<SEC-DOCUMENT>0001437749-17-020686.txt : 20171214
<SEC-HEADER>0001437749-17-020686.hdr.sgml : 20171214
<ACCEPTANCE-DATETIME>20171214134018
ACCESSION NUMBER:		0001437749-17-020686
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		4
CONFORMED PERIOD OF REPORT:	20171212
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20171214
DATE AS OF CHANGE:		20171214

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			LRAD Corp
		CENTRAL INDEX KEY:			0000924383
		STANDARD INDUSTRIAL CLASSIFICATION:	HOUSEHOLD AUDIO & VIDEO EQUIPMENT [3651]
		IRS NUMBER:				870361799
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-24248
		FILM NUMBER:		171255770

	BUSINESS ADDRESS:	
		STREET 1:		16990 GOLDENTOP RD., STE. A
		CITY:			SAN DIEGO
		STATE:			CA
		ZIP:			92127
		BUSINESS PHONE:		858-676-1112

	MAIL ADDRESS:	
		STREET 1:		16990 GOLDENTOP RD., STE. A
		CITY:			SAN DIEGO
		STATE:			CA
		ZIP:			92127

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	AMERICAN TECHNOLOGY CORP /DE/
		DATE OF NAME CHANGE:	19940602
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>lrad20171212_8k.htm
<DESCRIPTION>FORM 8-K
<TEXT>
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<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:12pt;margin:0pt;text-align:center;"><b>UNITED STATES</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:12pt;margin:0pt;text-align:center;"><b>SECURITIES AND EXCHANGE COMMISSION</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:12pt;margin:0pt;text-align:center;"><b>WASHINGTON<font style="font-family:Times New Roman, Times, serif;font-size:12pt;">, D.C. 20549</font></b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">____________________</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>&nbsp;</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:12pt;margin:0pt;text-align:center;"><b>FORM 8-K</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>&nbsp;</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>CURRENT REPORT</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>Pursuant to Section 13 or 15(d) of</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>the Securities Exchange Act of 1934</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">Date of Report (Date of earliest event reported): <font style="font-family:Times New Roman, Times, serif;font-size:10pt;">December 12, 2017</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:24pt;margin:0pt;text-align:center;"><b>LRAD Corporation</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">(Exact name of registrant as specified in its charter)</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">&nbsp;</p>

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			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><u><b>&nbsp;<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0</font></b></u><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><u><b>00-24248</b></u><u><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b></u></font></p>
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			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><u><b>&nbsp;<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&nbsp;&nbsp;&nbsp;&nbsp;87-0</font></b></u><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><u><b>361799</b></u><u><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b></u></font></p>
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			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">(State or Other Jurisdiction of</p>

			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">Incorporation)</p>
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			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">(Commission</p>

			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">File Number)</p>
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			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">(I.R.S. Employer</p>

			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">Identification No.)</p>
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<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">&nbsp;</p>

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			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>16990 Goldentop Road</b><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><b>, Ste. A</b></font></p>
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			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>San Diego, California 9212</b><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><b>7</b></font></p>
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<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">(Address of Principal Executive Offices)</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">____________________</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>858-676-1112</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">(Registrant<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&rsquo;s telephone number, including area code)</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">N/A</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">(Former name or former address, if changed since last report.)</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">&nbsp;</p>

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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;">[ ]</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</font></p>
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<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;">[<font style="font-size:10pt;font-family:Times New Roman, Times, serif;"> ]</font></p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14.a-12)</font></p>
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<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;">[ ]</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</font></p>
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<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;">[ ]</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</font></p>
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<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin-bottom:0pt;margin-left:18pt;margin-right:0pt;margin-top:0pt;text-align:left;text-indent:-18pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">Indicate by check mark whether the registrant<font style="font-family:Times New Roman, Times, serif;font-size:10pt;"> is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR &sect;230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR &sect;240.12b-2).</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">Emerging growth company <font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&#9744;</font></p>

<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">If an <font style="font-family:Times New Roman, Times, serif;font-size:10pt;">emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. </font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&#9744;</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">&nbsp;</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin-bottom:0pt;margin-left:72pt;margin-right:0pt;margin-top:0pt;text-align:left;text-indent:-72pt;"><b>Item<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&nbsp;2.02 Results of Operations and Financial Condition.</font></b></p>

<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;text-indent:27pt;">The following information is furnished pursuant to Item 2.02, &ldquo;Results of Operations and Financial Condition,&rdquo; and shall not be deemed &ldquo;filed&rdquo; for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. Such information, including Exhibit 99.1, shall not be incorporated by reference into any filing of <font style="font-family:Times New Roman, Times, serif;font-size:10pt;">LRAD Corporation (the &ldquo;Company&rdquo;), whether made before or after the date hereof, regardless of any general incorporation language in such filing.</font></p>

<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;text-indent:27.35pt;">On <font style="font-family:Times New Roman, Times, serif;font-size:10pt;">December 12, 2017, the Company issued a press release regarding its financial results for the fiscal year ended September 30, 2017 and held a related conference call to discuss such results. Copies&nbsp;of the press release and the transcript of the conference call are furnished as Exhibits 99.1 and 99.2 hereto, and are&nbsp;incorporated by reference herein.</font></p>

<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin-bottom:0pt;margin-left:72pt;margin-right:0pt;margin-top:0pt;text-align:left;text-indent:-72pt;"><b>Item 9.01 </b><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><b>Financial Statements and Exhibits</b></font></p>

<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

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			<p style="margin: 0pt;">(d)<font style="font-family:Times New Roman, Times, serif; font-size:10pt">&nbsp;</font></p>
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			<td style="vertical-align:top;">
			<p style="margin: 0pt;"><font style="font-family:Times New Roman, Times, serif; font-size:10pt"><u>Exhibits</u>.</font></p>
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			<td style="width:36pt;vertical-align:top;">&nbsp;</td>
			<td style="vertical-align:top;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;">99.1</p>
			</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-top:0pt;text-align:left;margin-bottom:0pt;font-size:10pt;"><a href="ex_101997.htm" style="-sec-extract:exhibit;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Financial Results Press Release, dated December 12, 2017, issued by LRAD Corporation.</font></a></p>
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			<td style="width:36pt;vertical-align:top;">&nbsp;</td>
			<td style="vertical-align:top;">&nbsp;</td>
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			<td style="width:36pt;vertical-align:top;">99.2</td>
			<td style="vertical-align:top;"><a href="ex_102094.htm" style="-sec-extract:exhibit;">Transcript of conference call of LRAD Corporation held on December 12, 2017.</a></td>
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<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;text-indent:36pt;"><b>SIGNATURES</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;text-indent:36pt;"><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;text-indent:36pt;">&nbsp;</p>

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			<p style="margin: 0pt;">Date: <font style="font-family:Times New Roman, Times, serif; font-size:10pt">December 14, 2017</font></p>
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			<td colspan="2" valign="top" width="38%">
			<p style="margin-top: 0; margin-bottom: 0;"><font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">&nbsp;</font></p>
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			<p style="margin-top: 0; margin-bottom: 0;"><font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">&nbsp;</font></p>
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			<p style="margin-top: 0; margin-bottom: 0;"><font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">&nbsp;</font></p>
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			<p style="margin-top: 0; margin-bottom: 0;">LRAD Corporation<font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">&nbsp;</font></p>
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			<td valign="top" width="12%">
			<p style="margin-top: 0; margin-bottom: 0;"><font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">&nbsp;</font></p>
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			<p style="margin-top: 0; margin-bottom: 0;"><font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">&nbsp;</font></p>
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			<p style="margin-top: 0; margin-bottom: 0;"><font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">&nbsp;</font></p>
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			<p style="margin-top: 0; margin-bottom: 0;"><font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">By: </font></p>
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			<p style="margin-top: 0; margin-bottom: 0;"><font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">/s/&nbsp;</font>Dennis D. Klahn</p>
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			<p style="margin-top: 0; margin-bottom: 0;">Dennis D. Klahn<font style="FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">&nbsp;</font></p>
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<TYPE>EX-99.1
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<FILENAME>ex_101997.htm
<DESCRIPTION>EXHIBIT 99.1
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<p style="margin-bottom: 0px; text-align: right; margin-top: 0px"><font style="font-size: 10pt; font-family: Times New Roman, Times, serif"><b>Exhibit 99.1</b></font></p>

