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<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 1 - us-gaap:SignificantAccountingPoliciesTextBlock-->
<!-- xbrl,ns -->
<!-- xbrl,nx -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt"><b></b>
</div>
<div align="left">
</div>
<div align="center" style="font-size: 10pt"><b></b></div>
<div align="center" style="font-size: 10pt"><b></b></div>
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 1: Basis of Presentation</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The unaudited condensed consolidated financial statements included herein have been prepared by
Electro Rent Corporation, pursuant to the rules and regulations of the United States Securities and
Exchange Commission (the “SEC”). The condensed consolidated financial statements include the
accounts of Electro Rent Corporation and its wholly owned subsidiaries, Genstar Rental Electronics,
Inc., Electro Rent, LLC, ER International, Inc., Electro Rent Europe NV, Electro Rent Asia, Inc.,
Electro Rent (Beijing) Test and Measurement Equipment Rental Co., Ltd., and Electro Rent (Tianjin)
Rental Co., Ltd. (collectively “we”, “us”, or “our”) as consolidated with the elimination of all
intercompany transactions.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Certain information and footnote disclosures normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States of America (“GAAP”)
have been condensed or omitted pursuant to such SEC rules and regulations. These condensed
consolidated financial statements reflect all adjustments and disclosures that are, in our opinion,
necessary for a fair presentation of our financial position and results of operations for the
interim periods presented. These condensed consolidated financial statements should be read in
conjunction with the audited financial statements and notes thereto included in our latest Annual
Report on Form 10-K filed with the SEC on August 8, 2011.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The preparation of financial statements in conformity with GAAP requires us to make estimates and
assumptions that affect the reported amounts of assets and liabilities as well as the disclosures
of contingent assets and liabilities as of the date of these financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual results could differ from
those estimates, and results of operations for interim periods are not necessarily indicative of
results for the full year.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Foreign Currency</u>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The U.S. dollar has been determined to be our functional currency. The assets and liabilities of
our foreign subsidiaries are remeasured from their functional currency to U.S. dollars at current
or historic exchange rates, as appropriate. Revenues and expenses are remeasured from any foreign
currencies to U.S. dollars using historic rates or an average monthly rate, as appropriate, for the
month in which the transaction occurred. Remeasurement gains and losses are included in selling,
general and administrative expenses or income taxes, as appropriate. The assets, liabilities,
revenues and expenses of our foreign subsidiaries are individually less than 10% of our respective
consolidated amounts. The euro, Canadian dollar and Chinese yuan are our primary foreign
currencies.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We enter into forward contracts to hedge against unfavorable fluctuations in our monetary assets
and liabilities in our European and Canadian operations. These contracts are designed to minimize
the effect of fluctuations in foreign currencies. Such derivative instruments are not designated
as hedging instruments and, therefore, are recorded at fair value as a current asset or liability,
and any changes in fair value are recorded in our condensed consolidated statements of operations.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The fair value of our foreign exchange forward contracts in the consolidated balance sheets is
shown in the table below:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="64%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Consolidated</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left">Derivatives Not Designated as</td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Balance Sheet</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">August 31,</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">May 31,</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000">Hedging Instruments</td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Location</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2011</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2011</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Foreign exchange forward contracts
</div></td>
<td> </td>
<td colspan="3" align="center">Other assets</td>
<td> </td>
<td align="left">$</td>
<td align="right">78</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">15</td>
<td> </td>
</tr>
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px">
</div>
</td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
<td></td>
</tr>
<!-- End Table Body -->
</table>
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The table below provides data about the amount of losses recognized in income for derivative
instruments not designated as hedging instruments:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="30%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="30%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Three Months</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Three Months</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="left" colspan="2">Location of Loss</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Ended</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Ended</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left">Derivatives Not Designated as</td>
<td> </td>
<td nowrap="nowrap" align="left" colspan="2">Recognized in</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">August 31,</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">August 31,</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000">Hedging Instruments</td>
<td> </td>
<td nowrap="nowrap" align="left" colspan="2" style="border-bottom: 1px solid #000000">Income on Derivatives</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2011</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2010</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Foreign exchange forward contracts
</div></td>
<td> </td>
<td colspan="3" align="left">Selling, general and administrative expenses</td>
<td> </td>
<td align="left">$</td>
<td align="right">6</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">138</td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Other Assets</u>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We include demonstration equipment used in connection with our resale activity of $4,520 and $3,894
as of August 31, 2011 and May 31, 2011, respectively, in other assets for a period of up to two
years. Demonstration equipment is recorded at the lower of cost or estimated market value until
the units are sold or transferred to our rental and lease equipment pool. Demonstration equipment
transferred to our rental and lease equipment pool is depreciated over its remaining estimated
useful life.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Other assets consisted of the following:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="76%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">August 31,</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">May 31,</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">2011</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">2011</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr style="font-size: 0px">
<td colspan="9" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Net investment in sales-type leases
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">7,907</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">7,478</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Demonstration equipment
</div></td>
<td> </td>
<td> </td>
