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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
 Form 10-K
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Fiscal
    Year Ended January 2,
    2010ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period from
    
    to   Commission File Number:
    001-34006
  THE MANAGEMENT NETWORK GROUP,
    INC.
 (Exact name of registrant as
    specified in its charter)
  DELAWARE(State or other jurisdiction
    of
    incorporation or organization)

48-1129619(I.R.S. Employer
    identification number)   7300 COLLEGE BOULEVARD,
 SUITE 302, OVERLAND PARK, KANSAS 66210
 (Address of principal executive
    offices) (Zip Code)
  REGISTRANTS TELEPHONE NUMBER, INCLUDING AREA CODE:
 (913) 345-9315
 SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE
    ACT:
  Title of Each Class

Name of Each Exchange on Which RegisteredCOMMON STOCK, $.005 PAR VALUE PER SHARE

The NASDAQ STOCK MARKET, LLC   SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE
    ACT:
 NONE.
  o þ
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
  Large accelerated filer o

Accelerated filer o

Non-accelerated filero
    (Do not check if a smaller reporting company)

Smaller reporting company þ   Rule 12b-2 o þ
    DOCUMENTS
    INCORPORATED BY REFERENCE
  Form 10-K




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##### 





THE
    MANAGEMENT NETWORK GROUP, INC.
  FORM 10-K
  TABLE OF
    CONTENTS
   
 PagePART ICautionary Statement Regarding Forward-Looking
    Information


3Item 1.


Business


4Item 1A.


Risk Factors


12Item 1B.


Unresolved Staff Comments


12Item 2.


Properties


12Item 3.


Legal Proceedings


12Item 4.


Reserved


12PART IIItem 5.


Market for Registrants Common Equity,
    Related Stockholder Matters, and Issuer Purchases of Equity
    Securities


13Item 6.


Selected Financial Data


13Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


13Item 7A.


Quantitative and Qualitative Disclosures About
    Market Risk


29Item 8.


Consolidated Financial Statements


30Item 9.


Changes in and Disagreements With Accountants on
    Accounting and Financial Disclosure


59Item 9A(T).


Controls and Procedures


59Item 9B.


Other Information


59PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance


60Item 11.


Executive Compensation


60Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


60Item 13.


Certain Relationships, and Related Transactions
    and Director Independence


60Item 14.


Principal Accountant Fees and Services


60PART IVItem 15.


Exhibits, Financial Statement Schedules


61EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1           2




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PART I CAUTIONARY
    STATEMENT REGARDING FORWARD-LOOKING INFORMATION  Form 10-K
    
    conditions in the industry sectors that we serve, including the
    economic conditions in such industry sectors, that can result in
    slowing client decisions on proposals and project opportunities
    along with scope reduction of existing projects;
    the financial condition and business strategies of our customers
    in the converging communications, media and entertainment
    industry and the investment banking and private equity firms
    investing in that industry;
    overall economic and business conditions, including the current
    conditions in the real estate and credit markets and general
    economic conditions;
    the level of demand for our services;
    the potential continuation or recurrence of recent losses from
    operations, negative cash flow and reductions in our cash
    reserves;
    our ability to retain the limited number of large clients that
    constitute a major portion of our revenues;
    fluctuations in our quarterly operating results;
    our ability to reduce our cost structure to align with reduced
    demand and to control costs under fixed fee contracts, which
    make up a substantial portion of our business;
    our ability to compete in intensively competitive markets,
    including our ability to address actions by competitors that
    could render our services less competitive, such as recently
    increasing price competition, which may cause our revenues,
    gross profits and income to decline;
    our ability to address the challenges of conducting business in
    foreign countries, including risks of unfavorable foreign
    currency exchange rates or fluctuations and changes in local
    laws;
    the possibility of further impairments of goodwill if our
    financial performance does not meet or exceed our projections
    used to value the assets or if there is a further decline in our
    stock price;
    the possibility of further write-downs in the value of our
    auction rate securities due to future fluctuations in interest
    rates, counter-party credit ratings and liquidity in the
    secondary market for these securities;
    our ability to successfully integrate recent acquisitions and to
    successfully locate new acquisition candidates;
    our level of cash and non-cash expenditures; 3




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
    technological advances and competitive factors in the markets in
    which we compete;
    the possibility of the cancellation of key client contracts,
    which may be cancelled on short notice;
    the ability to successfully launch new product and market
    initiatives;
    the ability to retain key management and consulting personnel,
    particularly given the performance of our stock and the impact
    of a low stock price on the value of share-based compensation;
    the possible reclassification of our independent contractors as
    full-time employees by the taxing
    and/or labor
    and employment authorities of competent jurisdiction;
    the possibility of professional liability claims;
    the loss of key intellectual property;
    our ability to satisfy the continued listing requirements of the
    NASDAQ Stock Market; and
    the possibility that our ability to utilize tax net operating
    loss carryforwards to offset future taxable income will be
    limited if we are deemed to have an ownership change as defined
    by Section 382 of the Internal Revenue Code.  Form 10-K
  ITEM 1.
    BUSINESS    GENERAL
       4




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® U.S.-based
       5




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MARKET
    OVERVIEW
        BUSINESS
    STRATEGY
    -
    Develop and evolve offerings, solutions and thought
    leadership
  end-to-end
 6




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-
    Continue to build the TMNG Global brand
  end-to-end
  -
    Focused and effective recruitment and retention
        -
    Enhancing our global presence
    -
    Increase penetration within top revenue-generating
    clients
   7




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SERVICES
    -
    Strategy and Business Case Development
    -
    Knowledge Management
    -
    Revenue and Cost Management
  end-to-end, order-to-cash
  ® ® ®
  -
    Program Management
    -
    Business and Operations Process Redesign and
    Reengineering
   8




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-
    Corporate Investment Services
    -
    Technical Consultancy & Software
    Development
    ® ® ®
  -
    Marketing
    COMPETITION
  and/or
   9




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RISKS
    RELATED TO CURRENT ECONOMIC CONDITIONS
    EMPLOYEES
     10




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BUSINESS
    SEGMENTS
  280-10, Segment Reporting
  MAJOR
    CUSTOMERS
      FOREIGN
    MARKETS
   11




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INTELLECTUAL
    PROPERTY
    SEASONALITY
    WEBSITE
    ACCESS TO INFORMATION
  Form 10-K, Form 10-Q, Form 8-K,
  ITEM 1A.
    RISK
    FACTORS    ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS    ITEM 2.
    PROPERTIES    LeaseLocation

Sq. Feet


ExpirationMcLean, Virginia


4,881


July 2019Boston, Massachusetts


21,710


January 2011Somerset, New Jersey


2,910


February 2014London, England (Gate Street)