<p style="margin-bottom: 0px; text-align: left; margin-top: 0px"><font style="font-size: 10pt; font-family: Times New Roman, Times, serif">&nbsp;</font></p>

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<p style="font-family:Times New Roman, Times, serif;font-size:12pt;margin:0pt;text-align:center;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:12pt;margin:0pt;text-align:center;"><b>LRAD</b><font style="font-family:Times New Roman, Times, serif;font-size:12pt;"><sup><b>&reg;</b></sup><b> </b><b>Corporation</b><b> </b><b>Reports Fiscal Year 2017</b><b> Financial Results</b></font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:12pt;margin:0pt;text-align:center;"><b>&nbsp;</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;"><b>SAN DIEGO, CA </b><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><b>&ndash;</b><b> </b><b>December </b><b>12, 2017</b><b> - </b></font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><b>LRAD Corporation (NASDAQ: LRAD)</b>, </font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">the world&rsquo;s leading provider of acoustic hailing devices (&ldquo;AHDs&rdquo;) and advanced mass notification systems, today announced financial results for the fiscal year ended September 30, 2017</font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">.</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;"><b>Fiscal Year 2017</b><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><b> Financial Summary</b></font></p>

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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;"><b>Revenues</b>: Fiscal year 2017 revenues totaled $20.3 million, compared to $16.4 million reported in fiscal year 2016.</font></p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">o</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">The 24% increase in revenues was primarily driven by a 224% increase in mass notification system </font><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">sales. International and domestic revenues increased 24% and 18% respectively over the prior year.</font></p>
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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;"><b>Net Loss</b>:<b> </b>The Company reported a net loss of $877,000, or $0.03 per share, for fiscal 2017, compared with a net loss of $1.3 million, or $0.04 per share, in fiscal 2016</font><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">.</font></p>
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			<td style="width:54pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">o</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Gross margin improved to 50.6%, compared to 46.9% in the prior fiscal year, as improved revenues led to higher fixed overhead absorption and gross profit of $10.3 million, 34% higher than fiscal 2016.</font></p>
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			<td style="width:54pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">o</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Selling, general and administrative expenses increased $1.7 million, or 25%, from fiscal 2016, primarily due to higher incentive and non-cash compensation, investments in sales and engineering personnel,</font><font style="font-size:10pt;font-family:Times New Roman, Times, serif;"> </font><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">and expenses associated with the implementation of a new enterprise resource planning system.</font></p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">o</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Net loss declined to $877,000 from $1.3 million in fiscal 2016, which included $198,000 in fiscal 2017 tax expense versus a tax benefit of $186,000 in the prior fiscal year.</font></p>
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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;"><b>Balance Sheet</b>: Cash and cash equivalents totaled $12.8 million at September 30, 2017, down from $13.5 million reported at September 30, 2016. </font></p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">o</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Lower cash and cash equivalents were<b> </b>primarily due to</font><font style="font-size:10pt;font-family:Times New Roman, Times, serif;"> large product shipments near the end of the fiscal fourth quarter, which resulted in a $2.3 million increase in accounts receivable compared to the prior year.</font></p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">o</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Working capital totaled $25.4 million at September 30, 2017, compared to $23.1 million at September 30, 2016. </font></p>
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<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&ldquo;<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">Our investments in additional sales and engineering personnel and the expansion of our AHD and mass notification product lines are beginning to bear fruit</font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">, as demonstrated by the $7.5 million in fiscal Q4 2017 revenues reported today, 53% higher than the $4.9 million in revenues recorded in fiscal Q4 2016</font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">,&rdquo; </font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">remarked Richard S. Danforth, Chief Executive Officer of LRAD Corporation. &ldquo;Bookings in fiscal 2017 increased in all our geographic sales regions over fiscal 2016, totaling a record $28.4 million. Backlog at September 30, 2017 was $11.9 million</font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">, compared to $3.1 million at the end of fiscal 2016</font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">.&rdquo; </font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&nbsp;</p>

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<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;"><b>Select</b><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><b> Fiscal Year 2017</b><b> Operating and Business Highlights</b></font></p>

<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Announced our largest domestic order to date, a $6.0 million U.S. Army Program of Record order that is part of a larger AHD requirement.</font></p>
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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Received several orders from the U.S. Military, including a $2.4 million Air National Guard order for LRAD 360XL-MID Mobile Kits, $1.1 million in U.S. Navy orders, which included our first order for a Naval Construction Battalion, and a $900,000 military-grade LRAD 360XT mobile mass notification systems order for U.S. Army forward operating bases in the Middle East.</font></p>
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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Announced $2.9 million in LRAD 360XT orders for one of the largest oil &amp; gas companies in Eurasia. The mobile mass notification systems are equipped with our solar power option and being integrated with a gas detection alarm system.</font></p>
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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Received $4.0 million in AHD public safety orders from Southeast Asia and $1.2 million in additional AHD orders from international regions other than Southeast Asia.</font></p>
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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Appointed Dennis D. Klahn as Chief Financial Officer.</font></p>
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			<td style="width:18pt;">&nbsp;</td>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;">&#9679;</p>
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			<p style="font-family:Times New Roman, Times, serif;margin-right:0pt;margin-top:0pt;text-align:justify;margin-bottom:0pt;font-size:10pt;"><font style="font-size:10pt;font-family:Times New Roman, Times, serif;">Launched eight new products: LRAD SoundSaber-X, LRAD DS-60X, LRAD DS-60XL, LRAD 360XL, LRAD 360XL-MID, LRAD 360XL-MID Mobile Kit, LRAD 950RXL and LRAD 1950XL.</font></p>
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<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&ldquo;<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">In fiscal 2018, we are continuing to pursue global market opportunities by increasing and strengthening partnerships, expanding our product lines and exploring prospects to accelerate growth in our mass notification business,&rdquo; added Danforth. &ldquo;Based on the robust bookings trend and the significant growth of addressable backlog, we are off to a strong start in fiscal 2018.</font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&rdquo;</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">We include in this press release Non-GAAP operational metrics of bookings and backlog, which we believe provide helpful information to investors with respect to evaluating the Company<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&rsquo;s performance. We consider bookings and backlog as leading indicators of future revenues and use these metrics to support production planning. Bookings is an internal, operational metric that measures the total dollar value of customer purchase orders executed in a period, regardless of the timing of the related revenue recognition. Backlog is a measure of purchase orders received that have not been shipped, but are planned to ship within the next 12 months.</font></p>