<td align="right">4,520</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">3,894</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Supplemental executive retirement plan assets
</div></td>
<td> </td>
<td> </td>
<td align="right">2,481</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">2,671</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Income taxes receivable
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">3,066</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Prepaid expenses and other
</div></td>
<td> </td>
<td> </td>
<td align="right">2,803</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">2,679</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td colspan="9" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">17,711</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">19,788</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td colspan="9" align="left" style="border-top: 3px double #000000"> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Recent Accounting Pronouncements</u>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">In December 2010, the FASB issued an update to its existing guidance for goodwill and other
intangible assets. This guidance modifies testing for reporting units with zero or negative
carrying amounts. For those reporting units, in addition to evaluating whether the carrying amount
of a reporting unit exceeds fair value, an entity must assess whether it is more likely than not
that a goodwill impairment exists. To make that determination, an entity must consider whether
there are any adverse qualitative factors indicating potential impairment. The amendments in this
update are effective for fiscal years, and interim periods within those years, beginning after
December 15, 2010. Early adoption is not permitted. We do not anticipate that the adoption of this
guidance will have a material impact on our financial condition, results of operations or cash
flows.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">In May 2011, the FASB issued guidance to provide a consistent definition of fair value and ensure
that the fair value measurement and disclosure requirements are similar between U.S. generally
accepted accounting principles and International Financial Reporting Standards. The guidance also
changes certain fair value measurement principles and enhances the disclosure requirements
particularly for Level 3 fair value measurements. This guidance is effective for reporting periods
beginning on or after December 15, 2011, with early adoption prohibited. We will be required to
adopt this guidance beginning with our fourth quarter of fiscal 2012. We do not anticipate that
the adoption of this guidance will have a material impact on our financial condition, results of
operations or cash flows.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">In June 2011, the FASB issued guidance on presentation of comprehensive income. The new guidance
eliminates the current option to report other comprehensive income and its components in the
statement of changes in equity. Instead, an entity will be required to present either a continuous
statement of net income and other comprehensive income or in two separate but consecutive
statements. This guidance is effective for fiscal years, and interim periods within those years,
beginning after December 15, 2011. Early adoption of the new guidance is permitted and full
retrospective application is required. We will be required to adopt this guidance beginning with
our first quarter of fiscal 2013. We do not anticipate that the adoption of this guidance will
have a material impact on our financial condition, results of operations or cash flows.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Reclassifications</u>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Certain prior year amounts have been reclassified to conform to the current year presentation.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 2 - us-gaap:CashAndCashEquivalentsDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 2: Cash and Cash Equivalents</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We consider highly liquid investments with maturities of three months or less at the date of
purchase to be cash equivalents. Cash equivalents consisted primarily of AAA-rated money market
funds in all periods presented.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 3 - us-gaap:FairValueDisclosuresTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 3: Fair Value Measurements</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We measure certain financial assets and liabilities at fair value on a recurring basis, including
cash equivalents, supplemental executive retirement plan assets and liabilities, and foreign
currency derivatives. The fair value of these financial assets and liabilities was determined
based on three levels of inputs, of which the first two are considered observable and the last
unobservable, that may be used to measure fair value, as follows:
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 2%">Level 1 — Observable inputs, such as quoted prices in active markets for identical assets
or liabilities;
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 2%">Level 2 — Inputs, other than the quoted prices in active markets, that are observable
either directly or through corroboration with observable market data; and
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 2%">Level 3 — Unobservable inputs, for which there is little or no market data for the assets
or liabilities, such as internally-developed valuation models.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Assets and liabilities measured at fair value on a recurring basis were as follows:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="52%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000">At August 31, 2011</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Quoted Prices</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">in Active</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Significant</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Markets for</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Other</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Significant</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Identical</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Observable</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Unobservable</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Instruments</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Inputs</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Inputs</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Total</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">(Level 1)</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">(Level 2)</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">(Level 3)</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Balance</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Assets
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Money market funds
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">16,319</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">16,319</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Supplemental executive retirement
plan
</div></td>
<td> </td>
<td> </td>
<td align="right">2,481</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">2,481</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Foreign exchange forward contracts
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">78</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">78</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Total assets measured at fair value
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">18,800</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">78</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">18,878</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Liabilities
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Supplemental executive retirement
plan
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">2,481</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2,481</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Total liabilities measured at fair
value
