock-based Compensation [Abstract]
Nonvested common stock awards employment obligations									1 year
Share-based Compensation Award, Tranche One [Member] | Restricted stock
Stock-based Compensation [Abstract]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period									640,000
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period									20 days
Share-based Compensation Award, Tranche Two [Member]
Stock-based Compensation [Abstract]
Nonvested common stock awards employment obligations									2 years
Share-based Compensation Award, Tranche Two [Member] | Restricted stock
Stock-based Compensation [Abstract]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period									150,000
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period									20 days
Share-based Compensation Award, Tranche Three [Member]
Stock-based Compensation [Abstract]
Nonvested common stock awards employment obligations									4 years
Share-based Compensation Award, Tranche Three [Member] | Restricted stock
Stock-based Compensation [Abstract]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period									150,000
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period									20 days
Unvested Restricted Stock Awards
Weighted Average Number of Shares Outstanding Reconciliation [Abstract]
Antidilutive securities excluded from computation of earnings per share									2,213,249	2,629,274	3,007,674
Product [Member]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Revenues									$ (19,211,115)	$ (24,894,805)	$ (21,115,125)
Impairment of Long-term Assets [Abstract]
Cost of product revenues									15,831,441
Net Income (Loss) Attributable to Parent									(34,533,542)
Extended Warranties [Member]
Impairment of Long-term Assets [Abstract]
Contract with Customer, Liability	$ (400,000)								$ (400,000)
Transferred over Time [Member]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Revenue, Percentage from Products and Services Transferred to Customers									40.00%	9.00%	5.00%
Transferred at Point in Time [Member]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Revenue, Percentage from Products and Services Transferred to Customers									60.00%	91.00%	95.00%
Accounting Standards Update 2014-09 [Member]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Contract with Customer, Asset, Net												2,850,274
Inventory, Net, Items Net of Reserve Alternative [Abstract]
Inventory												(1,082,629)
Impairment of Long-term Assets [Abstract]
Other assets												400,000
Contract with Customer, Liability												(891,737)
Accumulated deficit												$ 3,059,383
Difference between Revenue Guidance in Effect before and after Topic 606 [Member]
Impairment of Long-term Assets [Abstract]
Cost of product revenues									$ 346,176
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Product [Member]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Revenues									(515,786)
Impairment of Long-term Assets [Abstract]
Cost of product revenues									977,902
Net Income (Loss) Attributable to Parent									115,940
Calculated under Revenue Guidance in Effect before Topic 606 [Member]
Impairment of Long-term Assets [Abstract]
Cost of product revenues									5,600,066
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Product [Member]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items]
Revenues									(19,726,901)
Impairment of Long-term Assets [Abstract]
Cost of product revenues									16,809,343
Net Income (Loss) Attributable to Parent									$ (34,649,482)

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Business Combinations (Details) - USD ($)		12 Months Ended
	Mar. 07, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Business Acquisition [Line Items]
Business Acquisition, Pro Forma Revenue			$ 28,477,870	$ 25,029,681
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents	$ 2,600
Business Combination, Consideration Transferred	3,693,000	$ 1,000,000	3,690,047
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract]
Goodwill		331,344	1,780,247	844,023
Business Combination, Contingent Consideration, Liability		$ 2,000,000.0
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables	490,700
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory	768,400
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Prepaid Expense and Other Assets	46,800
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities	(480,500)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities	(1,084,000)
Business Acquisition, Goodwill, Expected Tax Deductible Amount	1,489,000
Business Acquisition, Transaction Costs	$ 200,000
Business Acquisition, Pro Forma Net Income (Loss)			$ (26,302,840)	$ (23,736,518)
Business Acquisition, Pro Forma Earnings Per Share, Diluted			$ (0.38)	$ (0.37)
eMDT
Business Acquisition [Line Items]
Kopin's ownership percentage		80.00%
Order or Production Backlog [Member]
Business Acquisition [Line Items]
Finite-Lived Intangible Asset, Useful Life	1 year
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	$ 840,000
Customer Relationships [Member]
Business Acquisition [Line Items]
Finite-Lived Intangible Asset, Useful Life	2 years
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	$ 1,000,000
Technology-Based Intangible Assets [Member]
Business Acquisition [Line Items]
Finite-Lived Intangible Asset, Useful Life	2 years
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	$ 460,000
Trademarks [Member]
Business Acquisition [Line Items]
Finite-Lived Intangible Asset, Useful Life	2 years
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	$ 160,000

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Income Taxes (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Income Taxes [Line Items]
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	21.00%
Tax Cuts and Jobs Act of 2017, Remeasurement of Deferred for Reduction in Corporate Tax Rate, Income Tax Expense (Benefit)	$ 25,100,000
Unrecognized Tax Benefits	394,000	$ 394,000	$ 374,000
Unrecognized Tax Benefits, Period Increase (Decrease)	0	20,000
Income (Loss) from Continuing Operations before Income Taxes, Foreign	700,000	(400,000)	5,400,000
Deferred Tax Assets, Valuation Allowance	58,006,000	50,642,000
Current:
State	5,000	5,000	33,000
Current Foreign Tax Expense (Benefit)	25,000	(568,000)	1,656,000
Total current provision	30,000	(563,000)	1,689,000
Deferred:
Federal	(7,307,000)	15,461,000	(8,718,000)
State	(360,000)	(493,000)	(1,264,000)
Foreign	300,000	(187,000)	2,308,000
Change in valuation allowance	7,367,000	(17,181,000)	9,115,000
Total deferred provision	0	(2,400,000)	1,441,000
Income Tax Expense (Benefit)	30,000	(2,963,000)	3,130,000
Income Tax Expense (Benefit), Continuing Operations, Income Tax Reconciliation [Abstract]
Tax provision at federal statutory rates	(7,515,000)	(9,884,000)	(6,965,000)
State tax liability	5,000	5,000	22,000
Foreign deferred tax rate differential	(39,000)	15,000	(678,000)
Foreign withholding	(301,000)	(771,000)	(1,441,000)
Outside basis in Kowon, net unremitted earnings	(468,000)	(2,888,000)	958,000
Non-deductible expenses	186,000	774,000	259,000
Increase in net state operating loss carryforwards	(406,000)	(300,000)	(502,000)
Other Income Tax Expense (Benefit), Continuing Operations	0	0	(142,000)
Provision to tax return adjustments and tax rate change (1)	(76,000)	24,833,000	(66,000)
Tax credits	239,000	24,000	762,000
Effective Income Tax Rate Reconciliation, Deduction, Amount	13,000	199,000	0
Non-deductible equity compensation	290,000	1,901,000	(360,000)
Effective Income Tax Rate Reconciliation, Tax Contingency, Amount	91,000	203,000	671,000
Other, net	45,000	107,000	139,000
Change in valuation allowance	7,364,000	(17,181,000)	9,115,000
Income Tax Expense (Benefit)	30,000	(2,963,000)	3,130,000
Deferred tax liability:
Foreign withholding liability	(538,000)	(812,000)
Foreign unremitted earnings	0	(468,000)
Deferred Tax Assets, Goodwill and Intangible Assets	0	(259,000)
Deferred Tax assets:
Federal net operating loss carryforwards	41,755,000	34,555,000
State net operating loss carryforwards	3,114,000	2,708,000
Foreign net operating loss carryforwards	1,259,000	1,500,000
Equity awards	444,000	55,000
Tax credits	7,231,000	7,470,000
Equipment	640,000	544,000
Investments	1,848,000	1,792,000
Deferred Tax Assets, Other Tax Carryforwards	1,707,000	3,037,000
Net deferred tax assets	57,460,000	50,122,000
Deferred Tax Assets, Net, Noncurrent	(546,000)	(520,000)
Income Tax Expense (Benefit)	30,000	(2,963,000)	$ 3,130,000
Unrecognized Tax Benefits, Interest on Income Taxes Expense	500,000	$ 500,000
Deferred Tax Assets, Tax Credit Carryforwards, Alternative Minimum Tax	$ 1,000,000.0
Estimated Applicable Foreign Tax Rate	15.50%
Maximum
Deferred Tax assets:
The state impact of any federal changes, subject to examination by various states (in years)	1 year
International jurisdictions | Minimum
Deferred Tax assets:
Income tax returns examination period	3 years
International jurisdictions | Maximum
Deferred Tax assets:
Income tax returns examination period	20 years
Federal
Deferred Tax assets:
Net operating loss carryforwards available for tax purposes	$ 198,800,000
State | Minimum
Deferred Tax assets:
Income tax returns examination period	3 years
State | Maximum
Deferred Tax assets:
Income tax returns examination period	5 years

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Stockholders' Equity and Stock-Based Compensation (Details) - USD ($)		12 Months Ended
	Apr. 22, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016	Dec. 26, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock Issued During Period, Value, Treasury Stock Reissued			$ 24,664,250
Excess Stock, Shares Authorized		14,100,000
Stock-based compensation		$ 4,791,054	$ 2,296,131	$ 2,425,326
Restricted stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value		$ 2.51	$ 3.31	$ 3.21	$ 3.82
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized		$ 3,400,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition		2 years
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period		1,549,000	1,152,000	1,663,000
2010 Equity Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares that may be issued		1,700,000
Share-based Compensation Award, Tranche One [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period		1 year
Share-based Compensation Award, Tranche One [Member] | Restricted stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Market Price, Award Vest		$ 5.25
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate		48.30%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate		1.97%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term		2 years
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period		640,000
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		20 days
Share-based Compensation Award, Tranche Two [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period		2 years
Share-based Compensation Award, Tranche Two [Member] | Restricted stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Market Price, Award Vest		$ 6.00
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate		48.30%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate		1.97%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term		2 years
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate		0.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period		150,000
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		20 days
Share-based Compensation Award, Tranche Three [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period		4 years
Share-based Compensation Award, Tranche Three [Member] | Restricted stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Market Price, Award Vest		$ 7.00
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate		48.30%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate		1.97%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term		2 years
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate		0.00%
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period		150,000
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		20 days
Period One [Member] | Unvested Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period		1 year
Period Two [Member] | Unvested Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period		2 years
Period Three [Member] | Unvested Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period		4 years
Goertek [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Sale of Stock, Number of Shares Issued in Transaction	7,589,000
Stock Issued During Period, Value, Treasury Stock Reissued	$ 24,664,250
Sale of Stock, Price Per Share	$ 3.25
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners	10.10%
Gain (Loss) on Sale of Treasury Stock	$ 800,000

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Stockholders' Equity and Stock-Based Compensation (Tables)

12 Months Ended

Dec. 29, 2018

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

NonVested Restricted Common Stock

	Shares		Weighted Average Grant Fair Value
Outstanding at December 26, 2015	2,192,016		$	3.82
Granted	1,663,000		2.40
Forfeited	(110,500	)	3.21
Vested	(736,842	)	3.17
Outstanding at December 31, 2016	3,007,674		3.21
Granted	1,152,000		3.40
Forfeited	(465,150	)	3.82
Vested	(1,065,250	)	2.90
Balance at December 30, 2017	2,629,274		3.31
Granted	1,549,000		2.25
Forfeited	(872,025	)	3.78
Vested	(1,093,000	)	3.05
Balance at December 29, 2018	2,213,249		$	2.51

Stock-Based Compensation Expense

for the fiscal years 2018, 2017 and 2016 (no tax benefits were recognized):

	2018		2017		2016
Cost of product revenues	$	418,605	$	490,481	$	561,791
Research and development	725,112		799,485		527,081
Selling, general and administrative	3,647,337		1,006,165		1,336,454
Total	$	4,791,054	$	2,296,131	$	2,425,326

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Commintments and Contingencies (Tables)

12 Months Ended

Dec. 29, 2018

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases

The following is a schedule of minimum rental commitments under non-cancelable operating leases at December 29, 2018:

Fiscal year ending,	Amount
2019	$	1,210,000
2020	1,112,000
2021	921,000
2022	616,000
2023	201,000
Thereafter	—
Total minimum lease payments	$	4,060,000

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Dec. 29, 2018	Dec. 30, 2017
Accounts receivable, allowance	$ 304,000	$ 149,000
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, authorized	3,000	3,000
Preferred stock, issued	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, authorized	120,000,000	120,000,000
Common stock, issued	80,735,320	80,201,313
Common stock, outstanding	74,008,811	73,058,783
Treasury stock, shares	4,513,256	4,513,256

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Stockholders' Equity and Stock-Based Compensation

12 Months Ended

Dec. 29, 2018

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

Stockholders' Equity and Stock-Based Compensation

Stockholders’ Equity and Stock-Based Compensation

Sale of Unregistered Common Stock

On April 20, 2017, the Company sold 7,589,000 shares of unregistered common stock to Goertek, Inc. for $24,664,250 ($3.25 per share). This represented approximately 10.1% of Kopin’s total outstanding shares of common stock as of the date of purchase. In addition, Kopin and Goertek have entered into agreements to jointly develop and commercialize a range of technologies and wearable products. Goertek is a leading innovative global technology company headquartered in Weifang, China that designs and manufactures a range of consumer electronics products for brand customers including wearables, virtual and augmented reality headsets, and audio products. The transaction was accounted for under ASC 505-30 "Treasury Stock", and the loss on the sale of the treasury stock of approximately $0.8 million was charged to retained earnings. At completion of the transaction, the U.S. government requested certain information regarding the transaction for the Committee on Foreign Investment. See Note 16. Related Party Transactions for additional discussion around agreements with Goertek.

Restricted Stock Awards

In 2010, the Company adopted a 2010 Equity Incentive Plan ("2010 Equity Plan") which authorized the issuance of shares of common stock to employees, non-employees, and the Board. The 2010 Equity Plan was a successor to the Company’s 2001 Equity Incentive Plan ("2001 Equity Plan") and has been subsequently amended to increase the number of authorized shares to 14,100,000 as of December 29, 2018. The number of shares authorized under the 2010 Equity Plan is the number of shares approved by the shareholders plus the number of shares of common stock which were available for grant under the 2001 Equity Plan, the number of shares of common stock which were the subject of awards outstanding under the 2001 Equity Plan and are forfeited, terminated, canceled or expire after the adoption of the 2010 Equity Plan and the number of shares of common stock delivered to the Company either in exercise of an 2001 Equity Plan award or in satisfaction of a tax withholding obligation. The term and vesting period for restricted stock awards granted under the 2010 Equity Plan are determined by the Board’s compensation committee. As of December 29, 2018, the Company has approximately 1.7 million shares of common stock authorized and available for issuance under the Company’s 2010 Equity Plan.

The fair value of non-vested restricted common stock awards is generally the market value of the Company’s common stock on the date of grant. The non-vested restricted common stock awards require the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also require meeting either performance criteria or the Company’s stock achieving a certain price. For non-vested restricted common stock awards that solely require the recipient to remain employed with the Company, the stock compensation expense is amortized over the anticipated service period. For non-vested restricted common stock awards that require the achievement of performance criteria, the Company reviews the probability of achieving the performance goals on a periodic basis. If the Company determines that it is probable that the performance criteria will be achieved, the amount of compensation cost derived for the performance goal is amortized over the anticipated service period. If the performance criteria are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed.

	Shares		Weighted Average Grant Fair Value
Outstanding at December 26, 2015	2,192,016		$	3.82
Granted	1,663,000		2.40
Forfeited	(110,500	)	3.21
Vested	(736,842	)	3.17
Outstanding at December 31, 2016	3,007,674		3.21
Granted	1,152,000		3.40
Forfeited	(465,150	)	3.82
Vested	(1,065,250	)	2.90
Balance at December 30, 2017	2,629,274		3.31
Granted	1,549,000		2.25
Forfeited	(872,025	)	3.78
Vested	(1,093,000	)	3.05
Balance at December 29, 2018	2,213,249		$	2.51

On December 31, 2017 (fiscal year beginning 2018), the Company amended the employment agreement with our CEO Dr. John Fan to expire on December 31, 2020 and as part of the amendment issued restricted stock grants. 640,000 shares of restricted stock which will vest upon the first 20 consecutive trading day period following the grant date during which the Company's common stock trades at a price equal to or greater than $5.25, 150,000 shares of restricted stock will vest at the end of the first 20 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $6.00, and 150,000 shares of restricted common stock will vest at the end of the first 20 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $7.00. All of the grants are subject to certain acceleration events and terminate on December 31, 2020.

	For the period ended December 29, 2018
Performance price target	$	5.25		$	6.00		$	7.00
Expected volatility	48.3		%	48.3		%	48.3		%
Interest rate	1.97		%	1.97		%	1.97		%
Expected life (years)	2			2			2
Dividend yield	—		%	—		%	—		%

Stock-Based Compensation

The following table summarizes stock-based compensation expense within each of the categories below as it relates to non-vested restricted common stock awards for the fiscal years 2018, 2017 and 2016 (no tax benefits were recognized):

	2018		2017		2016
Cost of product revenues	$	418,605	$	490,481	$	561,791
Research and development	725,112		799,485		527,081
Selling, general and administrative	3,647,337		1,006,165		1,336,454
Total	$	4,791,054	$	2,296,131	$	2,425,326

Unrecognized compensation expense for non-vested restricted common stock as of December 29, 2018 totaled $3.4 million and is expected to be recognized over a weighted average period of approximately two years.

