UNITED STATESSECURITIES AND EXCHANGE
COMMISSIONWashington, D.C. 20549

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FORM 10-Q

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

For the quarterly period ended March 31, 2006

OR

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

For the transition period from ________to _________

Commission file number 1-10981



SBS Technologies, Inc.



|New Mexico                                                     | 85-0359415                             
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

7401 Snaproll NE
Albuquerque, New Mexico      87109

(505) 875-0600




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

Indicate by check mark whether the registrant is an accelerated
filer (as defined in Rule 12b-2 of the Exchange Act). Yes [ P] No [  ]

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

The total number of shares outstanding of the registrant's Common Stock as of April 18, 2006 was 15,734,315.










SBS Technologies, Inc. and Subsidiaries
Form 10-Q for the Quarter Ended March 31, 2006
Table of Contents





|        |                                                                                                                            | Page
|------- | -------------------------------------------------------------------------------------------------------------------------- | ----
|        | Forward Looking Statements                                                                                                 | 2   
|PART I  | FINANCIAL INFORMATION                                                                                                      |     
|        | Item 1 - Unaudited Condensed Financial Statements                                                                          |     
|        | Consolidated Balance
SheetsAs of March 31, 2006 and June 30, 2005                                                          | 3   
|        | Consolidated Statements of
OperationsFor the three and nine months ended March 31, 2006 and
2005                           | 4   
|        | Consolidated Statement of
Changes in Stockholders' Equity and Comprehensive IncomeFor the nine months ended March 31, 2006 | 5   
|        | Consolidated Statements of
Cash FlowsFor the nine months ended March 31, 2006 and
2005                                     | 6   
|        | Notes to Condensed
Consolidated Financial StatementsAs of March 31, 2006                                                   | 7   
|        | Item 2 -Management's
Discussion and Analysis of Financial Condition and Results of
Operations                              | 18  
|        | Item 3 -Quantitative and
Qualitative Disclosures About Market Risk                                                         | 30  
|        | Item 4 -Controls and
Procedures                                                                                            | 31  
|PART II | OTHER INFORMATION                                                                                                          |     
|        | Item 1 -Legal
Proceedings                                                                                                  | 32  
|        | Item 5 -Other Information                                                                                                  | 32  
|        | Item 6 -Exhibits                                                                                                           | 32  
|        | SIGNATURES                                                                                                                 | 34  
|        | EXHIBIT INDEX                                                                                                              | 35  



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FORWARD-LOOKING
STATEMENTS

This Form 10-Q contains forward-looking statements with
respect to the financial condition, results of operations, and business of SBS
Technologies, Inc. and subsidiaries (referred to variously as "SBS,"
"we," "us" and "our").  You may find many of these
statements by looking for words like "intends," "expects,"
"projects," "believes," "anticipates" or similar
expressions in this Form 10-Q. We consider all statements regarding anticipated
or future matters, including the following, to be forward-looking
statements:

- statements regarding future events and the future
financial performance of SBS;
- the timing of the anticipated closing of the merger by
and among SBS, GE Fanuc Embedded Systems, Inc. (GE Fanuc), and GME, Inc., a
wholly owned subsidiary of GE Fanuc;
- the expectation of internally-generated cash flows;
and
- the expectation that design wins are forecasted to
produce a minimum of $500,000 in sales annually when in production.



These statements are not guarantees of our future
performance. They are based upon our assumptions and assessments only on the
date we made them and in light of our experience and our perception of
historical trends, current conditions, expected future developments, and other
factors we believe to be appropriate. Our assumptions and assessments include
the volume and product mix of sales, estimates of costs, inventory and
receivable levels based on preliminary information, and others.  Risks,
uncertainties, and other important factors could cause actual performance or
achievements to be materially different from those we may project. These risks,
uncertainties, and factors include:

- business and economic conditions generally affecting our
customers and their end customers, including but not limited to the changes in
size and program priorities of military procurement budgets, which may be less
favorable than we expect, resulting in lower sales and earnings;
- a high degree of uncertainty and rapid change in the
markets addressed by our products that could reduce sales or render certain SBS
products obsolete, resulting in reduced gross profit levels;
- customer demand for and acceptance of our products, which
may be less than we expect, affecting both sales and margins;
- our ability to design, test and introduce new products on
a timely basis, which, if we are not able, may decrease both sales and margins;
- the other risk factors listed under "Risk
Factors" included in SBS' Annual Report on Form 10-K for the year ended
June 30, 2005 filed with the SEC and available for review at www.sec.gov.



Many of the factors that will determine these items are
beyond our ability to control or predict. We caution you not to place undue
reliance on our forward-looking statements, which speak only as of the date of
this Form 10-Q.  We do not undertake any obligation to update publicly or revise
any forward-looking statements, whether as a result of new information, future
events, or otherwise.

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SBS Technologies, Inc. and
Subsidiaries
Consolidated Balance Sheets
Thousands (except share amounts)
(Unaudited)

---

`March 31,          June 30,
                                                                       2006               2005
                                                                 ----------------   ----------------
                          ASSETS
Current assets:
  Cash and cash equivalents.................................... $         53,197   $         55,195
  Receivables, net ............................................           29,578             27,535
  Inventories..................................................           26,066             21,815
  Deferred income taxes........................................            1,354              1,361
  Prepaid expenses.............................................            1,549              1,676
  Other current assets.........................................            1,563                718
                                                                 ----------------   ----------------
    Total current assets.......................................          113,307            108,300

Property and equipment, net....................................            6,575              7,635
Goodwill.......................................................           17,175             16,995
Intangible assets, net.........................................            2,163              3,108
Deferred income taxes..........................................           15,187             15,529
Other assets...................................................              898                891
                                                                 ----------------   ----------------
    Total assets............................................... $        155,305   $        152,458
                                                                 ================   ================
           LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable............................................. $          5,258   $          4,509
  Accrued representative commissions...........................              959                819
  Income taxes payable.........................................            2,160              3,051
  Accrued compensation.........................................            4,426              4,851
  Other current liabilities ...................................            3,152              3,209
                                                                 ----------------   ----------------
    Total current liabilities..................................           15,955             16,439
Other long-term liabilities....................................              187                132
                                                                 ----------------   ----------------
    Total liabilities..........................................           16,142             16,571
                                                                 ----------------   ----------------
Stockholders' equity:
  Common stock, no par value; 200,000,000 shares authorized;
    15,723,445 issued and outstanding at March 31, 2006,
    15,645,929 issued and outstanding at June 30, 2005                   100,500             98,369
  Unearned compensation .......................................             (899)               (84)
  Accumulated other comprehensive income.......................            2,435              2,014
  Retained earnings............................................           37,127             35,588
                                                                 ----------------   ----------------
    Total stockholders' equity.................................          139,163            135,887
                                                                 ----------------   ----------------
    Total liabilities and stockholders' equity................. $        155,305   $        152,458
                                                                 ================   ================`

See accompanying notes to condensed consolidated financial statements

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SBS Technologies, Inc. and
Subsidiaries
Consolidated Statements of Operations
Thousands (except per share amounts)
(Unaudited)

`Three Months Ended      Nine Months Ended
                                                            March 31,               March 31,
                                                      ---------------------   ---------------------
                                                          2006        2005        2006        2005
                                                      ---------   ---------   ---------   --------- 
Sales.............................................. $   39,274  $   37,334  $  110,696  $  114,464
Cost of sales:
  Cost of products sold............................     22,369      21,465      62,817      63,544
  Amortization of intangible assets................        261         362         781       1,179
                                                      ---------   ---------   ---------   ---------
    Total cost of sales............................     22,630      21,827      63,598      64,723
                                                      ---------   ---------   ---------   ---------
Gross profit.......................................     16,644      15,507      47,098      49,741

Selling, general and administrative expense........      8,472       8,900      25,547      26,044
Research and development expense...................      6,975       6,556      20,197      18,163
Amortization of intangible assets..................         82          77         240         228
                                                      ---------   ---------   ---------   ---------
Operating income (loss)............................      1,115         (26)      1,114       5,306
                                                      ---------   ---------   ---------   ---------
Interest and other income, net.....................        482         265       1,288         610
Foreign exchange gains (losses)....................        (36)        159         (35)       (285)
                                                      ---------   ---------   ---------   ---------
                                                           446         424       1,253         325
                                                      ---------   ---------   ---------   ---------
Income before income taxes.........................      1,561         398       2,367       5,631
Income tax expense.................................        546         142         828       1,974
                                                      ---------   ---------   ---------   ---------
Net income......................................... $    1,015  $      256  $    1,539  $    3,657
                                                      =========   =========   =========   =========


Earnings per share data:
  Net income per share............................. $     0.06  $     0.02  $     0.10  $     0.24
                                                      =========   =========   =========   =========
  Net income per share -
    assuming dilution.............................. $     0.06  $     0.02  $     0.10  $     0.23
                                                      =========   =========   =========   =========

Weighted average shares used in net income
  per share computations...........................     15,674      15,587      15,658      15,541
                                                      =========   =========   =========   =========
Weighted average shares used in net income
  per share - assuming dilution computations.......     15,823      15,763      15,742      15,732
                                                      =========   =========   =========   =========`

See accompanying notes to condensed consolidated financial statements.

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SBS Technologies, Inc. and
Subsidiaries
Consolidated Statement of Changes in Stockholders' Equity and Comprehensive Income
For Nine Months Ended March 31, 2006
Thousands (except share amounts)
(Unaudited)

`Accumulated
                                                                                    other                 Total
                                                   Common Stock         Unearned    compre-               stock-     Compre-
                                                ----------------------   compen-   hensive    Retained   holders'   hensive
                                                  Shares      Amount     sation     income    earnings    Equity     income
                                                -----------  ---------  ---------  ---------  ---------  ---------  ---------

Balances at June 30, 2005...................... 15,645,929  $  98,369  $     (84) $   2,014  $  35,588  $ 135,887
Exercise of stock options......................     60,496        706         --         --         --        706
Stock-based compensation.......................         --        286        324         --         --        610
Restricted stock awards issued to employees and
  independent directors........................     17,020      1,139     (1,139)        --         --         --
Comprehensive income:
  Net income...................................         --         --         --         --      1,539      1,539  $   1,539
  Other comprehensive income:
    Foreign currency translation adjustments...         --         --         --        421         --        421        421
                                                                                                                    ---------
    Comprehensive income.......................                                                                    $   1,960
                                                -----------  ---------  ---------  ---------  ---------  ---------  =========
Balances at March 31, 2006..................... 15,723,445  $ 100,500  $    (899) $   2,435  $  37,127  $ 139,163
                                                ===========  =========  =========  =========  =========  =========`

See accompanying notes to condensed consolidated financial statements

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SBS Technologies, Inc. and
Subsidiaries
Consolidated Statements of Cash Flows
Thousands
(Unaudited)

`Nine months ended
                                                                              March 31,
                                                                        ------------------------
                                                                            2006         2005
                                                                        -----------  -----------
Cash flows from operating activities:
  Net income.......................................................... $     1,539  $     3,657
  Adjustments to reconcile net income to net cash
    (used) provided by operating activities:
      Depreciation and amortization...................................       3,683        4,338
      Bad debt expense................................................           4           69
      Deferred income taxes...........................................         426         (122)
      Loss (gain) on disposition of assets ...........................           9           (7)
      Foreign exchange (gains) losses.................................          35          285
      Stock-based compensation........................................         610          131
      Changes in assets and liabilities:
        Receivables...................................................      (2,003)         655
        Inventories...................................................      (4,219)          71
        Prepaid expenses and other....................................        (723)      (1,160)
        Accounts payable..............................................         691       (3,720)
        Accrued representative commissions............................         139         (249)
        Income taxes..................................................        (892)       3,019
        Accrued compensation..........................................        (429)         322
        Other liabilities.............................................          (8)         505
                                                                        -----------  -----------
        Net cash (used) provided by operating activities..............      (1,138)       7,794

Cash flows from investing activities:
  Acquisition of property and equipment...............................      (1,611)      (2,596)
  Purchase of license agreement.......................................          --          (27)
                                                                        -----------  -----------
        Net cash used in investing activities.........................      (1,611)      (2,623)

Cash flows from financing activities:
  Proceeds from exercise of stock options.............................         706        1,345
                                                                        -----------  -----------
        Net cash provided by financing activities.....................         706        1,345
Effect of exchange rate changes on cash...............................          45          555
                                                                        -----------  -----------
        Net change in cash and cash equivalents.......................      (1,998)       7,071
Cash and cash equivalents at beginning of period......................      55,195       47,943
                                                                        -----------  -----------
Cash and cash equivalents at end of period............................ $    53,197  $    55,014
                                                                        ===========  ===========
Supplemental disclosure of cash flow information:
  Income taxes paid, net.............................................. $     1,044  $       113
                                                                        ===========  ===========`

See accompanying notes to condensed consolidated financial statements.

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SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements
March 31, 2006
(Unaudited)

1)	Summary of Significant
Accounting Policies



The accounting policies as set forth in SBS Technologies,
Inc.'s (SBS or the Company) Annual Report on Form 10-K for the year ended June
30, 2005 have been adhered to in preparing the accompanying interim condensed
consolidated financial statements.  These statements are unaudited but include
all adjustments, consisting of normal recurring adjustments, that SBS considers
necessary for a fair presentation of the financial position, results of
operations, and cash flows for such interim periods.  Results for such interim
periods are not necessarily indicative of results for the full fiscal year 2006
or any other future periods.

