2. STOCK-BASED COMPENSATION (Tables)

6 Months Ended

Nov. 30, 2015

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

Compensation costs related to the Company's stock-based compensation

    The following table summarizes compensation costs related to the Company’s stock-based compensation for the three and six months ended November 30, 2015 and 2014 (in thousands):

	Three Months Ended				Six Months Ended
	November 30,				November 30,
	2015		2014		2015		2014
Stock-based compensation in the form of employee stock options and ESPP shares, included in:
Cost of sales	$	20	$	16	$	42	$	30
Selling, general and administrative		186		212		424		360
Research and development		48		49		107		84
Total stock-based compensation	$	254	$	277	$	573	$	474

Assumptions for Options Valuation Model

    Fair Value.  The fair value of the Company’s stock options granted to employees for the three and six months ended November 30, 2015 and 2014 were estimated using the following weighted average assumptions in the Black-Scholes option valuation model:

	Three Months Ended						Six Months Ended
	November 30,						November 30,
	2015			2014			2015			2014
Option plan shares
Expected term (in years)		4			4			4			4
Volatility		0.86			0.90			0.86			0.91
Expected dividend	$	0.00		$	0.00		$	0.00		$	0.00
Risk-free interest rates		1.21	%		1.11	%		1.21	%		1.25	%
Estimated forfeiture rate		0.25	%		0.25	%		0.25	%		0.25	%
Weighted average grant date fair value	$	1.38		$	1.32		$	1.38		$	1.64

Fair values of the ESPP shares

    The fair values of the ESPP purchase rights granted for the three and six months ended November 30, 2014 were estimated using the following weighted-average assumptions:

	Three and Six Months Ended November 30, 2014
Expected term (in years)		0.5-2.0
Volatility		0.55-0.83
Expected dividend	$	0.00
Risk-free interest rates		0.04%-0.53	%
Estimated forfeiture rate		0	%
Weighted average grant date fair value	$	1.47

Stock option transactions

    The following table summarizes the stock option transactions during the three and six months ended November 30, 2015 (in thousands, except per share data):

				Outstanding Options
								Weighted
					Number			Average		Aggregate
	Available				of			Exercise		Intrinsic
	Shares				Shares			Price		Value
Balances, May 31, 2015		845				3,686		$	1.66	$	2,946
Options granted		--				--			--
Options terminated		122				(122	)	$	2.04
Options exercised		--				(130	)	$	1.72
Balances, August 31, 2015		967				3,434		$	1.63	$	2,587
Additional shares reserved		800				--
Options granted		(82	)			82		$	2.22
Options terminated		15				(15	)	$	1.61
Options exercised		--				(116	)	$	0.91
Balances, November 30, 2015		1,700				3,385		$	1.67	$	1,643
Options fully vested and expected to vest at November 30, 2015						3,318		$	1.67	$	1,610
Options exercisable at November 30, 2015						2,238		$	1.47	$	1,416

Options Outstanding

    The options outstanding and exercisable at November 30, 2015 were in the following exercise price ranges (in thousands, except per share data):

		Options Outstanding						Options Exercisable
		at November 30, 2015						at November 30, 2015
Range of Exercise Price		Number Outstanding Shares		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number Exercisable Shares		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price			Aggregate Intrinsic Value
$	0.59-$0.97		578		3.31	$	0.68		561		3.32	$	0.68
$	1.09-$1.40		1,222		3.59	$	1.28		945		3.38	$	1.28
$	1.73-$2.06		267		5.18	$	1.88		228		5.25	$	1.90
$	2.10-$2.71		1,318		5.93	$	2.43		504		5.70	$	2.49
$	0.59-$2.71		3,385		4.58	$	1.67		2,238		4.08	$	1.47	$	1,416