SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

Quarterly Report Pursuant to Section 13 or 15(d)

of the Securities Act of 1934

For the Quarter Ended March 27, 2015

Commission File No. 0-23018

PLANAR SYSTEMS, INC.

(exact name of registrant as specified in its charter)

Oregon	93-0835396
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

1195 NW Compton Dr., Beaverton, Oregon	97006
(Address of principal executive offices)	(zip code)

Registrant’s telephone number, including area code: (503) 748-1100

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” “non-accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.):    Yes  ¨    No  x

Number of common stock outstanding as of May 1, 2015

22,630,894 shares, no par value per share

PLANAR SYSTEMS, INC.

INDEX

		Page
Part I.	Financial Information		3
Item 1.	Financial Statements		3
	Consolidated Balance Sheets as of March 27, 2015 (unaudited) and September 26, 2014		3
	Consolidated Statements of Income for the Three and Six Months Ended March 27, 2015 and March 28, 2014 (unaudited)		4
	Consolidated Statements of Comprehensive Income for the Three and Six Months Ended March 27, 2015 and March 28, 2014 (unaudited)		5
	Consolidated Statements of Cash Flows for the Six Months Ended March 27, 2015 and March 28, 2014 (unaudited)		6
	Notes to the Consolidated Financial Statements (unaudited)		7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		12
Item 4.	Controls and Procedures		22
Part II.	Other Information		23
Item 1.	Legal Proceedings		23
Item 1a.	Risk Factors		23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		32
Item 6.	Exhibits		33
	Signatures		34

2

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

PLANAR SYSTEMS, INC.

CONSOLIDATED BALANCE SHEETS

	Mar. 27, 2015			Sept. 26, 2014
	(Unaudited)
	(In thousands, except share data)
ASSETS
Current assets:
Cash	$	16,182		$	13,068
Accounts receivable, net of allowance for doubtful accounts of $330 at Mar. 27, 2015 and $469 at Sept. 26, 2014		24,341			28,333
Inventories (Note 2)		31,228			26,805
Other current assets (Note 9)		5,035			3,909
Total current assets		76,786			72,115
Property, plant and equipment, net		4,472			5,039
Other assets (Note 9)		4,865			7,250
	$	86,123		$	84,404
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	20,469		$	18,176
Current portion of capital leases		42			394
Deferred revenue		1,479			1,637
Other current liabilities (Notes 5 and 6)		10,870			12,974
Total current liabilities		32,860			33,181
Other long-term liabilities (Note 5)		4,484			5,189
Total liabilities		37,344			38,370
Shareholders’ equity:
Preferred stock, $0.01 par value, authorized 10,000,000 shares, no shares issued		—			—
Common stock, no par value. Authorized 60,000,000 shares; 22,200,750 and 21,680,975 issued shares at March 27, 2015 and September 26, 2014, respectively		189,887			188,127
Retained deficit		(135,321	)		(138,508	)
Accumulated other comprehensive loss		(5,787	)		(3,585	)
Total shareholders’ equity		48,779			46,034
	$	86,123		$	84,404

See accompanying notes to consolidated financial statements.

3

PLANAR SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three months ended						Six months ended
	Mar. 27, 2015			Mar. 28, 2014			Mar. 27, 2015			Mar. 28, 2014
	(In thousands, except share data)
Sales	$	49,169		$	41,077		$	104,949		$	81,532
Cost of sales		36,946			31,414			78,320			62,137
Gross profit		12,223			9,663			26,629			19,395
Operating expenses:
Research and development, net		1,606			1,469			3,238			2,713
Sales and marketing		6,170			5,054			12,258			9,727
General and administrative		3,721			3,189			7,706			6,456
Restructuring (Note 5)		43			10			53			21
Total operating expenses		11,540			9,722			23,255			18,917
Income (loss) from operations		683			(59	)		3,374			478
Non-operating income (expense):
Interest, net		134			82			273			135
Foreign exchange, net		587			(10	)		855			(53	)
Other, net		66			274			170			449
Net non-operating income		787			346			1,298			531
Income before income taxes		1,470			287			4,672			1,009
Provision (benefit) for income taxes (Note 7)		(142	)		59			(29	)		151
Net income		1,612			228			4,701			858
Net income per share
Basic (Note 3)	$	0.07		$	0.01		$	0.21		$	0.04
Diluted (Note 3)	$	0.07		$	0.01		$	0.21		$	0.04
Average shares outstanding—basic (Note 3)		22,050			21,302			21,910			21,207
Average shares outstanding—diluted (Note 3)		22,395			21,458			22,317			21,424

See accompanying notes to consolidated financial statements.

4

PLANAR SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three months ended					Six months ended
	Mar. 27, 2015			Mar. 28, 2014		Mar. 27, 2015			Mar. 28, 2014
	(In thousands)
Net income	$	1,612		$	228	$	4,701		$	858
Other comprehensive income (loss), net of taxes:
Foreign currency translation adjustments		(1,549	)		61		(2,202	)		264
Amounts reclassified from accumulated other comprehensive loss		—			—		—			—
Comprehensive income	$	63		$	289	$	2,499		$	1,122

See accompanying notes to consolidated financial statements.

5

PLANAR SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Six months ended
	Mar. 27, 2015			Mar. 28, 2014
	(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	4,701		$	858
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation		809			915
Restructuring charges		53			21
Share based compensation		1,734			788
Decrease in accounts receivable, net		3,730			305
(Increase) decrease in inventories		(4,453	)		1,655
Decrease in other assets		437			172
Increase (decrease) in accounts payable		2,320			(1,229	)
Increase (decrease) in deferred revenue		(122	)		43
Decrease in other liabilities		(2,632	)		(1,841	)
Net cash provided by operating activities		6,577			1,687
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment		(557	)		(203	)
Proceeds from Beneq receivables (Note 9)		358			—
Net cash used in investing activities		(199	)		(203	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments of capital lease obligations		(346	)		(272	)
Value of shares withheld for tax liability		(1,514	)		(355	)
Net proceeds from issuance of capital stock		26			84
Net cash used in financing activities		(1,834	)		(543	)
Effect of exchange rate changes on cash		(1,430	)		88
Net increase in cash		3,114			1,029
Cash at beginning of period		13,068			11,971
Cash at end of period	$	16,182		$	13,000

See accompanying notes to consolidated financial statements.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except per share amounts)

(Unaudited)

NOTE 1 – BASIS OF PRESENTATION

The accompanying financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.” and “U.S. GAAP”). However, certain information and footnote disclosures normally included in such financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the statements include all adjustments necessary (which are of a normal and recurring nature) for the fair presentation of the results of the periods presented. These financial statements should be read in connection with the Company’s audited financial statements for the year ended September 26, 2014. All references to a year or a quarter in these notes are to the Company’s fiscal year or quarter in the period stated.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of sales and expenses during the reporting period. Actual results may differ from those estimates.

The accompanying financial statements include the accounts of the Company and its direct and indirect wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated. The results of operations from the interim periods presented are not necessarily indicative of the operating results to be expected for any subsequent interim period or for the year ending September 25, 2015.

Recently Accounting Pronouncements

In July 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2013-11, “Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists,” (“ASU 2013-11”) which provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. ASU 2013-11 is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013. Accordingly, the Company adopted this standard during the first quarter ended December 26, 2014, see Note 7 – Income Taxes for disclosure of the impact of adopting the provisions of ASU 2013-11.

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” (“ASU 2014-09”), which provides guidance on when an entity should recognize revenue in connection with the transfer of goods or services to customers and supersedes the revenue recognition requirements in Topic 605, “Revenue Recognition”. ASU 2014-09 will be effective for public entities for annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method upon adoption of the provisions of this ASU. The Company is currently evaluating which transition method it expects to use and the impacts that adoption of this standard will have on its financial position, results of operations, and cash flows.

NOTE 2 – INVENTORIES

Inventories, stated at the lower of cost or market, consist of:

	Mar. 27, 2015		Sep. 26, 2014
Raw Materials	$	18,952	$	16,398
Work in process		195		52
Finished Goods		12,081		10,355
	$	31,228	$	26,805

NOTE 3 – EARNINGS PER SHARE

Weighted average basic shares outstanding for the three and six months ended March 27, 2015 were 22,050,000 and 21,910,000, respectively, and for the three and six months ended March 28, 2014 were 21,302,000 and 21,207,000, respectively. Diluted shares outstanding for the three and six months ended March 27, 2015 were 22,395,000 and 22,317,000, respectively, and for the three and six months ended March 28, 2014 were 21,458,000 and 21,424,000, respectively. The FASB Accounting Standards Codification^TM (“ASC”) Topic 260, “Earnings per Share,” requires that employee equity share options, nonvested shares and similar equity

7

instruments granted by the Company be treated as potential common shares in computing diluted earnings per share. Diluted shares outstanding includes the dilutive effect of in-the-money options and nonvested shares, which is calculated based on the average closing share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount that the employee must pay for exercising stock options, the amount of compensation cost for future service that the Company has not yet recognized, and the amount of tax benefits or deficiencies that would be recorded in additional paid-in capital when the award becomes deductible are assumed to be used to repurchase shares. For the three and six months ended March 27, 2015 the dilutive effect of nonvested stock awards was approximately 345,000 and 407,000, respectively. For the three and six months ended March 28, 2014 the dilutive effect of nonvested stock awards was approximately 156,000 and 217,000, respectively. There was no dilutive effect of in-the-money employee stock options for the three and six months ended March 27, 2015 or for the three and six months ended March 28, 2014. For the three and six months ended March 27, 2015, options and nonvested stock awards amounting to approximately 595,000 shares and 555,000 shares, respectively, were excluded from the calculation as their effect would have been anti-dilutive. For the three and six months ended March 28, 2014 options and nonvested stock awards amounting to approximately 678,000 shares and 815,000 shares, respectively, were excluded from the calculation as their effect would have been anti-dilutive.

NOTE 4 – SHAREHOLDERS’ EQUITY

In the second quarter of fiscal 2015 the Company adopted the 2015 Incentive Plan (the “2015 Plan”). The 2015 plan replaced the Company’s 2009 Incentive Plan and authorizes the issuance of 2,500,000 shares of common stock. In addition, up to 2,034,788 shares previously subject to awards outstanding under the Company’s 2009 Incentive Plan, the 1993 Stock Incentive Plan, the Amended and Restated 1993 Stock Incentive Plan for Nonemployee Directors, the Clarity Visual Systems, Inc. 1995 Stock Incentive Plan, the Clarity Visual Systems, Inc. Non-Qualified Stock Option Plan, the 1996 Stock Incentive Plan, the 1999 Non-Qualified Stock Option Plan, as well as any individual inducement awards, which are collectively referred to as the “Prior Plans,” became available for issuance under the 2015 Plan at the time the 2015 Plan was approved to the extent that these shares cease to be subject to the original awards (such as by expiration, cancellation or forfeiture of the awards). The maximum number of shares that may be issued under the 2015 Plan is 4,534,788 shares, including shares available from the Prior Plans.

Stock Options

The 2015 Plan provides for the granting of stock options, which generally vest and become exercisable over a three-year period and expire seven to ten years after the date of grant. Options were last granted in the second quarter of fiscal 2008.

Information regarding outstanding options is as follows:

	Number of Shares			Weighted Average Exercise Price
Options outstanding at September 26, 2014		545,636		$	8.67
Granted		—			—
Exercised		(4,402	)		5.86
Forfeited		—			—
Expired		(175,622	)		9.52
Options outstanding at March 27, 2015		365,612		$	8.30

All options outstanding at March 27, 2015 were exercisable. As of March 27, 2015, the total pretax intrinsic value of options outstanding and options exercisable was $0 and the options had a weighted average remaining contractual term of 0.6 years.

Restricted Stock

The 2015 Plan provides for the issuance of restricted stock (“nonvested shares” per ASC Topic 718, “Compensation – Stock Compensation”). Shares issued generally vest over a one to three year period upon the passage of time, or upon meeting objective performance conditions.