The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the amounts reported in
the Condensed Consolidated Financial Statements and accompanying notes. Actual
results could differ from these estimates.

Effective July 1, 2005, the Company adopted the provisions of
Statement of Financial Accounting Standards No. 123R, Share-Based
Payment, (SFAS 123R) using the modified prospective method.  See Note 12 for
additional information regarding stock-based compensation.

2)	Merger Agreement

On March 19, 2006, the Company entered into an Agreement
and Plan of Merger (the "Merger Agreement"), dated as of March 19,
2006, by and among the Company, GE Fanuc Embedded Systems, Inc., a Delaware
corporation ("GE Fanuc"), and GME, Inc., a New Mexico corporation and
wholly owned subsidiary of GE Fanuc ("Merger Sub").  Under the Merger
Agreement, Merger Sub will be merged with and into the Company (the
"Merger"), with the Company continuing after the Merger as the
surviving corporation and a wholly owned subsidiary of GE Fanuc. The Merger
Agreement may be terminated by either the Company or GE Fanuc under certain
circumstances, and it further provides that, upon termination of the Merger
Agreement under certain circumstances, the Company will be required to pay GE
Fanuc a customary termination fee in the amount of $9,250,000 in cash.

At the effective time of the Merger, each issued and
outstanding share of the Company's common stock, no par value (the
"Shares"), other than Shares owned by the Company, GE Fanuc or Merger
Sub, or by any shareholders who are entitled to and who properly exercise
dissenters' rights under the New Mexico Business Corporation Act, will be
cancelled and converted automatically into the right to receive $16.50 in cash,
without interest. Also at the effective time of the Merger, each outstanding
option to purchase the Company's common stock will be terminated and cancelled
and converted automatically into the right to receive a cash payment equal to
the excess, if any, of $16.50 over the per share exercise price
for each share issuable under such option.  Each restricted
stock award, to the extent the underlying shares have not been issued at
the effective time, will be terminated and cancelled and converted automatically
into the right to receive a cash payment equal to $16.50 for each share issuable
thereunder.

Consummation of the transactions contemplated by the Merger
Agreement is subject to a number of conditions, including the approval by the
holders of at least a majority of the outstanding shares of the Company's common
stock, the receipt of all regulatory approvals, including the termination or
expiration of the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and certain other customary conditions.
The Company currently anticipates having all
required shareholder, regulatory and other approvals necessary to close the
merger late in the second calendar quarter or during the third calendar quarter
of 2006.

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SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

3)	Receivables, net

Receivables, net consist of the following:

`March 31,     June 30,
Thousands                                         2006          2005
                                              -----------   -----------   
Accounts receivable........................ $     29,770  $     27,836
Less allowance for doubtful accounts.......         (192)         (301)
                                              -----------   -----------
                                            $     29,578  $     27,535
                                              ===========   ===========`

4)	Inventories

Inventories consist of the following:

`March 31,     June 30,
Thousands                                         2006          2005
                                              -----------   -----------   
Raw materials.............................. $     15,872  $      9,711
Work in process............................        3,758         3,880
Finished goods.............................        6,436         8,224
                                              -----------   -----------
                                            $     26,066  $     21,815
                                              ===========   ===========`

5)	Goodwill and Intangible Assets

The Company completed the required annual goodwill impairment
analysis for the fiscal year ended June 30, 2005, as of April 1, 2005, and the
estimated fair value of goodwill was determined to be in excess of its carrying
value, indicating the underlying goodwill was not impaired at that date.

Changes in the carrying amount of goodwill for the nine
months ended March 31, 2006 are as follows:

`Total Goodwill by Operating Segment
Thousands                                      Americas       Europe         Total
                                              -----------   -----------   -----------  
Balance at June 30, 2005................... $      3,697  $     13,298  $     16,995
Foreign currency translation adjustments ..          169            11           180
                                              -----------   -----------   -----------
Balance at March 31, 2006.................. $      3,866  $     13,309  $     17,175
                                              ===========   ===========   ===========`

See Note 11 for additional information regarding the
Company's operating segments.

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

The following table discloses information regarding the
carrying amounts and associated accumulated amortization for intangible assets
subject to amortization.

`Amortized Intangible Assets
------------------------------------------------------------------------------------
                                    Estimated      Gross                      Net
                                      useful     carrying    Accumulated   carrying
 Thousands                             life       amount     amortization   amount
                                    ----------   ---------   -----------   ---------
As of March 31, 2006                
  Current technology............... 2 - 7 yrs  $    9,508  $      8,170  $    1,338
  License agreements............... 2 - 5 yrs         227           156          71
  Covenant not to compete.......... 3 - 5 yrs       1,385           762         623
  Other intangibles................ 8 - 17 yrs        380           249         131
                                                 ---------   -----------   ---------
        Total                                  $   11,500  $      9,337  $    2,163
                                                 =========   ===========   =========
As of June 30, 2005                 
  Current technology............... 2 - 7 yrs  $    9,816  $      7,767  $    2,049
  License agreements............... 2 - 5 yrs       2,452         2,345         107
  Covenant not to compete.......... 3 - 5 yrs       2,965         2,176         789
  Other intangibles................ 8 - 17 yrs        376           213         163
                                                 ---------   -----------   ---------
        Total......................            $   15,609  $     12,501  $    3,108
                                                 =========   ===========   =========`

The net change in the gross carrying amount and accumulated
amortization balances reflected above are primarily the result of the removal of
assets which were fully amortized as of June 30, 2005 and changes as a result of
foreign currency translation adjustments.  Accordingly, the net change in
accumulated amortization for the period does not agree to amortization expense
reported in the accompanying statements of operations for the period.

The following table summarizes estimated amortization expense
for future periods as follows:

`Estimated amortization expense:                        Thousands    
  Remainder of fiscal year ending June 30, 2006..... $       332
  For the fiscal years ending:
      June 30, 2007.................................       1,254
      June 30, 2008.................................         535
      June 30, 2009.................................           5
      June 30, 2010 and thereafter..................          37
                                                       ----------
                                                     $     2,163
                                                       ==========`

6)	Revolving Line of Credit

SBS maintains a revolving line of credit agreement (Credit
Agreement) with Wells Fargo Bank National Association.  The Credit Agreement
provides for borrowings for working capital and general corporate purposes of up
to $20 million.  Effective on March 30, 2006, the Credit Agreement was
amended (Second Amendment to Credit Agreement) to extend the term of the Credit
Agreement and the revolving note for a period of one year and any outstanding
borrowings are due and payable in full on March 28, 2007.  The Credit Agreement
is secured by a first priority lien on substantially all assets of SBS.
Interest on borrowings is set forth in each promissory note executed under the
terms of the Credit Agreement and is either payable on a variable basis at the
Wells Fargo Bank prime rate or payable for a fixed rate term of either one, two
or three months at a rate of LIBOR plus 1.75%.  The terms of the Credit
Agreement, as amended, require SBS to comply with certain financial and other
covenants.

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

There have been no borrowings under the Credit Agreement
through March 31, 2006.  As of March 31, 2006, SBS was in compliance with all
financial covenants required under the terms of the amended Credit Agreement.
In addition, SBS is required to maintain its primary operating accounts with
Wells Fargo Bank or maintain a balance of not less than $20 million on deposit
with the bank. As of March 31, 2006, the Company maintains most of its primary
operating accounts with Wells Fargo Bank and our balance on deposit was in
excess of the $20 million requirement.

7) 	Accrued Compensation

In fiscal 2006, in connection with our adoption of SFAS 123R
on July 1, 2005, management reviewed and evaluated the potential impact of the
future recognition of stock-based compensation associated with stock option
grants if the Company continued to grant stock options to employees at levels
consistent with prior year grants.  Based on this evaluation, management
recommended to the Board of Directors that the Company adopt a pay-for-
performance model based on cash compensation, together with limited restricted
stock award grants, as the primary form of incentive compensation for employees.
This decision represents a change from our historical granting of stock options
to employees as the primary form of incentive compensation.  Accordingly, on
July 25, 2005, the Company's Board of Directors approved the following incentive
compensation plans: the SBS Technologies FY 2006 Employee Bonus Plan (FY 2006
EBP); the SBS Technologies FY 2006 Executive Incentive Plan (FY 2006 EIP); and
the SBS Technologies FY 2006 Long-Term Executive Incentive Plan (FY 2006 LTEIP).

FY 2006 Employee Bonus Plan

Under the FY 2006 EBP, non-executive employees of the
Company in the United States who are not covered by sales commission
arrangements are entitled to receive cash bonuses depending on the achievement
of certain specified performance goals.  The FY 2006 EBP commenced on July 1,
2005 and concludes on June 30, 2006.  Awards are targeted at 7% of an employee's
eligible income as defined in the FY 2006 EBP.  Individual awards will be based
on the Company meeting certain specified levels of (i) revenue and (ii) earnings
before interest expense, income taxes, depreciation and amortization
("EBITDA") and (iii) the achievement of individual performance goals.
The specific thresholds with respect to the the Company's performance and the
percentage weighting for the required metrics under the FY 2006 EBP were
approved by the Company's Board of Directors.  The FY 2006 EBP will be
administered in six-month performance periods that coincide with each half of
the Company's fiscal year ending on June 30, 2006.  Participants will be
entitled to receive bonuses ranging from 0% to 120% of their targeted award per
six-month performance period, depending on the level of the Company's
performance and the individual employee's performance.  In
February 2006, the Company paid approximately $400,000 of
incentive compensation from the six month period ended December 2005.  For the
three months ended March 31, 2006, management has recorded an estimate
of approximately $271,000 for incentive compensation in connection with
the FY 2006 EBP which is included under the caption accrued compensation in the
accompanying consolidated balance sheets.

FY 2006 Executive Incentive Plan

Under the FY 2006 EIP, certain designated executives
identified as participants in this plan are entitled to receive cash bonuses if
the Company's actual performance meets certain specified levels of (i) revenue
and (ii) EBITDA as established by the Board of Directors, as well as (iii) the
achievement of financial goals at different levels of the Company's operating
structure (referred to as "Division Goals") and (iv) individual
performance goals as established by the Chief Executive Officer.  The bonuses
for (iii) and (iv) are to be funded and awarded separately from the portion
awarded based on revenue and EBITDA.  The FY 2006 EIP commenced on July 1, 2005
and concludes on June 30, 2006.  The designated executives will be entitled to
receive cash incentive bonus payments up to 20% of the designated executive's
eligible income as defined in the EIP for attainment of Threshold I and up to
40% of the designated executive's eligible income for attainment of Threshold
II, depending on the level of the Company's performance, the level of financial
performance of the respective employees operating group (if applicable), and the
individual employee's performance.  In the event Company revenue

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

and EBITDA performance levels at Threshold I are not achieved, there will be no
payment attributable to these factors of the bonus.  In the event Company revenue
and EBIDTA performance levels attained are above Threshold I, but less than
Threshold II, the percentage payouts will be adjusted appropriately based on the
level of achievement.  For the nine months ended March 31, 2006, management has
recorded an estimate of approximately $220,000 for incentive compensation in
connection with the FY 2006 EIP which is included under the caption accrued
compensation in the accompanying consolidated balance sheets.

FY 2006 Long-Term Executive Incentive Plan

Under the FY 2006 LTEIP, certain designated executives
identified as participants in this plan are entitled to receive cash bonuses if
the Company's actual performance for average annual earnings per share growth
and operating margin over the three-year period beginning July 1, 2005 and
ending June 30, 2008 exceed certain performance levels (Threshold I, Threshold
II, and Threshold III) as established by the Board of Directors.  The Board also
established and approved the relative weighting that will be used to determine
the amount of the overall incentive compensation awards.  The term of the LTEIP
is July 1, 2005 through June 30, 2008.  Performance of the Company above any
Threshold but less than the next Threshold will result in a graduated
proportional pay-out; below Threshold I performance results in no pay-out.  For
the nine months ended March 31, 2006, management has recorded an estimate of
approximately $206,000 for incentive compensation in connection with the FY 2006
LTEIP which is included under the caption accrued compensation in the
accompanying consolidated balance sheets.

Restricted Stock Award under the FY 2006 LTEIP

Under the FY 2006 LTEIP, restricted stock awards, made
out of SBS' 1998 Long-Term Equity Incentive Plan, for 53,462 shares of the
Company's common stock were granted to certain designated executives on July 25,
2005.  The restrictions on the restricted stock awards lapse on June 30, 2008,
regardless of whether any cash incentive awards are paid under the LTEIP,
provided the designated executive remains an employee of the Company throughout
the term of the LTEIP.  If a change in control of SBS occurs, the shares of
restricted stock will vest on the date of the close of the change in control
transaction.  The restricted stock awards were issued under the terms of the
Company's 1998 Long-Term Equity Incentive Plan.  See discussion regarding stock-
based compensation associated with the restricted stock awards included in Note
12, "Stock-Based Compensation."

