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<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>1.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>DESCRIPTION OF THE COMPANY</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Richardson Electronics, Ltd. is a leading
global provider of engineered solutions, power grid and microwave tubes and related consumables; power conversion and RF and microwave
components; high value flat panel detector solutions, replacement parts, tubes and service training for diagnostic imaging equipment;
and customized display solutions. We serve customers in the alternative energy, healthcare, aviation, broadcast, communications,
industrial, marine, medical, military, scientific and semiconductor markets. The Company’s strategy is to provide specialized
technical expertise and “engineered solutions” based on our core engineering and manufacturing capabilities. The Company
provides solutions and adds value through design-in support, systems integration, prototype design and manufacturing, testing,
logistics, and aftermarket technical service and repair through its global infrastructure.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our products include electron tubes and
related components, microwave generators, subsystems used in semiconductor manufacturing, and visual technology solutions. These
products are used to control, switch or amplify electrical power signals, or are used as display devices in a variety of industrial,
commercial, medical, and communication applications.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have three operating and reportable segments,
which we define as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Power and Microwave Technologies Group (“PMT”)
combines our core engineered solutions, power grid and microwave tube business with new RF and power technologies. As a manufacturer
and authorized distributor, PMT’s strategy is to provide specialized technical expertise and engineered solutions based on
our core engineering and manufacturing capabilities. We provide solutions and add value through design-in support, systems integration,
prototype design and manufacturing, testing, logistics, and aftermarket technical service and repair—all through our existing
global infrastructure. PMT’s focus is on products for power, RF and microwave applications for customers in alternative energy,
aviation, broadcast, communications, industrial, marine, medical, military, scientific, and semiconductor markets. PMT focuses
on various applications including broadcast transmission, CO2 laser cutting, diagnostic imaging, dielectric and induction heating,
high energy transfer, high voltage switching, plasma, power conversion, radar, and radiation oncology. PMT also offers its customers
technical services for both microwave and industrial equipment.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Canvys provides customized display solutions
serving the corporate enterprise, financial, healthcare, industrial, and medical original equipment manufacturers (“OEM”)
markets.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Healthcare manufactures, refurbishes and
distributes high value replacement parts for the healthcare market including hospitals, medical centers, asset management companies,
independent service organizations, and multi-vendor service providers. Products include Diagnostic Imaging replacement parts including
CT and MRI tubes, hydrogen thyratrons, klystrons, magnetrons; replacement flat panel detectors and upgrades; and additional replacement
components currently under development for the diagnostic imaging service market. Through a combination of newly developed products
and partnerships, service offerings, and training programs, we believe we can help our customers improve efficiency and deliver
better clinical outcomes while lowering the cost of healthcare delivery.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We currently have operations in the following
major geographic regions: North America, Asia/Pacific, Europe, and Latin America.</p>
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<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The accompanying unaudited consolidated
financial statements have been prepared in accordance with United States Generally Accepted Accounting Principles (“GAAP”)
for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not
include all the information and notes required by GAAP for complete financial statements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our fiscal quarter ends on the Saturday
nearest the end of the quarter-ending month. The first three months of fiscal 2018 and 2017 contained 14 and 13 weeks, respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In the opinion of management, all adjustments,
which are of a normal and recurring nature, necessary for a fair presentation of the results of interim periods have been made.
All inter-company transactions and balances have been eliminated. The unaudited consolidated financial statements presented herein
include the accounts of our wholly owned subsidiaries. Certain information and note disclosures normally included in financial
statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The results
of our operations for the three months ended September 2, 2017, are not necessarily indicative of the results that may be expected
for the fiscal year ending June 2, 2018.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The financial information contained in this
report should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended May 27, 2017, that we filed
on July 31, 2017.</p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; text-align: justify; font: 10pt Times New Roman, Times, Serif"><td style="width: 0; font: 10pt Times New Roman, Times, Serif"></td><td style="width: 0.25in; text-align: left; font: 10pt Times New Roman, Times, Serif"><b>3.</b></td><td style="text-align: justify; font: 10pt Times New Roman, Times, Serif"><b>CRITICAL ACCOUNTING POLICIES AND ESTIMATES</b></td>
</tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-indent: -0.25in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Inventories, net: </b>Our consolidated
inventories are stated at the lower of cost or market, generally using a weighted-average cost method. Our net inventories include
approximately $38.6 million of finished goods, $5.7 million of raw materials and $1.8 million of work-in-progress as of September
2, 2017, as compared to approximately $36.0 million of finished goods, $5.3 million of raw materials and $1.4 million of work-in-progress
as of May 27, 2017.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At this time, we do not anticipate any material
risks or uncertainties related to possible future inventory write-downs. Provisions for obsolete or slow moving inventories are
recorded based upon regular analysis of stock rotation privileges, obsolescence, the exiting of certain markets and assumptions
about future demand and market conditions. If future demand changes in the industry, or market conditions differ from management’s
estimates, additional provisions may be necessary. Inventory reserves were approximately $3.6 million as of September 2, 2017 and
$3.5 million as of May 27, 2017.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Revenue Recognition: </b>Our product
sales are recognized as revenue upon shipment, when title passes to the customer, when delivery has occurred or services have been
rendered and when collectability is reasonably assured. We also record estimated discounts and returns based on our historical
experience. Our products are often manufactured to meet the specific design needs of our customers’ applications. Our engineers
work closely with customers to ensure that our products will meet their needs. Our customers are under no obligation to compensate
us for designing the products we sell.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In May 2014, the Financial Accounting Standards
Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”), Revenue
from Contracts with Customers, which amends guidance for revenue recognition. ASU 2014-09 is principles based guidance that can
be applied to all contracts with customers, enhancing comparability of revenue recognition practices across entities, industries,
jurisdictions and capital markets. The core principle of the guidance is that entities should recognize revenue to depict the transfer
of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled
in exchange for those goods and services. The guidance details the steps entities should apply to achieve the core principle. In
August 2015, the FASB issued an amendment to defer the effective date for all entities by one year. For public entities, ASU 2014-09
is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period.
