SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

{X}             ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
               THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)

                     For the fiscal year ended June 30, 2006


Commission File Number:  0-13011

                               TNR TECHNICAL, INC.
                     --------------------------------------
             (Exact name of Registrant as specified in its charter)

            New York                                      11-2565202
    (State of jurisdiction of                           (I.R.S. Employer
   incorporation or organization)                    Identification Number)


301 Central Park Drive, Sanford, Florida                          32771
----------------------------------------                   -------------
(Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code:       (407) 321-3011
                                                          --------------

Securities registered pursuant to Section 12(b) of the Act:

                                    None

Securities registered pursuant to Section 12(g) of the Act:

                          Common Stock, $.02 Par Value
                          ----------------------------
                                (Title of Class)

Check whether the Registrant is not required to file reports pursuant to Section
13 of 15(d) of the Exchange Act. [ ]

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

Indicate by check mark if disclosure  of  delinquent  filers in response to Item
405 of Regulation S-B is not contained in this form,  and no disclosure  will be
contained,  to the  best of  Registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in part III of this Form 10-KSB
or any amendment to this Form 10-KSB [ ].

Indicate by check mark whether the  Registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act. Yes [ ] No [X]

State issuer's revenues for its most recent fiscal year: $9,724,432.

As of  September  11,  2006,  the number of shares  held by  non-affiliates  was
approximately  126,000 shares.  The  approximate  market value based on the last
sale  (i.e.  $29.00 per share) of the  Company's  Common  Stock as of the latest
trade  date of  September  11,  2006 held by  non-affiliates  was  approximately
$3,654,000.  The number of shares outstanding of the issuer's Common Stock as of
September 11, 2006 was 259,877.


<PAGE>
                           FORWARD-LOOKING STATEMENTS

     We believe this annual report contains "forward-looking  statements" within
the  meaning of the  Private  Securities  Litigation  Reform Act of 1995.  These
statements are subject to risks and  uncertainties  and are based on the beliefs
and assumptions of our management,  based on information  currently available to
our management.  When we use words such as "believes," "expects," "anticipates,"
"intends," "plans," "estimates,"  "should," "likely" or similar expressions,  we
are  making  forward-looking  statements.   Forward-looking  statements  include
information  concerning our possible or assumed future results of operations set
forth under "Business" and/or "Management's Discussion and Analysis of Financial
Condition and Results of Operations."

     Forward-looking statements are not guarantees of performance.  They involve
risks, uncertainties and assumptions.  Our future results and stockholder values
may differ  materially from those expressed in the  forward-looking  statements.
Many of the factors that will determine  these results and values are beyond our
ability to control  or  predict.  Stockholders  are  cautioned  not to put undue
reliance on any forward-looking  statements.  For those statements, we claim the
protection of the safe harbor for  forward-looking  statements  contained in the
Private  Securities  Litigation  Reform Act of 1995. For a discussion of some of
the  factors  that may cause  actual  results  to differ  materially  from those
suggested  by  the  forward-looking   statements,   please  read  carefully  the
information  under "Risk Factors in Item I". In addition to the Risk Factors and
other important  factors discussed  elsewhere in this annual report,  you should
understand that other risks and uncertainties  and our public  announcements and
filings under the  Securities  Exchange Act of 1934, as amended could affect our
future results and could cause results to differ materially from those suggested
by the forward-looking statements.

                                       2
<PAGE>
                                     PART I

Item 1.  Description of Business
------   -----------------------

General
-------

     TNR Technical,  Inc. (the  "Company") was  incorporated  on October 4, 1979
under the laws of the State of New York.  The  Company  designs,  assembles  and
markets primary and secondary batteries to a variety of industrial markets.  The
Company is an authorized  distributor  for several major battery  manufacturers,
the products of which are distributed  nationally by the Company.  The Company's
business is conducted principally at its two facilities in Sanford,  Florida and
Santa Ana, California.

     The Company is an authorized  distributor of  nickel-cadmium,  nickel metal
hydride,  alkaline,  lithium and sealed lead acid batteries manufactured by Saft
America,  Power-Sonic  Battery,  Varta Battery,  Enersys,  Duracell,  Renata, GP
Direct,  Eveready  Battery,  Kan Industrial  and Sanyo Energy.  As an authorized
distributor,  the Company purchases cells, assembles them into battery packs and
maintains  inventory  for resale.  The Company  sells its battery  cells  and/or
battery packs to the original  equipment  manufacturers and wholesalers  without
geographical  limitation and on a non-exclusive  basis. The Company also designs
and  manufactures  battery  packs to  customers'  specifications.  The Company's
batteries have  applications in mobility,  instrumentation,  laptops,  surveying
equipment,  radio control, alarms, U.P.S., door locks, and emergency lighting as
well as other various consumer products.

     Sales  under   industrial   and   distribution   programs   accounted   for
substantially  all of the Company's  total  revenues  during the Company's  past
three  fiscal  years  and no one  customer  accounted  for  10% or  more  of the
Company's total revenues during these years. For fiscal year ended June 30, 2006
and the eleven  months  ended June 30,  2005,  the  Company  had no  significant
backlog.

Competition
-----------

     There are numerous companies producing and marketing batteries that compete
with  those  sold  by  the  Company,   including   larger   companies,   battery
manufacturers and companies with a wider range of products and greater financial
and technical  resources than the Company.  Smaller start-up  companies are also
entering the industry that purchase directly from offshore battery manufacturers
and distributors, selling into the marketplace via web-based type operations. It
should  be  noted  that  the  Company's   products  and  proposed  products  are
technological in nature and that modern  technology  often  progresses  rapidly.
Accordingly, the Company's present and proposed products are subject to the risk
of obsolescence because of technological innovation by competitors.

Employees
---------

     At August 31,  2006,  the Company  leases from a  non-affiliated  party its
staff  which   includes   twenty-three   persons.   Such  staff  includes  eight
salespersons   (including   two  executive   officers),   two   accounting   and
administrative  staff,  four warehouse and shipping  clerks and nine  production
workers.  For a fee which is paid by the Company,  the leasing company  provides
the payroll,  401(k) plan, worker's compensation insurance and health insurance.
The  Company's  agreement  with the leasing  company can be  terminated on short
notice at any time by the Company.

                                       3
<PAGE>
Risk Factors

The  following  risks and  uncertainties,  as well as others  described  in this
Annual  Report on Form 10-KSB could  materially  adversely  affect our business,
results of operations and financial  conditions.  Security holders are cautioned
that these and other  factors may affect  future  performance  and cause  actual
results to differ from those which may, from time to time, be  anticipated.  See
Forward Looking Statements under Item 6.

We operate in an  extremely  competitive  industry  and are subject to continual
pricing pressure.

We compete with a number of battery manufacturers and distributors, as well as a
large  number of smaller,  regional  competitors  and are  therefore  subject to
continual  and  significant  pricing  pressures.  These pricing  pressures  have
prevented us from fully passing through to customers  increased costs related to
increased pricing of raw materials associated with the manufacture of batteries,
such as nickel and lead,  and the  increased  cost of freight for  incoming  and
outgoing  product  due to fuel  surcharges.  We  expect  heightened  competitive
pricing  pressure as Chinese  manufacturers  expand  their  export  capacity and
increase their  marketing  presence in our markets.  Our ability to maintain and
improve our  operating  margins has depended,  and  continues to depend,  on our
ability to control  and reduce our costs.  We cannot  assure you that we will be
able to  continue to reduce our  operating  expenses,  to raise or maintain  our
prices  or  increase  our unit  volume,  in order to  maintain  or  improve  our
operating results.

The failure of critical  computer  systems could seriously  affect our sales and
operations.

We operate a number of critical  computer systems that can fail for a variety of
reasons.  If  such a  failure  were  to  occur,  then  we may  not  be  able  to
sufficiently  recover  from the  failure  in time to  avoid  the loss of data or
adversely  impact certain of our operations  that are dependent on such systems.
This could result in lost sales and the inefficient  operation of our facilities
for the duration of such a failure.

Terrorist  acts  or  acts  of  war  could  cause  damage  or  disruption  to our
operations.

Whether in the United  States or abroad,  war or acts of  terrorism  could cause
damage or disruption to our  operations,  our  suppliers,  channels to market or
customers,  or could cause costs to  increase,  or create  political or economic
instability, any of which could have a material adverse effect on our business.

We are  dependent  upon  our  vendors  for the  manufacture  and  supply  of our
products.

Our  performance  depends on our ability to purchase our products in  sufficient
quantities at competitive prices and on our vendors' ability to make and deliver
high quality products in a cost effective,  timely manner.  We have no long-term
purchase contracts or other contracts that provide continued supply,  pricing or
access to new products and any vendor or distributor could  discontinue  selling
to us at any time.  There can be no  assurance  that we will be able to  acquire
products we require in sufficient  quantities or on terms that are acceptable to
us in the future and there can be no  assurance  that our vendors  will make and
deliver high quality products in a cost effective,  timely manner.  In addition,
all  products  we purchase  from  vendors in the Far East must be shipped to our
warehouse by freight carriers and there can be no assurance that we will be able
to obtain  sufficient  capacity at  favorable  rates.  Our  inability to acquire
suitable products in a cost effective,  timely manner or the loss of one or more
key vendors or freight carriers could have a negative impact on our business.

We are dependent on certain key executives.

Our success  depends to a  significant  extent upon the  abilities of our senior
management.  The  loss  of the  services  of any of the  members  of our  senior
management or of certain other key  employees  could have a significant  adverse
effect on our  business.  In  addition,  our  performance  will  depend upon our
ability to attract and retain qualified  management and sales  personnel.  There
can be no  assurance  that the members of our existing  management  team will be
able to manage the  Company or our growth or that we will be able to attract and
hire additional qualified personnel as needed in the future.


                                       4
<PAGE>
If we are sued on a product  liability claim, our insurance  policies may not be
sufficient.

Although we maintain general  liability  insurance,  our insurance may not cover
all  potential  types of  product  liability  claims to which  distributors  for
manufacturers  are  exposed  or may  not be  adequate  to  indemnify  us for all
liability  that may be imposed.  Any imposition of liability that is not covered
by insurance or is in excess of our insurance coverage could harm our business.

Many of the products we sell are  manufactured  in China; we face risks if China
loses normal trade relations status with the United States.

As a result of  opposition  of certain  policies of the Chinese  government  and
China's growing trade  surpluses with the United States,  there has been, and in
the future may be,  opposition to the extension of Normal Trade Relations status
for China, the loss of which could result in an adverse affect on our business.

Our operations could be materially interrupted, and we may suffer a large amount
of  loss,  in the  case of fire,  casualty  or  theft at one of our  warehousing
facilities.

In the event of material damage to, or loss of, the warehousing facilities where
our products are located due to fire, casualty,  theft, severe weather, flood or
other  similar  causes,  we would be forced to replace  any assets lost in those
disasters within the limits of our insurance.  Additionally, any interruption in
operations at one of our major suppliers as a result of fire,  casualty,  theft,
severe  weather,  flood or other similar  causes could cause a disruption in the
availability of product and/or an increase in product cost.

Laws  regulating  the  transportation  of batteries  may be enacted  which could
result in the  imposition of additional  costs that could harm our ability to be
profitable.

The  transportation  of certain  batteries is regulated  both  domestically  and
internationally.  Under recently revised United Nations  recommendations  and as
adopted by the  International  Air Transport  Association,  certain  chemistries
require a Class 9 designation  for  transportation.  The revised  United Nations
recommendations  are  not  United  States  law  until  such  time  as  they  are
incorporated   into  the  Department  of   Transportation   Hazardous   Material
Regulations.  At  present  it is not known if or when the  proposed  regulations
would be adopted by the United States.  Future  Department of  Transportation or
International  Air Transport  Association  regulations or  enforcement  policies
could impose costly transportation requirements.

We cannot  predict  our  future  capital  needs and we may not be able to secure
additional financing if needed.

We have planned for an increase in sales and, if we  experience  sales in excess
of our plan,  our working  capital needs and capital  expenditures  would likely
increase from that currently  anticipated.  Our ability to meet this  additional
customer demand would depend on our ability to arrange for additional  equity or
debt  financing in the event that cash flow from sales lags behind the increased
working capital requirements.


                                       5
<PAGE>
Risks Relating to an Investment in our Common Stock

Our business is subject to changing regulations relating to corporate governance
and  public  disclosure  that  has  increased  both  our  costs  and the risk of
noncompliance.

Because our common stock is publicly traded, we are subject to certain rules and
regulations of federal,  state and financial  market exchange  entities  charged
with the protection of investors and the oversight of companies whose securities
are publicly  traded.  These entities,  including the Public Company  Accounting
Oversight Board and the Securities and Exchange  Commission have recently issued
new requirements and regulations and continue to develop additional  regulations
and  requirements  in response to recent laws enacted by Congress,  most notably
Section 404 of the  Sarbanes-Oxley Act of 2002. Our efforts to comply with these
new  regulations  have  resulted  in, and are likely to  continue  to result in,
materially  increased  general and  administrative  expenses  and a  significant
diversion  of  management  time  and  attention  from   revenue-generating   and
cost-reduction activities to compliance activities.  Compliance with Section 404
of the  Sarbanes-Oxley  Act of 2002 and the related  regulations  regarding  our
required  assessment  of our internal  controls  over  financial  reporting  and
obtaining an associated independent registered public accounting firm's audit of
that  assessment  will  require the  commitment  of  significant  financial  and
managerial resources. There is no assurance that these efforts will be completed
on a timely and successful basis. Because these laws,  regulations and standards
are subject to varying interpretations, their application in practice may evolve
over time as new  guidance  becomes  available.  This  evolution  may  result in
continuing   uncertainty  regarding  compliance  matters  and  additional  costs
necessitated by ongoing revisions to our disclosure and governance practices. In
the event that our internal controls over financial  reporting are not effective
as defined under Section 404 of the  Sarbanes-Oxley  Act of 2002, there may be a
material  adverse  impact on  investor  perceptions  and a decline in the market
price of our stock.

