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                       Securities and Exchange Commission
                              Washington D.C. 20549

                                   Form 10-KSB

    (Mark One)

      [  X  ]     ANNUAL  REPORT PURSUANT TO SECTION 13 OR 15(d)
                  OF THE SECURITIES EXCHANGE ACT OF 1934

                     For the Fiscal Year Ended May 31, 2008

                                       OR

      [     ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                  OF THE EXCHANGE ACT OF 1934

                         Commission file number 0-12866



                                   PHAZAR CORP

             (Exact name of registrant as specified in its charter)

           Delaware                                       75-1907070
(State or other jurisdiction of                (IRS Employer Identification No.)
Incorporation or organization)

101 S.E. 25th Avenue, Mineral Wells, Texas 76067            (940) 325-3301
------------------------------------------------            --------------
  (Address of principal executive offices)           (Issuer's telephone number)

Securities registered pursuant to Section 12(b) of the Act:
                                      None

                               Title of each class

                          Common Stock, $0.01 par value

Check  whether  the issuer has (i) filed all  reports  required by Section 13 or
15(d) of the  Exchange  ACT during the past 12 months,  and (ii) been subject to
such filing requirements for the past ninety (90) days. Yes [ X ] No [ ]

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act.)

                                   Yes No (X)

Check if there is no 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 the Form 10-KSB
or any amendment to this Form 10-KSB. [ X ]



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The Company's net sales for Fiscal Year ended May 31, 2008, was $9,247,245.

As of July 15, 2008 2,361,428  shares of Common Stock were  outstanding  and the
aggregate  market  value of the Common Stock (based on the latest price of known
transactions  on the Nasdaq Capital  Market) held by  non-affiliates  (2,070,228
shares) was approximately $9,999,201.

DOCUMENTS INCORPORATED BY REFERENCE

None

Transitional Small Business Disclosure Format (check one):  Yes [   ]  No [ X ]













































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<PAGE>

                                     PART 1

Item 1.  Description of Business.

General

PHAZAR CORP  operates as a holding  company with Antenna  Products  Corporation,
Tumche  Corp.,  Phazar  Antenna  Corp.  and  Thirco,  Inc.  as its wholly  owned
subsidiaries.   Antenna  Products  Corporation  and  Phazar  Antenna  Corp.  are
operating subsidiaries with Thirco, Inc. serving as an equipment leasing company
to PHAZAR  CORP's  operating  units.  Tumche Corp.  has no sales or  operations.
PHAZAR  CORP has no other  business  activity.  The  address for PHAZAR CORP and
subsidiaries is 101 S.E. 25th Avenue,  Mineral Wells, Texas 76067. The telephone
number is (940) 325-3301.

Product   information   is   available   from   the   Internet   web   page  at:
www.antennaproducts.com, www.truemeshnetworks.com and www.phazar.com.

Antenna Products Corporation

Antenna  Products  Corporation  was  incorporated in Texas in 1984 to continue a
business  started in 1947 and operated as a closely held "C"  corporation  until
January 24, 1992.  Thereafter,  Antenna Products Corporation has operated,  as a
wholly owned Subsidiary of PHAZAR CORP.

Antenna  Products  Corporation  designs,  manufactures  and markets standard and
custom  antennas,  wireless  mesh network  solutions,  guyed and self  supported
towers,  support  structures,  masts and  communication  accessories  worldwide.
Customers  include  the  United  States  Government,  both  military  and  civil
agencies,  United States  Government prime  contractors and commercial  clients.
Examples of Antenna Products  Corporation's  United States  Government  products
include tactical military mesh radio wireless networking systems,  ground to air
collinear  antennas,  instrument  landing  antennas  and  towers,  fixed  system
multi-port  antenna arrays,  tactical quick erect antennas and masts,  shipboard
antenna tilting  devices,  transport  pallets,  surveillance  antennas,  antenna
rotators, positioners and controls, and high power broadcast baluns. Examples of
the Company's  commercial  products include first responder emergency mesh radio
systems,  commercial  mesh radio systems,  panel,  sector,  omnidirectional  and
closed  loop  telecommunications   antennas,   automatic  meter  reading  (AMR),
instrument scientific medical (ISM), cellular,  paging and yagi antennas,  guyed
towers and self supported towers.

The majority of Antenna  Products  Corporation's  revenues come from fixed-price
contracts,  secured through a bidding  process,  for particular,  custom ordered
antenna production systems that Antenna Products Corporation builds according to
the  specifications  of the customer.  Except for inventory of standard products
including small antennas,  accessories and some towers in the amount of $307,606
at May 31,  2008,  Antenna  Products  Corporation  does not build and  inventory
equipment  for future off the shelf  sales.  The sales  volume for a  particular
antenna or antenna system is, therefore, a function of the fixed price contracts
for build to order antennas or systems awarded to Antenna Products  Corporation.
However,  a general  product sales breakdown for fiscal year ended May 31, 2008,
and the fiscal year ended May 31, 2007,  as a percentage  of total sales are, as
follows:



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<PAGE>
                                                      For the fiscal year ended
                                                                May 31,
Product Type                                           2008               2007
                                                       ----               ----
Collinear Antennas                                      24%                25%

Spares, Accessories and Others                          24%                30%

Antennas                                                19%                 4%

Commercial Wireless                                     14%                14%

Towers and Masts                                        12%                 6%

Instrument Landing System                                7%                14%

Shipboard Equipment                                      0%                 7%
                                                       ----               ----
                                                       100%               100%

Antenna  Products  Corporation's  customer  base  is  primarily  government  and
government  prime  contractor  focused,  but this is slowly  changing as Antenna
Products  Corporation  continues to develop and market new commercial  products.
Antenna  Products  Corporation's  market  is  international  in  scope.  Antenna
Products Corporation  currently focuses on developing domestic and international
markets.  The specialized need of Antenna Products  Corporation's  customers and
the  technology  required to meet those needs  change  constantly.  Accordingly,
Antenna Products Corporation stresses its engineering, installation, service and
other support capabilities.  Antenna Products Corporation uses its own sales and
engineering  staff to service its principal  markets.  Some of Antenna  Products
Corporation's  contracts  are large  relative to total  annual sales volume and,
therefore,  the  composition  of the customer base is different year to year. In
2008, the United States Government was the single largest customer and accounted
for 24% of the total sales volume.  Paige Iberica,  Spain was the second largest
customer and  accounted for 12% of total sales.  General  Dynamics was the third
largest  customer and accounted  for 9% of total sales.  Orders for equipment in
some of these  product  categories  are in backlog  and,  therefore,  the United
States Government is expected to be a major client again in 2009.

Antenna  Products  Corporation  is one of many suppliers of antennas and related
manufacturing  services to the  government  and  government  prime  contractors.
Antenna  Products  Corporation  competes  on  the  basis  of  cost  and  product
performance in a market with no dominant supplier.  Due to fixed-price contracts
and pre-defined contract  specifications  prevalent within this market,  Antenna
Products  Corporation  competes primarily on the basis of its ability to provide
state-of-the-art  solutions in the technologically  demanding  marketplace while
maintaining its competitive pricing.

Antenna  Products  Corporation,  including its  predecessors,  has been building
antennas and related  structures and systems for over 30 years.  We believe that
Antenna Products  Corporation  enjoys a reputation for building quality products
at a  competitive  price,  because we  continue to be asked to bid for new work.
Because  of  our  size  and  lack  of  significant  liquid  assets  we  are at a
competitive  disadvantage to larger companies that have greater  resources to be
able to bid a job at lower margins.  In terms of gross assets,  sales and number


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<PAGE>
of  employees,  Antenna  Products  Corporation  is a  relatively  small  company
compared to the companies with which we compete.

On the other hand,  our customers know us, know our personnel and can rely on us
to  build  the   antennas  or  towers  or  masts,   etc.   according   to  their
specifications.  We,  therefore,  compete  on the  basis of our  reputation  and
history of building quality products at reasonable prices.

As discussed above,  Antenna Products  Corporation is primarily a build-to-order
company and most manufacturing requirements are established on a contract basis.
For this reason, the majority of the inventory is work in process. Approximately
17% of total inventory,  $307,606 is currently  maintained in stock for delivery
to  customers.  Some raw  materials  are also  inventoried  to support  customer
delivery schedules.  Antenna Products  Corporation  performs work for the United
States Government  primarily under fixed-price prime contracts and subcontracts.
Under fixed-price  contracts,  Antenna Products Corporation realizes any benefit
or detriment occasioned by lower or higher costs of performance.

Antenna Products Corporation is subject to certain risks common to all companies
that derive a portion of their revenues from the United States Government. These
risks  include  rapid  changes in  technology,  changes in levels of  government
spending, and possible cost overruns.  Recognition of profits on major contracts
is based upon  estimates  of final  performance,  which may change as  contracts
progress.   Contract  prices  and  costs  incurred  are  subject  to  Government
Procurement  Regulations,  and  costs may be  questioned  by the  United  States
Government and are subject to disallowance.  United States Government  contracts
contain a provision that they may be terminated at any time for the  convenience
of the United States  Government.  In such event,  the contractor is entitled to
recover  allowable  costs plus any  profits  earned to the date of  termination.
Collections are generally set in accordance with federal acquisition  standards,
which  require  payment in  accordance  with "Net 30" terms after  acceptance of
goods.   Antenna  Products   Corporation  is  not  directly   regulated  by  any
governmental agency in the United States. Most of Antenna Products Corporation's
customers  and the  antenna  and tower  industries  in  general,  are subject to
meeting various government  standards.  These performance  standards necessitate
Antenna Products  Corporation's ability to produce antenna designs, which can be
updated  to  conform  to  customer   requirements   in  a  changing   regulatory
environment. These regulations have not adversely affected operations.

Antenna  Products  Corporation  does  not  depend  on  any  license,  patent  or
trademark,  other than its good name, to secure business. While Antenna Products
Corporation does hold certain patents, they are not material to its business.

While Antenna Products  Corporation  complies with all  environmental  laws, the
costs and effects of compliance are not material to its operations.

Antenna Products Corporation plans to reinvest  approximately 5%-10% of sales in
research and development  projects and bid and proposal  activities.  The mix of
expenditures between the two areas in any given year is a function of the demand
for new independently developed innovative systems and the level of requirements
solicited. In 2008, Antenna Products Corporation, continued development on a new
mesh  radio  wireless  networking  product  line.  This  product  line  includes
military,  emergency  first  responder  and  commercial  mesh radio systems that
utilize proprietary embedded intelligent routing software and multiple frequency
architecture to create dynamic  wireless mesh  networking  systems that transmit


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<PAGE>
and share data, voice and video applications.  This development program resulted
in a total investment in independent  research and development (R&D) and bid and
proposal  activities  (B&P) of 8.8% of sales in 2008. The level of  expenditures
for R&D and B&P as a ratio to sales was 14.4% of sales in 2007. Antenna Products
Corporation does not consider patents to be material to its operations nor would
the loss of any patents adversely affect operations.

Tumche Corp.

Tumche Corp.  is a wholly owned  subsidiary  of PHAZAR CORP.  It has no sales or
operations.

Phazar Antenna Corp.

Phazar Antenna Corp. is a wholly owned  Subsidiary of PHAZAR CORP. It was formed
as a Delaware  Corporation  and activated on June 1, 2000.  Phazar Antenna Corp.
operates as a marketing, research and development unit.