11,825


November 2015     ITEM 3.
    LEGAL
    PROCEEDINGS    ITEM
    4.
    RESERVED 12




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##### Table of Contents



PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES  one-for-five
  one-for-five
  High

LowFirst quarter, fiscal year 2009

$
3.00


$
0.80Second quarter, fiscal year 2009

$
2.80


$
1.10Third quarter, fiscal year 2009

$
7.25


$
1.05Fourth quarter, fiscal year 2009

$
3.50


$
1.75   High

LowFirst quarter, fiscal year 2008

$
13.75


$
7.75Second quarter, fiscal year 2008

$
10.40


$
6.90Third quarter, fiscal year 2008

$
7.25


$
4.75Fourth quarter, fiscal year 2008

$
4.95


$
1.90   mark-up,
      ITEM 6.
    SELECTED
    FINANCIAL DATA    ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  Form 10-K.
 13




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Form 10-K
    OVERVIEW
           14




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15




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16




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CRITICAL
    ACCOUNTING
    POLICIES 
      
    Marketable Securities;
    Impairment of Goodwill and Long-lived Assets;
    Revenue Recognition;
    Share-based Compensation Expense;
    Accounting for Income Taxes; and
    Research and Development and Capitalized Software Costs.  Marketable Securities Investments-Debt and Equity Securities. Fair Value Measurements and
    Disclosures. available-for-sale, other-than-temporary,
       17




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Derivatives and Hedging. Financial Instruments
  available-for-sale available-for-sale
    available-for-sale,
    Impairment of Goodwill and Long-lived Assets Intangibles-Goodwill and Other
   18




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
    Anticipated future cash flows and terminal value for each
    reporting unit  The income approach to
    determining fair value relies on the timing and estimates of
    future cash flows, including an estimate of terminal value. The
    projections use managements estimates of economic and
    market conditions over the projected period including growth
    rates in revenues and estimates of expected changes in operating
    margins. Our projections of future cash flows are subject to
    change as actual results are achieved that differ from those
    anticipated. Because management frequently updates its
    projections, we would expect to identify on a timely basis any
    significant differences between actual results and recent
    estimates.
    Selection of an appropriate discount rate The
    income approach requires the selection of an appropriate
    discount rate, which is based on a weighted average cost of
    capital analysis. The discount rate is affected by changes in
    short-term interest rates and long-term yield as well as
    variances in the typical capital structure of marketplace
    participants. The discount rate is determined based on
    assumptions that would be used by marketplace participants, and
    for that reason, the capital structure of selected marketplace
    participants was used in the weighted average cost of capital
    analysis. Given the current volatile economic conditions, it is
    possible that the discount rate will fluctuate in the near term.  Property, Plant and
    Equipment
    Revenue Recognition 605-35, Revenue Recognition  Construction-Type and
    Production-Type Contracts No. 81-1, Accounting for Performance of Construction-Type and
    Certain Production-Type Contracts
  605-35. right-to-use
 19




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605-35 percentage-of-completion-like
  605-35 605-25, Revenue Recognition  Multiple-Element
    Arrangements No. 00-21, Revenue Arrangements with Multiple
    Deliverables 605-25 and/or 605-25
    Share-based Compensation Expense Compensation-Stock Compensation.
   20




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Income Taxes 
     21




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Research and Development and Capitalized Software
    Costs 985-20, Software  Costs of Software to Be Sold,
    Leased, or Marketed
  RECENT
    ACCOUNTING PRONOUNCEMENTS
  855-10, Subsequent Events 855-10). 855-10 855-10
  105-10, Generally Accepted Accounting Principles  Overall 105-10)
  No. 2009-05 820-10) 820-10
  No. 2009-13, Revenue Recognition (Topic 605) 
    Multiple-Deliverable Revenue Arrangements, a consensus of the
    FASB Emerging Issue Task Force 2009-13), No. 2009-14, Software (Topic 985)  Certain Revenue Arrangements
    That Include Software Elements 2009-14). 2009-13 2009-14
 22




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RESULTS
    OF OPERATIONS
  FISCAL
    2009 COMPARED TO FISCAL 2008
  REVENUES
    Management Consulting Services Segment
      Software Solutions Segment
  COST OF
    SERVICES
   23




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OPERATING
    EXPENSES
        OTHER
    INCOME AND EXPENSES
    INCOME
    TAXES
   24




---



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NET
    LOSS
    STATEMENT
    REGARDING NON-GAAP FINANCIAL MEASUREMENT
   25




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RECONCILIATION
    OF GAAP NET LOSS TO NON-GAAP ADJUSTED NET INCOME
    (unaudited)
  Fifty-Two


Fifty-ThreeWeeks Ended


Weeks EndedJanuary 2,


January 3,2010


2009(In thousands, except per share data)Reconciliation of GAAP net loss to non-GAAP adjusted net
    income:GAAP net loss

$
(3,242
)

$
(14,825
)Goodwill, intangible and long-lived asset impairment






14,451Realized (gain) loss on auction rate securities


(224
)


280Depreciation and amortization


3,379



5,385Non-cash share based compensation expense


858



1,817Tax effect of applicable non-GAAP adjustments


(82
)


(965
)Adjustments to GAAP net loss


3,931



20,968Non-GAAP adjusted net income

$
689


$
6,143Reconciliation of GAAP net loss per diluted common share to
    non-GAAP adjusted net income per diluted common share:GAAP net loss per diluted common share

$
(0.46
)

$
(2.09
)Goodwill, intangible and long-lived asset impairment






2.04Realized (gain) loss on auction rate securities


(0.03
)


0.04Depreciation and amortization


0.48



0.76Non-cash share based compensation expense


0.12



0.26Tax effect of applicable non-GAAP adjustments


(0.01
)


(0.14
)Adjustments to GAAP net loss per diluted common share


0.56



2.96Non-GAAP adjusted net income per diluted common share

$
0.10


$
0.87Weighted average shares used in calculation of diluted net loss
    per common share


6,986



7,089   LIQUIDITY
    AND CAPITAL RESOURCES
    true-ups.
   26




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27




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other-than-temporary
    FINANCIAL
    COMMITMENTS AND OFF BALANCE SHEET ARRANGEMENTS
   28




---



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TRANSACTIONS
    WITH RELATED PARTIES
      ITEM 7A.
    QUALITATIVE
    AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK   29




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ITEM 8.
    CONSOLIDATED
    FINANCIAL STATEMENTS  REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
             /s/
    DELOITTE &
    TOUCHE LLP     30