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Cash flows from operating activities:
Net loss	$ (34,482,492)	$ (25,380,115)	$ (23,031,145)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	1,958,680	2,501,891	993,621
Accretion of premium or discount on marketable debt securities	15,948	41,364	130,032
Stock-based compensation	4,791,054	2,296,131	2,425,326
Net gain on investment transactions	(2,849,816)	(2,000,000)	(1,034,396)
Deferred income taxes	4,185	(2,421,040)	1,451,858
Foreign currency (gains) losses	(1,096,487)	893,260	711,356
Loss (gain) on sale of property and plant	51,159		(7,700,522)
Impairment of assets	2,526,669
Impairment of goodwill	1,417,470	600,086
Change in allowance for bad debt	(155,000)	13,000	(17,000)
Other non-cash items	832,615	654,694	677,330
Change in warranty reserves	(79,633)	142,328	0
Changes in assets and liabilities:
Accounts receivable	853,163	(2,376,593)	(39,629)
Contract assets and unbilled receivables	865,474
Inventory	(1,656,196)	(1,633,027)	(1,527,602)
Prepaid expenses, other current assets and other assets	113,015	(1,084,146)	48,295
Accounts payable and accrued expenses	(1,208,848)	1,924,751	1,163,586
Billings in excess of revenue earned	(4,742)	(85,282)	(425,805)
Net cash used in operating activities	(28,103,782)	(25,912,698)	(26,174,695)
Cash flows from investing activities:
Proceeds from sale of marketable debt securities	26,646,078	37,536,004	50,835,253
Purchase of marketable debt securities	(5,697,329)	(19,633,903)	(51,828,988)
Proceeds from sale of investments	0	0	1,034,396
Cash paid for acquisition, net of cash acquired	(1,000,000)	(3,690,047)
Proceeds from sale of III-V product line	0	0	15,000,000
Proceeds from sale of property and plant	0	0	8,106,819
Other assets	(8,373)	(140,860)	80,793
Capital expenditures	(1,183,131)	(2,794,467)	(394,897)
Net cash provided by investing activities	18,757,245	11,276,727	22,833,376
Cash flows from financing activities:
Sale of unregistered stock		24,664,250
Settlements of restricted stock for tax withholding obligations	(208,015)	(771,323)	(510,597)
Distribution to noncontrolling interest holder	(699,105)	(791,737)
Net cash (used in) provided by financing activities	(907,120)	23,101,190	(510,597)
Effect of exchange rate changes on cash	(268,223)	560,513	(93,478)
Net (decrease) increase in cash and cash equivalents	(10,521,880)	9,025,732	(3,945,394)
Cash and cash equivalents at beginning of year	24,848,227	15,822,495	19,767,889
Cash and cash equivalents at end of year	14,326,347	24,848,227	15,822,495
Supplemental disclosure of cash flow information:
Income taxes paid	1,374,000	281,000	723,000
Construction in progress included in accrued expenses	$ 0	$ 212,000	$ 0

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Contract Assets and Liabilities (Notes)

12 Months Ended

Dec. 29, 2018

Contract Assets and Liabilities [Abstract]

Contract Assets (Liabilities), Net [Text Block]

3.    Contract Assets and Liabilities

Net contract assets (liabilities) consisted of the following:

	December 29, 2018			December 31, 2017			$ Change			% Change
Contract assets and unbilled receivables	$	3,089,663		$	3,555,137		$	(465,474	)	(13	)%
Contract liabilities and billings in excess of revenue earned	(388,933		)	(664,146		)	275,213			(41	)%
Contract liabilities, noncurrent	(17,294		)	(374,171		)	356,877			(95	)%
Net contract assets	$	2,683,436		$	2,516,820		$	166,616		7	%

The $0.2 million increase in the Company's net contract assets from December 31, 2017 to December 29, 2018 was primarily due to our fixed-price contracts with the U.S. government that resulted in revenue recognized in excess of amounts billed and the adoption of Topic 606.

The Company recognized revenue of approximately $0.3 million and $0.4 million related to our contract liabilities at December 31, 2017 and January 1, 2017, respectively.

The Company did not recognize impairment losses on our contract assets during the years ended December 29, 2018 and December 30, 2017.

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Employee Benefit Plan

12 Months Ended

Dec. 29, 2018

Retirement Benefits [Abstract]

Employee Benefit Plan

Employee Benefit Plan

The Company has an employee benefit plan pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended. In 2018, the plan allowed employees to defer an amount of their annual compensation up to a current maximum of $18,500 if they are under the age of 50 and $24,500 if they are over the age of 50. The Company matches 50% of all deferred compensation on the first 6% of each employee’s deferred compensation. The amount charged to operations in connection with this plan was approximately $0.3 million in fiscal years 2018, 2017 and 2016.

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Accrued Warranty (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Product Warranties Disclosures [Abstract]
Product Warranty Term	12 months
Movement in Standard Product Warranty Accrual [Roll Forward]
Beginning balance	$ 649,000	$ 518,000	$ 518,000
Additions	159,000	328,000	440,000
Claims and reversals	(237,000)	(197,000)	(440,000)
Ending Balance	$ 571,000	$ 649,000	$ 518,000

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Stockholders' Equity and Stock-Based Compensation (Nonvested Restricted Common Stock) (Details) - Restricted stock - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Shares
Beginning Balance	2,629,274	3,007,674	2,192,016
Granted	1,549,000	1,152,000	1,663,000
Forfeited	(872,025)	(465,150)	(110,500)
Vested	(1,093,000)	(1,065,250)	(736,842)
Ending Balance	2,213,249	2,629,274	3,007,674
Weighted Average Grant Fair Value
Beginning Balance	$ 3.31	$ 3.21	$ 3.82
Granted	2.25	3.40	2.40
Forfeited	3.78	3.82	3.21
Vested	3.05	2.90	3.17
Ending Balance	$ 2.51	$ 3.31	$ 3.21
Share-based Compensation Award, Tranche One [Member]
Shares
Granted	640,000
Weighted Average Grant Fair Value
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate	48.30%
Share-based Compensation Arrangement by Share-based Payment Award, Market Price, Award Vest	$ 5.25
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate	1.97%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term	2 years
Share-based Compensation Award, Tranche Two [Member]
Shares
Granted	150,000
Weighted Average Grant Fair Value
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate	48.30%
Share-based Compensation Arrangement by Share-based Payment Award, Market Price, Award Vest	$ 6.00
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate	1.97%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term	2 years
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate	0.00%
Share-based Compensation Award, Tranche Three [Member]
Shares
Granted	150,000
Weighted Average Grant Fair Value
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate	48.30%
Share-based Compensation Arrangement by Share-based Payment Award, Market Price, Award Vest	$ 7.00
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate	1.97%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term	2 years
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate	0.00%

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Financial Instruments (Tables)

12 Months Ended

Dec. 29, 2018

Financial Instruments [Abstract]

Fair Value, by Balance Sheet Grouping

			Fair Value Measurement at December 29, 2018 Using:
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	14,326,347	$	14,326,347	$	—	$	—
U.S. government and agency backed securities	12,810,923		—		12,810,923		—
Corporate debt	10,107,093		—		10,107,093		—
GCS Holdings	288,026		288,026		—		—
Equity Investments	5,565,499		—		—		5,565,499
	$	43,097,888	$	14,614,373	$	22,918,016	$	5,565,499

			Fair Value Measurement at December 30, 2017 Using:
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	24,848,227	$	24,848,227	$	—	$	—
U.S. government and agency backed securities	34,725,811		6,927,323		27,798,488		—
Corporate debt	8,980,906		—		8,980,906		—
Certificates of deposit	200,740		—		200,740		—
GCS Holdings	478,546		478,546		—		—
Warrant	2,000,000		—		—		2,000,000
	$	71,234,230	$	32,254,096	$	36,980,134	$	2,000,000

Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

Changes in Level 3 investments are as follows:

	December 30, 2017		Net unrealized gains/(losses)			Purchases, issuances and settlements			Transfers in and or out of Level 3		December 29, 2018
Equity Investments	$	—	$	(284,317	)	$	5,849,816		$	—	$	5,565,499
Warrant	2,000,000		(50,184		)	(1,949,816		)	—		—
	$	2,000,000	$	(334,501	)	$	3,900,000		$	—	$	5,565,499

Available-for-sale Securities

Investments in available-for-sale marketable debt securities are as follows at December 29, 2018 and December 30, 2017: 

	Amortized Cost				Unrealized Losses						Fair Value
	2018		2017		2018			2017			2018		2017
U.S. government and agency backed securities	$	13,064,418	$	35,014,593	$	(253,495	)	$	(288,782	)	$	12,810,923	$	34,725,811
Corporate debt	10,175,084		8,988,608		(67,991		)	(7,702		)	10,107,093		8,980,906
Certificates of deposits	—		201,000		—			(260		)	—		200,740
Total	$	23,239,502	$	44,204,201	$	(321,486	)	$	(296,744	)	$	22,918,016	$	43,907,457

Investments Classified by Contractual Maturity Date

The contractual maturity of the Company’s marketable debt securities is as follows at December 29, 2018:

	Less than One year		One to Five years		Total
U.S. government and agency backed securities	$	3,741,183	$	9,069,740	$	12,810,923
Corporate debt	2,709,074		7,398,019		10,107,093
Total	$	6,450,257	$	16,467,759	$	22,918,016

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Accrued Warranty (Tables)

12 Months Ended

Dec. 29, 2018

Product Warranties Disclosures [Abstract]

Accrued Warranty

Changes in the accrued warranty for fiscal years ended 2018, 2017 and 2016 are as follows:

	Fiscal Year Ended
	December 29, 2018			December 30, 2017			December 31, 2016
Beginning balance	$	649,000		$	518,000		$	518,000
Additions	159,000			328,000			440,000
Claim and reversals	(237,000		)	(197,000		)	(440,000		)
Ending Balance	$	571,000		$	649,000		$	518,000

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Commintments and Contingencies

12 Months Ended

Dec. 29, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Leases

The Company leases various facilities. The following is a schedule of minimum rental commitments under non-cancelable operating leases at December 29, 2018:

Fiscal year ending,	Amount
2019	$	1,210,000
2020	1,112,000
2021	921,000
2022	616,000
2023	201,000
Thereafter	—
Total minimum lease payments	$	4,060,000

Amounts incurred under operating leases are recorded as rent expense on a straight-line basis. Total rent expense in the fiscal years ended 2018, 2017 and 2016 were approximately $1.4 million, $1.5 million and $1.3 million, respectively.

The Company has entered into an agreement to make a capital contribution of approximately $5.1 million (the Company's capital contribution under the agreement is $35.0 million Chinese Yuan Renminbi). The Company’s ability to make its capital contribution is subject to Chinese laws which include restrictions of direct foreign investment. Accordingly, the Company will need to make the capital contribution through its Chinese subsidiary’s operations.

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CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 29, 2018	Dec. 30, 2017
Current assets:
Cash and cash equivalents	$ 14,326,347	$ 24,848,227
Marketable debt securities, at fair value	22,918,016	43,907,457
Accounts receivable, net of allowance of $304,000 and $149,000 in 2018 and 2017, respectively	3,088,360	3,955,123
Contract assets and unbilled receivables	3,089,663	704,863
Inventory	4,797,238	5,080,797
Prepaid taxes	399,611	264,352
Prepaid expenses and other current assets	784,790	978,677
Total current assets	49,404,025	79,739,496
Property, plant and equipment, net	2,598,842	5,077,043
Goodwill	331,344	1,780,247
Intangibles	0	883,636
Other assets	1,649,401	3,842,068
Equity investments	5,565,499	0
Total assets	59,549,111	91,322,490
Current liabilities:
Accounts payable	3,921,880	4,918,605
Accrued payroll and expenses	3,038,005	1,636,512
Accrued warranty	571,000	649,000
Contract liabilities and billings in excess of revenue earned	388,933	896,479
Other accrued liabilities	1,901,547	2,066,025
Income tax payable	0	1,416,892
Deferred tax liabilities	546,000	520,000
Total current liabilities	10,367,365	12,103,513
Contract liabilities, noncurrent	17,294	374,171
Asset retirement obligations	254,098	269,877
Other long-term liabilities	1,197,533	1,195,082
Commitments and contingencies (Note 12)
Stockholders’ equity:
Preferred stock, par value $.01 per share: authorized, 3,000 shares; none issued	0	0
Common stock, par value $.01 per share: authorized, 120,000,000 shares; issued 80,735,320 shares in 2018 and 80,201,313 shares in 2017; outstanding 74,008,815 in 2018 and 73,058,783 in 2017, respectively	785,220	775,720
Additional paid-in capital	334,491,397	329,917,858
Treasury stock (4,513,256 shares in 2018 and 2017, at cost)	(17,238,669)	(17,238,669)
Accumulated other comprehensive income	1,554,587	3,564,779
Accumulated deficit	(271,730,661)	(240,256,502)
Total Kopin Corporation stockholders’ equity	47,861,874	76,763,186
Noncontrolling interest	(149,053)	616,661
Total stockholders’ equity	47,712,821	77,379,847
Total liabilities and stockholders’ equity	$ 59,549,111	$ 91,322,490

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Concentrations of Risk

12 Months Ended

Dec. 29, 2018

Risks and Uncertainties [Abstract]

Concentrations of Risk

Concentrations of Risk

Ongoing credit evaluations of customers’ financial condition are performed and collateral, such as letters of credit, are generally not required. Customer’s accounts receivable balance as a percentage of total accounts receivable was as follows:

	Percent of Gross Accounts Receivable
Customer	December 29, 2018	December 30, 2017
Collins Aerospace	11%	*
DRS Technologies	11%	*
Scott Safety	*	14%
RealWear, Inc.	31%	10%
U.S. Army	*	43%

Note: The symbol “*” indicates that accounts receivables from that customer were less than 10% of the Company’s total accounts receivable.

Sales to significant non-affiliated customers for fiscal years 2018, 2017 and 2016, as a percentage of total revenues, is as follows:

	Sales as a Percent of Total Revenue
	Fiscal Year
Customer	2018	2017	2016
Military Customers in Total	36%	48%	24%
General Dynamics	11%	*	*
DRS Technologies	*	10%	*
Collins Aerospace	20%	10%	12%
Shenzhen Oriscape	*	*	20%
U.S. Army	*	12%	*
Funded Research and Development Contracts	20%	11%	7%

Note: The symbol “*” indicates that sales to that customer were less than 10% of the Company’s total revenues. The caption "Military Customers in Total" excludes research and development contracts.

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)	Total	Common Stock	Additional Paid-in Capital	Treasury Stock	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Total Kopin Corporation Stockholders' Equity	Noncontrolling Interest
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures		736,842
Beginning Balance (in shares) at Dec. 26, 2015		76,079,643
Beginning Balance at Dec. 26, 2015	$ 94,484,780	$ 760,797	$ 325,357,045	$ (42,741,551)	$ 771,774	$ (190,608,671)	$ 93,539,394	$ 945,386
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Vesting of restricted stock		$ 7,368	(7,368)
Stock-based compensation expense	2,482,326		2,482,326				2,482,326
Other comprehensive income (loss)	794,279				799,197		799,197	(4,918)
Restricted stock for tax withholding obligations (in shares)		(175,542)
Restricted stock for tax withholding obligations	(510,597)	$ (1,756)	(508,841)				(510,597)
Net income (loss)	(23,031,145)					(23,568,717)	(23,568,717)	537,572
Ending Balance (in shares) at Dec. 31, 2016		76,640,943
Ending Balance at Dec. 31, 2016	74,219,643	$ 766,409	327,323,162	(42,741,551)	1,570,971	(214,177,388)	72,741,603	1,478,040
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures		1,170,847
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Vesting of restricted stock		$ 11,708	(11,708)
Stock-based compensation expense	3,375,330		3,375,330				3,375,330
Other comprehensive income (loss)	2,063,799				1,993,808		1,993,808	69,991
Restricted stock for tax withholding obligations (in shares)		(239,752)
Restricted stock for tax withholding obligations	(771,323)	$ (2,397)	(768,926)				(771,323)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(791,737)							(791,737)
Sale of unregistered stock	24,664,250			25,502,882		(838,632)	24,664,250
Net income (loss)	(25,380,115)					(25,240,482)	(25,240,482)	(139,633)
Ending Balance (in shares) at Dec. 30, 2017		77,572,038
Ending Balance at Dec. 30, 2017	77,379,847	$ 775,720	329,917,858	(17,238,669)	3,564,779	(240,256,502)	76,763,186	616,661
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures		1,093,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Vesting of restricted stock		$ 10,930	(10,930)
Stock-based compensation expense	4,791,054		4,791,054				4,791,054
Other comprehensive income (loss)	(2,127,851)				(2,010,192)			(117,659)
Restricted stock for tax withholding obligations (in shares)		(142,972)
Restricted stock for tax withholding obligations	(208,015)	$ (1,430)	(206,585)				(208,015)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(699,105)							(699,105)
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification	3,059,383					3,059,383	3,059,383
Net income (loss)	(34,482,492)					(34,533,542)	(34,533,542)	51,050
Ending Balance (in shares) at Dec. 29, 2018		78,522,066
Ending Balance at Dec. 29, 2018	$ 47,712,821	$ 785,220	$ 334,491,397	$ (17,238,669)	$ 1,554,587	$ (271,730,661)	$ 47,861,874	$ (149,053)

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Business Combinations

12 Months Ended

Dec. 29, 2018

Business Combinations [Abstract]

Business Combinations

Business Combinations

In March 2017, we purchased 100% of the outstanding stock of NVIS, Inc. ("NVIS") for $3.7 million. NVIS produces virtual reality systems for 3D applications. Additional payments by the Company of up to $2.0 million may be required if certain future operating performance milestones are met and the selling shareholders remain employed with NVIS through March 2020. As there is a requirement to remain employed to earn the contingent payments, these contingent payments will be treated as compensation expense.

The identifiable assets acquired and liabilities assumed at the acquisition date have been recognized at fair value. The allocation of the purchase price as of the acquisition date is as follows:

Cash and marketable securities	$	2,600
Accounts receivable	490,700
Inventory	768,400
Other identifiable assets	46,800
Order backlog	840,000
Customer relationships	1,000,000
Developed technology	460,000
Trademark portfolio	160,000
Current liabilities	(480,500		)
Net deferred tax liabilities	(1,084,000		)
Goodwill	1,489,000
Total	$	3,693,000

Goodwill represents the recording of the excess of the purchase price over the fair values of the net tangible assets acquired. No significant adjustments were recorded to the purchase price allocation during the measurement period. During the fourth quarter of 2017, we finalized the fair values of the acquired assets and liabilities.

The identified intangible assets are being amortized on a straight-line basis over the following lives, in years:

Order backlog	1
Customer relationships	2
Developed technology	2
Trademark portfolio	2

In conjunction with the acquisition, the Company recorded deferred tax liabilities of approximately $1.1 million associated with the future non-deductible amortization of the intangible assets. These deferred tax liabilities can be used to offset the Company’s net deferred tax assets. The Company reduced the valuation allowance on its net deferred tax assets in the amount of $1.1 million and such reduction was recognized as a benefit for income taxes for 2017. Acquisition expenses were approximately $0.2 million for the fiscal year ended 2017 and were recorded in selling, general and administration expenses.

The following unaudited supplemental pro forma disclosures are provided for the fiscal year ended December 30, 2017. All intercompany transactions have been eliminated.