Phazar  Antenna Corp.  provides a line of commercial  wireless  fixed and mobile
antennas   for   ISM   (instrument   scientific   medical),   ITS   (intelligent
transportation systems),  wireless Internet,  wireless LAN, wireless local loop,
fixed GPS,  MMDS (fixed  wireless) and other WiMAX market  applications.  Phazar
Antenna  Corp.  also  supplies a broad range of multiple  band  antennas for the
telecommunication market for DAS (Distributed Antenna Systems). The DAS antennas
for Cellular/SMR, AWS and PCS frequencies are installed on utility poles, street
lights,  rooftops and lamp posts in urban and remote areas to increase  wireless
carrier services.  These product lines compliment Antenna Products Corporation's
existing product lines of cellular,  PCS,  paging,  ISM and AMR (automatic meter
reading),  omni-directional  and sector wireless antennas.  Phazar Antenna Corp.
sales for the twelve months ended May 31, 2008, amounted to approximately 15% of
total sales.  We expect that for fiscal year ended May 31, 2009, this percentage
will  increase as new  products  are added to the  commercial  wireless  product
lines.  The  Phazar  Antenna  Corp.   commercial   wireless  product  lines  are
manufactured at Antenna Products Corporation's plant in Mineral Wells, Texas.

Thirco, Inc.

Thirco,  Inc.  was formed on November 1, 1993 as a Delaware  company to purchase
and lease  equipment and facilities to the other operating units of PHAZAR CORP.
The primary lease  arrangements are with Antenna Products  Corporation.  Thirco,
Inc.  will  occasionally  assist in servicing the banking needs of PHAZAR CORP's
operating units. Since all activity is internal to PHAZAR CORP and its operating
subsidiaries, financial data is consolidated with PHAZAR CORP. Thirco, Inc. does
not  employ  any full time  employees  and does not  intend to employ any in the
foreseeable  future.  Thirco,  Inc.  does not  intend to  engage in any  outside
business transactions.

Seasonality

PHAZAR CORP's businesses are not dependent on seasonal factors.

Backlog

The backlog of orders at Antenna  Products  Corporation and Phazar Antenna Corp.
was $2.5  million at year-end.  This  compares to $3.5 million in backlog at the
end of fiscal year 2007.

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<PAGE>
Raw Material Source and Supply

PHAZAR  CORP's  operating  subsidiaries'  principal  raw  materials  are  steel,
aluminum, other metal alloys, plastic and composite tubing, hardware, electrical
wire, wire rope, electronic components and  electro-mechanical  components.  The
materials  are  commonly  available  from  numerous  sources,   including  local
distributors in quantities sufficient to meet the needs of the subsidiaries. The
availability  and supply of raw materials is not  considered to be a problem for
PHAZAR CORP.

Employees

As of July 15, 2008,  Antenna  Products  Corporation  and Phazar  Antenna  Corp.
combined employed a total of seventy-six employees,  seventy-three full time and
three part time. Of the seventy-six,  twelve are employed in administration  and
sales,  seven  in  engineering  and  technical   support,   and  fifty-seven  in
manufacturing.  None of Antenna Products  Corporation and Phazar Antenna Corp.'s
employees are subject to collective bargaining agreements.

Thirco,  Inc.  does not  employ any full time  employees  and does not intend to
employ any in the foreseeable future.

Foreign Sales

Antenna Products  Corporation's sales in international  markets are primarily to
foreign  governments or prime  contractors to foreign  governments and, as such,
represent  a small  percentage  of the overall  Company  annual  volume.  Phazar
Antenna Corp. has sales in international  markets to commercial  customers.  The
level of profits from the  commitment  of assets to this portion of the business
is no greater or no less than that of other market segments. International sales
for 2008, and 2007 were 26.5% and 13.1%, respectively, of total sales.


Item 2.  Description of Property.

Antenna Products  Corporation  owns a ten-acre  industrial site located along US
Highway 180 in Mineral Wells,  Texas.  The facility  consists of a main building
containing  60,000 square feet of  manufacturing  area and 10,000 square feet of
administrative  and engineering  offices,  a second building  containing  20,000
square feet of manufacturing and shipping area; and a third building  containing
15,000 square feet utilized for receiving and material control. Three additional
auxiliary  buildings,  which total in excess of 13,350 square feet, are utilized
for chemical etching, painting and storage. The facilities are in good condition
and with the current complement of machinery and equipment are suitable and more
than adequate to meet production  requirements.  Dependent on the mix of product
types in process in any given time period,  the Company could  potentially  more
than double output with current and planned plant, property and equipment.

Phazar Antenna Corp. has no facilities. Phazar Antenna Corp. uses the facilities
of Antenna Products Corporation in Mineral Wells, Texas.

Thirco,  Inc.  owns a fifty-acre  test site in Mineral  Wells,  Texas.  The site
includes  three  buildings  with  28,000  square  feet of  space.  The  space is
currently  being leased to Antenna  Products  Corporation for test activity with
some storage of inventory.  The two larger  buildings,  if needed,  are suitable


                                       7
<PAGE>
with  rearrangement and some conversion  expense,  for additional  manufacturing
utilization.

Item 3.  Legal Proceedings.

On June 26, 2008, the Company filed a claim in arbitration against UBS Financial
Services,  Inc. ("UBS") with the Financial Industry Regulatory  Authority,  Inc.
("FINRA") for fraud, breach of fiduciary duty, breach of contract and negligence
in  connection  with the sale by UBS to the  Company  of certain  "auction  rate
securities" in the aggregate  principal  amount of $2,650,000  (the auction rate
securities).

In the arbitration proceeding,  the Company claims it invested its liquid assets
in auction rate  securities in reliance on UBS repeated  representations  to the
Company that the auction rate  securities  were safe,  liquid  investments,  the
equivalent of cash and a prudent investment for the Company's cash. Further, the
Company  claims  these  representations  were  false  and that UBS also  falsely
represented  that the auction  markets  were  stable and that the Company  could
liquidate  its  investment  in the auction rate  securities on any auction date,
making the auction rate  securities the equivalent of cash. The Company  further
claims  that in  February  2008,  with  no  prior  notice  to the  Company,  UBS
unilaterally  abandoned the auction  markets and allowed the auctions of auction
rate  securities it had sold to the Company to fail. The Company further alleges
that the continued failure of the auctions has resulted in the Company's auction
rate  securities  becoming  illiquid  long term fixed  income  investments.  The
Company  seeks,  among other relief,  rescission of its purchases of the auction
rate securities and restoration in cash of its entire  $2,650,000  investment in
the auction rate securities it purchased from UBS.

The Company also  announced  that on June 27, 2008,  the Company filed an action
against UBS in the 348th Judicial  District Court of Tarrant County,  Texas (the
"Injunctive  Action").  In the Injunctive  Action,  the Company seeks injunctive
relief prohibiting UBS from denying the Company access to the $2,650,000 in cash
the Company invested in auction rate securities.

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

No matters were submitted to a vote of security holders through the solicitation
of proxies or otherwise during the fourth quarter of fiscal year 2008.

                                     PART II

Item 5.  Market for Common Equity and Related Stockholder Matters.

The  information in this item should be read in conjunction  with the Management
Discussion and Analysis of Financial Condition and Results of Operations in Item
6, and the  consolidated  financial  statements and the related notes thereto in
Item 7.

Market Information For The Common Stock

PHAZAR CORP's common stock is traded on the Nasdaq  Capital Market and is quoted
under the symbol "ANTP".




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<PAGE>
The table below  presents  the high and low prices for the last two fiscal years
and  reflects  inter-dealer  prices,   without  retail  mark-up,   mark-down  or
commission and may not represent actual transactions.

                                                                   BID
                    Quarter Ended                         High             Low

                    August 2006                          11.46            6.53
                    November 2006                         7.80            4.65
                    February 2007                         8.65            5.65
                    May 2007                              7.27            5.24

                    August 2007                          11.10            5.55
                    November 2007                        11.25            5.96
                    February 2008                         8.48            4.24
                    May 2008                              8.40            5.25

Holders

At July 15, 2008,  there were  approximately  1,986  holders of record of common
stock.

Dividends

PHAZAR CORP has never paid a regular  cash  dividend on common  stock and has no
plans to institute payment of regular dividends.

Recent Sales of Unregistered Securities

As partial  consideration  for  attending  the PHAZAR  CORP Board of  Directors'
meetings,  Gary W. Havener,  Clark D. Wraight, James Miles, James Kenney, Dennis
Maunder  and R. Allen Wahl each  received  1,200  shares of PHAZAR  CORP  common
stock.  Garland P. Asher  received 800 shares of PHAZAR common  stock.  Also, as
partial consideration for attending the PHAZAR CORP audit committee meetings, R.
Allen Wahl and Dennis  Maunder each received an additional  800 shares of PHAZAR
CORP common stock, James Kenney received an additional 600 shares of PHAZAR CORP
common stock and Garland P. Asher  received an  additional  400 shares of PHAZAR
CORP common stock.  Each Director  agreed to hold the shares for  investment and
not for further  distribution.  The certificates  representing the shares bear a
legend   restricting   transfer   without   compliance  with  the   registration
requirements  of the  Federal  Securities  Act of  1933 or in  reliance  upon an
applicable  exemption  therefrom.  PHAZAR  CORP  relied on  section  4(2) of the
Securities Act of 1933 as its exemption from registration.

Item 6.  Management's Discussion and Analysis or Plan of Operation.

Company Overview

PHAZAR CORP's continuing operation is that of its subsidiaries, Antenna Products
Corporation,  Phazar Antenna Corp.,  Tumche Corp. and Thirco, Inc. As previously
discussed in Item 1, for the purpose of this  discussion,  all results of Phazar
Antenna Corp. are included with the results of Antenna Products Corporation. The
management  discussion  presented  in this item  relates  to the  operations  of
subsidiary units and the associated consolidated financials as presented in Item
7.


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<PAGE>
PHAZAR CORP  operates as a holding  company with Antenna  Products  Corporation,
Phazar  Antenna  Corp.,  Tumche  Corp.  and  Thirco,  Inc.  as its wholly  owned
subsidiaries.   Antenna  Products  Corporation  and  Phazar  Antenna  Corp.  are
operating subsidiaries with Thirco, Inc. serving as an equipment leasing company
to PHAZAR  CORP's  operating  units.  Tumche Corp.  has no sales or  operations.
Antenna Products Corporation designs,  manufactures and markets antenna systems,
towers and communication  accessories  worldwide.  The United States Government,
military  and  civil  agencies  and  prime   contractors  are  Antenna  Products
Corporation's  principal  customers.  Phazar  Antenna Corp.  designs and markets
fixed and mobile  antennas for  commercial  wireless  applications  that include
cellular,  PCS,  ISM  (instrument  scientific  medical),  AMR  (automatic  meter
reading), wireless internet, wireless local area network, and other WiMax market
applications.

PHAZAR CORP is primarily a build-to-order  company.  As such, most United States
government and  commercial  orders are negotiated  firm-fixed  price  contracts.
PHAZAR CORP's sales to major customers at May 31, 2008, as a percentage of total
sales were United States  Government 24%, Paige Iberica,  Spain, 12% and General
Dynamics 9%.

Executive Level Overview

The  following  table  presents  selected  financial  data of PHAZAR CORP.  This
historical  data  should  be read in  conjunction  with  consolidated  financial
statements and the related notes thereto in Item 7.

                                                    Fiscal Year Ending May 31,
                                                        2008          2007
                                                  -------------   -------------
     Net sales                                    $  9,247,245    $  5,220,868
       Product line with highest sales         Collinear - 24% Collinear - 25%
       Foreign sales (as % of total sales)               26.5%           13.1%

     Gross Product Margin                                36.6%           40.6%
     Operating Profit (loss)                      $    703,794    $   (613,786)

     Net income (loss)                            $    622,904    $   (303,040)

     Net income (loss) per share                  $       0.27    $      (0.13)

     Total assets                                 $  8,960,874    $  7,588,883

     Long term debt                               $          -    $          -
     Total liabilities                            $  1,076,525    $    433,727

       Capital expenditures                       $          -    $          -
       Dividends                                  $          -    $          -

Critical Accounting Policies

The preparation of PHAZAR CORP's consolidated financial statements in accordance
with accounting principles and practices generally accepted in the United States
of America  requires PHAZAR CORP to make estimates and assumptions  that affect:
the reported  amounts of assets and  liabilities  and  disclosure  of contingent
assets and liabilities at the date of the financial statements; and the reported
amounts of revenues and expenses  during the reporting  periods.  PHAZAR CORP is

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<PAGE>
required to make  judgments and  estimates  about the effect of matters that are
inherently uncertain.  Actual results could differ from PHAZAR CORP's estimates.
The most  significant  areas involving PHAZAR CORP's judgments and estimates are
described below.