We lack an  established  trading  market  for our common  stock,  and you may be
unable to sell  your  common  stock at  attractive  prices  or at all.

There is currently a limited and sporadic trading market for our common stock in
the OTC  electronic  bulletin  board  under the symbol  "TNRK."  There can be no
assurances  given that an  established  public  market will be obtained  for our
common  stock or that any public  market  will last.  The  trading  price of the
common stock depends on many factors, including:

     o    The markets for similar securities;

     o    our financial condition, results of operations and prospects;

     o    The  publication of earnings  estimates or other research  reports and
          speculation in the press or investment community;

     o    Changes in our industry and competition; and

     o    general market and economic conditions.

The market price for our common stock may be highly volatile.

                                       6
<PAGE>
The  market  price for our  common  stock may be highly  volatile.  A variety of
factors may have a  significant  impact on the market price of our common stock,
including:

     o    The  publication of earnings  estimates or other research  reports and
          speculation in the press or investment community;

     o    Changes in our industry and competitors;

     o    our financial condition, results of operations and prospects;

     o    any future  issuances of our common stock,  which may include  primary
          offerings   for  cash,   issuances   in   connection   with   business
          acquisitions,  and the grant or exercise of stock options from time to
          time;

     o    Possible payment of dividends;

     o    general market and economic conditions; and

     o    any  outbreak  or  escalation  of  hostilities,  which  could  cause a
          recession or downturn in our economy.

In  addition,  the markets in general can  experience  extreme  price and volume
fluctuations  that  can  be  unrelated  or  disproportionate  to  the  operating
performance of the companies listed or quoted. Broad market and industry factors
may negatively affect the market price of our common stock, regardless of actual
operating performance.

We may not pay cash dividends in the future.

No cash dividends have been paid by our company on our common stock.  The future
payment by us of cash  dividends on our common stock,  if any,  rests within the
discretion of our board of directors and will depend,  among other things,  upon
our earnings,  our capital  requirements and our financial  condition as well as
other  relevant  factors.  We can  provide no  assurances  that we will pay cash
dividends upon our common stock in the future.

Future sales of common stock by management  and other  stockholders  may have an
adverse effect on the then prevailing market price of our common stock.

Future  sales of  restricted  shares of our common  stock made under Rule 144 or
shares of common  stock  that are part of the  public  float may have an adverse
effect on the then prevailing market price, if any, of our common stock.

                                       7
<PAGE>

Item 2.  Description of Properties
------   -------------------------

     The Company's principal executive office, sales,  distribution and assembly
facility is located at 301 Central Park Drive,  Sanford,  Florida  32771.  These
facilities,  which  consist of  approximately  8,000  square feet of space,  are
leased from RKW Holdings  Ltd., a Florida  Limited  Partnership,  controlled  by
Wayne Thaw, an executive officer and director of the Company.  The Florida lease
originally  provided  for a term of ten years  expiring May 31, 2006 with annual
increases  of five  percent  over the  preceding  year's base rent.  The Company
entered into an agreement to extend the current lease for a period of five years
through  May 31, 2011 with a current  monthly  rent of $8,603  (including  sales
taxes),  with annual  increases of 4% over the preceding  year's base rent.  The
Company is also  responsible  for the payment of all  insurance,  property,  and
other taxes related to the leased  facilities.  Property taxes estimated at $780
per month, inclusive of sales taxes, are accrued on a monthly basis.

     The Company also leases from Grove  Investment  Company,  a  non-affiliated
company,  a sales,  distribution and assembly facility at 3400 W. Warner Avenue,
Suites K, L and M, Santa Ana, CA 92704. These facilities consist of 6,480 square
feet of space.  The  California  lease  commenced on July 1, 2000 and expires on
June 30, 2008. The Company currently pays a base rent of $5,832 per month, which
is subject  to  increase  for its share of the  landlord's  increased  operating
expenses. The Company owns production equipment consisting primarily of welding,
soldering,  testing,  pneumatic and material handling equipment,  and inspection
equipment which has been sufficient for its needs to date.

Item 3.  Legal Proceedings
------   -----------------

     There are no material legal proceedings to which the Company is a party.

Item 4.  Submission of Matters to a Vote of Security Holders.
-------  ----------------------------------------------------

     No matters were  submitted to a vote of security  holders during the fourth
quarter of fiscal 2006.



                                       8
<PAGE>

                                     PART II

Item 5.  Market for Registrant's Common Equity, Related Stockholder Matters  and
         Small Business Issuer Purchases of Equity Securities.

         Principal Market and Stock Prices.
         ----------------------------------

     The Company's  Common Stock may be quoted in the  over-the-counter  market.
The high and low sales prices of the Company's  Common Stock are shown below for
the two years ended June 30, 2006.


                                              High       Low
Fiscal 2006
First Quarter                               $ 22.00    $ 20.50
Second Quarter                                23.00      21.60
Third Quarter                                 24.75      22.60
Fourth Quarter                                28.00      23.25

Fiscal 2005
First Quarter                               $ 16.35    $ 15.00
Second Quarter                                17.20      15.60
Third Quarter                                 19.25      17.20
Fourth Quarter                                21.00      18.50

     The closing last sale of the  Company's  Common Stock on September 11, 2006
was $29.00. The foregoing quotation and those sale prices contained in the table
above  represent  approximately  inter-dealers  prices,  without  retail markup,
markdown or  commission.  Such sale prices  should not be viewed as  necessarily
indicative  of the  price  that  could  have  been  obtained  on that date for a
substantial  number of securities  due to the limited  market and trading volume
for the Company's Common Stock.

     The approximate  number of holders of record of the Company's Common Stock,
as of September  11, 2006 was 420 as supplied by the Company's  transfer  agent,
American Stock Transfer Company, 59 Maiden Lane, New York, NY 10038.

     No cash  dividends have been paid by the Company on its Common Stock in the
past. In the future,  regular or special dividends may be paid by the Company at
the sole discretion of the Company's Board of Directors;  however,  there can be
no assurances  given that any regular or special  dividends will be declared and
paid by the Company.

                                       9
<PAGE>
Stock Repurchases
-----------------

Management of the Company over the years  received a number of comments from its
odd lot  stockholders  regarding the costs associated with any sale of their odd
lots.  Further,  management  would  like to  reduce  the  Company's  expense  of
maintaining mailings to odd lot holders. Accordingly, TNR from time-to-time over
a period of approximately ten years has privately  purchased from holders of its
Common  Stock,  such odd lots (i.e.  99 shares or less) and on a limited  basis,
round lots of 100 or more  shares.  The  purchase  price paid was based upon the
market value of the Company's Common Stock on the NASD electronic bulletin board
of the Company's  Common Stock for the preceding  trading day. The Company's odd
lot repurchase plan originally terminated in June 2005, but was extended through
January 31, 2006 to provide additional time to stockholders to present their odd
lot shares for repurchase.  Stock repurchases of the Company's Common Stock have
ceased for the foreseeable future.

     During the fiscal years 2006, 2005, 2004, 2003, 2002, and 2001, the Company
redeemed a total of 978 shares from 18 persons;  5,733  shares from 158 persons;
1,713 shares from 37 persons;  598 shares from 29 persons;  1,600 shares from 68
persons and 729 shares from 22 persons,  respectively. In June 2003, the Company
also  repurchased  a total of 691 shares  held by a director  and the  Company's
former chief executive  officer at a purchase price of $12.00 per share.  During
the quarter ended June 30, 2006, no stock repurchases took place.


------------------ ---------- ------------ ------------ ----------- ------------
2005 - 2006         QTR 1       QTR 2        QTR 3        QTR 4       YTD
------------------ ---------- ------------ ------------ ----------- ------------
# SHARES
REPURCHASED              508         223          247          -0-       978
------------------ ---------- ------------ ------------ ----------- ------------
# SHAREHOLDERS             9           4            5          -0-        18
------------------ ---------- ------------ ------------ ----------- ------------
AVG SHARE PRICE       $21.90      $22.00       $23.21          -0-    $22.25
------------------ ---------- ------------ ------------ ----------- ------------


Recent Sales of Unregistered Securities
---------------------------------------

During the past three  fiscal  years,  the Company had no sales of  unregistered
securities.


                                       10
<PAGE>
Item 6.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations.
-------  -----------------------------------------------------------------------

Forward Looking Statements
--------------------------

     This  annual  report on Form  10-KSB  contains  forward-looking  statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section  21E  of  the  Securities  Exchange  Act  of  1934,  as  amended.  These
forward-looking  statements involve risk and  uncertainties,  and actual results
could be  significantly  different than those discussed in this annual report on
Form 10-KSB. Certain statements contained herein are forward-looking statements.
These statements discuss,  among other things,  expected growth, future revenues
and/or  performance.  Although we believe  the  expectations  expressed  in such
forward-looking statements are based on reasonable assumptions within the bounds
of our knowledge of our business, a number of factors could cause actual results
to differ  materially  from those expressed in any  forward-looking  statements,
whether  oral or  written,  made  by us or on our  behalf.  The  forward-looking
statements are subject to risks and uncertainties including, without limitation,
the following: (a) changes in levels of competition from current competitors and
potential new  competition;  (b) costs of acquiring  inventory;  (c) credit risk
associated with our customers;  (d) our ability to  successfully  recover in the
event of a  disaster;  (e) the extent to which we cannot  control  our fixed and
variable  costs;  (f)  fluctuations  in the  market  price of the raw  materials
related to our goods; (g) general economic conditions in the markets in which we
operate;  and (h) the  other  uncertainties  which  are  described  under  "Risk
Factors" in Item 1. The foregoing  should not be construed as an exhaustive list
of all factors that could cause actual results to differ  materially  from those
expressed  in  forward-looking   statements  made  by  us.  All  forward-looking
statements  included in this  document are made as of the date hereof,  based on
information  available  to the  Company  on the date  thereof,  and the  Company
assumes no obligation to update any forward-looking statements.

Liquidity and Capital Resources
-------------------------------

Working  capital  amounted  to  $6,173,354  at  June  30,  2006 as  compared  to
$5,433,018 at June 30, 2005. Cash and investments amounted to $4,279,462 at June
30, 2006 as compared to $3,796,690 at June 30, 2005. As more fully  described in
the  statement  of cash flows  included in the  Company's  financial  statements
elsewhere herein, net cash provided by operating activities was $161,756.

During the fiscal  year ended June 30,  2006,  cash was  provided  by  operating
activities  mainly due to the  Company's  net income of  $725,836.  Increases in
accounts  receivable  resulted  from  increased  sales.  Cash used in  operating
activities  resulted primarily from the purchase of U.S.  Government  securities
and inventory.  Accrued  expenses  increased as a result of bonus accruals.  The
increase  in income  taxes  payable is a result of  increased  profitability  in
fiscal 2006.  Cash was used in investing  and  financing  activities to purchase
equipment and treasury stock, respectively.

                                       11
<PAGE>
During  the  eleven  months  ended June 30,  2005,  cash flow used in  operating
activities  resulted  primarily  from the  purchase of treasury  securities  and
inventory  (inventory  levels were increased in  anticipation of scheduled price
increases by several vendors).  Cash was provided predominantly by the Company's
net income of $533,879.  The increase in income taxes  payable,  and  associated
decrease in income  taxes  receivable,  are a reflection  of  recording  the tax
provision  at June 30, 2005.  Accounts  payable and accrued  expenses  decreased
primarily  as a result of the  overall  decrease  in payroll  and  bonus-related
accruals.  Net cash was used in investing and  financing  activities to purchase
equipment and treasury stock, respectively.

During fiscal 2004, cash flow used in operating  activities  resulted  primarily
from the  purchase  of  treasury  securities.  Cash was  provided  mainly by the
Company's  net income of  $454,202.  Reduced  sales  resulted  in  decreases  in
accounts  receivable.  In response to reduced sales, a concerted effort was made
by  management  to reduce the level of inventory on hand.  Accounts  payable and
accrued  expenses  decreased for the most part as a result of reduced  inventory
levels. The decrease in income tax payable and the subsequent increase in income
tax receivable  resulted from the payment of tax  obligations  and estimated tax
payments.  Cash was used in investing  activities  to purchase  equipment and in
financing activities to purchase treasury stock.

During the past three years,  the Company's  liquidity needs have been satisfied
from internal sources  including cash from operations and amounts available from
the Company's working capital. During fiscal 2007, management expects this trend
to continue.  There are no material  commitments for capital expenditures or any
long-term credit arrangements as of June 30, 2006.

Recent Trends
-------------

     Competition  in  wholesale  distribution  of  batteries  is  increasing  as
offshore  and U.S.  manufacturers  sell  directly to  customers  competing  with
distributors for the same market.  Despite  increased  competition,  new battery
companies have entered the market offering lower prices, and selling directly to
the end-user via  web-based  operations.  This,  combined  with the expansion of
local battery franchises in cities throughout the USA has increased the level of
competition in the battery market.