Information regarding outstanding restricted stock awards is as follows:

	Number of Shares			Weighted Average Grant Date Fair Value
Restricted stock outstanding at September 26, 2014		1,521,717		$	2.08
Granted		940,144			5.11
Vested		(757,541	)		2.09
Forfeited		—			—
Restricted stock outstanding at March 27, 2015		1,704,320		$	3.72

8

Valuation and Expense Information

The following table summarizes share based compensation expense related to share based payment awards and employee stock purchases for the three and six months ended March 27, 2015 and March 28, 2014. The expense was allocated as follows:

	Three months ended				Six months ended
	Mar. 27, 2015		Mar. 28, 2014		Mar. 27, 2015		Mar. 28, 2014
Cost of sales	$	66	$	21	$	143	$	46
Research and development, net	$	67	$	10	$	89	$	19
Sales and marketing		161		49		352		86
General and administrative		496		294		1,150		637
Share based compensation expense included in operating expenses	$	724	$	353	$	1,591	$	742
Share based compensation expense related to employee stock options, restricted stock awards and employee stock purchase plan	$	790	$	374	$	1,734	$	788

The Company recognizes compensation expense for all share based payment awards made to its employees and directors including employee stock options, restricted stock awards and employee stock purchases related to the Employee Stock Purchase Plan, based on estimated fair values. The Company calculates the value of employee stock options on the date of grant using the Black-Scholes model. The Company values restricted stock awards at the closing price of the Company’s shares on the date of grant. As share based compensation expense recognized in the Consolidated Statement of Operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures were estimated based on historical and anticipated future experience.

NOTE 5 – RESTRUCTURING CHARGES

For the three and six months ended March 27, 2015, the Company recorded $13 and $23, respectively, in accretion of interest expense related to the liability recorded in fiscal 2013 and revised in fiscal 2014 associated with the consolidation of the Company’s two assembly and integration facilities in the United States into a single facility. For the three and six months ended March 28, 2014 the Company recorded $10 and $21, respectively, in accretion of interest expense related to the liability recorded in fiscal 2013 associated with this action. The remaining liability from this action is included in other current liabilities and other long-term liabilities. For the three months ended March 27, 2015, the Company also recorded $30 in restructuring charges related to severance benefits for the termination of certain employees at the Company’s facility in France.

Restructuring charges related to previously recorded charges affected the Company’s financial position as follows:

	Accrued Compensation			Other Current Liabilities			Other Long-term Liabilities
Balance as of September 26,2014	$	16		$	705		$	1,662
Additional charges		30		$	—		$	—
Accretion of interest expense		—			23			—
Cash paid		(41	)		(358	)		—
Reclassification from other long-term liabilities to other current liabilities		—			341			(341	)
Balance as of March 27, 2015	$	5		$	711		$	1,321

NOTE 6 – OTHER CURRENT LIABILITIES

Other current liabilities consist of:

	Mar. 27, 2015		Sep. 26, 2014
Warranty Reserve	$	3,407	$	3,319
Accrued Compensation		3,051		4,407
Other		4,412		5,248
Total	$	10,870	$	12,974

9

The Company provides a warranty for its products and establishes an allowance at the time of sale which the Company believes, based on its best estimates, is sufficient to cover costs during the warranty period. The warranty period is generally between 12 and 36 months. This reserve is included in other current liabilities.

A reconciliation of the changes in the warranty reserve is as follows:

	Mar. 27, 2015
	Three months ended			Six months ended
Balance at beginning of period	$	3,406		$	3,319
Cash paid for warranty repairs		(1,608	)		(3,100	)
Provision for current period sales		1,609			3,188
Balance at end of period	$	3,407		$	3,407

NOTE 7 – INCOME TAXES

The provision for income taxes for the second quarter of fiscal 2015 was recorded based upon the current estimate of the Company’s annual effective tax rate. Generally, the provision for income taxes is the result of a mix of profits and losses the Company and its subsidiaries earn in tax jurisdictions with a broad range of income tax rates. The tax benefit of $142 and $29 for the three and six months ended March 27, 2015, respectively, were generated by the recognition in the second quarter of previously unrecognized foreign tax benefits partially offset by other foreign and state taxes. The tax provisions of $59 and $151 for the three and six months ended March 28, 2014, respectively were generated by a mix of tax expense in foreign jurisdictions and state taxes.

For the three months ended March 27, 2015 the effective tax rate benefit of 9.7% differs from the federal statutory rate due to the generation of income in jurisdictions utilizing NOL’s which previously had valuation allowances recorded against them and the reversal of foreign uncertain tax provisions due to the expiration of the statute of limitations. For the six months ended March 27, 2015 the effective tax rate benefit of 0.6% also differs from the federal statutory rate due to the generation of income in jurisdictions utilizing NOL’s which previously had valuation allowances recorded against them and the recognition of foreign uncertain taxes due to the expiration of the statute of limitations, offset by other foreign and state taxes.

Each quarter the Company assesses and evaluates a number of factors in determining whether the weight of available evidence supports the recognition of some or all of the deferred tax assets. The Company establishes a valuation allowance for deferred tax assets when it is more likely than not that such deferred tax assets will not be realized. In fiscal 2007 the Company determined that a valuation allowance should be recorded against all of its U.S. deferred tax assets, and in the third quarter of fiscal 2012 the Company recorded a valuation allowance against its Finnish deferred tax assets due to its cumulative three year operating loss in Finland. As of March 27, 2015 the Company continued to place a valuation allowance against its U.S. and Finnish deferred tax assets. While a valuation allowance was still in place for financial statement purposes as of March 27, 2015, the valuation allowance does not limit the Company’s ability to utilize the loss-carryforwards or other deferred tax assets on future tax returns.

During the first quarter of fiscal 2015 the Company adopted ASU 2013-11. The Company presents an unrecognized tax benefit as a reduction to a deferred tax asset for a net operating loss carryforward. The adoption of ASU 2013-11 had no impact on the Company’s Consolidated Statements of Income. The adoption of ASU 2013-11 impacted the Consolidated Balance Sheet presentation of unrecognized tax benefits at March 27, 2015 by reducing other current assets and other assets by $117 and $457 respectively, and by reducing other long-term liabilities by $574.

During the three months ended March 27, 2015 there was a $201 reduction to the amount of uncertain tax positions, which was included as a benefit to the tax provision, as a result of the expiration of the statute of limitations in foreign jurisdictions. The Company is subject to taxation primarily in the United States, Finland, and France, as well as in certain states (including Oregon and California) and other foreign jurisdictions. The Company’s larger jurisdictions generally provide for statutes of limitations from three to five years. The Company has effectively settled with the Internal Revenue Service on their examination of all United States federal income tax matters through fiscal year 2008. The Company has also settled examinations of both its Finnish tax returns for all tax years through 2007, as well as its French tax returns through fiscal year 2010.

NOTE 8 – BORROWINGS

The Company’s credit agreement allows for borrowing up to 80% of its eligible accounts receivable with a maximum borrowing capacity of $12.0 million. The credit agreement has interest rates ranging from LIBOR + 2.25% to Prime + 0.75%, expires on November 21, 2015, and is secured by substantially all of the assets of the Company. As of March 27, 2015 the Company’s borrowing capacity was $12.0 million. There were no amounts outstanding under the Company’s credit agreement as of March 27, 2015 and September 26, 2014. The credit agreement contains certain financial covenants, with which the Company was in compliance as of March 27, 2015.

10

NOTE 9 – BENEQ RECEIVABLES

In fiscal 2013 the Company sold the assets and liabilities associated with its electroluminescent (“EL”) product line to Beneq Products Oy (“Beneq Products”) for a base sale price of $6.5 million, of which $3.9 million was paid in cash at closing, with the remaining $2.6 million held as two promissory notes (collectively, “Purchase Price Note”). The term of the note is five years with principal payments due annually beginning in November 2014. The note accrues interest at 10% annually, with interest payments due in advance on the first day of each month.

In October 2014, Beneq Products informed the Company that it would not pay, when due on November 30, 2014, the first principal payment of $0.7 million due under the Purchase Price Note. Beneq Products sought to exercise its right under the Purchase Price Note to reschedule, on a single occasion, the due date of a payment to a date not later than 180 days after the November 30, 2014 due date and requested that the Company agree to waive the penalty interest payable under the Purchase Price Note in connection with the exercise of its right to delay payment. Under the terms of the Purchase Price Note, Beneq Products had agreed that, upon its exercise of the right to delay payment, it would pay a penalty equal to 12 months interest on the entire loan balance. The Company agreed to allow Beneq Products to exercise its right to delay repayment of the initial principal payment for up to 180 days in consideration for the payment of penalty interest equal to an additional 2% on the deferred balance in lieu of the penalty amount set forth in the Purchase Price Note.

Under the terms of the sale of assets agreement entered into by the Company in conjunction with the sale of the assets and liabilities associated with the EL product line, the Company transferred to Beneq Products certain non-cancelable component purchase commitments with third party vendors. Subsequent to the closing of the transaction, the Company learned that a vendor would not cooperate in the transfer to Beneq Products of such purchase commitments and demanded performance by Planar. In the third quarter of 2014, the Company entered into an agreement with this vendor (“Vendor Agreement”) related to such purchase commitments. As a part of the Vendor Agreement, the Company agreed to take delivery and ownership of €2.9 million ($3.9 million based on the EUR to USD exchange rate as of the agreement date) of electronic component devices. Delivery of these components and payment to the vendor were both completed in the third quarter of 2014. In the third quarter of 2014, the Company also entered into a settlement agreement (“Settlement Agreement”) with Beneq Products and Beneq Oy, the parent company of Beneq Products (collectively “Beneq”) establishing the terms under which the component inventory will be transferred to and paid for by Beneq (“Component Device Receivable”).

The Purchase Price Note and the Component Device Receivable are included in other current assets and other assets as of March 27, 2015 and September 26, 2014.

Other current assets consist of:

	Mar. 27, 2015		Sep. 26, 2014
Purchase Price Note Receivable from Beneq, current portion	$	1,300	$	650
Component Device Receivable from Beneq, current portion		492		382
Other		3,243		2,877
Total	$	5,035	$	3,909

Other assets consist of:

	Mar. 27, 2015		Sep. 26, 2014
Purchase Price Note Receivable from Beneq, non-current portion	$	1,300	$	1,950
Component Device Receivable from Beneq, non-current portion		1,857		2,741
Other		1,708		2,559
Total	$	4,865	$	7,250

Management has reviewed the total $4.9 million due from Beneq. Given Beneq Oy’s guarantee of the obligations of Beneq Products under the Purchase Price Note, the Company’s security interest in assets of each of Beneq Products and Beneq Oy and information provided by Beneq relating to its efforts to take actions that would enhance its ability to perform the obligations under the Purchase Price Note and the Settlement Agreement, the Company continues to believe the receivables due from Beneq are appropriately valued based on the Company’s best estimate of collectability. Based on this evaluation, the Company has determined that as of March 27, 2015 the total receivables due from Beneq (the Purchase Price Note and the Component Device Receivable) were collectible and appropriately valued on the Company’s balance sheet as of that date. Accordingly, no allowance has been recorded against these receivables.

11

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following information should be read in conjunction with the consolidated interim financial statements and the notes thereto in Part I, Item 1 of this Quarterly Report and with the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in the Company’s Annual Report on Form 10-K for the year ended September 26, 2014.