Inventory Valuation

Inventory is stated at the lower of cost or market,  with cost being  determined
on a first-in, first-out basis. Provisions are made to reduce excess or obsolete
inventory to its estimated net realizable  value. The process for evaluating the
value of excess  and  obsolete  inventory  often  requires  PHAZAR  CORP to make
subjective  judgments and estimates  concerning future sales levels,  quantities
and prices at which such  inventory will be able to be sold in the normal course
of business.  Accelerating the disposal process or incorrect estimates of future
sales potential may necessitate future adjustments to these provisions.

Accounts Receivable Valuation

PHAZAR CORP  maintains an allowance for doubtful  accounts for estimated  losses
resulting  from the  inability  of  PHAZAR  CORP's  customers  to make  required
payments.  If the  financial  condition  of  PHAZAR  CORP's  customers  were  to
deteriorate  resulting  in an  impairment  of their  ability  to make  payments,
additional allowances may be required.

Revenue Recognition

Revenue from short-term contracts calling for delivery of products is recognized
as the product is shipped. Revenue and costs under certain long-term fixed price
contracts  with the United States  Government are recognized on the units of are
recognized on the units of delivery  method.  This method  recognizes as revenue
the contract price of units of the product  delivered during each period and the
costs  allocable to the  delivered  units as the cost of earned  revenue.  Costs
allocable to  undelivered  units are reported in the balance sheet as inventory.
Amounts in excess of agreed upon contract price for customer  directed  changes,
constructive  changes,  customer  delays or other causes of additional  contract
costs are  recognized in contract  value if it is probable that a claim for such
amounts  will result in  additional  revenue  and the amounts can be  reasonably
estimated. Revisions in cost and profit estimates are reflected in the period in
which the facts requiring the revision become known and are estimable. Losses on
contracts are recorded when identified.

Income Taxes

PHAZAR CORP  accounts  for income  taxes  pursuant  to  Statement  of  Financial
Accounting  Standards  No. 109,  "Accounting  for Income Taxes" (SFAS 109) which
utilizes the asset and liability method of computing  deferred income taxes. The
objective of the asset and liability method is to establish  deferred tax assets
and liabilities for the temporary  differences  between the financial  reporting
basis and the tax basis of PHAZAR CORP's assets and  liabilities  at enacted tax
rates  expected to be in effect when such amounts are  realized or settled.  The
current  and  deferred  tax   provision  is  allocated   among  members  of  the
consolidated group on the separate income tax return basis.

Results of Operations

Year ended May 31, 2008 ("2008") compared with year ended May 31, 2007 ("2007")

                                       11
<PAGE>
PHAZAR  CORP's  consolidated  sales from  operations  were  $9,247,245  in 2008,
compared to  consolidated  sales from  operations of $5,220,868 in 2007.  PHAZAR
CORP  recorded  a net  profit of  $622,904  in 2008,  compared  to a net loss of
$303,040 in 2007.

PHAZAR CORP's net income  increased  $925,944 on a 77% increase in sales of both
military and commercial  product lines,  which included a significant  growth in
international sales.

Orders  increased 8% in both  military and  commercial  product  lines from $7.7
million in 2007 to $8.3 million in 2008.  While orders were up for the year, the
ending  backlog at May 31, 2008, of $2.5 million,  was down from prior  year-end
backlog of $3.5 million due to contracts being completed prior to year end.

Cost of sales and  contracts  and gross  profit for fiscal year 2008,  were $5.9
million and $3.4  million,  respectively.  For the same period in 2007,  cost of
sales and  contracts and gross profit for fiscal year 2007 were $3.1 million and
$2.1  million,  respectively.  The gross profit  margin for the  operations  for
fiscal  year 2008 was 36.6%  compared  to 40.6% in 2007.  The  decrease in gross
margin is attributed  to increases in commodity  prices and higher than expected
level of  warranty  cost for the  recall  and  modification  of a safety  sleeve
product in 2008.

Sales and Administration  expenses were $2.68 million in 2008, compared to $2.73
million in 2007.  When expressed as a ratio to sales,  sales and  administration
expenses  were  29% of  sales  in  2008,  compared  to 52% in  2007.  Sales  and
administration  expenses decrease when charges to overhead accounts decrease and
labor  charges  to  contract  work  orders  increase,  thus the  reduction  as a
percentage of sales is primarily due to the increase in sales for the year.

The  Company  had an  operating  profit  of  $703,794  in 2008,  compared  to an
operating  loss of $613,786 in 2007 due to the higher level of sales in both the
military  and  commercial  product  lines  and  the  significant  growth  in the
international sales.

Discretionary  product development and bid/proposal spending totaled $814,464 or
8.8% of sales in 2008 compared to $752,476 or 14.4% of sales in 2007.  There was
$0  interest  expense  in both  fiscal  year  2008 and  2007.  The  income  from
operations  before  income  taxes was  $871,815  in 2008  compared  to a loss of
$454,098 in 2007.

United  States  Government  contracts  contain  a  provision  that  they  may be
terminated at any time for the convenience of the Government. In such event, the
contractor is entitled to recover allowable costs plus any profits earned to the
date of termination.  The possibility  that Government  priorities could change,
causing  a delay  or  cancellation  of  existing  contracts  and  any  potential
follow-on work, makes it impossible to accurately  predict whether revenues will
increase or decrease in the upcoming year.

Product Warranties

PHAZAR CORP's  management  estimates  accrued warranty expense based on warranty
work received but not performed and on analysis of historical  trends  including
actual expense as a percent of sales.



                                       12
<PAGE>
Changes  in  accrued  warranty  liability  for the years  ended  May 31,  are as
follows:

                                                        2008           2007
                                                   -------------  -------------
        Beginning balance                          $     68,376   $     41,792
        Cost incurred for rework                       (150,652)       (48,592)
        Accrual for current year estimate               122,376         68,376
        Change in accrued estimate                       82,276          6,800
                                                   ------------   ------------
        Ending balance                             $    122,376   $     68,376
                                                   ============   ============

Liquidity and Capital Resources

Sources of Liquidity

Funds generated from operations are the major internal  sources of liquidity and
are  supplemented  by funds  derived  from  capital  markets,  principally  bank
facilities.  PHAZAR CORP has a $1.0 million revolving demand line of credit with
a bank.  The credit line is  regulated  under a  borrowing  base  formula  using
inventories  and  accounts  receivable  as  collateral.  The  interest  rate  is
established  as equal to Wall  Street  prime and is subject to a loan  agreement
with restrictive covenants. The most restrictive financial covenant requires the
Company to  maintain  $3.0  million in tangible  net worth and to maintain  $1.0
million of working  capital.  At May 31,  2008,  the Company had a tangible  net
worth of $7.9  million and had working  capital of $4.4  million.  As of May 31,
2008,  Antenna  Products  Corporation  had drawn $0 of the $1.0  million line of
credit  with $1.0  million of the  borrowing  base  available  and  unused.  The
revolving  credit  line  agreement  was  renewed  with a $1.0  million  limit on
September 26, 2006 for a period of two years.  We are in the process of renewing
this agreement.  PHAZAR CORP believes that its cash and the credit  available at
May 31, 2008, is sufficient  to fund the  Company's  operations  for at least 12
months.

Capital Requirements

Management of the operating  subsidiaries  evaluates the  facilities  and review
equipment  requirements for existing and projected contracts on a regular basis.
An annual  capital plan is generated by management and submitted to the Board of
Directors  for review and  approval.  In fiscal  year 2008 there were no capital
expenditures for new and replacement equipment. The Company anticipates that the
existing  facilities and equipment are adequate to handle the projected business
in fiscal year 2009 and intends to limit the 2009  capital  program to less than
$100,000 for improvements and new equipment.

At May 31,  2008,  PHAZAR CORP had cash and cash  equivalents  of $2.5  million.
Deferred revenue at May 31, 2008, is $315,654.

Cash Flows

Operating Activities

The  decrease  in cash  and  cash  equivalents  of  $1.7  million  is  primarily
attributed  to the transfer of the $2.65  million in auction rate  securities to


                                       13
<PAGE>
long term marketable  securities offset by a positive $830,411 of cash flow from
operating  activities.  In mid  February  2008,  liquidity  issues in the global
credit  markets  resulted  in the failure of  auctions  representing  all of the
auction rate securities the Company holds. The principal  associated with failed
auctions will not be accessible  until  successful  auctions  occur,  a buyer is
found outside the auction  process,  the issuers  establish a different  form of
financing to replace these  securities,  or final payments come due according to
contractual maturities ranging from 28 to 30 years. The Company understands that
the issuers and financial  markets are working on alternatives  that may improve
liquidity,  however it is not clear when or if such efforts will be  successful.
In addition,  the Company has filed a claim in arbitration against UBS Financial
Services (See Item 3. Legal Proceedings) seeking,  among other relief rescission
of its purchases of the auction rate  securities and  restoration in cash of its
entire $2.65 million investment it purchased from UBS.

While the recent  auction  failures  will limit our ability to  liquidate  these
investments for some period of time, we do not believe the auction failures will
materially  impact  our  ability  to fund our  working  capital  needs,  capital
expenditures or other business requirements.

The increase in accounts receivable to $987,258 at May 31, 2008 from $333,748 at
May 31, 2007,  reflects the increased  level of business volume during 2008. The
backlog of orders was $2.5 million on May 31, 2008,  compared to $3.5 million on
May 31, 2007.

The  increase  in accounts  payable and accrued  expenses to $760,871 at May 31,
2008,  from  $433,727 at May 31,  2007,  reflects  the  material  purchased  for
contracts  currently in  production,  accruals for 2008 profit sharing and sales
and administrative  expenses accrued for services provided in 2008.  Inventories
remained  relatively flat although raw materials were up 30% due to increases in
commodity  prices  which  were  offset  by  an  11%  drop  in   work-in-progress
attributable to the timing of contracts in production.

Cash  provided by the operating  activities in the year ended May 31, 2008,  was
$830,411 compared to cash used by operating  activities of $519,397 for the same
period in 2007.  $622,904 of cash  provided by operating  activities  at May 31,
2008,  represented  PHAZAR  CORP's net income  compared to $303,040 cash used by
operating activities at May 31, 2007.

Investing Activities

Cash was not used in  investing  activities  during the years ended May 31, 2008
and 2007;  however $2.65 million of marketable  securities  were  transferred to
long term marketable securities during 2008.

Financing Activities

Cash  provided  by  financing  activities  in the year ended May 31,  2008,  was
$152,106  compared to cash  provided by financing  activities of $84,745 for the
same period in 2007.  The financing  activities for the years ended May 31, 2008
and May 31, 2007  consisted  primarily  of proceeds  from the  exercise of stock
options and the FIT benefit resulting from the exercise of stock options. At May
31, 2008 and May 31, 2007, PHAZAR CORP had no long-term debt outstanding.




                                       14
<PAGE>
Item 7.  Financial Statements.

PHAZAR CORP consolidated  financial statements for the fiscal year ended May 31,
2008.


                                 C O N T E N T S


                                                                        Page

CONSOLIDATED FINANCIAL STATEMENTS

     Consolidated Balance Sheets.........................................17

     Consolidated Statements of Operations...............................19

     Consolidated Statements of Shareholders' Equity.....................20

     Consolidated Statements of Cash Flows...............................21

     Notes to Consolidated Financial Statements..........................22



































                                       15
<PAGE>
             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To The Board of Directors and Stockholders
PHAZAR CORP and Subsidiaries

We have audited the accompanying  consolidated balance sheets of PHAZAR CORP and
Subsidiaries  as of  May  31,  2008  and  2007,  and  the  related  consolidated
statements of operations, shareholders' equity and cash flows for the years then
ended.  These  consolidated  financial  statements are the responsibility of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
consolidated 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
consolidated  financial statements are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the  consolidated  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 consolidated  financial statements referred to above present
fairly,  in all material  respects,  the  financial  position of PHAZAR CORP and
subsidiaries  as of May 31, 2008 and 2007,  and the results of their  operations
and their cash flows for the years then ended,  in  conformity  with  accounting
principles generally accepted in the United States of America.