Fiscal year ended	2017			2016
Revenues	$	28,477,870		$	25,029,681
Net loss	(26,302,840		)	(23,736,518		)
Basic and diluted earnings per share	$	(0.38	)	$	(0.37	)

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Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 29, 2018

Accounting Policies [Abstract]

Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block]

The cumulative effect of the changes made to the Company's consolidated December 31, 2017 balance sheet for the adoption of ASU 2014-09, Revenue from Contracts with Customers (Topic 606) was as follows:

Balance Sheet	Balance at December 30, 2017			Adjustments due to Topic 606			Balance at December 31, 2017
Assets
Contract assets and unbilled receivables	$	704,863		$	2,850,274		$	3,555,137
Inventory	5,080,797			(1,082,629		)	3,998,168
Other assets	3,842,068			400,000			4,242,068
Liabilities
Contract liabilities and billings in excess of revenue earned	1,555,883			(891,737		)	664,146
Stockholders’ equity
Accumulated Deficit1	$	(240,256,502	)	$	3,059,383		$	(237,197,119	)

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

In accordance with the new revenue standard requirements, the impact of adoption on the Company's consolidated statement of operations for the fiscal year 2018 was as follows:

Statement of Operations	As Reported			Balances Without Adoption of Topic 606			Effect of Change Higher/(Lower)
Net product revenues	$	19,211,115		$	19,726,901		$	(515,786	)
Research and development and other revenues	5,253,890			5,600,066			(346,176		)
Cost of product revenues	15,831,441			16,809,343			(977,902		)
Net loss attributable to Kopin Corporation	$	(34,533,542	)	$	(34,649,482	)	$	115,940

Schedule of Inventory, Current

Inventory consists of the following at December 29, 2018 and December 30, 2017:

	2018		2017
Raw materials	$	2,548,139	$	2,070,153
Work-in-process	1,526,552		1,829,805
Finished goods	722,547		1,180,839
	$	4,797,238	$	5,080,797

Schedule of Change in Asset Retirement Obligation

The Company recorded asset retirement obligations ("ARO") liabilities of $0.3 million at December 29, 2018 and December 30, 2017. This represents the legal obligations associated with retirement of the Company’s assets when the timing and/or method of settling the obligation are conditional on a future event that may or may not be within the control of the Company. Changes in ARO liabilities for fiscal years 2018 and 2017 are as follows:

	2018			2017
Beginning balance	$	269,877		$	246,922
Exchange rate change	(15,779		)	22,955
Ending balance	$	254,098		$	269,877

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

The following were not included in weighted-average common shares outstanding-diluted because they are anti-dilutive or performance conditions have not been met at the end of the period:

	2018	2017	2016
Nonvested restricted common stock	2,213,249	2,629,274	3,007,674

Schedule of Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income are as follows:

	Cumulative Translation Adjustment			Unrealized holding (loss) gain on marketable securities			Reclassifications of gain (loss) in net loss			Accumulated Other Comprehensive Income
Balance as of December 26, 2015	$	566,025		$	205,749		$	—		$	771,774
Changes during year	814,017			33,464			(48,284		)	799,197
Balance as of December 31, 2016	1,380,042			239,213			(48,284		)	1,570,971
Changes during year	1,851,664			148,520			(6,376		)	1,993,808
Balance as of December 30, 2017	3,231,706			387,733			(54,660		)	3,564,779
Changes during year	(1,794,768		)	(264,949		)	49,525			(2,010,192		)
Balance as of December 29, 2018	$	1,436,938		$	122,784		$	(5,135	)	$	1,554,587

Satisfaction of Performance Obligations [Table Text Block]

The Company's revenue recognition related to performance obligations that were satisfied at a point in time and over time were as follows:

Fiscal year ended	2018		2017		2016
Point in time	60	%	91	%	95	%
Over time	40	%	9	%	5	%

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Related Party Transactions (Notes)

12 Months Ended

Dec. 29, 2018

Related Party Transactions [Abstract]

Schedule of Related Party Transactions [Table Text Block]

16.    Related Party Transactions

The Company may from time to time enter into agreements with shareholders, affiliates and other companies engaged in certain aspects of the display, electronics, optical and software industries as part of our business strategy. In addition, the wearable computing product market is relatively new and there may be other technologies the Company needs to purchase from affiliates in order to enhance its product offering.

The Company and Goertek have entered into agreements to jointly develop and commercialize a range of technologies and wearable products. These include: a mutually exclusive supply and manufacturing arrangement for a certain display product for twenty four months after mass production begins; an agreement that provides the Company with the right of first refusal to invest in certain manufacturing capacity for certain products with Goertek; an agreement whereby Goertek will provide system level original equipment manufacturing services for the Company's wearable products; an arrangement whereby the Company will supply display modules for Goertek's virtual reality and augmented reality products; and other agreements related to promotion around certain products as well as providing designs relating to head mounted displays.

The Company and RealWear, Inc. have entered into agreements where the Company has agreed to supply display modules for RealWear, Inc.'s augmented reality products. The Company has also licensed certain intellectual property to RealWear, Inc. and the Company received a 15% warrant in RealWear, Inc.'s next equity offering round, which was exercised in April 2018. The Company also received a $1.5 million license fee for the intellectual property licensed to RealWear, Inc. and the Company is entitled to receive sales-based royalties from RealWear, Inc.

During fiscal years 2018, 2017 and 2016, the Company had the following transactions with related parties:

	2018				2017				2016
	Revenue		Purchases		Revenue		Purchases		Revenue		Purchases
Goertek	$	—	$	646,135	$	—	$	727,101	$	—	$	—
RealWear, Inc.	1,220,838		—		576,644		—		—		—
	$	1,220,838	$	646,135	$	576,644	$	727,101	$	—	$	—

At December 29, 2018 and December 30, 2017, the Company had the following receivables and payables with related parties:

	December 29, 2018						December 30, 2017
	Receivables		Contract Assets		Payables		Receivables		Payables
Goertek	$	—	$	—	$	207,530	$	—	$	326,877
RealWear, Inc.	1,041,334		400,000		—		414,635		—
	$	1,041,334	$	400,000	$	207,530	$	414,635	$	326,877

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Restatement of Previously Issued Financial Statements (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 29, 2018	Sep. 29, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016	Dec. 26, 2015
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ 47,712,821				$ 77,379,847				$ 47,712,821	$ 77,379,847	$ 74,219,643	$ 94,484,780
Translation Adjustment Functional to Reporting Currency, Gain (Loss), Reclassified to Earnings, Net of Tax									400,000
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders									(699,105)	(791,737)
Distribution to noncontrolling interest holder									699,105	791,737
Net Income (Loss) Attributable to Noncontrolling Interest									51,050	(139,633)	537,572
Net Income (Loss) Attributable to Parent	(9,966,000)	$ (9,791,000)	$ (9,241,000)	$ (5,536,000)	(1,803,000)	$ (8,247,000)	$ (7,332,000)	$ (7,858,000)	(34,533,542)	(25,240,482)	(23,568,717)
Foreign Currency Transaction Gain (Loss), Unrealized									1,169,254	(1,068,059)	(672,727)
Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Distribution to noncontrolling interest holder									62,127
Net Income (Loss) Attributable to Noncontrolling Interest											134,601
Net Income (Loss) Attributable to Parent									1,336,083		(134,601)
Foreign Currency Transaction Gain (Loss), Unrealized									1,336,083
Additional Paid-in Capital
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	334,491,397				329,917,858				334,491,397	329,917,858	327,323,162	325,357,045
Adjustments to Additional Paid in Capital									(10,930)	(11,708)	(7,368)
Additional Paid-in Capital | Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(1,201,482)				(1,201,482)				(1,201,482)	(1,201,482)	(1,201,482)	(1,201,482)
Noncontrolling Interest
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ (149,053)				616,661				(149,053)	616,661	1,478,040	945,386
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders									(699,105)	(791,737)
Noncontrolling Interest | Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest					1,336,083					1,336,083	$ 1,336,083	$ 1,201,482
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders									$ 1,336,083
Kowon Technology Corporation Limited [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax					$ 1,700,000					$ 1,700,000

XML

Segments and Disaggregation of Revenue (Percentage of Net Revenues by Geographies) (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 29, 2018	Sep. 29, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 7,741,000	$ 5,126,000	$ 5,944,000	$ 5,654,000	$ 11,397,000	$ 6,139,000	$ 5,927,000	$ 4,378,000	$ 24,465,005	$ 27,841,490	$ 22,642,566
Percent of Total									100.00%	100.00%	100.00%
UNITED STATES
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 14,436,000	$ 16,540,000	$ 9,237,000
Percent of Total									59.00%	59.00%	41.00%
Others
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 123,000	$ 86,000	$ 41,000
Percent of Total									1.00%	0.00%	0.00%
Americas
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 14,559,000	$ 16,626,000	$ 9,278,000
Percent of Total									60.00%	60.00%	41.00%
Asia-Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 6,916,000	$ 5,406,000	$ 9,849,000
Percent of Total									28.00%	19.00%	43.00%
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 2,948,000	$ 5,810,000	$ 3,516,000
Percent of Total									12.00%	21.00%	16.00%
Others [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 42,000
Percent of Total									0.00%
Kopin [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 16,981,000	$ 15,942,000	$ 18,733,000
Percent of Total									69.00%	57.00%	82.00%
Kopin [Member] | UNITED STATES
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 10,799,000	$ 10,056,000	$ 8,847,000
Percent of Total									44.00%	36.00%	39.00%
Kopin [Member] | Others
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 49,000	$ 24,000	$ 41,000
Percent of Total									0.00%	0.00%	0.00%
Kopin [Member] | Americas
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 10,848,000	$ 10,080,000	$ 8,887,000
Percent of Total									44.00%	36.00%	39.00%
Kopin [Member] | Asia-Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 4,932,000	$ 4,006,000	$ 7,588,000
Percent of Total									20.00%	14.00%	33.00%
Kopin [Member] | Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 1,194,000	$ 1,856,000	$ 2,258,000
Percent of Total									5.00%	7.00%	10.00%
Kopin [Member] | Others [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 7,000
Percent of Total									0.00%
Industrial [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 7,484,000	$ 11,900,000	$ 3,909,000
Percent of Total									30.00%	43.00%	18.00%
Industrial [Member] | UNITED STATES
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 3,637,000	$ 6,484,000	$ 390,000
Percent of Total									15.00%	23.00%	2.00%
Industrial [Member] | Others
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 74,000	$ 62,000	$ 0
Percent of Total									0.00%	0.00%	0.00%
Industrial [Member] | Americas
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 3,712,000	$ 6,545,000	$ 390,000
Percent of Total									15.00%	24.00%	2.00%
Industrial [Member] | Asia-Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 1,984,000	$ 1,401,000	$ 2,260,000
Percent of Total									8.00%	5.00%	10.00%
Industrial [Member] | Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 1,754,000	$ 3,954,000	$ 1,258,000
Percent of Total									7.00%	14.00%	6.00%
Industrial [Member] | Others [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 35,000
Percent of Total									0.00%

XML

Restatement of Previously Issued Financial Statements (Tables)

12 Months Ended

Dec. 29, 2018

Restatement of Previously Issued Financial Statements [Abstract]

Restatement of Stockholders' Equity [Table Text Block]

The effects of these adjustments on the consolidated statements of stockholders’ equity are as follows:

	Addition Paid-in Capital				Accumulated Deficit						Noncontrolling Interest
	As Previously Reported	Adjustment		As Revised	As Previously Reported		Adjustment		As Revised		As Previously Reported		Adjustment		As Revised
Balance at December 26, 2015	326,558,527	(1,201,482	)	325,357,045	(190,608,671	)	—		(190,608,671	)	(256,096	)	1,201,482		945,386
Net (loss) income	—	—		—	(23,434,116	)	(134,601	)	(23,568,717	)	402,971		134,601		537,572
Balance at December 31, 2016	328,524,644	(1,201,482	)	327,323,162	(214,042,787	)	(134,601	)	(214,177,388	)	141,957		1,336,083		1,478,040
Balance at December 30, 2017	331,119,340	(1,201,482	)	329,917,858	(240,121,901	)	(134,601	)	(240,256,502	)	(719,422	)	1,336,083		616,661
Distribution to noncontrolling interest holder	—	—		—	—		—		—		636,978		(1,336,083	)	(699,105	)
Net (loss) income	—	—		—	(35,869,625	)	1,336,083		(34,533,542	)	51,050		—		51,050
Balance at December 29, 2018	335,692,879	(1,201,482	)	334,491,397	(272,932,143	)	1,201,482		(271,730,661	)	(149,053	)	—		(149,053	)

Restatement to Prior Year Income [Table Text Block]

The effects of these adjustments on the consolidated statements of operations are as follows:

	As Previously Reported			Adjustment			As Revised
2018
Foreign currency transaction gains (losses)	$	(166,829	)	$	1,336,083		$	1,169,254
2016
Net income attributable to noncontrolling interest	402,971			134,601			537,572
Net loss attributable to Kopin Corporation	$	(23,434,116	)	$	(134,601	)	$	(23,568,717	)

Restatement of Cash Flows [Table Text Block]

The effects of these adjustments on the consolidated statements of cash flows are as follows:

	As Previously Reported			Adjustment			As Revised
2018
Cash flows from operating activities:
Net loss	$	(35,818,575	)	$	1,336,083		$	(34,482,492	)
Foreign currency (gains) losses	177,469			(1,273,956		)	(1,096,487		)
Cash flows from financing activities
Distribution to noncontrolling interest holder	$	(636,978	)	$	(62,127	)	$	(699,105	)

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Contract Assets and Liabilities (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2017
Contract Assets and Liabilities [Abstract]
Contract with Customer, Asset, Net	$ 3,089,663	$ 704,863	$ 3,555,137
Contract with Customer, Liability, Current	(388,933)		(664,146)
Contract Liability, Net, Noncurrent	(17,294)	(374,171)	(374,171)
Contract Assets (Liabilities), Net	2,683,436		$ 2,516,820
Change in Contract Assets	$ (465,474)
Change in Contract Asset Percent Change	(13.00%)
Change in Contract Liabilities	$ 275,213
Change in Contract Liability Percent Change	(41.00%)
Change in Contract Liabilities-Noncurrent	$ 356,877
Percent Change in Contract Liabilities-Noncurrent	(95.00%)
Change in Contract Assets (Liabilities), Net	$ 166,616
Change in Contract Assets (Liabilities) Net Percent Change	7.00%
Contract with Customer, Liability, Revenue Recognized	$ 300,000	$ 400,000

XML

Concentrations of Risk (Details)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Concentration Risk [Line Items]
Concentrations of risk, percentage	10.00%
Percent of Gross Accounts Receivable | Credit concentration risk | Scott Safety [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage		14.00%
Percent of Gross Accounts Receivable | Credit concentration risk | RealWear, Inc. [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage	31.00%	10.00%
Percent of Gross Accounts Receivable | Credit concentration risk | DRS Technologies [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage	11.00%
Percent of Gross Accounts Receivable | Credit concentration risk | Collins Aerospace [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage	11.00%
Percent of Gross Accounts Receivable | Credit concentration risk | U.S. Army [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage		43.00%
Sales as a Percent of Total Revenue | Customer concentration risk | DRS Technologies [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage		10.00%
Sales as a Percent of Total Revenue | Customer concentration risk | Collins Aerospace [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage	20.00%	10.00%	12.00%
Sales as a Percent of Total Revenue | Customer concentration risk | Shenzhen Oriscape [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage			20.00%
Sales as a Percent of Total Revenue | Customer concentration risk | Military Customers in Total
Concentration Risk [Line Items]
Concentrations of risk, percentage	36.00%	48.00%	24.00%
Sales as a Percent of Total Revenue | Customer concentration risk | General Dynamics [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage	11.00%
Sales as a Percent of Total Revenue | Customer concentration risk | U.S. Army [Member]
Concentration Risk [Line Items]
Concentrations of risk, percentage		12.00%
Sales as a Percent of Total Revenue | United States Government Funded Research and Development Contracts
Concentration Risk [Line Items]
Concentrations of risk, percentage	20.00%	11.00%	7.00%

XML

Financial Instruments (Contractual Maturities) (Details) - USD ($)	Dec. 29, 2018	Dec. 30, 2017
Available-for-sale Securities Contractual Maturities
Less than One year	$ 6,450,257
One to Five years	16,467,759
Debt Securities, Available-for-sale	22,918,016	$ 43,907,457
US Government Agencies Debt Securities [Member]
Available-for-sale Securities Contractual Maturities
Less than One year	3,741,183
One to Five years	9,069,740
Debt Securities, Available-for-sale	12,810,923	34,725,811
Corporate Debt Securities [Member]
Available-for-sale Securities Contractual Maturities
Less than One year	2,709,074
One to Five years	7,398,019
Debt Securities, Available-for-sale	$ 10,107,093	$ 8,980,906

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Commintments and Contingencies (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2019	$ 1,210,000
2020	1,112,000
2021	921,000
2022	616,000
2023	201,000
Thereafter	0
Total minimum lease payments	4,060,000
Rent expense	1,400,000	$ 1,500,000	$ 1,300,000
Payments to Acquire Investments	5,100,000
Cash, Commitment to Purchase Equity Investment (RMB)	$ 35,000,000.0

XML

Summary of Significant Accounting Policies

12 Months Ended

Dec. 29, 2018

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

 Summary of Significant Accounting Policies (As Revised)

The preparation of consolidated 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 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. As used in these notes, the terms “we,” “us,” “our,” “Kopin” and the “Company” mean Kopin Corporation and its subsidiaries, unless the context indicates another meaning.

Going Concern

The Company has incurred net losses of $34.5 million, $25.4 million and $23.0 million for the fiscal years ended 2018, 2017 and 2016, respectively, and net cash outflows from operations of $28.1 million, $25.9 million and $26.2 million for the fiscal years ended 2018, 2017 and 2016, respectively. In addition, the Company has continued to experience a significant decline in its cash and cash equivalents and marketable debt securities, which was primarily a result of funding operating losses, of which a significant component relates to the Company’s ongoing investments in the research and development of Wearable products. These negative financial conditions raise substantial doubt regarding the Company’s ability to continue as a going concern.