FORWARD-LOOKING STATEMENTS

This Management’s Discussion and Analysis of Financial Condition and Results of Operations and other sections of this Report include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are made pursuant to the safe harbor provisions of the federal securities laws. Forward-looking statements, which may be identified by the inclusion of words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “goal” and variations of such words and other similar expressions, are based on current expectations, estimates, assumptions and projections that are subject to change, and actual results may differ materially from the forward-looking statements. Forward-looking statements include, among others: expectations about the growth of the digital signage display market; beliefs about and continued focus on digital signage products and efforts to transition the Company’s focus, strategic direction, and resources; work to diversify the Company’s supplier base; expectations regarding the future impact of accounting measures; beliefs about the Company’s warranty reserve and tax allowances and positions; and the collectability of the purchase price note and component device receivable due from Beneq. These statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict. Many factors, including the risk factors included in Part II, Item 1A of this Report and the following, could cause actual results to differ materially from the forward-looking statements: poor or weakened domestic and international business and economic conditions; changes or reductions in the demand or order rates for products in the various display markets served by the Company; any delay in the timing of customer orders or the Company’s ability to ship product upon receipt of a customer order; the extent and timing of any additional expenditures by the Company to address business growth opportunities; any inability to reduce costs or to do so quickly enough, in either case, in response to reductions in revenue; the ability of the Company to successfully implement any cost reduction initiatives or generally cause ongoing operating expenses to be maintained at levels permitting Company profitability; adverse impacts on the Company or its operations relating to or arising from any inability to fund desired expenditures, including due to difficulties in obtaining necessary financing; changes in the flat-panel monitor and digital signage industry; changes in customer demand or ordering patterns; changes in the competitive environment including pricing pressures or the ability to keep pace with technological changes; technological advances; shortages of manufacturing capacity from the Company’s third-party manufacturing partners or other interruptions in the supply of components the Company incorporates in its finished goods including as a result of existing work slowdowns at certain U.S. West Coast ports or other labor unrest at import facilities and natural disasters and future production variables resulting in excess inventory. The forward-looking statements contained in this Report speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this Report. If the Company does update one or more forward-looking statements, it should not be concluded that the Company will make additional updates with respect thereto or with respect to other forward-looking statements.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Company reaffirms the critical accounting policies and use of estimates reported in its Form 10-K for the year ended September 26, 2014.

INTRODUCTION

Planar Systems, Inc. is a global leader in display and digital signage technology, providing premier solutions for the world’s most demanding environments. Retailers, educational institutions, government agencies, businesses, utilities and energy firms, and home theater enthusiasts all depend on Planar to provide superior performance when image experience is of the highest importance. Planar video walls, large format liquid crystal displays (“LCD”), interactive touch screen monitors, and many other solutions are used by the world’s leading organizations in applications ranging from digital signage to simulation and from interactive kiosks to large-scale data visualization. The Company has a global reach with sales offices in North America, Europe, and Asia and manufacturing facilities in the United States and France.

The electronic specialty display industry is driven by the proliferation of display products, from both the increase in functionality in “smart” devices and the availability and versatility of LCD flat panel displays at increasingly lower costs; the ongoing need for system providers and integrators to rely on display experts to provide customized solutions; and the growth in the market for targeted marketing and messaging to consumers using digital signage in a variety of form factors in both indoor and outdoor applications.

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Unless context otherwise requires, or as otherwise indicated, “we,” “us,” “our” and similar terms, as well as references to the “Company” and “Planar,” refer to Planar Systems, Inc. and, unless the context requires otherwise, include all of the Company’s consolidated subsidiaries.

The Company’s Strategy

For over 30 years, Planar has been designing and bringing to market innovative display solutions. The Company has historically focused on customized or specialty display products and systems, generally in niche display markets where requirements are more stringent, innovation is valued, and the customer is not served or is underserved by the mass-market, commodity display providers. In recent years, the Company has been transitioning its focus, strategic direction, and resources to target the larger and faster-growing market for digital signage displays, where a variety of its customers and end users use the Company’s tiled LCD systems and large format stand-alone signage monitors for digital signage applications in retail, airport, sports arena and stadium, hospitality, corporate and higher-education venues, as well as in applications that have traditionally used customized or specialty display products and systems, including control rooms.

The Company’s Markets and Products

Planar delivers display products and related solutions for a wide variety of applications and vertical markets. It categorizes the products into two areas, “Digital Signage” and “Commercial and Industrial,” and markets and sells its products under the Planar, Clarity, and Runco brands.

Digital Signage

The digital signage display market has experienced growth in recent years and the Company expects that the digital signage display market will continue to grow in the future. Digital signage solutions are being installed in many environments including retail locations, airports, and sports arenas, as well as emerging applications and in applications historically served by Commercial and Industrial products, including rear-projection cubes. Planar provides solutions for a number of display applications in the digital signage display market utilizing a variety of technologies and products.

• Tiled LCD Systems (Matrix and Mosaic): Planar’s ultra-narrow bezel LCD display systems allow customers to create flat, large video walls for a number of applications including ambience, advertising, architectural and brand promotion. These systems are being deployed in a wide range of markets including retail, hospitality, commercial, sports venues and airports, as well as in markets traditionally served by rear-projection cubes, such as control rooms. Planar’s solutions utilize specialized LCD panels and “tile” them together using video processing to create large video wall displays. Products offered are well suited to these applications as they are designed for simple installation, easy and cost effective maintenance and off-boarding of power and video processing. The Company offers and supports a growing number of sizes and resolutions of ultra-narrow bezel displays, including touch panels, which can be utilized in creating a wide variety of video wall solutions. Beginning in the three month period ended December 26, 2014, the sales of tiled LCD systems also includes sales of Visual Control Stations (“VCS”) video processing solutions that were previously reported in the sales of rear-projection cube displays. During the three months ended March 27, 2015 the Company debuted the new Planar DirectLight LED Video Wall System, which will provide exceptional visual performance, thin mounting depth, precise alignment, reliability, and adaptability to different customer uses and addresses the increasing demand for seamless, high-quality video walls. The Company expects to begin shipping the DirectLight LED Video Wall systems in the fourth quarter ended September 25, 2015.

• Signage Monitors: Planar provides a line-up of commercial-grade LCD displays, including the zero bezel “UltraLux” and Ultra HD “UltraRes” product offerings, which are suitable for a wide range of digital signage uses. This category also includes other stand-alone signage monitors, outdoor signage displays, transparent displays, and customized LCD signage solutions for customers with requirements that go beyond those available from off-the-shelf products.

Commercial and Industrial

The Commercial and Industrial display markets that the Company addresses are varied and numerous and some of these markets are relatively mature. The Company serves these markets with a wide range of solutions including standard as well as highly differentiated custom display products and systems.

• Custom Commercial and Industrial Displays: Planar designs and manufactures custom LCD products that are generally targeted toward the transportation, military and natural resource exploration vertical markets. These displays are typically ruggedized to withstand extreme weather, direct sunlight, moisture, dust, vibration and other extreme conditions.

• Desktop Monitor Displays: Planar capitalizes on its strong supply chain, logistics and distribution partnerships to sell a variety of LCD based displays principally to the United States marketplace.

• Touch Monitor Displays: Planar markets a wide variety of desktop touch LCD products for use in kiosks, point of sale applications, and other applications.

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• Rear-Projection Cube Displays: The market for control room video wall solutions is driven by the development, expansion, and upgrade of industrial infrastructure such as power plants, transportation systems, communication systems, and security monitoring. Planar provides premium quality rear-projection displays and video processing solutions that meet the customer’s needs for virtually seamless video walls that support 24x7 operations.

• High-End Home Displays: Planar offers a wide variety of high-performance home theater front-projection systems, video processing equipment, and accessories, largely aimed at the high-end home market and certain commercial installations. The Company has sold these products under the Runco brand since May 2007 when it acquired Runco International, an industry leader in high-end, luxury video products. Planar’s Runco products are primarily sold to its established network of custom home installation dealers in the United States.

Overview of Results

In the three and six months ended March 27, 2015, the Company continued to experience strong demand for its digital signage products as the Company achieved significant growth in its digital signage product offerings, including UltraRes, tiled LCD systems, and a portfolio of LCD commercial flat panel displays. The Company believes the overall market for digital signage products is currently growing and will continue to grow in the future.

The Company recorded sales of $49.1 million in the three months ended March 27, 2015 (the “second quarter of 2015”), which was an increase of $8.0 million or 19.7% as compared to sales of $41.1 million in the three months ended March 28, 2014 (the “second quarter of 2014”). The increase in sales in the second quarter of 2015 as compared to the second quarter of 2014 was primarily the result of a $5.9 million or 31.6% increase in sales of digital signage products to $24.9 million in the second quarter of 2015 from $19.0 million in the second quarter of 2014. This increase was also due to a $2.1 million or 9.5% increase in sales of commercial and industrial products to $24.2 million in the second quarter of 2015 from $22.1 million in the second quarter of 2014. In the six months ended March 27, 2015 (the “first six months of 2015”), sales were $104.9 million, which was an increase of $23.4 million or 28.7% as compared to sales of $81.5 million in the six months ended March 28, 2014 (the “first six months of 2014”). The increase in sales in the first six months of 2015 as compared to the first six months of 2014 was primarily due to a $16.8 million or 44.2% increase in sales of digital signage products to $54.7 million in the first six months of 2015 from $37.9 million in the first six months of 2014. This increase was also due to a $6.6 million or 15.2% increase in sales of commercial and industrial products to $50.2 million from $43.6 million in the first six months of 2014.

Income from operations was $0.7 million in the second quarter of 2015 as compared to a $0.1 million loss from operations in the second quarter of 2014. For the first six months of 2015 income from operations was $3.4 million as compared to $0.5 million in the first six months of 2014. The improvement in income from operations in the second quarter of 2015 as compared to the second quarter of 2014 was due primarily to an increase in gross profit of $2.5 million or 26.5%, which was partially offset by an increase in operating expenses of $1.8 million or 18.7%. The improvement in income from operations in the first six months of 2015 as compared to the first six months of 2014 was due primarily to an increase in gross profit of $7.2 million or 37.3%, which was partially offset by an increase in operating expenses of $4.3 million or 22.9%. The increase in gross profit in both the three month and six month periods ended March 27, 2015 was primarily the result of lower labor and overhead expenses as a percentage of revenue driven by improved capacity utilization, increased sales of digital signage products and higher gross profit rates on these sales as compared to the same periods of 2014, as well as a change in the mix of products sold towards higher margin digital signage products, as the Company continued to execute its strategy to focus on the market for digital signage products. The increase in operating expenses in the second quarter of 2015 was primarily driven by a $1.1 million increase in sales and marketing expenses and a $0.5 million increase in general and administrative expenses. The increase in operating expenses in the first six months of 2015 was primarily driven by a $2.6 million increase in sales and marketing expenses, a $1.2 million increase in general and administrative expenses, and a $0.5 million increase in net research and development expenses.

Net income was $1.6 million or $0.07 per basic and diluted share in the second quarter of 2015 as compared to $0.2 million or $0.01 per basic and diluted share in the second quarter of 2014. For the first six months of 2015 net income was $4.7 million or $0.21 per basic and diluted share as compared to $0.9 million or $0.04 per basic and diluted share in the first six months of 2014. The improvement in net income for the three and six months ended March 27, 2015 was due primarily to the improvement in income from operations as well as an increase in net non-operating income in both periods due to the reasons discussed below.

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Sales

Sales for the Three Months Ended March 27, 2015

For the three months ended March 27, 2015, the Company’s sales increased $8.0 million or 19.7% to $49.1 million from $41.1 million for the three months ended March 28, 2014. The increase was due to an increase in sales of both digital signage products and commercial and industrial products. The increase in sales of digital signage products of $5.9 million or 31.6% was due primarily to an increase in the sales of tiled LCD video wall systems and an increase in the average selling prices (“ASPs”) of signage monitors, which was driven by a shift in the mix of products sold towards higher priced larger format displays. The increase in sales of commercial and industrial products of $2.1 million or 9.5% was due primarily to an increase in the ASPs of custom displays, an increase in the sales volume of desktop monitors, and an increase in sales volume of rear-projections cubes. These increases were partially offset by a decrease in sales of high-end home products and touch monitors. A summary of the major components of sales for the second quarter of 2015, including changes in sales from the second quarter of 2014 due to changes in volumes and ASPs is as follows:

Sales for the Three Months Ended March 27, 2015

	Three months ended				$ Change			% Change			% Change in Volumes(1)			% Change in ASPs(1)
	Mar. 27, 2015		Mar. 28, 2014
	(In millions, except percentages)
Digital Signage Product Sales
Tiled LCD systems	$	14.7	$	12.9	$	1.8			13.9	%		7.6	%		5.8	%
Signage monitors		10.2		6.1		4.1			69.4	%		1.2	%		67.3	%
Total Digital Signage Product Sales		24.9		19.0		5.9			31.6	%		—			—
Commercial & Industrial Sales
Custom commercial & industrial		7.0		4.7		2.3			47.6	%		-39.0	%		149.8	%
Desktop monitors		9.2		7.7		1.5			18.8	%		19.3	%		1.4	%
Touch monitors		2.8		3.7		(0.9	)		-24.4	%		-17.4	%		-7.1	%
Rear-projection cubes		4.4		4.1		0.3			6.3	%		39.7	%		-9.3	%
High-end home		0.8		1.7		(0.9	)		-50.9	%		-42.6	%		-28.3	%
Other		—		0.2		(0.2	)		-84.8	%		—			—
Total Commercial & Industrial Sales		24.2		22.1		2.1			9.5	%		—			—
Total Sales	$	49.1	$	41.1	$	8.0			19.7	%		—			—

⁽¹⁾  Due to the significant differences in volumes and ASPs for each product category, changes in volumes and ASPs have not been included for the “Other” categories or subtotals.