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">2,481</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2,481</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="52%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000">At May 31, 2011</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Quoted Prices</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">in Active</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Significant</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Markets for</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Other</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Significant</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Identical</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Observable</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Unobservable</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Instruments</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Inputs</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Inputs</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Total</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">(Level 1)</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">(Level 2)</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">(Level 3)</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Balance</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Assets
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Money market funds
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">32,868</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">32,868</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Supplemental executive retirement
plan
</div></td>
<td> </td>
<td> </td>
<td align="right">2,671</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">2,671</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Foreign exchange forward contracts
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">15</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">15</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Total assets measured at fair value
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">35,539</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">15</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">35,554</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Liabilities
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Supplemental executive retirement
plan
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">2,671</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2,671</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Total liabilities measured at fair
value
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">2,671</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2,671</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The fair value measures for our money market funds and supplemental executive retirement plan asset
and liability were derived from quoted market prices in active markets and are included in Level 1
inputs. Foreign currency forward contracts were valued based on observable market spot and forward
rates as of our reporting date and are included in Level 2 inputs.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The following table presents a reconciliation of all assets and liabilities measured at fair value
on a recurring basis, excluding accrued interest components, using significant unobservable inputs
(Level 3):
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="76%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6">Three Months Ended</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000">August 31, 2010</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Auction Rate</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Put Option</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Securities</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Fair value at beginning of period
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">952</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">13,323</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Settlements (at par)
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(14,275</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Realized gains (losses) included in
interest income, net
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(952</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">952</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Fair value at end of period
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">During the first quarter of fiscal 2011, we sold our remaining Auction Rate Securities (“ARS”) to
UBS AG (“UBS”) at par plus accrued interest, for $14,275 in cash when we exercised our put right
(the “Put Option”) under a November 2008 settlement agreement (“Agreement”) with UBS. As a result,
we included in earnings a realized gain of $952 attributable to the sale and a realized loss of
$952 attributable to the Put Option. The ARS were long-term debt instruments backed by student
loans, a substantial portion of which was guaranteed by the United States government. The ARS and
Put Option were valued from quotes received from our broker, UBS, which were derived from UBS’s
internally developed model. In accordance with accounting guidance, which permits an entity to
elect the fair value option for financial assets and liabilities, we elected to measure the Put
Option at fair value in order to match the changes in the fair value of the ARS.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 4 - us-gaap:BusinessCombinationDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 4: Acquisitions</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Equipment Management Technology, Inc.</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">On August 24, 2011, pursuant to an asset purchase agreement, we completed the purchase of certain
assets and the assumption of specified post-closing liabilities of Equipment Management Technology,
Inc., a Nevada Corporation (“EMT”), for cash consideration of $10,673. EMT, headquartered in Las
Vegas, Nevada, was a provider of electronic T&M equipment. We acquired EMT in order to facilitate
growth in our test and measurement (“T&M”) business. EMT had previously filed a voluntary petition
for relief under Chapter 11 of the Bankruptcy Code in the United States
Bankruptcy Court for the District of Nevada. The sale was approved by the Bankruptcy Court on
August 11, 2011, and the related sale order was issued on August 12, 2011. At closing, $500 was
deposited into an escrow account for any post-closing adjustments that reduce the purchase price.
We have accounted for the acquisition of EMT as a business combination in accordance with
accounting guidance.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">At August 31, 2011, we completed our estimates of the fair value of rental and lease equipment and
deferred revenue. Due to the timing of the acquisition we are still in the process of evaluating
the acquisition for possible intangible assets. We have also recorded a preliminary fair value
related to accounts receivable as final settlement of net accounts receivable will occur 60 days
after closing. We acquired gross accounts receivable of $972, of which an estimated $430 was not
expected to be collected, resulting in a preliminary fair value of $542. Once we have completed
our estimates of fair value of intangible assets and accounts receivable, we will have completed
the purchase accounting for the assets and liabilities in accordance with accounting guidance.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Under accounting guidance, a bargain purchase gain results if the fair value of the purchase
consideration is less than the net fair value of the assets acquired and liabilities assumed. We
recorded a bargain purchase gain of $3,194, net of deferred taxes, related to our acquisition of
EMT. We believe that we were able to negotiate a bargain purchase price as a result of our access
to the liquidity necessary to complete the transaction and EMT’s recurring losses and recent
bankruptcy filing.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The following table provides the preliminary fair values of the assets acquired and liabilities
assumed as of the date of acquisition.