The Company’s products are targeted towards the wearable market, which management believes is still developing and cannot predict how long the wearable market will take to develop or if the Company’s products will be accepted.  Accordingly, the Company’s current strategy is to continue to invest in research and development, even during unprofitable periods, which may result in the Company continuing to incur net losses and negative cash flows from operations.  If the Company is unable to achieve and maintain positive cash flows and profitability in the foreseeable future, its financial condition may ultimately be materially adversely affected such that management may be required to reduce operating expenses, including investments in research and development, or raise additional capital. While there can be no assurance the Company will be able to successfully reduce operating expenses or raise additional capital, management believes its historical success in managing cash flows and obtaining capital will continue in the foreseeable future.

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Fiscal Year

The Company’s fiscal year ends on the last Saturday in December. The fiscal years ended December 29, 2018 and December 30, 2017 includes 52 weeks and December 31, 2016 includes 53 weeks, and are referred to as fiscal years 2018, 2017 and 2016, respectively, herein. The impact of the 53^rd week in the 2016 fiscal year was not material to the Company's results of operations.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and a majority owned 80% subsidiary, eMDT America Inc. ("eMDT"), located in California (collectively the Company). Net loss attributable to noncontrolling interest in the Company's Consolidated Statement of Operations represents the portion of the results of operations of which is allocated to the shareholders of the equity interests not owned by the Company. All intercompany transactions and balances have been eliminated.

Revenue Recognition - 2018

The Company adopted ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) effective December 31, 2017 and applied the modified retrospective method. The Company recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of accumulated deficit. The comparative information has not been revised and continues to be reported under the accounting standards in effect for those periods. The Company expects the impact of the adoption of the new standard to be material to the Company's results of operations on an ongoing basis. Significant changes to the Company's accounting policies as a result of adopting Topic 606 are discussed below.

Substantially all of our product revenues are either derived from the sales of components for use in military applications or our wearable technology components that can be integrated to create industrial and consumer headset systems. We also have development contracts for the design, manufacture and modification of products for the U.S. government or a prime contractor

for the U.S. government or for a customer that sells into the industrial or consumer markets. The Company's contracts with the U.S. government are typically subject to the Federal Acquisition Regulations (“FAR”) and are priced based on estimated or actual costs of producing goods. The FAR provides guidance on the types of costs that are allowable in establishing prices for goods provided under U.S. government contracts. The pricing for non-U.S. government contracts is based on the specific negotiations with each customer.

Our fixed-price contracts with the U.S. government or other customers may result in revenue recognized in excess of amounts currently billed. We disclose the excess of revenues over amounts actually billed as Contract assets and unbilled receivables on the balance sheet. Amounts billed and due from our customers are classified as Accounts receivable on the balance sheets. In some instances, the U.S. government retains a small portion of the contract price until completion of the contract. The portion of the payments retained until final contract settlement is not considered a significant financing component because the intent is to protect the customer. For contracts with the U.S. government, we typically receive interim payments either as work progresses or by achieving certain milestones or based on a schedule in the contract. We recognize a liability for these advance payments in excess of revenue recognized and present it as Contract liabilities and billings in excess of revenue earned on the balance sheets. The advanced payment typically is not considered a significant financing component because it is used to meet working capital demands that can be higher in the early stages of a contract and to protect us from the other party failing to adequately complete some or all of its obligations under the contract. For industrial and consumer purchase orders, we typically receive payments within 30 to 60 days of shipments of the product, although for some purchase orders, we may require an advanced payment prior to shipment of the product.

To determine the proper revenue recognition method for contracts with the same customer, we evaluate whether two or more contracts should be combined and accounted for as one single contract and whether the combined or single contract should be accounted for as more than one performance obligation. For most of our development contracts and contracts with the U.S government, the customer contracts with us to provide a significant service of integrating a set of components into a single unit. Hence, the entire contract is accounted for as one performance obligation. Less frequently, however, we may promise to provide distinct goods or services within a contract in which case we separate the contract into more than one performance obligation. If a contract is separated into more than one performance obligation, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. In cases where we sell standard products, the observable standalone sales are used to determine the standalone selling price.

The Company recognizes revenue from a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable.

Commencing in 2018 for certain contracts with the U.S. government, the Company recognizes revenue over time as we perform because of continuous transfer of control to the customer and the lack of an alternative use for the product. The continuous transfer of control to the customer is supported by liability clauses in the contract that allow the U.S. government to unilaterally terminate the contract for convenience, pay us for costs incurred plus a reasonable profit and take control of any work in process. For contracts with commercial customers, while the contract may have a similar liability clause, our products historically have an alternative use and thus, revenue is recognized at a point in time.

In situations where control transfers over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. We generally use the cost-to-cost approach to measure the extent of progress towards completion of the performance obligation for our contracts because we believe it best depicts the transfer of assets to the customer. Under the cost-to-cost measure approach, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues are recorded proportionally as costs are incurred.

Accounting for design, development and production contracts requires judgment relative to assessing risks, estimating contract revenues and costs, and making assumptions for schedule and technical issues. Due to the size and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. We have to make assumptions regarding the number of labor hours required to complete a task, the complexity of the work to be performed, the availability and cost of materials, and performance by our subcontractors. For contract change orders, claims or similar items, we apply judgment in estimating the amounts and assessing the potential for realization. These amounts are only included in contract value when they can be reliably estimated and realization is considered probable. If our estimate of total contract costs or our determination of whether the customer agrees that a milestone is achieved is incorrect, our revenue could be overstated or understated and the profits or loss reported could be subject to adjustment.

For our commercial customers, the Company's revenue is recognized when obligations under the terms of a contract with our customer is satisfied and the Company transfers control of the products or services, which is generally upon delivery to the customer. Revenue is recorded as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Provisions for product returns and allowances are reductions in the transaction price and are recorded in the same period as the related revenues. We analyze historical returns, current economic trends and changes in customer demand when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for stocking of inventory. Sales, value add and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.

The rights and benefits to the Company's intellectual property are conveyed to certain customers through technology license agreements. These agreements may include other performance obligations including the sale of product to the customer. When the license is distinct from other obligations in the agreement, the Company treats the license and other performance obligations as separate performance obligations. Accordingly, the license is recognized at a point in time or over time based on the standalone selling price. The sale of materials is recognized at a point in time, which occurs with the transfer of control of the Company's products or services. In certain instances, the Company is entitled to sales-based royalties under license agreements. These sales-based royalties are recognized when they are earned. Revenues from sales-based royalties under license agreements are shown under Research and development and other revenues on the Company's Consolidated Statements of Operations.

The cumulative effect of the changes made to the Company's consolidated December 31, 2017 balance sheet for the adoption of ASU 2014-09, Revenue from Contracts with Customers (Topic 606) was as follows:

Balance Sheet	Balance at December 30, 2017			Adjustments due to Topic 606			Balance at December 31, 2017
Assets
Contract assets and unbilled receivables	$	704,863		$	2,850,274		$	3,555,137
Inventory	5,080,797			(1,082,629		)	3,998,168
Other assets	3,842,068			400,000			4,242,068
Liabilities
Contract liabilities and billings in excess of revenue earned	1,555,883			(891,737		)	664,146
Stockholders’ equity
Accumulated Deficit1	$	(240,256,502	)	$	3,059,383		$	(237,197,119	)

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

In accordance with the new revenue standard requirements, the impact of adoption on the Company's consolidated statement of operations for the fiscal year 2018 was as follows:

Statement of Operations	As Reported			Balances Without Adoption of Topic 606			Effect of Change Higher/(Lower)
Net product revenues	$	19,211,115		$	19,726,901		$	(515,786	)
Research and development and other revenues	5,253,890			5,600,066			(346,176		)
Cost of product revenues	15,831,441			16,809,343			(977,902		)
Net loss attributable to Kopin Corporation	$	(34,533,542	)	$	(34,649,482	)	$	115,940

See Note 14. Segments and Disaggregation of Revenue for additional information regarding the disaggregation of the Company's revenue by major source.

Contract Assets

Contract assets include unbilled amounts typically resulting from sales under contracts when the cost-to-cost method of revenue recognition is utilized and revenue recognized from customer arrangements, including licensing, exceeds the amount billed to the customer, and right to payment is not just subject to the passage of time. Amounts may not exceed their net realizable value. Contract assets are generally classified as current. The Company classifies the noncurrent portion of contract assets under other assets in its condensed consolidated balance sheets.

Contract Liabilities

Contract liabilities consist of advance payments and billings in excess of revenue recognized for the contract.

Performance Obligations

The Company's revenue recognition related to performance obligations that were satisfied at a point in time and over time were as follows:

Fiscal year ended	2018		2017		2016
Point in time	60	%	91	%	95	%
Over time	40	%	9	%	5	%

The value of remaining performance obligations represent the transaction price of orders for which work has not been performed and excludes unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity ("IDIQ")). As of December 29, 2018, the aggregate amount of the transaction price allocated to remaining performance obligations was $8.0 million. The Company expects to recognize revenue on the remaining performance obligations of $8.0 million over the next 12 months. The remaining performance obligations represent amounts to be earned under government contracts, which are subject to cancellation.

Revenue Recognition - 2017

We recognize revenue if four basic criteria have been met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred and services rendered; (3) the price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. We do not recognize revenue for products prior to customer acceptance unless we believe the product meets all customer specifications and has a history of consistently achieving customer acceptance of the product. Provisions for product returns and allowances are recorded in the same period as the related revenues. We analyze historical returns, current economic trends and changes in customer demand and acceptance of product when evaluating the adequacy of sales returns and other allowances. Certain product sales are made to distributors under agreements allowing for a limited right of return on unsold products. Sales to distributors are primarily made for sales to the distributors' customers and not for stocking of inventory. We delay revenue recognition for our estimate of distributor claims of right of return on unsold products based upon our historical experience with our products and specific analysis of amounts subject to return based upon discussions with our distributors or their customers.

We recognize revenues from long-term research and development government contracts on the percentage-of-completion method of accounting as work is performed, based upon the ratio of costs or hours already incurred to the estimated total cost of completion or hours of work to be performed. Revenue recognized at any point in time is limited to the amount funded by the U.S. government or contracting entity. We recognize revenue for product development and research contracts that have established prices for distinct phases when delivery and acceptance of the deliverable for each phase has occurred. In some instances, we are contracted to create a deliverable which is anticipated to go into full production. In those cases, we discontinue the percentage-of-completion method after formal qualification of the deliverable has been completed and revenue is then recognized based on the criteria established for sale of products. In certain instances, qualification may be achieved and delivery of production units may commence however our customer may have either identified new issues to be resolved or wish to incorporate a newer display technology. In these circumstances new units delivered will continue to be accounted for under the criteria established for sale of products. Under certain of our research and development contracts, we recognize revenue using a milestone methodology. This revenue is recognized when we achieve specified milestones based on our past performance.

We classify amounts earned on contracts in progress that are in excess of amounts billed as unbilled receivables and we classify amounts received in excess of amounts earned as billings in excess of revenues earned. We invoice based on dates specified in the related agreement or in periodic installments based upon our invoicing cycle. We recognize the entire amount of an estimated ultimate loss in our financial statements at the time the loss on a contract becomes known.

Accounting for design, development and production contracts requires judgment relative to assessing risks, estimating contract revenues and costs, and making assumptions for schedule and technical issues. Due to the size and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor and subcontracting costs, as well as an allocation of indirect costs. We have to make assumptions regarding the number of labor hours required to complete a task, the complexity of the work to be performed, the availability and cost of materials, and performance by our subcontractors. For contract change orders, claims or similar items, we apply judgment in estimating the amounts and assessing the potential for realization. These amounts are only included in contract value when they can be reliably estimated and realization is considered probable. We

have accounting policies in place to address these as well as other contractual and business arrangements to properly account for long-term contracts. If our estimate of total contract costs or our determination of whether the customer agrees that a milestone is achieved is incorrect, our revenue could be overstated and profits would be negatively impacted.

Research and Development Costs

Research and development expenses are incurred in support of internal display product development programs or programs funded by agencies or prime contractors of the U.S. government and commercial partners. Research and development costs include staffing, purchases of materials and laboratory supplies, circuit design costs, fabrication and packaging of experimental display products, and overhead, and are expensed immediately.

Cash and Cash Equivalents

The Company considers all highly liquid, short-term debt instruments with original maturities of three months or less to be cash equivalents.

Inventory

Inventories are stated at standard cost adjusted to approximate the lower of cost (first-in, first-out method) or net realizable value. The Company adjusts inventory carrying value for estimated obsolescence equal to the difference between the cost of inventory and the estimated net realizable value based upon assumptions about future demand and market conditions. The Company fully reserves for inventories and non-cancellable purchase orders for inventory deemed obsolete. The Company performs periodic reviews of inventory items to identify excess inventories on hand by comparing on-hand balances to anticipated usage using recent historical activity as well as anticipated or forecasted demand. If estimates of customer demand diminish further or market conditions become less favorable than those projected by the Company, additional inventory adjustments may be required.

We regularly review inventory quantities on-hand and we write down inventory based on excess or obsolete inventories determined primarily by future anticipated demand for our products. Inventory write-downs are measured as the difference between the cost of the inventory and net realizable value, based upon assumptions about future demand, which are inherently difficult to assess and dependent on market conditions. At the point of a loss recognition, a new, lower cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase in that newly established basis.

Inventory consists of the following at December 29, 2018 and December 30, 2017:

	2018		2017
Raw materials	$	2,548,139	$	2,070,153
Work-in-process	1,526,552		1,829,805
Finished goods	722,547		1,180,839
	$	4,797,238	$	5,080,797

Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets, generally 3 to 10 years. Leasehold improvements and leased equipment are amortized over the shorter of the term of the lease or the useful life of the improvement or equipment. As discussed below, obligations for asset retirement are accrued at the time property, plant and equipment is initially purchased or as such obligations are generated from use.

Collaborative Arrangements

The Company evaluates whether an arrangement is a collaborative arrangement under the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) Topic 808, Collaborative Arrangements, at its inception based on the facts and circumstances specific to the arrangement. The Company also reevaluates whether an arrangement qualifies or continues to qualify as a collaborative arrangement whenever there is a change in either the roles of the participants or the participants’ exposure to significant risks and rewards dependent on the ultimate commercial success of the endeavor. For those collaborative arrangements where it is determined that the Company is the principal participant, costs incurred and revenue generated from third parties are recorded on a gross basis in the financial statements.

From time to time, the Company enters into collaborative arrangements for the research and development, manufacture and/or commercialization of products. The Company’s collaboration agreements with third parties are performed on a ‘‘best efforts’’ basis with no guarantee of either technological or commercial success.

Product Warranty

The Company generally sells products with a limited warranty of product quality and a limited indemnification of customers against intellectual property infringement claims related to the Company’s products. The Company accrues for known warranty and indemnification issues if a loss is probable and can be reasonably estimated, and accrues for estimated incurred but unidentified issues based on historical activity. Accrued warranty costs and warranty claims are not material in the periods presented.

Extended Warranties

The Company recognizes revenue from an extended warranty on the straight-line method over the life of the extended warranty, which is typically 12 to 18 months beyond the standard 12 month warranty. The Company classifies the current portion of extended warranties under contract liabilities and billings in excess of revenue earned and the noncurrent portion of extended warranties under contract liabilities, noncurrent in its consolidated balance sheets. The Company currently has approximately $0.4 million of contract liabilities related to extended warranties at December 29, 2018.

Asset Retirement Obligations

The Company recorded asset retirement obligations ("ARO") liabilities of $0.3 million at December 29, 2018 and December 30, 2017. This represents the legal obligations associated with retirement of the Company’s assets when the timing and/or method of settling the obligation are conditional on a future event that may or may not be within the control of the Company. Changes in ARO liabilities for fiscal years 2018 and 2017 are as follows:

	2018			2017
Beginning balance	$	269,877		$	246,922
Exchange rate change	(15,779		)	22,955
Ending balance	$	254,098		$	269,877

Income Taxes

The consolidated financial statements reflect provisions for federal, state, local and foreign income taxes. The Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, as well as operating loss and tax credit carryforwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carryforwards 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. The Company provides valuation allowances if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Foreign Currency

Assets and liabilities of non-U.S. operations where the functional currency is other than the U.S. dollar are translated from the functional currency into U.S. dollars at year end exchange rates, and revenues and expenses are translated at average rates prevailing during the year. Resulting translation adjustments are accumulated as part of accumulated other comprehensive income. Transaction gains or losses are recognized in income or loss in the period in which they occur.

Net Loss Per Share

Basic net loss per share is computed using the weighted-average number of shares of common stock outstanding during the period less any unvested restricted shares. Diluted net loss per share is calculated using weighted-average shares outstanding and contingently issuable shares, less weighted-average shares reacquired during the period. The net outstanding shares are adjusted for the dilutive effect of shares issuable upon the assumed conversion of the Company’s common stock equivalents, which consist of outstanding stock options and unvested restricted stock.

The following were not included in weighted-average common shares outstanding-diluted because they are anti-dilutive or performance conditions have not been met at the end of the period:

	2018	2017	2016
Nonvested restricted common stock	2,213,249	2,629,274	3,007,674

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk other than marketable securities consist principally of trade accounts receivable. Trade receivables are primarily derived from sales to manufacturers of consumer electronic devices and wireless components or military applications. The Company sells its products to customers worldwide and generally does not require collateral. The Company maintains a reserve for potential credit losses.

The Company primarily invests its excess cash in government backed and corporate debt securities that management believes to be of high credit worthiness, which bear lower levels of relative credit risk. The Company relies on rating agencies to ascertain the credit worthiness of its marketable securities and, where applicable, guarantees made by the Federal Deposit Insurance Company.

Fair Value of Financial Instruments

Financial instruments consist of marketable debt securities, accounts receivable and certain current liabilities. These assets (excluding marketable securities which are recorded at fair value) and liabilities are carried at cost, which approximates fair value.

Recognition and Measurement of Financial Assets and Liabilities

We periodically make equity investments in private companies, accounted for as an equity investment, whose values are difficult to determine. The Company adopted ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities and the related amendments on December 31, 2017. This standard amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The Company adopted the measurement alternative for equity investments without readily determinable fair values (often referred to as cost method investments) on a prospective basis. When assessing investments in private companies for impairment, we consider such factors as, among other things, the share price from the investee's latest financing round, the performance of the investee in relation to its own operating targets and its business plan, the investee's revenue and cost trends, the liquidity and cash position, including its cash burn rate and market acceptance of the investee's products and services. Because these are private companies which we do not control we may not be able to obtain all of the information we would want in order to make a complete assessment of the investment on a timely basis. Accordingly, our estimates may be revised if other information becomes available at a later date.