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THE
    MANAGEMENT NETWORK GROUP, INC.
    CONSOLIDATED BALANCE SHEETS
  January 2,


January 3,2010


2009(In thousands, except share data)ASSETSCURRENT ASSETS:Cash and cash equivalents

$
6,301


$
5,956Short-term investments


5,444Receivables:Accounts receivable


11,991



8,247Accounts receivable  unbilled


4,174



4,54016,165



12,787Less: Allowance for doubtful accounts


(357
)


(379
)Net receivables


15,808



12,408Prepaid and other current assets


1,206



1,653Total current assets


28,759



20,017NONCURRENT ASSETS:Property and equipment, net


1,955



1,801Goodwill


7,772



6,240Identifiable intangible assets, net


2,516



4,842Non-current investments


6,852



13,404Other assets


397



410Total Assets

$
48,251


$
46,714LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIES:Trade accounts payable

$
1,118


$
1,138Current borrowings


2,800Accrued payroll, bonuses and related expenses


5,354



4,053Other accrued liabilities


1,433



3,010Deferred revenue


1,023



476Accrued contingent consideration






161Unfavorable and other contractual obligations


706



697Total current liabilities


12,434



9,535NONCURRENT LIABILITIES:Unfavorable and other contractual obligations


546



1,062Noncurrent borrowings






1,485Other noncurrent liabilities


1,237



1,006Total noncurrent liabilities


1,783



3,553Commitments and contingencies (Note 14)STOCKHOLDERS EQUITY:Common stock:Voting  $.005 par value, 20,000,000 shares
    authorized; 7,468,310 (including 440,000 treasury shares) and
    7,393,025 (including 440,000 treasury shares) shares issued as
    of January 2, 2010 and January 3, 2009, respectively;
    7,028,310 and 6,953,025 shares outstanding as of
    January 2, 2010 and January 3, 2009, respectively


37



37Preferred stock  $.001 par value,
    10,000,000 shares authorized; no shares issued or
    outstandingAdditional paid-in capital


176,680



175,691Accumulated deficit


(134,948
)


(131,706
)Treasury stock, at cost


(3,545
)


(3,545
)Accumulated other comprehensive income Foreign currency translation adjustment


(3,792
)


(5,735
)Loss on investments


(398
)


(1,116
)Total stockholders equity


34,034



33,626Total Liabilities and Stockholders Equity

$
48,251


$
46,714    31




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THE
    MANAGEMENT NETWORK GROUP, INC.
  CONSOLIDATED
    STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
  Fifty-Two


Fifty-ThreeWeeks Ended


Weeks EndedJanuary 2,


January 3,2010


2009(In thousands, except per share data)Revenues

$
64,953


$
74,042Cost of services (includes net non-cash share-based compensation
    expense of $260 and $545 for the 2009 and 2008 fiscal years,
    respectively)


38,036



41,055Gross Profit


26,917



32,987Operating Expenses:Selling, general and administrative (includes net non-cash
    share-based compensation expense of $598 and $1,272 for the 2009
    and 2008 fiscal years, respectively)


28,497



30,124Intangible asset amortization


1,975



3,916Goodwill, intangible and long-lived asset impairment






14,451Total operating expenses


30,472



48,491Loss from operations


(3,555
)


(15,504
)Interest income


259



922Interest expense


(55
)Other income (expense), net


335



(249
)Total other income


539



673Loss before income taxes


(3,016
)


(14,831
)Income tax (provision) benefit


(226
)


6Net loss


(3,242
)


(14,825
)Other comprehensive loss:Foreign currency translation adjustment


1,943



(5,955
)Unrealized gain (loss) on marketable securities


718



(1,116
)Comprehensive loss

$
(581
)

$
(21,896
)Net loss per common shareBasic and diluted

$
(0.46
)

$
(2.09
)Weighted average shares used in calculation of net loss per
    share:Basic


6,986



7,089Diluted


6,986



7,089    32




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
    CONSOLIDATED STATEMENTS OF CASH FLOWS
   Fiscal Year EndedJanuary 2,


January 3,2010


2009(In thousands)CASH FLOWS FROM OPERATING ACTIVITIES:Net loss

$
(3,242
)

$
(14,825
)Adjustments to reconcile net loss to net cash provided by
    operating activities:Goodwill and intangible asset impairment






14,451Depreciation and amortization


3,379



5,386Share-based compensation


858



1,817Deferred taxes


145



(1,077
)Bad debt recoveries






(227
)Realized (gain) loss on investments


(224
)


280Other changes in operating assets and liabilities:Accounts receivable


(3,291
)


3,389Accounts receivable  unbilled


601



2,423Prepaid and other assets


398



76Trade accounts payable


(74
)


(572
)Income tax liabilities


(73
)


(216
)Deferred revenue


494



(2,962
)Accrued liabilities


1,448



(1,653
)Net cash provided by operating activities


419



6,290CASH FLOWS FROM INVESTING ACTIVITIES:Proceeds from maturities/sales of marketable securities


2,050



2,325Acquisition of businesses, net of cash acquired


(3,054
)


(5,426
)Acquisition of property and equipment


(618
)


(1,059
)Net cash used in investing activities


(1,622
)


(4,160
)CASH FLOWS FROM FINANCING ACTIVITIES:Borrowings on line of credit


3,400



1,485Payments on line of credit


(2,085
)Payments made on unfavorable and other contractual obligations


(681
)


(1,656
)Purchases of common stock






(3,200
)Proceeds from exercise of stock options






26Issuance of common stock through employee stock purchase plan


27



129Net cash provided by (used in) financing activities


661



(3,216
)Effect of exchange rate on cash and cash equivalents


887



(2,980
)Net increase (decrease) in cash and cash equivalents


345



(4,066
)Cash and cash equivalents, beginning of period


5,956



10,022Cash and cash equivalents, end of period

$
6,301


$
5,956Supplemental disclosure of cash flow information:Cash paid during period for interest

$
55Cash paid during period for taxes, net of refunds

$
156


$
1,249Accrued property and equipment additions

$
325


$
17Supplemental disclosure of non-cash investing and financing
    transactionsAcquisition of business: Common stock

$
104


$
922Acquisition of business: Contingent consideration earned





$
1,860    33




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THE
    MANAGEMENT NETWORK GROUP, INC.
  CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY
  Common Stock











Accumulated$.005 Par


Additional








OtherVoting


Paid-In


Accumulated


Treasury


ComprehensiveShares


Amount


Capital


Deficit


Stock


Income


Total(In thousands, except per share data)Balance, December 29, 2007


7,237,029


$
36


$
172,798


$
(116,881
)