Early adoption is permitted as of annual reporting periods beginning after December 15, 2016. Companies have the option of using
either a full or modified retrospective approach in applying this standard. During fiscal 2016 and 2017, the FASB issued four additional
updates which further clarify the guidance provided in ASU 2014-09.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are evaluating the impact of the new
standard on our financial statements using a three-phase approach (assessment, conversion and implementation). We are significantly
through our assessment phase. However, further evaluation is needed in order to determine whether or not the new revenue recognition
standard will have a material impact on our financial statements and related disclosures upon adoption. We expect to finalize the
assessment phase in the second quarter of fiscal year 2018. We will complete the conversion and implementation phases by the end
of fiscal year 2018 in conjunction with future interpretative guidance.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Loss Contingencies: </b>We accrue a liability
for loss contingencies when it is probable that a liability has been incurred and the amount can be reasonably estimated. When
only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range
is a better estimate than any other amount within the range, the minimum amount in the range is accrued. If we determine that there
is at least a reasonable possibility that a loss may have been incurred, we will include a disclosure describing the contingency.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Intangible Assets: </b>Intangible assets
are initially recorded at their fair market values determined on quoted market prices in active markets, if available, or recognized
valuation models. Intangible assets that have finite useful lives are amortized over their useful lives either on a straight-line
basis or over their projected future cash flows and are tested for impairment when events or changes in circumstances occur that
indicate possible impairment.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Income Taxes: </b>We recognize deferred
tax assets and liabilities based on the differences between financial statement carrying amounts and the tax bases of assets and
liabilities. We regularly review our deferred tax assets for recoverability and determine the need for a valuation allowance based
on a number of factors, including both positive and negative evidence. These factors include historical taxable income or loss,
projected future taxable income or loss, the expected timing of the reversals of existing temporary differences and the implementation
of tax planning strategies. In circumstances where we, or any of our affiliates, have incurred three years of cumulative losses
which constitute significant negative evidence, positive evidence of equal or greater significance is needed to overcome the negative
evidence before a tax benefit is recognized for deductible temporary differences and loss carryforwards.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In March 2016, the FASB issued ASU No.
2016-09, “<i>Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”,
</i>a new accounting standard update intended to simplify several aspects of the accounting for share-based payment transactions
including: income tax consequences, classification of awards as either equity or liabilities and classification on the statement
of cash flows. Specifically, the update requires that excess tax benefits and tax deficiencies (the difference between the deduction
for tax purposes and the compensation cost recognized for financial reporting purposes) be recognized as income tax expense or
benefit in the consolidated statements of comprehensive income (loss), introducing a new element of volatility to the provision
for income taxes. This update is effective for fiscal years beginning after December 15, 2016. Early adoption is permitted. The
Company adopted the ASU on May 28, 2017. Effective with the adoption of the ASU all share-based awards continue to be accounted
for as equity awards, excess tax benefits recognized on stock-based compensation expense are reflected in the consolidated statements
of comprehensive income (loss) as a component of the provision for income taxes on a prospective basis, excess tax benefits recognized
on stock-based compensation expense are classified as an operating activity in the consolidated statements of cash flows on a
prospective basis and the Company has elected to continue to estimate expected forfeitures over the course of a vesting period.
The adoption of the ASU had no impact on the retained earnings, other components of equity or net assets as of the beginning of
the period of adoption. </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Accrued Liabilities: </b>Accrued liabilities
consist of the following (<i>in thousands</i>):</p>
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<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>September 2, 2017</b></td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>May 27, 2017</b></td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Compensation and payroll taxes</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">3,421</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">3,250</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Accrued severance (1)</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">485</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">706</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Professional fees</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">455</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">535</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Deferred revenue</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,907</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,460</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Other accrued expenses</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF; text-align: right">2,905</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF; text-align: right">2,360</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Accrued Liabilities</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif"><b>$</b></td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><b>9,173</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif"><b>$</b></td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><b>8,311</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(1) In the second quarter of fiscal year
2017, the Company executed a reduction in headcount to streamline operations and reduce costs and recorded $1.3 million of expense
included in selling, general and administrative expenses for employee termination costs payable to terminated employees with employment
and/or separation agreements with the Company. The changes in the severance accrual for the first three months of fiscal year 2018
included payments of $0.2 million.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Inventories, net: </b>Our consolidated
inventories are stated at the lower of cost or market, generally using a weighted-average cost method. Our net inventories include
approximately $38.6 million of finished goods, $5.7 million of raw materials and $1.8 million of work-in-progress as of September
2, 2017, as compared to approximately $36.0 million of finished goods, $5.3 million of raw materials and $1.4 million of work-in-progress
as of May 27, 2017.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">At this time, we do not anticipate any material
risks or uncertainties related to possible future inventory write-downs. Provisions for obsolete or slow moving inventories are
recorded based upon regular analysis of stock rotation privileges, obsolescence, the exiting of certain markets and assumptions
about future demand and market conditions. If future demand changes in the industry, or market conditions differ from management’s
estimates, additional provisions may be necessary. Inventory reserves were approximately $3.6 million as of September 2, 2017 and
$3.5 million as of May 27, 2017.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Revenue Recognition: </b>Our product
sales are recognized as revenue upon shipment, when title passes to the customer, when delivery has occurred or services have been
rendered and when collectability is reasonably assured. We also record estimated discounts and returns based on our historical
experience. Our products are often manufactured to meet the specific design needs of our customers’ applications. Our engineers
work closely with customers to ensure that our products will meet their needs. Our customers are under no obligation to compensate
us for designing the products we sell.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In May 2014, the Financial Accounting Standards
Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”), Revenue
from Contracts with Customers, which amends guidance for revenue recognition. ASU 2014-09 is principles based guidance that can
be applied to all contracts with customers, enhancing comparability of revenue recognition practices across entities, industries,
jurisdictions and capital markets. The core principle of the guidance is that entities should recognize revenue to depict the transfer
of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled
in exchange for those goods and services. The guidance details the steps entities should apply to achieve the core principle. In
August 2015, the FASB issued an amendment to defer the effective date for all entities by one year. For public entities, ASU 2014-09
is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period.