<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;"><b>Webcast and Conference Call Details</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">Management will host a conference call to discuss fiscal year <font style="font-family:Times New Roman, Times, serif;font-size:10pt;">2017 financial results this afternoon at 4:30 p.m. E.T. To access the conference call, dial toll-free 888.567.1602, or international at 404.267.0373. A webcast will also be available at the following link: https://www.webcaster4.com/Webcast/Page/1375/23623. </font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">A replay of the call will be available approximately four hours after the call concludes, and remain available for 90 days at the aforementioned webcast link. </font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">Questions to management may be submitted before or during the call by emailing them to: investor@lrad.com.</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;"><b>About LRAD Corporation</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">Using advanced technology and superior voice intelligibility, LRAD Corporation<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">&rsquo;s proprietary Long Range Acoustic Devices<sup>&reg;</sup> and revolutionary ONE VOICE<sup>&reg;</sup> mass notification systems are designed to enable users to safely hail and warn, inform and direct, prevent misunderstandings, determine intent, establish large safety zones, resolve uncertain situations, and save lives. LRAD systems are in service in more than 70 countries around the world in diverse applications including mass notification and public address, fixed and mobile defense deployments, homeland, border, critical infrastructure, maritime, oil &amp; gas, and port security, public safety, law enforcement and emergency responder communications, asset protection, and wildlife control and preservation. For more information, please visit www.LRAD.com</font><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">. </font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&nbsp;</p>

<div id="PGBK" style="width: 100%; margin-left: 0pt; margin-right: 0pt">
<div id="PGNUM" style="text-align: center; width: 100%">&nbsp;</div>

<hr style="PAGE-BREAK-AFTER: always; border: none; width: 100%; height: 2px; color: #000000; background-color: #000000">
<div id="PGHDR" style="text-align: left; width: 100%">&nbsp;</div>
</div>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;"><b>Forward Looking Statements </b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">Except for historical information contained herein, the matters discussed are forward-looking statements within the meaning of Section <font style="font-family:Times New Roman, Times, serif;font-size:10pt;">21E of the Securities Exchange Act of 1934. You should not place undue reliance on these statements. We base these statements on particular assumptions that we have made in light of our industry experience, the stage of product and market development as well as our perception of historical trends, current market conditions, current economic data, expected future developments and other factors that we believe are appropriate under the circumstances. These statements involve risks and uncertainties that could cause actual results to differ materially from those suggested in the forward-looking statements. These risks and uncertainties are identified and discussed in our filings with the Securities and Exchange Commission. These forward-looking statements are based on information and management&rsquo;s expectations as of the date hereof. Future results may differ materially from our current expectations. For more information regarding other potential risks and uncertainties, see the &ldquo;Risk Factors&rdquo; section of the Company&rsquo;s Form 10-K for the fiscal year ended September 30, 2017. LRAD Corporation disclaims any intent or obligation to update those forward-looking statements, except as otherwise specifically stated.</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&nbsp;</p>

<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">&nbsp;</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;"><b>Company Contact</b></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">E. Brian Harvey</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">Director, Investor Relati<font style="font-family:Times New Roman, Times, serif;font-size:10pt;">ons and Capital Markets</font></p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">858.753.8974</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">ebharvey@lrad.com</p>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:justify;">&nbsp;</p>

<div id="PGBK" style="width: 100%; margin-left: 0pt; margin-right: 0pt">
<div id="PGNUM" style="text-align: center; width: 100%">&nbsp;</div>

<hr style="PAGE-BREAK-AFTER: always; border: none; width: 100%; height: 2px; color: #000000; background-color: #000000">
<div id="PGHDR" style="text-align: left; width: 100%">&nbsp;</div>
</div>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<table border="0px" cellpadding="0pt" cellspacing="0pt" id="TBL16" style="margin: 0pt; width: 100%; text-indent: 0px; font-size: 10pt;">

		<tr>
			<td colspan="5" style="vertical-align:bottom;width:100.2%;">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>LRAD Corporation and Subsidiary</b></p>
			</td>
		</tr>
		<tr>
			<td colspan="5" style="vertical-align:bottom;width:100.2%;">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>Consolidated Balance Sheets</b></p>
			</td>
		</tr>
		<tr>
			<td colspan="5" style="vertical-align:bottom;width:100.2%;">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>(000&#39;s omitted)</b></p>
			</td>
		</tr>

</table>

<p style="margin: 0pt;">&nbsp;</p>

<table border="0" cellpadding="0" cellspacing="0" class="finTable" style="width: 100%; font-size: 10pt; font-family: Times New Roman, Times, serif; text-indent: 0px;">

		<tr style="vertical-align: bottom;">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".lead.D3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td colspan="6" id=".amt.D3" style="text-align: center; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b><b>September 30,</b></b></p>
			</td>
			<td id=".trail.D3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom;">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".lead.D2" style="font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td colspan="2" id=".amt.D2" style="text-align: center; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b><b>2017</b></b></p>
			</td>
			<td id=".trail.D2" style="font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".lead.D3" style="font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td colspan="2" id=".amt.D3" style="text-align: center; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b><b>2016</b></b></p>
			</td>
			<td id=".trail.D3" style="font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom;">
			<td>&nbsp;</td>
			<td id=".lead.B2">&nbsp;</td>
			<td id=".symb.B2">&nbsp;</td>
			<td id=".amt.B2">&nbsp;</td>
			<td id=".trail.B2">&nbsp;</td>
			<td id=".lead.B3">&nbsp;</td>
			<td id=".symb.B3">&nbsp;</td>
			<td id=".amt.B3">&nbsp;</td>
			<td id=".trail.B3">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt; width: 70%;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>ASSETS</b></p>
			</td>
			<td id=".lead.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B2" style="text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".lead.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B3" style="text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Current assets:</b></p>
			</td>
			<td id=".lead.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B2" style="text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".lead.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B3" style="text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Cash and cash equivalents</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">12,804</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">13,467</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Short-term marketable securities</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">4,360</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">2,936</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Accounts receivable</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">5,682</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">3,409</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Inventories, net</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">5,257</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">4,764</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Prepaid expenses and other</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">983</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">596</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Total current assets</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">29,086</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">25,172</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Long-term marketable securities</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">711</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">2,188</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Deferred tax assets</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">8,331</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">8,527</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Property and equipment, net</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">510</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">473</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Intangible assets, net</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">56</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">63</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Prepaid expenses and other - noncurrent</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">164</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">391</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Total assets</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 3px;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">38,858</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 3px;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">36,814</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td>&nbsp;</td>
			<td id=".lead.B2">&nbsp;</td>
			<td id=".symb.B2">&nbsp;</td>
			<td id=".amt.B2">&nbsp;</td>
			<td id=".trail.B2">&nbsp;</td>
			<td id=".lead.B3">&nbsp;</td>
			<td id=".symb.B3">&nbsp;</td>
			<td id=".amt.B3">&nbsp;</td>
			<td id=".trail.B3">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>LIABILITIES AND STOCKHOLDERS&#39; EQUITY</b></p>
			</td>
			<td id=".lead.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B2" style="text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".lead.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B3" style="text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Current liabilities:</b></p>
			</td>
			<td id=".lead.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B2" style="text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B2" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".lead.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B3" style="text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B3" style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Accounts payable</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">1,112</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">575</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;">Accrued liabilities</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">2,562</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">1,503</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Total current liabilities</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">3,674</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">2,078</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Other liabilities </b><font style="font-family:Times New Roman, Times, serif;font-size:10pt;"><b>&ndash;</b><b> noncurrent</b></font></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">-</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">165</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Total liabilities</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">3,674</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">2,243</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Total stockholders&#39; equity</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">35,184</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">34,571</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: Times New Roman, Times, serif; font-size: 10pt;">
			<p style="font-family: Times New Roman, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Total liabilities and stockholders&#39; equity</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 3px;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">38,858</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; padding-bottom: 3px;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">36,814</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: Times New Roman, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">&nbsp;</td>
		</tr>