8)	Product Warranty Liability

The Company's customers receive a warranty, generally for
a period of two years, upon purchase of products.  The Company accrues estimated
costs to repair or replace potentially defective products when products are
shipped and revenue is recognized. Estimated warranty costs are based on prior
warranty costs for substantially similar products.  The following table presents
the activity in the product warranty liability for the nine months ended
March 31:

`2006         2005
Thousands                                              ----------   ----------   
Balance at beginning of period...................... $       765  $       599
  Estimated warranty costs for product sales........         315          648
  Adjustments to settle warranty activity...........        (360)        (543)
                                                       ----------   ----------
Balance at end of period............................ $       720  $       704
                                                       ==========   ==========`

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

9)	Earnings Per Share

Net income per share is based on weighted average
shares outstanding.  Net income per share - assuming dilution includes
the dilutive effects of potential common shares outstanding during the period.

`Three Months Ended        Nine Months Ended
                                                               March 31,                 March 31,
                                                       -----------------------   -----------------------
Thousands (except per share amounts)                       2006         2005         2006         2005
                                                       ----------   ----------   ----------   ---------- 
Net income.......................................... $     1,015  $       256  $     1,539  $     3,657
                                                       ==========   ==========   ==========   ========== 
Net income per share:                                                                                    
  Weighted-average common shares outstanding
    used in earnings per share computations.........      15,674       15,587       15,658       15,541
                                                       ==========   ==========   ==========   ==========
  Net income per share.............................. $      0.06  $      0.02  $      0.10  $      0.24
                                                       ==========   ==========   ==========   ========== 
Net income per share - assuming dilution:                                                                
  Weighted-average common shares outstanding
    used in earnings per share computations.........      15,823       15,763       15,742       15,732
                                                       ==========   ==========   ==========   ==========
  Net income per share - assuming dilution.......... $      0.06  $      0.02  $      0.10  $      0.23
                                                       ==========   ==========   ==========   ========== 
Shares Used in Per Share Computations:                                                                   
  Weighted average common shares outstanding........      15,674       15,587       15,658       15,541
  Incremental shares from assumed conversions -
    potential common shares ........................         149          176           84          191
                                                       ----------   ----------   ----------   ----------
  Shares used in computations - assuming dilution...      15,823       15,763       15,742       15,732
                                                       ==========   ==========   ==========   ==========`

For the three and
nine month periods ended March 31, 2006, options to purchase 2,617,610
and 2,844,474  shares of common stock, respectively, were outstanding but were
not included in the computation of earnings per share - assuming dilution
because the options' exercise prices were greater than the average market price
of the common shares.  For the three and nine month periods ended March 31,
2005, options to purchase 1,815,393 and 1,637,212 shares of common stock,
respectively, were outstanding but were not included in the computation of
earnings per share - assuming dilution because the options' exercise prices were
greater than the average market price of the common shares.

10)	Comprehensive Income

Comprehensive income for the three and nine months ended
March 31, 2006 was $2.0 million.  Comprehensive income (loss) for the three and
nine months ended March 31, 2005 was $(2.3) million and $6.9 million,
respectively.  The difference between comprehensive income and net income was
related to foreign currency translation adjustments.

11)	Segment Financial Data

The Company is engaged in the design, research,
development, integration and production of embedded computer products and we
operate worldwide through two operating segments: the Americas Group and the
Europe Group.  Both the Americas Group and the Europe Group offer our complete
portfolio of embedded computer products to customers in the government,
commercial and communications end markets.  Each segment has management who
reports directly to the Company's Chief Executive Officer and its own sales and
distribution channels.  The Americas Group consists of the Company's operations
based in the United States and Canada including the sales, engineering

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

and test activities in Albuquerque, New Mexico; Mansfield, Massachusetts; Newark,
California; Raleigh, North Carolina; St. Paul, Minnesota; and Waterloo, Ontario,
Canada; the manufacturing and assembly operations located in St. Paul, Minnesota
and Albuquerque, New Mexico; and the sales and support activities based in
Shenzhen, China.  The Europe Group consists of the Company's operations based in
Germany which include the sales, engineering, test, assembly, and manufacturing
activities located in Augsburg and Mindelheim, Germany.

SBS measures the results of operations for segments (segment
profit (loss)) based on income before income taxes and prior to (a) the
allocation of corporate overhead expenses other than marketing costs, (b)
substantially all amortization associated with acquisitions and (c) interest and
other income from our U.S. operations.  The accounting policies used to measure
segment profit (loss) are the same as those referred to in Note 1.

`Americas     Europe      Corporate &
Thousands                                         Group       Group     Unallocated (1)    Total
                                                ---------   ---------   --------------   ---------
Three month periods ended March 31
  Gross sales.........................  2006  $   25,411  $   18,168  $            --  $   43,579
  Inter-segment sales.................            (1,328)     (2,977)              --      (4,305)
                                                ---------   ---------   --------------   ---------
  Sales to external customers.........        $   24,083  $   15,191  $            --  $   39,274

  Gross sales.........................  2005  $   24,759  $   17,258  $            --  $   42,017
  Inter-segment sales.................            (1,889)     (2,794)              --      (4,683)
                                                ---------   ---------   --------------   ---------
  Sales to external customers.........        $   22,870  $   14,464  $            --  $   37,334

  Segment profit (loss)................ 2006  $    2,580  $    2,359  $        (3,378) $    1,561
                                        2005  $      183  $    3,043  $        (2,828) $      398

Nine month periods ended March 31
Gross sales...........................  2006  $   73,853  $   50,568  $            --  $  124,421
Inter-segment sales...................            (6,538)     (7,187)              --     (13,725)
                                                ---------   ---------   --------------   ---------
Sales to external customers...........        $   67,315  $   43,381  $            --  $  110,696

Gross sales...........................  2005  $   78,574  $   49,479  $            --  $  128,053
Inter-segment sales...................            (5,231)     (8,358)              --     (13,589)
                                                ---------   ---------   --------------   ---------
Sales to external customers...........        $   73,343  $   41,121  $            --  $  114,464

Segment profit (loss)                   2006  $    4,859  $    7,629  $       (10,121) $    2,367
                                        2005  $    5,613  $    9,309  $        (9,291) $    5,631

Total assets
                  As of March 31, 2006        $   33,510  $   45,349  $        76,446  $  155,305
                   As of June 30, 2005        $   34,349  $   38,067  $        80,042  $  152,458`



|(1)The corporate and unallocated column includes
amounts for corporate items.  With regard to results of operations, corporate
and unallocated includes corporate overhead expenses other than corporate
marketing costs, interest income and interest expense from our U.S. operations,
and substantially all amortization associated with acquisitions.  Corporate
assets primarily include cash and cash equivalents from our U.S. operations,
deferred and current income tax assets, goodwill and intangible assets.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

12)	Stock-Based Compensation

Effective on July 1, 2005, the Company adopted SFAS 123R
using the modified prospective method.  SFAS 123R requires measurement of
compensation cost for all stock-based awards at fair value on the grant date and
recognition of compensation expense over the requisite service period for awards
expected to vest.  The fair value of stock option grants is determined using the
Black-Scholes valuation model, which is consistent with our valuation techniques
previously utilized for options in footnote disclosures required under SFAS No.
123, Accounting for Stock Based Compensation, (SFAS 123) as amended by
SFAS No. 148, Accounting for Stock-Based Compensation - Transition and
Disclosure (SFAS 148).  The fair value of restricted stock awards is
determined based on the number of shares granted and the quoted price of our
common stock on the grant date. Such fair values will be recognized as
compensation expense over the requisite service period, net of estimated
forfeitures, using the accelerated method under SFAS 123R.

The fair value method under SFAS 123R is similar to the fair
value method under SFAS 123 as amended by SFAS 148 with respect to measurement
and recognition of stock-based compensation.  However, SFAS 123 permitted us to
recognize forfeitures as they occur, while SFAS 123R requires us to estimate
future forfeitures and adjust our estimate on a quarterly basis.  SFAS 123R also
requires a classification change in the statement of cash flows; whereby, the
income tax benefits from stock option exercises are reported as a financing cash
flow rather than an operating cash flow as previosly reported.

The Company has several Board and shareholder approved stock
option plans for which stock options and restricted stock awards are available
to grant to employees and directors.  All employee and director stock options
granted under the Company's stock option plans have an exercise price equal to
the market value of the underlying common stock on the grant date.  There are no
vesting provisions tied to performance conditions for any options as vesting for
all outstanding option grants was based only on continued service as an employee
of the Company.  All of the Company's outstanding stock options and restricted
stock awards are classified as equity instruments.

On April 21, 2005, the Board of Directors of SBS approved the
acceleration of the vesting of all outstanding unvested stock options with an
exercise price greater than $9.22 (the Acceleration).  The Acceleration was
effective for all such options outstanding on April 21, 2005, all of which were
granted by the Company when the Company used the intrinsic-value method of
accounting for stock options. All of the other terms and conditions applicable
to such outstanding stock option grants still apply.  The Company's decision to
accelerate the vesting of these options was in anticipation of compensation
expense to be recorded subsequent to the effective date of the Company's
adoption of SFAS 123R in connection with outstanding unvested stock options
issued to employees.

As a result of the Acceleration, options to purchase
approximately 1.3 million shares of SBS' common stock became immediately
exercisable on April 21, 2005. Due to the Acceleration, the Company will not
recognize stock-based compensation expense of approximately $2.5 million in
fiscal years ending June 30, 2006 and beyond (estimated using the Black-Scholes
fair value model).  The stock-based compensation expense which otherwise would
have been reported in future periods, has been reflected in pro forma footnote
disclosures for periods prior to the adoption of SFAS 123R, as permitted under
the provisions of SFAS 123 prior to its revision.

Stock Options

On the date of adoption of SFAS 123R, there were 3,397,414
outstanding stock options, of which 3,296,080 were fully vested.  There were no
stock option grants during the three months ended March 31, 2006.  During the
six months ended December 31, 2005, 122,094 stock options were granted to the
Company's independent directors in connection with their election to serve on
the Company's Board of Directors at the 2005 Annual Meeting of Shareholders.
Based on the terms of the Company's stock option plans, 69,000 of these options
vest upon the completion of service on the
board for the 2005/2006 term in November 2006 and 53,094 of
these options vest ratably on annual aniversary dates for three years from the
grant date.  The per share weighted average fair value of

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

the options granted
was $4.84.  The estimated fair value was determined using the Black-Scholes
option valuation model with the following weighted average assumptions based on
prior experience for option grants to the Company's independent directors:
expected term (years) - 3.7 to 5.7; risk free interest rate - 4.4%; expected
volatility - 57%; and dividend yield - 0%.

For the three and nine months ended March 31, 2006, the
Company recorded approximately $149,000 and $286,000, respectively, of stock-
based compensation associated with outstanding unvested stock options in
selling, general and administrative expense in the accompanying consolidated
statements of operations.  As of March 31, 2006, there was approximately
$533,000 of remaining unamortized stock-based compensation associated with
unvested stock options which will be expensed over the remaining service periods
through November 2008.

The following table summarizes our stock option activity in
fiscal 2006:

`Weighted avg
                                      Number of     Exercise
                                       options        Price
                                     -----------   ----------- 
Outstanding at June 30, 2005          3,397,414  $      14.39

  Granted                               122,094          9.92
  Exercised                              60,496         11.67
  Cancelled                             147,372         17.66
                                     -----------
Outstanding at March 31, 2006         3,311,640  $      14.13
                                     ===========

As of March 31, 2006:
  Options exercisable                 3,096,546
                                     ===========
  Shares available for grant          2,327,030
                                     ===========`

Significant option groups outstanding and exercisable at
December 31, 2005 and related weighted average price and life information
follows:

`Weighted
                                     Average     Weighted                 Weighted
                                    Remaining    Average                  Average
      Range of           Number    Contractual   Exercise     Number      Exercise
  Exercise Prices     Outstanding  Life (yrs)     Price    Exercisable     Price    
--------------------  ------------ -----------  ---------- ------------  ----------
 $  5.44 - $ 10.75        675,263      6.7     $     9.24      460,169  $     9.29
 $ 10.77 - $ 12.49        836,677      6.8          12.05      836,677       12.05
 $ 12.69 - $ 14.50        787,050      5.7          13.63      787,050       13.63
 $ 14.61 - $ 17.00        705,150      3.9          15.79      705,150       15.79
 $ 18.22 - $ 34.50        307,500      4.7          27.98      307,500       27.98
                      ------------ -----------  ---------- ------------  ----------
 $  5.44 - $ 34.50      3,311,640      5.7     $    14.13    3,096,546  $    14.47
                      ============                         ============`

Restricted Stock Awards

For the three and nine months ended March 31, 2006,
approximately $130,000 and $324,000, respectively, of stock-based compensation
associated with restricted stock awards was recorded in selling, general and
administrative expense in the accompanying consolidated statements of
operations. As of March 31, 2006, there was approximately $899,000 of remaining
unamortized deferred compensation associated with restricted stock awards,
reflected as a

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

separate component of stockholders' equity in the accompanying
consolidated condensed balance sheets, which will be expensed over the remaining
service period through February 2009.