Early adoption is permitted as of annual reporting periods beginning after December 15, 2016. Companies have the option of using
either a full or modified retrospective approach in applying this standard. During fiscal 2016 and 2017, the FASB issued four additional
updates which further clarify the guidance provided in ASU 2014-09.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are evaluating the impact of the new
standard on our financial statements using a three-phase approach (assessment, conversion and implementation). We are significantly
through our assessment phase. However, further evaluation is needed in order to determine whether or not the new revenue recognition
standard will have a material impact on our financial statements and related disclosures upon adoption. We expect to finalize the
assessment phase in the second quarter of fiscal year 2018. We will complete the conversion and implementation phases by the end
of fiscal year 2018 in conjunction with future interpretative guidance.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Loss Contingencies: </b>We accrue a liability
for loss contingencies when it is probable that a liability has been incurred and the amount can be reasonably estimated. When
only a range of possible loss can be established, the most probable amount in the range is accrued. If no amount within this range
is a better estimate than any other amount within the range, the minimum amount in the range is accrued. If we determine that there
is at least a reasonable possibility that a loss may have been incurred, we will include a disclosure describing the contingency.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Intangible Assets: </b>Intangible assets
are initially recorded at their fair market values determined on quoted market prices in active markets, if available, or recognized
valuation models. Intangible assets that have finite useful lives are amortized over their useful lives either on a straight-line
basis or over their projected future cash flows and are tested for impairment when events or changes in circumstances occur that
indicate possible impairment.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Income Taxes: </b>We recognize deferred
tax assets and liabilities based on the differences between financial statement carrying amounts and the tax bases of assets and
liabilities. We regularly review our deferred tax assets for recoverability and determine the need for a valuation allowance based
on a number of factors, including both positive and negative evidence. These factors include historical taxable income or loss,
projected future taxable income or loss, the expected timing of the reversals of existing temporary differences and the implementation
of tax planning strategies. In circumstances where we, or any of our affiliates, have incurred three years of cumulative losses
which constitute significant negative evidence, positive evidence of equal or greater significance is needed to overcome the negative
evidence before a tax benefit is recognized for deductible temporary differences and loss carryforwards.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In March 2016, the FASB issued ASU No.
2016-09, “<i>Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”,
</i>a new accounting standard update intended to simplify several aspects of the accounting for share-based payment transactions
including: income tax consequences, classification of awards as either equity or liabilities and classification on the statement
of cash flows. Specifically, the update requires that excess tax benefits and tax deficiencies (the difference between the deduction
for tax purposes and the compensation cost recognized for financial reporting purposes) be recognized as income tax expense or
benefit in the consolidated statements of comprehensive income (loss), introducing a new element of volatility to the provision
for income taxes. This update is effective for fiscal years beginning after December 15, 2016. Early adoption is permitted. The
Company adopted the ASU on May 28, 2017. Effective with the adoption of the ASU all share-based awards continue to be accounted
for as equity awards, excess tax benefits recognized on stock-based compensation expense are reflected in the consolidated statements
of comprehensive income (loss) as a component of the provision for income taxes on a prospective basis, excess tax benefits recognized
on stock-based compensation expense are classified as an operating activity in the consolidated statements of cash flows on a
prospective basis and the Company has elected to continue to estimate expected forfeitures over the course of a vesting period.
The adoption of the ASU had no impact on the retained earnings, other components of equity or net assets as of the beginning of
the period of adoption. </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b>Accrued Liabilities: </b>Accrued liabilities
consist of the following (<i>in thousands</i>):</p>
<table cellspacing="0" cellpadding="0" align="center" style="font: 10pt Times New Roman, Times, Serif; width: 95%; border-collapse: collapse">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="width: 69%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>September 2, 2017</b></td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>May 27, 2017</b></td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Compensation and payroll taxes</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">3,421</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">3,250</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Accrued severance (1)</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">485</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">706</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Professional fees</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">455</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">535</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Deferred revenue</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,907</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,460</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Other accrued expenses</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF; text-align: right">2,905</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF; text-align: right">2,360</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Accrued Liabilities</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif"><b>$</b></td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><b>9,173</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif"><b>$</b></td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><b>8,311</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(1) In the second quarter of fiscal year
2017, the Company executed a reduction in headcount to streamline operations and reduce costs and recorded $1.3 million of expense
included in selling, general and administrative expenses for employee termination costs payable to terminated employees with employment
and/or separation agreements with the Company. The changes in the severance accrual for the first three months of fiscal year 2018
included payments of $0.2 million.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><b></b>Accrued liabilities
consist of the following (<i>in thousands</i>):</p>
<table cellspacing="0" cellpadding="0" align="center" style="font: 10pt Times New Roman, Times, Serif; width: 95%; border-collapse: collapse">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="width: 69%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>September 2, 2017</b></td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>May 27, 2017</b></td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Compensation and payroll taxes</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">3,421</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">3,250</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Accrued severance (1)</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">485</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">706</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Professional fees</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">455</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="background-color: #CCECFF; text-align: right; font: 10pt Times New Roman, Times, Serif">535</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Deferred revenue</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,907</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,460</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">Other accrued expenses</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF; text-align: right">2,905</td>
<td style="background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; background-color: #CCECFF; text-align: right">2,360</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Accrued Liabilities</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif"><b>$</b></td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><b>9,173</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif"><b>$</b></td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><b>8,311</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(1) In the second quarter of fiscal year
2017, the Company executed a reduction in headcount to streamline operations and reduce costs and recorded $1.3 million of expense
included in selling, general and administrative expenses for employee termination costs payable to terminated employees with employment
and/or separation agreements with the Company. The changes in the severance accrual for the first three months of fiscal year 2018
included payments of $0.2 million.</p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>4.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>GOODWILL AND INTANGIBLE ASSETS</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The carrying value of goodwill was $6.3
million as of September 2, 2017 and May 27, 2017.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Goodwill is initially recorded based on
the premium paid for acquisitions and is subsequently tested for impairment, using the first day of our fourth quarter as the measurement
date. We test goodwill for impairment annually and whenever events or circumstances indicates an impairment may have occurred,
such as a significant adverse change in the business climate, loss of key personnel or a decision to sell or dispose of a reporting
unit. The goodwill balance in its entirety relates to our IMES reporting unit which is included in our Healthcare segment.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Intangible assets are initially recorded
at their fair market values determined on quoted market prices in active markets, if available, or recognized valuation models.
Intangible assets that have finite useful lives are amortized over their useful lives either on a straight-line basis or over their
projected future cash flows and are tested for impairment when events or changes in circumstances occur that indicate possible
impairment.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our intangible assets represent the fair
value for trade name, customer relationships, non-compete agreements and technology acquired in connection with our acquisitions.