$
(345
)

$
220


$
55,828Share repurchases


















(3,200
)






(3,200
)Exercise of options


2,555







26















26Employee stock purchase plan


22,546







129















129Share-based compensation










1,817















1,817Common stock issued for acquisitions


130,895



1



921















922Other comprehensive income  Foreign currency
    translation adjustment






















(5,955
)


(5,955
)Other comprehensive income  Loss on investment






















(1,116
)


(1,116
)Net loss














(14,825
)










(14,825
)Balance, January 3, 2009


7,393,025



37



175,691



(131,706
)


(3,545
)


(6,851
)


33,626Employee stock purchase plan


19,027







27















27Share-based compensation










858















858Common stock issued for acquisitions


56,325







104















104Other comprehensive income  Foreign currency
    translation adjustment






















1,943



1,943Other comprehensive income  Loss on investment






















718



718One-for-five
    reverse stock split


(67
)






















Net loss














(3,242
)










(3,242
)Balance, January 2, 2010


7,468,310


$
37


$
176,680


$
(134,948
)

$
(3,545
)

$
(4,190
)

$
34,034    34




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    ORGANIZATION
    AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Nature of Operations 
  Principles of Consolidation 
  Name of Subsidiary/Acquisition

Date Formed/AcquiredTMNG Europe Ltd. (TMNG Europe)


March 19, 1997The Management Network Group Canada Ltd. (TMNG
    Canada)


May 14, 1998TMNG.com, Inc.


June 18, 1999TMNG Marketing, LLC (TMNG Marketing, Inc. merged into TMNG
    Marketing, LLC on January 2, 2010).


September 5, 2000TMNG Technologies, Inc.


August 27, 2001Cambridge Strategic Management Group, Inc. (CSMG)


March 6, 2002Cambridge Adventis Ltd.


March 17, 2006Cartesian Ltd. (Cartesian)


January 2, 2007RVA Consulting, LLC (RVA)


August 3, 2007TWG Consulting, Inc. (TWG)


October 5, 2007   Fiscal Year 
  Reverse Stock Split one-for-five
  Subsequent Events 
  Revenue Recognition
 35




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THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  605-35, Revenue Recognition  Construction-Type and
    Production-Type Contracts No. 81-1, Accounting for Performance of Construction-Type and
    Certain Production-Type Contracts
  605-35. right-to-use
  percentage-of-completion-like
  605-35 605-25 Revenue Recognition  Multiple-Element
    Arrangements No. 00-21, 605-25 and/or 605-25
   36




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THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Cash and Cash Equivalents 
  Marketable Securities  Investments 
    Debt and Equity Securities. Fair Value
    Measurements and Disclosures. other-than-temporary,
  Fair Value Measurement 
    Level 1:
  Level 2:
  Level 3:
    Property and Equipment 
  Research and Development and Capitalized Software
    Costs  985-20, Software  Costs of Software to Be Sold,
    Leased, or Marketed
 37




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THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Goodwill Intangibles-Goodwill and Other.
    Anticipated future cash flows and terminal value for each
    reporting unit
  Selection of an appropriate discount rate
  Intangible Assets
 38




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Property, Plant and
    Equipment
  Income Taxes 
  Use of Estimates 
  Foreign Currency Transactions and Translation 
  Derivative Financial Instruments
  Share-Based Compensation  Compensation-Stock Compensation
  Loss Per Share 
 39




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Recent Accounting Pronouncements 105-10, Generally Accepted Accounting Principles  Overall 105-10)
  No. 2009-05 820-10) 820-10
  No. 2009-13, Revenue Recognition (Topic 605)
     Multiple-Deliverable Revenue Arrangements, a
    consensus of the FASB Emerging Issue Task Force 2009-13), No. 2009-14, Software (Topic 985)  Certain Revenue Arrangements
    That Include Software Elements 2009-14). 2009-13 2009-14
 40




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2.
    AUCTION
    RATE SECURITIES    Fair Value atRealized





January 2,Cost


Gains


Unrealized


2010Issuer

Basis


(Losses)


Losses


Current


Noncurrent(In thousands)Trading SecuritiesKentucky Higher Education Loan Revenue

$
1,900


$
(118
)





$
1,782Missouri Higher Education Loan Revenue


1,800



(112
)






1,688Utah State Board of Regents Revenue Bonds


1,400



(87
)






1,313Kentucky Higher Education Loan Revenue


400



(25
)






3755,500



(342
)






5,158Available-for-Sale
    SecuritiesEducation Funding Capital Education Loan Backed Notes


6,250






$
(389
)





$
5,861Brazos Student Finance Corporation Student Loan Asset Backed
    Notes


1,000







(9
)






9917,250







(398
)






6,852ARS Rights






286







286$
12,750


$
(56
)

$
(398
)

$
5,444


$
6,852  41




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Fair Value atRealized





January 3,Gains


Unrealized


2009Issuer

Cost Basis


(Losses)


Losses


Noncurrent(In thousands)Trading SecuritiesKentucky Higher Education Loan Revenue

$
1,900


$
(303
)





$
1,597Missouri Higher Education Loan Revenue


1,800



(287
)






1,513Utah State Board of Regents Revenue Bonds


1,400



(232
)






1,168Access Group Inc. Federal Student Loan


2,050



(216
)






1,834Asset Backed NotesKentucky Higher Education Loan Revenue


400



(145
)






2557,550



(1,183
)






6,367Available-for-Sale
    SecuritiesEducation Funding Capital Education Loan Backed Notes


6,250






$
(1,015
)


5,235Brazos Student Finance Corporation Student Loan Asset Backed
    Notes


1,000







(101
)


8997,250







(1,116
)


6,134ARS Rights






903







903$
14,800


$
(280
)

$
(1,116
)

$
13,404        42




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Derivatives and Hedging.
  available-for-sale available-for-sale
    available-for-sale
      For the Fiscal


For the FiscalYear Ended


Year EndedJanuary 2,


January 3,2010


2009Fair value at beginning of period

$
13,404


$
17,125Total unrealized and realized gains (losses) included in Other
    income in the Consolidated Statements of Operations and
    Comprehensive Loss


224



(280
)Total unrealized gains (losses) included in Other comprehensive
    income (loss) in the Consolidated Statements of Operations and
    Comprehensive Loss


718



(1,116
)Sales


(2,050
)


(2,325
)Fair value at end of period

$
12,296


$
13,404  43




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    3.
    LINE OF
    CREDIT AGREEMENTS         44




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  4.
    BUSINESS
    COMBINATIONS  TWG
    Consulting, Inc.
    RVA
    Consulting, LLC
  true-ups
  Cash paid at closing