</table>

<p style="margin: 0pt;">&nbsp;</p>

<div id="PGBK" style="width: 100%; margin-left: 0pt; margin-right: 0pt">
<div id="PGNUM" style="text-align: center; width: 100%">&nbsp;</div>

<hr style="PAGE-BREAK-AFTER: always; border: none; width: 100%; height: 2px; color: #000000; background-color: #000000">
<div id="PGHDR" style="text-align: left; width: 100%">&nbsp;</div>
</div>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<table border="0px" cellpadding="0pt" cellspacing="0pt" id="TBL17" style="width: 100%; text-indent: 0px; font-size: 10pt; margin: 0pt;">

		<tr>
			<td colspan="5" style="vertical-align:bottom;width:100%;">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>LRAD Corporation and Subsidiary</b></p>
			</td>
		</tr>
		<tr>
			<td colspan="5" style="vertical-align:bottom;width:100%;">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>Consolidated Statements of Operation</b></p>
			</td>
		</tr>
		<tr>
			<td colspan="5" style="vertical-align:bottom;width:100%;">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b>(000&#39;s omitted except share and per share amounts)</b></p>
			</td>
		</tr>

</table>

<p style="margin: 0pt;">&nbsp;</p>

<table border="0" cellpadding="0" cellspacing="0" class="finTable" style="width: 100%; font-size: 10pt; font-family: &quot;Times New Roman&quot;, Times, serif; text-indent: 0px;">

		<tr style="vertical-align: bottom;">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".lead.D3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td colspan="6" id=".amt.D3" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b><b>Years Ended September 30,</b></b></p>
			</td>
			<td id=".trail.D3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom;">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".lead.D2" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td colspan="2" id=".amt.D2" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b><b>2017</b></b></p>
			</td>
			<td id=".trail.D2" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
			<td id=".lead.D3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td colspan="2" id=".amt.D3" style="text-align: center; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">
			<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:center;"><b><b>2016</b></b></p>
			</td>
			<td id=".trail.D3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom;">
			<td>&nbsp;</td>
			<td id=".lead.B2">&nbsp;</td>
			<td id=".symb.B2">&nbsp;</td>
			<td id=".amt.B2">&nbsp;</td>
			<td id=".trail.B2">&nbsp;</td>
			<td id=".lead.B3">&nbsp;</td>
			<td id=".symb.B3">&nbsp;</td>
			<td id=".amt.B3">&nbsp;</td>
			<td id=".trail.B3">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; width: 70%;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Revenues</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">20,314</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">16,361</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Cost of revenues</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">10,036</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">8,689</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Gross profit</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">10,278</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">7,672</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td>&nbsp;</td>
			<td id=".lead.B2">&nbsp;</td>
			<td id=".symb.B2">&nbsp;</td>
			<td id=".amt.B2">&nbsp;</td>
			<td id=".trail.B2">&nbsp;</td>
			<td id=".lead.B3">&nbsp;</td>
			<td id=".symb.B3">&nbsp;</td>
			<td id=".amt.B3">&nbsp;</td>
			<td id=".trail.B3">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Operating expenses:</b></p>
			</td>
			<td id=".lead.B2" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B2" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B2" style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B2" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".lead.B3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B3" style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;"><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">Selling, general and administrative</font></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">8,586</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">6,877</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;"><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">Research and development</font></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">2,500</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">2,388</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Total operating expenses</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">11,086</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">9,265</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td>&nbsp;</td>
			<td id=".lead.B2">&nbsp;</td>
			<td id=".symb.B2">&nbsp;</td>
			<td id=".amt.B2">&nbsp;</td>
			<td id=".trail.B2">&nbsp;</td>
			<td id=".lead.B3">&nbsp;</td>
			<td id=".symb.B3">&nbsp;</td>
			<td id=".amt.B3">&nbsp;</td>
			<td id=".trail.B3">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Loss from operations</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">(808</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">(1,593</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Other income</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">129</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">125</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Loss from operations before income taxes</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">(679</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">(1,468</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;">Income tax (benefit) expense</p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">198</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 1px; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 1px solid rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 1px solid rgb(0, 0, 0);">(186</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 1px;">)</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Net loss</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(877</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">$</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">(1,282</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; padding-bottom: 3px;">)</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td>&nbsp;</td>
			<td id=".lead.B2">&nbsp;</td>
			<td id=".symb.B2">&nbsp;</td>
			<td id=".amt.B2">&nbsp;</td>
			<td id=".trail.B2">&nbsp;</td>
			<td id=".lead.B3">&nbsp;</td>
			<td id=".symb.B3">&nbsp;</td>
			<td id=".amt.B3">&nbsp;</td>
			<td id=".trail.B3">&nbsp;</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Net loss per common share - basic and diluted</b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">(0.03</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">$</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">(0.04</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt;">)</td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(204, 238, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt;"><b>Weighted average common shares outstanding:</b></p>
			</td>
			<td id=".lead.B2" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B2" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B2" style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B2" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".lead.B3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.B3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".amt.B3" style="text-align: left; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
			<td id=".trail.B3" style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;"><b>&nbsp;</b></td>
		</tr>
		<tr style="vertical-align: bottom; background-color: rgb(255, 255, 255);">
			<td style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">
			<p style="font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-top: 0pt; margin-bottom: 0pt; margin-left: 9pt;"><b><font style="font-family:Times New Roman, Times, serif;font-size:10pt;">Basic and diluted</font></b></p>
			</td>
			<td id=".lead.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.2" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 3px double rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.2" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">31,855,430</td>
			<td id=".trail.2" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td>
			<td id=".lead.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt;">&nbsp;</td>
			<td id=".symb.3" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; border-bottom: 3px double rgb(0, 0, 0);">&nbsp;</td>
			<td id=".amt.3" style="width: 12%; text-align: right; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; margin-left: 0pt; border-bottom: 3px double rgb(0, 0, 0);">31,970,600</td>
			<td id=".trail.3" nowrap="true" style="width: 1%; font-family: &quot;Times New Roman&quot;, Times, serif; font-size: 10pt; padding-bottom: 3px; margin-left: 0pt;">&nbsp;</td>
		</tr>

</table>

<p style="font-family:Times New Roman, Times, serif;font-size:10pt;margin:0pt;text-align:left;">&nbsp;</p>
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<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>ex_102094.htm
<DESCRIPTION>EXHIBIT 99.2
<TEXT>
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<p style="text-align: right; margin-top: 0px; margin-bottom: 0px;"><font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>Exhibit 99.2</b></font></p>

<p style="text-align: left; margin-top: 0px; margin-bottom: 0px;"><font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</font></p>

<p style="margin: 0pt; text-align: center; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>LRAD</b></p>

<p style="margin: 0pt; text-align: center; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>December 13, 2017</b></p>