Intangible assets subject to amortization are as follows <i>(in thousands)</i>:</p>
<table cellspacing="0" cellpadding="0" align="center" style="font: 10pt Times New Roman, Times, Serif; width: 95%; border-collapse: collapse">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="5" style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>September 2,</b><br />
<b>2017</b></td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>May 27,</b><br />
<b>2017</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="width: 69%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 8.65pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Gross Amounts:</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Trade Name</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">659</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">659</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Customer Relationships<sup>(1)</sup></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">3,400</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">3,397</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Non-compete Agreements</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">177</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">177</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Technology</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">230</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">230</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 34.55pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Total Gross Amounts</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">4,466</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">4,463</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 8.65pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Accumulated Amortization:</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Trade Name</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">493</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">441</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Customer Relationships</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">489</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">446</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Non-compete Agreements</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">92</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">84</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Technology</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">58</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">51</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 34.55pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Total Accumulated Amortization</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">1,132</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">1,022</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 8.65pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 34.55pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Net Intangibles</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">3,334</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">3,441</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="margin-top: 0; margin-bottom: 0; font: 10pt Times New Roman, Times, Serif"> </p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<td style="width: 0; font: 10pt Times New Roman, Times, Serif"></td><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif">(1)</td><td style="font: 10pt Times New Roman, Times, Serif">Change from prior periods reflect impact of foreign currency translation.</td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></p>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></p>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The amortization expense associated with
the intangible assets subject to amortization for the next five years is presented in the following table <i>(in thousands)</i>:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" align="center" style="font: 10pt Times New Roman, Times, Serif; width: 95%; border-collapse: collapse">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><b>Fiscal Year</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>Amortization</b><br />
<b>Expense</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="width: 86%; font: 10pt Times New Roman, Times, Serif">Remaining 2018</td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif">324</td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">2019</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">245</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">2020</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">257</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">2021</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">245</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">2022</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">252</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Thereafter</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">2,011</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><b>Total amortization expense</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">3,334</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The weighted average number of years of amortization expense
remaining is 15.8 years.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Intangible assets subject to amortization are as follows <i>(in thousands)</i>:</p>
<table cellspacing="0" cellpadding="0" align="center" style="font: 10pt Times New Roman, Times, Serif; width: 95%; border-collapse: collapse">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="5" style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>September 2,</b><br />
<b>2017</b></td>
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>May 27,</b><br />
<b>2017</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="width: 69%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 8.65pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Gross Amounts:</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Trade Name</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">659</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">659</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Customer Relationships<sup>(1)</sup></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">3,400</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">3,397</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Non-compete Agreements</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">177</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">177</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Technology</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">230</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">230</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 34.55pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Total Gross Amounts</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">4,466</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">4,463</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 8.65pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Accumulated Amortization:</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Trade Name</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">493</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">441</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Customer Relationships</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">489</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">446</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Non-compete Agreements</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">92</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">84</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Technology</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">58</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">51</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 34.55pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Total Accumulated Amortization</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">1,132</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">1,022</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 8.65pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 34.55pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif"><b>Net Intangibles</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">3,334</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">3,441</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="margin-top: 0; margin-bottom: 0; font: 10pt Times New Roman, Times, Serif"> </p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<td style="width: 0; font: 10pt Times New Roman, Times, Serif"></td><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif">(1)</td><td style="font: 10pt Times New Roman, Times, Serif">Change from prior periods reflect impact of foreign currency translation.</td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></p>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></p>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The amortization expense associated with
the intangible assets subject to amortization for the next five years is presented in the following table <i>(in thousands)</i>:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<table cellspacing="0" cellpadding="0" align="center" style="font: 10pt Times New Roman, Times, Serif; width: 95%; border-collapse: collapse">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"><b>Fiscal Year</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>Amortization</b><br />
<b>Expense</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="width: 86%; font: 10pt Times New Roman, Times, Serif">Remaining 2018</td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif">324</td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">2019</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">245</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">2020</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">257</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">2021</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">245</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">2022</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">252</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Thereafter</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">2,011</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"><b>Total amortization expense</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif">$</td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">3,334</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>5.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>INVESTMENTS</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of September 2, 2017, we had approximately
$4.3 million invested in time deposits and certificates of deposit (“CD”). Of these, $2.4 million mature in less than
twelve months and $1.9 million mature in more than twelve months. The fair value of these investments is equal to the face value
of each time deposit and CD.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of May 27, 2017, we have invested in
time deposits and certificates of deposit in the amount of $8.2 million. Of this, $6.4 million mature in less than twelve months
and $1.8 million mature in greater than twelve months. The fair value of these investments is the face value of each time deposit
and CD.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We also have investments in equity securities,
all of which are classified as available-for-sale and are carried at their fair value based on quoted market prices. Our investments,
which are included in non-current assets, had a carrying amount of $0.6 million as of September 2, 2017 and as of May 27, 2017.