For the three months ended March 27, 2015, the increase in volumes sold of tiled LCD video wall systems, including Matrix and Mosaic, was due primarily to the continued increased demand for indoor video wall systems, while the increase in ASPs of tiled LCD video wall systems was due primarily to a change in the mix of products sold towards higher priced larger format Matrix products. The increase in ASPs of signage monitors was due primarily to a change in the mix of products sold towards higher priced large format UltraRes products. The increase in ASPs of custom commercial and industrial products was due primarily to a shift in the mix of products sold in the second quarter of 2015 towards certain custom products with higher ASPs as compared to the custom products that were sold in the second quarter of 2014. The decrease in volumes sold of custom commercial and industrial products was due primarily to fewer custom orders in the second quarter of 2015 as compared to the second quarter of 2014. The increase in volumes sold of desktop monitors was due to increased customer demand. The increase in the sales volume and the decrease in the ASPs of rear-projection cubes was primarily the result of a large order for rear-projection cubes in the second quarter of 2015 at a lower ASP than rear-projection cubes that were sold in the second quarter of 2014. The decrease in high-end home product volumes sold was due to continued declines in demand for high-end projection home theater systems, while the decrease in high-end home ASPs was due primarily to a change in the mix of products sold toward lower priced product offerings. The decrease in the volumes sold of touch monitors was primarily the result of lower overall customer demand, while the decrease in ASPs of touch monitors was due primarily to a change in the mix of products sold towards lower priced product offerings in the second quarter of 2015 as compared to the second quarter of 2014.

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Sales for the Six Months Ended March 27, 2015

For the six months ended March 27, 2015, the Company’s sales increased $23.4 million or 28.7% to $104.9 million from $81.5 million for the six months ended March 28, 2014. The increase was due to increases in sales of both digital signage products and commercial and industrial products. The increase in sales of digital signage products of $16.8 million or 44.2% was due primarily to an increase in the sales volume of tiled LCD video wall systems, which was driven by increased demand for indoor video wall systems, and an increase in the ASPs of signage monitors, which was driven by a shift in the mix of products sold towards higher priced larger format displays. The increase in sales of commercial and industrial products of $6.6 million or 15.2% was due primarily to an increase in the ASPs of custom displays and an increase in the sales volume of desktop monitors. These increases were partially offset by a decrease in sales of high-end home products and touch monitors. A summary of the major components of sales for the first six months of 2015, including changes in sales from the first six months of 2014 due to changes in volumes and ASPs is as follows:

Sales for the Six Months Ended March 27, 2015

	Six months ended				$ Change			% Change			% Change in Volumes(1)			% Change in ASPs(1)
	Mar. 27, 2015		Mar. 28, 2014
	(In millions, except percentages)
Digital Signage Product Sales
Tiled LCD systems	$	35.7	$	26.4	$	9.3			35.2	%		40.2	%		-3.5	%
Signage monitors		19.0		11.5		7.5			64.9	%		-2.9	%		69.8	%
Total Digital Signage Product Sales		54.7		37.9		16.8			44.2	%		—			—
Commercial & Industrial Sales
Custom commercial & industrial		15.3		8.0		7.3			90.5	%		-26.2	%		167.8	%
Desktop monitors		18.4		15.8		2.6			16.5	%		18.8	%		0.1	%
Touch monitors		5.7		6.9		(1.2	)		-18.0	%		-10.9	%		-5.9	%
Rear-projection cubes		9.2		9.1		0.1			0.9	%		21.8	%		-9.0	%
High-end home		1.6		3.4		(1.8	)		-51.0	%		-47.7	%		-18.9	%
Other		—		0.4		(0.4	)		-91.3	%		—			—
Total Commercial & Industrial Sales		50.2		43.6		6.6			15.2	%		—			—
Total Sales	$	104.9	$	81.5	$	23.4			28.7	%		—			—

⁽¹⁾  Due to the significant differences in volumes and ASPs for each product category, changes in volumes and ASPs have not been included for the “Other” categories or subtotals.

For the six months ended March 27, 2015, the increase in volumes sold of tiled LCD video wall systems, including Matrix and Mosaic, was due primarily to increased demand for indoor video wall systems. The decrease in ASPs of tiled LCD video wall systems was due primarily to a change in the mix of products sold during the first quarter of 2015 towards certain Matrix products with lower ASPs, partially offset by the increase in ASPs in the second quarter of 2015 due primarily to a change in the mix of products sold towards higher priced larger format Matrix products. The increase in ASPs of signage monitors was due primarily to a change in the mix of products sold towards higher priced large format UltraRes products, while the decrease in volumes sold of signage monitors was due to decreased customer demand for touch signage products. The increase in ASPs of custom commercial and industrial products was due primarily to a shift in the mix of products sold in the first six months of 2015 towards certain custom products with higher ASPs as compared to the custom products that were sold in the first six months of 2014. The decrease in volumes sold of custom commercial and industrial products was due primarily to fewer custom orders in the first six months of 2015 as compared to the first six months of 2014. The increase in volumes sold of desktop monitors was due to increased customer demand for desktop monitors. The decrease in high-end home product volumes sold was due to continued declines in demand for high-end projection home theater systems, while the decrease in high-end home ASPs was due primarily to a change in product mix toward lower priced product offerings. The decrease in the volumes sold of touch monitors was primarily the result of lower overall customer demand, while the decrease in ASPs of touch monitors was due primarily to a change in the mix of products sold toward lower priced product offerings in the first six months of 2015 as compared to the first six months of 2014.

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Sales by Geographic Region

										% of Total Sales
	Three months ended									Three months ended
	Mar. 27, 2015		Mar. 28, 2014		$ Change		% Change			Mar. 27, 2015			Mar. 28, 2014
	(In millions, except percentages)
Domestic sales (United States)	$	36.4	$	30.6	$	5.8		19.2	%		74.1	%		74.5	%
International sales		12.7		10.5		2.2		21.2	%		25.9	%		25.5	%
Total sales	$	49.1	$	41.1	$	8.0		19.7	%

Domestic (United States) sales increased $5.8 million or 19.2% to $36.4 million in the second quarter of 2015 from $30.6 million in the second quarter of 2014. The increase in domestic sales for the three months ended March 27, 2015 was due primarily to an increase in sales of digital signage products, custom commercial and industrial products, and desktop monitors, which was partially offset by a decrease in sales of rear-projection cubes, high-end home products, and touch monitors. These increases and decreases in domestic product sales were primarily due to the reasons discussed above in Sales for the Three Months Ended March 27, 2015. As a percentage of sales, domestic sales decreased to 74.1% in the second quarter of 2015 from 74.5% in the second quarter of 2014. International sales increased $2.2 million or 21.2% to $12.7 million in the second quarter of 2015 from $10.5 million in the second quarter of 2014. The increase in international sales for the three months ended March 27, 2015 was primarily due to an increase in sales of custom commercial and industrial products and rear-projection cubes sold outside of the United States, partially offset by the effect of changes in currency exchange rates due primarily to the strengthening of the U.S. Dollar against the Euro. As a percentage of sales, international sales increased to 25.9% in the second quarter of 2015 from 25.5% in the second quarter of 2014. The Company does not have material sales to any particular country outside the United States.

										% of Total Sales
	Six months ended									Six months ended
	Mar. 27, 2015		Mar. 28, 2014		$ Change		% Change			Mar. 27, 2015			Mar. 28, 2014
	(In millions, except percentages)
Domestic sales (United States)	$	78.9	$	61.8	$	17.1		27.7	%		75.2	%		75.8	%
International sales		26.0		19.7		6.3		31.9	%		24.8	%		24.2	%
Total sales	$	104.9	$	81.5	$	23.4		28.7	%

Domestic (United States) sales increased $17.1 million or 27.7% to $78.9 million in the first six months of 2015 from $61.8 million in the first six months of 2014. The increase in domestic sales for the six months ended March 27, 2015 was due primarily to increases in sales of digital signage products, custom commercial and industrial products, and desktop monitors, which were partially offset by a decrease in sales of rear-projection cubes, high-end home products, and touch monitors. These increases and decreases in the domestic product sales were primarily due to the reasons discussed above in Sales for the Six Months Ended March 27, 2015. As a percentage of sales, domestic sales decreased to 75.2% in the first six months of 2015 from 75.8% in the first six months of 2014. International sales increased $6.3 million or 31.9% to $26.0 million in the first six months of 2015 from $19.7 million in the first six months of 2014. The increase in international sales for the six months ended March 27, 2015 was primarily due to an increase in sales of custom commercial and industrial products and rear-projection cubes sold outside of the United States, partially offset by the effect of changes in currency exchange rates due primarily to the strengthening of the U.S. Dollar against the Euro. As a percentage of sales, international sales increased to 24.8% in the first six months of 2015 from 24.2% in the first six months of 2014. The Company does not have material sales to any particular country outside the United States.

Gross Profit

	Three months ended											Six months ended
	Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change			Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change
	(In millions, except percentage and basis point changes)
Gross profit	$	12.2		$	9.7		$	2.5		26.5	%	$	26.6		$	19.4		$	7.2		37.3	%
Gross profit margin		24.9	%		23.5	%		—		140bps			25.4	%		23.8	%		—		160bps

Gross profit as a percentage of sales increased to 24.9% in the second quarter of 2015 from 23.5% in the second quarter of 2014. Total gross profit increased $2.5 million or 26.5% to $12.2 million in the second quarter of 2015 as compared to $9.7 million in the second quarter of 2014. In the first six months of 2015 gross profit as a percentage of sales increased to 25.4% from 23.8% in the first

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six months of 2014. Total gross profit increased $7.2 million or 37.3% to $26.6 million in the first six months of 2015 as compared to $19.4 million in the first six months of 2014. The increase in gross profit margin for both the three month and six months periods ended March 27, 2015 was due primarily to lower labor and overhead expenses as a percentage of sales driven by improved capacity utilization, increased sales of digital signage products and higher gross profit rates on these sales as compared to the same periods of the prior year, as well as a change in the mix of products sold towards higher margin digital signage products, as the Company continued to execute its strategy to focus on the market for digital signage products. The higher digital signage gross profit rates were primarily the result of a change in the mix of digital signage products sold toward larger format products which have higher margins.

Research and Development, Net

	Three months ended											Six months ended
	Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change			Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change
	(In millions, except percentage and basis point changes)
Research and development, net	$	1.6		$	1.5		$	0.1		9.3	%	$	3.2		$	2.7		$	0.5		19.4	%
% of sales		3.3	%		3.6	%		—		(30) bps			3.1	%		3.3	%		—		(20) bps

Net research and development expenses increased $0.1 million or 9.3% to $1.6 million in the second quarter of 2015 as compared to $1.5 million in the second quarter of 2014. Net research and development expenses increased $0.5 million or 19.4% to $3.2 million in the first six months of 2015 as compared to $2.7 million in the first six months of 2014. The increase for both the three and six month periods ended March 27, 2015 was due primarily to increased compensation related expenses driven by increased headcount as compared to the first three and six month periods ended March 28, 2014, as well as increased project related expenses.