$
6,625Transaction costs


247Contingent cash consideration earned


3,273Contingent stock consideration earned (based on June 30,
    2008 measurement date)


921Contingent stock consideration earned (based on June 30,
    2009 measurement date)


104Total purchase price recognized at January 2, 2010


11,170Remaining contingent cash consideration


344Remaining contingent stock consideration (based on share price
    as of January 3, 2010)


42Aggregate potential consideration

$
11,556     Cartesian
    Limited
  true-ups
 45




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Cash paid at closing

$
6,495Transaction costs


534Contingent consideration earned and paid


8,462Aggregate purchase price

$
15,491   5.
    GOODWILL
    AND OTHER INTANGIBLE ASSETS    ManagementConsulting


SoftwareServices


SolutionsSegment


Segment


TotalBalance as of December 29, 2007

$
13,365






$
13,3652008 Cartesian goodwill from earn-out payments, including
    changes in foreign currency exchange rates





$
3,775



3,7752008 RVA goodwill from earn-out payments


2,465







2,4652008 impairment loss


(13,365
)






(13,365
)Balance as of January 3, 2009


2,465



3,775



6,2402009 RVA goodwill from earn-out payments


1,085







1,085Changes in foreign currency exchange rates






447



447Balance as of January 2, 2010

$
3,550


$
4,222


$
7,772     As of


As of


As ofJanuary 2,


January 3,


December 29,2010


2009


2007Gross balance of goodwill

$
67,641


$
66,109


$
59,869Accumulated goodwill impairment losses


(59,869
)


(59,869
)


(46,504
)Net balance of goodwill

$
7,772


$
6,240


$
13,365     January 2, 2010


January 3, 2009Accumulated





AccumulatedCost


Amortization


Cost


AmortizationCustomer relationships

$
5,342


$
(3,511
)

$
5,136


$
(2,072
)Acquired software


2,427



(1,820
)


2,170



(1,085
)Employment agreements


2,018



(1,940
)


1,847



(1,154
)Total

$
9,787


$
(7,271
)

$
9,153


$
(4,311
)    46




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    EstimatedIntangibleTotal Estimated

Amortization toIntangible

be Included inFuture Period

Amortization

Cost of ServicesFiscal year 2010

$
2,020


$
607Fiscal year 2011


496     Property, Plant and
    Equipment Intangibles-Goodwill and Other.
  6.
    SHARE-BASED
    COMPENSATION    Fiscal Year

Fiscal Year2009

2008Risk-free interest rate

2.1%

2.8%Expected life

6.3 years

6.3 yearsExpected volatility factor

61%

60%Expected dividend rate

0%

0%      47




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      1998
    EQUITY INCENTIVE PLAN
    Stock
    Options
        WeightedWeighted


AverageAverage


Remaining


AggregateExercise


Contractual


IntrinsicShares


Price


Term


ValueOutstanding at January 3, 2009


857,622


$
18.08Granted


9,500


$
1.48Forfeited/cancelled


(103,575
)

$
20.34Outstanding at January 2, 2010


763,547


$
17.57



5.7 years


$
6,000Options vested and expected to be vested at January 2, 2010


688,692


$
18.29



5.4 years


$
5,000Options exercisable at January 2, 2010


605,848


$
19.41



5.3 years  48




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Nonvested
    Stock
      WeightedAverageGrant DateShares


Fair ValueOutstanding at January 3, 2009


11,375


$
11.17Vested


(10,125
)

$
11.19Outstanding at January 2, 2010


1,250


$
10.95     2000
    SUPPLEMENTAL STOCK PLAN
      WeightedWeighted


AverageAverage


Remaining


AggregateExercise


Contractual


IntrinsicShares


Price


Term


ValueOutstanding at January 3, 2009


311,262


$
11.69Granted


5,200


$
1.20Forfeited/cancelled


(41,850
)

$
10.10Outstanding at January 2, 2010


274,612


$
11.74



6.7 years


$
1,000Options vested and expected to be vested at January 2, 2010


237,028


$
11.98



6.6 years


$
1,000Options exercisable at January 2, 2010


160,662


$
12.90



5.9 years  49




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    EMPLOYEE
    STOCK PURCHASE PLAN
    7.
    BUSINESS
    SEGMENTS, MAJOR CUSTOMERS AND SIGNIFICANT GROUP CONCENTRATIONS
    OF CREDIT RISK  280-10,
   50




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Management



NotConsulting

Software

Allocated toServices

Solutions

Segments

TotalAs of and for the fiscal year ended January 2, 2010:Revenues

$
50,584


$
14,369






$
64,953Income (loss) from operations


12,464



934


$
(16,953
)


(3,555
)Interest income










259



259Interest expense










(55
)


(55
)Income (loss) before income tax provision


12,464



934



(16,414
)


(3,016
)Depreciation and amortization










3,379



3,379Total assets

$
11,515


$
4,650


$
32,086


$
48,251As of and for the fiscal year ended January 3, 2009:Revenues

$
54,086


$
19,956






$
74,042Income (loss) from operations


17,292



4,347


$
(37,143
)


(15,504
)Interest Income










922



922Income (loss) before income tax provision


17,292



4,347



(36,470
)


(14,831
)Depreciation and amortization










5,385



5,385Total assets

$
8,728


$
4,078


$
33,908


$
46,714     280-10,
  Revenue


Loss Before Income Tax ProvisionFiscal Year


Fiscal Year


Fiscal Year


Fiscal Year2009


2008


2009


2008United States

$
46,206


$
46,096


$
(2,145
)

$
(9,233
)International:United Kingdom


16,727



26,163



(777
)


(5,241
)Other


2,020



1,783



(94
)


(357
)Total

$
64,953


$
74,042


$
(3,016
)

$
(14,831
)  51




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    RevenuesFiscal Year 2009

Fiscal Year 2008Management



ManagementConsulting

Software

Consulting

SoftwareServices

Solutions

Services

SolutionsCustomer A

$
3,451


$
3,967


$
4,413


$
6,284Customer B

$
22,789






$
21,032Customer C

$
8,935






$
6,564Customer D

$
6,612






$
5,731   Accounts ReceivableJanuary 2,

January 3,2010

2009Customer A

$
3,244


$
2,545Customer B

$
4,333


$
2,343Customer C

$
1,290


$
1,215Customer D

$
1,640


$
1,482       8.
    PROPERTY
    AND EQUIPMENT  January 2,


January 3,2010


2009(In thousands)Furniture and fixtures

$
1,450


$
1,400Software and computer equipment


3,784



2,992Leasehold improvements


1,199



1,1246,433



5,516Less: Accumulated depreciation and amortization


4,478



3,715$
1,955


$
1,801    52




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##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   9.
    INCOME
    TAXES    Fiscal