Results of Operations
---------------------

Net sales for the fiscal  year  ended  June 30,  2006  increased  $2,406,732  to
$9,724,432  over  sales  for the  eleven  month  period  ended  June  30,  2005.
Approximately 22% of the increase is attributable to the additional month in the
fiscal year ended June 30, 2006.  The remaining  increase in sales is the result
of the  addition of new product  lines and a more  firmly  established  internet
presence.  Furthermore, the Company evaluated the buying patterns of some of our
larger volume customers and provided  additional  resource planning to them, the
result of which is an initial  increase in sales  volume  which should level off
with time.  Net sales  decreased  $678,913 for the eleven  months ended June 30,
2005 as compared to the twelve months ended July 30, 2004. The decrease in sales
between the two periods is slightly  higher than the average  monthly  sales for
the eleven months ended June 30, 2005 of $665,245, primarily as a result of lost
shipping  days in the  final  week  of  June  2005  in  order  to take  physical
inventory.  During the past three years, no customer accounted for more than 10%
of revenues.

The Company's gross margin remained  relatively fixed at  approximately  30% for
the fiscal year ended June 30, 2006 and the eleven months ended June 30, 2005 up
from  approximately 28% for the fiscal year ended July 31, 2004 due primarily to
the discontinuation of a 2004 sales commission plan. Operating (selling, general
and administrative) expenses, when expressed as a percentage of sales, decreased
to 18% for the fiscal year ended June 30, 2006 from 18.9% for the eleven  months
ended June 30, 2005 and 18.8% for the fiscal year ended July 31, 2004.

                                       12
<PAGE>
During the past three years,  the Company did not charge its operations with any
research  and  development  costs.   Increased  interest  income  ($20,662)  and
investment  losses  ($11,493)  were  the  result  of the  investment  of  excess
operating cash in  certificates  of deposit and the  fluctuation in the value of
treasury securities, respectively.

Net income for the fiscal year ended June 30,  2006 was  $725,836 as compared to
$533,879  for the eleven  months ended June 30, 2005 and $454,202 for the fiscal
year ended July 31, 2004. Basic earnings per share for fiscal 2006,  fiscal 2005
and fiscal 2004 were $2.79, $2.02, and $1.70 respectively.

Item 7.  Financial Statements.
------   ---------------------

     The information required by Item 8, and an index thereto,  appears at pages
F-1 through F-22 (inclusive) of this Report, which pages follow this page.


                                       13
<PAGE>
                               TNR TECHNICAL, INC.

                              Financial Statements

                             June 30, 2006 and 2005


                   (With Independent Auditors' Report Thereon)




<PAGE>
<TABLE>
<CAPTION>
<S>                                                                                                      <C>
                               TNR TECHNICAL, INC.

                          Index to Financial Statements





Independent Auditors' Report...........................................................................F-1

Financial Statements:

        Balance Sheets - June 30, 2006 and 2005........................................................F-2

        Statements of Operations - Year ended June 30, 2006, the eleven months
           ended June 30, 2005 and the year
           ended July 31, 2004.........................................................................F-4

        Statements of Shareholders' Equity - Year ended June 30, 2006, the
           eleven months ended June 30, 2005 and the year ended
           July 31, 2004...............................................................................F-5

        Statements of Cash Flows - Year ended June 30, 2006, the eleven months
           ended June 30, 2005 and the year
           ended July 31, 2004.........................................................................F-6

Notes to Financial Statements..........................................................................F-8
</TABLE>



<PAGE>



                          TSCHOPP, WHITCOMB & ORR, P.A.
                     2600 Maitland Center Parkway, Suite 330
                               Maitland, FL 32751




                          Independent Auditors' Report





The Shareholders and Board of Directors
TNR Technical, Inc.:


We have audited the accompanying balance sheets of TNR Technical, Inc. as of
June 30, 2006 and 2005, and the related statements of operations, shareholders'
equity and cash flows for the year ended June 30, 2006, the eleven months ended
June 30, 2005 and the year ended July 31, 2004. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.

We conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of TNR Technical, Inc. as of June
30, 2006 and 2005 and the results of its operations and its cash flows for the
year ended June 30, 2006, the eleven months ended June 30, 2005 and the year
ended July 31, 2004 in conformity with accounting principles generally accepted
in the United States of America.


/s/  Tschopp, Whitcomb & Orr, P.A.



August 18, 2006
Maitland, Florida



                                      F-1
<PAGE>
<TABLE>
<CAPTION>
                               TNR TECHNICAL, INC.

                                 Balance Sheets

                             June 30, 2006 and 2005



                                     Assets

                                                                                         2006                  2005
                                                                                  -------------------   -------------------

<S>                                                                               <C>                               <C>
Current assets:
     Cash and cash equivalents                                                    $           522,151               431,632
      Investments (note 4)                                                                  3,757,311             3,365,058
     Accounts receivable - trade, less allowance for doubtful
         accounts of $24,842 in 2006 and $15,139 in 2005                                      763,125               654,007
     Inventories (note 2)                                                                   1,387,165             1,188,845
     Prepaid expenses and other current assets                                                 32,739                30,795
     Deferred income taxes (note 6)                                                           184,000               120,000
                                                                                  -------------------   -------------------

               Total current assets                                                         6,646,491             5,790,337

Property and equipment, at cost, net of accumulated
   depreciation and amortization (note 3)                                                     127,651               126,385

Other assets:
     Deposits                                                                                  16,360                15,884
                                                                                  -------------------   -------------------

                                                                                  $         6,790,502             5,932,606
                                                                                  ===================   ===================

</TABLE>
See accompanying notes to financial statements.


                                      F-2
<PAGE>
<TABLE>
<CAPTION>
                               TNR TECHNICAL, INC.

                                 Balance Sheets

                             June 30, 2006 and 2005



                      Liabilities and Shareholders' Equity

                                                                                            2006                2005
                                                                                   -----------------------------------------
<S>                                                                                <C>                    <C>
Current liabilities:
     Accounts payable                                                              $           126,939    $          122,400
     Accrued expenses                                                                          177,198               128,538
     Income taxes payable (note 6)                                                             169,000               106,381
                                                                                   -------------------    ------------------

               Total current liabilities                                                       473,137               357,319

Deferred tax liability (note 6)                                                                 20,000                20,000
                                                                                   -------------------    ------------------

               Total liabilities                                                               493,137               377,319
                                                                                   -------------------    ------------------

Commitment (note 7)

Shareholders' equity:
     Common stock - $.02 par value, authorized 500,000
        shares; issued and outstanding 313,581
        shares in 2006 and 2005 (note 5)                                                         6,272                 6,272
     Additional paid-in capital                                                              2,736,261             2,698,261
     Retained earnings                                                                       3,963,382             3,237,546
                                                                                   -------------------    ------------------

                                                                                             6,705,915             5,942,079
     Less cost of treasury stock, 53,786 and 52,808
        shares in 2006 and 2005, respectively                                                 (408,550)             (386,792)
                                                                                   -------------------    ------------------

               Total shareholders' equity                                                    6,297,365             5,555,287
                                                                                   -------------------    ------------------

                                                                                   $         6,790,502    $        5,932,606
                                                                                   ===================    ==================

</TABLE>
See accompanying notes to financial statements.

                                      F-3
<PAGE>
<TABLE>
<CAPTION>
                               TNR TECHNICAL, INC.

                            Statements of Operations

 Year ended June 30, 2006, the eleven months ended June 30, 2005 and the year ended July 31, 2004


                                                                     2006                    2005                    2004
                                                               ------------------      ------------------     -------------------
<S>                                                            <C>                              <C>                     <C>
Revenues:
     Net sales (note 9)                                        $        9,724,432               7,317,700               7,996,613
                                                               ------------------      ------------------     -------------------

Cost and expenses:
     Cost of goods sold                                                 6,764,385               5,155,234               5,784,775
     Selling, general and administrative (note 10)                      1,750,161               1,382,494               1,507,757
                                                               ------------------      ------------------     -------------------

                                                                        8,514,546               6,537,728               7,292,532
                                                               ------------------      ------------------     -------------------

               Operating income                                         1,209,886                 779,972                 704,081

Non-operating revenue (expense):
     Interest income                                                       20,662                   8,913                   1,338
     Investment gains (losses), net (note 4)                              (11,493)                 75,324                  48,113
     Other, net (note 11)                                                       -                       -                 (10,330)
                                                               ------------------      ------------------     -------------------

               Income before income taxes                               1,219,055                 864,209                 743,202

Income tax expense (note 6)                                               493,219                 330,330                 289,000
                                                               ------------------      ------------------     -------------------

               Net income                                      $         725,836                  533,879                454,202
                                                               ==================      ==================     ===================

Basic earnings per share                                       $             2.79                    2.02                    1.70
                                                               ==================      ==================     ===================

Diluted earnings per share                                     $             2.44                    1.77                    1.52
                                                               ==================      ==================     ===================

Weighted average number of shares - Basic                                 260,109                 264,843                 266,552
                                                               ==================      ==================     ===================

Weighted average number of shares - Diluted                               297,000                 301,110                 299,389
                                                               ==================      ==================     ===================

</TABLE>
See accompanying notes to financial statements.

                                      F-4
<PAGE>
<TABLE>
<CAPTION>

                               TNR TECHNICAL, INC.

                       Statements of Shareholders' Equity

 Year ended June 30, 2006, the eleven months ended June 30, 2005 and the year ended July 31, 2004


                                                                           Additional
                                             Common Stock                    Paid-in            Retained            Treasury
                                      Shares              Amount             Capital            Earnings             Stock
                                -----------------   -----------------   ----------------   -----------------   -----------------
<S>                              <C>                <C>                <C>                 <C>                  <C>
Balances, July 31, 2003                   313,581   $           6,272          2,698,261           2,249,465            (244,111)

Net income                                      -                   -                  -             454,202                   -

Purchase of Company
   stock                                        -                   -                  -                   -             (26,360)
                                -----------------   -----------------   ----------------   -----------------   -----------------

Balances, July 31, 2004                   313,581               6,272          2,698,261           2,703,667            (270,471)

Net income                                      -                   -                  -             533,879                   -

Purchase of Company
   stock                                        -                   -                  -                   -            (116,321)
                                -----------------   -----------------   ----------------   -----------------   -----------------

Balances, July 31, 2005                   313,581               6,272          2,698,261           3,237,546            (386,792)

Issuance of stock options                       -                   -             38,000                   -                   -

Net income                                      -                   -                  -             725,836                   -

Purchase of Company
   stock                                        -                   -                  -                   -             (21,758)
                                -----------------   -----------------   ----------------   -----------------   -----------------

Balances, June 30, 2006                   313,581   $         $ 6,272          2,736,261           3,963,382            (408,550)
                                =================   =================   ================   =================   =================

</TABLE>
See accompanying notes to financial statements.

                                      F-5


<PAGE>
<TABLE>
<CAPTION>
                               TNR TECHNICAL, INC.

                            Statements of Cash Flows

 Year ended June 30, 2006, eleven months ended June 30, 2005 and the year ended July 31, 2004



                                                                               2006               2005                2004
                                                                         -----------------  -----------------   -----------------
<S>                                                                      <C>                 <C>                   <C>
Cash flows from operating activities:
   Net income                                                            $         725,836            533,879             454,202
   Adjustments to reconcile net income to net cash
      provided by operations:
         Deferred income taxes                                                     (64,000)           (17,000)            (34,000)
         Depreciation and amortization                                              48,213             52,813              45,305
         Provision for doubtful accounts                                             8,400              7,700               8,400
         Investment losses (gains), net                                             11,493            (75,324)            (48,113)
         Loss on disposition of fixed assets                                             -                  -              10,330
         Issuance of stock options                                                  38,000                  -                   -
         Changes in operating assets and liabilities:
           Accounts receivable                                                    (117,518)           (12,689)             81,863
             Purchase of investments and accrued interest                         (403,746)          (681,024)           (570,538)
           Inventories                                                            (198,320)           (61,702)            157,654
           Prepaid expenses and other assets                                        (1,944)             1,947              (6,142)
           Accounts payable and accrued expenses                                    53,199            (49,917)            (24,459)
           Deposits                                                                   (476)               307                   -
           Income taxes receivable/payable                                          62,619            176,639            (128,284)
                                                                         -----------------  -----------------   -----------------

             Net cash provided by (used in) operating activities                   161,756           (124,371)            (53,782)
                                                                         -----------------  -----------------   -----------------

Cash flows from investing activities:
     Purchase of property and equipment                                            (49,479)           (38,312)            (43,123)
                                                                         -----------------  -----------------   -----------------


             Net cash used in investing activities                                 (49,479)           (38,312)            (43,123)
                                                                         -----------------  -----------------   -----------------

</TABLE>
See accompanying notes to financial statements.

                                      F-6
<PAGE>
<TABLE>
<CAPTION>
                               TNR TECHNICAL, INC.

                      Statements of Cash Flows (Continued)

 Year ended June 30, 2006, the eleven months ended June 30, 2005 and the year ended July 31, 2004



                                                                               2006               2005                2004
                                                                         -----------------  -----------------   -----------------
<S>                                                                      <C>                         <C>                  <C>
Cash flows from financing activities:
         Purchase of treasury stock                                      $         (21,758)          (116,321)            (26,360)
                                                                         -----------------  -----------------   -----------------

             Net cash used in financing activities                                 (21,758)          (116,321)            (26,360)
                                                                         -----------------  -----------------   -----------------

             Increase (decrease) in cash and cash equivalents                       90,519           (279,004)           (123,265)

Cash and cash equivalents - beginning of year                                      431,632            710,636             833,901
                                                                         -----------------  -----------------   -----------------

Cash and cash equivalents - end of year                                  $         522,151            431,632             710,636
                                                                         =================  =================   =================

Supplemental disclosures of cash flow information:
         Cash paid during the year for interest                          $               -                  -                   -
                                                                         =================  =================   =================

         Cash paid during the year for income taxes                      $         405,777            720,691             452,258
                                                                         =================  =================   =================

</TABLE>
See accompanying notes to financial statements.