As a percentage of sales, net research and development expenses decreased to 3.3% in the second quarter of 2015 as compared to 3.6% in the second quarter of 2014. In the first six months of 2015, net research and development expenses were 3.1% of sales as compared to 3.3% of sales in the first six months of 2014. The decrease in net research and development expenses as a percentage of sales for the second quarter of 2015 and for the first six months of 2015 was primarily the result of net research and development expenses increasing at a slower rate than sales in both periods.

Sales and Marketing

	Three months ended											Six months ended
	Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change			Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change
	(In millions, except percentage and basis point changes)
Sales and marketing	$	6.2		$	5.1		$	1.1		22.1	%	$	12.3		$	9.7		$	2.6		26.0	%
% of sales		12.5	%		12.3	%		—		20bps			11.7	%		11.9	%		—		(20) bps

Sales and marketing expenses increased $1.1 million or 22.1% to $6.2 million in the second quarter of 2015 as compared to $5.1 million in the second quarter of 2014. Sales and marketing expenses increased $2.6 million or 26.0% to $12.3 million in the first six months of 2015 as compared to $9.7 million in the first six months of 2014. The increase for both the three and six months ended March 27, 2015 was due primarily to increased headcount to support the growth in sales as well as increased compensation related expenses and higher sales and marketing program spending.

As a percentage of sales, sales and marketing expenses increased to 12.5% in the second quarter of 2015 as compared to 12.3% in the same period of the prior year. The increase in sales and marketing expenses as a percentage of sales for the second quarter of 2015 was primarily the result of sales and marketing expenses increasing at a faster rate than sales. In the first six months of 2015, sales and marketing expenses were 11.7% of sales as compared to 11.9% of sales in the first six months of 2014. The decrease in sales and marketing expenses as a percentage of sales for the first six months of 2015 was primarily the result of sales and marketing expenses increasing at a slower rate than sales.

18

General and Administrative

	Three months ended											Six months ended
	Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change			Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change
	(In millions, except percentage and basis point changes)
General and administrative	$	3.7		$	3.2		$	0.5		16.7	%	$	7.7		$	6.5		$	1.2		19.4	%
% of sales		7.6	%		7.8	%		—		(20) bps			7.3	%		7.9	%		—		(60) bps

General and administrative expenses increased $0.5 million or 16.7% to $3.7 million in the second quarter of 2015 from $3.2 million in the second quarter of 2014. General and administrative expenses increased $1.2 million or 19.4% to $7.7 million in the first six months of 2015 as compared to $6.5 million in the first six months of 2014. The increase in general and administrative expenses for both the three and six month periods ended March 27, 2015 was due primarily to increased compensation and professional service expenses.

As a percentage of sales, general and administrative expenses decreased to 7.6% in the second quarter of 2015 as compared to 7.8% in the second quarter of 2014. In the first six months of 2015, general and administrative expenses were 7.3% of sales as compared to 7.9% of sales in the first six months of 2014. The decrease in general and administrative expenses as a percentage of sales was primarily the result of general and administrative expenses increasing at a slower rate than sales in both periods.

Restructuring Charges

During the second quarter of 2015 and second quarter of 2014, the Company recorded $43 thousand and $10 thousand, respectively, in restructuring charges. In the first six months of 2015 and 2014 the Company recorded $53 thousand and $21 thousand, respectively, in restructuring charges. As discussed in Note 5—Restructuring Charges, $13 thousand and $23 thousand of the charges recorded for the second quarter and first six months of 2015, respectively, as well as all of the restructuring charges recorded in the second quarter and first six months of 2014 were the result of accretion of interest expense related to the liability recorded in fiscal 2013 and adjusted in fiscal 2014 related to the consolidation of the Company’s two assembly and integration facilities in the United States into a single facility. For the three months ended March 27, 2015, the Company recorded $30 thousand in charges related to severance benefits for the termination of certain employees at the Company’s facility in France.

Total Operating Expenses

	Three months ended											Six months ended
	Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change			Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change
	(In millions, except percentage and basis point changes)
Total operating expenses	$	11.5		$	9.7		$	1.8		18.7	%	$	23.2		$	18.9		$	4.3		22.9	%
% of sales		23.5	%		23.7	%		—		(20) bps			22.2	%		23.2	%		—		(100) bps

Total operating expenses increased $1.8 million or 18.7% to $11.5 million in the second quarter of 2015 from $9.7 million in the same period of the prior year. Total operating expenses increased $4.3 million or 22.9% to $23.2 million in the first six months of 2015 as compared to $18.9 million in the first six months of 2014. The increase in total operating expenses was due primarily to the reasons discussed above.

As a percentage of sales, total operating expenses decreased to 23.5% in the second quarter of 2015 from 23.7% in the second quarter of 2014. In the first six months of 2015, total operating expenses were 22.2% of sales as compared to 23.2% of sales in the first six months of 2014. The decrease in total operating expenses as a percentage of sales was primarily the result of operating expenses increasing at a slower rate than sales.

Non-operating Income and Expense

	Three months ended							Six months ended
	Mar. 27, 2015		Mar. 28, 2014		$ Change			Mar. 27, 2015		Mar. 28, 2014		$ Change
	(In millions)
Interest, net	$	0.1	$	0.1		—		$	0.2	$	0.1	$	0.1
Foreign exchange, net		0.6		—		0.6			0.9		—		0.9
Other, net		0.1		0.2		(0.1	)		0.2		0.4		(0.2	)
Net non-operating income	$	0.8	$	0.3	$	0.5		$	1.3	$	0.5	$	0.8

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Non-operating income and expense includes interest income, interest expense, net foreign currency exchange gain or loss and other income or expense. Net interest income in the second quarter of 2015 and the second quarter of 2014 was $0.1 million. Net interest income in the first six months of 2015 was $0.2 million as compared to $0.1 million in the first six months of 2014.

Foreign currency exchange gains and losses are related to timing differences in the receipt and payment of funds in various currencies and the conversion of cash, accounts receivable and accounts payable denominated in foreign currencies to the applicable functional currency. In the second quarter of 2015 the company recorded a net foreign currency exchange gain of $0.6 million, as compared to a net loss of $10 thousand in the second quarter of 2014. For the first six months of 2015, foreign currency exchange gains and losses amounted to a net gain of $0.9 million as compared to a net loss of $53 thousand in 2014. The net foreign currency exchange gains recorded in the first three and six month periods of 2015 were driven by the strengthening of the U.S. Dollar against the Euro as the Company has Euro denominated assets and liabilities held in the United States as well as U.S. Dollar denominated assets held in a foreign subsidiary where the functional currency is the Euro.

Net other non-operating income was $0.1 million in the second quarter of 2015 as compared to $0.2 million in the second quarter of 2014. Net other non-operating income was $0.2 million in the first six months of 2015 as compared to $0.4 million in 2014.

Provision for Income Taxes

In the second quarter of 2015 the Company recorded an income tax benefit of $0.1 million on pretax income of $1.5 million, resulting in an effective tax rate benefit of 9.7%. Comparatively, the Company recorded an income tax expense of $0.1 million on pretax income of $0.3 million in the second quarter of 2014, resulting in an effective tax rate of 20.6%. The tax benefit recorded in the second quarter of 2015 was generated by the reduction of previously accrued uncertain foreign taxes partially offset by other foreign and state taxes. The tax provision in the second quarter of 2014 was generated by tax expense in certain foreign jurisdictions and state taxes.

As discussed in Note 7—Income Taxes, the Company evaluates a number of factors in determining whether the weight of available evidence supports the recognition of some or all of the Company’s deferred tax assets, and the need for a valuation allowance. Factors considered when determining the likelihood of realization of the tax assets include, among others, future reversals of existing taxable temporary differences, future taxable income projections, taxable income in carryback years, and tax planning strategies.

The financial results in the United States during the first six months of 2015 were positive and available U.S. NOL’s permitted the Company to not record U.S. income tax expense against those earnings. Although the Company experienced positive U.S. income in the current quarter, the Company’s assessment of all the positive and negative evidence led it to conclude that it is more likely than not that the U.S. deferred tax assets will not be realized, and the valuation allowance against those U.S. tax assets are still necessary. Accordingly, as of March 27, 2015, the Company continued to place a valuation allowance against its U.S. deferred tax assets. There were no material changes to the Company’s Finnish operations and the Company continued to maintain a full valuation allowance against the Finnish deferred tax assets. While a valuation allowance was still in place for financial statement purposes as of March 27, 2015, the valuation allowance does not limit the Company’s ability to utilize the loss-carryforwards or other deferred tax assets on future tax returns. The Company intends to continue maintaining a full valuation allowance on its deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. However, given the Company’s current earnings and anticipated future earnings, the Company believes that there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to allow the Company to reach a conclusion that a significant portion of the valuation allowance on U.S. deferred tax assets will no longer be needed. Release of the valuation allowance would result in the recognition of certain deferred tax assets and a decrease to income tax expense for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change based on the level of profitability that the Company is able to actually achieve.

Net Income

	Three months ended											Six months ended
	Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change			Mar. 27, 2015			Mar. 28, 2014			$ Change		% Change
	(In millions, except percentage and basis point changes)
Net income	$	1.6		$	0.2		$	1.4		607.0	%	$	4.7		$	0.9		$	3.8		447.9	%
% of sales		3.3	%		0.6	%		—		270bps			4.5	%		1.1	%		—		340bps
Net income per share—basic	$	0.07		$	0.01							$	0.21		$	0.04
Net income per share—diluted	$	0.07		$	0.01							$	0.21		$	0.04

20

In the second quarter of 2015 net income was $1.6 million or $0.07 per basic and diluted share, as compared to net income of $0.2 million or $0.01 per basic and diluted share in the second quarter of 2014. In the first six months of 2015, net income was $4.7 million or $0.21 per basic and diluted share, as compared to net income of $0.9 million or $0.04 per basic and diluted share in the first six months of 2014. The increases in net income and net income per share in both periods are due to the reasons discussed above.

Liquidity and Capital Resources

Net cash provided by operating activities was $6.6 million in the first six months of 2015 as compared to net cash provided by operating activities of $1.7 million in the first six months of 2014. Cash provided by operating activities in the first six months of 2015 primarily relates to net income for the period, decreases in accounts receivable and other assets, an increase in accounts payable, and non-cash charges including depreciation and share-based compensation, which did not result in a cash outlay. These sources of cash were partially offset by increases in inventories and decreases in other liabilities and deferred revenue. Comparatively, cash provided by operating activities in the first six months of 2014 primarily related to net income incurred in the period, a decrease in inventories, and non-cash charges including depreciation and share-based compensation, which did not result in a cash outlay. These sources of cash were partially offset by decreases in accounts payable and other liabilities.

Working capital increased $5.0 million to $43.9 million at March 27, 2015 from $38.9 million at September 26, 2014. The increase in working capital was due primarily to increases in cash, inventories, and other current assets, and decreases in other current liabilities, which were partially offset by decreases in accounts receivable and increases in accounts payable. Current assets increased $4.7 million to $76.8 million at March 27, 2015 as compared to $72.1 million at September 26, 2014 due primarily to increases in cash, inventories, and other current assets. Current liabilities decreased $0.3 million to $32.9 million at March 27, 2015 from $33.2 million at September 26, 2014 due primarily to decreases in other current liabilities and the current portion of capital leases partially offset by an increase in accounts payable. Cash increased $3.1 million due primarily to cash provided by operating activities of $6.6 million as a result of the factors discussed above, which was partially offset by cash used in financing activities of $1.8 million and cash used in investing activities of $0.2 million. Inventories increased $4.4 million due primarily to increases in Matrix, desktop monitor, and custom commercial and industrial inventories to support the growth in sales. Other current assets increased $1.1 million due primarily to the reclassification of a portion of the Purchase Price Note Receivable and the Component Device Receivable from Beneq from long-term to current as well as the reclassification of certain French tax receivables from long-term to current. Accounts receivable decreased $4.0 million due primarily to lower sales in the second quarter of 2015 as compared to the fourth quarter of 2014 as well as the timing of collections from customers. Other current liabilities decreased $2.1 million due to a decrease in accrued liabilities. The current portion of capital leases decreased $0.4 million due to principal payments made on the capital lease obligations during the first six months of 2015. Accounts payable increased $2.3 million due to an increase in inventory purchases and also due to the timing of payments to vendors.