Proceeds from the sale of securities were $0.2 million and $0.1 million during the first quarters of fiscal 2018 and fiscal 2017,
respectively. We reinvested proceeds from the sale of securities, and the cost of the equity securities sold was based on a specific
identification method. Gross realized gains on those sales were less than $0.1 million during the first quarter of fiscal 2018
and during the first quarter of fiscal 2017. Net unrealized holding gains of less than $0.1 million during the first quarter of
fiscal 2018 and during the first quarter of fiscal 2017, have been included in accumulated other comprehensive income (loss).</p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>6.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>WARRANTIES</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We offer warranties for the limited number
of specific products we manufacture. We also provide extended warranties for some products we sell that lengthen the period of
coverage specified in the manufacturer’s original warranty. Our warranty terms generally range from one to three years.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We estimate the cost to perform under the
warranty obligation and recognize this estimated cost at the time of the related product sale. We record expense related to our
warranty obligations as cost of sales in our consolidated statements of comprehensive income (loss). Each quarter, we assess actual
warranty costs incurred on a product-by-product basis and compare the warranty costs to our estimated warranty obligation. With
respect to new products, estimates are based generally on knowledge of the products, the extended warranty period and warranty
experience.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Warranty reserves are established for costs
that are expected to be incurred after the sale and delivery of products under warranty. Warranty reserves are included in accrued
liabilities on our consolidated balance sheets. The warranty reserves are determined based on known product failures, historical
experience and other available evidence. Warranty reserves were approximately $0.1 million as of both September 2, 2017 and May
27, 2017.</p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>7.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>LEASE OBLIGATIONS, OTHER COMMITMENTS AND CONTINGENCIES</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We lease certain warehouse and office facilities
and office equipment under non-cancelable operating leases. Rent expense was $0.4 million during the first three months of fiscal
2018 and $0.5 million during the first three months of fiscal 2017. Our future lease commitments for minimum rentals, including
common area maintenance charges and property taxes during the next five years are as follows <i>(in thousands)</i>:</p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="width: 84%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; padding-left: 25.9pt; text-indent: -8.65pt"><b>Fiscal Year</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>Payments</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Remaining 2018</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,254</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">2019</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,511</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">2020</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,146</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">2021</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">824</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">2022</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">173</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Thereafter</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">195</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Our future lease commitments for minimum rentals, including
common area maintenance charges and property taxes during the next five years are as follows <i>(in thousands)</i>:</p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="width: 84%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 12%; text-align: right; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; padding-left: 25.9pt; text-indent: -8.65pt"><b>Fiscal Year</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><b>Payments</b></td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Remaining 2018</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif">$</td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,254</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">2019</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,511</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">2020</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,146</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">2021</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">824</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">2022</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">173</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="padding-left: 25.9pt; text-indent: -8.65pt; font: 10pt Times New Roman, Times, Serif">Thereafter</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: right; font: 10pt Times New Roman, Times, Serif">195</td>
<td style="font: 10pt Times New Roman, Times, Serif"> </td></tr></table>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0; font: 10pt Times New Roman, Times, Serif"></td><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>8.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>INCOME TAXES</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We recorded an income tax provision of $0.1
million and $0.5 million for the first three months of fiscal 2018 and the first three months of fiscal 2017, respectively. The
effective income tax rate during the first three months of fiscal 2018 was a tax provision of (133.3%), as compared to a tax provision
of (21.1%) during the first three months of fiscal 2017. The difference in rate during the first three months of fiscal 2018, as
compared to the first three months of fiscal 2017, reflects the change in the overall loss realized through the first quarter in
each respective period, changes in our geographical distribution of income (loss), the recording of provision to return true-ups
of various foreign jurisdictions and our positions with respect to ASC 740-30, Income Taxes - Other Considerations or Special Areas
(“ASC 740-30”). The (133.3%) effective income tax rate differs from the federal statutory rate of 34.0% as a result
of our geographical distribution of income (loss) and the recording of a valuation allowance against the increase in our U.S. state
and federal net deferred tax assets.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In the normal course of business, we are
subject to examination by taxing authorities throughout the world. Generally, years prior to fiscal 2007 are closed for examination
under the statute of limitation for U.S. federal, U.S. state and local, or non-U.S. tax jurisdictions. We are currently under examination
in Germany (fiscal 2011 through 2014) and Thailand (fiscal 2008 through 2011). We are also under examination in the state of Illinois
for fiscal years 2014 and 2015. Our primary foreign tax jurisdictions are Germany and the Netherlands. We have tax years open in
Germany beginning in fiscal 2011 and the Netherlands beginning in fiscal 2011.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have historically determined that certain
undistributed earnings of our foreign subsidiaries, to the extent of cash available, will be repatriated to the U.S. Accordingly,
we have provided a deferred tax liability totaling $5.7 million as of September 2, 2017, on foreign earnings of $39.5 million.
In addition, as of September 2, 2017, approximately $6.4 million balance of cumulative positive earnings of some of our foreign
subsidiaries are still considered permanently reinvested pursuant to ASC 740-30. Due to various tax attributes that are continuously
changing, it is not practicable to determine what, if any, tax liability might exist if such earnings were to be repatriated.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We had no worldwide liability for uncertain
tax positions related to continuing operations, excluding interest and penalties, as of September 2, 2017 and as of May 27, 2017.
There is no change in recorded uncertain tax positions during the first quarter of fiscal 2018. We record penalties and interest
relating to uncertain tax positions in the income tax expense line item within the unaudited consolidated statements of income
(loss).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The valuation allowance against the net
deferred tax assets has increased to $9.2 million as of September 2, 2017 driven primarily by the Illinois income tax rate increase
and the impact on the overall federal and Illinois deferred tax assets as well as additional domestic federal and state net deferred
tax assets generated during the first quarter of fiscal year 2018 due to additional losses in the U.S. jurisdiction of $0.5 million.
The valuation allowance against the net deferred tax assets that will more likely than not be realized was $8.5 million as of May
27, 2017. A full valuation allowance on the U.S. and state deferred tax assets will be maintained until sufficient positive evidence
related to sources of future taxable income exists to support a reversal of the valuation allowance. The amount of the deferred
tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period
are increased, or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may
be given to subjective evidence such as our projections for growth.</p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>9.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>CALCULATION OF EARNINGS PER SHARE</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We have authorized 17,000,000 shares of
common stock, and 3,000,000 shares of Class B common stock. The Class B common stock has 10 votes per share and has transferability
restrictions; however, Class B common stock may be converted into common stock on a share-for-share basis at any time. With respect
to dividends and distributions, shares of common stock and Class B common stock rank equally and have the same rights, except that
Class B common stock cash dividends are limited to 90% of the amount of Class A common stock cash dividends.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In accordance with ASC 260-10, <i>Earnings
Per Share </i>(“ASC 260”), our Class B common stock is considered a participating security requiring the use of the
two-class method for the computation of basic and diluted earnings per share. The two-class computation method for each period
reflects the cash dividends paid per share for each class of stock, plus the amount of allocated undistributed earnings per share
computed using the participation percentage which reflects the dividend rights of each class of stock. Basic and diluted earnings
per share were computed using the two-class method as prescribed in ASC 260. The shares of Class B common stock are considered
to be participating convertible securities since the shares of Class B common stock are convertible on a share-for-share basis
into shares of common stock and may participate in dividends with common stock according to a predetermined formula which is 90%
of the amount of Class A common stock cash dividends.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The earnings per share (“EPS”)
presented in our unaudited consolidated statements of comprehensive income (loss) are based on the following amounts (<i>in thousands,