On the date of adoption of SFAS 123R, there were 17,020
outstanding restricted stock awards issued to Independent Directors in 2004 in
connection with their service on the Company's Board of Directors.
The restricted stock awards vested in November 2005 upon
completion of the 2004/2005 term and the trading restrictions will be removed
equally over a three-year period from the date of grant.
The fair value of these awards was based on the closing price of the Company's
common stock on the grant date.  The total compensation of approximately
$249,000 was amortized to expense over the requisite service period to November
2005.  For the six months ended December 31, 2005, the Company recorded
approximately $86,000 of stock-based compensation associated with these
restricted stock awards.  There was no compensation recorded in connection with
the 2004/2005 restricted stock awards in the three months ended March 31,
2006.

On July 25, 2005, restricted stock awards for 53,462 shares
of the Company's common stock were granted to certain designated executives in
connection with the FY 2006 LTEIP.  The restricted stock awards vest on June 30,
2008 provided the designated executive remains an employee of the Company
through June 30, 2008.  In the event of a change in control of SBS, the shares
of restricted stock will vest on the date of the close of the change in control
transaction.  The restricted stock awards were issued under the Company's 1998
Long-Term Equity Incentive Plan.  The fair value for each of the 53,462
restricted stock awards granted was $10 per share based on the closing price of
the Company's common stock on July 25, 2005.  The total compensation of $534,620
was recorded as deferred compensation and will be amortized to expense over the
requisite service period from July 2005 to June 2008.  For the three and nine
months ended March 31, 2006, the Company recorded approximately $46,000 and
$121,000, respectively, of stock-based compensation associated with the FY 2006
LTEIP restricted stock awards.

On November 17, 2005, restricted stock awards for 26,985
shares of the Company's common stock were granted to Independent Directors in
connection with their service on the
Company's Board of Directors.
The restricted stock awards vest upon the completion of the 2005/2006
term in November 2006 and the trading restrictions will be removed equally over
a three-year period from the grant date.  The fair value of
these awards of $9.96 was based on the closing price of the Company's common
stock on the grant date.  The total compensation of approximately $268,800 was
recorded as deferred compensation and will be amortized to expense over the
requisite service period from November 2005 to November 2006.  For the three and
nine months ended March 31, 2006, the Company recorded approximately $67,000 and
$100,000, respectively, of stock-based compensation associated with these
restricted stock awards.

On February 6, 2006, restricted stock awards for 30,000
shares of the Company's common stock were granted to employees.  The restricted
stock awards vest ratably on the first, second and third anniversary from the
grant date provided the employee remains with the Company.  The restricted stock
awards were issued under the Company's 2000 Long-Term Equity Incentive Plan.
The fair value for each of the 30,000 restricted stock awards granted was $11.18
per share based on the closing price of the Company's common stock on February 6,
2006.  The total compensation of $335,400 was recorded as deferred
compensation and will be amortized to expense over the requisite service period
from February 2006 to February 2009.  For the three and nine months ended March 31,
2006, the Company recorded approximately $17,000 of stock-based compensation
associated with these restricted stock awards.

---



SBS Technologies, Inc. and
Subsidiaries
Notes to Condensed Consolidated Financial Statements - Continued
March 31, 2006
(Unaudited)

Fair Value Disclosures - Prior to Adoption of SFAS
123R

Prior to July 1, 2005, the Company accounted for stock-based
awards under the intrinsic value method, which followed the recognition and
measurement principles of APB Opinion No. 25, Accounting for Stock Issued to
Employees, and related interpretations. Under this method, compensation
expense was recorded on the date of grant only if the current market price of
the underlying stock exceeded the exercise price. Substantially all stock-based
compensation reflected in reported net income related to restricted stock award
grants to members of the Company's Board of Directors.  The following table
illustrates the effect on net income and net income per common
share in prior periods if the Company had applied the fair value recognition
provisions of SFAS 123 to stock-based employee compensation prior to adoption of
SFAS 123R.

`Three months  Nine months
                                                                             ended         ended
                                                                            Mar. 31,      Mar. 31,
Thousands (except per share amounts)                                          2005          2005
                                                                          -----------   ---------- 
Net income, as reported................................................ $        256  $     3,657
Stock-based compensation, net of tax effects:
     Add: compensation included in reported net income.................           38           80
     Deduct: compensation determined under fair value method...........         (878)      (1,940)
                                                                          -----------   ----------
Pro forma net income (loss)............................................ $       (584) $     1,797
                                                                          ===========   ==========
Net income per common share, as reported............................... $       0.02  $      0.24
                                                                          ===========   ==========
Net income (loss) per common share, pro forma.......................... $      (0.04) $      0.12
                                                                          ===========   ==========
Net income per common share - assuming dilution, as reported........... $       0.02  $      0.23
                                                                          ===========   ==========
Net income (loss) per common share - assuming dilution, pro forma...... $      (0.04) $      0.11
                                                                          ===========   ==========`

13)	Contingencies

SBS is subject to various claims that arise in the
ordinary course of its business. In the opinion of management, the amount of
ultimate liability with respect to these actions will not materially affect the
financial position, results of operations, or liquidity of SBS.



---



Item 2- Management's Discussion and Analysis of
Financial Condition and Results of Operations

For a description of SBS' critical accounting policies and an
understanding of the significant factors that influenced SBS' performance during
the three and six months ended December 31, 2005 and 2004, this "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
(MD&A) should be read in conjunction with the consolidated financial
statements, including the related notes, appearing in Item 1 of this Form 10-Q,
as well as our Annual Report on Form 10-K for the year ended June 30, 2005.

Company Overview

We design and build open-architecture embedded computer products that
enable OEMs to serve the government, commercial, and communications end markets.
Embedded computer products are put inside or made part of larger systems to
process information, control machines, move computer data between machines, and
interact with people.  The companies that use our products manufacture very
sophisticated, expensive devices, such as MRI machines, flight simulators,
wireless networks, fighter jets and industrial robots.

The SBS product line is strategically focused on embedded computing, and we
serve virtually all parts of the market.  We currently list more than 550
products in the product section of our website, www.sbs.com.  We offer components like
I/O modules, bus adapters, carrier cards, system enclosures, FPGA boards and
single board computers, as well as network switches, blades and fully integrated
systems. Many of these products are available in ruggedized versions, which can
operate in conditions of extreme temperature, vibration, shock and humidity.  We
serve a broad range of customers. We help our customers get to market faster,
more reliably and more economically, by providing a wide range of standard and
customized embedded computer products.  Our products have application in diverse
industries, including space and aviation, telecommunications, military and
government, transportation, robotics, networking, broadcasting, wireless
communications and medical imaging.

The embedded computer industry is highly competitive and fragmented.  The
size of the total addressable embedded computer market has been estimated by
industry publications to be approximately $4 billion for board-level products,
exclusive of complete embedded computer systems.  This market is addressed by
many competitors.  No single competitor holds a dominant position in the
embedded computer market.

We have grown because we understand our role in the embedded computing
process: we make components which are part of larger, more complicated devices.
As embedded computer applications expand, we broaden our product line to meet
our customers' needs and to attract new customers. We invest in technology and
customer service so that we can grow with our customers.  We have grown
organically and through strategic acquisitions, acquiring companies that
supplement our core competencies.  Our organic growth is driven by adding new
products, improving existing products through our research and development
program, and attracting new customers with our products and service. We have
completed eleven acquisitions since 1992 that broadened our product offerings
and our customer base.

On March 19, 2006, the Company entered into an Agreement and Plan of Merger
(the "Merger Agreement"), dated as of March 19, 2006, by and among the
Company, GE Fanuc Embedded Systems, Inc., a Delaware corporation ("GE
Fanuc"), and GME, Inc., a New Mexico corporation and wholly owned
subsidiary of GE Fanuc ("Merger Sub").  Under the Merger Agreement,
Merger Sub will be merged with and into the Company (the "Merger"),
with the Company continuing after the Merger as the surviving corporation and a
wholly owned subsidiary of GE Fanuc.  The Merger Agreement may be terminated by
either the Company or GE Fanuc under certain circumstances, and it further
provides that, upon termination of the Merger Agreement under certain
circumstances, the Company will be required to pay GE Fanuc a customary
termination fee.

At the effective time of the Merger, each issued and outstanding share of the
Company's common stock, no par value (the "Shares"), other than Shares
owned by the Company, GE Fanuc or Merger Sub, or by any shareholders who are
entitled to and who properly exercise dissenters' rights under the New Mexico
Business Corporation Act, will be cancelled and converted automatically into the
right to receive $16.50 in cash, without interest. Also at the effective time of
the Merger, each outstanding option to purchase the Company's common stock will
be terminated and cancelled and converted automatically into the right to
receive a cash payment equal to the excess, if any, of $16.50 over the per
share exercise price for each share issuable under such option.  Each restricted
stock award, to the extent the underlying shares have not been issued at
the effective time, will be terminated and cancelled and converted automatically
into the right to receive a cash payment equal to $16.50 for each share issuable
thereunder.

For more information, see the Agreement and Plan of Merger which was included
as an exhibit to a Form 8-K filed by the Company on March 23, 2006 available at
www.sec.gov.

---



Consummation of the transactions contemplated by the Merger Agreement is
subject to a number of conditions, including the approval by the holders of at
least a majority of the outstanding shares of the Company's common stock, the
receipt of all regulatory approvals, including the termination or expiration of
the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended, and certain other customary conditions.  The Company currently
anticipates having all required shareholder, regulatory and other approvals
necessary to close the merger late in the second calendar quarter or during the
third calendar quarter of 2006.

Executive Summary

During the quarter and nine months ended March 31, 2006:

- Sales for the quarter were $39.3 million and sales for the nine months were
$110.7 million;

On a sequential basis, total sales increased 5.3%, compared to $37.3 million
in sales for the quarter ended December 31, 2005.
Sales for the nine months decreased 3.3%, compared to $114.5 million in
sales for the comparable period of the prior fiscal year.

- Net income for the quarter was $1.0 million and net income for the nine
months was $1.5 million.  Net income per share - assuming dilution for the
quarter was $0.06 compared to $0.02 for the comparable period of the prior year.
Net income per share - assuming dilution for the nine months was $0.10 compared
to $0.23 for the comparable period of the prior year.
- Customer orders received and booked during the quarter and nine months were
$40.9 million and $118.3 million, respectively.  This resulted in a book-to-bill
ratio of 1.04 to 1 for the quarter and 1.07 to 1 for the nine-month period.

Book-to-bill ratio represents the net value of customer orders received
and booked each period divided by total sales. Historically, 30% to 40% of our
sales in each fiscal quarter will be based on orders received and booked during
that same fiscal quarter.

- Order backlog was $51.8 million as of March 31, 2006, compared to $49.9
million at the end of the preceding quarter on December 31, 2005 and $45.1
million as of March 31, 2005;

Order backlog represents customer orders that have been contracted for
future delivery. Accordingly, these orders have not yet been recognized as
revenue, but represent potential future revenue.

- We achieved twelve design wins during the quarter, bringing the total to
thirty-eight for the first nine months of fiscal year 2006 ended March 31, 2006.
This compares with twenty-one design wins achieved during the first nine months
of the prior fiscal year.

In the government and commercial markets, each reported design win
represents a minimum initial purchase order of $100,000; in the communications
market, each reported design win represents a minimum initial purchase order of
$10,000.  All design wins are forecasted to produce a minimum of $500,000 in
sales annually when in production.

By end market, the design wins included seven in the government market,
four in the communications market and one in the commercial market.

- For the quarter ended March 31, 2006, as a percentage of total sales, sales
to one communications customer, Ericsson, represented 19%, sales to one
commercial customer, Applied Materials, represented 6%, and no other customer
represented more than 5% of sales.

---



Financial Highlights

Selected financial highlights during the three and nine month periods
ended March 31, 2006 compared to the same periods of the prior fiscal year
and the preceding quarter ended December 31, 2005 follows:

`Three Months Ended                       Nine Months Ended
                          ------------------------------------------------   ---------------------------
                                  March 31,                                          March 31,
Thousands (except         -------------------    %       Dec. 31,    %       -------------------    %
  per share amounts)          2006       2005  change      2005    change        2006       2005 change
                          --------   -------- --------   -------- --------   --------   -------- ------- 
Sales.................. $  39,274  $  37,334      5.2% $  37,284      5.3% $ 110,696  $ 114,464    -3.3%
                          ========   ========            ========            ========   ========

Net income............. $   1,015  $     256    296.5% $   1,064     -4.6% $   1,539  $   3,657   -57.9%
                          ========   ========            ========            ========   ========

Net income per share
  - assuming dilution.. $    0.06  $    0.02           $    0.07           $    0.10  $    0.23
                          ========   ========            ========            ========   ========`

See detailed analysis of the financial results below.

Stock-Based Compensation

Effective on July 1, 2005, we adopted the provisions of Statement of
Financial Accounting Standards No. 123R, Share-Based Payment, (SFAS
123R) using the modified prospective method.  SFAS 123R requires measurement of
compensation cost for all stock-based awards at fair value on the grant date and
recognition of compensation expense over the requisite service period for awards
expected to vest.

The fair value method under SFAS 123R is similar to the fair value method
under SFAS No. 123, Accounting for Stock Based Compensation, (SFAS 123)
as amended by SFAS No. 148, Accounting for Stock-Based Compensation -
Transition and Disclosure (SFAS 148) with respect to measurement and
recognition of stock-based compensation.  However, SFAS 123 permitted us to
recognize forfeitures as they occur, while SFAS 123R requires us to estimate
future forfeitures and adjust our estimate on a quarterly basis.  SFAS 123R also
requires a classification change in the statement of cash flows; whereby, the
income tax benefit from stock option exercises is reported as a financing cash
flow rather than an operating cash flow as previously reported.