The Company’s credit agreement allows for borrowing up to 80% of its eligible accounts receivable with a maximum borrowing capacity of $12.0 million. The credit agreement has interest rates ranging from LIBOR + 2.25% to Prime + 0.75%, expires on November 21, 2015, and is secured by substantially all of the assets of the Company. As of March 27, 2015 the Company’s borrowing capacity was $12.0 million. There were no amounts outstanding under the Company’s credit agreement as of March 27, 2015 and September 26, 2014. The credit agreement contains certain financial covenants, with which the Company was in compliance as of March 27, 2015.

The Company’s position on indefinite reinvestment of unremitted earnings from foreign operations may limit its ability to transfer cash between or across foreign and U.S. operations.

Recently Issued Accounting Pronouncements

In May 2014, the FASB issued Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” (“ASU 2014-09”), which provides guidance on when an entity should recognize revenue in connection with the transfer of goods or services to customers and supersedes the revenue recognition requirements in Topic 605, “Revenue Recognition”. ASU 2014-09 will be effective for public entities for annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method upon adoption of the provisions of this ASU. The Company is currently evaluating which transition method it expects to use and the impacts that adoption of this standard will have on our financial position, results of operations, and cash flows.

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Item 4. Controls and Procedures

An evaluation was carried out under the supervision and with the participation of the Company’s management, including the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), of the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this Report. Based on that evaluation, the CEO and CFO have concluded that the Company’s disclosure controls and procedures are effective. There were no significant changes in the Company’s internal controls or in other factors during the quarter ended March 27, 2015 that could significantly affect the Company’s internal controls over financial reporting.

22

Part II. OTHER INFORMATION

Item 1. Legal Proceedings

There are no material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which the Company is a party or to which any of its property is subject.

Item 1A. Risk Factors

The following issues, risks, and uncertainties, among others, should be considered in evaluating the Company’s future financial performance and prospects for growth.

The Company’s operating results can fluctuate significantly.

In addition to the variability resulting from the short-term nature of commitments from the Company’s customers, other factors can contribute to significant periodic fluctuations in its results of operations. These factors include, but are not limited to, the following:

• the receipt and timing of orders from customers;

• the timing of receipt of components and products from vendors and the timing of delivery of orders, which have recently been and may continue in future periods to be affected by the existing work slowdowns at certain U.S. West Coast ports or other labor unrest at import facilities among other factors;

• the inability to adjust expense levels or delays in adjusting expense levels, in either case in response to lower than expected revenues or gross margins;

• the volume of orders relative to the Company’s capacity;

• product introductions and market acceptance of new products or new generations of products;

• evolution in the lifecycles of customers’ products;

• changes in cost and availability of labor and components;

• variations in revenue and gross margins relating to the mix of products available for sale and the mix of products sold from period to period;

• availability of sufficient quantities of the components of the Company’s products on a timely basis or at all;

• variation in operating expenses;

• expenses arising from the vesting of restricted stock based upon achievement of certain performance measures;

• pricing and availability of competitive products and services;

• general economic conditions and changes—whether or not anticipated—in economic conditions; and

• the ability to use cash flow to fund working capital, capital expenditures, development projects, acquisitions, and other general corporate purposes, which could be limited by any Company indebtedness and the covenants of the Company’s existing credit facility.

Accordingly, the results of any past periods should not be relied upon as an indication of the Company’s future performance. It is possible that, in some future period, the Company’s operating results may be below expectations of public market analysts and/or investors. If this occurs, the Company’s stock price may decrease.

The Company faces intense competition.

Each of the markets served by the Company is highly competitive, and the Company expects this to continue and even intensify. The Company believes that over time this competition will have the effect of reducing average selling prices of its products. Certain of the Company’s competitors have substantially greater name recognition and financial, technical, manufacturing, marketing and other resources than does the Company. There is no assurance that the Company will not face additional competitors or that the Company’s competitors will not succeed in developing or marketing products that would render the Company’s products obsolete or noncompetitive. To the extent the Company is unable to compete effectively, its business, financial condition and results of operations would be materially adversely affected. The Company’s ability to compete successfully depends on a number of factors, both within and outside its control. These factors include, but are not limited to:

• the Company’s ability to anticipate and address the needs of its customers;

23

• the Company’s ability to develop innovative, new and value-added products and technologies and the extent to which such technologies can be protected as proprietary to the Company;

• the quality, performance, reliability, features, ease of use, pricing and diversity of the Company’s product solutions;

• foreign currency fluctuations, which may cause competitors’ products to be priced significantly lower than the Company’s product solutions;

• the quality of the Company’s customer services;

• the effectiveness of the Company’s supply chain management;

• the Company’s ability to identify new markets and develop attractive products to address the needs of such markets;

• the Company’s ability to develop and maintain effective and financially viable sales channels;

• the rate at which customers incorporate the Company’s product solutions into their own products; and

• product or technology introductions by the Company’s competitors.

The Company’s success depends on the development of new products and technologies.

Future results of operations will partly depend on the Company’s ability to improve and successfully market its existing products, while also successfully developing and marketing new value-added products and developing new markets for existing products and technologies. If the Company fails to do this, its products or technologies could become obsolete or noncompetitive. Additionally, if the Company is unable to successfully execute its transition from existing products to new offerings or technologies, it could result in declining sales and the Company holding excess or obsolete inventory, either of which could have a material adverse effect on the Company’s business, financial condition, and results of operations. In the past, the Company has reduced its spending on research and development projects as a part of overall cost reductions. The Company may be required to further reduce research and development expenditures in future periods as a part of cost reduction programs. These reductions could impact the Company’s ability to improve its existing products and to successfully develop new products.

The Company may have challenges with new technologies, products, markets, and customers.

New technologies, products, and markets, by their nature, present significant risks and even if the Company is successful in developing new products, they typically result in pressure on gross margins during the initial phases as start-up activities are spread over lower initial sales volumes. The Company has experienced lower margins from new products and processes in the past, which have negatively impacted overall gross margins. In addition, customer relationships can be negatively impacted due to production and product performance problems and late delivery of shipments. Future operating results will depend on the Company’s ability to continue to provide new product solutions that compare favorably on the basis of cost and performance with competitors. The Company’s success in attracting new customers and developing new business depends on various factors, including, but not limited to, the following:

• developing and/or deploying advances in technology;

• developing innovative products for new markets;

• offering efficient and cost-effective services;

• timely completion of the design and manufacture of new product solutions; and

• developing proprietary technology positions and adequately protecting the Company’s proprietary property.

The Company must continue to add value to its portfolio of offerings.

Traditional display components are produced in such large quantities and by many varied suppliers at a high quality such that traditional display components are subject to increasing competition to the point of commoditization. In addition, advances in LCD technology make standard displays effective in an increasing breadth of applications. An increasing proportion of the Company’s business is based on commercially available components rather than proprietary technology. The Company must add additional value to its products and services for which customers are willing to pay. The Company may not be successful at developing products that add sufficient value beyond commodity products and failure to do so could adversely affect the Company’s revenue levels, margins, and its results of operations and financial condition.

24

The Company’s reliance on third party suppliers for its products creates risks over control of timing, quality and delivery of products.

The Company relies on third party manufacturers or suppliers for substantially all of its products and product components. The Company does not have sufficient market power to exercise significant influence over its suppliers, some of whom are substantially larger than the Company and most of whom are located in Asia. The Company’s reliance on these third parties involves risks, including, but not limited to the following:

• lack of control over production capacity and delivery schedules;

• unanticipated interruptions in transportation and logistics;

• limited control over quality assurance, manufacturing yields and production costs;

• potential termination by suppliers of agreements to supply materials to the Company, which would necessitate the Company’s contracting of alternative suppliers, which may not be possible;

• risks associated with international commerce, including unexpected changes in legal and regulatory requirements, foreign currency fluctuations and changes in duties and tariffs; and

• trade policies and political and economic instability.

The Company’s supply of products and profitability can be adversely affected by each of these risks.

The Company’s dependence on a limited number of key suppliers in foreign countries could result in delayed or more costly products.

The Company obtains much of the material it uses in the manufacture of its products from a limited number of suppliers and in some cases from a single or sole source supplier. It generally does not have long-term supply contracts and the Company does not generally have a guaranteed alternative source of supply. Any one of its suppliers could, among other things:

• encounter constraints in its supply chain, for example due to the unavailability of certain natural resources used in the manufacturing process;

• encounter a natural disaster or other physical act disrupting supply or transportation;

• be unwilling to extend the Company credit to purchase supplies on terms acceptable to the Company;

• be subject to foreign or other local regulations or trade policies applicable to sales of components to the Company;

• choose to prioritize another more significant customer over the Company in periods of high demand;

• discontinue manufacturing the products the Company needs; or

• fail to maintain suitable manufacturing facilities, train manufacturing employees, manage its supply chain effectively, manufacture a quality product, or provide spare parts in support of the Company’s warranty and customer service obligations.

Examples of these risks include, without limitation:

• Asia experiencing several earthquakes, tsunamis, typhoons, and interruptions to power supplies, resulting in business interruptions. In particular, the March 2011 earthquake and tsunami in Japan caused some of the Company’s suppliers and some of the vendors of the Company’s suppliers to halt, delay or reduce production of displays, display components and other materials used in the Company’s products;

• in fiscal 2010, in connection with an intellectual property dispute among two LCD panel manufacturers, the U.S. International Trade Commission issued an exclusion order banning the import of certain LCD panels incorporated by the Company into certain of its specialty display products (this matter was resolved); and

• certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act requiring reports on “conflict minerals,” possibly resulting in increased costs or constrained supply as contract manufacturers attempt to assess and possibly avoid the purchase of conflict minerals from the Democratic Republic of the Congo and adjoining countries.

Any of these risks could result in, among other things, the Company having:

• the inability to timely obtain sufficient quantities of components and other materials necessary to produce the Company’s displays and products to meet customer demand, resulting in reduced, delayed or cancelled sales and the loss of customers;

• an increase in the costs for supplies and components, resulting in decreased margins and profits;

25

• excess or obsolete inventory, because of a failure to timely obtain all of the components for a product, resulting in write-offs and additional expenditures; and

• poor quality components, resulting in increased costs for replacements and returns, cancellation of orders and loss of customers.

Any significant interruption in the supply of displays, components and contract manufacturing capacity necessary to produce and sell the Company’s products would have a material adverse effect on the Company’s business, financial condition and results of operations.

Continued customer demands to shorten delivery times along with supplier constraints in meeting lead time schedules could result in the Company not meeting customer demands and excess or obsolete inventory.

The Company is subject to supply lead times that can vary considerably depending on capacity fluctuations and other manufacturing constraints of the Company’s suppliers. These lead times can be significant when suppliers operate with diminished capacity or experience other restrictions that limit their ability to produce products in a timely manner. For most of the Company’s products, supplier lead times significantly exceed the Company’s customers’ required delivery time, causing the Company to order based on a forecast rather than order based on actual demand. Competition for the Company’s products continues to reduce the period of time customers will wait for product delivery. Ordering raw materials and building finished goods based on the Company’s forecast rather than actual demand exposes the Company to numerous risks including its inability to service customer demand in an acceptable timeframe, holding excess and obsolete inventory or having unabsorbed manufacturing overhead.

The risks inherent in the Company’s operations could be heightened by general economic weakness and potential lack of credit availability.