FiscalYear


Year2009


2008FederalCurrent tax (expense) benefit

$
(32
)

$
(32
)Deferred tax (expense) benefit, net


(103
)(135
)


(32
)StateCurrent tax (expense) benefit


(34
)Deferred tax (expense) benefit, net


(15
)(49
)ForeignCurrent tax (expense) benefit


(15
)


(1,039
)Deferred tax (expense) benefit, net


(27
)


1,077(42
)


38Total

$
(226
)

$
6       Fiscal Year 2009


Fiscal Year 2008Amount


%


Amount


%Computed expected federal income tax benefit

$
1,056



35.0


$
5,191



35.0State income tax (expense) benefit, net of federal benefit


(44
)


(1.4
)


744



5.0Rate differential on foreign operations


(243
)


(8.1
)


(58
)


(0.4
)Forfeited vested stock options


(883
)


(29.3
)


299



2.0Adjustment to estimated tax loss carryforward


(985
)


(32.7
)


(552
)


(3.7
)Other


(52
)


(1.7
)


(104
)


(0.7
)Foreign tax credit carryforward


56



1.8



(1,738
)


(11.7
)Change in valuation allowance


869



28.9



(3,776
)


(25.5
)Total

$
(226
)


(7.5
)

$
6



0.0  53




---



##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Fiscal


FiscalYear


Year2009


2008Goodwill and intangible assets

$
(1,931
)

$
5,698Share-based compensation expense


(761
)


1,019Valuation allowance


869



(3,776
)Net operating loss carryforward


(275
)


(51
)Undistributed foreign earnings


1,185



(1,185
)Foreign tax credit carryforward


750



317Accrued contingent consideration






(353
)Other


18



(592
)Total

$
(145
)

$
1,077     January 2,


January 3,2010


2009Current deferred tax assets (liabilities):Unfavorable liabilities

$
286


$
274Other


132



336Valuation allowance


(418
)


(496
)Current deferred tax asset

$
0


$
114Non-current deferred tax assets (liabilities):Goodwill and intangible assets

$
11,541


$
13,541Share-based compensation expense


2,126



2,822Net operating loss carryforward


17,343



17,514Auction rate securities


182



561Other


678



339Undistributed foreign earnings






(1,185
)Foreign tax credit carryforward


1,067



317Valuation allowance


(33,055
)


(34,024
)Non-current deferred tax liabilities

$
(118
)

$
(115
)  54




---



##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Amount


Year$
2,177



20165,602



20239,094



20247,432



20259,854



20265,152



20271,637



2028Total

$
40,948           January 2,


January 3,2010


2009(In thousands)Gross unrecognized tax benefits at beginning of year

$
690


$
355Gross increases in tax positions for current year


40



335Gross unrecognized tax benefits at end of year

$
730


$
690    55




---



##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  non-U.S. income
  10.
    LEASE
    COMMITMENTS      OperatingFiscal Year

Leases2010

$
2,8842011


1,3682012


1,5032013


3912014 and thereafter


912Total minimum lease payments


7,058Future minimum rentals to be received under non-cancellable
    subleases


(628
)Minimum lease payments net of amounts to be received under
    subleases

$
6,430     January 2,


January 3,2010


2009Current unfavorable lease obligations

$
706


$
681Non-current unfavorable lease obligations


61



773$
767


$
1,454     11.
    LOAN TO
    OFFICER   56




---



##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  12.
    LETTER OF
    CREDIT    13.
    RELATED
    PARTY TRANSACTIONS    14.
    COMMITMENTS
    AND CONTINGENCIES      15.
    SHARE
    REPURCHASE PROGRAM     57




---



##### Table of Contents



THE
    MANAGEMENT NETWORK GROUP, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Treasury SharesBalance as of December 29, 2007


40,000Purchases of treasury stock


400,000Balance as of January 3, 2009 and January 2, 2010


440,000   16.
    EMPLOYEE
    BENEFIT PLAN    17.
    SUBSEQUENT
    EVENTS  Borrowing
    on UBS Line of Credit
   58




---



##### Table of Contents



ITEM 9.  CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE
    ITEM 9A(T).
    CONTROLS
    AND PROCEDURES  Evaluation
    of Disclosure Controls and Procedure
  13a-15(e) 15d-15(e)
    Managements
    Report on Internal Control over Financial
    Reporting
  Internal Control
     Integrated Framework,
    Changes
    in Internal Control over Financial Reporting
    ITEM 9B.
    OTHER
    INFORMATION   59




---



##### Table of Contents



PART III  ITEM 10.
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE  Form 10-K,
  ITEM 11.
    EXECUTIVE
    COMPENSATION  Form 10-K,
  ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS  Form 10-K,
  EQUITY
    COMPENSATION PLAN INFORMATION
  (c)(a)





Number of SecuritiesNumber of


(b)


Remaining AvailableSecurities to be Issued


Weighted Average


for Future IssuanceUpon Exercise of


Exercise Price of


Under Equity CompensationOutstanding Options,


Outstanding Options,


Plans (Excluding SecuritiesWarrants and Rights


Warrants and Rights


Reflected in Column (a))(1)PLANS APPROVED BY SECURITY HOLDERS(1) 1998 Equity Incentive Plan


763,547


$
17.57



18,240PLANS NOT APPROVED BY SECURITY HOLDERS 2000 Supplemental Stock Plan


274,612


$
11.74



281,946     (1)
    
    The amounts in the table do not include up to 71,911 shares
    that may be purchased under the 1999 Employee Stock Purchase
    Plan or 1,250 shares subject to outstanding unvested
    restricted stock awards.    ITEM 13.
    CERTAIN
    RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR
    INDEPENDENCE  Form 10-K,
  ITEM 14.
    PRINCIPAL
    ACCOUNTANT FEES AND SERVICES  Form 10-K,
 60




---



##### Table of Contents



PART IV  ITEM 15.
    EXHIBITS,
    FINANCIAL STATEMENT SCHEDULES  10-K:
      Form 10-K.
 61




---



##### Table of Contents



SIGNATURES
  Form 10-K
  THE MANAGEMENT NETWORK GROUP, INC.
  By:
    /s/  RICHARD
    P. NESPOLA        POWER OF
    ATTORNEY
  Form 10-K,
  Form 10-K
  Signature

Title

Date/s/  RICHARD
    P. NESPOLARichard
    P. Nespola

Chairman of the Board and Chief Executive Officer (Principal
    executive officer)