WEAVER AND TIDWELL, L.L.P.

Fort Worth, Texas

August 18, 2008




















                                       16
<PAGE>
                          PHAZAR CORP AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                              MAY 31, 2008 AND 2007

                                     ASSETS

                                                        2008         2007
                                                   ------------- -------------
CURRENT ASSETS
 Cash and cash equivalents                         $  2,446,563  $  4,114,046
 Accounts receivable:
   Trade, net of allowance for
    doubtful accounts of $2,002
    in 2008, and $7,021 in 2007                         905,091       291,470
   United States Government                              82,167        42,278
Inventories                                           1,777,335     1,703,164
Prepaid expenses and other assets                        47,761        64,132
Income taxes receivable                                 169,597       229,373
Deferred income taxes                                    67,697        54,836
                                                   ------------  ------------
Total current assets                                  5,496,211     6,499,299

Property and equipment, net                             939,084     1,052,766

Marketable securities                                 2,346,840             -

Long-term deferred income tax                           178,739        36,818
                                                   ------------  ------------
TOTAL ASSETS                                       $  8,960,874  $  7,588,883
                                                   ============  ============












The Notes to Consolidated Financial Statements
are an integral part of these statements.













                                       17
<PAGE>
                          PHAZAR CORP AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                              MAY 31, 2008 AND 2007

                      LIABILITIES AND SHAREHOLDERS' EQUITY

                                                        2008         2007
                                                   ------------- -------------
CURRENT LIABILITIES
 Accounts payable                                  $    298,192  $    128,579
 Accrued expenses                                       462,679       305,148
 Deferred revenues                                      315,654             -
                                                   ------------  ------------
Total current liabilities                             1,076,525       433,727

   Total liabilities                                  1,076,525       433,727
                                                   ------------  ------------
COMMITMENTS AND CONTINGENCIES                                 -             -

SHAREHOLDERS' EQUITY

Preferred stock, $1 par, 2,000,000
  shares authorized, none issued
  or outstanding, attributes to be
  determined when issued                                      -             -
Common stock, $0.01 par, 6,000,000
  shares authorized 2,357,728 and
  2,308,128 issued and outstanding                       23,578        23,082
Additional paid in capital                            3,723,278     3,417,399
Retained earnings                                     4,337,579     3,714,675
Accumulated other comprehensive loss,
  net of tax                                           (200,086)            -
                                                   ------------  ------------
Total shareholders' equity                            7,884,349     7,155,156
                                                   ------------  ------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY         $  8,960,874  $  7,588,883
                                                   ============  ============







The Notes to Consolidated Financial Statements
are an integral part of these statements.











                                       18
<PAGE>
                          PHAZAR CORP AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                        YEARS ENDED MAY 31, 2008 AND 2007

                                                         2008          2007
                                                    ------------- -------------
Sales and contract revenues                         $  9,247,245  $  5,220,868
Cost of sales and contracts                            5,866,837     3,099,897
                                                    ------------  ------------
   Gross Profit                                        3,380,408     2,120,971

Sales and administration expenses                      2,676,614     2,734,757
                                                    ------------  ------------
   Operating Profit (loss)                               703,794      (613,786)
                                                    ------------  ------------
Other income
   Interest income                                       114,081        55,635
   Other income                                           53,940       104,053
                                                    ------------  ------------
Total other income                                       168,021       159,688
                                                    ------------  ------------
Income (loss) from operations before income taxes        871,815      (454,098)

Income tax provision (benefit)                           248,911      (151,058)
                                                    ------------  ------------
Net income (loss)                                   $    622,904  $   (303,040)
                                                    ============  ============
Basic earnings (loss) per common share              $       0.27  $      (0.13)
                                                    ============  ============
Diluted earnings (loss) per common share            $       0.27  $      (0.13)
                                                    ============  ============






The Notes to Consolidated Financial Statements
are an integral part of these statements.


















                                       19
<PAGE>
                          PHAZAR CORP AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                        YEARS ENDED MAY 31, 2008 AND 2007
<TABLE>
<S>             <C>        <C>      <C>          <C>           <C>          <C>
                  Common Stock                   Accumulated
                  ------------      Additional      Other
                  Number              Paid In   Comprehensive    Retained
                of Shares  Amount     Capital   Income (loss)    Earnings      Total
                ---------  -------  ----------  -------------  -----------  ----------
BALANCE,
MAY 31, 2006    2,281,528  $22,816  $3,213,901  $         -    $4,017,715   $7,254,432

Stock issued
to Directors        6,600       66      42,655            -             -       42,721

Stock based
compensation            -        -      76,298            -             -       76,298

Stock options
exercised          20,000      200      39,800            -             -       40,000

Tax benefit
for employee
stock options           -        -      44,745            -             -       44,745

Net income(loss)        -        -           -            -      (303,040)    (303,040)
                ---------  -------  ----------  -----------    ----------   ----------
BALANCE,
MAY 31, 2007    2,308,128  $23,082  $3,417,399  $         -    $3,714,675   $7,155,156
                =========  =======  ==========  ===========    ==========   ==========
Stock issued
to Directors       10,600      106      73,175            -             -       73,281

Stock based
compensation            -        -      80,988            -             -       80,988

Stock options
exercised          39,000      390      77,610            -             -       78,000

Tax benefit for
employee
stock options           -        -      74,106            -             -       74,106

Temporary
impairment on
available for
sale securities,
net of tax                                   -     (200,086)            -     (200,086)

Net income(loss)        -        -           -            -       622,904      622,904
                ---------  -------  ----------  -----------    ----------   ----------
BALANCE,
MAY 31, 2008    2,357,728  $23,578  $3,723,278  $  (200,086)   $4,337,579   $7,884,349
                =========  =======  ==========  ===========    ==========   ==========
</TABLE>




The Notes to Consolidated Financial Statements
are an integral part of these statements.

                                       20
<PAGE>
                          PHAZAR CORP AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                       YEARS ENDED MAY 31, 2008, AND 2007

                                                         2008          2007
                                                    ------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income (loss)                                  $    622,904  $   (303,040)
 Depreciation                                            113,682       115,854
 Amortization                                                  -         1,250
 Stock based compensation                                154,269       119,019
 Tax benefit for employee stock options                  (74,106)      (44,745)
 Deferred federal income tax                             (51,707)      (54,021)
 Changes in assets and liabilities:
  Accounts receivable                                   (653,510)      127,737
  Inventory                                              (74,171)     (408,516)
  Income taxes receivable                                133,882       (12,201)
  Prepaid expenses                                        16,370        12,117
  Accounts payable                                       169,613       (54,213)
  Accrued expenses                                       157,531       (18,638)
  Deferred revenue                                       315,654             -
                                                    ------------  ------------
 Net cash provided (used) by operating activities
                                                         830,411      (519,397)
CASH FLOWS FROM INVESTING ACTIVITIES:
 Transfer to marketable securities                    (2,650,000)            -
 Purchase of property and equipment                            -             -
                                                    ------------  ------------
                                                      (2,650,000)            -
CASH FLOWS FROM FINANCING ACTIVIITES:
 Proceeds from exercise of stock options                  78,000        40,000
 FIT benefit-stock options exercised                      74,106        44,745
                                                    ------------  ------------
                                                         152,106        84,745

 Net increase (decrease) in cash and
       cash equivalents                               (1,667,483)     (434,652)
                                                    ------------  ------------
CASH AND CASH EQUIVALENTS, beginning of year           4,114,046     4,548,698
                                                    ------------  ------------
CASH AND CASH EQUIVALENTS, end of year              $  2,446,563  $  4,114,046
                                                    ============  ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
 Cash paid during the period for:
   Interest expense                                 $          -  $          -

   Income taxes                                     $    160,000  $    100,000



The Notes to Consolidated Financial Statements
are an integral part of these statements.




                                       21
<PAGE>
NOTE 1.  BUSINESS AND NATURE OF OPERATION

     PHAZAR  CORP   operates  as  a  holding   company  with  Antenna   Products
     Corporation,  Phazar  Antenna Corp.,  Tumche Corp. and Thirco,  Inc. as its
     wholly owned  subsidiaries.  Antenna  Products  Corporation is an operating
     subsidiary that designs, manufactures and markets antenna systems, wireless
     mesh network solutions,  towers, and communication  accessories  worldwide.
     The  United  States  Government,  military  and civil  agencies,  and prime
     contractors represent Antenna Products  Corporation's  principal customers.
     Phazar Antenna Corp. is a separate legal entity that currently  operates as
     a small  division  of Antenna  Products  Corporation.  Thirco  serves as an
     equipment  leasing company to Antenna Products  Corporation.  The Company's
     operations are performed in Texas for customers throughout the country.

     Following is a schedule of the  Company's  sales to major  customers at May
     31, as a percentage of total sales:
                                                      2008         2007
                                                      ----         ----
        United States Government                       24%          21%
        Paige Iberica, Spain                           12%           0%
        General Dynamics                                9%           7%
        BAE Systems                                     0%           4%
        Thales ATM, Inc.                                6%          11%

     At May 31, 2008, and 2007, trade receivables from four customers  comprised
     approximately 50% and 59%, respectively, of the trade receivable balance at
     those dates.


NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

  Principles of Consolidation

     The consolidated  financial  statements include the accounts of the Company
     and  its   subsidiaries.   All   significant   intercompany   balances  and
     transactions are eliminated in consolidation.

  Revenue Recognition

     Antenna Products  Corporation  manufactures and markets standard and custom
     antennas, wireless mesh network solutions, guyed and self-supported towers,
     support  structures,   masts  and  communication   accessories   worldwide.
     Customers include the U.S.  Government,  military and civil agencies,  U.S.
     Government prime  contractors and commercial  clients.  Examples of Antenna
     Products  Corporation's U.S.  Government products include tactical military
     mesh radio wireless networking  systems,  ground to air collinear antennas,
     instrument  landing antennas and towers,  fixed system  multi-port  antenna
     arrays,  tactical quick erect antennas and masts, shipboard antenna tilting
     devices,  transport  pallets,   surveillance  antennas,  antenna  rotators,
     positioners and controls, and high power broadcast baluns.  Examples of the
     Company's   commercial   products  (Phazar  Antenna  Corp.)  include  first
     responder  emergency  mesh radio  systems,  commercial  mesh radio systems,
     panel,  sector,   omnidirectional  and  closed  loop  PCS  antennas;  WiMax
     Antennas,   automatic  meter  reading  (AMR),  cellular,  paging  and  yagi
     antennas, guyed towers and self supported towers.


                                       22
<PAGE>
NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued

     Antenna  Products  Corporation is primarily a  build-to-order  company.  As
     such,  most  orders  are  negotiated   firm-fixed  price  contracts.   Most
     commercial  contracts are single order and single delivery firm-fixed price
     contracts.  Some  government  contracts  are  multi-year  performance  with
     established option dates with a predetermined  escalated price for delivery
     in that  outyear.  These types of  contracts  can be valid from two to five
     years.  Other types of government  contracts  are called  supply  contracts
     where the  government  buys a  particular  product  and has  estimated  the
     quantity required over an expected period. Antenna Products Corporation has
     contracts with major prime  contractors  who negotiate  contracts  based on
     large  quantities  with set escalation  rates for future  prices.  The U.S.
     Government  is  attempting  to  procure  more and more  products  that have
     commercial  equivalents  to military  standards.  These  purchases  are for
     off-the-shelf  products  and,  therefore,   use  credit  cards  and  accept
     commercial  terms  and  shipping  methods.   Antenna  Products  Corporation
     recognizes  an  order or  resultant  sale  when  official  notification  is
     received that an option is being exercised and the order is shipped.

