December 27, 2008, we spent $5.0 million and
$14.8 million, respectively, on capital equipment.
Our strategy for delivering products to our retail customers gives us the flexibility to provide container
shipments directly to the retailer from China and, alternatively allows our retail partners to take possession of
product on a domestic basis. Accordingly, our home robots product inventory consists of goods shipped to our thirdparty
logistic providers for the fulfillment of retail orders and direct-to-consumer sales. Our inventory of
government and industrial products is relatively low as they are generally built to order. Our contract manufacturers
51
are responsible for purchasing and stocking the majority of components required for the production of our products,
and they invoice us when the finished goods are shipped.
Our consumer product sales are, and are expected to continue to be, highly seasonal. This seasonality has
historically resulted in a net use of cash in support of operating needs during the second and third quarters of the
year, with the low point generally occurring in the third quarter, and a favorable cash flow during the first and fourth
quarters. The cash balance of $71.9 million at January 2, 2010 is primarily the result of our significant focus over the
past year on managing working capital, with specific emphasis placed on reducing inventory levels.We have relied
on our working capital line of credit to cover short-term cash needs resulting from the seasonality of our consumer
business in prior years.We currently do not have any borrowings outstanding under our existing working capital line
of credit.