                                      F-7
<PAGE>

                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(1)  Summary of Significant Accounting Policies
     ------------------------------------------

     (a)  Nature of Operations
          --------------------

          TNR  Technical,  Inc.  (TNR or the  Company)  designs,  assembles  and
          markets  batteries and  multi-cell  battery packs to a wide variety of
          industrial markets. The Company is a distributor for a number of major
          U.S. battery manufacturers and markets its products nationally.

     (b)  Accounts Receivable
          -------------------

          Accounts  receivable  are stated at the amount  management  expects to
          collect from outstanding  balances.  Management  provides for probable
          uncollectible amounts using the reserve method based on its assessment
          of the current  status of the individual  receivables  and after using
          reasonable collection efforts. As of June 30, 2006, the balance of the
          reserve recorded for  uncollectible  amounts amounted to approximately
          $25,000.

     (c)  Investments
          -----------

          Management determines the appropriate classification of investments at
          the time of acquisition and  reevaluates  such  determination  at each
          balance sheet date. Trading securities are carried at fair value, with
          unrealized   holding   gains  and   losses   included   in   earnings.
          Available-for-sale   securities  are  carried  at  fair  value,   with
          unrealized holding gains and losses, net of tax reported as a separate
          component of stockholders'  equity.  Investments in equity  securities
          and limited  partnerships  that do not have readily  determinable fair
          values are stated at cost and are  categorized  as other  investments.
          Realized   gains  and  losses  are   determined   using  the  specific
          identification  method  based  on the  trade  date  of a  transaction.
          Interest on corporate  obligations,  as well as dividends on preferred
          stock, are accrued at the balance sheet date.

     (d)  Inventories
          -----------

          Inventories  are  stated  at the  lower  of  cost or  market.  Cost is
          determined by the first-in,  first-out  method.  Most of the Company's
          inventory  consists of  purchased  product  held for resale.  Finished
          goods,  (including  work-in-progress),  represent  assembled  products
          which are generally  minimal with respect to inventory  balances taken
          as a whole. These products, which are substantially produced on a made
          to order  basis,  include  all direct  costs such as labor,  purchased
          products/materials  and indirect  costs  associated  with the assembly
          process, such as indirect labor, supplies and warehousing costs.

                                      F-8

<PAGE>
                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(1)  Summary of Significant Accounting Policies - Continued
     ------------------------------------------------------

     (e)  Property and Equipment
          ----------------------

          Property  and  equipment  are recorded at cost.  The Company  provides
          depreciation  for  machinery  and  equipment  using the  straight-line
          method over the estimated useful lives of the respective assets, which
          range from five to ten years.  Amortization of leasehold  improvements
          is  computed  using the  straight-line  method  over the lesser of the
          lease term or estimated useful lives of the improvements.

     (f)  Research and Development Costs
          ------------------------------

          Research and development  costs are charged against income in the year
          incurred.

     (g)  Revenue Recognition
          -------------------

          The Company,  consistent with the practice of most entities  operating
          in the battery distribution business, recognizes revenue upon shipment
          of battery  products  from its  warehouse  facilities.  The  Company's
          customers  take title to the products at the time of shipment and bear
          the cost of freight.  There is no continuing performance obligation by
          the Company  subsequent to shipment of product.  The costs incurred by
          the Company for shipping and handling are reported as an expense.

     (h)  Advertising Costs
          -----------------

          Advertising   expenditures   relating  to  product   distribution  and
          marketing efforts consisting primarily of pay per click ads, telephone
          book ads, product presentation material, catalog preparation, printing
          and postage expenses are expensed as incurred.

     (i)  Use of Estimates
          ----------------

          Management of the Company has made certain  estimates and  assumptions
          relating to the reporting of assets and  liabilities and disclosure of
          contingent   assets  and   liabilities  to  prepare  these   financial
          statements   in  conformity   with   generally   accepted   accounting
          principles. Actual results could differ from those estimates.


                                                                     (Continued)

                                      F-9
<PAGE>

                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(1)  Summary of Significant Accounting Policies - Continued
     ------------------------------------------------------

     (j)  Financial Instruments Fair Value, Concentration of Business and Credit
          Risks
          ----------------------------------------------------------------------

          The carrying  amount reported in the balance sheet  approximates  fair
          value for cash, investments, accounts receivable, accounts payable and
          accrued expenses. Financial instruments, which potentially subject the
          Company to concentrations of credit risk, consist principally of trade
          accounts  receivable  which  amount  to  approximately  $765,000.  The
          Company  performs  periodic credit  evaluations of its trade customers
          and generally does not require  collateral.  The Company maintains its
          cash balances at certain financial  institutions in which balances are
          insured by the Federal Deposit  Insurance  Corporation up to $100,000.
          The Company's uninsured balances amount to approximately  $285,000 and
          $167,000 at June 30, 2006 and 2005, respectively.

     (k)  Stock-Based Compensation
          ------------------------

          In October  1995,  the  Financial  Accounting  Standards  Board issued
          Statement of Financial  Accounting  Standards No. 123, "Accounting for
          Stock-Based  Compensation"  (SFAS 123) which sets forth accounting and
          disclosure requirements for stock-based compensation arrangements. The
          statement  encourages  but  does not  require,  companies  to  measure
          stock-based  compensation  using a fair value method,  rather than the
          intrinsic  value method  prescribed  by  Accounting  Principles  Board
          Opinion No. 25 ("APB no.  25".) The  Company  has  adopted  disclosure
          requirements  of SFAS  123 and  has  elected  to  continue  to  record
          stock-based  compensation  expense using the intrinsic  value approach
          prescribed  by  APB  No.  25.   Accordingly,   the  Company   computes
          compensation cost for each employee stock option granted as the amount
          by which the quoted market price of the Company's  common stock on the
          date of grant  exceeds the amount the employee must pay to acquire the
          stock.  The amount of  compensation  cost,  if any, will be charged to
          operations  over  the  vesting  period.  SFAS 123  requires  companies
          electing to continue using the intrinsic  value method to make certain
          pro forma disclosures (see note 5).

          In 2004 the Financial  Accounting  Standards Board issued Statement of
          Financial  Accounting  Standards No. 123 (Revised 2004) referred to as
          SFAS 123R.  This  statement,  among other things,  mandated fair value
          accounting  for  stock-based   employee   compensation   arrangements.
          Accordingly,  for all stock-based employee  compensation  arrangements
          implemented subsequent to the effective date, (December 31, 2005), the
          Company is required to measure  employee  stock  options  (and similar
          instruments) with a fair value method rather than the intrinsic method
          described in the immediately preceding paragraph.


                                      F-10
<PAGE>
                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(1)  Summary of Significant Accounting Policies - Continued
     ------------------------------------------------------

     (l)  Income Taxes
          ------------

          Deferred tax assets and  liabilities are recognized for the future tax
          consequences   attributable  to  differences   between  the  financial
          statement  carrying  amounts of existing  assets and  liabilities  and
          their  respective tax bases.  Deferred tax assets and  liabilities are
          measured  using enacted tax rates  expected to apply to taxable income
          in the years in which those  temporary  differences are expected to be
          recovered   or  settled.   The  effect  on  deferred  tax  assets  and
          liabilities  of a change in tax rates is  recognized  in income in the
          period that includes the enactment date.

     (m)  Cash Flows
          ----------

          For purposes of cash flows,  the Company  considers  all highly liquid
          investments  with an initial  maturity  of three  months or less to be
          cash equivalents.

     (n)  Earnings Per Common Share
          -------------------------

          Basic  earnings  per common  share have been  computed  based upon the
          weighted average number of common shares  outstanding during the years
          presented. Common stock equivalents resulting from the issuance of the
          stock options are included in the calculation of diluted  earnings per
          share information.

     (o)  Reclassifications
          -----------------

          Certain  amounts from 2005 and 2004 have been  reclassified to conform
          with the 2006 presentation.

(2)  Inventories
     -----------

    Inventories consist of the following:

                                                      2006               2005
                                                      ----               ----

       Finished goods/work-in-progress              $  41,615            35,665

       Purchased product and materials              1,345,550         1,153,180
                                                    ---------         ---------

                                                   $1,387,165         1,188,845
                                                   ==========         =========


                                      F-11
<PAGE>

                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(3)  Property and Equipment
     ----------------------

     Property and equipment consists of the following:

                                                               2006       2005
                                                               ----       ----

    Machinery and equipment                                 $ 322,917   312,799
    Leasehold improvements                                     28,355    25,749
                                                               ------    ------

                                                              351,272   338,548
    Less accumulated depreciation and amortization            223,621   212,163
                                                              -------   -------

                                                            $ 127,651   126,385
                                                            =========   =======

(4)  Investments
     -----------

     Investments  held by the Company are  classified as trading  securities and
     consist of  certificates  of deposit and certain  government  and corporate
     fixed income securities.

     Unrealized gains and losses associated with trading securities are included
     in earnings on a current  basis.  Realized  trading gains  associated  with
     trading  securities  in 2006 amounted to $117,549.  The Company  determines
     cost on the specific  identification  basis. The following table summarizes
     the Company's investments at June 30, 2006.
<TABLE>
<CAPTION>
                                                            Fair                               Unrealized
                                                           Value                Cost          Gains (Losses)
                                                     -----------------    ---------------    -----------------
<S>                                                          <C>                  <C>
    Certificates of deposit                                  $ 719,714            719,714                    -

    U.S. Government notes                                    2,906,748          3,030,420             (123,672)
    Corporate fixed income bonds                                94,630            100,000               (5,370)
    Accrued interest                                            36,219             36,219                    -
                                                     -----------------    ---------------    -----------------

                                                            $3,757,311          3,886,353             (129,042)
                                                     =================    ===============    =================
</TABLE>

                                      F-12
<PAGE>
                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(5)  Stock Option Plans
     ------------------

     In  November  1992,  the  Board of  Directors  approved  an  Incentive  and
     Non-Qualified  Stock  Option  Plan  (Plan),   which  was  ratified  by  the
     stockholders  in January  1993.  The Plan  covers  60,000  shares of Common
     Stock,  subject to adjustment of shares under the anti-dilution  provisions
     of the Plan.  The Plan  authorizes  the  issuance  of the  options  covered
     thereby as either  "Incentive  Stock  Options"  within  the  meaning of the
     Internal  Revenue  Code of 1986,  as amended,  or as  "Non-Statutory  Stock
     Options." No options may be granted after November 16, 2002. Under the Plan
     the  aggregate  fair  market  value  (determined  at the time the option is
     granted)  of the  optioned  stock for which  Incentive  Stock  Options  are
     exercisable  for the first time by any employee  during any  calendar  year
     shall not exceed $100,000.

     In December 1996, the Company  granted options to purchase 30,000 shares of
     stock at an exercise price of $3.25 per share (the fair market value of the
     underlying  stock  at the date of  grant)  to  three  of its  officers  and
     directors.  The options are  exercisable  for a ten-year period expiring in
     December  2006. In December  1998,  the Company  granted  additional  stock
     options to purchase  7,000  shares at an exercise  price of $5.00 per share
     (the fair  market  value of the  underlying  stock at the date of grant) to
     three of its directors.  The options are exercisable through December 2008.
     In December 2001, the Company  granted options to purchase 23,000 shares at
     an  exercise  price of $6.80 per share to its chief  executive  officer and
     chairman of the board.

     The 1998 Incentive and Non-Qualified  Stock Option Plan, (the "1998 Plan"),
     was approved by the Board of Directors  effective December 15, 1998 subject
     to  stockholder  approval  within 12 months.  The 1998 Plan  covers  60,000
     shares  of  Common  Stock,  subject  to  adjustment  of  shares  under  the
     anti-dilution  provisions of the 1998 Plan.  The 1998 Plan  authorizes  the
     issuance of the options covered thereby as either "Incentive Stock Options"
     within the meaning of the Internal Revenue Code of 1986, as amended,  or as
     "Non-Statutory  Stock Options."  Persons  eligible to receive options under
     the 1998  Plan  include  employees,  directors,  officers,  consultants  or
     advisors, provided that bona fide services shall be rendered by consultants
     or advisors and such services  must not be in connection  with the offer or
     sale  of  securities  in  a  capital  raising  transaction;  however,  only
     employees  (who may also be  officers  and/or  directors)  are  eligible to
     receive an Incentive  Stock  Option.  The 1998 Plan also  provides  that no
     options may be granted after  December 15, 2008. In August 2005 and January
     2006, the Company  granted options on each date to purchase 5,000 shares of
     common stock at exercise  prices of $21.00 and $22.60,  respectively,  (the
     fair market value of the  underlying  stock at these  dates),  to its chief
     executive officer and chairman of the Board.