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="88%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Total cash consideration
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">10,673</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Preliminary purchase price allocation:
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Accounts receivable
</div></td>
<td> </td>
<td> </td>
<td align="right">542</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Rental and lease equipment
</div></td>
<td> </td>
<td> </td>
<td align="right">15,896</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Deferred tax liability
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(2,092</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Deferred revenue
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(479</td>
<td nowrap="nowrap">)</td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:45px; text-indent:-15px">Net assets acquired
</div></td>
<td> </td>
<td> </td>
<td align="right">13,867</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Bargain purchase gain, net of deferred taxes of $2,092
</div></td>
<td> </td>
<td nowrap="nowrap" align="left">$</td>
<td align="right">(3,194</td>
<td nowrap="nowrap">)</td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The bargain purchase gain is classified separately in our condensed consolidated statements of
operations.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Acquisition-related transaction costs of $55, including $47 for the three months ended August 31,
2011, were accounted for as expenses in the periods in which the costs were incurred and are
included in our selling, general and administrative expenses.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The acquisition of EMT was an asset purchase, and EMT’s operations were integrated with ours
immediately after the acquisition date. Revenues and income before income taxes of $91 and $52,
respectively, from the acquired customers were included in our consolidated statements of
operations for the three months ended August 31, 2011.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Supplemental pro forma information reflecting the acquisition of EMT as if it occurred on June 1,
2010 is not practicable because we are not able to obtain reliable historical financial information
for 2010 and 2011, primarily due to a deterioration of the organization and controls leading up to
and following the February 2011 bankruptcy filing.
</div>
<div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Telogy, LLC</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">During fiscal 2011 we recorded additional bargain purchase gain associated with our March 31, 2010
acquisition of Telogy LLC (“Telogy”) of $342 ($202, net of deferred tax), of which $260 ($153, net
of deferred tax) was recorded during the three months ended August 31, 2010. The increase in the
bargain purchase gain consisted of (i) $260 representing the final determination of assets acquired
and other components of the purchase price in accordance with specific provisions of the APA, and
(ii) $82 resulting from a final determination of fair value of certain assets and liabilities
acquired from Telogy.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
</div>
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<!-- Begin Block Tagged Note 5 - us-gaap:DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 5: Equity Incentive Plan</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Our 2005 Equity Incentive Plan (the “Equity Incentive Plan”) authorizes our Board of Directors to
grant incentive and non-statutory stock option grants, stock appreciation rights, restricted stock
awards, restricted stock units, performance unit awards and performance share awards covering a
maximum of 1,000 shares of our common stock. The Equity Incentive Plan replaced our prior stock
option plans, under which there are no outstanding options. Pursuant to the Equity Incentive Plan,
we have granted incentive and non-statutory options to directors, officers and key employees at
prices not less than 100% of the fair market value on the day of grant. In addition, we have
granted restricted stock and restricted stock units to directors, officers and key employees. The
Equity Incentive Plan provides for a variety of vesting dates with the majority of the outstanding
grants vesting at a rate of one-third per year over a period of three years from the date of grant.
All outstanding options expire in October 2011.
</div>
<div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Stock Options</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The following table summarizes certain information relative to options for common stock:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="64%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Weighted</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Average</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Weighted</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Remaining</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Average</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Contractual</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Exercise</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Term (in</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Options</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Price</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">years)</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Outstanding at May 31, 2011
</div></td>
<td> </td>
<td> </td>
<td align="right">36</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">17.69</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Granted
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Exercised
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Forfeited/canceled
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Outstanding at August 31, 2011
</div></td>
<td> </td>
<td> </td>
<td align="right">36</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">17.69</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">0.1</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Vested and expected to vest at
August 31, 2011
</div></td>
<td> </td>
<td> </td>
<td align="right">36</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">17.69</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">0.1</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Vested and exercisable at August 31, 2011
</div></td>
<td> </td>
<td> </td>
<td align="right">36</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">17.69</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">0.1</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">There were no stock options granted or vested during the three months ended August 31, 2011 and
2010. The aggregate intrinsic value of options exercised is calculated as the difference between
the exercise price of the underlying awards and the closing price of our common stock on the Nasdaq
Stock Market on the date of measurement. The aggregate intrinsic value of options exercised during
the three months ended August 31, 2011 and 2010 was $0 and $7, respectively. Shares of newly
issued common stock are issued upon any exercise of stock options.