In recent years, disruptions in global credit and financial markets and the general decline in worldwide economic conditions have resulted in diminished liquidity and credit availability, a decline in consumer confidence, increased unemployment, a decline in economic growth and uncertainty about economic stability. These types of conditions make it extremely difficult for the Company and its customers and vendors to accurately forecast and plan future business activities. In times of economic uncertainties, the Company’s financial performance and prospects for growth are subject to heightened risks including, but not limited to, the risk that the poor economic conditions and uncertainties in the credit and financial markets could adversely affect the amount, timing and stability of the demand for the Company’s products, the financial strength of the Company’s customers and vendors and their ability or willingness to do business with the Company, the ability of the Company’s customers and/or vendors to fulfill their obligations to the Company, and the ability of the Company’s customers and/or vendors to obtain credit in amounts and on terms acceptable to them. Each of the foregoing could have a material adverse effect on the Company’s business, financial condition and results of operations.

The Company took a number of measures to reduce costs in response to the worldwide economic downturn over the past several years. However, in connection with the execution of the growth strategy adopted during fiscal 2011 the Company has refocused sales and marketing resources to better position it for sales growth. If the economic recovery were to slow or cease and dip back into recession, or if customer demand for the Company’s products were to otherwise not improve or slow down, the Company might be unable to adjust expense levels rapidly enough in response to falling demand or adequately reduce expenses without changing the way in which it operates in a manner that adversely affects its business, financial condition, or results of operations. If revenues were to decrease and the Company was unable to adequately reduce expense levels, it might incur significant losses that could potentially adversely affect the Company’s overall financial performance and the market price of the Company’s common stock.

A significant slowdown in the demand for the products of certain of the Company’s customers would adversely affect its business.

The Company designs and manufactures custom display solutions that its customers incorporate into their products. As a result, the Company’s success partly depends upon the market acceptance of its customers’ products. Dependence on the success of products of the Company’s customers exposes the Company to a variety of risks, including, but not limited to, the following:

• the Company’s ability to match its design and manufacturing capacity with customer demand and to maintain satisfactory delivery schedules;

• customer order patterns, changes in order mix and the level and timing of orders that the Company can manufacture and ship in a quarter; and

• the cyclical nature of the industries and markets served by the Company’s customers.

These risks could have a material adverse effect on the Company’s business, financial condition and results of operations.

26

The Company faces risks associated with operations outside the United States.

The Company’s manufacturing, sales and distribution operations in Europe and Asia create a number of logistical, systems and communications challenges. The Company’s international operations also expose the Company to various economic, political and other risks, including, but not limited to, the following:

• complexities involved in the management of a multi-national organization;

• compliance with local laws and regulatory requirements as well as changes in those laws and requirements;

• employment and severance issues;

• complexity of tax issues;

• tariffs and duties;

• employee turnover or labor unrest;

• lack of developed infrastructure;

• difficulties protecting intellectual property;

• difficulties repatriating funds without adverse tax effects;

• risks associated with outbreaks of infectious diseases;

• burdens and costs of compliance with a variety of foreign laws;

• political or economic instability throughout the world;

• effects of doing business in currencies other than the Company’s functional currency;

• effects of doing business in countries where the local currency is pegged to the currency of another country (For instance the exchange rate of the Chinese RMB to the U.S. Dollar is closely monitored by the Chinese government and may be subject to significant changes in future periods. The Company purchases a significant amount of goods from Chinese suppliers and, while those purchases are typically denominated in U.S. Dollars, changes in the RMB relative to the U.S. Dollar would tend to cause the cost of such goods to fluctuate); and

• effects of foreign currency fluctuations on overall financial results. (For instance, while the Company is for the most part naturally hedged due to approximately equal foreign denominated sales and expenses, the Company is exposed to certain risks relating to Euro denominated assets held in the United States as well as U.S. Dollar denominated assets primarily held in Europe. The Company does not hedge foreign currency risk through forward exchange contracts. As a result the Company may experience non-cash GAAP income statement losses due to changes in the U.S. Dollar versus the Euro exchange rate.)

Changes in policies by the United States or foreign governments resulting in, among other things, increased duties, higher taxation, currency conversion limitations, restrictions on the transfer or repatriation of funds, limitations on imports or exports, changes in environmental standards or regulations, or the expropriation of private enterprises also could have a materially adverse effect on the Company’s business, financial condition, and results of operations. Any actions by the Company’s host countries to curtail or reverse policies that encourage foreign investment or foreign trade also could adversely affect its operating results. In addition, U.S. trade policies, such as “most favored nation” status and trade preferences for certain Asian nations, could affect the attractiveness of the Company’s services to its U.S. customers.

The sale of the Company’s EL display assets and liabilities involves significant risks.

In November 2012, the Company completed a transaction in which Beneq Products Oy (“Beneq Products”) purchased from the Company substantially all of the assets, and assumed certain liabilities, used in or necessary in connection with the Company’s EL display business (the “EL Transaction”). As a result of or in connection with the EL Transaction, the Company may incur future liabilities, costs, expenses, claims, and losses, including those relating to (i) claims by Beneq Products for losses incurred by Beneq Products as a result of breaches of representations and warranties given by the Company in the sale agreement, (ii) claims against the Company by third parties associated with the EL display business (e.g. vendors, customers, etc.) based upon, or payments made or further credit granted by the Company in respect of, non-performance by Beneq Products of obligations it assumed in the EL transaction, (iii) liabilities relating to the EL display business that the Company retained as part of the EL Transaction, and (iv) a default by Beneq Products on the promissory notes issued to the Company by Beneq Products in connection with the EL Transaction and related transactions (collectively, the “Promissory Notes”) or the agreement among the Company, Beneq Products and Beneq Oy, the parent company of Beneq Products (“Beneq Oy” and collectively with Beneq Products, “Beneq”), entered into in June 2014 to repay to the Company funds advanced for certain electronic component devices as discussed below (the “Settlement Agreement”).

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Any liabilities, costs or expenses incurred by the Company as a result of the foregoing or other matters arising out of or in connection with the EL Transaction could materially and adversely affect the Company’s business, financial condition and results of operations.

As discussed in Note 9—Beneq Receivables to the Consolidated Financial Statements, in April 2014 the Company entered into an agreement with a vendor related to a purchase commitment that was transferred by the Company to Beneq Products in connection with the EL Transaction. As a part of the April 2014 agreement, the Company agreed to take delivery and ownership of €2.9 million of electronic component devices. The Company subsequently entered into the Settlement Agreement with Beneq to establish the terms under which the component devices will be transferred to and paid for by Beneq.

As discussed in Note 9—Beneq Receivables to the Consolidated Financial Statements, on October 23, 2014, Beneq Products informed the Company that it would not pay, when due on November 30, 2014, the first principal payment of $650,000 under the Promissory Notes. Beneq Products sought to exercise its right under the Promissory Notes to reschedule, on a single occasion, the due date of a payment to a date not later than 180 days after the November 30, 2014 due date and requested that the Company agree to waive the penalty interest payable under the Promissory Notes in connection with the exercise of its right to delay payment. Under the terms of the Promissory Notes, Beneq Products had agreed that, upon its exercise of the right to delay payment, it would pay a penalty equal to 12 months interest on the entire loan balance. The Company has agreed to allow Beneq to exercise its right to delay repayment of the initial principal payment for up to 180 days in consideration for the payment of penalty interest equal to an additional 2% on the deferred balance in lieu of the penalty amount set forth in the Promissory Notes. The Company believes that Beneq’s request to delay repayment of the principal scheduled to be paid on November 30, 2014 evidences an increased risk that Beneq will be unable to repay its obligations to the Company in the normal course of operating its business. Given Beneq Oy’s guarantee of the obligations of Beneq Products under the Promissory Notes, the Company’s security interest in assets of each of Beneq Products and Beneq Oy and information provided by Beneq relating to its efforts to take actions that would enhance its ability to perform the obligations under the Promissory Notes and the Settlement Agreement, the Company continues to believe there is a reasonable probability that Beneq will satisfy its obligations to the Company. However, no assurance can be given that the on-going operations of Beneq will support the repayment of these obligations, that Beneq will otherwise be able to complete actions necessary to ensure repayment of these obligations, or that the value of the assets of Beneq Oy and Beneq Products will be sufficient to repay, in full or in a timely manner, the obligations owed to the Company. The Company will continue to monitor the events, facts and circumstances associated with the Beneq obligations and evaluate the impact of any changes in facts and circumstances on the value of the Beneq obligations. The failure by Beneq to perform its obligations under the Promissory Notes or the Settlement Agreement, or a decision by the Company, based upon future events, facts or circumstances, to write down the value of these assets on the Company’s books, could materially and adversely affect the Company’s assets and results of operations.

Variability of customer requirements or losses of key customers may adversely affect the Company’s operating results.

The Company must provide increasingly rapid product turnaround and respond to ever-shorter lead times expected from its customers and ever-longer lead times from its vendors and suppliers, while at the same time meeting its customers’ product specifications and quality expectations. A variety of conditions, including bankruptcy and other conditions both specific to individual customers and generally affecting the demand for their products, may cause customers to cancel, reduce, or delay orders. These actions by a significant customer or by a set of customers could adversely affect the Company’s business. On occasion, customers require rapid increases in production, which can strain the Company’s resources and reduce margins. The Company may lack sufficient capacity or inventory at any given time to meet customers’ demands. Sales to a significant customer, if lost, could have a material, adverse impact on the results of operations. If accounts receivable from a significant customer or set of customers became uncollectible, a resulting charge could have a material adverse effect on operations.

The Company may be unable to attract and retain key personnel.

The Company’s success depends in part upon the services of its executive officers and key personnel. The loss of key personnel, or the Company’s inability to attract and retain qualified personnel, could inhibit the Company’s ability to operate and grow its business and otherwise have a material adverse effect on its business, financial position and results of operations. The Company has previously had to, and may in the future have to, impose salary freezes and reductions in force in an effort to maintain its financial position. These actions may have an adverse effect on employee loyalty and may make it more difficult for the Company to attract and retain key personnel. Competition for qualified personnel in the businesses in which the Company competes is intense, and the Company may not be successful in attracting and retaining qualified personnel. The Company may incur significant costs in its efforts to recruit and retain key personnel, which could have a material adverse effect on its business, financial condition and results of operations.

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Future indebtedness could reduce the Company’s ability to use cash flow for purposes other than debt service or otherwise restrict the Company’s activities.

If the Company incurred a significant amount of debt under its current secured credit facility or otherwise, the leverage would reduce the Company’s ability to use cash flow to fund working capital, capital expenditures, development projects, acquisitions, and other general corporate purposes. High leverage would also limit flexibility in planning for, or reacting to, changes in business and increases vulnerability to a downturn in the business and general adverse economic and industry conditions. Substantially all of the assets of the Company are pledged as security for the performance of the Company’s obligations under its credit agreement, which includes certain financial covenants. The Company may not generate sufficient profitability to meet these covenants. If the Company fails to comply with applicable covenants under its debt agreements, the Company may be unable to borrow amounts under the agreements or may have to repay all amounts outstanding at that time, which, in turn could lead to the Company’s inability to pay its debts and the loss of control of its assets. If the Company is unable to borrow amounts under the agreements or is unable to extend or renew the agreements upon expiration, the Company may need to pursue other sources of financing. Other sources of credit may not be available at all or on terms that are acceptable to the Company. If credit is not available to fully satisfy the Company’s liquidity needs, the Company may need to dispose of additional assets. In addition, the Company’s position on indefinite reinvestment of unremitted earnings from foreign operations may limit its ability to transfer cash between or across foreign and U.S. operations as may be required to service its debt.

The Company may experience losses selling certain desktop monitors or other low margin products.

The market for the Company’s desktop monitor and other low margin products is highly competitive and subject to rapid changes in prices and demand. The Company’s failure to successfully manage inventory levels or quickly respond to changes in pricing, technology or consumer tastes and demand could result in lower than expected revenue, lower gross margin and excess, obsolete and devalued inventories of its desktop monitor or other low margin products which could adversely affect the Company’s business, financial condition and results of operations. Past market conditions have been characterized by rapid declines in end user pricing. Such declines caused the Company’s inventory to lose value and triggered price protection obligations for channel inventory. Supply and pricing of LCD panels has been volatile in the past and may be in the future. This volatility, combined with lead times of five to eight weeks, may cause the Company to pay too much for products or suffer inadequate product supply.