Marketable Debt Securities

Marketable debt securities consist primarily of commercial paper, medium-term corporate notes, and U.S. government and agency backed securities. The Company classifies these marketable debt securities as available-for-sale at fair value in “Marketable debt securities, at fair value”. The Company's investment in GCS Holdings is included in "Other Assets" as available-for-sale and at fair value. The Company records the amortization of premium and accretion of discounts on marketable debt securities in the results of operations.

The Company uses the specific identification method as a basis for determining cost and calculating realized gains and losses with respect to marketable debt securities. The gross gains and losses realized related to sales and maturities of marketable debt securities were not material during the fiscal years ended 2018, 2017 and 2016.

Other-than-Temporary Impairments

The Company conducts a review of its marketable debt securities on a quarterly basis for the presence of other-than-temporary impairment ("OTTI"). The Company assesses whether OTTI is present when the fair value of a debt security is less than its amortized cost basis at the balance sheet date. Under these circumstances OTTI is considered to have occurred (1) if the Company intends to sell the security before recovery of its amortized cost basis; (2) if it is “more likely than not” the Company will be required to sell the security before recovery of its amortized cost basis; or (3) the present value of expected cash flows is not sufficient to recover the entire amortized cost basis.

The Company further estimates the amount of OTTI resulting from a decline in the creditworthiness of the issuer (credit-related OTTI) and the amount of non credit-related OTTI. Non credit-related OTTI can be caused by such factors as market illiquidity. Credit-related OTTI is recognized in earnings while non credit-related OTTI on securities not expected to be sold is

recognized in other comprehensive income (loss). The Company did not record any OTTI for the fiscal years 2018, 2017 and 2016.

Stock-Based Compensation

The fair value of nonvested restricted common stock awards is generally the quoted price of the Company’s equity shares on the date of grant. The nonvested restricted common stock awards require the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also require meeting either performance criteria or market condition. The performance criteria primarily consist of the achievement of established milestones. For nonvested restricted common stock awards which solely require the recipient to remain employed with the Company, the stock compensation expense is amortized over the anticipated service period. For nonvested restricted common stock awards which require the achievement of performance criteria, the Company reviews the probability of achieving the performance goals on a periodic basis. If the Company determines that it is probable that the performance criteria will be achieved, the amount of compensation cost derived for the performance goal is amortized over the service period. If the performance criteria are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed. The Company recognizes compensation costs on a straight-line basis over the requisite service period for time vested awards.

The value of restricted stock grants that vest based on market conditions is computed on the date of grant using the Monte Carlo model. The fair value of stock option awards is estimated on the date of grant using the Black-Scholes-Merton option-pricing model. There were no stock options granted in fiscal years 2018, 2017 or 2016.

Comprehensive Loss

Comprehensive loss is the total of net (loss) income and all other non-owner changes in equity including such items as unrealized holding (losses) gains on marketable equity and debt securities classified as available-for-sale and foreign currency translation adjustments.

The components of accumulated other comprehensive income are as follows:

	Cumulative Translation Adjustment			Unrealized holding (loss) gain on marketable securities			Reclassifications of gain (loss) in net loss			Accumulated Other Comprehensive Income
Balance as of December 26, 2015	$	566,025		$	205,749		$	—		$	771,774
Changes during year	814,017			33,464			(48,284		)	799,197
Balance as of December 31, 2016	1,380,042			239,213			(48,284		)	1,570,971
Changes during year	1,851,664			148,520			(6,376		)	1,993,808
Balance as of December 30, 2017	3,231,706			387,733			(54,660		)	3,564,779
Changes during year	(1,794,768		)	(264,949		)	49,525			(2,010,192		)
Balance as of December 29, 2018	$	1,436,938		$	122,784		$	(5,135	)	$	1,554,587

Goodwill

We account for goodwill in accordance with ASC Topic 350. Under ASC Topic 350, goodwill is considered to have an indefinite life, and is carried at cost. Goodwill is not amortized, but is subject to an annual impairment test, as well as between annual tests when events or circumstances indicate that the carrying value may not be recoverable.

The determination of reporting units under ASC 350 begins with the definition of an operating segment in ASC 280 and takes into account the disaggregation of that operating segment into economically dissimilar components for goodwill impairment testing purposes. The level at which operating performance is reviewed also differs between ASC 280 and ASC 350. The chief operating decision maker ("CODM") is the Company's Chief Executive Officer who reviews operating segments and the segment manager reviews reporting units (components of operating segments). Therefore, a component of an operating segment would not be considered an operating segment under ASC 280 unless the CODM regularly reviews its operating performance. However, that same component might be a reporting unit under ASC 350 if a segment manager regularly reviews its operating performance (and if the other reporting unit criteria are met). Goodwill is evaluated for impairment annually or more often if indicators of a potential impairment are present. The Company performs impairment tests of goodwill at its reporting unit level. The goodwill valuations that are utilized to test these assets for impairment are depending on a number of significant estimates and assumptions, including macroeconomic conditions, overall growth rates, competitive activities, cost containment, Company business plans and the discount rate applied to cash flows. We believe these estimates and assumptions are reasonable and are comparable to those that would be used by other market participants. However, actual events and results

could differ substantially from those used in our valuations. To the extent such factors result in a failure to achieve the level of projected cash flows initially used to estimate fair value for purposes of establishing the carrying amount of goodwill and intangibles, we may need to record non-cash impairment charges in the future.  

Impairment of Long-Lived Assets

The Company periodically reviews the carrying value of its long-lived assets to determine if facts and circumstances suggest that they may be impaired or that the amortization or depreciation period may need to be changed. The carrying value of a long-lived asset is considered impaired when the anticipated identifiable undiscounted cash flows from such asset are less than its carrying value. For assets that are to be held and used, impairment is measured based upon the amount by which the carrying amount of the asset exceeds its fair value.

Recently Issued Accounting Pronouncements

Leases

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize a right-of-use asset and lease liability for most lease arrangements. The new standard is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which allows for an additional transition method under the modified retrospective approach for the adoption of Topic 842. The two permitted transition methods are now: (1) to apply the new lease requirements at the beginning of the earliest period presented, and (2) to apply the new lease requirements at the effective date. Under both transition methods there is a cumulative effect adjustment. We intend to adopt the standard on the effective date of December 30, 2018 by applying the new lease requirements at the effective date. We also intend to elect the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allows us to carry forward the historical lease classification. We have evaluated the changes from this ASU to our future financial reporting and disclosures, and have designed and implemented related processes and controls to address these changes. We expect the standard will result in the recognition of right-of-use assets of $3.5 million to $4.0 million and lease liabilities of $3.5 million to $4.0 million as of December 30, 2018, with immaterial changes to other balance sheet accounts. The standard will have no impact on our results of operations or liquidity. In addition, new disclosures will be provided to enable users to assess the amount, timing and uncertainty of cash flows arising from leases.

Other new pronouncements issued but not effective until after December 29, 2018 are not expected to have a material impact on our financial position, results of operations or liquidity.

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Accrued Warranty

12 Months Ended

Dec. 29, 2018

Product Warranties Disclosures [Abstract]

Accrued Warranty

Accrued Warranty

The Company warrants its products against defect for 12 months, however, for certain products a customer may purchase an extended warranty. A provision for estimated future costs and estimated returns for credit relating to such warranty is recorded in the period when product is shipped and revenue recognized, and is updated as additional information becomes available. The Company’s estimate of future costs to satisfy warranty obligations is based primarily on historical warranty expense experienced and a provision for potential future product failures. Changes in the accrued warranty for fiscal years ended 2018, 2017 and 2016 are as follows:

	Fiscal Year Ended
	December 29, 2018			December 30, 2017			December 31, 2016
Beginning balance	$	649,000		$	518,000		$	518,000
Additions	159,000			328,000			440,000
Claim and reversals	(237,000		)	(197,000		)	(440,000		)
Ending Balance	$	571,000		$	649,000		$	518,000

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Financial Instruments

12 Months Ended

Dec. 29, 2018

Financial Instruments [Abstract]

Financial Instruments

Financial Instruments

Fair Value Measurements

Financial instruments are categorized as Level 1, Level 2 or Level 3 based upon the method by which their fair value is computed. An investment is categorized as Level 1 when its fair value is based on unadjusted quoted prices in active markets for identical assets that the Company has the ability to access at the measurement date. An investment is categorized as Level 2 if its fair market value is based on quoted market prices for similar assets in active markets, quoted prices for identical or similar assets in markets that are not active, based on observable inputs such as interest rates, yield curves, or derived from or corroborated by observable market data by correlation or other means. An investment is categorized as Level 3 if its fair value is based on assumptions developed by the Company about what a market participant would use in pricing the assets.

The following table details the fair value measurements of the Company’s financial assets:

			Fair Value Measurement at December 29, 2018 Using:
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	14,326,347	$	14,326,347	$	—	$	—
U.S. government and agency backed securities	12,810,923		—		12,810,923		—
Corporate debt	10,107,093		—		10,107,093		—
GCS Holdings	288,026		288,026		—		—
Equity Investments	5,565,499		—		—		5,565,499
	$	43,097,888	$	14,614,373	$	22,918,016	$	5,565,499

			Fair Value Measurement at December 30, 2017 Using:
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	24,848,227	$	24,848,227	$	—	$	—
U.S. government and agency backed securities	34,725,811		6,927,323		27,798,488		—
Corporate debt	8,980,906		—		8,980,906		—
Certificates of deposit	200,740		—		200,740		—
GCS Holdings	478,546		478,546		—		—
Warrant	2,000,000		—		—		2,000,000
	$	71,234,230	$	32,254,096	$	36,980,134	$	2,000,000

Transfers between levels of the fair value hierarchy are reported at the beginning of the reporting period in which they occur. The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of their short-term nature. If accrued liabilities were carried at fair value, these would be classified as Level 2 in the fair value hierarchy.

Changes in Level 3 investments are as follows:

	December 30, 2017		Net unrealized gains/(losses)			Purchases, issuances and settlements			Transfers in and or out of Level 3		December 29, 2018
Equity Investments	$	—	$	(284,317	)	$	5,849,816		$	—	$	5,565,499
Warrant	2,000,000		(50,184		)	(1,949,816		)	—		—
	$	2,000,000	$	(334,501	)	$	3,900,000		$	—	$	5,565,499

Equity Investments

Equity investments rarely traded or not quoted will generally have less (or no) pricing observability and a higher degree of judgment utilized in measuring fair value. Initial measurement of equity investments occurs when an observable price for the equity investment is available. The Company adopted ASU No. 2016-01 and the related amendments on December 31, 2017 (the first day of the Company's fiscal year 2018). This standard amends various aspects of the recognition, measurement, presentation, and disclosure of financial instruments. The Company adopted the measurement alternative for equity investments without readily determinable fair values (often referred to as cost method investments) on a prospective basis. As a result, these investments will be revalued upon occurrence of an observable price change for similar investments and for impairments.

Warrant

The Company had a warrant to acquire up to 15% of the next round of equity offered by a customer as part of the licensing of technology to the customer. The Company exercised the warrant in April 2018.

Marketable Debt Securities

The corporate debt consists of floating rate notes with a maturity that is over multiple years but has interest rates that are reset every three months based on the then-current three-month London Interbank Offering Rate ("three-month Libor"). The Company validates the fair market values of the financial instruments above by using discounted cash flow models, obtaining independent pricing of the securities or through the use of a model that incorporates the three-month Libor, the credit default swap rate of the issuer and the bid and ask price spread of the same or similar investments which are traded on several markets. Investments in available-for-sale marketable debt securities are as follows at December 29, 2018 and December 30, 2017: 

	Amortized Cost				Unrealized Losses						Fair Value
	2018		2017		2018			2017			2018		2017
U.S. government and agency backed securities	$	13,064,418	$	35,014,593	$	(253,495	)	$	(288,782	)	$	12,810,923	$	34,725,811
Corporate debt	10,175,084		8,988,608		(67,991		)	(7,702		)	10,107,093		8,980,906
Certificates of deposits	—		201,000		—			(260		)	—		200,740
Total	$	23,239,502	$	44,204,201	$	(321,486	)	$	(296,744	)	$	22,918,016	$	43,907,457

The contractual maturity of the Company’s marketable debt securities is as follows at December 29, 2018:

	Less than One year		One to Five years		Total
U.S. government and agency backed securities	$	3,741,183	$	9,069,740	$	12,810,923
Corporate debt	2,709,074		7,398,019		10,107,093
Total	$	6,450,257	$	16,467,759	$	22,918,016

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CONSOLIDATED STATEMENT OF OPERATIONS - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Revenues:
Total revenues	$ 24,465,005	$ 27,841,490	$ 22,642,566
Research and development and other revenues	5,253,890	2,946,685	1,527,441
Expenses:
Cost of product revenues	15,831,441	18,118,418	17,814,271
Research and development-funded programs	4,892,066	3,364,658	786,867
Research and development-internal	12,553,237	15,515,057	15,252,794
Selling, general and administrative	27,210,849	20,541,244	16,961,773
Impairment of goodwill	1,417,470	600,086	0
Impairment of assets	2,526,669
Gain on sale of property, plant and equipment		0	(7,700,522)
Total expenses	64,431,732	58,139,463	43,115,183
Loss from operations	(39,966,727)	(30,297,973)	(20,472,617)
Non-operating income (expense), net:
Interest income	640,059	775,626	658,384
Other income (expense), net	855,106	247,291	(448,581)
Foreign Currency Transaction Gain (Loss), Unrealized	1,169,254	(1,068,059)	(672,727)
Gain on investments	2,849,816	2,000,000	1,034,396
Impairment of equity and cost investments	(1,417,470)	(600,086)
Total other income and expense	5,514,235	1,954,858	571,472
Loss before benefit (provision) for income taxes and net loss (income) of noncontrolling interest	(34,452,492)	(28,343,115)	(19,901,145)
Income Tax Expense (Benefit)	(30,000)	2,963,000	(3,130,000)
Net loss	(34,482,492)	(25,380,115)	(23,031,145)
Net (income) loss attributable to the noncontrolling interest	(51,050)	139,633	(537,572)
Net loss attributable to Kopin Corporation	$ (34,533,542)	$ (25,240,482)	$ (23,568,717)
Net loss per share:
Basic and diluted (in dollars per share)	$ (0.47)	$ (0.36)	$ (0.37)
Weighted average number of common shares outstanding:
Basic and diluted (in shares)	73,156,545	69,914,956	64,045,675
Product [Member]
Revenues:
Total revenues	$ 19,211,115	$ 24,894,805	$ 21,115,125
Expenses:
Cost of product revenues	15,831,441
Non-operating income (expense), net:
Net loss attributable to Kopin Corporation	$ (34,533,542)

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Segments and Disaggregation of Revenue (Tables)

12 Months Ended

Dec. 29, 2018

Segment Reporting [Abstract]

Segments and Disaggregation of Revenue

Total Revenue (in thousands)	2018			2017			2016
Kopin	$	16,981		$	15,942		$	18,733
Industrial	9,116			13,585			3,909
Eliminations	(1,631		)	(1,685		)	—
Total	$	24,465		$	27,841		$	22,643
Total Intersegment Revenue (in thousands)	2018			2017			2016
Kopin	$	—		$	—		$	—
Industrial	1,631			1,685			—
Total	$	1,631		$	1,685		$	—
	2018			2017			2016
Net Loss Attributable to the Controlling Interest (in thousands)	(As Revised)1						(As Revised)1
Kopin	$	(33,768	)	$	(26,153	)	$	(22,757	)
Industrial	(766		)	1,277			(812		)
Eliminations	—			(364		)	—
Total	$	(34,534	)	$	(25,240	)	$	(23,569	)
Intersegment Loss Attributable to the Controlling Interest (in thousands)	2018			2017			2016
Kopin	$	—		$	—		$	—
Industrial	—			364			—
Total	$	—		$	364		$	—
Total Assets (in thousands)				2018			2017
Kopin				$	50,995		$	82,707
Industrial				8,554			8,615
Total				$	59,549		$	91,322

Long-lived Assets by Geographic Areas [Table Text Block]

Total long-live assets by country at December 29, 2018 and December 30, 2017 were:

Total Long-lived Assets (in thousands)	2018		2017
U.S.	$	2,101	$	2,456
United Kingdom	197		192
China	251		338
Japan	50		206
Korea	—		1,885
Total	$	2,599	$	5,077

Disaggregation of Revenue

for the fiscal years ended December 29, 2018, December 30, 2017 and December 31, 2016 was as follows:

	2018
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	10,799	44	%	$	3,637	15	%	$	14,436	59	%
Other Americas	49		—		74		—		123		1
Total Americas	10,848		44		3,712		15		14,559		60
Asia-Pacific	4,932		20		1,984		8		6,916		28
Europe	1,194		5		1,754		7		2,948		12
Other	7		—		35		—		42		—
Total Revenues	$	16,981	69	%	$	7,484	30	%	$	24,465	100	%
	2017
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	10,056	36	%	$	6,484	23	%	$	16,540	59	%
Other Americas	24		—		62		—		86		—
Total Americas	10,080		36		6,545		24		16,626		60
Asia-Pacific	4,006		14		1,401		5		5,406		19
Europe	1,856		7		3,954		14		5,810		21
Total Revenues	$	15,942	57	%	$	11,900	43	%	$	27,841	100	%
	2016
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	8,847	39	%	$	390	2	%	$	9,237	41	%
Other Americas	41		—		—		—		41		—
Total Americas	8,887		39		390		2		9,278		41
Asia-Pacific	7,588		33		2,260		10		9,849		43
Europe	2,258		10		1,258		6		3,516		16
Total Revenues	$	18,733	82	%	$	3,909	18	%	$	22,643	100	%

Total revenue by display application for the fiscal years ended December 29, 2018, December 30, 2017 and December 31, 2016 was as follows:

	2018
(In thousands)	Kopin		Industrial		Total
Military	$	4,755	$	3,969	$	8,724
Industrial	2,969		3,096		6,066
Consumer	4,146		—		4,146
R&D	5,035		219		5,254
Other	75		200		275
Total Revenues	$	16,981	$	7,484	$	24,465
	2017
(In thousands)	Kopin		Industrial		Total
Military	$	4,400	$	9,038	$	13,438
Industrial	2,695		2,783		5,478
Consumer	4,406		—		4,406
R&D	2,938		9		2,947
Other	1,503		69		1,573
Total Revenues	$	15,942	$	11,900	$	27,841
	2016
(In thousands)	Kopin		Industrial		Total
Military	$	4,963	$	375	$	5,338
Industrial	3,128		3,168		6,296
Consumer	7,418		—		7,418
R&D	1,527		—		1,527
Other	1,697		367		2,064
Total Revenues	$	18,733	$	3,909	$	22,643

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Business Combinations (Tables)

12 Months Ended

Dec. 29, 2018

Dec. 30, 2017

Business Combinations [Abstract]

Business Acquisition, Pro Forma Information [Table Text Block]

The following unaudited supplemental pro forma disclosures are provided for the fiscal year ended December 30, 2017. All intercompany transactions have been eliminated.