except per share amounts</i>):</p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="14" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">For the Three Months Ended</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="6" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">September 2, 2017</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="6" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">August 27, 2016</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Basic</td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Diluted</td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Basic</td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Diluted</td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: italic 10pt Times New Roman, Times, Serif; text-align: left; background-color: White">Numerator for Basic and Diluted EPS:</td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 52%; font: bold 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -8.65pt; padding-left: 17.3pt">Net loss</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 8%; text-align: right; font: 10pt Times New Roman, Times, Serif">(112</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 8%; text-align: right; font: 10pt Times New Roman, Times, Serif">(112</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 8%; text-align: right; font: 10pt Times New Roman, Times, Serif">(2,850</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 8%; text-align: right; font: 10pt Times New Roman, Times, Serif">(2,850</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Less dividends:</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 25.9pt; font: 10pt Times New Roman, Times, Serif">Common stock</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">643</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">643</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">641</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">641</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 25.9pt; font: 10pt Times New Roman, Times, Serif">Class B common stock</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">115</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">115</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">116</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">116</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Undistributed losses</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(870</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(870</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(3,607</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(3,607</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Common stock undistributed losses</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">(738</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">(738</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">(3,057</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">(3,057</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Class B common stock undistributed losses</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(132</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(132</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(550</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(550</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Total undistributed losses</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(870</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(870</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(3,607</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(3,607</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: italic 10pt Times New Roman, Times, Serif; text-align: left">Denominator for basic and diluted EPS:</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 2pt; text-indent: -13.5pt; padding-left: 13.5pt; font: 10pt Times New Roman, Times, Serif">   Common stock weighted average shares</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">10,712</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">10,712</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">10,703</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">10,703</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; text-indent: -0.25in; padding-left: 0.25in; font: 10pt Times New Roman, Times, Serif">   Class B common stock weighted average shares, and shares under     if-converted method for diluted EPS</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">2,137</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,137</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">2,141</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,141</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Effect of dilutive securities</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 25.9pt; font: 10pt Times New Roman, Times, Serif">Dilutive stock options</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">—</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">—</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Denominator for diluted EPS adjusted for weighted average shares and assumed conversions</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">12,849</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">12,844</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif">Net loss per share:</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif">Common stock</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.01</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.01</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.23</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.23</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif">Class B common stock</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.01</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.01</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.20</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.20</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><i>Note: Common stock options that were anti-dilutive and not
included in diluted earnings per common share for the first quarter of fiscal 2018 and fiscal 2017 were 920 and 838, respectively.</i></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The earnings per share (“EPS”)
presented in our unaudited consolidated statements of comprehensive income (loss) are based on the following amounts (<i>in thousands,
except per share amounts</i>):</p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="14" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">For the Three Months Ended</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="6" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">September 2, 2017</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="6" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">August 27, 2016</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Basic</td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Diluted</td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Basic</td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Diluted</td><td style="font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: italic 10pt Times New Roman, Times, Serif; text-align: left; background-color: White">Numerator for Basic and Diluted EPS:</td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 52%; font: bold 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -8.65pt; padding-left: 17.3pt">Net loss</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 8%; text-align: right; font: 10pt Times New Roman, Times, Serif">(112</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 8%; text-align: right; font: 10pt Times New Roman, Times, Serif">(112</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 8%; text-align: right; font: 10pt Times New Roman, Times, Serif">(2,850</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 8%; text-align: right; font: 10pt Times New Roman, Times, Serif">(2,850</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Less dividends:</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 25.9pt; font: 10pt Times New Roman, Times, Serif">Common stock</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">643</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">643</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">641</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">641</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 25.9pt; font: 10pt Times New Roman, Times, Serif">Class B common stock</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">115</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">115</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">116</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">116</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Undistributed losses</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(870</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(870</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(3,607</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(3,607</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Common stock undistributed losses</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">(738</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">(738</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">(3,057</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">(3,057</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Class B common stock undistributed losses</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(132</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(132</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(550</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(550</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Total undistributed losses</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(870</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(870</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(3,607</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(3,607</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: italic 10pt Times New Roman, Times, Serif; text-align: left">Denominator for basic and diluted EPS:</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 2pt; text-indent: -13.5pt; padding-left: 13.5pt; font: 10pt Times New Roman, Times, Serif">   Common stock weighted average shares</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">10,712</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">10,712</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">10,703</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">10,703</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; text-indent: -0.25in; padding-left: 0.25in; font: 10pt Times New Roman, Times, Serif">   Class B common stock weighted average shares, and shares under     if-converted method for diluted EPS</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">2,137</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,137</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">2,141</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,141</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Effect of dilutive securities</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 25.9pt; font: 10pt Times New Roman, Times, Serif">Dilutive stock options</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">—</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">—</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 17.3pt; font: 10pt Times New Roman, Times, Serif">Denominator for diluted EPS adjusted for weighted average shares and assumed conversions</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">12,849</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">12,844</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif">Net loss per share:</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif">Common stock</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.01</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.01</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.23</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.23</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif">Class B common stock</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.01</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.01</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.20</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">(0.20</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><i>Note: Common stock options that were anti-dilutive and not
included in diluted earnings per common share for the first quarter of fiscal 2018 and fiscal 2017 were 920 and 838, respectively.</i></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-indent: -0.25in"><b>10. SEGMENT REPORTING</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-indent: -0.25in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">In accordance with ASC 280-10, Segment Reporting,
we have identified three operating and reportable segments as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Power and Microwave Technologies Group (“PMT”)