<p style="margin: 0pt; text-align: center; font-family: Times New Roman, Times, serif; font-size: 10pt;"><b>11:17 a.m. EST</b></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OP<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">ERATOR: This is Conference #121317LRAD</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Good day, ladies and gentlemen and welcome to LRAD Corporation fiscal year 2017. All lines have been place on a listen only mode and the floor will be open for questions and comments following the presentation. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">If you should require assistance throughout the conference, please press &ldquo;star&rdquo; &ldquo;0&rdquo; on your telephone keypad to reach a live operator.<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> At this time, it is my pleasure to turn the floor over to your host, Brian Harvey. Sir, the floor is yours.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">BRIAN HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you, Kat (ph). Good afternoon, everyone and welcome to LRAD Corporations fiscal year 2017 financial results conference call. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">I<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;m Brian Harvey Director of Investor Relations and Capitol Markets for LRAD. On the call with me this afternoon are Dennis Klahn, LRAD&rsquo;s Chief Financial Officer and LRAD&rsquo;s Chief Executive Officer, Richard Danforth.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">In just a moment, Mr. Klahn will open today<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s call with a recap of our fiscal fourth quarter and 2017 financial results. Mr. Danforth will then provide an update on our business. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Afterward, we will open the call to questions but before I turn the call over to Dennis, I would like to take this opportunity to remind you that during the course of this call, management will make forward looking statements.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Other than statements as to historical fact, statements during this call that are forward looking statements are based on our current expectations.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">During this call, we may discuss the company<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s plans, expectations, outlook or forecast for future performance. These forward looking statements are subject to risk and uncertainties and actually results could different materially form the views expressed today.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">For more information regarding potential risk and uncertainties, please see the risk factor section of the company<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s form 10k for the fiscal year ended September 30th 2017. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">LRAD Corporation disclaims any intent or obligation to update those forward looking statements except as otherwise specifically stated. I would now like to turn the call over to LRAD<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s Chief Executive Officer, Richard Danforth.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<div id="PGBK" style="width: 100%; margin-right: 0pt; margin-left: 0pt;">
<div id="PGNUM" style="width: 100%; text-align: center;">&nbsp;</div>

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<div id="PGHDR" style="width: 100%; text-align: left;">&nbsp;</div>
</div>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">RICHARD DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you. At our conference call last august, I introduced Dennis Klahn as our interim CFO, in early September, Dennis accepter a permanent position here at LRAD as its new CEO &ndash; CFO, excuse me.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Dennis bring a plethora of experience in small and large companies both public and private but predominantly public. He<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s been under a great deal of activity since he&rsquo;s joined us and has done a terrific job, we&rsquo;re all glad to him. So with that introduction, Dennis.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DENNIS KLAHN<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you, Richard. LRAD Corporations finished fiscal year 2017 with fourth quarter revenue of 7.5 million, a 53 percent increase for the 4.9 million in the fourth quarter of 2016. Gross profit for the quarter was 4.4 million or 58.8 percent of net revenues. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">This compares to 2.3 million or 47 percent of net revenues for the fourth quarter of 2016.<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Operating expenses in the quarter increased by 53.4 percent from 2.2 million in the fourth fiscal quarter of 2016 to 3.3 million in the fourth quarter fiscal 2017. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">This primarily due to high incentive expense this year, higher commission expense related to increased sales in the period. Expense associated with the implementation of a new ERP system and increased sales and marketing activity.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">The company reported net income of 166,000 or just under a penny per share for the fourth fiscal quarter in <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;17 compared to a net loss of 514,000 or two cents per share for the fourth fiscal quarter of the prior year. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Revenues for the fiscal year ended September 30 2017 were 20.3 million, a 24 percent increase over 16.4 million in the fiscal year ended September 30 2016.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Gross profit for the year ended September 30 2017 was 10.3 million or 50.6 percent of debt revenues compared to 7.7 million or 46.9 percent of net revenues for the same period in the prior year. The increase was primarily due to the higher 2017 revenue. Operating expenses for the year ended September 30, 2017 increased 19.7 fro 9.3 million to 11.1 million.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">This increase was primarily due to an increase in the crude incentive compensation based upon attainment of certain financial goal. In increase in non cash compensation, investments in sales and engineering personnel and expenses related to the implementation of the new ERP system.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Year to date, the company reported a net loss of 877,000, or three cents per share, compared to a net loss of 1.3 million, or four cents per share, in the prior year. They recorded income tax expense of 198,000 in fiscal 2017, primarily due to a change in the deferred tax assets, compared to income tax benefit of 186,000 in the prior year.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<div id="PGBK" style="width: 100%; margin-right: 0pt; margin-left: 0pt;">
<div id="PGNUM" style="width: 100%; text-align: center;">&nbsp;</div>