     Revenue  from  short-term  contracts  calling  for  delivery of products is
     recognized as the product is shipped. Undelivered units are reported in the
     balance sheet as inventory. Amounts in excess of agreed upon contract price
     for customer directed  changes,  constructive  changes,  customer delays or
     other causes of additional  contract costs are recognized in contract value
     if it is probable  that a claim for such amounts will result in  additional
     revenue and the amounts can be reasonably estimated.  Revisions in cost and
     profit  estimates are reflected in the period in which the facts  requiring
     the  revision  become  known and are  estimable.  Losses on  contracts  are
     recorded when identified.

  Inventories

     Inventories are valued at the lower of cost or market, with cost determined
     on the  first-in,  first-out  basis.  Market  is  replacement  cost  or net
     realizable  value.  Work in progress and finished  goods include  material,
     labor and overhead.

  Property and Equipment

     Property  and  equipment  are  recorded  at  cost  and  depreciated  by the
     straight-line  method over the  expected  useful  lives of the assets.  The
     estimated  useful  lives  are:  building  and  improvement  - 15-30  years;
     machinery  and equipment - 10 years;  automobiles  and equipment - 3 years;
     and  office  furniture  and  fixtures - 10 years.  Expenditures  for normal
     maintenance and repairs are charged to income, and significant improvements
     are  capitalized.  The cost of assets  sold or  abandoned  and the  related
     accumulated  depreciation  are  eliminated  from the  accounts  and the net
     amount, less proceeds from disposal, is charged or credited to income.

  Use of Estimates and Assumptions

     Management uses estimates and assumptions in preparing financial statements
     in  accordance  with  generally  accepted  accounting   principles.   Those
     estimates  and  assumptions  affect  the  reported  amounts  of assets  and


                                       23
<PAGE>
NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued

     liabilities,  the disclosure of contingent assets and liabilities,  and the
     reported  revenues  and  expenses.  Actual  results  could  vary  from  the
     estimates that were used.

  Income Taxes

     The Company  accounts for income  taxes  pursuant to Statement of Financial
     Accounting  Standards  No. 109,  "Accounting  for Income  Taxes" (SFAS 109)
     which utilizes the asset and liability method of computing  deferred income
     taxes.  The  objective  of the asset and  liability  method is to establish
     deferred tax assets and liabilities for the temporary  differences  between
     the financial reporting basis and the tax basis of the Company's assets and
     liabilities at enacted tax rates expected to be in effect when such amounts
     are  realized  or  settled.  The  current and  deferred  tax  provision  is
     allocated  among the  members  of the  consolidated  group on the  separate
     income tax return basis.

     In July,  2006, the Financial  Accounting  Standards  Board ("FASB") issued
     FASB Interpretation No. 48 ("FIN 48"), Accounting for Uncertainty in Income
     Taxes - an  interpretation  of FASB  Statement No. 109 ("SFAS  109").  This
     interpretation,  which became  effective for fiscal years  beginning  after
     December  15, 2006,  introduces  a new approach  that changes how an entity
     recognizes and measures tax benefits  associated with tax positions and how
     to  disclose  uncertainties  related  to  income  tax  provisions  in their
     financial statements.

  Research and Development Costs

     Research and development  costs are charged to operations when incurred and
     are included in operating expenses. The amounts charged for the years ended
     May  31,  2008,  and  2007,  were  approximately   $563,160  and  $316,000,
     respectively.

  Cash and Cash Equivalents

     For purposes of reporting  cash flows,  cash and cash  equivalents  include
     cash and  certificates of deposit with original  maturities of three months
     or less.

     Early  in  the  fourth  quarter  of  2008,  the  Company's  cash  and  cash
     equivalents  included  $2.65  million  of  investment  grade  auction  rate
     securities with an active resale market to ensure liquidity. The securities
     have long-term  maturities,  typically 30+ years; however the auctions were
     held  every  7, 28,  or 35 days so that  the  holder  of the  auction  rate
     security  could  liquidate the  investment on any auction date,  making the
     auction rate security the equivalent of cash.  Then in February 2008,  most
     auctions  of auction  rate  securities  began to fail and they  continue to
     fail.  Because the auctions  continue to fail,  the Company's  auction rate
     securities  should not be  considered  the  equivalent of cash.  Thus,  the
     Company now carries the $2.35 million  principal amount of its auction rate
     securities as long term marketable securities.




                                       24
<PAGE>
  Warranties

     The Company provides for the estimated cost of product  warranties.  Actual
     costs as incurred are charged directly to cost of sales and the adequacy of
     the liability is assessed on a quarterly basis.

  Other Comprehensive Income (Loss)

     Other  comprehensive  income (loss) is defined as the change in equity of a
     business  enterprise during a period from transactions and other events and
     circumstances from non-owner sources.  Comprehensive income consists of net
     income (loss), net holding gains (losses) on investments,  net unrecognized
     loss on  pensions,  deferred  gains  (losses)  from  derivatives  and gains
     (losses) from foreign currency translation.  All transactions are shown net
     of tax.

  Stock-based Employee Compensation

     On June 1, 2006,  the Company  adopted  Statement of  Financial  Accounting
     Standard No. 123R ,  Share-Based  Payment  ("SFAS 123R") which required all
     share  based  payments to  employees,  including  grants of employee  stock
     options,  to be  recognized  in the  income  statement  based on their fair
     values at the time of the grant. The company uses the  Black-Scholes  Model
     option  pricing model to determine the fair value of stock options  granted
     to  employees.  Stock based  compensation  recognized  in the twelve months
     ended 2008 and 2007 were $154,269 and $119,019, respectively.

     The income tax  benefit  related to  stock-based  compensation  expense was
     $74,106 and $44,745 for the years ended May 31, 2008 and 2007 respectively.
     In accordance with SFAS 123R, the Company has presented excess tax benefits
     from the exercise  stock-based  compensation awards as a financing activity
     in the consolidated statement of cash flows.

  Shares,  Per  Share Data,  Earnings  Per Share,  and  Stock Split,  and Common
  Stock Par Value

     Earnings  per share are  computed  by  dividing  net  income  (loss) by the
     weighted  average  number of common  shares  outstanding  during  the year.
     Weighted  average shares  outstanding  were 2,340,338 and 2,295,855 for the
     years ended May 31, 2008, and 2007, respectively.

     Dilutive  effect of stock options  outstanding  for the years ended May 31,
     2008 and 2007, are computed as follows:














                                       25
<PAGE>
NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued

                                                        2008           2007
                                                    ------------- -------------
       Numerator:
         Net income (loss)                          $    622,904  $   (303,040)
                                                    ------------  ------------
         Numerator for basic and
          diluted earnings per share                $    622,904  $   (303,040)
                                                    ------------  ------------

       Denominator:
         Weighted-average shares outstanding-basic     2,340,338     2,295,855
         Effect of dilutive securities:
            Stock options                                  5,292             -
                                                    ------------  ------------

         Denominator for diluted earnings per share-
         Weighted-average shares                       2,345,630     2,295,855
                                                    ------------  ------------
         Basic earnings per share                   $       0.27  $      (0.13)
                                                    ============  ============
         Diluted earnings per share                 $       0.27  $      (0.13)
                                                    ============  ============

  Deferred Revenue

     Payments  which are  received in advance of the  completion  of the related
     phase of a contract are recorded as deferred revenue when received. Revenue
     is  recognized  when earned based on cost  incurred to date plus  estimated
     profit margin in relation to the total estimated cost plus profit margin on
     the entire project.  Estimated  losses will be recognized in their entirety
     when they become  apparent.  Deferred revenue recorded at each of the years
     ended May 31, 2008 and 2007 is $315,652 and $0, respectively.

  Shipping and Handling Costs

     The Company  includes all shipping and handling costs together with cost of
     sales on the accompanying statements of operations.

  New Accounting Pronouncements

     In July,  2006, the FASB issued  Interpretation  (FIN) 48,  "Accounting for
     Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109".
     FIN 48,  prescribes a recognition  threshold and measurement  attribute for
     tax positions.  The Company  adopted FIN 48 at the beginning of fiscal year
     2008 and it did not  have a  material  impact  on the  Company's  financial
     statements.

     SFAS No. 157, Fair Value Measurements was issued in September,  2006 by the
     Financial  Accounting  Standards Board (the "FASB").  SFAS No. 157 provides
     guidance  for using  fair value to measure  assets and  liabilities  and is
     effective for fiscal years  beginning  after November 15, 2007. The Company
     will adopt this standard as required and adoption of this  statement is not
     expected to have a material effect on the Company's financial statements.


                                       26
<PAGE>
NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued

     SFAS No. 158,  Employers'  Accounting for Defined Benefit Pension and Other
     Postretirement  Plans  was  issued  in  September,  2006  by the  Financial
     Accounting  Standards Board. This statement requires that employers measure
     plan assets and obligations as of the balance sheet date. This  requirement
     is effective for fiscal years ending after December 15, 2008.

     In February,  2007, the FASB issued SFAS No. 159, The Fair Value Option for
     Financial Assets and Liabilities - including an amendment of FASB statement
     No. 115.  This  statement  permits all  entities  to choose,  at  specified
     elections  dates, to measure eligible items at fair value. The statement is
     effective as the first fiscal year that begins after November 15, 2007. The
     Company will adopt this standard as required and adoption of this statement
     is not  expected  to  have a  material  effect  on the  Company'  financial
     statements.

     In December,  2007, the FASB issued SFAS No. 160,  Non-controlling Interest
     in  Consolidated  Financial  Statements  - an amendment of ARB NO. 51. This
     FASB improves the financial  statement  information that a reporting entity
     provides  in  its   consolidated   financial   statements  by  establishing
     accounting  and reporting  standards.  SFAS No. 160 affects those  entities
     that  have  an  outstanding   non-controlling   interest  in  one  or  more
     subsidiaries or that deconsolidate a subsidiary.  SFAS No. 160 is effective
     for fiscal years, beginning on or after December 15, 2008.

     In December, 2007, the FASB issued SFAS No. 141R, Business Combination. The
     revised  statement  improves  on the  information  provided  by a reporting
     entity about a business combination and its effects. This statement applies
     prospectively to business  combination for which the acquisition date is on
     or after the beginning of the first annual reporting period beginning on or
     after December 15, 2008.

NOTE 3.  INVENTORIES

     The major components of inventories are as follows:

                                                        2008          2007
                                                   ------------- -------------
             Raw materials                         $    691,096  $    533,972
             Work in process                            778,633       876,981
             Finished goods                             307,606       292,211
                                                   ------------  ------------
             Total inventories                     $  1,777,335  $  1,703,164
                                                   ============  ============

     Certain allocable overhead costs such as depreciation,  insurance, property
     taxes and  utilities  are  included  in  inventory  based upon  percentages
     developed by the Company.  The aggregate  amount of these costs included in
     inventory  during the years ended May 31, 2008 and 2007,  were $589,411 and
     $559,774, respectively.

     All of the above stated inventories are that of the operating  subsidiaries
     Antenna Products Corporation and Phazar Antenna Corp. No other subsidiaries
     carry inventory.