We have several Board and shareholder approved stock option plans from which
stock options and restricted stock awards are available to grant to employees
and directors.  All employee and director stock options granted under our stock
option plans have an exercise price equal to the market value of the underlying
common stock on the grant date.  There are no vesting provisions tied to
performance conditions for any option, as vesting for all outstanding option
grants was based only on continued service as an employee of SBS.  All of our
outstanding stock options and restricted stock awards are classified as equity
instruments.

On April 21, 2005, our Board of Directors approved the acceleration of the
vesting of all outstanding unvested stock options with an exercise price greater
than $9.22 (the Acceleration).  The Acceleration was effective for all such
options outstanding on April 21, 2005, all of which were granted by us when we
used the intrinsic-value method of accounting for stock options.  All of the
other terms and conditions applicable to such outstanding stock option grants
still apply.  Our decision to accelerate the vesting of these options was in
anticipation of compensation expense to be recorded subsequent to the effective
date of SFAS 123R on July 1, 2005 in connection with outstanding unvested stock
options issued to employees.  As a result of the Acceleration, options to
purchase approximately 1.3 million shares of SBS' common stock became
immediately exercisable on April 21, 2005.  Due to the Acceleration, SBS will
not recognize stock-based compensation expense of approximately $2.5 million in
fiscal years ending
June 30, 2006 and beyond (estimated using the Black-Scholes fair value model).

Stock Options

On the date of adoption of SFAS 123R, there were 3,397,414 outstanding
stock options, of which 3,296,080 were fully vested.

During the three months ended March 31, 2006, there were no stock options
granted.  During the quarter ended December 31, 2005, 122,094 stock options were
granted to the Company's independent directors in connection with their election
to serve on the Company's Board of Directors at the 2005 Annual Meeting of
Shareholders.  Based on the terms of the Company's stock option plans, 69,000 of
these options vest upon the completion of service on the board for the 2005/2006
term in November 2006 and 53,094 of these options vest ratably on annual
aniversary dates for three years from the grant date.  The per share weighted
average fair value of the options granted was $4.84.  The estimated fair value
was determined using the Black-Scholes option valuation

---

model with the following
weighted average assumptions which are based on prior experience for option
grants to the Company's independent directors: expected term (years) - 3.7 to
5.7; risk free rate of interest - 4.4%; expected volatility - 57%; and dividend
yield - 0%.

For the three and nine months ended March 31, 2006, we recorded approximately
$149,000 and $286,000, respectively, of stock-based compensation associated with
outstanding unvested stock options in selling, general and administrative
expense.  There was approximately $533,000 of remaining unamortized stock-based
compensation expense associated with unvested stock options at March  31, 2006
which will be recognized over the remaining service period through November
2008.

Restricted Stock Awards

For the three and nine months ended March 31, 2006, approximately
$130,000 and $324,000, respectively, of stock-based compensation associated with
restricted stock awards was recorded in selling, general and administrative
expense.  At March 31, 2006, there was approximately $899,000 of remaining
unamortized deferred compensation associated with restricted stock awards,
reflected as a separate component of stockholders' equity in the accompanying
consolidated condensed balance sheets, which will be recognized as stock-based
compensation expense over the remaining service period through February
2009.

Managements Evaluation of Incentive Compensation Plans

In fiscal 2006, in connection with our adoption of SFAS 123R on July 1,
2005, management reviewed and evaluated the potential impact of the future
recognition of stock-based compensation associated with stock option grants if
we continued to grant stock options to employees at levels consistent with prior
year grants.  Based on this evaluation, management recommended to the Board of
Directors that we adopt a pay-for-performance model based on cash compensation,
together with limited restricted stock award grants, as the primary form of
incentive compensation for employees.  This decision represents a change from
our historical granting of stock options to employees as the primary form of
incentive compensation.  As a result, on July 25, 2005, our Board of Directors
approved the following incentive compensation plans: the SBS Technologies FY
2006 Employee Bonus Plan (FY 2006 EBP); the SBS Technologies FY 2006 Executive
Incentive Plan (FY 2006 EIP); and the SBS Technologies FY 2006 Long-Term
Executive Incentive Plan (FY 2006 LTEIP).

FY 2006 Employee Bonus Plan

Under the FY 2006 EBP, non-executive employees of SBS in the United
States who are not covered by sales commission arrangements are entitled to
receive cash bonuses depending on the achievement of certain specified
performance goals.  The FY 2006 EBP commenced on July 1, 2005 and concludes on
June 30, 2006.  Awards are targeted at 7% of an employee's eligible income as
defined in the FY 2006 EBP.  Individual awards will be based on SBS meeting
certain specified levels of (i) revenue and (ii) earnings before interest
expense, income taxes, depreciation and amortization ("EBITDA") and
(iii) the achievement of individual performance goals.  The specific thresholds
with respect to SBS' performance and the percentage weighting for the required
metrics under the FY 2006 EBP were approved by our Board of Directors.  The FY
2006 EBP will be administered in six-month performance periods that coincide
with each half of our fiscal year ending on June 30, 2006.  Participants will be
entitled to receive bonuses ranging from 0% to 120% of their targeted award per
six-month performance period, depending on the level of SBS' performance and the
individual employee's performance.  In February 2006, the Company paid
approximately $400,000 of incentive compensation from the six month period ended
December 2005.  For the three months ended March 31, 2006, management has
recorded an estimate of approximately $271,000 for incentive compensation in
connection with the FY 2006 EBP.

FY 2006 Executive Incentive Plan

Under the FY 2006 EIP, certain designated executives identified as
participants in this plan are entitled to receive cash bonuses if our actual
performance meets certain specified levels of (i) revenue and (ii) EBITDA as
established by the Board of Directors, as well as (iii) the achievement of
financial goals at different levels of our operating structure (referred to as
"Division Goals") and (iv) individual performance goals as established
by the Chief Executive Officer.  The bonuses for (iii) and (iv) are to be funded
and awarded separately from the portion awarded based on revenue and EBITDA.
The FY 2006 EIP commenced on July 1, 2005 and concludes on June 30, 2006.
Designated executives will be entitled to receive cash incentive bonus payments
up to 20% of the designated executive's eligible income as defined in the EIP
for attainment of Threshold I and up to 40% of the designated executive's
eligible income for attainment of Threshold II, depending on the level of SBS'
performance, the level of financial performance of the respective employee's
operating group (if applicable), and the individual employee's performance.  If
our revenue and EBITDA performance levels at Threshold I are not achieved, there
will be no payment attributable to these factors of the bonus.  If our revenue
and EBIDTA performance levels attained are above Threshold I, but less than
Threshold II, the percentage payouts will be adjusted appropriately based on the
level of achievement.  For the nine months ended March 31, 2006, management has
recorded an estimate of approximately $220,000 for incentive compensation in
connection with the FY 2006 EIP.

---



FY 2006 Long-Term Executive Incentive Plan

Under the FY 2006 LTEIP, certain designated executives identified as
participants in this plan are entitled to receive cash bonuses if our actual
performance for average annual earnings per share growth and operating margin
over the three-year period beginning  July 1, 2005 and ending June 30, 2008
exceeds certain performance levels (Threshold I, Threshold II, and Threshold
III) as established by the Board of Directors.  The Board also established and
approved the relative weighting that will be used to determine the amount of the
overall incentive compensation awards.  The term of the LTEIP is July 1, 2005
through June 30, 2008.  Performance of SBS above any Threshold but less than the
next Threshold will result in a graduated proportional pay-out; below Threshold
I performance results in no pay-out.  For the nine months ended March 31, 2006,
management has recorded an estimate of approximately $206,000 for incentive
compensation in connection with the FY 2006 LTEIP.

Restricted Stock Award under the FY 2006 LTEIP

Under the FY 2006 LTEIP, restricted stock awards, made out of SBS' 1998
Long-Term Equity Incentive Plan, for 53,462 shares of the Company's common stock
were granted to certain designated executives on July 25, 2005.  The
restrictions on the restricted stock awards lapse on June 30, 2008, regardless
of whether any cash incentive awards are paid under the LTEIP, provided the
designated executive remains an employee of the Company throughout the term of
the LTEIP.  If a change in control of SBS occurs, the shares of restricted stock
will vest on the date of the close of the change in control transaction.  The
fair value for each restricted stock award was $10 based on the closing price of
our common stock on July 25, 2005.  The compensation for the restricted stock
awards will be recognized as an expense over the requisite service period from
July 2005 to June 2008.

Results of Operations(references to fiscal 2006 and fiscal 2005 relate to
interim periods of the fiscal years ending on June 30)

The following table sets forth for the periods
indicated certain operating data as a percentage of sales:

`Three Months Ended      Nine Months Ended
                                                            March 31,               March 31,
                                                      ---------------------   ---------------------
                                                          2006        2005        2006        2005
                                                      ---------   ---------   ---------   --------- 
Sales..............................................      100.0 %     100.0 %     100.0 %     100.0 %
Cost of sales:
  Cost of products sold............................       57.0 %      57.5 %      56.7 %      55.5 %
  Amortization of intangible assets................        0.7 %       1.0 %       0.7 %       1.0 %
                                                      ---------   ---------   ---------   ---------
    Total cost of sales............................       57.6 %      58.5 %      57.5 %      56.5 %
                                                      ---------   ---------   ---------   ---------
Gross profit.......................................       42.4 %      41.5 %      42.5 %      43.5 %

Selling, general and administrative expense........       21.6 %      23.8 %      23.1 %      22.8 %
Research and development expense...................       17.8 %      17.6 %      18.2 %      15.9 %
Amortization of intangible assets..................        0.2 %       0.2 %       0.2 %       0.2 %
                                                      ---------   ---------   ---------   ---------
Operating income (loss)............................        2.8 %      (0.1)%       1.0 %       4.6 %
                                                      ---------   ---------   ---------   ---------
Interest and other income, net.....................        1.2 %       0.7 %       1.2 %       0.5 %
Foreign exchange gains (losses)....................        0.0 %       0.5 %      (0.1)%      (0.2)%
                                                      ---------   ---------   ---------   ---------
                                                           1.2 %       1.2 %       1.1 %       0.3 %
                                                      ---------   ---------   ---------   ---------
Income before income taxes.........................        4.0 %       1.1 %       2.1 %       4.9 %
Income tax expense.................................        1.4 %       0.4 %       0.7 %       1.7 %
                                                      ---------   ---------   ---------   ---------
Net income.........................................        2.6 %       0.7 %       1.4 %       3.2 %
                                                      =========   =========   =========   =========`

Note - certain balances in the above table will not
foot due to rounding.

---



Three and Nine Months Ended March 31, 2006 compared to the Three and Nine
Months Ended March 31, 2005

Sales

Our total sales during the quarter and nine months ended March 31, 2006
compared to the same periods of the prior fiscal year and the preceding quarter
ended December 31, 2005 follows:

`Three Months Ended                       Nine Months Ended
                          ------------------------------------------------   ---------------------------
                                March 31,                                          March 31,
                          -------------------    %       Dec. 31,    %       -------------------    %
Thousands                     2006       2005  change      2005    change        2006       2005 change
                          --------   -------- --------   -------- --------   --------   -------- ------- 
Sales.................. $  39,274  $  37,334      5.2% $  37,284      5.3% $ 110,696  $ 114,464    -3.3%
                          ========   ========            ========            ========   ========`

Sales for the three months ended March 31, 2006 increased compared to the
same period of the prior fiscal year and the preceding quarter due primarily to
increased sales to government and communications end market customers.  During
the three and nine months ended March 31, 2006, currency exchange rates used to
translate our Europe Group financial statements to U.S. dollars negatively
impacted sales by $1.4 million and $2.8 million, respectively, compared to the
same periods of the prior fiscal year.  Sales for the nine months ended March
31, 2006 decreased compared to the same period of the prior fiscal year due to
reduced sales to semiconductor manufacturing equipment customers, partially
offset by increased sales to customers in the government and communications end
markets.

For the quarter ended March 31, 2006, as a percentage of total sales, sales
to one communications customer, Ericsson, represented 19%, sales to one
commercial customer, Applied Materials, represented 6%, and no other customer
represented more than 5% of sales.  For the quarter ended March 31, 2005, as a
percentage of total sales, sales to one communications customer, Ericsson,
represented 17%; sales to one commercial customer, Applied Materials,
represented 8%; and no other customer represented more than 5% of sales.

For the nine months ended March 31, 2006, as a percentage of total sales,
sales to one communications customer, Ericsson, represented 17%, sales to one
commercial customer, Applied Materials, represented 6%; and no other customer
represented more than 5% of sales.  For the nine months ended March 31, 2005, as
a percentage of total sales, sales to one communications customer, Ericsson,
represented 15%; sales to one commercial customer, Applied Materials,
represented 8%; and no other customer represented more than 5% of sales.