combines our core engineered solutions, power grid and microwave tube business with new RF and power technologies. As a manufacturer
and authorized distributor, PMT’s strategy is to provide specialized technical expertise and engineered solutions based on
our core engineering and manufacturing capabilities. We provide solutions and add value through design-in support, systems integration,
prototype design and manufacturing, testing, logistics, and aftermarket technical service and repair—all through our existing
global infrastructure. PMT’s focus is on products for power, RF and microwave applications for customers in alternative energy,
aviation, broadcast, communications, industrial, marine, medical, military, scientific, and semiconductor markets. PMT focuses
on various applications including broadcast transmission, CO2 laser cutting, diagnostic imaging, dielectric and induction heating,
high energy transfer, high voltage switching, plasma, power conversion, radar, and radiation oncology. PMT also offers its customers
technical services for both microwave and industrial equipment.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Canvys provides customized display solutions
serving the corporate enterprise, financial, healthcare, industrial, and medical original equipment manufacturers (“OEM”)
markets.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Healthcare manufactures, refurbishes and
distributes high value replacement parts for the healthcare market including hospitals, medical centers, asset management companies,
independent service organizations, and multi-vendor service providers. Products include Diagnostic Imaging replacement parts including
CT and MRI tubes, hydrogen thyratrons, klystrons, magnetrons; replacement flat panel detectors and upgrades; and additional replacement
components currently under development for the diagnostic imaging service market. Through a combination of newly developed products
and partnerships, service offerings, and training programs, we believe we can help our customers improve efficiency and deliver
better clinical outcomes while lowering the cost of healthcare delivery.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The CEO evaluates performance and allocates
resources primarily based on the gross profit of each segment. </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Operating results by segment are summarized
in the following table (<i>in thousands</i>):</p>
<table cellpadding="0" cellspacing="0" align="center" style="border-collapse: collapse; width: 60%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="6" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Three Months Ended</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">September 2,<br /> 2017</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">August 27,<br /> 2016</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif"><u>PMT</u></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 60%; text-align: left; font: 10pt Times New Roman, Times, Serif">Net Sales</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 16%; text-align: right; font: 10pt Times New Roman, Times, Serif">29,124</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 16%; text-align: right; font: 10pt Times New Roman, Times, Serif">25,381</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Gross Profit</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">9,574</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">7,455</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline">Canvys</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Net Sales</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">5,765</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">4,620</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Gross Profit</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,546</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,348</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline">Healthcare</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Net Sales</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,106</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">3,372</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Gross Profit</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,028</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,437</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Geographic net sales information is primarily
grouped by customer destination into five areas: North America; Asia/Pacific; Europe; Latin America; and Other.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Net sales and gross profit by geographic
region are summarized in the following table (<i>in thousands</i>):</p>
<table cellpadding="0" cellspacing="0" align="center" style="border-collapse: collapse; width: 60%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="6" style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="6" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Three Months Ended</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">September 2,<br /> 2017</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">August 27,<br /> 2016</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-align: left; background-color: White"><u>Net Sales</u></td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 60%; text-align: left; font: 10pt Times New Roman, Times, Serif">North America</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 16%; text-align: right; font: 10pt Times New Roman, Times, Serif">15,063</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 16%; text-align: right; font: 10pt Times New Roman, Times, Serif">13,049</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Asia/Pacific</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">7,010</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">7,655</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Europe</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">12,500</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">10,264</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Latin America</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,419</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,390</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif">Other (1)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">3</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">15</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif">Total</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">36,995</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">33,373</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline; text-align: left">Gross Profit</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">North America</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">5,606</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">4,885</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Asia/Pacific</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,380</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,558</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Europe</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">4,105</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">3,029</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Latin America</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">964</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">917</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif">Other (1)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(907</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(1,149</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif">Total</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">12,148</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">10,240</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(1) Other includes primarily net sales not
allocated to a specific geographical region, unabsorbed value-add costs and other unallocated expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We sell our products to customers in diversified
industries and perform periodic credit evaluations of our customers’ financial condition. Terms are generally on open account,
payable net 30 days in North America, and vary throughout Asia/Pacific, Europe and Latin America. Estimates of credit losses are
recorded in the financial statements based on monthly reviews of outstanding accounts.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Operating results by segment are summarized
in the following table (<i>in thousands</i>):</p>
<table cellpadding="0" cellspacing="0" align="center" style="border-collapse: collapse; width: 60%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="6" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Three Months Ended</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">September 2,<br /> 2017</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">August 27,<br /> 2016</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif"><u>PMT</u></td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 60%; text-align: left; font: 10pt Times New Roman, Times, Serif">Net Sales</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 16%; text-align: right; font: 10pt Times New Roman, Times, Serif">29,124</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 16%; text-align: right; font: 10pt Times New Roman, Times, Serif">25,381</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Gross Profit</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">9,574</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">7,455</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline">Canvys</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Net Sales</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">5,765</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">4,620</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Gross Profit</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,546</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,348</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline">Healthcare</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Net Sales</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,106</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">3,372</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Gross Profit</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,028</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">1,437</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Net sales and gross profit by geographic
region are summarized in the following table (<i>in thousands</i>):</p>