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</div>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Our balance sheet continues to be strong. Our cash and cash equivalence, as of September 30, 2017, were 12.8 million compared to 13.5 million at the end of the prior fiscal year.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">The <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">$700,000 decrease in cash and cash equivalence was primarily due to an increase in inventory in accounts receivable, as result of the higher shipment in this year&rsquo;s fourth quarter. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Working capital increased by 2.3 million, from 23.1 million at September 30, 2016, to 25.4 million at the end of September 30, 2017. Primarily due to the movement of 1.5 million of long term marketable securities into short term securities, plus the increase revenues in 2017.</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">In fiscal 2017, we did not repurchase any shares of our stock; however, the share repurchase program has been extended through December 31, 2018. With that, I would like to turn the call back over to <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">Richard.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thank you, Dennis. And good afternoon, everybody. We finished fiscal year 17 with a strong fourth quarter, our bookings for the quarter, were 12.5 million and totaled 28.4 million for the fiscal year. That&rsquo;s a record for (LRAD), 195 percent increase over the prior fiscal year, and more than the previous two years combined. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">This increase was led by <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">North America achieving 16.5 million of bookings, up 166 percent over fiscal year 2016. In FY17 we received our largest domestic order a $6 million U.S. Army order. This order was for more that two times it was originally budgeted for the Army to buy in FY17. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Half of this order is for a product that incorporates recent customer requested changes and is expected to deliver in our fiscal second quarter.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">The increase and the customer requested changes, plus the Army&#39;s completion of the operations and maintenance manuals, logistics and (spares) provisioning further demonstrates the Army&#39;s commitment to LRAD.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">New customers accounted for $10 billion of our $28.4 million in bookings. Mass notification bookings were exceptionally strong, increasing to $8.7 million from $1.6 million fiscal year 2016. Of note, most of the mass notification bookings in fiscal <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&lsquo;17 came from the channels originally developed to support the acoustic handling device sales.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Our revenues for the quarter were $7.5 million 53 percent increase from the same quarter a year ago and $20.3 million for the year. As Dennis said, a 24 percent increase from the prior year.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">We ended FY17 with a backlog that is orders to be delivered in FY18 of $11.9 million versus $3.1 million in FY16 over a 300 percent increase. Gross margins for fiscal Q4 was 58.8 percent, up from 47 percent the same period a year ago.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">For the fiscal year gross margin was 50.6 percent up 46.9 percent in fiscal 2016. Operating income and operating cash for fiscal <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&lsquo;17 improved to 54 percent and 42 percent respectively as compared to fiscal 2016.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Q4 operating income was $1.1 million compared FY16 Q4 of $163,000. For the year the operating loss was $808,000 compared to an operating loss of nearly $1.6 million for FY16. Cash at September 30 and equivalents $12.8 million.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">After having a positive operating cash flow for most of FY17 in Q4, we headed with the use of $677,000 of cash.<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Our receivables were up $2.3 million from the same period a year ago, reflecting the significant shipments of orders near the end of the fiscal year. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">In addition to receiving our largest domestic and National Guard orders to date in fiscal Q4 we received several mass notification orders that included mobile military systems, college campuses, installations and satellite activated system for hydroelectric plant.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Our acoustic handling device order for the U.S. Navy and for public safety in <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">Southeast Asia were also received. We expanded our mass notification product line in fiscal Q4 introducing the LRAD 360 XL and the LRAD SoundSaber-X. Orders for both of those systems have already been received.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">In FY17 we booked $10 million from new LRAD customers $8.7 million in mass notification orders. Realize bookings growth in all geographic sales region in our pipeline increased by 30 percent.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">We are making good progress and are growing and diversifying our customer base and our product offering. In fiscal <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;18, we expect the U.S. Army to release an RFP for a multiyear program. This award is of course dependent on approved FY18 Defense Appropriation bill. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">We are continuing to pursue global market opportunities for acoustic handling devices and mass notification systems with the support of our expanded sales team in the 17 new domestic and international resellers added to our self network last year. Increasing and strengthening partnership and pursuing acquisitions to broaden our product line are among our fiscal 2018 business priorities.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Based on the strong bookings trend the significant growth of our addressable backlog and our recent order announcements we<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;re up for strong start fiscal year 2018 and positioned for growth in fiscal 2018. With that I&rsquo;ll turn it back to Brian for Q&amp;A.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you Richard. (Cat), we&rsquo;d now like to open up the conference call to questions. We encourage callers with questions to queue up with the operator as soon as possible so that there will be minimal lag time between each caller. (Cat), please instruct the callers how to queue up with the questions. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Certainly. Thank you. The floor is now open for questions. If you do have a question, he may press star one on your telephone keypad at this time. If your question has been answered you can remove yourself from the queue by pressing one. And our first question comes from Josh Nichols from B.Riley FBR. Go ahead, Josh.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">JOSH NICHOLS<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Yes, thanks for taking my question. I was wondering, seems like the business is on a good track here. Could you talk a little bit about the direction you see the company moving longer-term as we look over the next say 12 to 24 months?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Sure. As I mentioned my remarks, Josh, our backlog is very healthy going into &rsquo;18 to support the next 12 months of sales. The growth we&rsquo;ve experienced in bookings particularly in the mass notification area is very encouraging. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">As I said, we booked $8.7 million in 2018. That<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s up from $1.5 million in 2016. So, we expect a mass notifications continue to grow, expect to continue to grow our acoustic handling device bookings and sales as well.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">NICHOLS:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes. And then, just looking here, when does the &ndash; just for housekeeping, when does the K going to be out, I guess?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Should be within the next day.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">NICHOLS:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. And, you talked a little bit about some of the new resellers that you have. Could you give a little bit more color and maybe quantifies some the specific areas of additional investments in like engineering regarding the acoustic handling devices and mass notification? The company&#39;s maiden attraction that you&rsquo;re see now that they&rsquo;re ramped up a little bit more.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes, so first (closer) to the resellers and the sales network. We added three direct sales people in 2017 and we added 17 resellers. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">The majority of those or 12 of those were in North American and then five outside the <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">U.S. It&rsquo;s takes a bit on time for them to spool up but they all have a pipeline that they&rsquo;re pursuing and we expect good things from them.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">In terms of the design activities that occurred during fiscal year <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;17, we, through the course of the year announced I think it was eight new acoustic handling device products in two or three system &ndash; mass notification system products. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">All of which have been -- all of which are products and systems that we have taken orders for in 2018 <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&ndash; in 2017. I expect that level of activity and new product development to continue through 2018 and beyond. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">NICHOLS:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thank you. That&rsquo;s it I&rsquo;ll hop back in the queue.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you, Josh. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> And, our next question comes from Greg Weaver from Invicta. Go ahead, Greg.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">GREG WEAVER<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Nice job, guys. Could you give me a little color on how we&rsquo;re looking for the fiscal first quarter here given that we&rsquo;re almost done in terms of bookings activity? </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> That&rsquo;s a tough one. We don&rsquo;t give out guidance, so.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. Are you booking &ndash; are you more focused on fiscal Q2 at this point in terms of booking business?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> No, we still have two weeks left in fiscal Q1 and we still have more to do but I don&rsquo;t think anybody will be disappointed.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> All right. Excellent gross margins that you just reported for the fiscal Q4 (here). Any detail on what drove that? I mean is it a one time thing or just some efficiency?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> No, the gross margins are &ndash; have improved quarter over quarter through 2017. Obviously Q4 had a larger revenue base so more base when through the factories which helps all most constant result in gross margin. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">But in addition to that we<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;ve been very pleased with the gross margins we&rsquo;ve been achieving with the mass notification product line. We did expect to see that more depressed than the actuals, in fact the actuals are coming in quite strong. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. That&rsquo;s good news given the growth you&rsquo;re talking about there. So, if we see a bigger mix of mass notification that&rsquo;s overall creative to the gross margin for the business?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> The more revenue the better the gross margin, Greg. So, it &ndash; again I - -from a directionality perspective if you look at the executable backlog for a period of time where we&rsquo;ll let everybody know what the bookings were in Q1 and we&rsquo;re off to a terrific start.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> All right. What was the split between the mass notification revenues and you said on bookings you gave me this but not revenues and acoustic handling?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes. I don&rsquo;t have that unless, Dennis, do you have that handy?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">KLAHN:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> I don&rsquo;t have the number in front of me.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> I will say, Greg, that it&rsquo;s &ndash; the bookings is going to follow &ndash; the revenue will follow the bookings precisely. So, bookings for mass notification 8.7 of the 23.4.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes. OK. I&rsquo;ll use that as a rough benchmark. So the backlog that you gave us at the end of September I assume all that&rsquo;s shipping in the current fiscal?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes. That&rsquo;s a definite. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">KLAHN:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> In the fiscal year. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> What&rsquo;s the question again? Let me make sure I &hellip;</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes, the current fiscal year. Yes.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Fiscal year, yes.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes, yes.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Not on Q1. Only half.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Only half, right.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> So, I&rsquo;ll take another whack at it. So, in terms of fiscal &rsquo;18 nice growth but fiscal &rsquo;17 there was a little over 20 percent, I mean, is it unrealistic that you can&rsquo;t at least be on that same trajectory and let all these good things we&rsquo;ve talked about and the backlogs up 300 percent?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> I&rsquo;d say connect the dots and you&rsquo;ll get that answer.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Oh, man. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Right on.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> You&rsquo;re tough. All right. I&rsquo;ll try to plain -- one more plain Jane here. How about on the inventory terms, any objective there or have you built it up in anticipation of revenue ramp or it seems a little &hellip;</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Well, the inventory net went up approximately $400,000 for the year. And, I can point to nearly $2 million in finished goods that almost made it into revenue but didn&rsquo;t make it into revenue in Q4. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">So, I think our practices and as you heard earlier we went live with a new ERP system which is certainly a tool to help in material management. I think we<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;ll continue to see improvements there. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. Thank you very much. Good job. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thank you.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you, Greg.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> And, our next question comes from Robert Smith from Center for Performance. Go ahead, Robert.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">ROBERT SMITH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Hi, thanks for taking my question. The order that you mentioned about being dependant upon the defense budget being approved can you give us some parameters or what is the opportunity there?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> We&rsquo;ve mentioned this before, Robert, but it&rsquo;s a multiyear procurement for AHDs for the U.S. Army. It will cover FY18 through FY22. It will be a competition. However, we&rsquo;re in a terrific position to win that competition but we must win it. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">And as I said in my remarks we expect the government to put that order under contract in this fiscal year. But it is dependant on the budget being passed and some of the vagaries out of D.C.</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">SMITH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> And, it&rsquo;s size?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> It &ndash; I won&rsquo;t know that precisely until we see it but it&rsquo;s size is intended to fulfill a requirement that is for between 800 and 3,500 units. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: And Robert, we don&rsquo;t want to get into too much pricing on that right now because we know some of our competition is listening to this call and we don&rsquo;t want to give them an idea of what we might be bidding. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">SMITH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> (Agreed). OK, I appreciate that. Thanks and good luck.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you. And we&rsquo;ll take the next.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Sorry. And the next question comes from Adolf Herst from First Princeton Asset.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">ADOLF HERST<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Good afternoon. I wondered if you could you give me an idea of the size of the market of the products you currently have. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Well, that&rsquo;s somewhat of a debatable item. So, mass notification, this public information available that will size the market in the billions with a double-digit (kicker). </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">So even if they<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;re wrong by 50 percent, it&rsquo;s still a substantial market for LRAD to continue to grow into the acoustic ailing device market. LRAD enjoys a position there that would suggest that the more products and the more people we can put on it, the more market we will generate. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Anther question, the sales are obviously ramping up. What&rsquo;s your ability without -- in your cost of -- can you deliver a lot, is the bottom line? </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Sure. Our labor content &ndash; our products and systems is relatively small, so our ability to ramp up is first and foremost, a material management issue and then to the labor. So space is a constraint here in this facility, the lease is running out. We will likely move to a larger facility to support the anticipated growth. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Do they cost a lot? </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Everything costs, Adolf. Nothing is free. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. Also, let&rsquo;s talk about your competition. Is there new competition in the market? How severe is it and how much are you ahead of them, if at all?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Well, the competitive landscape hasn&rsquo;t changed. It&rsquo;s dramatically different in the two markets we serve. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> and there&#39;s been no change to that since our last call or in the recent past.