Sales by end market for the quarter and nine months ended March 31, 2006
compared to the same periods of the prior fiscal year and the preceding quarter
ended December 31, 2005 as indicated below:

`SALES BY END MARKET
                                 (dollars in thousands)
                             Mar. 31,   % of     Mar. 31,   % of     Dec. 31,   % of
Three months ended:            2006     total      2005     total      2005     total
--------------------------   --------- -------   --------- -------   --------- -------

Government................ $   20,166      51% $   17,400      47%     19,403      52%
Communications............     11,037      28%     10,882      29%      9,977      27%
Commercial................      8,071      21%      9,052      24%      7,904      21%
                             --------- -------   --------- -------   --------- -------
Total..................... $   39,274     100% $   37,334     100%     37,284     100%
                             ========= =======   ========= =======   ========= =======

                             Mar. 31,   % of     Mar. 31,   % of
Nine months ended:             2006     total      2005     total
--------------------------   --------- -------   --------- -------

Government................ $   54,035      49% $   51,504      45%
Communications............     31,731      29%     31,669      28%
Commercial................     24,930      22%     31,291      27%
                             --------- -------   --------- -------
Total..................... $  110,696     100% $  114,464     100%
                             ========= =======   ========= =======`

---



By end market, for the quarter ended March 31, 2006, sales to government
customers increased 15.9%, sales to communications customers increased 1.4%, and
sales to commercial customers decreased 10.8%, all compared to the third quarter
of the prior fiscal year.  On a sequential basis, sales to government
customers increased 3.9%, sales to communications customers increased 10.6%, and
sales to commercial customers increased 2.1%, all compared to the quarter ended
December 31, 2005.  For the nine months ended March 31, 2006, sales to
government customers increased 4.9%, sales to communications customers were
consistent with the prior year, and sales to commercial customers decreased
20.3%, all compared to the same period of the prior fiscal year.  The reduction
in sales to commercial customers in fiscal 2006 compared to fiscal 2005 was due
principally to reduced demand from semiconductor manufacturing equipment
customers.

Gross Profit

Gross profit during the quarter and nine months ended March 31, 2006 compared
to the same periods of the prior fiscal year and the preceding quarter ended
December 31, 2005 follows:

`Three months ended                        Nine Months Ended
                                    -----------------------------------------------------   -------------------------------
                                          March 31,                                               March 31,
                                    ---------------------    Incr/    Dec. 31,     Incr/    ---------------------    Incr/
Thousands                               2006        2005    (decr)      2005      (decr)        2006        2005    (decr)
                                    ---------   ---------   -------   ---------   -------   ---------   ---------   -------
Gross profit..................... $   16,644  $   15,507  $  1,137  $   16,236  $    408  $   47,098  $   49,741  $ (2,643)
                                    =========   =========   =======   =========   =======   =========   =========   =======
Gross profit as a percent of sales:
  Cost of products sold..........       57.0%       57.5%                 55.8%                 56.7%       55.5%
  Intangible asset amortization..        0.7%        1.0%                  0.7%                  0.7%        1.0%
                                    ---------   ---------             ---------             ---------   ---------
    Gross profit.................       42.4%       41.5%                 43.5%                 42.5%       43.5%
                                    =========   =========             =========             =========   =========`

For the three months ended March 31, 2006, gross profit as a percent of sales
improved from levels noted in the prior fiscal year due primarily to the overall
sales mix, which resulted from increased sales to government customers.  For the
nine months ended March 31, 2006, gross profit as a percent of sales declined
from levels noted in the prior fiscal year due primarily to a change in sales
mix resulting from an increased proportion of sales of lower margin products.
Compared to the preceding quarter ended December 31, 2005, a change in our sales
mix negatively impacted gross profit as a percentage of sales due to a higher
proportion of lower margin product sales.

Consistent with our Form 10-K for the year ended June 30, 2005, we have
included the amortization of intangible assets associated with completed
technology and license agreements as a separate component of cost of sales.  The
decrease in fiscal 2006 compared with fiscal 2005 resulted from the completion
of amortization of certain license agreements in June 2005.

Selling, General and Administrative Expense

Selling, general and administrative (SG&A) expense during the quarter and
nine months ended March 31, 2006 compared to the same periods of the prior
fiscal year and the preceding quarter ended December 31, 2005 follows:

`Three months ended                        Nine Months Ended
                                    -----------------------------------------------------   -------------------------------
                                          March 31,                                               March 31,
                                    ---------------------    Incr/    Dec. 31,     Incr/    ---------------------    Incr/
Thousands                               2006        2005    (decr)      2005      (decr)        2006        2005    (decr)
                                    ---------   ---------   -------   ---------   -------   ---------   ---------   -------
SG&A expense..................... $    8,472  $    8,900  $   (428) $    8,413  $     59  $   25,547  $   26,044  $   (497)
                                    =========   =========   =======   =========   =======   =========   =========   =======

As a percent of sales............       21.6%       23.8%                 22.6%                 23.1%       22.8%
                                    =========   =========             =========             =========   =========`

The decrease in SG&A expense for the quarter and nine months ended March
31, 2006 compared to the same periods of the prior fiscal year was primarily the
result of benefits from cost control initiatives we began implementing in fiscal
2006.  These decreases were partially offset by increased incentive compensation
costs discussed previously and stock-based compensation associated with unvested
stock options as a result of our adoption of the fair value method of accounting
for stock options

---

required in SFAS 123R, "Share Based Payment,"
effective July 1, 2005.  The reduction in sales for the nine months in fiscal
2006 compared to fiscal 2005 negatively impacted SG&A expense as a percent
of sales.

Research and Development Expense

Research and development (R&D) expense during the quarter and nine months
ended March 31, 2006 compared to the same periods of the prior fiscal year and
the preceding quarter ended December 31, 2005 follows:

`Three months ended                        Nine Months Ended
                                    -----------------------------------------------------   -------------------------------
                                          March 31,                                               March 31,
                                    ---------------------    Incr/    Dec. 31,     Incr/    ---------------------    Incr/
Thousands                               2006        2005    (decr)      2005      (decr)        2006        2005    (decr)
                                    ---------   ---------   -------   ---------   -------   ---------   ---------   -------
R&D expense...................... $    6,975  $    6,556  $    419  $    6,530  $    445  $   20,197  $   18,163  $  2,034
                                    =========   =========   =======   =========   =======   =========   =========   =======

As a percent of sales............       17.8%       17.6%                 17.5%                 18.2%       15.9%
                                    =========   =========             =========             =========   =========`

Increasing our intellectual property continues to be a key element of our
growth strategy.  During fiscal 2006, we introduced 15 new products and 3 new
product lines.

The increase in R&D expense for the three and nine months of fiscal 2006
compared to the same periods of the prior fiscal year was primarily the result
of our fiscal 2005 mid-year investment in additional engineering resources to
serve the government and international markets, the timing of outside
development costs associated with our product development efforts, and increased
incentive compensation costs associated with the incentive compensation plans
approved by the Board of Directors on July 25, 2005.  On a sequential basis,
R&D expense increased from the preceding quarter as a result of our product
development efforts.  The reduction in sales for the nine months in fiscal 2006
compared to fiscal 2005 negatively impacted R&D expense as a percent of
sales.

Interest and Other Income, Net

Net interest and other income of $482,000 and $1.3 million for the three and
nine months ended March 31, 2006, respectively, represent an increase from
amounts received during the comparable periods of fiscal 2005 due primarily to
improvements in interest rates earned for cash balances and increased cash
balances.

Foreign Exchange Gains (Losses)

Foreign exchange gains (losses), which represent primarily realized and
unrealized losses on transactions denominated in non-functional currencies,
decreased in the nine months ended March 31, 2006 from prior year levels
primarily as a result of reduced payables in non-functional currencies and
changes in the Euro to U.S. dollar exchange rates.

Income Tax Expense

We record income tax expense based on our estimated worldwide effective tax
rates for the respective fiscal years.  For fiscal 2006 and 2005, our estimated
worldwide effective tax rate was approximately 35.0%.  Our estimated worldwide
effective income tax rate incorporates a projected mix of pre-tax income from
domestic and foreign sources, together with benefits from certain income tax
planning strategies, including benefits from foreign sales and research and
experimentation tax credits.  We continue to evaluate the potential impact of
the foreign dividend repatriation provisions of the American Jobs Creation Act
of 2004 on our estimated worldwide effective tax rate.

In assessing the realizability of our deferred tax assets, management
considers projected future sources of taxable income together with tax planning
strategies. A valuation allowance has been established that applies to certain
U.S. State and foreign operating loss and tax credit carryforwards that, in the
opinion of management, may expire unused due to uncertainty regarding future
taxable income.  Based on SBS'
historical taxable transactions, the timing of the reversal of existing
temporary differences, and the evaluation of tax planning strategies, management
believes it is more likely than not that SBS'
future taxable income will be sufficient to realize
the benefit of the remaining deferred tax assets existing at March 31, 2006.

We generally do not record deferred income taxes on the undistributed
earnings of our foreign subsidiaries in accordance with the indefinite reversal
criterion in APB Opinion No. 23, "Accounting for Income Taxes -
Special Areas," because we currently do not expect those unremitted
earnings to reverse and become taxable in the foreseeable future.  Upon
distribution of these

---

earnings, which amounted to approximately $34.6 million at
June 30, 2005, we may be subject to U.S. income taxes and foreign withholding
taxes.  It is not practical, however, to estimate the amount of taxes that may
be payable on the eventual remittance of these earnings.

Earnings Per Share

For the three and nine months ended March 31, 2006, net income per common
share and net income per common share - assuming dilution were $0.06 and $0.10,
respectively.  This compares to net income per common share and net income per
common share - assuming dilution of $0.02 and $0.23 for the same periods of the
prior fiscal year.

Review of Business Segments

We are engaged in the design,
research, development, integration and production of embedded computer products
and we operate worldwide through two operating segments: the Americas Group and
the Europe Group.  Both the Americas Group and the Europe Group offer
our complete portfolio of embedded computer products to customers in the
government, commercial and communications end markets.  Each segment has
management who reports directly to our Chief Executive Officer and its own sales
and distribution channels.  The Americas Group consists of our operations based
in the United States, Canada, and Shenzhen, China.  This includes the sales,
engineering and test activities in Albuquerque, New Mexico; Mansfield,
Massachusetts; Newark, California; Raleigh, North Carolina; St. Paul, Minnesota;
and Waterloo, Ontario, Canada; the manufacturing and assembly operations located
in St. Paul, Minnesota and Albuquerque, New Mexico; and the sales and technical
support activities based in Shenzhen, China.  The Europe Group consists of our
operations based in Germany which include the sales, engineering, test,
assembly, and manufacturing activities located in Augsburg and Mindelheim,
Germany.

The following is a discussion of sales to external customers and segment
profit (loss) for each reportable segment.  We measure the results of operations
for segments (Segment Profit (Loss)) based on income before income taxes
and before:

- the allocation of corporate overhead expenses other than marketing
costs;
- substantially all amortization expense associated with acquisitions; and
- interest income earned on U.S. operations cash balances.

Americas Group

`Three Months Ended                                 Nine Months Ended
                                  -------------------------------------------------   -----------------------------
                                        March 31,                                           March 31,
                                  ---------------------    %      Dec. 31,     %      ---------------------    %
Thousands                             2006        2005  change      2005    change        2006        2005  change
                                  ---------   --------- -------   --------- -------   ---------   --------- -------
Sales to External Customers.... $   24,083  $   22,870     5.3% $   21,263    13.3% $   67,315  $   73,343    -8.2%
                                  =========   =========           =========           =========   =========

Segment Profit................. $    2,580  $      183  1309.8% $    1,388    85.9% $    4,859  $    5,613   -13.4%
                                  =========   =========           =========           =========   =========
Segment Profit as % of Sales...       10.7%        0.8%                6.5%                7.2%        7.7%
                                  =========   =========           =========           =========   =========`

Sales to External Customers.   For the three months ended March 31,
2006, sales to external customers increased compared to the same period of
fiscal 2005 due primarily to increased sales to customers in the government end
market.  For the nine months ended March 31, 2006, sales to external customers
declined compared to the same period of the prior fiscal year due primarily to
reduced sales to semiconductor equipment manufacturing customers, partially
offset by increased sales to customers in the government end market.  During the
three and nine months ended March 31, 2006, sales to one commercial customer,
Applied Materials, represented $2.3 million and $6.3 million, respectively,
compared to $2.8 million and $11.8 million in the same periods ended March 31,
2005.

Segment Profit. For the three months ended March 31, 2006, segment
profit increased from prior year levels primarily as a result of improved gross
profit and reduced SG&A expenses due to certain cost control initiatives we
began to implement in fiscal 2006, partially offset by increased R&D
expenses.   For the nine month period ended March 31, 2006, segment profit
decreased from fiscal 2005 levels primarily as a result of decreased gross
profit together with increased R&D expenses, partially offset by reduced
SG&A expenses as a result of certain cost control initiatives we began to
implement in fiscal 2006.   Changes in gross profit as a percent of sales are
primarily driven by changes in our overall sales mix.  The increased R&D

---

expenses were due primarily to our mid-year decision in fiscal 2005 to invest in
our infrastructure to pursue opportunities in the government systems market, the
timing of outside development costs associated with our product development
efforts, and increased incentive compensation as discussed previously.