</div>
<div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Restricted Stock Units</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Restricted stock units represent the right to receive one share of our common stock, provided that
the vesting conditions are satisfied. The following table represents restricted stock unit
activity for the three months ended August 31, 2011:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="76%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Weighted</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Average</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Grant</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Restricted</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Date</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Stock Units</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Fair Value</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Nonvested at May 31, 2011
</div></td>
<td> </td>
<td> </td>
<td align="right">204</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">11.36</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Granted
</div></td>
<td> </td>
<td> </td>
<td align="right">84</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">16.83</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Vested
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(78</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">10.86</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Forfeited/canceled
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Nonvested at August 31, 2011
</div></td>
<td> </td>
<td> </td>
<td align="right">210</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">13.76</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We granted 84 and 96 restricted stock units during the three months ended August 31, 2011 and 2010,
respectively. As of August 31, 2011, we have unrecognized share-based compensation cost of
approximately $2,567 associated with restricted stock unit awards. This cost is expected to be
recognized over a weighted-average period of approximately 2.2 years.
</div>
<div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Accounting for Share Based Payments</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Accounting guidance requires all share-based payments to employees, including grants of employee
stock options, restricted stock and restricted stock units, to be recognized as compensation
expense in the consolidated financial statements based on their fair values. Compensation expense
is recognized over the period that an employee provides service in exchange for the award.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We use the Black-Scholes option pricing model to calculate the fair value of any option grant. Our
computation of expected volatility is based on historical volatility. Our computation of expected
term is determined based on historical experience of similar awards, giving consideration to the
contractual terms of the stock-based awards, vesting schedules and expectations of future employee
behavior. The expected term represents the period that our option awards are expected to be
outstanding and was determined based on historical experience of similar awards. The risk-free
interest rate is based on U.S. Treasury zero-coupon issues with a term equal to the expected term
of the option at the date of grant. Forfeitures are estimated at the date of grant based on
historical experience. We use the market price of our common stock on the date of grant to
calculate the fair value of each grant of restricted stock and restricted stock units.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We recorded $326 and $195 of stock-based compensation as part of selling, general and
administrative expenses for the three months ended August 31, 2011 and 2010, respectively.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We receive a tax deduction for certain stock option exercises during the period the options are
exercised, generally for the excess of the fair value of our common stock at the date of exercise
over the exercise price of the options, and dividends paid on vested restricted stock units.
Excess tax benefits are realized tax benefits from tax deductions for exercised options in excess
of the deferred tax asset attributable to stock compensation costs for such options. The total tax
benefit realized from stock option exercises, shares issued and dividend payments for vested
restricted stock units for the three months ended August 31, 2011 and 2010 was $36 and $14,
respectively. Cash received from stock option exercises was $0 and $149 for the three months ended
August 31, 2011 and 2010, respectively.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 6 - us-gaap:GoodwillAndIntangibleAssetsDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 6: Goodwill and Intangibles</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Goodwill represents the excess of the purchase price over the fair value of the net tangible and
identifiable intangible assets acquired in a business combination. Intangible assets resulting
from the acquisitions of entities accounted for using the purchase method of accounting are
recorded at the estimated fair value of the assets acquired. Identifiable intangible assets
consist of purchased customer relationships and trade names.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Our goodwill and intangibles at August 31, 2011 are the result of our acquisition of Telogy on
March 31, 2010 and of Rush Computer Rentals, Inc. on January 31, 2006. Our evaluation of
intangible assets, if any, associated with the acquisition of EMT on August 24, 2011 has not yet
been completed.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The changes in carrying amount of goodwill and other intangible assets for the three months ended
August 31, 2011 were as follows:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="64%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Balance as of</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">June 1, 2011 (net</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Balance as of</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">of amortization)</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Amortization</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">August 31, 2011</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Goodwill
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">3,109</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">3,109</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Trade name
</div></td>
<td> </td>
<td> </td>
<td align="right">411</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">411</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Customer relationships
</div></td>
<td> </td>
<td> </td>
<td align="right">803</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(29</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">774</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td> </td>
<td> </td>
<td colspan="11" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">4,323</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="left">$</td>
<td align="right">(29</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td align="left">$</td>
<td align="right">4,294</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td> </td>
<td> </td>
<td colspan="11" align="left" style="border-top: 3px double #000000"> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Goodwill is not deductible for tax purposes.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We evaluate the recoverability of goodwill and indefinite-lived intangible assets annually as of
May 31, and whenever events or changes in circumstances indicate to us that carrying amount may not
