SECURITIES AND EXCHANGE
COMMISSIONWASHINGTON, DC 20549 FORM 10‐QSB QUARTERLY REPORT UNDER
SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934 For quarter ended November 30,
2005 Commission File Number 0‐3498  TAYLOR DEVICES,
      INC.(EXACT NAME OF
      REGISTRANT AS SPECIFIED IN ITS
CHARTER)
  NEW
      YORK
    
    16‐0797789(State or other Jurisdiction of
      incorporation or organization)
    
    (I.R.S. Employer
      Identification Number)
  90 TAYLOR DRIVE,
      NORTH TONAWANDA, NEW YORK 14120-0748Address of principal
      executive offices
  Registrant's
      Telephone Number - 716‐694‐0800
  Check whether the registrant (1) has
filed all reports required to be filed by Section 13 or 15(d) of the Exchange
Act during the last 12 months and (2) has been subject to the filing
requirements for the past 90 days. Yes
    X
    
    No Indicate by checkmark whether the
registrant is a shell company (as defined in Rule 12(b)-2 of the Exchange
Act. Yes
    
    
    No
    X State the number of shares outstanding of
each of the Issuer's classes of common equity, as of the latest practicable
date: CLASS
    
    Outstanding at
      January 13, 2006Common Stock(2‐1/2
      cents par value)
    
    3,103,142
     TAYLOR DEVICES, INC.  Index to Form
10-QSB PART I
    FINANCIAL
      INFORMATION                                                                                                                   
      PAGE NO.Item
    1.
    Financial
      StatementsCondensed Consolidated
      Balance Sheets November 30, 2005 and May 31, 2005
    3Condensed Consolidated
      Statements of Income for the three and six months ended November 30, 2005
      and November 30, 2004
    4Condensed Consolidated
      Statements of Cash Flows for the six months ended November 30, 2005 and
      November 30, 2004
    5Notes to Condensed
      Consolidated Financial Statements
    6Item 2.
    Management's Discussion
      and Analysis or Plan of Operation
    7Item 3.
    Controls and
      Procedures
    
    12PART II
    OTHER
      INFORMATIONItem 1.
    Legal
      Proceedings
    13Item 2.
    Unregistered Sales of
      Equity Securities and Use of Proceeds
    13Item 3.
    Defaults upon Senior
      Securities
    13Item 4.
    Submission of Matters
      to a Vote of Security Holders
    14Item 5.
    Other
      Information
    14Item 6.
    Exhibits
    14REPORT OF INDEPENDENT
      REGISTERED PUBLIC ACCOUNTING FIRM
    15SIGNATURES
    