Europe Group

`Three Months Ended                                 Nine Months Ended
                                  -------------------------------------------------   -----------------------------
                                        March 31,                                           March 31,
                                  ---------------------    %      Dec. 31,     %      ---------------------    %
Thousands                             2006        2005  change      2005    change        2006        2005  change
                                  ---------   --------- -------   --------- -------   ---------   --------- -------
Sales to External Customers.... $   15,191  $   14,464     5.0% $   16,021    -5.2% $   43,381  $   41,121     5.5%
                                  =========   =========           =========           =========   =========

Segment Profit................. $    2,359  $    3,043   -22.5% $    3,491   -32.4% $    7,629  $    9,309   -18.0%
                                  =========   =========           =========           =========   =========
Segment Profit as % of Sales...       15.5%       21.0%               21.8%               17.6%       22.6%
                                  =========   =========           =========           =========   =========`

Sales to External Customers.  For the three and nine months ended
March 31, 2006, sales to external customers increased approximately $0.7 million
and $2.3 million, respectively, both compared to the same periods of the prior
fiscal year.  During the three and nine months ended March 31, 2006, currency
exchange rates used to translate the Group's financial statements to U.S.
dollars declined by 9.7% and 6.8%, respectively, which negatively impacted sales
by $1.4 million and $2.8 million, respectively, compared to the same periods of
the prior fiscal year.  During the three and nine month periods ended March 31,
2006, sales to one communications customer, Ericsson, represented $7.4 million
and $19.1 million, respectively, compared to $6.5 million and $17.4 million in
the same periods of the prior fiscal year.

Segment Profit. For the three and nine months ended March 31, 2006,
segment profit decreased approximately $0.7 million and $1.7 million,
respectively, both compared to the comparable periods of the prior fiscal year.
The decrease was due primarily to reduced gross profit as a result of a higher
mix of lower margin production orders and increases in R&D expenses
commensurate with the growth in the business, partially offset by the increase
in sales and decreased SG&A expenses as a result of certain cost control
initiatives we began to implement in fiscal 2006.

Liquidity, Capital Resources and Financial Condition

Our objective is to maintain adequate financial resources and
liquidity to finance our operations.  We use a combination of proceeds from the
sale or issuance of equity securities and internally generated funds to finance
our working capital requirements, capital expenditures, and operations.

Our cash balance of $53.2 million at March 31, 2006 represented a decrease of
$2.0 million during the nine months ended March 31, 2006.  This decrease was due
primarily to the timing of cash payments and collections during the period.  For
the nine months ended March 31, 2006 and 2005, net cash flows from operating
activities and proceeds from the exercise of employee stock options were the
principal sources of funding, and cash was used for a mix of activities
including working capital needs and capital expenditures.  We anticipate that
our cash sources and uses will continue in this manner during the remainder of
the fiscal year ending June 30, 2006; however, future cash inflows from employee
stock option exercises are generally dependent upon the amount of excess, if
any, between the current market price of our common stock and the price the
employee must pay to exercise the option and are therefore difficult to predict
with certainty.

---



Cash Flows

Changes to our cash balance during the nine months ended March 31,
2006, and 2005 follows:

Comparison of Condensed
Consolidated Statements of Cash Flows

`Nine Months Ended
                                                     March 31,
                                              -----------------------
                                                 2006         2005
                                              ----------   ----------
Cash Flow Provided by (Used in)                     Thousands 
   Operating activities....................  $   (1,138)  $    7,794
   Investing activities....................      (1,611)      (2,623)
   Financing activities....................         706        1,345
   Net effect on cash from:
      Exchange rate changes................          45          555
                                              ==========   ==========`

Operating Activities

Cash flows from operating activities during the nine months ended March 31,
2006, were principally impacted by the timing of payments for working capital
needs and cash collections from customers during the period.  Operating cash
flows were provided by net income and the impact of certain non-cash and non-
operating activities, including depreciation and amortization expenses totaling
approximately $3.7 million and stock-based compensation costs of approximately
$610,000, of which approximately $286,000 was the result of our adoption of SFAS
123R on July 1, 2005.

The underlying drivers of the changes in working capital during the first
nine months of fiscal 2006 were as follows:

- The increase in accounts receivable used operating cash of $2.0 million,
before foreign currency translation adjustments of approximately $40,000, due
principally to the timing of shipments and cash collections during the period.
- The increase in inventory used cash of $4.2 million, before foreign currency
translation adjustments of approximately $32,000, due primarily to inventory on
hand for products that are scheduled to begin production.
- The decrease in total liabilities used cash from operations of $0.5 million,
before foreign currency translation adjustments of $69,000, due primarily to the
timing of cash payments for working capital needs, partially offset by incentive
compensation accruals and payments during the period in connection with the
Company's pay-for-performance incentive plans implemented in fiscal
2006.

Investing Activities

Our principal recurring investing activity is the funding of capital
expenditures necessary to support the growth of our business and to enhance the
productivity of our operations.  During the nine month period ended March 31,
2006, purchases of property and equipment were $1.6 million.

Financing Activities

Our principal source of cash inflows from financing activities is
proceeds from the issuance of common stock associated with the exercise of
employee stock options.  During the nine month period ended March 31, 2006,
proceeds from the issuance of common stock associated with the exercise of
employee stock options were $706,000.

Exchange Rates

Changes in foreign currency exchange rates during the nine months ended
March 31, 2006 favorably impacted our cash balances by approximately $45,000.
Due to our international operations, where transactions are recorded in
functional currencies other than the U.S. dollar, the effects of changes in
foreign currency exchange rates on existing cash balances during any given
period result in amounts on the consolidated statements of cash flows that may
not reflect the changes in the corresponding accounts on the consolidated
balance sheets.

---



Cash Requirements

On March 30, 2005, we entered into a revolving line of credit agreement
(Credit Agreement) with Wells Fargo Bank National Association.  The credit
agreement provides for borrowings for working capital and general corporate
purposes of up to $20 million.  Effective on March 30, 2006, the Credit
Agreement was amended (Second Amendment to Credit Agreement) to extend the term
of the Credit Agreement and the revolving note for a period of one year and any
outstanding borrowings are due and payable in full on March 28, 2007.  The
Credit Agreement is secured by a first priority lien on substantially all assets
of SBS.  Interest on borrowings is set forth in each promissory note executed
under the terms of the Credit Agreement and is either payable on a variable
basis at the Wells Fargo Bank prime rate or payable for a fixed rate term of
either one, two or three months at a rate of LIBOR plus 1.75%.

The terms of the Credit Agreement, as amended, require SBS to comply with
certain financial and other covenants, including but not limited to:

- an Adjusted Tangible Net Worth balance of not less than $109,129,000, plus
50% of quarterly net income beginning with the quarter ended March 31, 2005,
excluding any loss quarters, plus all proceeds from equity offerings;

(Adjusted Tangible Net Worth defined as total stockholders' equity
minus the aggregate of any intangible assets; any treasury stock; any
receivables from stockholders, employees and/or affiliates; and foreign currency
translation adjustments)

- a Leverage Ratio of not greater than 0.50 to 1;

(Leverage Ratio defined as total liabilities divided by Tangible Net
Worth.  Tangible Net Worth defined as total stockholders' equity minus the
aggregate of any intangible assets; any treasury stock; and any receivables from
stockholders, employees and/or affiliates)

- a Quick Ratio of not less than 1.75 to 1;

(Quick Ratio calculated as total current assets excluding inventory,
divided by total current liabilities)

- an average Accounts Receivable Days Outstanding balance of no more than 90
days; and

(Accounts Receivable Days Outstanding calculated as average net trade
receivables divided by net sales for the period times the number of days in
reporting period)

- a requirement to maintain profitable operations defined as no more than two
(2) consecutive loss quarters or a net loss for the total fiscal year.

Under the terms of the Credit Agreement, we are required to maintain our
primary operating accounts with Wells Fargo Bank or maintain a balance of not
less than $20 million on deposit with the bank.  As of March 31, 2006, the
Company maintains most of its primary operating accounts with Wells Fargo Bank
and our balance on deposit was in excess of $20 million.

As of the date of this report, we have no borrowings outstanding under the
Credit Agreement and we were in compliance with all financial covenants required
under the terms of the amended Credit Agreement as of March 31, 2006.

We believe the funds available under the Credit Agreement and our internally
generated cash flows will provide us with sufficient capital resources and
liquidity to manage our operations, meet our contractual obligations, and fund
capital expenditures, excluding acquisitions, for at least the next twelve
months.  Because long-term cash flow cannot be predicted with certainty, it is
possible that we could require additional external financing in the future and
that the financing may not be available on terms acceptable to us or at all.

Capital Resources

As of the date of this report, we do not have any material capital
expenditure commitments.

Contractual Obligations

SBS is committed under non-cancelable operating leases for buildings and
equipment that expire at various dates through fiscal 2015.  There was no
material change in our contractual obligations during the nine months ended
March 31, 2006.

---



Off-Balance Sheet Arrangements

As of March 31, 2006, we had no transactions that would be considered
off-balance sheet arrangements in accordance with the definition under SEC
rules.

Inflation

For the three and nine month periods ended March 31, 2006 and 2005, we
experienced no significant impact from inflation.

Business Outlook

Fiscal year 2006 marks our fourteenth year as a public company.  With the
proposed merger of SBS and GE Fanuc, which we jointly announced on March 20,
2006, this may be our last report as an independent public company, and we would
like to thank every SBS shareholder for their support over these many years in
helping us build this great company.  Consummation of the merger is subject to a
number of conditions, including the approval by the holders of at least a
majority of the outstanding shares of the Company's common stock, the receipt of
all regulatory approvals, including the termination or expiration of the waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and certain other customary conditions.  The Company currently
anticipates having all required shareholder, regulatory and other approvals
necessary to close the merger late in the second calendar quarter or during the
third calendar quarter of 2006.

As a result of the anticipated merger with GE Fanuc, management will no
longer be providing guidance on future results of the Company.  Unless a notice
stating otherwise is published or filed with the Securities and Exchange
Commission on Form 8-K, the public should no longer rely on any previously
issued guidance as representing our current expectations on matters covered.

Recently Issued Accounting Standards

In May 2005, the FASB, as part of an effort to conform to
international accounting standards, issued SFAS No. 154, Accounting
Changes and Error Corrections, (SFAS 154).  SFAS 154 is effective for
accounting changes and corrections of errors made in fiscal years beginning
after Dec. 15, 2005 or beginning on July 1, 2006.  SFAS 154 requires that
all voluntary changes in accounting principles be retrospectively applied to
prior financial statements as if that principle had always been used, unless it
is impracticable to do so. When it is impracticable to calculate the effects on
all prior periods, SFAS No. 154 requires that the new principle be applied
to the earliest period practicable. SFAS 154 also redefines
"restatement" as the revising of previously issued financial
statements to reflect the correction of an error. The adoption of SFAS
No. 154 is not anticipated to have a material effect on our financial
position or results of operations.

Item 3- Quantitative and Qualitative
Disclosures about Market Risk

Our principal investment is cash invested in either money market accounts
or in overnight repurchase agreements.  Due to the nature of these investments,
we believe that the market risk related to these investments is minimal.  As a
result of our German and Canadian operating and financing activities, we are
exposed to market risk from changes in foreign currency exchange rates.  At
present we do not utilize any derivative instruments to manage this risk.

Currency translation.  The results of operations of our foreign
subsidiaries are translated into U.S. dollars at the average exchange rates for
each period concerned. The balance sheets of foreign subsidiaries are translated
into U.S. dollars at the closing exchange rates. Any adjustments resulting from
the translation are recorded as translation adjustments in other comprehensive
income.  Foreign currency exchange rate exposure is most significant with
respect to the euro.  For the three and nine months ended March 31, 2006, net
sales were negatively impacted by declines in foreign currency exchange rates of
9.7% and 6.8%, primarily the euro, respectively, compared to the same periods of
the prior fiscal year.

Currency transaction exposure.  Currency transaction exposure
arises where a business or company makes actual sales and purchases in a
currency other than its own functional currency. We generally source raw
materials and sell our products within our local markets in their functional
currencies and therefore have limited currency transaction exposure.

---



Item 4- Controls and Procedures

Quarterly Controls Evaluation and Related CEO and CFO Certifications

As of the end of the period covered by this Quarterly Report on Form 10-Q,
we evaluated the effectiveness of the design and operation of
"disclosure controls and procedures" (Disclosure Controls).  The
controls evaluation was done under the supervision and with the participation of
management, including our Chief Executive Officer (CEO) and Chief Financial
Officer (CFO).

Attached as Exhibits to this Quarterly Report on Form 10-Q are certifications
of the CEO (Exhibit 31.1) and the CFO (Exhibit 31.2), which are required in
accordance with Rule 13a-14 of the Securities Exchange Act of 1934 (the Exchange
Act). This Controls and Procedures section includes the information concerning
the controls evaluation referred to in the certifications and it should be read
in conjunction with the certifications for a more complete understanding of the
topics presented.

Disclosure Controls and Internal Controls

Disclosure Controls are procedures designed to ensure that information
required to be disclosed in our reports filed under the Exchange Act, such as
this Quarterly Report, is recorded, processed, summarized and reported within
the time periods specified in the U.S. Securities and Exchange Commission's
rules and forms. Disclosure Controls are also designed to ensure that the
information is accumulated and communicated to our management, including the CEO
and CFO, as appropriate to allow timely decisions regarding required disclosure.

