2. STOCK-BASED COMPENSATION (Tables)

6 Months Ended

Nov. 30, 2017

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

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

  The following table summarizes the stock-based compensation expense related to the Company’s stock-based incentive plans for the three and six months ended November 30, 2017 and 2016 (in thousands):

	Three Months Ended				Six Months Ended
	November 30,				November 30,
	2017		2016		2017		2016
Stock-based compensation in the form of employee stock options, RSUs and ESPP purchase rights, included in:
Cost of sales	$	57	$	23	$	79	$	47
Selling, general and administrative		218		141		368		388
Research and development		89		51		133		99
Total stock-based compensation	$	364	$	215	$	580	$	534

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, 2017 and 2016 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,
	2017			2016			2017			2016
Expected term (in years)		4			4			4			4
Volatility		0.74			0.81			0.77			0.81
Risk-free interest rate		1.92	%		1.10	%		1.77	%		1.02	%
Weighted average grant date fair value	$	1.93		$	1.66		$	2.22		$	1.09

Stock option and RSU transactions

    The following tables summarize the Company’s stock option and RSU

transactions during the three and six months ended November 30, 2017 (in thousands):

	Available
	Shares
Balance, May 31, 2017		2,169
Options granted		(224	)
RSUs granted		(64	)
Shares cancelled		--
Balance, August 31, 2017		1,881
Options granted		(41	)
RSUs granted		--
Shares cancelled		--
Balance, November 30, 2017		1,840

Stock option transactions

   The following table summarizes the stock option transactions during the three and six months ended November 30, 2017 (in thousands, except per share data):

	Outstanding Options
				Weighted
	Number			Average		Aggregate
	of			Exercise		Intrinsic
	Shares			Price		Value
Balances, May 31, 2017		3,074		$	1.73	$	8,763
Options granted		224		$	3.93
Options cancelled		--		$	--
Options exercised		(189	)	$	1.23
Balances, August 31, 2017		3,109		$	1.92	$	4,612
Options granted		41		$	3.46
Options cancelled		--		$	--
Options exercised		(132	)	$	1.46
Balances, November 30, 2017		3,018		$	1.96	$	2,230
Options fully vested and expected to vest at November 30, 2017		2,984		$	1.95	$	2,220

Options outstanding

 The options outstanding and exercisable at November 30, 2017 were in the following exercise price ranges (in thousands, except per share data):

		Options Outstanding						Options Exercisable
		at November 30, 2017						at November 30, 2017
Range of Exercise Prices		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		424		1.31	$	0.68		424		1.31	$	0.68
$	1.09-$1.36		645		2.11	$	1.27		645		2.10	$	1.27
$	1.68-$2.06		487		4.73	$	1.74		276		4.03	$	1.79
$	2.10-$2.81		1,197		4.01	$	2.45		953		3.99	$	2.47
$	3.46-$3.93		265		6.66	$	3.88		22		6.66	$	3.88
$	0.59-$3.93		3,018		3.57	$	1.96		2,320		3.00	$	1.74	$ 1,985