                                       27
<PAGE>
NOTE 4.  PROPERTY AND EQUIPMENT

     The following is a summary of the  Company's  property and equipment at May
     31:

                                    Estimated
                                    Useful Life      2008          2007
                                    ----------- ------------- -------------
      Land                                      $    375,136  $    375,136
      Buildings and improvements    15-30 years    1,873,217     1,873,217
      Machinery and equipment          10 years    3,359,626     3,402,145
      Automobiles and equipment         3 years      106,898       106,898
      Office furniture and fixtures    10 years      435,210       454,266
                                                ------------  ------------
                                                   6,150,087     6,211,662
      Less accumulated depreciation               (5,211,003)   (5,158,896)
                                                ------------  ------------
      Net property and equipment                $    939,084  $  1,052,766
                                                ============  ============

NOTE 5.  INTANGIBLE ASSETS
                                                          2008         2007
                                                      ------------ ------------
    Included in intangible assets at
    May 31 are the following:
      Noncompete agreements (Phazar Antenna Corp.)    $    60,000  $    60,000
      Patents, copyrights and other
       intellectual property (Phazar Antenna Corp.)       389,593      389,593
                                                      -----------  -----------
      Accumulated amortization                            449,593      449,593
                                                         (449,593)    (449,593)
                                                      -----------  -----------
                                                      $         -  $         -
                                                      ===========  ===========

     Patents,  copyrights and other intellectual property are being amortized on
     the   straight-line   basis  over  a  weighted  average  five-year  period.
     Non-compete  agreements are being amortized on the straight-line basis over
     weighted average three and one third year contractual basis.

NOTE 6.  NOTES PAYABLE

     At May 31, 2008 and 2007, notes payable consist of a revolving note payable
     to a bank,  with a maximum amount not to exceed the lesser of $1,000,000 or
     a calculated  borrowing base  determined by a formula based upon the amount
     of certain  qualified  receivables  and  inventories as defined in the loan
     agreement.  Amount  available  under the revolving note at May 31, 2008 and
     2007 was $1,000,000.

     Interest  is  payable  monthly at the prime rate (5.0% and 8.25% at May 31,
     2008 and 2007,  respectively)  until  September  30, 2008,  when any unpaid
     principal and interest  shall be due.  Borrowings  under the revolving note
     payable are  collateralized by accounts  receivable and inventories.  Under
     the  agreement,  the Company must maintain  minimum net worth of $3,000,000
     and working capital of $1,000,000.


                                       28
<PAGE>
NOTE 7.  LONG-TERM DEBT

     At May 31, 2008 and 2007, PHAZAR CORP had no long-term debt.

NOTE 8.  INCOME TAXES

     Components of the income tax provision are as follows:
                                                         2008         2007
                                                    ------------- -------------
       Federal income taxes at statutory
        rate on income before income taxes          $    294,708  $   (154,643)

      State income taxes statutory rate                        -         1,143

      Non-deductible expenses and other                  (45,797)        2,442
                                                    ------------  ------------
      Total provision (benefit)                     $    248,911  $   (151,058)
                                                    ============  ============
      Deferred portion of provision                      (51,707)      (54,021)
      Current portion of provision                       300,618       (97,037)
                                                    ------------  ------------
      Total provision (benefit)                     $    248,911  $   (151,058)
                                                    ============  ============

     The tax  effects of  temporary  differences  that give rise to  significant
     portions  of the  deferred  tax assets and  deferred  tax  liabilities  are
     presented below:

                                                         2008         2007
                                                    ------------- -------------
      Deferred tax assets:
       Accounts receivable, due to allowance for
         doubtful accounts                          $        681  $      2,387
       Accrued expenses, due to warranty accrual          41,608        23,248
       Accrued expenses, due to vacation accrual          25,408        29,201
       Intangible assets, due to difference in
         amortization                                     68,871        77,281
       Compensation, stock options vested                 53,476        25,942
       Investments, due to impairment for book
         purposes                                        103,072             -
                                                    ------------  ------------
      Total deferred tax assets                     $    293,116  $    158,059

      Deferred tax liabilities:

       Property and equipment, principally due
        to difference in depreciation                    (46,680) $    (66,405)
                                                    ------------  ------------
      Total deferred tax liabilities                     (46,680) $    (66,405)
                                                    ------------  ------------
       Net deferred tax assets                      $    246,436  $     91,654
                                                    ============  ============





                                       29
<PAGE>
NOTE 8.  INCOME TAXES - continued

      The net deferred tax assets are classified
        on the balance sheet as follows:

       Current deferred tax assets                  $     67,697  $     54,836
       Long-term deferred tax assets (liabilities)       178,739        36,818
                                                    ------------  ------------
       Net deferred tax assets                      $    246,436  $     91,654
                                                    ============  ============

     On July 13, 2006, the FASB issued Interpretation No. 48 ("FIN"), Accounting
     for  Uncertainty  in Income  Taxes - an  Interpretation  of FASB  Statement
     No.109.  FIN 48 prescribes  how the Company should  recognize,  measure and
     present in the Company's financial  statements uncertain tax positions that
     have been taken or are  expected to be taken in a tax  return.  Pursuant to
     FIN 48, the Company can  recognize a tax benefit only if it is "more likely
     than not" that a particular tax position will be sustained upon examination
     or audit  by  taxing  authorities,  based on the  technical  merits  of the
     position. The tax benefits recognized in the financial statements from such
     a position  should be  measured  based on the  largest  benefit  that has a
     greater than fifty  percent  likelihood  of being  realized  upon  ultimate
     settlement. FIN 48 also provides guidance on derecognition, classification,
     interest and penalties on income taxes,  accounting in interim  periods and
     requires increased disclosures.

     The Company  adopted the provisions of FIN 48 on June 1, 2007. The adoption
     of FIN 48 did not result in the recording of any unrecognized tax benefits,
     as there were no identifiable uncertain tax positions that were required to
     be  quantified  and  disclosed.  Therefore,  there were no recorded  FIN 48
     liabilities or adjustments to retained earnings on the Company's  financial
     statements.

     There are no additional uncertain tax positions expected to be taken on the
     2007  federal or state  income tax  returns  to be filed.  Accordingly,  no
     additional  disclosures have been made on the current financial  statements
     regarding FIN 48.

     As  Company  policy,   accrued   interest  or  penalties   associated  with
     unrecognized  tax benefits  will be recorded as income tax  expense.  Since
     there is no applicable  FIN 48 liability for 2007, no interest or penalties
     are included in the Consolidated Statement of Operations.

     The Company and its  subsidiaries  file a consolidated  federal tax return.
     The 2004-2007  federal tax returns are currently  open under the statute of
     limitations.  State income tax returns are generally  open for  examination
     for a period of 3-5 years after the filing of the  respective  return.  The
     Company and its  subsidiaries  have no federal or state  returns  currently
     under examination, appeals or litigation.

NOTE 9.  COMMITMENTS AND CONTINGENCIES

     The  Company  has adopted an employee  profit  sharing  plan under  Section
     401(k) of the Internal  Revenue Code.  All employees  with a minimum of one
     year of  employment  are  eligible to  participate.  The Company will match
     employee  contributions for an amount up to 3% of each employee's salary if

                                       30
<PAGE>
NOTE 9.  COMMITMENTS AND CONTINGENCIES - continued

     certain earnings  requirements are met.  Contributions  are invested at the
     direction of the employee in one or more funds. Company  contributions vest
     after three years of service. Company contributions amounted to $70,237 and
     $0 for the years ended May 31, 2008 and 2007, respectively.

  Concentration of Credit Risk

     The Company  deposits  its cash  primarily in deposit  accounts  with major
     banks.  Certain cash  deposits may  occasionally  be in excess of federally
     insured limits. The Company has not incurred losses related to its cash.

     The  Company  sells  many of its  products  to the  U.S.  Government,  both
     military and civil agencies,  and prime  contractors.  Although the Company
     might be  directly  affected  by the well  being of the  defense  industry,
     management does not believe significant credit risk exists at May 31, 2008.

     Ongoing credit evaluations of customer's  financial condition are performed
     and, generally,  no collateral is required.  The Company maintains reserves
     for potential credit losses and such losses have not exceeded  management's
     expectations.

  Fair Value of Financial Instruments

     The  following   disclosure  of  the  estimated  fair  value  of  financial
     instruments is made in accordance  with the  requirements  of SFAS No. 107,
     Disclosures about Fair Value of Financial  Instruments.  The estimated fair
     value amounts have been determined by the Company,  using available  market
     information and appropriate valuation methodologies.

     The fair value of financial  instruments  classified  as current  assets or
     liabilities  including cash and cash equivalents,  receivables and accounts
     payable  approximate  carrying value due to the short-term  maturity of the
     instruments.

  Legal Proceedings

     On June 26,  2008,  the Company  filed a claim in  arbitration  against UBS
     Financial  Services,  Inc. ("UBS") with the Financial  Industry  Regulatory
     Authority,  Inc.  ("FINRA") for fraud,  breach of fiduciary duty, breach of
     contract and  negligence in connection  with the sale by UBS to the Company
     of certain "auction rate  securities" in the aggregate  principal amount of
     $2,650,000 (the auction rate securities).

     In the  arbitration  proceeding,  the Company claims it invested its liquid
     assets  in  auction   rate   securities   in  reliance   on  UBS   repeated
     representations  to the Company that the auction rate securities were safe,
     liquid investments, the equivalent of cash and a prudent investment for the
     Company's  cash.  Further,  the Company claims these  representations  were
     false and that UBS also falsely  represented  that the auction markets were
     stable and that the Company could  liquidate its  investment in the auction
     rate securities on any auction date, making the auction rate securities the
     equivalent of cash. The Company  further claims that in February 2008, with
     no prior  notice to the Company,  UBS  unilaterally  abandoned  the auction
     markets and allowed the auctions of auction rate  securities it had sold to

                                       31
<PAGE>
NOTE 9.  COMMITMENTS AND CONTINGENCIES - continued

     the Company to fail. The Company further alleges that the continued failure
     of the  auctions  has resulted in the  Company's  auction  rate  securities
     becoming  illiquid long term fixed income  investments.  The Company seeks,
     among  other  relief,  rescission  of its  purchases  of the  auction  rate
     securities and restoration in cash of its entire  $2,650,000  investment in
     the auction rate securities it purchased from UBS.

     The Company  also  announced  that on June 27, 2008,  the Company  filed an
     action against UBS in the 348th Judicial  District Court of Tarrant County,
     Texas (the  "Injunctive  Action").  In the Injunctive  Action,  the Company
     seeks injunctive relief  prohibiting UBS from denying the Company access to
     the $2,650,000 in cash the Company invested in auction rate securities.

  Product Warranties

     PHAZAR  CORP's  management  estimates  accrued  warranty  expense  based on
     warranty  work  received but not  performed  and on analysis of  historical
     trends including actual expense as a percent of sales.

     Changes in accrued  warranty  liability  for the years ended May 31, are as
     follows:

                                                          2008         2007
                                                      ------------ ------------
        Beginning balance                             $    68,376  $    41,792
        Cost incurred for rework                         (150,652)     (48,592)
        Accrual for current year estimate                 122,376       68,376
        Change in accrued estimate                         82,276        6,800
                                                      -----------  -----------
        Ending balance                                $   122,376  $    68,376
                                                      ===========  ===========

     The accrual for warranty  reserve for 2008 was increased for the recall and
     modification of a safety sleeve product.

NOTE 10. STOCK OPTIONS

     In 2000,  the board  approved  options to purchase  75,000 shares of common
     stock at $2.00 per share to an employee of the Company,  all were exercised
     before the options expiration date of November 20, 2007.

     In 2006,  the Board  approved  options to purchase  50,000 shares of common
     stock at $9.22 per share to an  employee  of the  Company.  The options are
     exercisable  pro-rata  over  a five  year  period.  No  options  have  been
     exercised. The options expire between May 29, 2012 and May 29, 2016, or the
     earlier of the employee's last day of employment.

     In 2008,  the Board  approved  options to purchase  30,000 shares of common
     stock at $5.70 per share to an  employee  of the  Company.  The options are
     exercisable at a rate of 6,000 shares per year over a five year period.  No
     options have been exercised.  The options expire between March 23, 2014 and
     March 23, 2019, or the earlier of the employee's last day of employment.