Internal control over financial reporting (Internal Controls) are procedures
which are designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with accounting principles generally accepted in the
United States of America and includes those policies and procedures that: (1)
pertain to the maintenance of records that in reasonable detail accurately and
fairly reflect the transactions and dispositions of the assets of SBS; (2)
provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of SBS are being made
only in accordance with authorizations of management and directors of SBS; and
(3) provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use or disposition of SBS' assets that could have a
material effect on the financial statements.  To the extent that components
of our Internal Controls are included in our Disclosure Controls, they are
included in the scope of our quarterly controls evaluation.

Limitations on the Effectiveness of Controls

Our management, including the CEO and CFO, does not expect that our
Disclosure Controls or Internal Controls will prevent all error and all fraud. A
control system, no matter how well designed and operated, can provide only
reasonable, not absolute, assurance that the control system's objectives will be
met.  Further, the design of a control system must reflect the fact that there
are resource constraints, and the benefits of controls must be considered
relative to their costs. Because of the inherent limitations in all control
systems, no evaluation of controls can provide absolute assurance that all
control issues and instances of fraud, if any, within the company have been
detected. These inherent limitations include the realities that judgments in
decision-making can be faulty, and breakdowns can occur because of simple error
or mistake. Controls can also be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the
controls. The design of any system of controls is based in part upon certain
assumptions about the likelihood of future events, and we cannot assure that any
design will succeed in achieving its stated goals under all potential future
conditions. Over time, controls may become inadequate because of changes in
conditions or deterioration in the degree of compliance with policies or
procedures. Because of the inherent limitations in a cost-effective control
system, misstatements due to error or fraud may occur and not be detected.

Conclusions

Based on our controls evaluation (with the participation of our CEO and
CFO), as of the end of the period covered by this report, our CEO and CFO have
concluded that our disclosure controls and procedures (as defined in Rules 13a-
15(e) and 15d-15(e) under the Exchange Act) are effective to provide reasonable
assurance that information required to be disclosed by us in reports that we
file or submit under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in Securities and Exchange Commission
rules and forms.

There were no changes to our internal control over financial reporting during
the quarter ended March 31, 2006 that materially affected, or are reasonably
likely to materially affect, our internal control over financial reporting.

---



PART II - OTHER INFORMATION

Item 1 - Legal Proceedings

We are subject to various claims that arise in the ordinary course of our
business. In our opinion, the amount of ultimate liability with respect to these
actions will not materially affect our financial position, results of
operations, or liquidity. We are not a party to, and none of our property is
subject to, any material pending legal proceedings.  We know of no material
proceedings contemplated by governmental authorities.

Item 5 - Other Information

On April 20, 2006, SBS Technologies, Inc. issued a press release
reporting its results for the third quarter of fiscal year 2006 ended March 31,
2006.  A copy of the Registrant's press release containing this information is
furnished as Exhibit 99.1 to this Report on Form 10-Q.   The information in Item
5 and the Exhibit attached hereto is being furnished and shall not be deemed
"filed" for purposes of Section 18 of the Securities Exchange Act of
1934 (the "Exchange Act") or otherwise subject to the liabilities of
that section, nor shall it be deemed incorporated by reference in any filing
under the Securities Act of 1933 or the Exchange Act, regardless of any general
incorporation language in such filing.

Item 6 - Exhibits



02.1 	(1)	Agreement and Plan of Merger dated as of March 19, 2006 among
GE Fanuc Embedded Systems, Inc., GME, Inc., and SBS Technologies, Inc.

03.i 	(1)	Restated Articles of Incorporation.

03.ii	(1)	Third Restated and Amended Bylaws.

04.a	(1)	Article VI of the Restated Articles of Incorporation, as
included in the Restated Articles of Incorporation of SBS Technologies,
Inc.

04.b	(1)	Articles I and II of the Third Restated and Amended Bylaws of
SBS Technologies, Inc.

04.c	(1)	Form of certificate evidencing Common Stock.

04.1	(1)	Rights Agreement dated September 15, 1997 between SBS
Technologies, Inc. and First Security Bank (now Wells Fargo), National
Association, as Rights Agent, which includes the form of Right Certificate as
Exhibit A and the Summary of Rights to Purchase Common Stock as Exhibit B.2 and
Agreement to Serve as Rights Agent; on January 21, 1998, pursuant to Section 21
of the Shareholder Rights Agreement dated September 15, 1997, we appointed
Norwest Bank Minnesota N.A. (now Wells Fargo) as Successor Rights Agent.

04.2	(1)	Amendment dated March 19, 2006 to Rights Agreement

10.be	(1)	2000 Long-Term Equity Incentive Plan

10.cs	(1)	Amendment #3 to Lease between Oakview Eagan Investors, LLC (a
Delaware Limited Liability Company), as successor in interest to Lutheran
Brotherhood, (a Minnesota Corporation), and SBS Technologies, Inc., Commercial
Group, formerly known as Bit 3 Computer Corporation, a wholly-owned subsidiary
of SBS Technologies, Inc., dated July 12, 2005, together with the original lease
agreement dated September 5, 1997 (the "original lease"), as amended
by amendment #1 dated December 23, 1997, and amendment #2 dated May 22, 2002.

10.ct	(1)	SBS Technologies, Inc. FY 2006 Employee Bonus Plan

10.cu	(1)	SBS Technologies, Inc. FY 2006 Executive Incentive Plan

10.cv	(1)	SBS Technologies, Inc. FY 2006 Long-term Executive Incentive
Plan

10.cw	(1)	Employment agreement by and between SBS Technologies, Inc.,
and Bruce E. Castle, effective July 29, 2003, as amended on January 18, 2006.

10.cx	(1)	Amended and Restated 1993 Director and Officer Stock Option
Plan

10.cy	(1)	Amended and Restated 1996 Employee Incentive Stock Option
Plan

---



10.cz	(1)	 Amended and Restated 1997 Employee Incentive Stock Option
Plan

10.da	(1)	Amendment dated March 19, 2006 to Employment Agreement of
Bruce E. Castle

10.db	(1)	Amendment dated March 19, 2006 to Employment Agreement of
James E. Dixon, Jr.

10.dc	(1)	Amendment dated March 19, 2006 to Employment Agreement of
David H. Greig

10.dd	(1)	Second Amendment to Credit Agreement between SBS
Technologies, Inc. and Wells Fargo Bank National Association effective March 30,
2006.

10.de  (1)	Revolving Line of Credit Note with Wells Fargo Bank National
Association, effective March 30, 2006.

14	(1)	Code of Ethics.

31.1	(1)	Certification of the Company's Chief Executive Officer under
Section 302 of the Sarbanes-Oxley Act of 2002.

31.2	(1)  	Certification of the Company's Chief Financial Officer under
Section 302 of the Sarbanes-Oxley Act of 2002.

32.1	(1)	Certification of the Chief Executive Officer, Pursuant to 18
U.S.C. Section 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.

32.2	(1)  	Certification of the Chief Financial Officer, Pursuant to 18
U.S.C. Section 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.

99.1	(1)	Press release dated April 20, 2006.

(1)   See Exhibit Index

---



SIGNATURES

Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.



SBS TECHNOLOGIES, INC.
	(Registrant)

By: /s/ Clarence W. Peckham
	Clarence W. Peckham
	Chief Executive Officer

By: /s/ James E. Dixon Jr.	James E. Dixon Jr.Executive Vice President and 
Chief Financial Officer



Date: April 24, 2006



---





|INDEX TO EXHIBITS
|-----------------
|                 
|Exhibit Number   

|2.1   | Agreement and Plan of Merger dated as of March 19, 2006 among GE
Fanuc Embedded Systems, Inc., GME, Inc., and SBS Technologies, Inc.                                                                                                                                                                                                                                                                                                                                                                                                  | 8-K  | 001-10981 | 2.1   | 3-23-2006  |  
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---- | --------- | ----- | ---------- | -
|3.i   | Restated Articles of Incorporation dated November 10,
2000                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 10-Q | 001-10981 | 3.i   | 9-30-2005  |  
|3.ii  | Third Restated and Amended By-laws dated January 31,
2006                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 8-K  | 001-10981 | 3.ii  | 2-02-2006  |  
|4.a   | Article VI of the Articles of Incorporation, as amended, as
included in the Articles of Incorporation of SBS Technologies, Inc.                                                                                                                                                                                                                                                                                                                                                                                                       | 10-Q | 001-10981 | 4.a   | 9-30-2005  |  
|4.b   | Articles I and II of the Third Restated and Amended By-laws of
SBS Technologies, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 8-K  | 001-10981 | 3.ii  | 2-02-2006  |  
|4.c   | Form of certificate evidencing Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |      |           |       |            | X
|4.1   | Rights Agreement dated as of September 15, 1997 between SBS
Technologies, Inc. and First Security Bank (now Wells Fargo), National
Association, as Rights Agent, which includes the form of Right Certificate as
Exhibit A, and the Summary of Rights to Purchase Common Stock as Exhibit B.2.
Agreement to Serve as Rights Agent.  On January 21, 1998, pursuant to Section 21
of the Rights Agreement, SBS appointed Norwest Bank Minnesota, N.A. (now Wells
Fargo) as Successor Rights Agent.                                      | 10-K | 001-10981 | 4.1   | 6-30-2002  |  
|4.2   | Amendment dated March 19, 2006 to Rights Agreement                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 8-K  | 001-10981 | 4.2   | 3-23-2006  |  
|10.be | 2000 Long-Term Equity Incentive Plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 10-Q | 001-10981 | 4.c   | 12-31-2005 |  
|10.cs | Amendment #3 to Lease between Oakview Eagan Investors, LLC (a
Delaware Limited Liability Company), as successor in interest to Lutheran
Brotherhood, (a Minnesota Corporation), and SBS Technologies, Inc., Commercial
Group, formerly known as Bit 3 Computer Corporation, a wholly-owned subsidiary
of SBS Technologies, Inc., dated July 12, 2005, together with the original lease
agreement dated September 5, 1997 (the "original lease"), as amended
by amendment #1 dated Dec. 23, 1997, and amendment #2 dated May 22,
2002. | 8-K  | 001-10981 | 10.cs | 7-13-2005  |  
|10.ct | SBS Technologies FY 2006 Employee Bonus Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 8-K  | 001-10981 | 10.ct | 7-28-2005  |  
|10.cu | SBS Technologies FY 2006 Executive Incentive Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 8-K  | 001-10981 | 10.cu | 7-28-2005  |  
|10.cv | SBS Technologies FY 2006 Long-Term Executive Incentive
Plan.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 8-K  | 001-10981 | 10.cv | 7-28-2005  |  

---





|INDEX TO EXHIBITS
|-----------------
|                 
|Exhibit Number   

|10.cw  | Employment agreement by and between SBS Technologies, Inc., and
Bruce E. Castle, effective July 29, 2003, as amended on January 18,
2006. | 8-K | 001-10981 | 10.cw | 1-23-2006  |  
|------ | ----------------------------------------------------------------------------------------------------------------------------------------- | --- | --------- | ----- | ---------- | -
|10.cx  | Amended and Restated 1993 Director and Officer Stock Option
Plan                                                                          | 8-K | 001-10981 | 10.cx | 3-23-2006  |  
|10.cy  | Amended and Restated 1996 Employee Incentive Stock Option
Plan                                                                            | 8-K | 001-10981 | 10.cy | 3-23-2006  |  
|10.cz  | Amended and Restated 1997 Employee Incentive Stock Option
Plan                                                                            | 8-K | 001-10981 | 10.cz | 3-23-2006  |  
|10.da  | Amendment dated March 19, 2006 to Employment Agreement of Bruce
E. Castle                                                                 | 8-K | 001-10981 | 10.da | 3-23-2006  |  
|10.db  | Amendment dated March 19, 2006 to Employment Agreement of James
E. Dixon, Jr.                                                             | 8-K | 001-10981 | 10.db | 3-23-2006  |  
|10.dc  | Amendment dated March 19, 2006 to Employment Agreement of David
H. Greig                                                                  | 8-K | 001-10981 | 10.dc | 3-23-2006  |  
|10.dd  | Second Amendment to Credit Agreement between SBS Technologies,
Inc. and Wells Fargo Bank National Association effective March 30,
2006.   | 8-K | 001-10981 | 10.dd | 3-30-2006  |  
|10.de  | Revolving Line of Credit Note with Wells Fargo Bank National
Association, effective March 30, 2006.                                       | 8-K | 001-10981 | 10.de | 3-30-2006  |  
|14     | Code of Ethics.                                                                                                                           | 8-K | 001-10981 | 14    | 11-21-2003 |  
|31.1   | Section 302 certification of Clarence W. Peckham, Chief
Executive Officer                                                                 |     |           |       |            | X
|31.2   | Section 302 certification of James E. Dixon Jr., Chief Financial
Officer                                                                  |     |           |       |            | X
|32.1   | Section 906 certification of Clarence W. Peckham, Chief
Executive Officer                                                                 |     |           |       |            | X
|32.2   | Section 906 certification of James E. Dixon Jr., Chief Financial
Officer                                                                  |     |           |       |            | X
|99.1 * | Press release dated April 20, 2006                                                                                                        |     |           |       |            | X
|       | * - Provided in PDF format as a courtesy                                                                                                  |     |           |       |            |