be recoverable. There were no conditions that indicated any impairment of goodwill or identifiable
intangible assets as of May 31, 2011.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Intangible assets with finite useful lives are amortized over their respective estimated useful
lives. The following table provides a summary of our intangible assets:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="52%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000">August 31, 2011</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Estimated</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Gross Carrying</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Accumulated</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Net Carrying</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Useful Life</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Amount</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Amortization</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Amount</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr style="font-size: 1px">
<td> </td>
<td> </td>
<td colspan="15" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Trade name
</div></td>
<td> </td>
<td colspan="3" align="center">indefinite</td>
<td> </td>
<td align="left">$</td>
<td align="right">411</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">411</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Customer relationships
</div></td>
<td> </td>
<td colspan="3" align="center">3-4 years</td>
<td> </td>
<td> </td>
<td align="right">1,954</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(1,180</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">774</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td> </td>
<td> </td>
<td colspan="15" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2,365</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="left">$</td>
<td align="right">(1,180</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td align="left">$</td>
<td align="right">1,185</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td> </td>
<td> </td>
<td colspan="15" align="left" style="border-top: 3px double #000000"> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="52%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000">May 31, 2011</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Estimated</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Gross Carrying</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Accumulated</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Net Carrying</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 0px solid #000000">Useful Life</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 0px solid #000000">Amount</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 0px solid #000000">Amortization</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 0px solid #000000">Amount</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr style="font-size: 1px">
<td> </td>
<td> </td>
<td colspan="15" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Trade name
</div></td>
<td> </td>
<td colspan="3" align="center">indefinite</td>
<td> </td>
<td align="left">$</td>
<td align="right">411</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">411</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Customer relationships
</div></td>
<td> </td>
<td colspan="3" align="center">3-4 years</td>
<td> </td>
<td> </td>
<td align="right">1,954</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(1,151</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">803</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td> </td>
<td> </td>
<td colspan="15" align="left" style="border-top: 1px solid #000000"> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">2,365</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="left">$</td>
<td align="right">(1,151</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td align="left">$</td>
<td align="right">1,214</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td> </td>
<td> </td>
<td colspan="15" align="left" style="border-top: 3px double #000000"> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Amortization expense related to intangible assets was $29 and $54 for the three months ended August
31, 2011 and 2010, respectively.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Amortization expense for customer relationships and non-compete agreements is included in selling,
general and administrative expenses. The following table provides estimated future amortization
expense related to intangible assets as of August 31, 2011:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="88%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">Future</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000">Year ending May 31,</td>
<td style="border-bottom: 1px solid #000000"> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Amortization</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">2012 (remaining)
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">88</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">2013
</div></td>
<td> </td>
<td> </td>
<td align="right">118</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">2014
</div></td>
<td> </td>
<td> </td>
<td align="right">118</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">2015
</div></td>
<td> </td>
<td> </td>
<td align="right">118</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">2016
</div></td>
<td> </td>
<td> </td>
<td align="right">118</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Thereafter
</div></td>
<td> </td>
<td> </td>
<td align="right">214</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">774</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 7 - elrc:NoncashInvestingAndFinancingActivitiesTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 7: Noncash Investing and Financing Activities</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We had accounts payable and other accruals related to acquired rental and lease equipment totaling
$5,308 and $4,860 as of August 31, 2011 and May 31, 2011, respectively, and $6,760 and $6,167 as of
August 31, 2010 and May 31, 2010, respectively, all of which amounts were subsequently paid.
During the three months ended August 31, 2011 and the fiscal year ended May 31, 2011, we
transferred $79 and $520, respectively, of demonstration equipment, included in other assets, to
rental and lease equipment. There were no similar activities for the three months ended August 31,
2010 or the fiscal year ended May 31, 2010. We had no accrual for dividends declared and not yet
paid in accrued expenses and as a reduction of retained earnings as of August 31, 2011 and May 31,
2011, respectively, compared to accruals of $3,596 and $0 as of August 31, 2010 and May 31, 2010,
respectively, all of which amounts were subsequently paid.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 8 - us-gaap:SaleLeasebackTransactionDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 8: Sales-Type Leases</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We have certain customer leases providing bargain purchase options, which are accounted for as
sales-type leases. Interest income is recognized over the life of the lease using the effective
interest method.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The initial acceptance of customer finance arrangements is based on an in-depth review of each
customer’s credit profile, including review of third party credit reports, customer financial
statements and bank verifications. We monitor the credit quality of our sales-type lease portfolio
based on payment activity that drives the finance lease receivable aging. This credit quality is
assessed on a monthly basis. There were no balances due for sales-type receivables beyond 90 days
as of August 31, 2011. Our historical losses on finance lease receivables are insignificant, and