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. I want to thank you. This last quarter is very encouraging and I hope it continues. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thank you.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you, Adolf, we appreciate it.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Our next question comes from Steve Wagner of Wagner Financial. Go ahead, Steve.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">STEVE WAGNER<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Hey, good afternoon, gentlemen. Great job in the quarter. Hey, a couple questions; 7.5 million in revenue in the final quarter but it only a penny. I know you mentioned an inner source resource planning the software package. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Was that the reason for it<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">? Was it some other accounting issue, were they non-cash charges, can you elaborate on why it wasn&rsquo;t more than a penny in terms of profitability? </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">KLAHN:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> The biggest challenge was the tax expense in the fourth quarter. Year to date through June through nine months of operations, we recorded a tax benefit and at the end of the day when we (threw up) the tax accrual, there was actually tax expanse of 197. So tax expense was $951,000 in the quarter.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Yes, Steve, prior to that tax expense, we generated over $1.1 million of operating income, but because of what Dennis just discussed, it was a $950,000 charge of tax.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WAGNER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. Going forward is that -- again I&rsquo;m not a CPA accountant, so apologize for the naivete, perhaps from the question, but it just seems like with that kind of revenue, we should have better earnings. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">I mean, is this something that<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s going to continue in terms of what you have to report deferred taxes? I thought we had a significant tax loss carry forward ? </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Maybe just <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">briefly clear that up for me. Help me understand that from an accounting standpoint, why would you need to accrue for taxes when you&rsquo;ve got a big carry forward that perhaps could be used? </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">KLAHN:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Sure, no problem. Deferred taxes are a challenge for probably 105 percent of the population. It&rsquo;s an asset on put book at the present time. At the end of September, its $8.3 million. So we will continue to report income tax expense, however, it will not be in cash charge. It will be only used&hellip;</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WAGNER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">KLAHN:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> &hellip;to reduce that tax asset. It should be much, much smaller amount compared to income on a going-forward basis. This was really, we had been taking, adding to that tax asset in prior quarters and, as we look at it now, that most likely will not happen again going forward.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WAGNER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. Excellent because X that out, wouldn&rsquo;t, I mean just a quick calculation in my head, I mean we would have probably been able to report roughly $0.04 per share, right?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> I&rsquo;ve not done the math, but&hellip;</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WAGNER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> &hellip;that certainly would have been (inaudible). </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WAGNER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> But it sounds like what it should be. And then one other question for you guys, and then again, look, I think we&rsquo;re all elated not so much with the EPS, but more importantly the revenue. That&rsquo;s what the story is all about right now. And that&rsquo;s just remarkable as is the kickoff to next year. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">The other question, Richard for you would be, you know, in, in past calls you<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;ve talked about one of your goals being in acquisition. Can you give any indication or any idea on where you are in the stream of things there?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Steve, yes. In the, in the prepared remarks, I told you that one of our business priorities for &rsquo;18 is, will continue to be the pursuit of acquisitions and we have been active in that since I got here and as soon as we close one we will let you know.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WAGNER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> High on my priority list.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WAGNER:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Excellent. I for one feel we move to a much larger facility can only be viewed as amazingly great news. So, you know, good luck on that move and obviously on what you&rsquo;re doing. You guys are doing a great job and thank you so much for all your hard work.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thank you.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thanks Steve, appreciate it.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> And that appears to be the last question.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Well if you want to poll one more time and if no one else is there, we&rsquo;ll wrap it up. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Sure, again ladies and gentlemen, it&rsquo;s star one. And someone did pop in there. Lloyd Corden (ph) from Unique Investments. Go ahead Lloyd (ph).</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">LLOYD CORDEN (ph<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">): OK thank you. Hello guys.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;"><font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH: Hi there.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Good afternoon Lloyd (ph).</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">CORDEN (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes, I did pound in earlier but I guess it didn&rsquo;t go through. Maybe I was too quick. But anyway, certainly glad to see the increase in revenue and new customers and orders and thank you guys for the efforts that it takes to accomplish what you have accomplished. What&rsquo;s going on with Homeland Security National Guard? Can you fill me in a little bit on our potential and where we are?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Sure, so National Guard, we received the largest National Guard order LRAD has ever received in Q4. And we put a public release announcement out. It happened to be a brand new mass notification system, in keeping with the theme with designing and selling very quickly. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">The --<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> we will see additional orders for the National Guard this year, and just stand by for the press releases. In terms of DHS, Homeland Security, we actually did book our first order for DHS, it was a small order but it was a start. Remember the DHS&rsquo;s budget isn&rsquo;t the same circumstances the rest of the DOD. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">So we<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;ll see what 2018 brings for them but it will be much more robust than it&rsquo;s been in &rsquo;16 and whether there&rsquo;s a wall or not a wall I don&rsquo;t know yet. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">But we<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;re active, active with most of the (wall) manufacturers and we&rsquo;re active with the prime contractor that has the virtual wall contract for the Southern part of the United States, so. There&rsquo;s a lot of pots in the fire so I think we&rsquo;ll see more and more bookings and revenue from that area in 2018.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">CORDEN (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> What&rsquo;s happening with Japan? I know we&rsquo;ve been doing a lot of business with them. Is that continuing and&hellip;</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: It is. One of our other products were released this year, the (inaudible), I announced in my remarks. We took an order for over 100 of the tsunami warning and mass notification in Japan. </font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">In fact our direct sales guy is in <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">Japan this week. The orders in &rsquo;17 were sort of consistent with what we did in &rsquo;16 but we expect more in the near future especially with the new product that we&rsquo;ve introduced in the country.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: And Lloyd (ph) just by way of understanding that product a little, for now what we&rsquo;ve been generally selling into Japan is the speakers that go on top of buildings or on top of poles. Japan also, for each speaker that&rsquo;s on top of a building or a pole, has tens, dozens of additional (line array) speakers that we are now beginning to sell.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">So rather than just have that one that<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s on top of the building, we&rsquo;ll be able to sell &ndash; expand our product offering within that. So we think it&rsquo;s actually a very exciting opportunity for us, and that&rsquo;s why &ndash; one of the reasons we developed the Sound Saber.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">CORDEN (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> That&rsquo;s great, exciting, and also, what&rsquo;s going on with China?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> China continues to move along, we announced &ndash; I think we announced an order in Q1 for &ndash; no? No. So China continues to move along, and&hellip;</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">CORDEN (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Does that mean there&rsquo;s a China order coming?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> No, no, if there was any one of any significance, we would have put a press release out. We don&rsquo;t put releases out on everything but the significant ones we do.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">CORDEN (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Well, it&rsquo;s nice to see the new orders coming in sent from new people, and thank you for all your efforts and for the growth and continued and a great 2018, we hope, thank you.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you very much.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thanks, Lloyd (ph).</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> And our next question comes from Paul O&rsquo;Keefe (ph) from Edge (ph), go ahead Paul (ph).</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">PAUL O<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;KEEFE (ph): Hello you guys, thanks, great job, (Lloyd) took all my questions.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> We&rsquo;re happy to repeat them, they were good questions.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">O<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;KEEFE (ph): I tried to press &ldquo;star&rdquo; &ldquo;9&rdquo; or something, but great quarter, great year, thanks for all your help.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Oh, you&rsquo;re welcome.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you, thanks Paul (ph).</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">O<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;KEEFE (ph): I don&rsquo;t know how to get off of this.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Kat (ph) will boot you off in a second.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK, sorry, and Addal Herst (ph) has another question. Go ahead Addal (ph).</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">ADDAL HERST (ph)<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Yes, I wonder if you could expand on talking about your competition a little bit, send new people into the market, is it extensive or &ndash; and are they &ndash; are big companies?</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes, they&rsquo;re all of the above. There&rsquo;s large publicly traded companies, there&rsquo;s small companies, there&rsquo;s companies in the United States, there&rsquo;s companies in Europe and elsewhere. So I &ndash; it&rsquo;s the robust field of competitors in the marketplace.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Especially when it comes to the mass notification space, because that&rsquo;s &ndash; we are a new (entrant) &ndash; we&rsquo;re entering with a better product that&rsquo;s starting to gain a little traction, whether it&rsquo;s college campuses, critical infrastructure facility, as we&rsquo;re doing with the international guard that we announced, mass notification for the international guard.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">So that<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s a more highly competitive space, but as far as the (acoustic haling) device market, there are a few competitors, they&rsquo;re smaller than us generally, or at least the divisions of the companies that are competing against us are much smaller.</font></p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">And one of the advantages we think we have in that, and you<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;ve seen throughout the year we announced our largest national guard order ever.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">We announced our largest army order ever, we<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;re continuing to work with the navy and expanding programs with some of their fleet, and we&rsquo;re continuing to work with the marines, which we announced.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">So within the U.S. military, we still dominate the market, and that<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;s the gold standard worldwide for (acoustic haling) devices. So while there is some smaller competition out there, and they do listen to our calls, we believe we continue to offer the best value proposition and then most importantly, the best product.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">And so, while we see them in the (ac<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">oustic haling) device market, we&rsquo;re not too worried about them, but mass notification is a much more expansive set of competitors, but we still believe we&rsquo;re competing with the best product.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> You protect some of this, or can you, with patents?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Yes, we have patents and company proprietary software and designs.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Right. OK. You&rsquo;re spending much money with your R&amp;D?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Yes.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> (Raising) that up?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: We are, and we&rsquo;re &ndash; that was part of the expenses of this year was investments in engineering and R&amp;D to produce the new products, and a large percentage of our new products &ndash; new products made up a large percentage of our revenues this year.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">So we<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">&rsquo;re very excited about that. New customers and new products came into the &ndash; into LRAD this year, and we&rsquo;re excited about both of those.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> And the products that you&rsquo;re producing, are you outsourcing a certain percentage of them, or &ndash; how much of it is done in house?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: As I mentioned a moment ago, the labor content for our products is relatively small, so it&rsquo;s a material management issue first and foremost.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> But is assembly done outside &ndash; so it is done outside.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> No, no, no, no, we do all the assembly in San Diego.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">KLAHN:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> It&rsquo;s done here.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HERST (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK. Thank you.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you, Addal (ph). Kat (ph), next.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes, our next questions come from David Lubech (ph) from Summit Brokerage. Go ahead, David (ph).</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DAVID LUBECH (ph<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">): Hello, hello, thanks for taking the call. Going in the backlog, I think you said 11.9 million at the end of September?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">LUBECH (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Is that correct? Can you update that, maybe the end of November?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: No, I&rsquo;d have to do it too quickly, so our backlog continues to remain strong.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">LUBECH (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: We&rsquo;ll finish this quarter in two weeks and you&rsquo;ll what precisely it is.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">LUBECH (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK, thank you.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> And our next question comes from Greg Weaver (ph) from Invicta (ph), go ahead Greg (ph).</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">GREG WEAVER (ph)<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Yes, thanks, I thought you were going to answer that. I was going to be offended. The go &ndash; can you get a little color on the go to market and fiscal &rsquo;18? We talked a while back about how you were cleaning the channel out, so and so forth, is there any priorities here in terms of changes made, et cetera?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Yes, Greg (ph), there are. When &ndash; I forget where it was we last met &ndash; but I&rsquo;m sure I told you that we had an active program to refresh and change out and add to our (resell the) network, and to that end in North America we doubled the amount of resellers that we had in the past, and swapped out some of the lower performing ones as well.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">Outside the <font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">United States, we&rsquo;ve added five new ones, and I think Greg (ph), you&rsquo;ll see that program continue.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Could we tweak the sales comp plan at all to &ndash; I don&rsquo;t know that you&rsquo;re trying to prioritize certain products, or shuffled in terms of territories versus direct (inaudible).</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: No, the sales comp plan is heavily &ndash; almost entirely weighted, frankly, on &ndash; no entirely weighted on bookings, and based on the $28 million bookings year, again one point of curve does not make a trend. But results are very, very good from a bookings perspective.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