Fiscal year ended	2017			2016
Revenues	$	28,477,870		$	25,029,681
Net loss	(26,302,840		)	(23,736,518		)
Basic and diluted earnings per share	$	(0.38	)	$	(0.37	)

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

The identifiable assets acquired and liabilities assumed at the acquisition date have been recognized at fair value. The allocation of the purchase price as of the acquisition date is as follows:

Cash and marketable securities	$	2,600
Accounts receivable	490,700
Inventory	768,400
Other identifiable assets	46,800
Order backlog	840,000
Customer relationships	1,000,000
Developed technology	460,000
Trademark portfolio	160,000
Current liabilities	(480,500		)
Net deferred tax liabilities	(1,084,000		)
Goodwill	1,489,000
Total	$	3,693,000

Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block]

The identified intangible assets are being amortized on a straight-line basis over the following lives, in years:

Order backlog	1
Customer relationships	2
Developed technology	2
Trademark portfolio	2

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Concentrations of Risk (Tables)

12 Months Ended

Dec. 29, 2018

Risks and Uncertainties [Abstract]

Schedules of Concentration of Risk, by Risk Factor

Ongoing credit evaluations of customers’ financial condition are performed and collateral, such as letters of credit, are generally not required. Customer’s accounts receivable balance as a percentage of total accounts receivable was as follows:

	Percent of Gross Accounts Receivable
Customer	December 29, 2018	December 30, 2017
Collins Aerospace	11%	*
DRS Technologies	11%	*
Scott Safety	*	14%
RealWear, Inc.	31%	10%
U.S. Army	*	43%

Note: The symbol “*” indicates that accounts receivables from that customer were less than 10% of the Company’s total accounts receivable.

Sales to significant non-affiliated customers for fiscal years 2018, 2017 and 2016, as a percentage of total revenues, is as follows:

	Sales as a Percent of Total Revenue
	Fiscal Year
Customer	2018	2017	2016
Military Customers in Total	36%	48%	24%
General Dynamics	11%	*	*
DRS Technologies	*	10%	*
Collins Aerospace	20%	10%	12%
Shenzhen Oriscape	*	*	20%
U.S. Army	*	12%	*
Funded Research and Development Contracts	20%	11%	7%

Note: The symbol “*” indicates that sales to that customer were less than 10% of the Company’s total revenues. The caption "Military Customers in Total" excludes research and development contracts.

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Restatement of Previously Issued Financial Statements (Notes)

12 Months Ended

Dec. 29, 2018

Restatement of Previously Issued Financial Statements [Abstract]

Accounting Changes and Error Corrections [Text Block]

18.    Correction of Previously Issued Financial Statements

Subsequent to filing its Original Form 10-K, the Company identified that its consolidated financial statements were incorrect because of certain errors impacting noncontrolling interest in connection with its Korean subsidiary Kowon. Accordingly, the accompanying consolidated financial statements as of December 29, 2018 and for the three years in the period ended December 29, 2018, have been revised to correct these errors. A summary of these errors and their impact on the consolidated financial statements are as follows:

1. The Company improperly calculated the noncontrolling interest amount of Kowon when the Company made equity investments in years prior to 2015. The Company has corrected for this misstatement in the accompanying Consolidated Statements of Stockholders’ Equity, which resulted in a decrease to additional paid-in capital and an increase to noncontrolling interest of $1.2 million as of December 26, 2015. This correction impacted the respective equity categories in the accompanying Consolidated Statements of Stockholders’ Equity and Consolidated Balance Sheets for 2016, 2017 and 2018.

2. In 2016, upon recognition of a gain on sale of Kowon assets, the Company did not properly allocate the portion of the gain attributable to the noncontrolling interest in the amount of $0.1 million. The Company has corrected for this misstatement in the accompanying 2016 Consolidated Statement of Operations, which consequently impacts the accompanying Consolidated Statements of Stockholders’ Equity by increasing accumulated deficit and increasing noncontrolling interest for $0.1 million as of December 31, 2016.

3. In 2018, when the Company liquidated Kowon, it was carrying approximately $1.7 million in cumulative translation adjustments ("CTA") related to Kowon's net assets. Approximately $0.4 million of CTA was correctly reclassified into earnings in 2018, however, the remaining $1.3 million was incorrectly reclassified directly to noncontrolling interest to offset cumulative understatement in noncontrolling interest that resulted from the two prior period errors noted above. This caused the net loss in the accompanying 2018 Consolidated Statement of Operations to be overstated by $1.3 million, which the Company has corrected in the accompanying Consolidated Statements of Operations.

4.

In addition, in connection with the liquidation of Kowon, the Company understated its distribution to the noncontrolling interest holder in the accompanying 2018 Consolidated Statement of Cash Flows by less than $0.1 million, which the Company has corrected in the accompanying Consolidated Statements of Cash Flows.

The effects of these adjustments on the consolidated statements of stockholders’ equity are as follows:

	Addition Paid-in Capital				Accumulated Deficit						Noncontrolling Interest
	As Previously Reported	Adjustment		As Revised	As Previously Reported		Adjustment		As Revised		As Previously Reported		Adjustment		As Revised
Balance at December 26, 2015	326,558,527	(1,201,482	)	325,357,045	(190,608,671	)	—		(190,608,671	)	(256,096	)	1,201,482		945,386
Net (loss) income	—	—		—	(23,434,116	)	(134,601	)	(23,568,717	)	402,971		134,601		537,572
Balance at December 31, 2016	328,524,644	(1,201,482	)	327,323,162	(214,042,787	)	(134,601	)	(214,177,388	)	141,957		1,336,083		1,478,040
Balance at December 30, 2017	331,119,340	(1,201,482	)	329,917,858	(240,121,901	)	(134,601	)	(240,256,502	)	(719,422	)	1,336,083		616,661
Distribution to noncontrolling interest holder	—	—		—	—		—		—		636,978		(1,336,083	)	(699,105	)
Net (loss) income	—	—		—	(35,869,625	)	1,336,083		(34,533,542	)	51,050		—		51,050
Balance at December 29, 2018	335,692,879	(1,201,482	)	334,491,397	(272,932,143	)	1,201,482		(271,730,661	)	(149,053	)	—		(149,053	)

The effects of these adjustments on the consolidated statements of operations are as follows:

	As Previously Reported			Adjustment			As Revised
2018
Foreign currency transaction gains (losses)	$	(166,829	)	$	1,336,083		$	1,169,254
2016
Net income attributable to noncontrolling interest	402,971			134,601			537,572
Net loss attributable to Kopin Corporation	$	(23,434,116	)	$	(134,601	)	$	(23,568,717	)

The effects of these adjustments on the consolidated statements of cash flows are as follows:

	As Previously Reported			Adjustment			As Revised
2018
Cash flows from operating activities:
Net loss	$	(35,818,575	)	$	1,336,083		$	(34,482,492	)
Foreign currency (gains) losses	177,469			(1,273,956		)	(1,096,487		)
Cash flows from financing activities
Distribution to noncontrolling interest holder	$	(636,978	)	$	(62,127	)	$	(699,105	)

The above referenced adjustments do not impact the consolidated statement of operations for the fiscal year ended December 30, 2017 or the consolidated statements of cash flows for the fiscal years ended December 30, 2017 and December 31, 2016.

Although the Company does not believe such misstatements are material to the previously issued consolidated financial statements, for comparability purposes, the Company has revised the previously issued consolidated financial statements to correct the misstatements.

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Segments and Disaggregation of Revenue

12 Months Ended

Dec. 29, 2018

Segment Reporting [Abstract]

Segments and Disaggregation of Revenue

Segments and Disaggregation of Revenue (As Revised)

The Company’s chief operating decision maker is its Chief Executive Officer. The Company has determined it has two reportable segments, Industrial, which includes the operations that develop and manufacture its reflective display products and virtual reality systems for test and simulation products, and Kopin, which includes the operations that develop and manufacture its other products.

As noted in Note 1. Summary of Significant Accounting Policies, effective December 31, 2017, the Company adopted Topic 606 using the modified retrospective method. The comparative information has not been revised and continues to be reported under the accounting standards in effect for those periods.

Segment financial results were as follows:

Total Revenue (in thousands)	2018			2017			2016
Kopin	$	16,981		$	15,942		$	18,733
Industrial	9,116			13,585			3,909
Eliminations	(1,631		)	(1,685		)	—
Total	$	24,465		$	27,841		$	22,643
Total Intersegment Revenue (in thousands)	2018			2017			2016
Kopin	$	—		$	—		$	—
Industrial	1,631			1,685			—
Total	$	1,631		$	1,685		$	—
	2018			2017			2016
Net Loss Attributable to the Controlling Interest (in thousands)	(As Revised)1						(As Revised)1
Kopin	$	(33,768	)	$	(26,153	)	$	(22,757	)
Industrial	(766		)	1,277			(812		)
Eliminations	—			(364		)	—
Total	$	(34,534	)	$	(25,240	)	$	(23,569	)
Intersegment Loss Attributable to the Controlling Interest (in thousands)	2018			2017			2016
Kopin	$	—		$	—		$	—
Industrial	—			364			—
Total	$	—		$	364		$	—
Total Assets (in thousands)				2018			2017
Kopin				$	50,995		$	82,707
Industrial				8,554			8,615
Total				$	59,549		$	91,322

1. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements

Total long-live assets by country at December 29, 2018 and December 30, 2017 were:

Total Long-lived Assets (in thousands)	2018		2017
U.S.	$	2,101	$	2,456
United Kingdom	197		192
China	251		338
Japan	50		206
Korea	—		1,885
Total	$	2,599	$	5,077

We disaggregate our revenue from contracts with customers by geographic location and by display application, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

Total revenue by geographical area for the fiscal years ended December 29, 2018, December 30, 2017 and December 31, 2016 was as follows:

	2018
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	10,799	44	%	$	3,637	15	%	$	14,436	59	%
Other Americas	49		—		74		—		123		1
Total Americas	10,848		44		3,712		15		14,559		60
Asia-Pacific	4,932		20		1,984		8		6,916		28
Europe	1,194		5		1,754		7		2,948		12
Other	7		—		35		—		42		—
Total Revenues	$	16,981	69	%	$	7,484	30	%	$	24,465	100	%
	2017
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	10,056	36	%	$	6,484	23	%	$	16,540	59	%
Other Americas	24		—		62		—		86		—
Total Americas	10,080		36		6,545		24		16,626		60
Asia-Pacific	4,006		14		1,401		5		5,406		19
Europe	1,856		7		3,954		14		5,810		21
Total Revenues	$	15,942	57	%	$	11,900	43	%	$	27,841	100	%
	2016
	Kopin				Industrial				Total
(In thousands, except percentages)	Revenue		% of Total		Revenue		% of Total		Revenue		% of Total
U.S.	$	8,847	39	%	$	390	2	%	$	9,237	41	%
Other Americas	41		—		—		—		41		—
Total Americas	8,887		39		390		2		9,278		41
Asia-Pacific	7,588		33		2,260		10		9,849		43
Europe	2,258		10		1,258		6		3,516		16
Total Revenues	$	18,733	82	%	$	3,909	18	%	$	22,643	100	%

Total revenue by display application for the fiscal years ended December 29, 2018, December 30, 2017 and December 31, 2016 was as follows:

	2018
(In thousands)	Kopin		Industrial		Total
Military	$	4,755	$	3,969	$	8,724
Industrial	2,969		3,096		6,066
Consumer	4,146		—		4,146
R&D	5,035		219		5,254
Other	75		200		275
Total Revenues	$	16,981	$	7,484	$	24,465
	2017
(In thousands)	Kopin		Industrial		Total
Military	$	4,400	$	9,038	$	13,438
Industrial	2,695		2,783		5,478
Consumer	4,406		—		4,406
R&D	2,938		9		2,947
Other	1,503		69		1,573
Total Revenues	$	15,942	$	11,900	$	27,841
	2016
(In thousands)	Kopin		Industrial		Total
Military	$	4,963	$	375	$	5,338
Industrial	3,128		3,168		6,296
Consumer	7,418		—		7,418
R&D	1,527		—		1,527
Other	1,697		367		2,064
Total Revenues	$	18,733	$	3,909	$	22,643

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Contract Assets and Liabilities (Tables)

12 Months Ended

Dec. 29, 2018

Contract Assets and Liabilities [Abstract]

Contract with Customer, Asset and Liability [Table Text Block]

Net contract assets (liabilities) consisted of the following:

	December 29, 2018			December 31, 2017			$ Change			% Change
Contract assets and unbilled receivables	$	3,089,663		$	3,555,137		$	(465,474	)	(13	)%
Contract liabilities and billings in excess of revenue earned	(388,933		)	(664,146		)	275,213			(41	)%
Contract liabilities, noncurrent	(17,294		)	(374,171		)	356,877			(95	)%
Net contract assets	$	2,683,436		$	2,516,820		$	166,616		7	%

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Goodwill and Intangibles (Details) - USD ($)		12 Months Ended
	Mar. 07, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Goodwill [Roll Forward]
Beginning Balance		$ 1,780,247	$ 844,023
Goodwill, Acquired During Period	$ 1,488,650
Goodwill, Impairment Loss		(1,417,470)	(600,086)	$ 0
Goodwill, Translation and Purchase Accounting Adjustments		(31,433)	47,660
Ending Balance		331,344	1,780,247	844,023
Amortization of Intangible Assets		900,000	1,600,000	0.0
Intangible Assets, Gross (Excluding Goodwill)		2,500,000
Finite-Lived Intangible Assets, Accumulated Amortization		2,500,000
Kopin [Member]
Goodwill [Roll Forward]
Beginning Balance		891,683	844,023
Goodwill, Translation and Purchase Accounting Adjustments		(31,433)	47,660
Ending Balance		331,344	891,683	844,023
Kopin [Member] | Kopin Software Limited [Member]
Goodwill [Roll Forward]
Goodwill, Impairment Loss		(528,906)
Industrial [Member]
Goodwill [Roll Forward]
Beginning Balance		888,564	0
Goodwill, Acquired During Period	$ 1,488,650
Goodwill, Translation and Purchase Accounting Adjustments		0
Ending Balance		0	888,564	$ 0
Industrial [Member] | NVIS, Inc. [Member]
Goodwill [Roll Forward]
Goodwill, Impairment Loss		$ (888,564)	$ (600,086)

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Related Party Transactions (Tables)

12 Months Ended

Dec. 29, 2018

Related Party Transactions [Abstract]

Schedule of Related Party Transactions [Table Text Block]

During fiscal years 2018, 2017 and 2016, the Company had the following transactions with related parties:

	2018				2017				2016
	Revenue		Purchases		Revenue		Purchases		Revenue		Purchases
Goertek	$	—	$	646,135	$	—	$	727,101	$	—	$	—
RealWear, Inc.	1,220,838		—		576,644		—		—		—
	$	1,220,838	$	646,135	$	576,644	$	727,101	$	—	$	—

At December 29, 2018 and December 30, 2017, the Company had the following receivables and payables with related parties:

	December 29, 2018						December 30, 2017
	Receivables		Contract Assets		Payables		Receivables		Payables
Goertek	$	—	$	—	$	207,530	$	—	$	326,877
RealWear, Inc.	1,041,334		400,000		—		414,635		—
	$	1,041,334	$	400,000	$	207,530	$	414,635	$	326,877

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Summary of Significant Accounting Policies Components of Accumulated Other Comprehensive Income (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	$ 3,564,779	$ 1,570,971	$ 771,774
Changes during year	(2,010,192)	1,993,808	799,197
Ending balance	1,554,587	3,564,779	1,570,971
Reclassifications of gain (loss) in net loss
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	(54,660)	(48,284)	0
Changes during year, reclassifications	49,525	(6,376)	(48,284)
Ending balance	(5,135)	(54,660)	(48,284)
Cumulative Translation Adjustment
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	3,231,706	1,380,042	566,025
Changes during year, before reclassifications	(1,794,768)	1,851,664	814,017
Ending balance	1,436,938	3,231,706	1,380,042
Unrealized holding (loss) gain on marketable securities
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	387,733	239,213	205,749
Changes during year, before reclassifications	(264,949)	148,520	33,464
Ending balance	$ 122,784	$ 387,733	$ 239,213

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Restatement of Previously Issued Financial Statements Restatement of Statement of Operations (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 29, 2018	Sep. 29, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Foreign Currency Transaction Gain (Loss), Unrealized									$ 1,169,254	$ (1,068,059)	$ (672,727)
Net Income (Loss) Attributable to Noncontrolling Interest									51,050	(139,633)	537,572
Net Income (Loss) Attributable to Parent	$ (9,966,000)	$ (9,791,000)	$ (9,241,000)	$ (5,536,000)	$ (1,803,000)	$ (8,247,000)	$ (7,332,000)	$ (7,858,000)	(34,533,542)	$ (25,240,482)	(23,568,717)
Previously Reported [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Foreign Currency Transaction Gain (Loss), Unrealized									(166,829)
Net Income (Loss) Attributable to Noncontrolling Interest									51,050		402,971
Net Income (Loss) Attributable to Parent									(35,869,625)		(23,434,116)
Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Foreign Currency Transaction Gain (Loss), Unrealized									1,336,083
Net Income (Loss) Attributable to Noncontrolling Interest											134,601
Net Income (Loss) Attributable to Parent									1,336,083		$ (134,601)
As Revised [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Foreign Currency Transaction Gain (Loss), Unrealized									$ 1,169,254

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Related Party Transactions (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Related Party Transaction [Line Items]
Related Party Transaction, Purchases from Related Party		$ 646,135	$ 727,101	$ 0
Accounts Receivable, Related Parties		1,041,334	414,635
Accounts Payable, Related Parties		207,530	326,877
Contract with Related Party, Asset, Net		400,000
Revenue from Related Parties		1,220,838	576,644	0
RealWear, Inc. [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Purchases from Related Party		0	0	0
Accounts Receivable, Related Parties		1,041,334	414,635
Contract with Related Party, Asset, Net		400,000
Revenue from Related Parties		1,220,838	576,644	0
Ownership Percentage in Equity Investment, Warrant	15.00%
RealWear, Inc. [Member] | Nonsoftware License Arrangement [Member]
Related Party Transaction [Line Items]
Revenue from Related Parties	$ 1,500,000
Goertek [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Purchases from Related Party		646,135	727,101	0
Accounts Payable, Related Parties		207,530	326,877
Revenue from Related Parties		$ 0	$ 0	$ 0

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Property, Plant and Equipment (Tables)

12 Months Ended

Dec. 29, 2018

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, plant and equipment consisted of the following at December 29, 2018 and December 30, 2017:

	Useful Life	2018			2017
Equipment	3-5 years	$	16,824,384		$	16,811,526
Leasehold improvements	Life of the lease	3,676,775			3,851,269
Furniture and fixtures	3 years	523,736			531,870
Equipment under construction		436,806			2,415,957
		21,461,701			23,610,622
Accumulated depreciation and amortization		(18,862,859		)	(18,533,579		)
Property, plant and equipment, net		$	2,598,842		$	5,077,043

XML

Valuation and Qualifying Accounts (Notes)

12 Months Ended

Dec. 29, 2018

SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]

SEC Schedule, 12-09, Schedule of Valuation and Qualifying Accounts Disclosure [Text Block]

17.    Valuation and Qualifying Accounts

The following table sets forth activity in Kopin's allowance for doubtful accounts:

Fiscal year ended:	Balance at Beginning of Year		Additions Charged to Income		Deductions from Reserve			Balance at End of Year
December 31, 2016	$	153,000	$	—	$	(17,000	)	$	136,000
December 30, 2017	136,000		13,000		—			149,000
December 29, 2018	$	149,000	$	268,000	$	(113,000	)	$	304,000

XML

Litigation

12 Months Ended

Dec. 29, 2018

Commitments and Contingencies Disclosure [Abstract]

Litigation

Litigation

The Company may engage in legal proceedings arising in the ordinary course of business. Claims, suits, investigations and proceedings are inherently uncertain and it is not possible to predict the ultimate outcome of such matters and our business, financial condition, results of operations or cash flows could be affected in any particular period.