The Company does not have long-term agreements with its resellers, who generally may terminate their relationship with the Company with little or no notice. Such action by the Company’s resellers could substantially harm the Company’s operating results. In addition, strategic changes made by the Company’s management to invest greater resources in specialty display markets could result in reduced revenue from desktop monitors.

The sale, disposal or elimination of one or more business or product lines could result in unabsorbed overhead costs that must be absorbed by the Company’s remaining product lines.

From time to time the Company disposes of product lines. For instance, in the first fiscal quarter of 2013 the Company sold the assets and liabilities related to the EL product line. The Company may consider selling, disposing or discontinuing business or product lines or reducing its staffing and efforts to sell particular product lines. If the Company were to sell, dispose of or discontinue one or more business or product lines or substantially reduce its efforts to sell products to any of its targeted end-markets, for the purpose of reducing costs or losses or changing strategic direction or otherwise, the Company might not be able to eliminate all, or even a substantial portion of, fixed overhead costs, including those associated with those products. Not reducing or eliminating overhead costs in these circumstances could cause a decrease in the Company’s gross profit margins for its remaining products or result in losses.

The Company may encounter difficulties in the operation of its new enterprise resource planning (“ERP”) system.

The operation of the new ERP system, which commenced in the third quarter of 2013, is a complex process that is subject to a variety of difficulties and uncertainties. Any difficulties the Company encounters with the successful operation of the new ERP system, or modification of the system to meet changing business needs, could damage the effectiveness of the Company’s business processes and controls and could adversely impact the Company’s ability to accurately and effectively forecast and manage sales demand, manage the Company’s supply chain, identify and implement actions that improve the Company’s operational effectiveness, and report financial and management information on an accurate and timely basis, any of which could have a material adverse effect on the Company’s business, financial condition and results of operations.

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The Company may lose key licensors, sales representatives, foundries, licensees, vendors, other business partners and employees due to uncertainties regarding the future results of the Company or the worldwide economic condition, which could seriously harm the Company.

Sales representatives, vendors, resellers, distributors, and others doing business with the Company may experience uncertainty about their future role with the Company, may elect not to continue doing business with the Company, may seek to modify the terms under which they do business in ways that are less attractive, more costly, or otherwise damaging to the business of the Company, or may declare bankruptcy or otherwise cease operations. Loss of relationships with these business partners could adversely affect the Company’s business, financial condition, and results of operations. Similarly, the Company’s employees may experience uncertainty about their future role with the Company to the extent that its operations are unsuccessful or its strategies are changed significantly. This may adversely affect its ability to attract and retain key management, marketing and technical personnel. The loss of a significant group of key technical personnel would seriously harm the Company’s product development efforts. The loss of key sales personnel could cause the Company to lose relationships with existing customers, which could cause a decline in the sales of the Company’s products.

The Company does not have long-term purchase commitments from its customers.

The Company’s business is generally characterized by short-term purchase orders and contracts that specify certain sales terms but do not require customers to make purchases. The Company typically plans its production and inventory levels based on internal forecasts of customer demand which rely in part on nonbinding forecasts provided by its customers and estimated lead times provided by its vendors and suppliers. As a result, the Company’s backlog generally does not exceed three months, which makes forecasting its sales difficult. Inaccuracies in the Company’s forecast as a result of changes in customer demand or otherwise may result in its inability to service customer demand in an acceptable timeframe, the Company holding excess and obsolete inventory, or having unabsorbed manufacturing overhead. The failure to obtain anticipated orders and deferrals or cancellations of purchase commitments because of changes in customer requirements, or otherwise, could have a material adverse effect on the Company’s business, financial condition and results of operations. The Company has experienced such problems in the past and may experience such problems in the future.

The Company must protect its intellectual property, and others could infringe on or misappropriate its rights.

The Company believes that its business success depends, in part, on developing proprietary technology and protecting its proprietary technology. The Company relies on a combination of patent, trade secret, and trademark laws, confidentiality procedures and contractual provisions to protect its intellectual property. The Company seeks to protect some of its technology under trade secret laws, which afford only limited protection. The Company faces risks associated with its intellectual property, including, but not limited to, the following:

• much of the Company’s proprietary intellectual property is not protectable by patent, copyright or similar laws;

• patent and copyright applications are filed only in a limited number of countries;

• pending patent and copyright applications may not be issued or may be significantly limited in scope prior to issuance;

• intellectual property laws may not protect the Company’s intellectual property rights;

• others may challenge, invalidate, or circumvent any patent or copyright issued to the Company;

• rights granted under patents or copyrights issued to the Company may not provide competitive advantages to the Company;

• unauthorized parties may attempt to obtain and use information that the Company regards as proprietary despite its efforts to protect its proprietary rights; and

• others may independently develop similar technology or design around any patents issued to the Company.

The Company has to defend against infringement claims.

In recent fiscal years, the Company has been made party to lawsuits (among many other defendants) alleging infringement of certain U.S. patents relating to certain products marketed and sold by the Company, including the Company’s Indisys image processing products, certain projector products, and LED technology. While each of these matters has been resolved, the Company is currently a party to patent infringement litigation in cases relating to the Company’s sale of multi-monitor stands and certain home theater projector products. Intellectual property litigation can be very expensive and can divert management’s time and attention, which could adversely affect the Company’s business. In addition, the Company may not be able to obtain a favorable outcome in any intellectual property litigation.

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In the event of an allegation that the Company is infringing on another’s rights, the Company may seek to obtain a license to the intellectual property at issue or refuse the claim. The Company may not be able to obtain licenses on commercially reasonable terms, if at all, and the party alleging infringement may commence litigation against the Company. The failure to obtain necessary licenses or other rights or the institution of litigation arising out of such claims could materially and adversely affect the Company’s business, financial condition and results of operations. The Company will vigorously defend itself against the assertion of any future claims for infringement and will, as a matter of course, seek indemnification from third-party suppliers, where available. While the Company would, in each instance, seek indemnification from the manufacturer of an accused product if it were found to be liable, a determination of liability against the Company could have an adverse impact on the Company’s business, financial condition, and results of operations.

The market price of the Company’s common stock may be volatile.

The market price of the Company’s common stock has been subject to wide fluctuations. During the Company’s four most recently completed fiscal quarters, the sales prices of the Company’s stock ranged from $1.93 to $9.17. The market price of the Company’s common stock in the future is likely to continue to be subject to wide fluctuations in response to various factors, including, but not limited to, the following:

• variations in the Company’s operating results and financial condition;

• variations in trading volumes of the Company’s stock;

• public announcements by the Company as to its expectations of future sales and net income or loss;

• actual or anticipated announcements of technical innovations or new product developments by the Company or its competitors;

• changes in analysts’ estimates of the Company’s financial performance;

• general conditions in the electronics industry; and

• worldwide economic and financial conditions.

In addition, the public stock markets have experienced extreme price and volume fluctuations that have particularly affected the market prices for many technology companies and that often have been unrelated to the operating performance of these companies. These broad market fluctuations and other factors may continue to adversely affect the market price of the Company’s common stock.

The Company faces risks in connection with potential acquisitions.

The Company has made several acquisitions during its history. Not all of these acquisitions have been successful. It is possible that the Company will make additional acquisitions in the future. The Company’s ability to effectively integrate any future acquisitions will depend on, among other things, the adequacy of its implementation plans, the ability of management to oversee and effectively operate the combined operations and the Company’s ability to achieve desired operational efficiencies. The integration of businesses, personnel, product lines and technologies is often difficult, time consuming and subject to significant risks. For example, the Company could lose key personnel from companies that it acquires, incur unanticipated costs, lose major sources of revenue, fail to integrate critical technologies, suffer business disruptions, fail to capture anticipated synergies, or fail to establish satisfactory internal controls. Any of these difficulties could disrupt the Company’s ongoing business, distract management and employees, increase expenses and decrease revenues. Furthermore, the Company might assume or incur debt or issue additional equity securities to pay for future acquisitions. Additional debt may negatively impact the Company’s financial results and increase its financial risk, and the issuance of any additional equity securities could dilute the Company’s then existing shareholders’ ownership. In addition, in connection with any future acquisitions, the Company could:

• incur amortization expense related to intangible assets;

• uncover previously unknown liabilities; or

• incur large and immediate write-offs that would reduce net income.

Acquisitions are inherently risky, and any acquisition may not be successful. If the Company is unable to successfully integrate the operations of any businesses that it may acquire in the future, the Company’s business, financial position, results of operations or cash flows could be materially adversely affected.

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Changes in internal controls or accounting guidance could materially adversely affect the Company’s financial results and/or cause volatility in the Company’s stock price.

Failure of the Company’s internal controls to prevent error or fraud could adversely affect the Company’s financial position and results of operations. The Company’s internal controls over financial reporting have not been required to be audited by its independent registered public accounting firm in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) since 2008. Beginning with the fiscal year ended September 25, 2015, the Company’s internal controls over financial reporting will be required to be audited by its independent registered public accounting firm. As a result, significant additional expenditures could be incurred which could adversely impact the Company’s results of operations.

Additionally, the Company’s future assessment of its internal controls over financial reporting, or a future audit by the Company’s independent public accounting firm on the effectiveness of internal controls over financial reporting, could identify a material weakness which would result in the Company receiving an adverse opinion on its internal controls over financial reporting from its independent registered public accounting firm. The identification of a material weakness could result in additional expenditures responding to the Section 404 internal control audit, heightened regulatory scrutiny, and if not remediated could result in future errors in the Company’s financial statements all of which could potentially have an adverse effect on the price of the Company’s stock.

The Company cannot provide any assurance that current environmental laws and product quality specification standards, or any laws or standards enacted in the future, will not have a material adverse effect on its business.

The Company’s operations are subject to environmental and various other regulations in each of the jurisdictions in which it conducts business. Some of the Company’s products use substances, such as lead, that are highly regulated or will not be allowed in certain jurisdictions in the future. The Company has redesigned certain products to eliminate such substances in its products. In addition, regulations have been enacted in certain jurisdictions which impose restrictions on waste disposal of electronic products and electronics recycling obligations. If the Company fails to comply with applicable rules and regulations in connection with the use and disposal of such substances or other environmental or recycling legislation, it could be subject to significant liability or loss of future sales.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table sets forth information regarding purchases of our shares of common stock during the three-month period ended March 27, 2015:

Period	(a) Total number of shares purchased(1)		(b) Average price paid per share(1)		(c) Total number of shares purchased as part of publicly announced plans or programs		(d) Approximate dollar value of shares that may yet be purchased under the plans or programs
Month 1
December 27, 2014 to January 30, 2015		2,726	$	8.37		—	$	—
Month 2
January 31, 2015 to February 27, 2015		10,841	$	6.26		—	$	—
Month 3
February 28, 2015 to March 27, 2015		—	$	—		—	$	—
Total		13,567	$	6.68		—

(1) Fully vested shares of common stock withheld by us in satisfaction of required withholding tax liability upon the vesting of restricted shares.

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Item 6. Exhibits

(a)

10.1	Planar Systems, Inc. 2015 Incentive Plan* (1)
10.2	Planar Systems, Inc. 2015 Employee Stock Purchase Plan* (1)
10.3	Second Amended and Restated Executive Employment Agreement, entered into as of March 2, 2015, between Planar Systems, Inc. and Gerald Perkel* (2)
10.4	Second Amended and Restated Executive Severance Agreement, entered into as of March 2, 2015, between Planar Systems, Inc. and Stephen M. Going* (2)
10.5	Second Amended and Restated Key Employee Severance Agreement, entered into as of March 2, 2015, between Planar Systems, Inc. and Ryan W. Gray* (2)
31.1	Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

1 Incorporated by reference to the Company’s Proxy Statement filed January 9, 2015.

2 Incorporated by reference to the Company’s Current Report on Form 8-K filed March 4, 2015.

* This exhibit constitutes a management contract or compensatory plan or arrangement.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	PLANAR SYSTEMS, INC. (Registrant)
DATE: May 8, 2015	/S/    RYAN GRAY
	Ryan Gray
	Vice President and Chief Financial Officer

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