April 1, 2010/s/  DONALD
    E. KLUMBDonald
    E. Klumb

Chief Financial Officer and Treasurer (Principal financial
    officer and principal accounting officer)

April 1, 2010/s/  MICKY
    K. WOOMicky
    K. Woo

Director

April 1, 2010/s/  ANDREW
    LIPMANAndrew
    Lipman

Director

April 1, 2010/s/  ROBERT
    J. CURREYRobert
    J. Currey

Director

April 1, 2010/s/  ROY
    A. WILKENSRoy
    A. Wilkens

Director

April 1, 2010/s/  FRANK
    SISKOWSKIFrank
    Siskowski

Director

April 1, 2010  62




---



##### Table of Contents



INDEX TO
    EXHIBITS
    ExhibitNumber

Description of Document3
.1

Amended and Restated Certificate of Incorporation, filed as
    Exhibit 3.1 to the Companys
    Form 8-K
    filed with the Securities and Exchange Commission on
    February 5, 2010, is incorporated herein by reference as
    Exhibit 3.1.3
.2

Certificate of Designations of Series A Junior
    Participating Preferred Stock, as filed with the Secretary of
    State of Delaware on March 27, 2008, filed as
    Exhibit 3.1 to the Companys Current Report on
    Form 8-K
    dated March 27, 2008 filed with the Securities and Exchange
    Commission, is incorporated herein by reference as
    Exhibit 3.2.3
.3

Amended and Restated By-laws, filed as Exhibit 3.2 to the
    Companys
    Form 8-K
    filed with the Securities and Exchange Commission on
    April 20, 2009, is incorporated herein by reference as
    Exhibit 3.3.4
.1

Specimen Common Stock Certificate, filed as Exhibit 4.1 to
    the Registration Statement on
    Form S-1
    originally filed September 20, 1999 (Registration
    No. 333-87383),
    as amended (the 1999
    S-1
    Registration Statement), is incorporated herein by
    reference as Exhibit 4.1.4
.2

Registration Rights Agreement, dated February 12, 1998,
    among the Company and certain holders of the Companys
    common stock (the Registration Rights Agreement),
    filed as Exhibit 10.1 to the 1999
    S-1
    Registration Statement, is incorporated herein by reference as
    Exhibit 4.2.4
.3

Rights Agreement, dated as of March 27, 2008, by and
    between the Company and Computershare Trust Company N.A.,
    filed as Exhibit 4.1 to the Companys Current Report
    on
    Form 8-K
    dated March 27, 2008 filed with the Securities and Exchange
    Commission, is incorporated herein by reference as
    Exhibit 4.3.4
.4

Form of Rights Certificate, filed as Exhibit B to the
    Rights Agreement filed as Exhibit 4.1 to the Companys
    Current Report on
    Form 8-K
    dated March 27, 2008, filed with the Securities and
    Exchange Commission, is incorporated herein by reference as
    Exhibit 4.4.10
.1

Registration Rights Agreement. (See Exhibit 4.2).10
.2

Form of Indemnification Agreement between the Company and each
    of its Directors and Officers, filed as Exhibit 10.2 to the
    1999 S-1
    Registration Statement, is incorporated herein by reference as
    Exhibit 10.2.(1)10
.3

Amended and Restated 1998 Equity Incentive Plan, as amended and
    restated on June 8, 2009, filed as Appendix B to the
    definitive proxy statement of the Company filed with the
    Securities and Exchange Commission on May 4, 2009, and the
    Form of Agreements thereunder, filed in Exhibit 10.3 to the
    1999 S-1
    Registration Statement, are incorporated herein by reference as
    Exhibit 10.3.(1)10
.4

1999 Employee Stock Purchase Plan filed as Appendix A to
    the definitive proxy statement of the Company filed with the
    Securities and Exchange Commission on May 4, 2009,and the
    Form of Agreements thereunder, filed in Exhibit 10.4 to the
    1999 S-1
    Registration Statement, are incorporated herein by reference as
    Exhibit 10.4.(1)10
.5

2000 Supplemental Stock Plan and Form of Agreements thereunder,
    filed as Exhibit 10.16 to the Companys
    Form 10-K
    for the fiscal year ended December 30, 2000, is
    incorporated herein by reference as Exhibit 10.5.(1)10
.6

Employment Agreement between the Company and Richard Nespola,
    dated January 5, 2004, filed as Exhibit 10.19 to the
    Companys
    Form 10-K
    for the fiscal year ended January 3, 2004, is incorporated
    herein by reference as Exhibit 10.6.(1)10
.7

Sublease between Best Doctors, Inc. and Cambridge Strategic
    Management Group Inc. (formerly TMNG Strategy, Inc.), dated
    December 30, 2004, filed as Exhibit 10.21 to the
    Companys
    Form 10-K
    for the fiscal year ended January 1, 2005, is incorporated
    herein by reference as Exhibit 10.7.10
.8

Asset Purchase Agreement, dated April 2, 2006, among
    Wilbass Limited, Adventis Limited, and Adventis Corporation,
    filed as Exhibit 10 to the Companys
    Form 10-Q
    for the quarter ended April 1, 2006, is incorporated herein
    by reference as Exhibit 10.8.** 63




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##### Table of Contents



ExhibitNumber

Description of Document10
.9

Share Purchase Agreement, dated December 22, 2006, between
    the Company and Janos Sivo, Alan Strong, William Hill and James
    Baker, regarding the acquisition of the outstanding common stock
    of Cartesian Limited, filed as Exhibit 10.1 to the
    Companys
    Form 10-Q
    for the quarter ended September 30, 2006, is incorporated
    herein by reference as Exhibit 10.9.10
.10

Third Amended Lease Agreement between NewTower
    Trust Company Multi-Employer Property Trust and the
    Company, dated August 30, 2005, filed as Exhibit 10.10
    to the Companys
    Form 10-K
    for the fiscal year ended December 30, 2006, is
    incorporated herein by reference as Exhibit 10.10.10
.11

Third Additional Space Commencement Date Agreement between
    NewTower Trust Company Multi-Employer Property Trust and
    the Company, dated February 28, 2006, filed as
    Exhibit 10.11 to the Companys
    Form 10-K
    for the fiscal year ended December 30, 2006, is
    incorporated herein by reference as Exhibit 10.11.10
.12

Membership Interest Purchase Agreement, dated July 30,
    2007, between the Company and RVA Consulting, LLC, RVA Holdings,
    LLC, Mark Markowitz, Dawn Saitta, and Dale Reynolds, regarding
    the acquisition of all outstanding membership interests in RVA
    Consulting, LLC, filed as Exhibit 10.1 to the
    Companys
    Form 10-Q
    for the quarter ended June 30, 2007, is incorporated herein
    by reference as Exhibit 10.12.**10
.13