<table cellpadding="0" cellspacing="0" align="center" style="border-collapse: collapse; width: 60%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="6" style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="6" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Three Months Ended</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: center; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">September 2,<br /> 2017</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">August 27,<br /> 2016</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-align: left; background-color: White"><u>Net Sales</u></td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="background-color: White; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; background-color: White; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 60%; text-align: left; font: 10pt Times New Roman, Times, Serif">North America</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 16%; text-align: right; font: 10pt Times New Roman, Times, Serif">15,063</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 16%; text-align: right; font: 10pt Times New Roman, Times, Serif">13,049</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Asia/Pacific</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">7,010</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">7,655</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Europe</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">12,500</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">10,264</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Latin America</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,419</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,390</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif">Other (1)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">3</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">15</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif">Total</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">36,995</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">33,373</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline; text-align: left">Gross Profit</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">North America</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">5,606</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">4,885</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Asia/Pacific</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,380</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">2,558</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif">Europe</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">4,105</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">3,029</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">Latin America</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">964</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">917</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif">Other (1)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(907</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">(1,149</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif">)</td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif">Total</td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">12,148</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="padding-bottom: 2pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: 10pt Times New Roman, Times, Serif; text-align: right">10,240</td><td style="padding-bottom: 2pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(1) Other includes primarily net sales not
allocated to a specific geographical region, unabsorbed value-add costs and other unallocated expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0; font: 10pt Times New Roman, Times, Serif"></td><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>11.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>LITIGATION</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">We are involved in several pending judicial
proceedings concerning matters arising in the ordinary course of business. While the outcome of litigation is subject to uncertainties,
based on information available at the time the financial statements were issued, we determined disclosure of contingencies relating
to any of our pending judicial proceedings was not necessary because there was less than a reasonable possibility that a material
loss will be incurred.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>12.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>FAIR VALUE MEASUREMENTS</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">ASC 820, <i>Fair Value Measurements and
Disclosures </i>(“ASC 820”), defines fair value, establishes a framework for measuring fair value in accordance with
accounting principles generally accepted in the United States and expands disclosures about fair value measurements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">ASC 820 establishes a three-tier fair value
hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs
such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either
directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists; therefore
requiring an entity to develop its own assumptions.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As of September 2, 2017 and May 27, 2017,
we held investments that are required to be measured at fair value on a recurring basis. Our investments consist of time deposits
and CDs, where face value is equal to fair value, and equity securities of publicly traded companies for which market prices are
readily available.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Investments measured at fair value on a
recurring basis subject to the disclosure requirements of ASC 820 as of September 2, 2017 and May 27, 2017, were as follows (<i>in
thousands</i>):</p>
<table cellpadding="0" cellspacing="0" align="center" style="border-collapse: collapse; width: 95%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Level 1</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline; text-indent: -8.65pt; padding-left: 8.65pt">September 2, 2017</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 86%; text-align: left; text-indent: -8.65pt; padding-left: 8.65pt; font: 10pt Times New Roman, Times, Serif">Time deposits/CDs</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif">4,301</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 8.65pt; font: 10pt Times New Roman, Times, Serif">Equity securities</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">637</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 8.65pt">Total</td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 2pt"> </td>
<td style="border-bottom: Black 2pt double; font: bold 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: bold 10pt Times New Roman, Times, Serif; text-align: right">4,938</td><td style="padding-bottom: 2pt; font: bold 10pt Times New Roman, Times, Serif; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline; text-indent: -8.65pt; padding-left: 8.65pt">May 27, 2017</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 8.65pt; font: 10pt Times New Roman, Times, Serif">Time deposits/CDs</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">8,226</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 8.65pt; font: 10pt Times New Roman, Times, Serif">Equity securities</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">622</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 8.65pt">Total</td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 2pt"> </td>
<td style="border-bottom: Black 2pt double; font: bold 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: bold 10pt Times New Roman, Times, Serif; text-align: right">8,848</td><td style="padding-bottom: 2pt; font: bold 10pt Times New Roman, Times, Serif; text-align: left"> </td></tr>
</table>
<p style="margin-top: 0; margin-bottom: 0; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Investments measured at fair value on a
recurring basis subject to the disclosure requirements of ASC 820 as of September 2, 2017 and May 27, 2017, were as follows (<i>in
thousands</i>):</p>
<table cellpadding="0" cellspacing="0" align="center" style="border-collapse: collapse; width: 95%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td colspan="2" style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: 10pt Times New Roman, Times, Serif"> </td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 1pt"> </td>
<td colspan="2" style="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Level 1</td><td style="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline; text-indent: -8.65pt; padding-left: 8.65pt">September 2, 2017</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="width: 86%; text-align: left; text-indent: -8.65pt; padding-left: 8.65pt; font: 10pt Times New Roman, Times, Serif">Time deposits/CDs</td><td style="width: 2%; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="width: 10%; text-align: right; font: 10pt Times New Roman, Times, Serif">4,301</td><td style="width: 1%; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 8.65pt; font: 10pt Times New Roman, Times, Serif">Equity securities</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">637</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 8.65pt">Total</td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 2pt"> </td>
<td style="border-bottom: Black 2pt double; font: bold 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: bold 10pt Times New Roman, Times, Serif; text-align: right">4,938</td><td style="padding-bottom: 2pt; font: bold 10pt Times New Roman, Times, Serif; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; text-decoration: underline; text-indent: -8.65pt; padding-left: 8.65pt">May 27, 2017</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif"> </td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; text-indent: -8.65pt; padding-left: 8.65pt; font: 10pt Times New Roman, Times, Serif">Time deposits/CDs</td><td style="font: 10pt Times New Roman, Times, Serif"> </td>
<td style="text-align: left; font: 10pt Times New Roman, Times, Serif">$</td><td style="text-align: right; font: 10pt Times New Roman, Times, Serif">8,226</td><td style="text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: White; font: 10pt Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -8.65pt; padding-left: 8.65pt; font: 10pt Times New Roman, Times, Serif">Equity securities</td><td style="padding-bottom: 1pt; font: 10pt Times New Roman, Times, Serif"> </td>
<td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left"> </td><td style="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">622</td><td style="padding-bottom: 1pt; text-align: left; font: 10pt Times New Roman, Times, Serif"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font: 10pt Times New Roman, Times, Serif">
<td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 2pt; text-indent: -8.65pt; padding-left: 8.65pt">Total</td><td style="font: bold 10pt Times New Roman, Times, Serif; padding-bottom: 2pt"> </td>
<td style="border-bottom: Black 2pt double; font: bold 10pt Times New Roman, Times, Serif; text-align: left">$</td><td style="border-bottom: Black 2pt double; font: bold 10pt Times New Roman, Times, Serif; text-align: right">8,848</td><td style="padding-bottom: 2pt; font: bold 10pt Times New Roman, Times, Serif; text-align: left"> </td></tr>
</table>
<p style="margin-top: 0; margin-bottom: 0; font: 10pt Times New Roman, Times, Serif"> </p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0; font: 10pt Times New Roman, Times, Serif"></td><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>13.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>RELATED PARTY TRANSACTION</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On June 15, 2015, the Company entered into
a lease agreement for the IMES facility with LDL, LLC. The Executive Vice President of IMES, Lee A. McIntyre III (former owner
of IMES), has an ownership interest in LDL, LLC. The lease agreement provides for monthly payments over five years with total future
minimum lease payments of $0.4 million. Rental expense related to this lease amounted to less than $0.1 million for the three months
ended September 2, 2017 and August 27, 2016. The Company shall be entitled to extend the term of the lease for a period of an additional
five years by notifying the landlord in writing of its intention to do so within nine months of the expiration of the initial term.</p>
<table cellpadding="0" cellspacing="0" style="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><tr style="vertical-align: top; font: 10pt Times New Roman, Times, Serif"><td style="width: 0; font: 10pt Times New Roman, Times, Serif"></td><td style="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><b>14.</b></td><td style="font: 10pt Times New Roman, Times, Serif"><b>SUBSEQUENT EVENT</b></td></tr></table>
<p style="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On September 12, 2017, the Company received
an income tax refund from the State of Illinois of approximately $2.0 million, which was inclusive of interest earned. The refund
was a result of the conclusion of the Illinois amended return related to the sale of RFPD in 2011. A net benefit of $1.5 million,
which includes $0.5 million of professional fee costs incurred to pursue the refund, will be recognized in the second quarter of
fiscal 2018 in discontinued operations.</p>
In the second quarter of fiscal year 2017, the Company executed a reduction in headcount to streamline operations and reduce costs and recorded $1.3 million of expense included in selling, general and administrative expenses for employee termination costs payable to terminated employees with employment and/or separation agreements with the Company. The changes in the severance accrual for the first three months of fiscal year 2018 included payments of $0.2 million.
Change from prior periods reflect impact of foreign currency translation.
Other includes primarily net sales not allocated to a specific geographical region, unabsorbed value-add costs and other unallocated expenses.