therefore we do not have a specific allowance for credit losses.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The minimum lease payments receivable and the net investment included in other assets for such
leases were as follows:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="76%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">August 31,</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2">May 31,</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2011</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2011</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Gross minimum lease payments receivable
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">8,274</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">7,834</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Less — unearned interest
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(367</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(356</td>
<td nowrap="nowrap">)</td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Net investment in sales-type lease receivables
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">7,907</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">7,478</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The following table provides estimated future minimum lease payments receivable related to
sales-type leases:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="88%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000">Year ending May 31,</td>
<td style="border-bottom: 1px solid #000000"> </td>
<td style="border-bottom: 1px solid #000000"> </td>
<td style="border-bottom: 1px solid #000000"> </td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">2012 (remaining)
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">5,231</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">2013
</div></td>
<td> </td>
<td> </td>
<td align="right">2,530</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">2014
</div></td>
<td> </td>
<td> </td>
<td align="right">512</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">2015
</div></td>
<td> </td>
<td> </td>
<td align="right">1</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">8,274</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 9 - us-gaap:SegmentReportingDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 9: Segment Reporting and Related Disclosures</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Accounting guidance establishes reporting standards for an enterprise’s operating segments and
related disclosures about its products, services, geographic areas and major customers. Operating
segments are defined as components of an enterprise for which separate financial information is
available that is regularly evaluated by the chief operating decision maker in deciding how to
allocate resources and in assessing performance. In order to determine our operating segments, we
considered the following: an operating segment is a component of an enterprise (i) that engages in
business activities from which it may earn revenues and incur expenses, (ii) whose operating
results are regularly reviewed by the enterprise’s chief operating decision maker to make decisions
about resources to be allocated to the segment and assess its performance, and (iii) for which
discrete financial information is available. In accordance with this guidance, we have identified
two operating segments: the rental, lease and sale of T&M equipment and the rental, lease and sale
of data products (“DP”) equipment.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Although we have separate operating segments for T&M and DP equipment, these two segments are
aggregated into a single reportable segment because they have similar economic characteristics and
qualitative factors. The T&M and DP segments have similar long-term average gross margins, and
both rent, lease and sell electronic equipment to large corporations, purchase directly from major
manufacturers, configure and calibrate the equipment, and ship directly to customers.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Our equipment pool, based on acquisition cost, consisted of $367,564 of T&M equipment and $40,497
of DP equipment at August 31, 2011 and $347,138 of T&M equipment and $39,654 of DP equipment at May
31, 2011.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Revenues for these product groups were as follows for the three months ended August 31, 2011 and
2010:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="64%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">T&M</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">DP</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">Total</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">2011
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Rentals and leases
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">26,602</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">4,707</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">31,309</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Sales of equipment and other revenues
</div></td>
<td> </td>
<td> </td>
<td align="right">26,716</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">625</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">27,341</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">53,318</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">5,332</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">58,650</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">2010
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Rentals and leases
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">24,037</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">4,750</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">28,787</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Sales of equipment and other revenues
</div></td>
<td> </td>
<td> </td>
<td align="right">21,370</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">668</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">22,038</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">45,407</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">5,418</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">50,825</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">No single customer accounted for more than 10% of total revenues during the three months ended
August 31, 2011 and 2010.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Selected country information is presented below:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="76%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6">Three Months Ended</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000">August 31,</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2011</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2010</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Revenues: (1)
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">U.S.
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">50,087</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">45,124</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Other (2)
</div></td>
<td> </td>
<td> </td>
<td align="right">8,563</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">5,701</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Total
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">58,650</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">50,825</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="76%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000">As of</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">August 31, 2011</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">May 31, 2011</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Net Long-Lived Assets: (3)
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">U.S.