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<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">WEAVER (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> OK, thank you much. Good luck. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Thank you.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> And our next question comes from Robert Smith (ph) from Performance (ph), go ahead.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">ROBERT SMITH (ph)<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Yes, (Center for Performance Investing). So I just want to congratulate you on a very upbeat nature of this call, it&rsquo;s been wonderful to hear, and I also want to say kudos to the gal that&rsquo;s been shepherding the callers, because she&rsquo;s done a bang up job.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thanks, Robert (ph), thank you.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> The next question comes from Bob Stone (ph) from Investor (ph), go ahead Bob (ph).</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">BOB STONE (ph)<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Hello, congratulations, it&rsquo;s been great news today. I just have two simple questions, I don&rsquo;t know what an ERP is.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: An ERP is an Enterprise Resource Planning, it&rsquo;s a software tool to run your business from receipt of order to collection of cash.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">STONE (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thank you, the other is labor versus material management, I don&rsquo;t know what material management &ndash; is that your raw materials?</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> So if you look at a typical (elret) product to a system, if it costs 100 &ndash; anything, $100, approximately 85 percent of those &ndash; or 85 cents of that dollar will be bought as opposed to manufactured here. So 15 percent does all of the assembly (in test).</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">STONE (ph):<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Well, thank you. </font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">DANFORTH:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> You&rsquo;re welcome.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> That&rsquo;s appearing to be the last question at this time.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: OK, great.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">HARVEY<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;">: Well, everyone, thank you for participating in LRAG corporations fiscal year 2017 conference call. A replay will be available in approximately four hours through the same link issued in our November 28<sup>th</sup> press release, once again, thank you all for participating.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">OPERATOR:<font style="font-family: Times New Roman, Times, serif; font-size: 10pt;"> Thank you, this does conclude today&rsquo;s conference, we thank you for your participation, you may disconnect your lines at this time, and have a wonderful holiday.</font></p>

<p style="margin: 0pt; text-align: left; font-family: Times New Roman, Times, serif; font-size: 10pt;">&nbsp;</p>

<p style="margin: 0pt; text-align: center; font-family: Times New Roman, Times, serif; font-size: 10pt;">END</p>
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end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