                                       32
<PAGE>
NOTE 10. STOCK OPTIONS - continued

     A summary of the status of the Company's  outstanding  stock options issued
     under  separate  employment  agreements as of May 31, 2008 and May 31, 2007
     and changes for the years then ended are as follows:
                                                     Outstanding Options
                                               ------------------------------
                                                                Weighted
                                                                Average
                                                      Number    Exercise
                                                  of Options    Price
                                                 -------------  -------------
          Outstanding at May 31, 2006                 109,000           5.31
                        Granted                             -
                        Exercised                     (20,000)          2.00
                        Forfeited                           -
                                                 ------------   ------------
          Outstanding at May 31, 2007                  89,000           6.06
                        Granted                        30,000           5.70
                        Exercised                     (39,000)          2.00
                        Forfeited                           -
                                                 ------------   ------------
          Outstanding at May 31, 2008                  80,000           7.90
                                                 ============   ============

                                                            May 31,
                                                     2008           2007
                                                 ------------   ------------
         Number of options vested                     20,000         49,000
         Weighted average remaining contract
             life - years                               6.75           4.15

         Number of options exercisable at
             May 31, 2008                             20,000

     In October  2006, a majority of the PHAZAR CORP  shareholders  approved the
     2006 Incentive  Stock Option Plan (the "Plan").  Options for 250,000 shares
     of common  stock are  authorized  under this plan.  Options  granted may be
     either  Incentive  Stock Options or  Non-Statutory  Stock  Options,  at the
     discretion of the Board. There have been no options granted under this plan
     as of May 31, 2008.

     The following table details  stock-based  compensation  expense included in
     the statement of operations for the years ended May 31, 2008 and 2007.

                                                        For the year ended
                                                              May 31,
                                                    ------------- -------------
                                                        2008           2007

       Selling, general and administrative expense  $     80,988  $     76,298
       FIT Provision                                     (27,535)      (25,941)
                                                    ------------  ------------
            Impact on net income                    $     53,453  $     50,357
                                                    ============  ============
            Impact on net income per share -
                Basic and diluted EPS               $       0.02  $       0.02

                                       33
<PAGE>
NOTE 11. LONG TERM MARKETABLE SECURITIES

     The Company accounts for marketable securities in accordance with Statement
     of Financial  Accounting  Standard  (SFAS) No. 115,  Accounting for Certain
     Investment  in Debt and  Equity  Securities.  The  Company  determined  the
     appropriate classification for its marketable securities was "available for
     sale". As such, on May 31, 2008 and 2007, all of the Company's  investments
     in marketable  securities were reported at fair value.  Unrealized  holding
     gains or losses,  net of tax are  reported  as a component  of  accumulated
     other  comprehensive  income  (loss) in  stockholders'  equity.  Fair value
     unrealized  holding  losses (net of tax) incurred were $303,160  ($200,086)
     and $0 ($0) for years ending May 31, 2008 and 2007, respectively.

                                                        2008          2007
                                                   ------------- -------------
        Marketable Securities
           Par value                               $  2,650,000  $          -
           Unrealized holding loss                     (303,160)            -
                                                   ------------  ------------
           Fair Value                              $  2,346,840  $          -

        Maturity Grouping
          Within one year                                     -             -
           Between one to five years                          -             -
           Between five to ten years                          -             -
           After ten years                            2,346,840             -
                                                   ------------  ------------
           Total                                   $  2,346,840  $          -

NOTE 12. SUBSEQUENT EVENT

     On July 11, 2008, James Miles, our President,  Chief Executive  Officer and
     Director,  resigned  from these  offices to seek  other  personal  business
     opportunities.  The Board of Directors expects to name his successor in the
     near future.

     On  August 8,  2008,  UBS  agreed to a  settlement  in  principle  with the
     Securities and Exchange  Commission  (SEC),  the New York Attorney  General
     (NYAG),  the  Massachusetts  Securities  Division  (MSD),  the Texas  State
     Securities Board and other state regulatory  agencies  represented by North
     American Securities Administrators  Association to restore liquidity to all
     remaining  clients  who hold  auction  rate  securities.  All UBS clients -
     individual investors, corporations and institutional clients - who hold ARS
     will be able to redeem their securities at par.

Item 8.  Changes  In  and  Disagreements  With  Accountants  on  Accounting  and
         Financial Disclosure.
None.

Item 8A. Controls and Procedures.

As of May 31, 2008, an evaluation was performed  under the  supervision and with
the participation of the Company's management, including the CEO and CFO, of the
effectiveness of the design and operation of the Company's  disclosure  controls
and procedures.  Based on that evaluation,  the Company's management,  including


                                       34
<PAGE>
Item 8A. Controls and Procedures. - continued

the CEO and CFO, concluded that the Company's disclosure controls and procedures
were  effective  as of May 31,  2008.  There  has not  been  any  change  in the
Company's  internal  controls  during the Company's last fiscal quarter that has
materially  affected  or is  reasonably  likely to  materially  affect  internal
controls over financial reporting as of May 31, 2008.


















































                                       35
<PAGE>
PART III

Item 9.  Directors and Executive Officers of the Registration


Name              Age Principal Occupation                        Since
----              --- --------------------                        -----

Gary W. Havener   67  President, Sinan Corp.; Past Chief
                      Executive Officer, PHAZAR CORP              January 1992

Clark D. Wraight  64  Vice President and Secretary, PHAZAR CORP;
                      President and General Manager, Antenna
                      Products Corp. and Phazar Antenna Corp.;
                      Vice President, Tumche Corp. and Thirco,
                      Inc.; Secretary, Tumche Corp., Thirco, Inc.,
                      and Phazar Antenna Corp.                    October 1996


R. Allen Wahl     80  Independent Business Consultant and
                      Past President & COO of Valmont
                      Industries                                  October 1999

James Kenney      67  Account Executive, Baldwin Anthony
                      Securities, Inc.  Past Executive Vice
                      President and Owner, San Jacinto
                      Securities, Inc.                            November 1999

Dennis Maunder    57  Past Chief Financial Officer,
                      Shared Technologies, Inc.; Controller,
                      Allegiance Telecom, Inc.                    October 2006

Garland Asher     64  Director and Chairman of Audit Committee,
                      Universal Power Group, Inc.; Past Member,
                      City of Fort Worth Audit Committee; Past
                      President and COO, Integration Concepts,
                      Inc.                                        October 2007

Deborah A. Inzer  57  Vice President, Chief Financial Officer,
                      PHAZAR CORP; Treasurer, Antenna Products
                      Corp., Phazar Antenna Corp., Tumche Corp.,
                      and Thirco, Inc.                            March 2008

     Mr.  Havener served as the President of PHAZAR CORP from January 1992 until
October  1999.  Mr.  Havener  served  as  the  President  of  Antenna   Products
Corporation  from January 1996 until April 1999. Mr. Havener served as President
and CEO of PHAZAR CORP and President of Tumche Corp. and Thirco,  Inc. from June
2000 until  October  2006.  Mr.  Havener also served as sole director of Antenna
Products Corporation,  Phazar Antenna Corp., Tumche Corp. and Thirco, Inc. until
October 2006.  Since  December  1984, Mr. Havener has served as the President of
Sinan Corp., an investment company.  Sinan Corp. is not a parent,  subsidiary or
affiliate of the Company.

     Mr.  Wraight served as Vice  President and  Secretary/Treasurer  of Antenna
Products Corporation from 1996 until April 1999 when he was appointed President.


                                       36
<PAGE>
Mr. Wraight has been employed with Antenna Products since 1979 and has served as
an officer of the  Company  since 1981.  Mr.  Wraight  currently  serves as Vice
President and Secretary of PHAZAR CORP, President and General Manager of Antenna
Products  Corporation,  President of Phazar  Antenna  Corp.,  Vice President and
Secretary of Tumche Corp.,  and Vice  President  and Secretary of Thirco,  Inc.,
subsidiaries of the Company.

     Mr.  Wahl was  President  and COO of Valmont  Industries  until  1985.  The
principal  business of Valmont  Industries is manufacturing  steel tubular poles
and  towers  for  the  lighting,   electrical   transmission  and  communication
industries. Mr. Wahl has been an independent business consultant since 1985.

     Mr.  Kenney  currently  serves as an account  executive at Baldwin  Anthony
Securities  Inc.  since  February,  2007.  Mr. Kenney  served as Executive  Vice
President and owner of San Jacinto Securities,  an institutional stock brokerage
firm from 1993 until 2007.

     Mr. Maunder  served as Vice  President,  Controller of Allegiance  Telecom,
Inc., from September 1997 through February 2000.  Allegiance Telecom, Inc. was a
local  exchange  carrier,  essentially  a  telephone  company.  In  June,  2002,
Allegiance  Telecom acquired Shared  Technologies  Inc. In May 2003,  Allegiance
Telecom and its subsidiaries,  including Shared  Technologies Inc. filed Chapter
11 bankruptcy. In the spring of 2004, Shared Technologies Inc. under an approved
plan of reorganization emerged from bankruptcy.  Mr. Maunder served as the Chief
Financial  Officer  of  Shared  Technologies  Inc.,  a  nationwide  supplier  of
telecommunications  equipment from March 2004 until October 2006. Mr. Maunder is
currently active in livestock  breeding;  participating in charitable  pursuits;
and investing activities.

     Mr. Asher has served since December, 2006 as a Director and Chairman of the
Audit  Committee of Universal  Power Group,  Inc., a power equipment and battery
distributor.  Mr.  Asher has served as a member of the City of Fort Worth  Audit
Committee  since 2006.  Mr.  Asher served as  President  and COO of  Integration
Concepts,  Inc., a healthcare software company, from September 1999 through June
2004. Since then he has been involved in personal investment activities.

     Ms.   Inzer  served  as   Controller   of  Shared   Technologies,   Inc.  a
telecommunications  company from January,  2005 until March, 2008. Ms. Inzer has
served as Vice  President,  Accounting  and Controller at Dave & and Buster's in
Dallas, Texas from 1999 to 2005 and Senior Vice President,  Accounting at AmBrit
Energy Corp in Dallas, Texas from 1989 to 1999.


COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934

     Section 16(a) of the Securities Exchange Act of 1934 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  on Form 3 and  changes  in  ownership  on  Form 4 or Form 5 with  the
Securities and Exchange  Commission  (the "SEC").  Such officers,  directors and
ten-percent  shareholders  are also required by SEC rules to furnish the Company
with copies of all Section 16(a) forms they file.





                                       37
<PAGE>
     Based  solely on its review of the copies of such forms  received by it, or
written  representations  from certain reporting  persons,  the Company believes
that,  during the fiscal  year ended May 31,  2008,  all  Section  16(a)  filing
requirements applicable to its officers,  directors and ten-percent shareholders
have been filed.

Item 10.  Executive Compensation.

The following table provides certain summary information concerning compensation
awarded  to,  earned by or paid to the Chief  Executive  Officer and other named
executive  officers  and  directors  of the Company  whose total  annual  salary
exceeded $100,000  (collective,  the "named officers") for fiscal year ended May
31, 2008.

-------------------------------------------------------------------------------
                           SUMMARY COMPENSATION TABLE
------------------------- --------------------- -------------------------------
Name & Principal Position                      Annual Compensation
------------------------- ------------- ---------- --------- ----------------
                            Fiscal Year                        Other Annual
                          Ended May 31, Salary ($)  Bonus ($) Compensation ($)
                          ------------- ----------- --------- ----------------
James Miles                        2008 $       0   $       0 $      98,000(1)
  President and CEO                                           $      22,674(2)

James Miles                        2007 $       0   $       0 $      60,591(1)
  President and CEO                                           $      10,128(2)

Clark D. Wraight                   2008 $138,914(3) $       0 $           0
  Vice President

Clark D. Wraight                   2007 $134,197(3) $       0 $           0
  Vice President

Clark D. Wraight                   2006 $129,043(3) $       0 $           0
  Vice President

Gary W. Havener                    2008 $      0    $       0 $           0
  Past President and CEO

Gary W. Havener                    2007 $      0    $       0 $      37,409(1)
  President and CEO

Gary W. Havener                    2006 $      0    $       0 $      98,000(1)
  President and CEO

         (1)    Director's Fee - Sole Director, Antenna Products Corporation
         (2)    Interim Housing Reimbursement
         (3)    Annual Compensation - President, Antenna Products Corporation

COMPENSATION OF DIRECTORS

Compensation  for PHAZAR  CORP  Board  members is set at $500 plus 200 shares of
PHAZAR CORP common stock for each board meeting attended.



