M.	Shareholders’ Equity

The Company completed the sale of

1,533.3

shares of its common stock through a registered offering which closed on

September 25, 2018,

at a price to the public of

$22.50

per share. The net proceeds received by the Company and after underwriting expenses of

$2,070

and offering expenses of

$220,

were

$32,210

and were recorded as paid-in capital as of

September 28, 2018.

The proceeds were used to partially pay down the Term Loan and Revolving Loans (see Note L).

The Company, from time to time, makes open market purchases of its common stock under authorizations given to it by the Board of Directors, of which

315.0

shares as of

September 28, 2018

remain authorized for purchase. The Company did

not

make any open market purchases of its shares during the quarters ended

September 28, 2018

and

September 29, 2017.

The following is a reconciliation of the Company’s equity balances for the

first

fiscal quarter of

2019

and

2018:

	Twin Disc, Inc. Shareholders’ Equity
						Accumulated
						Other						Non-
	Common			Retained		Comprehensive			Treasury			Controlling			Total
	Stock			Earnings		Income (Loss)			Stock			Interest			Equity
Balance, June 30, 2018	$	11,570		$	178,896	$	(23,792	)	$	(23,677	)	$	619		$	143,616
Net income					2,862								41			2,903
Translation adjustments							(536	)					(25	)		(561	)
Benefit plan adjustments, net of tax							471									471
Release stranded tax effects					6,903		(6,903	)								-
Cash dividends													(115	)		(115	)
Compensation expense		850														850
Common stock issued, net		32,210														32,210
Shares acquired, net		(586	)							(328	)					(914	)
Balance, September 28, 2018	$	44,044		$	188,661	$	(30,760	)	$	(24,005	)	$	520		$	178,460

	Twin Disc, Inc. Shareholders’ Equity
						Accumulated
						Other						Non-
	Common			Retained		Comprehensive			Treasury			Controlling			Total
	Stock			Earnings		Income (Loss)			Stock			Interest			Equity
Balance, June 30, 2017	$	10,429		$	169,368	$	(32,671	)	$	(24,205	)	$	646		$	123,567
Net income					3,392								13			3,405
Translation adjustments							2,547						(6	)		2,541
Benefit plan adjustments, net of tax							474									474
Cash dividends													(172	)		(172	)
Compensation expense		479														479
Shares (acquired) issued, net		(1,030	)							817						(213	)
Balance, September 29, 2017	$	9,878		$	172,760	$	(29,650	)	$	(23,388	)	$	481		$	130,081

Reconciliations for the changes in accumulated other comprehensive income (loss), net of tax, by component for the quarters ended

September 28, 2018,

and

September 29, 2017

are as follows:

	Translation			Benefit Plan
	Adjustment			Adjustment
Balance at June 30, 2018	$	7,085		$	(30,877	)
Translation adjustment during the quarter		(536	)		-
Release stranded tax effects		-			(6,903	)
Amounts reclassified from accumulated other comprehensive income		-			471
Net current period other comprehensive income		(536	)		(6,432	)
Balance at September 28, 2018	$	6,549		$	(37,309	)

	Translation		Benefit Plan
	Adjustment		Adjustment
Balance at June 30, 2017	$	6,130	$	(38,801	)
Translation adjustment during the quarter		2,547		-
Amounts reclassified from accumulated other comprehensive income		-		474
Net current period other comprehensive income		2,547		474
Balance at September 29, 2017	$	8,677	$	(38,327	)

Reconciliation for the changes in benefit plan adjustments, net of tax for the quarter ended

September 28, 2018

are as follows:

	Amount Reclassified
	Quarter Ended
	September 28, 2018
Changes in benefit plan items
Actuarial losses	$	607	(a)
Transition asset and prior service benefit		10	(a)
Total amortization		617
Income taxes		146
Total reclassification net of tax	$	471

Reconciliation for the changes in benefit plan adjustments, net of tax for the quarter ended

September 29, 2017

is as follows:

	Amount Reclassified
	Quarter Ended
	September 29, 2017
Changes in benefit plan items
Actuarial losses	$	742	(a)
Transition asset and prior service benefit		10	(a)
Total amortization		752
Income taxes		278
Total reclassification net of tax	$	474

(a)

These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note I "Pension and Other Postretirement Benefit Plans" for further details).