BlueRadios, Inc. v. Kopin Corporation, Civil Action No. 16-02052-JLK (D. Col.):

On August 12, 2016, BlueRadios, Inc. ("BlueRadios") filed a complaint in the U.S. District Court for the District of Colorado, alleging that the Company breached a contract between it and BlueRadios concerning a joint venture between the Company and BlueRadios to design, develop and commercialize microdisplay products with embedded wireless technology referred to as “Golden-i”. Additionally BlueRadios alleged that the Company breached the covenant of good faith and fair dealing associated with that contract, breached its fiduciary duty to BlueRadios, and misappropriated trade secrets owned by BlueRadios in violation of Colorado law (C.R.S. § 7-74-104(4)) and the Defend Trade Secrets Act (18 U.S.C. § 1836(b)(1)). BlueRadios further alleges that the Company was unjustly enriched by its alleged misconduct, BlueRadios is entitled to an accounting to determine the amount of profits obtained by the Company as a result of its alleged misconduct, and the inventorship on at least ten patents or patent applications owned by the Company need to be corrected to list BlueRadios’ employees as inventors and thereby list BlueRadios as co-assignees of the patents. BlueRadios seeks monetary, declaratory, and injunctive relief.

On October 11, 2016, the Company filed its Answer and Affirmative Defenses. The parties are in the midst of discovery, with the close of all discovery currently set for June 14, 2019, or 120 days after a claim construction order should one be necessary. A trial date has not yet been set by the Court. The Company has not concluded a loss from this matter is probable; therefore, we have not recorded an accrual for litigation or claims related to this matter for the period ended December 29, 2018. The Company will continue to evaluate information as it becomes known and will record an estimate for losses at the time or times when it is both probable that a loss has been incurred and the amount of the loss is reasonably estimable.

XML

Valuation and Qualifying Accounts (Tables)

12 Months Ended

Dec. 29, 2018

SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]

Valuation and Qualifying Accounts [Table Text Block]

The following table sets forth activity in Kopin's allowance for doubtful accounts:

Fiscal year ended:	Balance at Beginning of Year		Additions Charged to Income		Deductions from Reserve			Balance at End of Year
December 31, 2016	$	153,000	$	—	$	(17,000	)	$	136,000
December 30, 2017	136,000		13,000		—			149,000
December 29, 2018	$	149,000	$	268,000	$	(113,000	)	$	304,000

XML

Property, Plant and Equipment (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Property, Plant and Equipment [Line Items]
Proceeds from Sale of Property, Plant, and Equipment	$ 0	$ 0	$ 8,106,819
Gain (Loss) on Disposition of Property Plant Equipment		0	7,700,522
Excess Stock, Shares Authorized	14,100,000
Gross property, plant and equipment	$ 21,461,701	23,610,622
Accumulated depreciation and amortization	(18,862,859)	(18,533,579)
Net property, plant and equipment	2,598,842	5,077,043
Depreciation expense	1,000,000.0	900,000	$ 1,000,000
Impairment of assets	$ 2,526,669
Minimum
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Maximum
Property, Plant and Equipment [Line Items]
Useful Life	10 years
Equipment
Property, Plant and Equipment [Line Items]
Gross property, plant and equipment	$ 16,824,384	16,811,526
Equipment | Minimum
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Equipment | Maximum
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Leasehold improvements
Property, Plant and Equipment [Line Items]
Gross property, plant and equipment	$ 3,676,775	3,851,269
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Gross property, plant and equipment	$ 523,736	531,870
Furniture and fixtures | Maximum
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Equipment under construction
Property, Plant and Equipment [Line Items]
Gross property, plant and equipment	$ 436,806	$ 2,415,957

XML

Financial Instruments (Fair Value Measurements) (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	$ 43,097,888	$ 71,234,230
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	14,614,373	32,254,096
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	22,918,016	36,980,134
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value, Assets Measured on Recurring Basis, Change in Unrealized Gain (Loss)	(334,501)
Fair value measurements of financial assets	5,565,499	2,000,000
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases, (Sales), Issuances, (Settlements)	3,900,000
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3	0
Cash and Cash Equivalents [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	14,326,347	24,848,227
Cash and Cash Equivalents [Member] | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	14,326,347	24,848,227
Cash and Cash Equivalents [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	0	0
Warrant [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets		2,000,000
Warrant [Member] | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets		0
Warrant [Member] | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets		0
Warrant [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets		2,000,000
Equity Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	5,565,499
Equity Securities [Member] | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	0
Equity Securities [Member] | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	0
Equity Securities [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	5,565,499
US Government Agencies Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	12,810,923	34,725,811
US Government Agencies Debt Securities [Member] | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	0	6,927,323
US Government Agencies Debt Securities [Member] | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	12,810,923	27,798,488
US Government Agencies Debt Securities [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	0	0
Corporate Debt Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	10,107,093	8,980,906
Corporate Debt Securities [Member] | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	10,107,093	8,980,906
Corporate Debt Securities [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	0	0
Certificates of Deposit [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets		200,740
Certificates of Deposit [Member] | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets		200,740
Certificates of Deposit [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets		0
GCS Holdings [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	288,026	478,546
GCS Holdings [Member] | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	288,026	478,546
GCS Holdings [Member] | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	0	0
GCS Holdings [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements of financial assets	0	0
Equity Securities [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value, Assets Measured on Recurring Basis, Change in Unrealized Gain (Loss)	(284,317)
Fair value measurements of financial assets	5,565,499
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases, (Sales), Issuances, (Settlements)	5,849,816
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3	0
Warrant [Member] | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value, Assets Measured on Recurring Basis, Change in Unrealized Gain (Loss)	(50,184)
Fair value measurements of financial assets	0	$ 2,000,000
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases, (Sales), Issuances, (Settlements)	(1,949,816)
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3	$ 0

XML

Restatement of Previously Issued Financial Statements Restatement of Stockholders' Equity (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 29, 2018	Sep. 29, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016	Dec. 26, 2015
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ 47,712,821				$ 77,379,847				$ 47,712,821	$ 77,379,847	$ 74,219,643	$ 94,484,780
Net Income (Loss) Attributable to Parent	(9,966,000)	$ (9,791,000)	$ (9,241,000)	$ (5,536,000)	(1,803,000)	$ (8,247,000)	$ (7,332,000)	$ (7,858,000)	(34,533,542)	(25,240,482)	(23,568,717)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders									(699,105)	(791,737)
Net Income (Loss) Attributable to Noncontrolling Interest									51,050	(139,633)	537,572
Additional Paid-in Capital
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	334,491,397				329,917,858				334,491,397	329,917,858	327,323,162	325,357,045
Noncontrolling Interest
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(149,053)				616,661				(149,053)	616,661	1,478,040	945,386
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders									(699,105)	(791,737)
Accumulated Deficit
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(271,730,661)				(240,256,502)				(271,730,661)	(240,256,502)	(214,177,388)	(190,608,671)
Previously Reported [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Net Income (Loss) Attributable to Parent									(35,869,625)		(23,434,116)
Net Income (Loss) Attributable to Noncontrolling Interest									51,050		402,971
Previously Reported [Member] | Additional Paid-in Capital
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	335,692,879				331,119,340				335,692,879	331,119,340	328,524,644	326,558,527
Previously Reported [Member] | Noncontrolling Interest
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(149,053)				(719,422)				(149,053)	(719,422)	141,957	(256,096)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders									(636,978)
Previously Reported [Member] | Accumulated Deficit
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(272,932,143)				(240,121,901)				(272,932,143)	(240,121,901)	(214,042,787)	(190,608,671)
Restatement Adjustment [Member]
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Net Income (Loss) Attributable to Parent									1,336,083		(134,601)
Net Income (Loss) Attributable to Noncontrolling Interest											134,601
Restatement Adjustment [Member] | Additional Paid-in Capital
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	(1,201,482)				(1,201,482)				(1,201,482)	(1,201,482)	(1,201,482)	(1,201,482)
Restatement Adjustment [Member] | Noncontrolling Interest
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest					1,336,083					1,336,083	1,336,083	1,201,482
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders									1,336,083
Restatement Adjustment [Member] | Accumulated Deficit
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	1,201,482				(134,601)				1,201,482	(134,601)
As Revised [Member] | Additional Paid-in Capital
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ 334,491,397				$ 329,917,858				$ 334,491,397	$ 329,917,858	$ 327,323,162	$ 325,357,045

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Selected Quarterly Financial Information (Unaudited) (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 29, 2018	Sep. 29, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 30, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Quarterly Financial Information Disclosure [Line Items]
Revenues	$ 7,741,000	$ 5,126,000	$ 5,944,000	$ 5,654,000	$ 11,397,000	$ 6,139,000	$ 5,927,000	$ 4,378,000	$ 24,465,005	$ 27,841,490	$ 22,642,566
Gross Profit	1,439,000	(16,000)	974,000	983,000	3,654,000	1,444,000	862,000	816,000
(Loss) income from continuing operations	(10,884,000)	(10,299,000)	(8,992,000)	(9,792,000)	(4,962,000)	(8,605,000)	(8,068,000)	(8,663,000)
Net income (loss) attributable to the controlling interest	$ (9,966,000)	$ (9,791,000)	$ (9,241,000)	$ (5,536,000)	$ (1,803,000)	$ (8,247,000)	$ (7,332,000)	$ (7,858,000)	$ (34,533,542)	$ (25,240,482)	$ (23,568,717)
Net loss per share:
Basic and Diluted (in dollars per share)	$ (0.14)	$ (0.13)	$ (0.13)	$ (0.08)	$ (0.02)	$ (0.11)	$ (0.10)	$ (0.12)	$ (0.47)	$ (0.36)	$ (0.37)
Shares used in computing net income per share:
Basic and diluted (in shares)	73,317,000	73,135,000	73,095,000	73,078,000	72,349,000	72,188,000	70,627,000	64,539,000	73,156,545	69,914,956	64,045,675
Gain on investments					$ 1,700,000

XML

Employee Benefit Plan (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Schedule of Benefit Plans Disclosure [Line Items]
Defined Contribution Plan, Employee Age Threshhold for Higher Annual Contribution	50 years
Employer matching percentage	50.00%
Maximum amount of employee contribution that employer matches	6.00%
Amount charged to operations in connection with the plan	$ 300,000	$ 300,000	$ 300,000
Under the age of 50
Schedule of Benefit Plans Disclosure [Line Items]
Maximum amount of annual compensation that can be deferred	18,500
Over the age fo 50
Schedule of Benefit Plans Disclosure [Line Items]
Maximum amount of annual compensation that can be deferred	$ 24,500

XML

Stockholders' Equity and Stock-Based Compensation (Stock-Based Compensation) (Details) - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation	$ 4,791,054	$ 2,296,131	$ 2,425,326
Cost of product revenues
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation	418,605	490,481	561,791
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation	725,112	799,485	527,081
Selling, general and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation	$ 3,647,337	$ 1,006,165	$ 1,336,454

XML

Financial Instruments (Marketable Debt Securities) (Details) - USD ($)	Dec. 29, 2018	Dec. 30, 2017
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 23,239,502	$ 44,204,201
Unrealized Losses	(321,486)	(296,744)
Fair Value	22,918,016	43,907,457
US Government Agencies Debt Securities [Member]
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	13,064,418	35,014,593
Unrealized Losses	(253,495)	(288,782)
Fair Value	12,810,923	34,725,811
Corporate Debt Securities [Member]
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	10,175,084	8,988,608
Unrealized Losses	(67,991)	(7,702)
Fair Value	10,107,093	8,980,906
Certificates of Deposit [Member]
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	0	201,000
Unrealized Losses	0	(260)
Fair Value	$ 0	$ 200,740

XML

Income Taxes

12 Months Ended

Dec. 29, 2018

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The (benefit) provision for income taxes from continuing operations consists of the following for the fiscal years indicated: 

	Fiscal Year
	2018			2017			2016
Current
State	$	5,000		$	5,000		$	33,000
Foreign	25,000			(568,000		)	1,656,000
Total current provision	30,000			(563,000		)	1,689,000
Deferred
Federal	(7,307,000		)	15,461,000			(8,718,000		)
State	(360,000		)	(493,000		)	(1,264,000		)
Foreign	300,000			(187,000		)	2,308,000
Change in valuation allowance	7,367,000			(17,181,000		)	9,115,000
Total (benefit) deferred provision	—			(2,400,000		)	1,441,000
Total provision (benefit) for income taxes	$	30,000		$	(2,963,000	)	$	3,130,000

The following table sets forth the changes in Kopin's balance of unrecognized tax benefits for the year ended:

	Total
Unrecognized tax benefits at December 26, 2016	$	374,000
Gross increases—prior year tax positions	20,000
Unrecognized tax benefits at December 30, 2017	394,000
Gross increases—current year tax positions	—
Unrecognized tax benefits at December 29, 2018	$	394,000

U.S. GAAP requires applying a 'more likely than not' threshold to the recognition and derecognition of uncertain tax positions either taken or expected to be taken by Kopin's income tax returns. The total amount of our gross tax liability for tax positions that may not be sustained under a 'more likely than not' threshold amounts to $0.4 million as of December 29, 2018 and December 30, 2017. Kopin's policy regarding the classification of interest and penalties is to include these amounts as a component of income tax expense. The total amount of accrued interest and penalties related to the Company's unrecognized tax benefits was $0.5 million as of December 29, 2018 and December 30, 2017.

Net operating losses were not utilized in 2018, 2017 and 2016 to offset federal and state taxes.

The actual income tax (benefit) provision reported from operations are different than those which would have been computed by applying the federal statutory tax rate to loss before income tax (benefit) provision. A reconciliation of income tax (benefit) provision from continuing operations as computed at the U.S. federal statutory income tax rate to the provision for income tax benefit is as follows:

	Fiscal Year
	2018			2017			2016
Tax provision at federal statutory rates	$	(7,515,000	)	$	(9,884,000	)	$	(6,965,000	)
State tax liability	5,000			5,000			22,000
Foreign deferred tax rate differential	(39,000		)	15,000			(678,000		)
Foreign withholding	301,000			(771,000		)	1,441,000
Outside basis in Kowon, net unremitted earnings	(468,000		)	(2,888,000		)	958,000
Permanent items	186,000			774,000			259,000
Increase in net state operating loss carryforwards	(406,000		)	(300,000		)	(502,000		)
Utilization of net operating losses for U.K. research and development refund	—			—			(142,000		)
Provision to tax return adjustments and tax rate change (1)	(76,000		)	24,833,000			(66,000		)
Tax credits	239,000			24,000			(762,000		)
Non-deductible 162M compensation limitations	13,000			199,000			—
Non-deductible equity compensation	290,000			1,901,000			(360,000		)
Uncertain tax position for transfer pricing	91,000			203,000			671,000
Other, net	45,000			107,000			139,000
Change in valuation allowance	7,364,000			(17,181,000		)	9,115,000
	$	30,000		$	(2,963,000	)	$	3,130,000

(1) Due to the Tax Act which was enacted in December 2017, our U.S. deferred tax assets and liabilities as of December 30, 2017 were re-measured to 21%. The provisional amount recorded related to the remeasurement of our deferred tax balance was approximately $25.1 million of tax expense.