                                                                     (Continued)


                                      F-13
<PAGE>
                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(5)  Stock Option Plans - Continued
     ------------------------------

     Options granted and issued by the Company consist of the following:
<TABLE>
<CAPTION>

                                                                Number                  Weighted Average Price
                                                                ------                  ----------------------
<S>                                                               <C>                        <C>
     Balance outstanding, July 31, 1997                              30,000                     $ 3.25
                 Options granted                                        -                          -
                 Options expired                                        -                          -
                                                          -------------------       ---------------------------------

     Balance outstanding, July 31, 1998                              30,000                       3.25
                 Options granted                                      7,000                       5.00
                 Options expired                                        -                          -
                                                          -------------------       ---------------------------------

     Balance outstanding, July 31, 1999                              37,000                       3.58
                 Options granted                                        -                          -
                 Options expired                                        -                          -
                                                          -------------------       ---------------------------------

     Balance outstanding, July 31, 2000                              37,000                       3.58
                 Options granted                                        -                          -
                 Options expired                                        -                          -
                                                          -------------------       ---------------------------------

     Balance outstanding, July 31, 2001                              37,000                       3.58
                 Options granted                                     23,000                       6.80
                 Options exercised                                  (12,000)                      3.54
                                                          -------------------       ---------------------------------

     Balance outstanding, July 31, 2002                              48,000                       5.13
                 Options granted                                        -                           -
                 Options exercised                                      -                           -
                                                          -------------------       ---------------------------------

     Balance outstanding, July 31, 2003                              48,000                       5.13
                 Options granted                                        -                           -
                 Options exercised                                      -                           -
                                                          -------------------       ---------------------------------

     Balance outstanding, July 31, 2004                              48,000                       5.13
</TABLE>

                                                                     (Continued)


                                      F-14
<PAGE>
                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

<TABLE>
<CAPTION>

(5)  Stock Option Plans - Continued
     ------------------------------
                                                                Number               Weighted Average Price
                                                                ------               ----------------------
<S>                                                              <C>                       <C>
     Balance outstanding, July 31, 2004                              48,000                    5.13
                 Options granted                                        -                        -
                 Options exercised                                      -                        -
                                                          -------------------      ---------------------------

     Balance outstanding, June 30, 2005                              48,000                    5.13
                 Option grants                                       10,000                   21.80
                 Option exercised                                       -                        -
                                                          -------------------      ---------------------------

     Balance outstanding, June 30, 2006                              58,000                    8.00
                                                          ===================      ===========================
</TABLE>

Information relating to options at June 30, 2006,  summarized by exercise price,
is as follows:


          Outstanding and Exercisable                  Weighted Average
          ---------------------------                  ----------------
    Exercise Price       Equivalent Shares       Exercise Price         Year
    --------------       -----------------       --------------         ----
        $ 3.25                   20,000              3.25                0.5
          5.00                    5,000              5.00                2.5
          6.80                   23,000              6.80                5.5
         21.00                    5,000             21.00                9.0
         22.60                    5,000             22.60                9.5
                                 ------
                                 58,000              8.00                4.2
                                 ======

Through  December 31,  2005,  the Company  continued to account for  stock-based
compensation  using  the  intrinsic  value  method  prescribed  by SFAS  123 and
Accounting  Principles Board Opinion No. 25 under which no compensation cost for
stock  options is recognized  for stock option  awards  granted at or above fair
market value.  Subsequent to this date, in January 2006,  options issued for the
purchase  of 5,000  shares of common  stock  were  valued at  $38,000  using the
Black-Scholes  option-pricing  model in accordance  with the  provisions of SFAS
123R and recorded as  compensation  expense in the  accompanying  2006 financial
statements.


                                                                     (Continued)


                                      F-15
<PAGE>

                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(5)  Stock Option Plans - Continued
     ------------------------------

SFAS No. 123 requires that companies  using the intrinsic  value method make pro
forma  disclosure  of net  income  and net income per share as if the fair value
method of accounting  had been applied.  For purposes of pro forma  disclosures,
the Company  used the  Black-Scholes  option-pricing  model to estimate the fair
value of options  issued in August 2005. The estimated fair value of the options
is  amortized  to  expense  over  the  options'  expected  vesting  period.  Had
compensation  cost for the Company's stock option plan been determined  based on
the estimated fair value at the grant dates for awards under the plan consistent
with  the  fair  value  method  of SFAS  No.  123  utilizing  the  Black-Scholes
option-pricing  model,  the Company's net income and basic and diluted  earnings
per share for the year ended June 30, 2006 and the eleven  months ended June 30,
2005 would have approximated the pro forma amounts indicated below:
<TABLE>
<CAPTION>
                                                                                       2006               2005
                                                                                       ----               ----
<S>                                                                               <C>                       <C>
Net income
  As reported                                                                     $     725,836             553,879
  Deduct total stock-based compensation expense determined
     under fair value based method                                                      (35,136)                  -
                                                                                  -------------      --------------

  Pro forma                                                                       $     690,700             533,879
                                                                                  =============      ==============

Basic earnings per share
   As reported                                                                    $        2.79                2.02
   Pro forma                                                                               2.66                2.02

Diluted earnings per share
   As reported                                                                    $        2.44                1.77
   Pro forma                                                                               2.33                1.77
</TABLE>

The  computation  of the  effect on net  earnings  and  earnings  per share with
respect to outstanding  options in accordance with SFAS 123 was calculated using
the Black-Scholes  option-pricing model which included the following significant
assumptions:

           Risk-free interest rate                             4.25%
           Expected volatility                                10.00%
           Expected dividend yield                             0.00%
           Expected life                                    10 years

The  weighted  average  fair value at the date of grant of the  options  granted
during the year ended June 30, 2006 approximated $7.25 per option.


                                                                     (Continued)

                                      F-16
<PAGE>

                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(5)  Stock Option Plans - Continued
     ------------------------------

The Black-Scholes option valuation model was developed for use in estimating the
fair value of traded options,  which have no vesting  restrictions and are fully
transferable.  In addition,  option valuation models require the input of highly
subjective  assumptions  including the expected stock price volatility.  Because
the  Company's  employee  stock  options  have   characteristics   significantly
different from those of traded  options,  and because  changes in the subjective
input assumptions can materially affect the fair value estimate, in management's
opinion,  the  existing  models do not  necessarily  provide a  reliable  single
measure of the fair value of its employee stock options.

(6)  Income Taxes
     ------------

The income tax provision for the year ended June 30, 2006, the eleven months
ended June 30, 2005 and the year ended July 31, 2004 consists of the following:

                                       2006           2005         2004
                                     ---------       --------      -------

      Current:
           Federal                   $ 453,277        293,260      240,000
           State                       103,942         54,070       55,000
                                     ---------       --------      -------

                                       557,219        347,330      295,000
                                     ---------       --------      -------

      Deferred:
           Federal                     (53,000)       (13,000)      (5,000)
           State                       (11,000)        (4,000)      (1,000)
                                     ---------       --------      -------

                                       (64,000)       (17,000)      (6,000)
                                     ---------       --------      -------

               Total                 $ 493,219        330,330      289,000
                                     =========       ========     ========

Income tax expense  attributable  to income  before income tax differed from the
amount  computed by applying the U.S.  Federal  income tax rate of 34% to income
from operations before income taxes as a result of the following:

                                                                     (Continued)


                                      F-17
<PAGE>

                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(6)  Income Taxes - Continued
     ------------------------
<TABLE>
<CAPTION>
                                                          2006         2005          2004
                                                          ----         ----          ----
<S>                                                    <C>           <C>           <C>
Computed "expected" tax expense                        $ 418,000     294,000       253,000
Increase (reduction) in income tax expense
    resulting from:
       State income taxes, net of federal
          income tax benefit                              45,000      42,000        37,000
       Under (over) accrual of income tax
          liability in prior year                          3,000      (3,000)            -
       Adjustment to deferred tax assets to
          reflect current effective tax rates
          and other                                       27,219      (2,670)       (1,000)
                                                       ---------    --------      --------

                                                       $ 493,219     330,330       289,000
                                                       =========    ========      ========
</TABLE>
The tax effects of temporary  differences that give rise to significant portions
of the  deferred  tax  assets  and  liabilities  at June  30,  2006 and 2005 are
presented below:

                                                             2006         2005
                                                             ----         ----
Deferred tax assets:
   Inventories, principally due to additional costs
     inventoried for tax purposes                          $ 59,000      58,000
   Accounts receivable, due to allowance for
     uncollectible accounts                                  10,000       6,000
   Investments, due to exclusion of unrealized losses
     for tax purposes                                       100,000      56,000
   Value of stock options issued                             15,000        -
                                                           --------    --------


                                                            184,000     120,000
Less valuation allowance                                       -           -
                                                           --------    --------


                                                            184,000     120,000
                                                           --------    --------
Deferred tax liabilities:
   Property and equipment, due to additional
     depreciation for tax purposes                          (20,000)    (20,000)
                                                           --------    --------

         Net deferred tax assets                           $164,000     100,000
                                                           ========    ========


                                                                     (Continued)

                                      F-18
<PAGE>

                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(6)  Income Taxes - Continued
     ------------------------

Deferred taxes are presented in the accompanying balance sheets as:


                                                          2006             2005
                                                          ----             ----

   Current deferred tax assets                          $184,000        120,000
   Noncurrent deferred tax liability                     (20,000)       (20,000)
                                                        --------       --------
                                                        $164,000        100,000
                                                        ========        =======

In assessing  the  realizability  of deferred tax assets,  management  considers
whether it is more likely than not that some  portion or all of the deferred tax
assets will be realized.  Management  considers  the  projected  future  taxable
income and tax  planning  strategies  in making  this  assessment.  The  Company
believes  that  future  earnings  in  addition  to the  amount  of  the  taxable
differences  which will reverse in future periods,  will be sufficient to offset
recorded  deferred  tax assets and,  accordingly,  a valuation  allowance is not
considered necessary at June 30, 2006 and 2005.

At June 30, 2006 and 2005, the Company recorded a liability for estimated income
taxes payable in excess of estimated tax payments made of $169,000 and $106,381,
respectively.

(7)  Lease Commitments

The Company leases its Florida  office,  warehouse and  distribution  facilities
from a partnership controlled by an executive officer,  shareholder and director
of TNR. The lease agreement  provides payment of real estate taxes and insurance
and extends through May 2011. The Company also leases warehouse and distribution
facilities in California  from an unrelated  party under a three-year  operating
lease agreement expiring in 2006. Future minimum rental payments associated with
these operating lease obligations are indicated below:

                Year Ending June 30,
                --------------------
                        2007                     167,000
                        2008                     175,000
                        2009                     105,000
                        2010                     109,000
                        2011                     104,000

Total lease and rental expense amounted to $174,858, $153,849 and $161,420 in
2006, 2005, and 2004, respectively. In 2006, 2005 and 2004 lease expense
associated with related parties amounted approximately to $108,000, $95,000 and
$91,000, respectively.

                                      F-19
<PAGE>
                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(8)  Retirement Plan
     ---------------

The Company  participates  in a qualified  retirement  plan (Plan) with a salary
deferral  feature  designed to qualify under Section 401 of the Internal Revenue
Code.  Employees of the Company are eligible to  participate in the Plan if they
meet certain minimum age and period of credited service  requirements.  The Plan
allows  participants to defer up to 25% of their compensation on a pre-tax basis
subject to certain maximum amounts. The Plan allows the Company to make matching
contributions  not to exceed 6% of the  eligible  participant  compensation.  In
2006, 2005 and 2004, the Company made matching contributions of $49,052, $21,550
and $34,608, respectively.

(9)  Sales to Major Customers
     ------------------------

During the year ended June 30, 2006,  the eleven  months ended June 30, 2005 and
the year ended July 31,  2004 no customer  accounted  for more than 10% of total
revenues.

(10) Supplementary Information
     -------------------------

                                                  2006       2005         2004
                                                  ----       ----         ----

Advertising costs                               $41,765     15,249      17,590
Provision for doubtful accounts                   8,400      7,700       8,400

The  provision  for  doubtful  accounts  and  advertising  costs are included in
selling,  general and  administrative  costs in the  accompanying  statements of
operations.

(11) Non-Operating Expense
     ---------------------
Other non-operating  expense,  net, for the year ended June 30, 2006, the eleven
months  ended June 30, 2005 and the year ended July 31, 2004 is comprised of the
following:

                                                  2006       2005         2004
                                                  ----       ----         ----

 Loss on disposition of fixed assets          $      -           -     (10,330)
                                              ----------    -------  -----------

                                              $      -           -     (10,330)
                                              ==========    =======  ===========



                                      F-20
<PAGE>
                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005

(12) Selected Financial Data (Unaudited)
     -----------------------------------

The following is a summary of the quarterly  results of operations  for the year
ended June 30,  2006,  the eleven  months ended June 30, 2005 and the year ended
July 31, 2004, respectively:
<TABLE>
<CAPTION>
<S>                                            <C>               <C>               <C>              <C>              <C>

                                            Quarter ended    Quarter ended    Quarter ended    Quarter ended     Year ended
                                            September 30,    December 31,     March 31,        June 30,          June 30,
                                            --------------   -------------    --------------   --------------    -------------
                  2006
                  ----
Net revenues                                $    2,286,353       2,245,279         2,617,641        2,575,159        9,724,432
Net income                                         164,554         180,674           218,054          162,554          725,836
Basic earnings per share                              0.63            0.69              0.84             0.63             2.79
Weighted-average number of
   shares issued and outstanding                   260,629         260,100           259,857          257,543          260,109


                                                                                               Two Months        Eleven Months
                                            Quarter ended    Quarter ended    Quarter ended    ended             ended
                                            October 31,      January 31,      April 30,        June 30,          June 30,
                                            --------------   -------------    --------------   --------------    -------------
                  2005
                  ----
Net revenues                                $    1,965,739       1,985,775         2,026,846        1,339,340        7,317,700
Net income                                         178,479         131,895           112,186          111,319          533,879
Basic earnings per share                              0.67            0.50              0.42             0.43             2.02
Weighted-average number of
   shares issued and outstanding                   266,181         266,075           264,688          261,960          264,843

                                            Quarter ended    Quarter ended    Quarter ended    Quarter ended     Year ended
                                            October 31,      January 31,      April 30,        July 31,          July 31,
                                            --------------   -------------    --------------   --------------    -------------
                  2004
                  ----
Net revenues                                     2,108,438       1,893,663         2,044,975        1,949,537        7,996,613
Net income                                         134,965         113,445            79,758          126,034          454,202
Basic earnings per share                              0.51            0.43              0.30             0.46             1.70
Weighted-average number of
   shares issued and outstanding                   267,003         266,461           266,313          266,221          266,552

</TABLE>

                                      F-21
<PAGE>
                               TNR TECHNICAL, INC.