Stock Purchase Agreement, dated October 5, 2007, between
    the Company and TWG Consulting, Inc. and Marilyn Breitenstein,
    regarding the acquisition of the outstanding common stock of TWG
    Consulting, Inc., filed as Exhibit 2.1 to the
    Companys
    Form 10-Q
    for the quarter ended September 29, 2007, is incorporated
    herein by reference as Exhibit 10.13.10
.14

Transition Services Agreement among RVA Consulting, LLC, a
    subsidiary of the Company, and Publicis Selling Solutions, Inc,
    filed as Exhibit 10.1 to the Companys
    Form 10-Q
    for the quarter ended September 29, 2007, is incorporated
    herein by reference as Exhibit 10.14.10
.15

Lease Agreement between Cartesian Limited and Sun Life Assurance
    Company of Canada (U.K.) Limited, dated November 23, 2000,
    filed as Exhibit 10.1 to the Companys
    Form 10-Q
    for the quarter ended March 31, 2007, is incorporated
    herein by reference as Exhibit 10.15.10
.16

Fourth Amendment to Lease between NewTower Trust Company
    Multi-Employer Property Trust and the Company, dated
    July 10, 2007, filed as Exhibit 10.16 to the
    Companys
    Form 10-K
    for the fiscal year ended December 27, 2007, is
    incorporated herein by reference as Exhibit 10.16.10
.17

Employment Agreement dated April 8, 2008 between The
    Management Network Group, Inc. and Donald E. Klumb, filed as
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    April 11, 2008, is incorporated herein by reference as
    Exhibit 10.17.(1)10
.18

The Management Network Group, Inc. 2008 Executive Incentive
    Compensation Plan, filed as Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    February 25, 2008, is incorporated herein by reference as
    Exhibit 10.18.(1)10
.19

Fifth Amendment to Lease between NewTower Trust Company
    Multi-Employer Property Trust and the Company, dated
    May 19, 2008, filed as Exhibit 10.1 to the
    Companys
    Form 10-Q
    for the quarter ended June 28, 2008, is incorporated herein
    by reference as Exhibit 10.19.10
.20

Stock Purchase Agreement by and among the Company, Potomac
    Capital International Ltd., Potomac Capital Partners LP,
    Pleiades Investment Partners-R LP, Potomac Capital Management
    LLC, Potomac Capital Management, Inc. and Paul J. Solit dated
    June 11, 2008 filed as Exhibit 10.1 to the
    Companys
    Form 8-K
    filed with the Securities and Exchange Commission on
    June 12, 2008, is incorporated herein by reference as
    Exhibit 10.20.10
.21

Stock Purchase Agreement by and among Riley Investment Partners
    Master Fund, L.P., Riley Investment Management, LLC., and Bryant
    R. Riley dated June 12, 2008 filed as Exhibit 10.2 to
    the Companys
    Form 8-K
    dated June 12, 2008, filed with the Securities and Exchange
    Commission, 2008, is incorporated herein by reference as
    Exhibit 10.21. 64




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##### Table of Contents



ExhibitNumber

Description of Document10
.22

Standstill Agreement by and among the Company, Potomac Capital
    International Ltd., Potomac Capital Partners LP, Pleiades
    Investment Partners-R LP, Potomac Capital Management LLC,
    Potomac Capital Management, Inc. and Paul J. Solit dated
    June 11, 2008 filed as Exhibit 10.3 to the
    Companys
    Form 8-K
    dated June 12, 2008, filed with the Securities and Exchange
    Commission, is incorporated herein by reference as
    Exhibit 10.22.10
.23

Standstill Agreement by and among Riley Investment Partners
    Master Fund, L.P., Riley Investment Management, LLC., and Bryant
    R. Riley dated June 12, 2008 filed as Exhibit 10.4 to
    the Companys
    Form 8-K
    dated June 12, 2008, filed with the Securities and Exchange
    Commission, 2008, is incorporated herein by reference as
    Exhibit 10.23.10
.24

Offering Letter Relating to the Auction Rate Securities
    Settlement with The Management Network Group, Inc. dated as of
    October 8, 2008, issued by UBS Financial Services Inc.;
    Acceptance Form filed as Exhibit 99.1 to the Companys
    Form 8-K
    dated November 19, 2008, filed with the Securities and
    Exchange Commission, is incorporated herein by reference as
    Exhibit 10.24.10
.25

Credit Line Account Application and Agreement for Organizations
    and Businesses dated as of November 13, 2008, between The
    Management Network Group, Inc. and UBS Bank USA filed as
    Exhibit 99.2 to the Companys
    Form 8-K
    dated November 19, 2008, filed with the Securities and
    Exchange Commission, is incorporated herein by reference as
    Exhibit 10.25.10
.26

Addendum to Credit Line Account Application and Agreement dated
    as of November 13, 2008, between The Management Network
    Group, Inc. and UBS Bank USA filed as Exhibit 99.3 to the
    Companys
    Form 8-K
    dated November 19, 2008, filed with the Securities and
    Exchange Commission, is incorporated herein by reference as
    Exhibit 10.26.10
.27

Important Notice on Interest Rates and Payments dated as of
    November 13, 2008, between The Management Network Group,
    Inc. and UBS Bank USA filed as Exhibit 99.4 to the
    Companys
    Form 8-K
    dated November 19, 2008, filed with the Securities and
    Exchange Commission, is incorporated herein by reference as
    Exhibit 10.27.21
.1

List of subsidiaries of the Company, prepared pursuant to
    Item 601(b)(21) of
    Regulation S-K
    is attached to this
    Form 10-K
    as Exhibit 21.1.23
.1

Consent of independent registered public accounting firm is
    attached to this
    Form 10-K
    as Exhibit 23.1.24
.1

Power of attorney (see signature page).31
.1

Certification of Chief Executive Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002 is attached
    to this
    Form 10-K
    as Exhibit 31.1.31
.2

Certification of Chief Financial Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002 is attached
    to this
    Form 10-K
    as Exhibit 31.2.32
.1

Certifications furnished pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002 are attached to this
    Form 10-K
    as Exhibit 32.1.     (1)
    
    Management contracts and compensatory plans and arrangements
    required to be filed as Exhibits pursuant to Item 15 of
    this report.  **
    
    Portions of this document have been redacted pursuant to a
    Request for Confidential Treatment filed with the Securities and
    Exchange Commission pursuant to
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended. Redacted
    portions are indicated with the notation [***]. 65