Traditionally, the primary application of Dynamic Random Access Memory, or DRAM, has been desktop PCs, representing 36.5% of DRAM shipments in 2004 according to International Data Corporation, or IDC. However, with the proliferation of new electronic systems and smaller form factors, non-desktop PC applications such as servers, workstations, storage systems, switches, routers, consumer electronics, and other electronic equipment is becoming an increasingly larger portion of the DRAM market. As a result, the non-desktop PC DRAM market is anticipated to grow faster than the overall DRAM market.

This growth is a result of increased implementation of virtualization technologies for storage and servers and continued evolution of tiered storage environments. IDC expects the DRAM memory content used in entry level servers to grow from 3,222 megabytes in 2004 to 11,411 megabytes in 2009, representing a compound annual growth rate of 28.8%, as a result of increased use of 64-bit processors.

The flash market has grown in recent periods as a result of the introduction of new applications and increasingly complex electronics, which has driven the demand for increased amounts of memory. The growth of the demand for memory modules is being driven by original equipment manufacturers, or OEMs. And end users’ increased demand for functionality and higher processing speed. iSuppli estimates that the worldwide DRAM memory module market reached approximately 397 million units in 2004 and is expected to grow to 671 million units in 2009, representing a compound annual growth rate of 11.1%.

The growth in industrial markets is driven by customer requirements to increase functionality, lower power requirements and increase display locations. According to Gartner’s 2005 report entitled “Large TFT-LCD Screens Worldwide 2000-2010,” the TFT-LCD market is expected to grow from $33.3 billion in 2004 to $71.3 billion in 2010, representing a compound annual growth rate of 13.5%.

The Company also accommodates custom module designs based on specific OEM requirements. The Company’s advanced DDR and DDR2 memory modules are designed to operate with high performance devices available through the extensive use of electrical and thermal simulation and modeling.

The Company designs and manufactures flash memory products in a variety of form factors and capacities. The Company’s wide range of flash memory products come in CompactFlash, PC Card, Key Drives, Embedded USB (EUSB), SATA Drives (Serial ATA), Mini IDE Drives, and module form factors that utilize ATA, Linear, IDE, and USB technologies for data and code storage applications.

The Company offers a comprehensive line of single in-line memory modules, or SIMMs, and more current dual in-line memory modules, or DIMMs, and based on multiple flash memory technologies, including 72 Pin DRAM-like SIMMs, 80 Pin synchronous SIMMs, 80 Pin asynchronous SIMMs and 168 Pin synchronous and asynchronous DIMMs. The Company’s flash modules are predominantly used in telecom equipment, printers, embedded controller applications, servers, switches and routers.

The Company provides SRAM based SIMMs, DIMMs and SO-DIMMs for industrial and other applications. The Company’s SRAM modules are used in communication systems, point of sale terminals, electronic verification equipment, industrial instrumentation, medical instruments, disk drives, servers, graphics, and workstations. The Company has engineered its software development tools, eFlashTools and FlashTools, to offers a user-friendly environment in which to update or program linear flash cards in the field or in-house.

The Company offers complex, diversified and high quality embedded computing products for computing, communications and storage applications to OEMs. The Company produces standard and custom products such as PMC, cPCI, and ATCA boards. The Company’s products undergo rigorous pre-production and production testing, including in-house 3D x-ray inspection, in-circuit test and functional testing. The Company also offers extended products life support and Restriction of Hazardous Substances, or RoHS, compliant designs, two critical requirements for the customers and markets it serve.

Gross profit for the fiscal year ended August 31, 2005 was $101.3 million, or a 16.0% increase from $87.0 million for the fiscal year ended August 31, 2004.

Research and development expenses for the fiscal year ended August 31, 2005 were $9.7 million, or a 28% decrease from $13.4 million for the fiscal year ended August 31, 2004.

Selling, general and administrative expenses for the fiscal year ended August 31, 2005 were $49.2 million, substantially unchanged from $48.5 million for 2004.

Net other income for the fiscal year ended August 31, 2005 was $0.5 million compared to net other income of $0.3 million for the fiscal year ended August 31, 2004.