                          Notes to Financial Statements

                             June 30, 2006 and 2005




(12) Selected Financial Data (Unaudited) - Continued
     -----------------------------------------------

Unaudited Results of Operations

The following is a presentation of the unaudited results of operations for the
eleven months ended June 30, 2004:

     Revenues:
         Net Sales                                          $       7,350,679
                                                            -----------------
     Cost and expenses:
         Cost of goods sold                                         5,333,382
         Selling, general and administrative                        1,357,438
                                                            -----------------

                                                                    6,690,820
                                                            -----------------
              Operating income                                        659,859

     Non-operating revenue (expense):
         Interest income                                                1,153
         Investment gains, net                                         24,301
         Other, net                                                    (3,173)
                                                            -----------------
              Income before income taxes                              682,140

     Income tax expense                                               265,256
                                                            -----------------

              Net income                                    $         416,884
                                                            =================




                                      F-22

<PAGE>
Item 8.  Changes  in  and  Disagreements  with  Accountants  on  Accounting  and
         Financial Disclosure.
-------  -----------------------------------------------------------------------

           None.

Item 8(a) Controls and Procedures
--------  -----------------------

     The Company maintains  disclosure controls and procedures that are designed
to ensure that  information  required to be disclosed in the Company's  Exchange
Act reports is recorded,  processed,  summarized  and  reported  within the time
periods  specified in the SEC's rules and forms,  and that such  information  is
accumulated and  communicated to the Company's  management,  including its Chief
Executive Officer and Chief Financial Officer,  as appropriate,  to allow timely
decisions  regarding  required  disclosure  based  closely on the  definition of
"disclosure  controls  and  procedures"  in Rule  13a-15(e).  In  designing  and
evaluating the disclosure  controls and procedures,  management  recognized that
any controls and  procedures,  no matter how well  designed  and  operated,  can
provide only reasonable  assurance of achieving the desired control  objectives,
and management  necessarily was required to apply its judgment in evaluating the
cost-benefit  relationship  of possible  controls  and  procedures.  The Company
carried out an evaluation,  under the supervision and with the  participation of
the Company's  management,  including the Company's Chief Executive  Officer and
the Company's Chief Financial  Officer,  of the  effectiveness of the design and
operation of the  Company's  disclosure  controls and  procedures.  Based on the
foregoing,  the Company's  Chief Executive  Officer and Chief Financial  Officer
concluded that the Company's  disclosure  controls and procedures were effective
at the  reasonable  assurance  level at the end of our most  recent  fiscal year
ended June 30,  2006.  There have been no  changes in the  Company's  disclosure
controls and  procedures  or in other  factors that could affect the  disclosure
controls subsequent to the date the Company completed its evaluation.

     Management  has  not  yet  completed,  and  is not  yet  required  to  have
completed,  its  assessment  of  the  effectiveness  of  internal  control  over
financial reporting as required by Section 404 of the Sarbanes-Oxley Act.

Item 8(b)  Other Information
--------   -----------------

           None.



                                       14
<PAGE>
                                    PART III

Item 9.  Directors,    Executive   Officers,   Promoters   and  Control Persons;
         Compliance with Section 16(a) of the Exchange Act.
--------------------------------------------------------------------------------

              The   names,  ages  and  principal  occupations  of the  Company's
         present   directors,  and  the  date on  which  their  term  of  office
         commenced and expires, are listed below.

                                  Term       First
                                   of       Became      Principal
   Name                 Age      Office    Director     Occupation
   ----                 ---      ------    --------     ----------

   Wayne Thaw            49       (1)        1983      Chairman of the
                                                       Board, Chief
                                                       Executive Officer
                                                       President

   Jerrold Lazarus       74       (1)        1987      Retired

   Norman L. Thaw        73       (1)        1979      President of
                                                       Stride Rite
                                                       Stables, Inc.,
                                                       Private Investor

   Mitchell Thaw         50       (1)        1998      Investor

   Patrick Hoscoe        43       (1)        1998      Vice President
                                                       And Operations
                                                       Manager of the
                                                       Company's West
                                                       Coast Division

   Larry J. Kaczmarek    44       (1)        2004      Colonial Management Group
                                                       Controller/Chief
                                                       Executive Officer

   Anthony Guadagnino    59       (1)        2004      President of
                                                       Presidential South,
                                                       Inc.
     ---------
     (1)  Directors are elected at the annual meeting of  stockholders  and hold
          office until the following annual meeting.



                                       15
<PAGE>
Officers of the Company
-----------------------

     Wayne  Thaw is  Chairman  of the  Board,  Chief  Executive  Officer,  Chief
Financial Officer, President and Treasurer of the Company. Patrick Hoscoe serves
as Vice  President  of the  Company.  Kathie  Thaw  serves as  Secretary  of the
Company.  The terms of all  officers  expire at the annual  meeting of directors
following the annual stockholders meeting. Officers serve at the pleasure of the
Board  and may be  removed,  either  with or  without  cause,  by the  Board  of
Directors, and a successor elected by a majority vote of the Board of Directors,
at any time.

Biographical Information
------------------------

     Wayne Thaw has served as Chairman of the Board and Chief Executive  officer
since  December 2000 and President  and Chief  Operating  Officer of the Company
since November 1987. Mr. Thaw has been a full-time employee since 1980.

     Jerrold Lazarus has served as a director of the Company since October 1987.
Mr.  Lazarus  was a full  time  employee  and  Chairman  of the  Board and Chief
Executive  Officer of the Company between  October 1987 and January 2001.  Since
Mr.  Lazarus  retired  from  serving as an  executive  officer of the Company in
January 2001, he has not been affiliated with another company.

     Norman L. Thaw is one of the  founders  of the  Company  and  served as its
Chairman and Chief Executive Officer between March 1987 and April 1988. For more
than five years, Mr. Thaw's principal occupation is the President of Stride Rite
Stables, Inc., a thoroughbred racing and breeding farm in South Florida.

     Mitchell Thaw has been a director of the Company since  December  1998. Mr.
Thaw is a private  investor and he is not currently  affiliated  with any firms.
For over 25 years, Mr. Thaw has been engaged in numerous Wall Street trading and
management  positions.  Mr. Thaw has expertise  and  experience in numerous Wall
Street  products,   options,  structured  products,  stocks,  warrants,  program
trading,  convertible  bonds,  corporate and government bonds.  Between 2002 and
2006, he was the co-founder and co-manager of the Harbert Convertible  Arbitrage
Fund. The fund's primary  strategy was capital  structure  arbitrage and grew to
over $900,000,000 in assets.  Prior to joining Harbert,  Mr. Thaw specialized in
listed  equity  options and  structured  products.  He started an  institutional
option department at KBC Securities,  an international  firm, where he served as
vice  president  from  November  2000  until   September  2001.  He  started  an
institutional  option  department  at  Schroeder  & Co.,  Inc.  and  served as a
director of Institutional Options at Schroeder from April 1999 through May 2000.
From 1988 through April 1998, Mr. Thaw was an executive for UBS Securities.  Mr.
Thaw received a BA from the University of Miami.

     Patrick  Hoscoe has been Vice President and a director of the Company since
1998.  Mr. Hoscoe also serves as Operations  Manager of the Company's West Coast
operations.  Mr.  Hoscoe has 26 years  experience  in the battery  industry  and
worked for House of Batteries for the five years prior to joining the Company in
1997.

                                       16
<PAGE>
     Larry J. Kaczmarek,  since May 2006, has been  Controller/CFO  for Colonial
Management  Group,  L.P.,  one of the  largest  operators  of  opiate  addiction
substance  abuse  treatment  centers in the nation.  He is  responsible  for all
accounting and finance  functions and supervises a staff of four.  Between March
2005 and May 2005, he served as a senior  financial  consultant for  CuraScript,
Inc., a large  specialty  pharmacy  distributor.  He led  important  projects in
Sarbanes Oxley compliance and accounts  receivable.  Between  September 2004 and
March 2005 he served as  Director  of Finance of  Devereux  Florida,  one of the
largest not for profit  organizations  in central  Florida,  serving as a mental
health service provider for young children throughout Florida.  Between February
and  August,  2004,  Mr.  Kaczmarek  was self  employed  and  served as a senior
financial  consultant  to his clients.  Between  April 2000 and January 2003, he
served as Chief  Financial  Officer of  Protegrity  Holdings,  Inc., a mid-sized
company  specializing in  administration of workers'  compensation  insurance in
Longwood,  Florida.  As Chief Financial Officer, he supervised a staff of twelve
persons and was responsible for all financial and accounting  functions,  served
as lead contact with the bank as to its credit facility, was responsible for all
risk management  needs,  served as lead  negotiator  relating to certain service
contracts and  developed  and  implemented  specialized  financial  reports that
provided  the chief  executive  officer and product  line  leaders  with current
results and run rate trends.  From 1997 to April 2000,  he served as director of
workers' compensation for Humana Inc. of Louisville,  Kentucky. Between 1995 and
1997, he served as director of finance at Humana Inc.  Between 1990 - 1995,  Mr.
Kaczmarek  served as director of  financial  analysis  and  planning at Emphesys
Financial  Group,  Inc., Green Bay,  Wisconsin.  He has a Bachelor of Science in
Public Finance from Indiana University, which he received in 1984.

     Anthony  Guadagnino  has been  President  and owner of  Presidential  Group
South,  Inc.  since  1985.  Presidential  Group  South is a property  management
company  servicing the needs of Central  Florida.  Presidential  Group South has
managed various real estate  properties in Orange,  Seminole and Volusia County,
including   single  family  homes,   condominium  and  homeowners   association,
commercial and residential real estate buildings  amounting to over 4,000 units.
Mr. Guadagnino is a licensed broker and certified  association  manager.  He has
been licensed in Maryland, Virginia and Washington, D.C. Mr. Guadagnino has been
in  property  management  since  1975  and  has  developed  condominiums  in the
Washington  D.C.  area.  He has also  served as a senior  accountant  at Eisen &
Lubin,  a New York City CPA firm,  where he was in charge of various real estate
and retail  client  audits for major clients from 1969 to 1972. He is a graduate
of the City  College  of New York,  Bernard  Baruch  School of  Business  with a
Bachelor of Science in Business Administration majoring in Accounting.

                                       17
<PAGE>
Family Relationships
--------------------

     Norman L. Thaw is the father of Wayne Thaw and  Mitchell  Thaw.  Wayne Thaw
and Kathie Thaw are married.

Compliance with Section 16(a) of the Securities Exchange Act of 1934
--------------------------------------------------------------------

     Section 16(a) of the Securities Exchange Act of 1934, as amended,  requires
the Company's officers and directors,  and persons who own more than ten percent
of a registered  class of the Company's  equity  securities,  to file reports of
ownership and changes in ownership with the  Securities and Exchange  Commission
(the   "Commission").   Officers,   directors   and  greater  than  ten  percent
stockholders are required by the Commission's regulations to furnish the Company
with  copies of all Section  16(a)  forms they file.  During year ended June 30,
2006, no officers,  directors or greater than 10%  stockholders  filed any forms
late,  except that a Form 4 for Mitchell  Thaw was timely filed on June 27, 2006
inadvertently  using the Edgar codes of Wayne Thaw and was later correctly filed
after its due date.

Audit Committee / Lack of Other Committees
------------------------------------------

     The Company has no standing  nominating and compensation  committees of the
Board of Directors or committees performing similar functions.  In January 2005,
the Company formed our Audit  Committee of its Board of Directors  consisting of
Larry  J.  Kaczmarek  and  Anthony  Guadagnino  as  independent  directors.   An
independent  director  is defined  in Rule  4200(a)(14)  of the  NASD's  Listing
Standards  to mean a person  other than an officer or employee of the Company or
its  subsidiaries or any other  individual  having a relationship  which, in the
opinion of the Company's  Board of Directors,  would interfere with the exercise
of independent judgment in carrying out the responsibilities of a director.  The
following persons should not be considered independent:

  o    A director  who is employed by the Company or any of its  affiliates  for
the current year or any of the past three years;
  o    A director  who accepts any  compensation  from the Company or any of its
affiliates  in excess of $60,000  during  the  previous  fiscal  year other than
compensation for Board service,  benefits under a tax qualified retirement plan,
or non discretionary compensation;
  o    A director who is a member of the immediate  family of an individual  who
is, or has been in any of the past three  years,  employed by the Company or any
of its affiliates as an executive officer.  Immediate family includes a person's
spouse,   parents,    children,    siblings,    mother-in-law,    father-in-law,
sister-in-law,  brother-in-law,  son-in-law,  daughter-in-law,  and  anyone  who
resides in such person's home;
  o    A  director  who is a partner  in,  or a  controlling  shareholder  or an
executive officer of, any for-profit business  organization to which the Company
made,  or from which the Company  received,  payments  (other than those arising
solely  from  investments  in the  Company's  securities)  that exceed 5% of the
Company's or business  organizations  consolidated gross revenues for that year,
or $200,000, whichever is more, in any of the past three years;
  o    A director who is employed as an executive of another entity where any of
the Company's executives serve on that entity's compensation committee.