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">203,022</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">180,591</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Other (2)
</div></td>
<td> </td>
<td> </td>
<td align="right">35,763</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">33,491</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Total
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">238,785</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">214,082</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left">
<div style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000"> 
</div>
</div>
<table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left">
<tr>
<td width="3%"></td>
<td width="1%"></td>
<td width="96%"></td>
</tr>
<tr valign="top">
<td nowrap="nowrap" align="left">(1)</td>
<td> </td>
<td>Revenues by country are based on the location of shipping destination, and not whether the
order originates in the United States parent or a foreign subsidiary.</td>
</tr>
<tr style="font-size: 3pt">
<td> </td>
</tr>
<tr valign="top">
<td nowrap="nowrap" align="left">(2)</td>
<td> </td>
<td>Other consists of foreign countries that each individually account for less than 10% of the
total revenues or assets.</td>
</tr>
<tr style="font-size: 3pt">
<td> </td>
</tr>
<tr valign="top">
<td nowrap="nowrap" align="left">(3)</td>
<td> </td>
<td>Net long-lived assets include rental and lease equipment, other property, goodwill and
intangibles, net of accumulated depreciation and amortization.</td>
</tr>
</table>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 10 - us-gaap:EarningsPerShareTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 10: Computation of Earnings Per Share</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">The following is a reconciliation of the denominator used in the computation of basic and diluted
earnings per share for the three months ended August 31, 2011 and 2010:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="76%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6">Three Months Ended</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000">August 31,</td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2011</td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">2010</td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Denominator:
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Denominator for basic earnings per share -
weighted average common shares outstanding
</div></td>
<td> </td>
<td> </td>
<td align="right">23,981</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">23,964</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Effect of dilutive options and restricted stock (1)
</div></td>
<td> </td>
<td> </td>
<td align="right">151</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">83</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Diluted shares used in per share calculation
</div></td>
<td> </td>
<td> </td>
<td align="right">24,132</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">24,047</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:30px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Net income
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">8,505</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">5,221</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Earnings per share:
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Basic
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">0.35</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">0.22</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Diluted
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">0.35</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">0.22</td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left">
<div style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000"> 
</div>
</div>
<table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left">
<tr>
<td width="3%"></td>
<td width="1%"></td>
<td width="96%"></td>
</tr>
<tr valign="top">
<td nowrap="nowrap" align="left">(1)</td>
<td> </td>
<td>Excludes 36 options outstanding during both the three months ended August 31, 2011 and 2010,
for which the exercise price exceeded the average market price of our common stock during that
period.</td>
</tr>
</table>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 11 - us-gaap:IncomeTaxDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 11: Income Taxes</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We recognize a liability or asset for the deferred tax consequences of temporary differences
between the tax basis of assets and liabilities and their reported amounts in the financial
statements. These temporary differences will result in taxable or deductible amounts in future
years when reported amounts of the assets or liabilities are recovered or settled. The deferred
tax assets are periodically reviewed for recoverability.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">On June 1, 2007, we adopted new accounting guidance which establishes a single model to address the
accounting for uncertain tax positions. Specifically, it prescribes a recognition threshold that a
tax position is required to meet before being recognized in the financial statements and provides
guidance on derecognition, measurement, classification, interest and penalties, accounting in
interim periods, disclosure and transition issues.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We recognize the tax impact from an uncertain tax position only if it is more likely than not that
the tax position will be sustained on examination by the taxing authorities, based on the technical
merits of the position. The tax impact recognized in the financial statements from such a position
is measured based on the largest benefit that has a greater than 50% likelihood of being realized
upon ultimate resolution. We recognize interest, penalties and foreign currency gains and losses
with respect to uncertain tax positions as components of our income tax provision. Accrued
interest and penalties are included within accrued expenses in the consolidated balance sheet.
Significant judgment is required in the identification of uncertain tax positions and in the
estimation of penalties and interest on uncertain tax positions. During the second quarter of
fiscal 2011 we effectively settled our remaining uncertain tax positions, and derecognized $4,515
of previously recognized uncertain tax positions, and the related deferred tax asset, and $1,396
for interest and penalties previously recognized.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We are subject to taxation in the U.S., as well as various states and foreign jurisdictions. We
have substantially settled all income tax matters for the United States federal jurisdiction for
years through fiscal 2009. Major state jurisdictions have been examined through fiscal years 2004
and 2005, and foreign jurisdictions have not been examined for their respective maximum statutory
periods.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">There were no unrecognized tax benefits for the three months ended August 31, 2011.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 12 - us-gaap:CommitmentsAndContingenciesDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 12pt"><b>Note 12: Commitments and Contingencies</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We purchase substantial amounts of rental equipment from numerous vendors. As a result, we have
occasionally been included as a member of the plaintiff class in class action lawsuits related to
product warranties or price adjustments.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif">
<div align="center" style="font-size: 10pt; margin-top: 0pt">
<b>
</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">Settlements of such claims can result in distributions of cash or product coupons that can be
redeemed, sold or used to purchase new equipment. We recognize any benefits from such settlements
when all contingencies have expired, to the extent either cash has been received and/or realization
of value from any coupon is assured.
</div>
<div align="left" style="font-size: 10pt; margin-top: 6pt">We are subject to legal proceedings and business disputes involving ordinary routine legal
proceedings and claims incidental to our business. The ultimate legal and financial liability with
respect to such matters generally cannot be estimated with certainty and requires the use of
estimates in recording liabilities for potential litigation settlements. Estimates for losses from
litigation are made after consultation with outside counsel. If estimates of potential losses
increase or the related facts and circumstances change in the future, we may be required to record
either more or less litigation expense. We are not involved in any pending or threatened legal
proceedings, other than ordinary routine legal proceedings and claims incidental to our business,
that we believe could reasonably be expected to have a material adverse effect on our financial
condition, results of operations or cash flows.
</div>
</div>