                                       38
<PAGE>
Compensation  for  PHAZAR  CORP audit  committee  member is set at $250 plus 100
shares of PHAZAR CORP common stock for each audit committee meeting attended.

The following  table provides  certain summary  information  with respect to the
named director,  compensation  information  inclusive of fees paid to and shares
awarded to, all directors of the Company for fiscal year ended May 31, 2008.

<TABLE>
<S>              <C>     <C>     <C>     <C>          <C>          <C>          <C>
         Name     Fees                     Non Equity Nonqualified   All Other   Total
                 Earned   Stock  Options   Incentive    Deferred   Compensation   ($)
                 or Paid Awards   Awards     Plan     Compensation     ($)
                 in Cash   ($)     ($)   Compensation   Earnings
                    ($)                       ($)          ($)

         (a)       (b)     (c)     (d)        (e)         (f)          (g)        (h)
---------------- ------- ------- ------- ------------ ------------ ------------ -------
James Miles      $ 3,000 $ 8,350 $    0   $      0      $      0     $      0   $11,350
---------------- ------- ------- ------- ------------ ------------ ------------ -------
Clark D. Wraight $ 3,000 $ 8,350 $    0   $      0      $      0     $      0   $11,350
---------------- ------- ------- ------- ------------ ------------ ------------ -------
R. Allen Wahl*   $ 5,000 $13,836 $    0   $      0      $      0     $      0   $18,836
---------------- ------- ------- ------- ------------ ------------ ------------ -------
James Kenney*    $ 4,500 $12,616 $    0   $      0      $      0     $      0   $17,116
---------------- ------- ------- ------- ------------ ------------ ------------ -------
Gary W. Havener  $ 3,000 $ 8,350 $    0   $      0      $      0     $      0   $11,350
---------------- ------- ------- ------- ------------ ------------ ------------ -------
Dennis Maunder*  $ 5,000 $13,836 $    0   $      0      $      0     $      0   $18,836
---------------- ------- ------- ------- ------------ ------------ ------------ -------
Garland Asher*   $ 3,000 $ 7,943 $    0   $      0      $      0     $      0   $10,493
---------------- ------- ------- ------- ------------ ------------ ------------ -------
</TABLE>

* Member of Audit Committee


Item 11. Security  Ownership  of  Certain  Beneficial  Owners and Management and
         Related Stockholder Matters.

The following table set forth the beneficial  ownership of the Company's  Common
Stock as of July 15,  2008,  (a) by each  director,  (b) by the named  executive
officers,  and (c) by all  persons  known to the  Company  to be the  beneficial
owners of more than 5% of the  Company's  Common Stock and (d) all directors and
executive officers as a group.

Name and Address               Shares Owned Directly         Percent of
of Beneficial Owners (1)       and Indirectly                Class (2)
------------------------       ---------------------         ----------
Gary W. Havener (3)                   105,000                4.45%
Sinan Corp.
P.O. Box 121697
Ft. Worth, TX 76121

R. Allen Wahl                           4,300                0.18%
13 Collinway Place
Dallas, TX 75230





                                       39
<PAGE>
Clark D. Wraight                      108,300                4.58%
Antenna Products Corporation
101 S.E. 25th Ave.
Mineral Wells, TX 76067

James Kenney                            6,200                0.26%
4131 N. Central Expressway
Suite 930
Dallas, TX 75204

Dennis Maunder                          3,500                0.15%
401 Baker Cutoff Rd.
Weatherford, TX 76087

Garland P. Asher                        1,900                0.08%
2300 Mistletoe Drive
Fort Worth, TX 76110

Deborah A. Inzer                            0                0.00%
Antenna Products Corporation
101 S.E. 25th Avenue
Mineral Wells, TX 76067

All directors and officers            229,200                9.71%
of PHAZAR CORP
as a group (Seven Persons)

     (1) The persons  named  herein have sole voting and  investment  power with
         respect to all shares of Common  Stock shown as  beneficially  owned by
         them,  subject to community  property laws where applicable and subject
         to the Texas laws for personal holding companies, as applicable.

     (2) Based on total outstanding shares of 2,361,428 as of July 15, 2008

     (3) Sinan Corp.,  wholly  owned by Mr.  Havener and his  children,  owns of
         record  100,000  of  these  shares  representing  4.23%  of  the  total
         outstanding  shares.  Mr.  Havener as President of Sinan Corp. has sole
         voting and investment  power with respect to all shares of common stock
         shown as beneficially owned by Sinan Corp.

Item 12. Certain Relationships and Related Transactions.

None

Item 13. Exhibits and Reports on Form 8-K.

(a)      The following documents are filed as part of this report:

            1.  Financial Statements. See Item 7.


            2.  Financial Statement Schedules. Not applicable.

                All other schedules have  been  omitted   because  the  required
                information  is shown in the  consolidated  financials  or notes
                thereto, or they are not applicable.

                                       40
<PAGE>
            3.  Exhibits.  See Index to Exhibits  for listing of exhibits  which
                are filed herewith or incorporated by reference

(b)      Reports on Form 8-K.

            On October 6, 2004, the registrant  filed a Form 8-K for the purpose
            of disclosing the third amendment to the merger agreement related to
            the contemplated merger between PHAZAR CORP and YDI Wireless, Inc.

            On November 23, 2004 the registrant filed a Form 8-K for the purpose
            of disclosing  the agreement to terminate  the  contemplated  merger
            between PHAZAR CORP and YDI Wireless, Inc.

            On February 7, 2005, the registrant filed a Form 8-K for the purpose
            of disclosing the BAE SYSTEMS  subcontract  award granted to Antenna
            Products Corporation, a wholly owned subsidiary of PHAZAR CORP.

            On October 23, 2006, the registrant filed a Form 8-K for the purpose
            of  disclosing  the  Departure of  Directors or Principal  Officers;
            Election of Directors; Appointment of Principal Officers

            On March 26, 2008, the  registrant  filed a Form 8-K for the purpose
            of  disclosing  the  Departure of  Directors or Principal  Officers;
            Election of Directors; Appointment of Principal Officers

            On April 25, 2008, the  registrant  filed a Form 8-K for the purpose
            of disclosing the change in reporting  classification  of investment
            in auction rate securities

            On July 11, 2008, the registrant filed a Form 8-K for the purpose of
            disclosing a FINRA  arbitration claim and suit against UBS Financial
            Services

            On July 15, 2008, the registrant filed a Form 8-K for the purpose of
            disclosing  the  departure  of  Directors  or  Principal   Officers;
            Election of Directors; Appointment of Principal Officers

Item 14. Principal Accountant Fees and Services.

During fiscal year 2008 and 2007, the Company paid Weaver & Tidwell, L.L.P. fees
in the aggregate amounts noted below. All services rendered by Weaver & Tidwell,
L.L.P. were approved in advance by the Audit Committee.















                                       41
<PAGE>
                                                                May 31,
                                                           2008        2007
                                                       ----------- -----------
Audit fees
 Services rendered for year-end audit and
 quarterly reviews                                     $  60,500   $  66,280

Tax fees
 Services rendered for tax consulting due
 diligence assistance and audits of the
 Company's other entities within the
 consolidated group for statutory filing purposes      $   8,180   $   8,980
                                                       ---------   ---------
                                                       $  68,680   $  75,260
                                                       ---------   ---------






                                   SIGNATURES

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

DATE:  August 18, 2008             PHAZAR CORP

                                   /s/ Clark D. Wraight
                                   ----------------------------------------
                               BY: Clark D. Wraight
                                   Principal Executive Officer and Director
























                                       42
<PAGE>

         Pursuant to the  requirements  of the  Securities  and  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.

Signature                           Title                   Date
---------                           -----                   ----


/s/ Gary W. Havener                 Director                August 18, 2008
-------------------------------
Gary W. Havener


/s/ James Kenney                    Director                August 18, 2008
-------------------------------
James Kenney


/s/ R. Allen Wahl                   Director                August 18, 2008
-------------------------------
R. Allen Wahl


/s/ Dennis Maunder                  Director                August 18, 2008
-------------------------------
Dennis Maunder


/s/ Garland P. Asher                Director                August 18, 2008
-------------------------------
Garland P. Asher

























                                       43
<PAGE>
                                  EXHIBIT INDEX

Exhibit 3.(i)  - Registrant's    Articles   of   Incorporation,    as   amended,
                 incorporated  by reference to the like numbered  exhibit in the
                 Registrant's Annual Report on Form 10-KSB/A for the fiscal year
                 ended May 31, 2000, filed on February 20, 2004

Exhibit 3.(ii) - Registrant's  By Laws,  incorporated  by  reference to the like
                 numbered  exhibit  in the  Registrant's  Annual  Report on Form
                 10-KSB/A  for the  fiscal  year  ended May 31,  2000,  filed on
                 February 20, 2004

Exhibit 4.(ii) - Loan Agreement  between Antenna Products  Corporation and Texas
                 Bank, dated September 30, 1991 incorporated by reference to the
                 like numbered exhibit in the Registrant's Annual Report on Form
                 10-KSB/A  for the  fiscal  year  ended May 31,  2000,  filed on
                 February 20, 2004

Exhibit 10.(b) - BAE  SYSTEMS  Contract  dated  May  5,  2003   incorporated  by
                 reference  to the like  numbered  exhibit  in the  Registrant's
                 Annual Report on Form 10-KSB/A for the year ended May 31, 2003,
                 filed on February 20, 2004

                 BAE SYSTEMS  Subcontract dated April 23, 2004,  incorporated by
                 reference  to the like  numbered  exhibit  in the  registrant's
                 annual  report on Form 10-KSB for the fiscal year ended May 31,
                 2004, filed on August 6, 2004

                 Public Works and  Government  Services,  Canada,  Department of
                 Defence, dated July 15, 2004,  incorporated by reference to the
                 like numbered exhibit in the  registrant's  quarterly report on
                 Form 10-QSB for the fiscal quarter ended August 31, 2004, filed
                 on October 5, 2004.

                 BAE SYSTEMS Subcontract dated January 25, 2005, incorporated by
                 reference  to the  registrant's  Form 8-K filed on  February 7,
                 2005

                 BAE SYSTEMS  Subcontract  dated June 14, 2005,  incorporated by
                 reference  to the like  numbered  exhibit  in the  Registrant's
                 quarterly  report on Form 10-QSB for the fiscal  quarter  ended
                 August 30, 2005, filed on October 10, 2005

Exhibit  14.1  - Code of Ethics and  Business  Conduct for the Senior  Executive
                 Officers  and  Senior   Financial   Officers   incorporated  by
                 reference  to the like  numbered  exhibit  in the  registrant's
                 annual  report on form 10-KSB for the fiscal year ended May 31,
                 2004, filed on August 6, 2004.

Exhibit 21.    - A list of all  subsidiaries of the Registrant,  incorporated by
                 reference  to the like  numbered  exhibit  in the  Registrant's
                 Annual  Report on Form  10-KSB/A  for the fiscal year ended May
                 31, 2000 filed on February 20, 2004

Exhibit 31.1   - Rule  13a-14(a)/15d-14(a)   Certification  of  Chief  Executive
                 Officer

                                       44
<PAGE>
Exhibit 31.2 -   Rule  13a-14(a)/15d-14(a)   Certification  of  Chief  Financial
                 Officer

Exhibit 32.1 -   Section 1350 Certification

Exhibit 99.1 -   Nominating  Committee Charter  incorporated by reference to the
                 like  numbered  exhibit in the  Registrant's  Form 8-K filed on
                 November 7, 2005

















































                                       45