                                       18
<PAGE>
     Mr.  Kaczmarek may be deemed to be a "Financial  Expert" within the meaning
of  Sarbanes-Oxley  Act of 2002,  as  amended.  The term  "Financial  Expert" is
defined  as a person  who has the  following  attributes:  an  understanding  of
generally  accepted  accounting  principles  and financial  statements;  has the
ability to assess the general  application of such principles in connection with
the  accounting  for  estimates,  accruals and reserves;  experience  preparing,
auditing,  analyzing or evaluating  financial  statements that present a breadth
and level of complexity of  accounting  issues that are generally  comparable to
the  breadth and  complexity  of issues  that can  reasonably  be expected to be
raised by the Company's financial statements, or experience actively supervising
one or more persons engaged in such  activities;  an  understanding  of internal
controls and procedures for financial  reporting;  and an understanding of audit
committee functions.

     In January  2005, a written  charter for the Audit  Committee  was adopted.
Such charter includes, among other things, the following:

     o    annually  reviewing and  reassessing  the adequacy of the  committee's
          formal charter;
     o    reviewing the annual audited  financial  statements with the Company's
          management  and  its  independent  auditors  and the  adequacy  of its
          internal accounting controls;
     o    reviewing   analyses   prepared  by  the  Company's   management   and
          independent auditors concerning significant financial reporting issues
          and judgments made in connection with the preparation of its financial
          statements;
     o    being  directly  responsible  for the  appointment,  compensation  and
          oversight of the independent  auditor,  which shall report directly to
          the Audit Committee,  including  resolution of  disagreements  between
          management  and the auditors  regarding  financial  reporting  for the
          purpose of preparing or issuing an audit report or related work;
     o    reviewing the independence of the independent auditors;
     o    reviewing  the  Company's  auditing  and  accounting   principles  and
          practices with the independent auditors and reviewing major changes to
          its auditing and  accounting  principles and practices as suggested by
          the independent auditor or its management;
     o    reviewing  all  related  party  transactions  on an ongoing  basis for
          potential conflict of interest situations; and
     o    all  responsibilities  given to the Audit  Committee  by virtue of the
          Sarbanes-Oxley  Act of 2002,  which was signed  into law by  President
          George W. Bush on July 30, 2002.

Code of Ethics
--------------

     Effective  March 3, 2003,  the  Securities & Exchange  Commission  requires
registrants  like the Company to either  adopt a code of ethics that  applies to
the Company's Chief Executive Officer and Chief Financial Officer or explain why
the Company has not adopted  such a code of ethics.  For purposes of item 406 of
Regulation  S-K,  the term "code of ethics"  means  written  standards  that are
reasonably designed to deter wrongdoing and to promote:

     o    Honest and ethical  conduct,  including the ethical handling of actual
          or apparent  conflicts of interest  between  personal and professional
          relationships;
     o    Full, fair, accurate,  timely and understandable disclosure in reports
          and  documents  that the  Company  files  with,  or  submits  to,  the
          Securities & Exchange  Commission  and in other public  communications
          made by the Company;
     o    Compliance with applicable governmental law, rules and regulations;
     o    The  prompt  internal  reporting  of  violations  of  the  code  to an
          appropriate person or persons identified in the code; and
     o    Accountability for adherence to the code.

     In September  2005, the Company adopted a Code of Ethics which was filed as
Exhibit  14.1 to its Form 10-K for its  fiscal  year  ended  June 30,  2005.  No
changes have been made to the Code of Ethics.



                                       19
<PAGE>
Item 10.  Executive Compensation.
          ----------------------

         The following table provides a three-year summary compensation table
with respect to the Company's Chief Executive Officer and any executive officers
earning salaries and bonuses of $100,000 or more during the year ended June 30,
2006. During the past three fiscal years, the Company has not granted restricted
stock awards or stock appreciation rights. In addition, the Company does not
have a defined benefit or actuarial plan.
<TABLE>
<CAPTION>
                           SUMMARY COMPENSATION TABLE
-----------------------------------------------------------------------------------------------------------------------------------

                                                                                      Long Term Compensation
--------------------------------------------------------------------------  ----------------------------- ------------ ------------

                                Annual Compensation                                            Awards          Payouts
------------------- ----------- --------------- ------------- -------------- -------------- -------------- ------------ ------------
      (a)              (b)            (c)             (d)           (e)            (f)           (g)            (h)         (i)

                                                                   Other
     Name                                                          Annual     Restricted                                    All
     And                                                           Compen-       Stock          Number        LTIP         Other
     Principal                                                     sation      Award(s)           of           Payout   Compensation
     Position         Year         Salary ($)       Bonus ($)      ($)(1)         ($)           Options          ($)         ($)
------------------- ----------- --------------- ------------- -------------- -------------- -------------- ------------ ------------
<S>                    <C>         <C>             <C>           <C>               <C>         <C>              <C>           <C>
Wayne Thaw, CEO,
President              2006        $208,540        $33,615       $3,848(2)         0           10,000           0             0
                    ----------- --------------- ------------- -------------- -------------- -------------- ------------ ------------
                       2005         184,680           0             0              0              0             0             0
                    ----------- --------------- ------------- -------------- -------------- -------------- ------------ ------------
                       2004         199,105         27,350        7,695(2)         0              0             0             0
------------------- ----------- --------------- ------------- -------------- -------------- -------------- ------------ ------------
Patrick Hoscoe,        2006         127,120        $37,260          0              0              0             0             0
Vice President
                    ----------- --------------- ------------- -------------- -------------- -------------- ------------ ------------
                       2005         100,032         20,820          0              0              0             0             0
                    ----------- --------------- ------------- -------------- -------------- -------------- ------------ ------------
                       2004         104,540         26,520          0              0              0             0             0
------------------- ----------- --------------- ------------- -------------- -------------- -------------- ------------ ------------
</TABLE>
(1)  Does not include the value of a leased or company owned automobile provided
     to the CEO for business purposes.
(2)  For fiscal  2004 and  fiscal  2006  $7,695 and $3,848  were paid in lieu of
     vacation pay respectively.



                                       20
<PAGE>
     The Company has no employment contracts with its executive officers.  Wayne
Thaw  currently  receives an annual salary of $220,000  plus such  increases and
bonuses as determined  by the Board of Directors.  The Company also pays for the
cost of gasoline,  repairs and insurance  related to an automobile  purchased by
the Company for Mr.  Wayne  Thaw's use.  Patrick  Hoscoe  currently  receives an
annual  salary of $130,000  plus such  increases as  determined by the Company's
Board of Directors.

     Directors,   who  are  executive   officers,   do  not  presently   receive
compensation  for serving on the Board or on its  committees.  Directors who are
not serving as executive  officers  receive  modest cash fees for  attendance at
board meetings and committee  meetings and are eligible to receive stock options
at the discretion of the Board.

     The Company  leases its employees from a  non-affiliated  company which has
established  a 401(k)  plan  pursuant to which the  Company  matches  employees'
contributions of an amount equal to $1.00 per employee's  contributed  dollar up
to a maximum  matching  contribution of six percent of the  compensation of each
respective  employee.  The Company has no other annuity,  pension, or retirement
benefits  for its  employees.  Except as described  herein,  the Company has not
afforded any of its officers or directors any other personal benefits, the value
of which exceeds 10% of his cash compensation,  which is not directly related to
job performance or provided generally to all salaried employees.

Stock Option Plans
------------------

The 1992 Plan
-------------

     The 1992 Incentive and Non-Qualified  Stock Option Plan, (the "1992 Plan"),
was  approved by the Board of  Directors  on November  17, 1992 and  ratified by
stockholders  on January 29, 1993. The 1992 Plan covered 60,000 shares of Common
Stock, subject to adjustment of shares under the anti-dilution provisions of the
1992 Plan. The 1992 Plan  authorizes the issuance of the options covered thereby
as either  "Incentive  Stock Options" within the meaning of the Internal Revenue
Code of 1986, as amended, or as "Non-Statutory  Stock Options." Persons eligible
to receive options under the 1992 Plan included employees,  directors, officers,
consultants  or advisors,  provided that bona fide services shall be rendered by
consultants  or advisors and such services  must not be in  connection  with the
offer or sale of  securities in a capital  raising  transaction;  however,  only
employees (who may also be officers  and/or  directors) were eligible to receive
an Incentive  Stock  Option.  The 1992 Plan also provided that no options may be
granted after November 16, 2002. In December 1996, the Company  granted ten year
non-statutory  options to purchase  30,000 shares at an exercise  price of $3.25
per share to Wayne Thaw (10,000  shares),  Jerrold  Lazarus  (10,000 shares) and
Kathie Thaw (10,000  shares).  In December  1998,  the Company  granted ten year
non-statutory  stock  options to purchase  7,000 shares at an exercise  price of
$5.00 per share to Jerrold Lazarus (2,000 shares), Wayne Thaw (3,000 shares) and
Patrick Hoscoe (2,000 shares).  In December 2001, the Company granted Wayne Thaw
10-year  Non-Statutory  Stock Options to purchase 23,000 shares of the Company's
Common  Stock at an exercise  price of $6.80 per share.  In April 2002,  Jerrold
Lazarus exercised his options to purchase 12,000 shares. Accordingly, all 60,000
options  have been  granted  under the 1992 Plan with 48,000  options  remaining
outstanding and 12,000 options having been exercised.

                                       21
<PAGE>
     The 1992 Plan is  administered  by the  Company's  Board of  Directors or a
stock option  committee  consisting  of three members of the Board which has the
authority to determine the persons to whom options shall be granted, whether any
particular  option shall be an Incentive Option or a Non-Statutory  Option,  the
number  of  shares  to be  covered  by each  option,  the time or times at which
options will be granted or may be exercised  and the other terms and  provisions
of the Options.

     Under the 1992 Plan,  the aggregate  fair market value  (determined  at the
time the option is  granted) of the  optioned  stock for which  Incentive  Stock
Options are  exercisable  for the first time by any employee during any calendar
year  (under all such Plans of the  individual's  Employer  Corporation  and its
parent and subsidiary corporation) shall not exceed $100,000.

     The 1992 Plan also provided that the Board of directors shall determine the
exercise  price of the  Common  Stock  under  each  option.  The 1992  Plan also
provided  that:  (i) the  exercise  price of  Incentive  Stock  Options  granted
there-under  shall not be less than 100% (110% if the optionee  owns 10% or more
of the outstanding voting securities of the Company) of the fair market value of
such shares on the date of grant,  as determined by the Board or Committee,  and
(ii) no option by its terms may be exercised  more than ten years (five years in
the case of an Incentive  Stock  Option,  where the optionee owns 10% or more of
the outstanding  voting  securities of the Company) after the date of grant. All
Stock  Options  are  non-transferable  except by will or the laws of descent and
distribution.

The 1998 Plan
-------------

     The 1998 Incentive and Non-Qualified  Stock Option Plan, (the "1998 Plan"),
was  approved by the Board of Directors  effective  December 15, 1998 subject to
stockholder approval within 12 months. The 1998 Plan, as amended by stockholders
in December 2003, covers 60,000 shares of Common Stock, subject to adjustment of
shares  under  the  anti-dilution  provisions  of the 1998  Plan.  The 1998 Plan
authorizes  the  issuance of the options  covered  thereby as either  "Incentive
Stock  Options"  within the meaning of the  Internal  Revenue  Code of 1986,  as
amended,  or as  "Non-Statutory  Stock  Options."  Persons  eligible  to receive
options under the 1998 Plan includes employees, directors, officers, consultants
or advisors,  provided that bona fide services  shall be rendered by consultants
or advisors and such services  must not be in connection  with the offer or sale
of securities in a capital raising transaction; however, only employees (who may
also be officers  and/or  directors) are eligible to receive an Incentive  Stock
Option.  The 1998  Plan also  provides  that no  options  may be  granted  after
December 15, 2008.  Except for the foregoing,  the 1998 Plan is identical to the
1992 Plan.  Ten-year  Non-Statutory  Stock  Options  to  purchase  5,000  shares
exercisable  at $21.00 per share were  granted to Wayne Thaw in August  2005 and
10-year  Non-Statutory  Stock Options to purchase  5,000 shares  exercisable  at
$22.60 were granted to Wayne Thaw in January  2006.  No other  options have been
granted under the 1998 Plan.