Pretax foreign income from continuing operations was approximately $0.7 million for fiscal year ended 2018, pretax foreign loss from continuing operations was approximately $0.4 million for fiscal year ended 2017 and pretax foreign income from continuing operations was approximately $5.4 million for fiscal year ended 2016. Deferred income taxes are provided to recognize the effect of temporary differences between tax and financial reporting. Deferred income tax assets and liabilities consist of the following: 

	Fiscal Year
	2018			2017
Deferred tax liability:
Foreign withholding liability	$	(538,000	)	$	(812,000	)
Foreign unremitted earnings	—			(468,000		)
Intangible assets	—			(259,000		)
Deferred tax assets:
Federal net operating loss carryforwards	41,755,000			34,555,000
State net operating loss carryforwards	3,114,000			2,708,000
Foreign net operating loss carryforwards	1,259,000			1,500,000
Equity awards	444,000			55,000
Tax credits	7,231,000			7,470,000
Property, plant and equipment	640,000			544,000
Unrealized losses on investments	1,848,000			1,792,000
Other	1,707,000			3,037,000
Net deferred tax assets	57,460,000			50,122,000
Valuation allowance	(58,006,000		)	(50,642,000		)
	$	(546,000	)	$	(520,000	)

The valuation allowance was approximately $58.0 million and $50.6 million at December 29, 2018 and December 30, 2017, respectively, primarily driven by U.S. net operating loss carryforwards ("NOLs") and tax credits that the Company does not believe will ultimately be realized.

On December 22, 2017, the President signed the Tax Cuts and Jobs Act of 2017 ("2017 Act") which enacted a wide range of changes to the U.S. corporate income tax system. The 2017 Act reduced the U.S. corporate statutory federal tax rate to 21% effective in 2018, eliminated the domestic manufacturing deduction benefit and introduced other tax base broadening measures, changed rules for expensing and capitalizing business expenditures, established a territorial tax system for foreign earnings as well as a minimum tax on certain foreign earnings, provided for a one-time transition tax on previously undistributed foreign earnings, and introduced new rules for the treatment of certain foreign income. Also on December 22, 2017, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin No. 118 (SAB 118), which provided companies with additional guidance on how to account for the 2017 Act in their financial statements, allowing companies to use a measurement period. As of December 30, 2017, we made a reasonable estimate of the effects on our existing deferred tax balances and the one-time transition tax on previously undistributed foreign earnings and the Company did not recognize any provisional amounts in the (benefit) provision for income taxes in accordance with SAB 118. As of December 29, 2018, we had finalized our provisional estimates for the remeasurement of our existing U.S. deferred tax balances and the one-time transition tax and did not recognize amounts in the (benefit) provision for income taxes.

Deferred tax assets and liabilities—The Company has remeasured certain deferred tax assets and liabilities, excluding those items that will be included on the Company's 2017 tax return, based on the rates the Company expects to realize the deferred tax assets and liabilities at in the future, which is generally 21%. The amount recorded related to the remeasurement of the Company's deferred tax balance was approximately $25.1 million of tax expense. At December 29, 2018, we have finalized our provisional estimate for the remeasurement of our existed deferred tax balances with no additional adjustment.

The Company recorded a reduction in the valuation allowance during 2017 of approximately $1.0 million which was previously recorded against the Company’s AMT credit. The Company expects to receive a refund of $1.0 million from our AMT credit in accordance with the Tax Act and have recorded the receivable in "Other assets" on the Company's consolidated balance sheets at December 29, 2018.

In addition to the changes described above, the 2017 Act imposes a U.S. tax on global intangible low taxed income ("GILTI") that is earned by certain foreign affiliates owned by a U.S. shareholder. The computation of GILTI is generally intended to impose tax on the earnings of a foreign corporation that are deemed to exceed a certain threshold return relative to the underlying business investment. The Company has made a policy election to treat future taxes related to GILTI as a current period expense in the reporting period in which the tax is incurred.

Foreign tax effects—The one-time transition tax is based on our total post-1986 earnings and profits (“E&P”) for which the Company has previously deferred U.S. income taxes. The Company is estimating that the Company will not have a provisional requirement amount for our one-time transition tax liability, using an estimated applicable tax rate of 15.5%, resulting in no increase in income tax expense. The Company has not yet completed our calculation of the total post-1986 foreign E&P for these foreign subsidiaries. Further, the transition tax is based in part on the amount of those earnings held in cash and other specified assets. This amount may change when the Company finalizes the calculation of post-1986 foreign E&P previously deferred from U.S. federal taxation and finalize the amounts held in cash or other specified assets. The Company also expects additional clarifying and interpretative technical guidance to be issued related to the calculation of our one-time transition tax. No additional income taxes have been provided for any remaining undistributed foreign earnings not subject to the transition tax and any additional outside basis difference inherent in these entities as these amounts continue to be indefinitely reinvested in foreign operations.

As of December 29, 2018, the Company has available for tax purposes NOLs of $198.8 million expiring 2022 through 2037. The Company has recognized a full valuation allowance on its net deferred tax assets as the Company has concluded that such assets are not more likely than not to be realized. The decrease in valuation allowance during fiscal year 2018 was a result of decreases in the federal tax rate as part of the Tax Act and a reduction in the valuation allowance as a result of deferred tax liabilities assumed as part of the acquisition of NVIS.

The Tax Act imposes a mandatory transition tax on accumulated foreign earnings and eliminates U.S. taxes on foreign subsidiary distribution. As a result, earnings in foreign jurisdictions are available for distribution to the U.S. without incremental U.S. taxes.

Under the provisions of Section 382, certain substantial changes in Kopin’s ownership may limit in the future the amount of net operating loss carryforwards that could be used annually to offset future taxable income and income tax liability.

The Company’s income tax returns have not been examined by the Internal Revenue Service and are subject to examination for all years since 2001. State income tax returns are generally subject to examination for a period of three to five years after filing of the respective return. The state impact of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the states.

International jurisdictions have statutes of limitations generally ranging from three to twenty years after filing of the respective return. Years still open to examination by tax authorities in major jurisdictions include Korea (2009 onward), Japan (2009 onward), Hong Kong (2011 onward) and United Kingdom (2014 onward). The Company is not currently under examination in these jurisdictions.

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Cover Page - USD ($)	12 Months Ended
	Dec. 29, 2018	Mar. 08, 2019	Jun. 30, 2018
Cover page.
Document Type	10-K/A
Document Annual Report	true
Document Period End Date	Dec. 29, 2018
Document Transition Report	false
Entity File Number	0-19882
Entity Registrant Name	KOPIN CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	04-2833935
Entity Address, Address Line One	125 North Drive,
Entity Address, City or Town	Westborough
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	01581-3335
City Area Code	508
Local Phone Number	870-5959
Title of 12(b) Security	Common Stock, par value $0.01
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 164,583,000
Entity Common Stock, Shares Outstanding		76,282,062
Amendment Flag	true
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	FY
Trading Symbol	KOPN
Amendment Description	Kopin Corporation (the "Company" or "Kopin") is filing this Amendment No. 1 on Form 10-K/A (this "Form 10-K/A") to its Annual Report on Form 10-K for the fiscal year ended December 29, 2018, originally filed with the U.S. Securities and Exchange Commission (the "SEC") on March 14, 2019 (the "Original Form 10-K") to update the Report of Independent Registered Public Accounting Firm to indicate that the consolidated balance sheet as of December 30, 2017 was audited. In addition, the Company is correcting immaterial misstatements it has identified in its previously-issued consolidated financial statements and related financial information for the fiscal years ended December 29, 2018, December 30, 2017 and December 31, 2016.
Entity Central Index Key	0000771266
Current Fiscal Year End Date	--12-29

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Goodwill and Intangibles (Notes)

12 Months Ended

Dec. 29, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

 Goodwill and Intangibles

A rollforward of the Company's goodwill by segment is as follows:

	Kopin			Industrial			Total
Balance, December 31, 2016	$	844,023		$	—		$	844,023
March 2017 acquisition of NVIS, Inc.	—			1,488,650			1,488,650
Impairment of goodwill	—			(600,086		)	(600,086		)
Change due to exchange rate fluctuations	47,660			—			47,660
Balance, December 30, 2017	891,683			888,564			1,780,247
Impairment of goodwill	(528,906		)	(888,564		)	(1,417,470		)
Change due to exchange rate fluctuations	(31,433		)	—			(31,433		)
Balance, December 29, 2018	$	331,344		$	—		$	331,344

Goodwill is evaluated for impairment annually or more often if indicators of a potential impairment are present. The Company performs impairment tests of goodwill at its reporting unit level. The goodwill valuations that are utilized to test these assets for impairment are depending on a number of significant estimates and assumptions, including macroeconomic conditions, overall growth rates, competitive activities, cost containment, Company business plans and the discount rate applied to cash flows. We believe these estimates and assumptions are reasonable and are comparable to those that would be used by other market participants. However, actual events and results could differ substantially from those used in our valuations. To the extent such factors result in a failure to achieve the level of projected cash flows initially used to estimate fair value for purposes of establishing the carrying amount of goodwill, we may need to record non-cash impairment charges in the future.

At December 29, 2018, the Company performed an impairment analysis of goodwill based on a comparison of the discounted cash flows to the recorded carrying value of the reporting units, and determined that the discounted cash flows were not in excess of the carrying value of the NVIS reporting unit. At December 29, 2018, the Company decided to discontinue operations at its wholly-owned subsidiary, Kopin Software Ltd. and expects no future cash flows to support the carrying amount of goodwill. As a result, the Company recorded an impairment of goodwill of $1.4 million at December 29, 2018. The input methods for goodwill are analyzed for impairment on a nonrecurring basis using fair value measurements with unobservable inputs, which is Level 3 in the fair value hierarchy.

The Company recognized $0.9 million, $1.6 million and $0.0 million in amortization expense for the fiscal years ended 2018, 2017 and 2016, respectively, related to intangible assets. At December 29, 2018, the Company has a carrying value of $2.5 million and accumulated amortization of $2.5 million related to intangibles. The intangibles have no remaining useful life.

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS Statement - USD ($)	12 Months Ended
	Dec. 29, 2018	Dec. 30, 2017	Dec. 31, 2016
Statement of Comprehensive Income [Abstract]
Net loss	$ (34,482,492)	$ (25,380,115)	$ (23,031,145)
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	(1,912,427)	1,921,655	809,099
Unrealized holding (loss) gain on marketable securities	(264,949)	148,520	33,464
Reclassifications of gain (loss) in net loss	49,525	(6,376)	(48,284)
Other comprehensive (loss) income, net of tax	(2,127,851)	2,063,799	794,279
Comprehensive loss	(36,610,343)	(23,316,316)	(22,236,866)
Comprehensive loss (income) attributable to the noncontrolling interest	66,609	69,642	(532,654)
Comprehensive loss attributable to Kopin Corporation	$ (36,543,734)	$ (23,246,674)	$ (22,769,520)

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Property, Plant and Equipment

12 Months Ended

Dec. 29, 2018

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, Plant and Equipment

Property, plant and equipment consisted of the following at December 29, 2018 and December 30, 2017:

	Useful Life	2018			2017
Equipment	3-5 years	$	16,824,384		$	16,811,526
Leasehold improvements	Life of the lease	3,676,775			3,851,269
Furniture and fixtures	3 years	523,736			531,870
Equipment under construction		436,806			2,415,957
		21,461,701			23,610,622
Accumulated depreciation and amortization		(18,862,859		)	(18,533,579		)
Property, plant and equipment, net		$	2,598,842		$	5,077,043

Depreciation expense for the fiscal years 2018, 2017 and 2016 was approximately $1.0 million, $0.9 million and $1 million, respectively.

During the fiscal year 2018, the Company recorded asset impairment charges of $2.5 million associated with equipment that either is not currently being utilized or will not be utilized for its remaining useful life and is not recoverable.

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Goodwill and Intangibles (Tables)

12 Months Ended

Dec. 29, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

A rollforward of the Company's goodwill by segment is as follows:

	Kopin			Industrial			Total
Balance, December 31, 2016	$	844,023		$	—		$	844,023
March 2017 acquisition of NVIS, Inc.	—			1,488,650			1,488,650
Impairment of goodwill	—			(600,086		)	(600,086		)
Change due to exchange rate fluctuations	47,660			—			47,660
Balance, December 30, 2017	891,683			888,564			1,780,247
Impairment of goodwill	(528,906		)	(888,564		)	(1,417,470		)
Change due to exchange rate fluctuations	(31,433		)	—			(31,433		)
Balance, December 29, 2018	$	331,344		$	—		$	331,344

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Income Taxes (Tables)

12 Months Ended

Dec. 29, 2018

Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items]

Summary of Positions for which Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Table Text Block]

The following table sets forth the changes in Kopin's balance of unrecognized tax benefits for the year ended:

	Total
Unrecognized tax benefits at December 26, 2016	$	374,000
Gross increases—prior year tax positions	20,000
Unrecognized tax benefits at December 30, 2017	394,000
Gross increases—current year tax positions	—
Unrecognized tax benefits at December 29, 2018	$	394,000

Schedule of Components of Income Tax Expense (Benefit)

The (benefit) provision for income taxes from continuing operations consists of the following for the fiscal years indicated: 

	Fiscal Year
	2018			2017			2016
Current
State	$	5,000		$	5,000		$	33,000
Foreign	25,000			(568,000		)	1,656,000
Total current provision	30,000			(563,000		)	1,689,000
Deferred
Federal	(7,307,000		)	15,461,000			(8,718,000		)
State	(360,000		)	(493,000		)	(1,264,000		)
Foreign	300,000			(187,000		)	2,308,000
Change in valuation allowance	7,367,000			(17,181,000		)	9,115,000
Total (benefit) deferred provision	—			(2,400,000		)	1,441,000
Total provision (benefit) for income taxes	$	30,000		$	(2,963,000	)	$	3,130,000

Schedule of Effective Income Tax Rate Reconciliation

The actual income tax (benefit) provision reported from operations are different than those which would have been computed by applying the federal statutory tax rate to loss before income tax (benefit) provision. A reconciliation of income tax (benefit) provision from continuing operations as computed at the U.S. federal statutory income tax rate to the provision for income tax benefit is as follows:

	Fiscal Year
	2018			2017			2016
Tax provision at federal statutory rates	$	(7,515,000	)	$	(9,884,000	)	$	(6,965,000	)
State tax liability	5,000			5,000			22,000
Foreign deferred tax rate differential	(39,000		)	15,000			(678,000		)
Foreign withholding	301,000			(771,000		)	1,441,000
Outside basis in Kowon, net unremitted earnings	(468,000		)	(2,888,000		)	958,000
Permanent items	186,000			774,000			259,000
Increase in net state operating loss carryforwards	(406,000		)	(300,000		)	(502,000		)
Utilization of net operating losses for U.K. research and development refund	—			—			(142,000		)
Provision to tax return adjustments and tax rate change (1)	(76,000		)	24,833,000			(66,000		)
Tax credits	239,000			24,000			(762,000		)
Non-deductible 162M compensation limitations	13,000			199,000			—
Non-deductible equity compensation	290,000			1,901,000			(360,000		)
Uncertain tax position for transfer pricing	91,000			203,000			671,000
Other, net	45,000			107,000			139,000
Change in valuation allowance	7,364,000			(17,181,000		)	9,115,000
	$	30,000		$	(2,963,000	)	$	3,130,000

Schedule of Deferred Tax Assets and Liabilities

Deferred income taxes are provided to recognize the effect of temporary differences between tax and financial reporting. Deferred income tax assets and liabilities consist of the following: 

	Fiscal Year
	2018			2017
Deferred tax liability:
Foreign withholding liability	$	(538,000	)	$	(812,000	)
Foreign unremitted earnings	—			(468,000		)
Intangible assets	—			(259,000		)
Deferred tax assets:
Federal net operating loss carryforwards	41,755,000			34,555,000
State net operating loss carryforwards	3,114,000			2,708,000
Foreign net operating loss carryforwards	1,259,000			1,500,000
Equity awards	444,000			55,000
Tax credits	7,231,000			7,470,000
Property, plant and equipment	640,000			544,000
Unrealized losses on investments	1,848,000			1,792,000
Other	1,707,000			3,037,000
Net deferred tax assets	57,460,000			50,122,000
Valuation allowance	(58,006,000		)	(50,642,000		)
	$	(546,000	)	$	(520,000	)

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Selected Quarterly Financial Information (Unaudited) (Tables)

12 Months Ended

Dec. 29, 2018

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Information [Table Text Block]

Quarterly Periods During Fiscal Year Ended December 29, 2018: 

(in thousands, except per share data)	Three months ended March 31, 2018 (3)			Three months ended June 30, 2018			Three months ended September 29, 2018			Three months ended December 29, 2018 (4)
Total revenue	$	5,654		$	5,944		$	5,126		$	7,741
Gross profit (2)	983			974			(16		)	1,439
Loss from operations	(9,792		)	(8,992		)	(10,299		)	(10,884		)
Net loss attributable to the controlling interest	(5,536		)	(9,241		)	(9,791		)	(9,966		)
Net loss per share (1):
Basic and diluted	$	(0.08	)	$	(0.13	)	$	(0.13	)	$	(0.14	)
Weighted average number of common shares outstanding:
Basic and diluted	73,078			73,095			73,135			73,317

(1) Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.

(2) Gross profit is defined as net product revenues less cost of product revenues.

(3) Includes $2.9 million impact on net gain attributable to Kopin Corporation relating to the gain on an equity investment for the three month period ended March 31, 2018.

(4) Includes $1.3 million impact from correction adjustments. For discussion of the correcting adjustments, see Note 18 - Correction of Previously Issued Financial Statements.

Quarterly Periods During Fiscal Year Ended December 30, 2017:

(in thousands, except per share data)	Three months ended April 1, 2017			Three months ended July 1, 2017			Three months ended September 30, 2017			Three months ended December 30, 2017 (3)
Total revenue	$	4,378		$	5,927		$	6,139		$	11,397
Gross profit (2)	816			862			1,444			3,654
Loss from operations	(8,663		)	(8,068		)	(8,605		)	(4,962		)
Net loss attributable to the controlling interest	(7,858		)	(7,332		)	(8,247		)	(1,803		)
Net loss per share (1):
Basic and diluted	$	(0.12	)	$	(0.10	)	$	(0.11	)	$	(0.02	)
Weighted average number of common shares outstanding:
Basic and diluted	64,539			70,627			72,188			72,349

(1) Net loss per share is computed independently for each of the quarters presented; accordingly, the sum of the quarterly net income per share may not equal the total computed for the year.

(2) Gross profit is defined as net product revenues less cost of product revenues.

(3) Includes $1.7 million impact on net gain attributable to Kopin Corporation relating to the gain on a warrant for the three month period ended December 30, 2017.