                                       22
<PAGE>
                               OPTION GRANTS TABLE

     The  information  provided in the table  below  provides  information  with
respect to individual  grants of stock options during the fiscal year ended June
30, 2006 of each of the  executive  officers  named in the summary  compensation
table  above.  The Company did not grant any stock  appreciation  rights  during
2006.
<TABLE>
<CAPTION>
                        Option Grants in Last Fiscal Year

------------------------------------------------------------------------------------------------------------------------------------
                                                                                                        Potential
                                       Individual Grants                                            Realizable Value at
                                                                                                      Assumed Annual
                                                                                              Rates of Stock Price Appreciation
                                                                                                    for Option Term (2)
----------------------- ---------------- ---------------- ----------------- -------------- -----------------------------------------
          (a)                 (b)              (c)              (d)              (e)            (f)                 (g)

                                                % of
                                               Total
                                              Options/
                                             Granted to
                             Options         Employees         Exercise
                             Granted         in Fiscal          Price        Expiration
        Name                   (#)            Year (1)          ($/Sh)          Date            5% ($)               10% ($)
----------------------- ---------------- ---------------- ----------------- -------------- ----------------- -----------------------
<S>                           <C>                <C>            <C>             <C>  <C>        <C>                  <C>
Wayne Thaw                    5,000              50             22.60           1-30-16         71,050               180,050
                              5,000              50             21.00           8-17-15         66,000               167,350
----------------------- ---------------- ---------------- ----------------- -------------- ----------------- -----------------------
Patrick Hoscoe                  0                0               N/A              N/A            N/A                  N/A
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
N/A - Not Applicable.
-------------
(1)  The  percentage  of total  options  granted to  employees in fiscal year is
     based upon options granted to officers, directors and employees.

(2)  The potential  realizable  value of each grant of options  assumes that the
     market price of the Company's  Common Stock  appreciates  in value from the
     date of grant to the end of the option term at  annualized  rates of 5% and
     10%,  respectively,  and after  subtracting  the  exercise  price  from the
     potential realizable value.


                                       23
<PAGE>
     AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
     AND FY-END OPTION VALUES

          The information  provided in the table below provides information with
     respect to each  exercise of stock option during the fiscal year ended June
     30,  2006  by  each  of  the  executive   officers  named  in  the  summary
     compensation table and the fiscal year end value of unexercised options.

--------------------------------------------------------------------------------
       (a)          (b)             (c)           (d)              (e)
                                                                Value
                                                                of
                                               Number of        Unexercised
                                               Unexercised      In-the-Money
                                               Options at       Options
                   Shares          Value       FY-End (#)       at Fy-End($)
                   Acquired on     Realized    Exercisable/     Exercisable/
       Name        Exercise (#)    ($)(1)      Unexercisable    Unexercisable(1)
------------------ -------------- ----------- ---------------- -----------------
Wayne Thaw (2)          -0-            -0-          56,000/0   1,087,600 / -0-
------------------ -------------- ----------- ---------------- -----------------
Patrick Hoscoe          -0-            -0-           2,000/0      48,700 / -0-
------------------ -------------- ----------- ---------------- -----------------

(1)  The  aggregate  dollar  values  in column  (c)?and  (e) are  calculated  by
     determining  the  difference  between the fair  market  value of the Common
     Stock  underlying  the  options  and the  exercise  price of the options at
     exercise or fiscal year end, respectively.  In calculating the dollar value
     realized upon  exercise,  the value of any payment of the exercise price is
     not included. Fiscal year end value based upon a market price of $27.50 per
     share  determined  as of the close of business on June 29,  2006,  the last
     trade before the end of our fiscal year on June 30, 2005.

(2)  Includes options to purchase 10,000 shares held by his wife, Kathie Thaw.

Report of the Board of Directors on Executive Compensation
----------------------------------------------------------

     During the fiscal year ended June 30,  2006,  the entire Board held primary
responsibility for determining  executive  compensation levels. The goals of the
Company's compensation program is to align compensation with business objectives
and  performance  and to enable  the  Company  to  attract,  retain  and  reward
executive  officers and other key  employees  who  contribute  to the  long-term
success of the Company.  The Company has provided on a prospective  basis annual
incentive  opportunity  to several of its key  employees  sufficient  to provide
motivation to achieve  specific  operating  goals. The foregoing report has been
approved by all members of the board of directors.

                                Wayne Thaw -Chairman
                                Jerrold Lazarus
                                Norman Thaw
                                Mitchell Thaw
                                Patrick Hoscoe
                                Larry Kaczmarek
                                Anthony Guadagnino


                                       24
<PAGE>
Compensation Committee Interlocks and Insider Participation
-----------------------------------------------------------

     During the fiscal year ended June 30, 2006,  Wayne Thaw and Patrick Hoscoe,
each an executive officer of the Company, was involved in determining  executive
officer compensation levels as a member of the Board of Directors.

Item 12. Security  Ownership  of  Certain  Beneficial  Owners and Management and
         Related Stockholder Matters.

     As of August 31, 2006, the Company had outstanding 259,877 shares of Common
Stock.  The only  persons of record who  presently  hold or are known to own (or
believed by the  Company to own)  beneficially  more than 5% of the  outstanding
shares of such class of stock is listed  below.  The  following  table also sets
forth certain  information  as to holdings of the Company's  Common Stock of all
officers and directors individually,  and all officers and directors as a group.
The shares shown in the table below for Norman Thaw and his sons, Wayne Thaw and
Mitchell  Thaw  are  not  beneficially  owned  by  each  other  and  are  listed
separately.


   -------------- --------------------------------- ------------ ---------------
                       Name and  Address of           Number of    Approximate
   Title of Class      Beneficial  Owner (1)          Shares       Percent
   -------------- --------------------------------- ------------ ---------------

   Common Stock   Wayne Thaw and Kathie Thaw (3)(6)   103,270            39
   -------------- --------------------------------- ------------ ---------------

   Common Stock   Norman L. Thaw (2)(6)(7)             55,229            21.3
   -------------- --------------------------------- ------------ ---------------

   Common Stock   Jerrold Lazarus                        -0-             -0-
   -------------- --------------------------------- ------------ ---------------

   Common Stock   Patrick Hoscoe (4)                    2,000              .8
   -------------- --------------------------------- ------------ ---------------

   Common Stock   Mitchell A. Thaw (6)                 31,025            11.9
   -------------- --------------------------------- ------------ ---------------

   Common Stock   Larry J. Kaczmarek                     -0-             -0-
   -------------- --------------------------------- ------------ ---------------

   Common Stock   Anthony Guadagnino                     -0-             -0-
   -------------- --------------------------------- ------------ ---------------

   Common Stock   All Directors and Officers as a
                  Group (7 persons) (5)               191,524            73
   -------------- --------------------------------- ------------ ---------------

(1)  All shares are directly owned,  and the sole investment and voting power is
     held, by the persons  named.  The address for all officers and directors is
     301 Central Park Drive, Sanford, Florida 32771.

(2)  May be  deemed  to be a parent  and/or  founder  of the  Company  under the
     Securities  Act of 1933,  as  amended  and may be deemed  to be a  "control
     person" of the Company within the meaning of the Securities Exchange Act of
     1934.

(3)  Includes  options  to  purchase  46,000  shares  granted  to Wayne Thaw and
     options to purchase 10,000 shares granted to Kathie Thaw.

(4)  Consists of options to purchase 2,000 shares.

(5)  Includes options to purchase 58,000 shares.

(6)  Wayne Thaw and Kathie Thaw are married and their individual stock ownership
     which is in a family trust for their benefit is shown jointly.  Norman Thaw
     is the father of Wayne Thaw and Mitchell A. Thaw.

(7)  Norman Thaw's stock ownership is in a revocable trust.


     The Company does not know of any arrangement or pledge of its securities by
persons now  considered  in control of the Company that might result in a change
of control of the Company.

                                       25
<PAGE>
Equity Compensation Plan
------------------------

     The  following  summary  information  relates  to  our  Compensation  Plans
described in Item 11 pursuant to which we have  granted  options to purchase our
Common Stock with the  information  set forth in the table as of the filing date
of this Form 10-KSB:

<TABLE>
<CAPTION>
<S>                         <C>                      <C>                 <C>
--------------------- ------------------------- ------------------ ------------------------
                               (a)                   (b)                   (c)
--------------------- ------------------------- ------------------ ------------------------
Plan category         Number of securities to   Weighted average   Number of securities
                      be issued upon exercise   exercise price of  remaining available for
                      of outstanding options    outstanding        future issuance under
                                                options (1)        equity compensation plan
                                                                   (excluding securities
                                                                   reflected in column (a))
--------------------- ------------------------- ------------------ ------------------------
Equity compensation
Plans approved by
Security Holders                 58,000                  8.00                   50,000
--------------------- ------------------------- ------------------ ------------------------
</TABLE>
---------------------
(1)  Based upon 20,000 options  exercisable  at $3.25 per share,  23,000 options
     exercisable  at $6.80 per share,  5,000  options  exercisable  at $5.00 per
     share,  5,000  options  exercisable  at $21.00 per share and 5,000  options
     exercisable at $22.60 per share.

Item 12. Certain Relationships and Related Transactions.
-------  -----------------------------------------------

     See Item 2 regarding the description of lease between the Company and a RKW
Holding Ltd. ("RKW"), a Florida Limited  Partnership,  controlled by Wayne Thaw.
For the fiscal year ended 2006 and the eleven months ended June 30, 2005 and the
fiscal years ended July 31, 2004, 2003, 2002, 2001 and 2000,  $99,595,  $87,053,
$90,785, $88,462, $85,345, $78,424, $74,690 and $71,133, respectively, were paid
by the Company to RKW, which amount will increase by  approximately  4% for each
new contract year, which begins on June 1st of each year. The foregoing  amounts
paid to RKW do not include insurance  reimbursement of approximately  $2,000 per
year and property taxes paid of approximately $9,500 per year.

                                       26
<PAGE>
Item 13. Exhibits
-------  --------

         3            Certificate of Incorporation and Amendments thereto. (1)

         3(A)         By-Laws. (1)

         3(B)         February  1992 Certificate of Amendment to  Certificate of
                      Incorporation (2)

         10           Lease Agreement dated January 17, 1996 by and between  RKW
                      Holding Ltd. and the Registrant (3)

         10.1         Amended lease with RKW Holdings Ltd. (5)

         11           Earnings per share.  See Financial Statements

         14.1         Code of Ethics and Code of Conduct (6)

         31           Chief Executive Officer and Chief Financial  Officer  Rule
                      13a- 14(a)/15d-14(a) Certification (*)

         32           Chief  Executive  Officer  and  Chief  Financial   Officer
                      Section 1350 Certification (*)

         99           1998 Incentive and Non-Statutory Stock Option Plan (4)

         99.1         Amendment to 1998 Incentive and Non-Statutory Stock Option
                      Plan (6)

         -------------
         * Filed herewith.
         (1) Exhibits 3 and 3(A) are incorporated by reference from Registration
             No. 2-85110 which were filed in a Registration Statement  on  Form
             S-18.
         (2) Incorporated by reference to Form 10-K for the  fiscal  year  ended
             July 31, 1992.
         (3) Incorporated by  reference  to  Form 10-K for the fiscal year ended
             July 31, 1996.
         (4) Incorporated by reference to Form 10-K for the  fiscal  year  ended
             July 31, 1999.
         (5) Incorporated by reference to  Form 8-K dated June 8, 2005 filed for
             June 1, 2005 - date of earliest event.
         (6) Incorporated by reference to Form 10-K for the  fiscal  year  ended
             June 30, 2005.



                                       27
<PAGE>
Item 14. Principal Accountant Fees and Services

Audit Fees
----------

     For the fiscal  year ended June 30, 2006 and the eleven  months  ended June
30,  2005,  the  aggregate  fees billed for  professional  services  rendered by
Tschopp,  Whitcomb  & Orr P.A.  ("independent  auditors")  for the  audit of the
Company's  annual  financial   statements  and  the  reviews  of  its  financial
statements  included in the Company's  quarterly  reports totaled  approximately
$19,000 and $18,000, respectively.

Financial Information Systems Design and Implementation Fees
------------------------------------------------------------

     For the fiscal  year ended June 30, 2006 and the eleven  months  ended June
30, 2005, there were no fees billed for  professional  services by the Company's
independent  auditors  rendered in  connection  with,  directly  or  indirectly,
operating or supervising the operation of its information system or managing its
local area network.

All Other Fees
--------------

     For the fiscal  year ended June 30, 2006 and the eleven  months  ended June
30,  2005,  there was  approximately  $5,000 and $4,000,  respectively,  in fees
billed for tax and limited consulting services.




                                       28
<PAGE>
                                   SIGNATURES

     Pursuant to the requirements Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has caused this Report to be signed on its behalf by
the undersigned, thereunto duly authorized.


                                      TNR TECHNICAL, INC.

                                      By:/s/ Wayne Thaw
                                         --------------
                                         Wayne Thaw, Chief Executive Officer

Dated:  Sanford, Florida
September 18, 2006

     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
Report  has  been  signed  below  by the  following  persons  on  behalf  of the
Registrant and in the capacities and on the dates indicated:

Signatures                            Title                  Date

/s/ Norman L. Thaw                    Director               September 18, 2006
----------------------
Norman L. Thaw

/s/ Jerrold Lazarus                   Director               September 18, 2006
-----------------------
Jerrold Lazarus

/s/ Wayne Thaw                        Chairman of the        September 18, 2006
---------------------                 Board, Chief
Wayne Thaw                            Executive Officer
                                      President,
                                      Chief Financial
                                      and Accounting
                                      Officer


/s/ Mitchell Thaw                     Director               September 18, 2006
----------------------
Mitchell Thaw

/s/ Patrick Hoscoe                    Vice President         September 18, 2006
--------------------                  and Director
Patrick Hoscoe

/s/ Larry J. Kaczmarek                Director               September 18, 2006
--------------------------
Larry J. Kaczmarek

/s/ Anthony Guadagnino                Director               September 18, 2006
--------------------------
Anthony Guadagnino

Norman Thaw, Wayne Thaw, Mitchell Thaw, Patrick Hoscoe,  Jerrold Lazarus,  Larry
Kaczmarek  and  Anthony  Guadagnino  represent  all the  members of the Board of
Directors.


                                       29