    16
   TAYLOR DEVICES, INC.
      AND SUBSIDIARYCondensed
      Consolidated Balance Sheets
    (Unaudited)November
      30,2005
    May
      31,2005AssetsCurrent
      assets:Cash and cash
    equivalents
    $        
      52,710
    $        
    63,397Accounts receivable,
    net
    1,763,399
    2,718,902Inventory
    4,468,818
    4,771,086Costs and estimated earnings in
      excess of billings
    1,821,024
    1,657,170Other current assets
    903,274
    920,638Total current assets
    9,009,225
    10,131,193Maintenance and other inventory,
      net
    797,238
    661,500Property and equipment,
      net
    3,355,168
    3,477,672Investment in affiliate, at
      equity
    445,425
    451,877Intangible and other
      assets
    167,118
    168,376$ 
      13,774,174
    $ 
      14,890,618Liabilities and
      Stockholders' EquityCurrent
      liabilities:Short-term borrowings and current
      portion of long-term debt
    $       237,003
    $  
      1,621,119Payables - trade
    900,293
    770,330Accrued commissions
    636,712
    576,550Billings in excess of costs and
      estimated earnings
    268,539
    288,003Other current
    liabilities
    544,314
    386,586Total current liabilities
    2,586,861
    3,642,588Long-term liabilities
    863,839
    998,719Payables - affiliate
    418,344
    589,976Minority stockholder's
      interest
    465,593
    450,991Stockholders'
      Equity:Common stock and additional paid-in
      capital
    4,392,127
    4,391,001Retained earnings
    5,940,379
    5,710,31210,332,506
    10,101,313Treasury stock - at
    cost
    (892,969)
    (892,969)Total stockholders' equity
    9,439,537
    9,208,344$ 
      13,774,174
    $ 
      14,890,618 See notes to condensed consolidated
financial statements.    TAYLOR DEVICES, INC. AND
      SUBSIDIARYCondensed
      Consolidated Statements of Income
    (Unaudited)
    (Unaudited)For the three months
      ended November 30,
    For the six months
      ended November 30,2005
    2004
    2005
    2004Sales, net
    $ 
      3,370,028
    $ 
      2,649,727
    $ 
      6,480,127
    $ 
      5,101,146Cost of goods sold
    2,293,177
    1,854,465
    4,427,967
    3,450,090Gross
      profit
    1,076,851
    795,262
    2,052,160
    1,651,056Selling, general and administrative
      expenses
    847,007
    754,758
    1,596,463
    1,447,720Operating
      income
    229,844
    40,504
    455,697
    203,336Other expense, net
    (18,514)
    (34,333)
    (50,576)
    (69,062)Income before provision for income
      taxes, equity in netincome of affiliate
      and minority stockholder's interest
    211,330
    6,171
    405,121
    134,274Provision for income taxes
      (benefit)
    81,000
    (12,800)
    154,000
    38,000Income before equity in net income
      of affiliateand minority
      stockholder's interest
    130,330
    18,971
    251,121
    96,274Equity in net income (loss) of
      affiliate
    (2,202)
    3,971
    (6,452)
    7,818Income before minority
      stockholder's interest
    128,128
    22,942
    244,669
    104,092Minority stockholder's
      interest
    (7,378)
    (9,504)
    (14,602)
    (17,005)Net
      income
    $     120,750
    $    
      13,438
    $   
      230,067
    $     
      87,087Basic and diluted earnings per
      common share
    $     
      0.04
    $      -
    $      0.07
    $       0.03 See notes to condensed consolidated
financial statements.    TAYLOR DEVICES, INC. AND
      SUBSIDIARYCondensed
      Consolidated Statements of Cash Flows(Unaudited)November 30,For the six months
    ended
    2005
    2004Cash flows from
      operating activities:Net income
    $     230,067
    $    
      87,087Adjustments to reconcile net income
      to net cash flows fromoperating
      activities:Depreciation and
      amortization
    162,398
    175,761Gain on sale of
    equipmentBad debts expense
    9,157
    16,000Equity in net income (loss) of
      affiliate
    6,452
    (7,818)Deferred income taxesMinority stockholder's
      interest
    14,602
    17,005Changes in other assets and
      liabilities:Accounts receivable
    946,346
    (184,773)Inventory
    166,530
    (708,505)Costs and estimated earnings in
      excess of billings
    (163,854)
    (606,306)Other current assets
    2,429
    (69,488)Payables - trade
    129,963
    (120,590)Accrued commissions
    60,162
    (65,933)Billings in excess of costs and
      estimated earnings
    (19,464)
    409,167Other current
    liabilities
    157,728
    (18,640)Net cash flows from
      (for) operating activities
    1,702,516
    (1,077,033)Cash flows from
      investing activities:Acquisition of property and
      equipment
    (35,694)
    (111,559)Other investing
      activities
    11,993
    15,623Net cash flows for
      investing activities
    (23,701)
    (95,936)Cash flows from
      financing activities:Net short-term borrowings and
      repayments on long-term debt
    (1,518,996)
    1,499,474Payables - affiliate
    (171,632)
    (110,569)Proceeds from long-term
      debtProceeds from issuance of common
      stock
    1,126
    63,779Net cash flows from
      (for) financing activities
    (1,689,502)
    1,452,684Net increase (decrease) in cash and
      cash equivalents
    (10,687)
    279,715Cash and cash equivalents -
      beginning
    63,397
    88,390Cash and cash
      equivalents - ending
    $       52,710
    $   
      368,105 See notes to condensed consolidated
financial statements.    TAYLOR DEVICES, INC.  Notes to Condensed
Consolidated Financial Statements 1.
    The accompanying
      unaudited condensed consolidated financial statements have been prepared
      in accordance with accounting principles generally accepted in the United
      States of America for interim financial information and with the
      instructions to Form 10-QSB and Regulation S-B.  Accordingly, they do
      not include all of the information and footnotes required by accounting
      principles generally accepted in the United States of America for complete
      financial statements. In the opinion of the Company, the accompanying
      unaudited condensed consolidated financial statements contain all
      adjustments (consisting of only normal recurring accruals) necessary to
      present fairly the financial position as of November 30, 2005 and May 31,
      2005, the results of operations for the three and six months ended
      November 30, 2005 and November 30, 2004, and cash flows for the six months
      ended November 30, 2005 and November 30, 2004.  These financial
      statements should be read in conjunction with the audited financial
      statements and notes thereto contained in the Company's Annual Report to
      Shareholders for the year ended May 31, 2005.2.
    There is no provision
      nor shall there be any provisions for profit sharing, dividends, or any
      other benefits of any nature at any time for this fiscal
      year.3.
    For the three and six
      month periods ended November 30, 2005 and 2004 the net income was divided
      by 3,102,151 and 3,007,255, respectively, which is net of the Treasury
      shares, to calculate the net income per
    share.4.
    The results of
      operations for the six month period ended November 30, 2005 are not
      necessarily indicative of the results to be expected for the full
      year.5.
    Significant Equity
      Investee: The Company owns approximately a 23% equity investment in Tayco
      Developments, Inc. (Developments).  For the six months ended November
      30, 2005, Tayco Developments, Inc. had revenues of $114,000 and net income
      of $25,000.  The carrying amount of the investment in Tayco
      Developments, Inc. as of November 30, 2005 and May 31, 2005 was $445,000
      and $452,000.
    TAYLOR DEVICES, INC.  Item 2.  Management's
Discussion and Analysis or Plan of Operation Cautionary
Statement The Private Securities
Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking
statements.  Information in this Item 2, "Management's Discussion and
Analysis or Plan of Operation," and elsewhere in this 10-QSB that does not
consist of historical facts, are "forward-looking statements."  Statements
accompanied or qualified by, or containing, words such as "may," "will,"
"should," "believes," "expects," "intends," "plans," "projects," "estimates,"
"predicts," "potential," "outlook," "forecast," "anticipates," "presume," and
"assume" constitute forward-looking statements, and as such, are not a guarantee
of future performance.  The statements involve factors, risks and
uncertainties, the impact or occurrence of which can cause actual results to
differ materially from the expected results described in such statements. 
Risks and uncertainties can include, among others, fluctuations in general
business cycles and changing economic conditions; changing product demand and
industry capacity; increased competition and pricing pressures; advances in
technology that can reduce the demand for the Company's products, as well as
other factors, many or all of which may be beyond the Company's control. 
Consequently, investors should not place undue reliance on forward-looking
statements as predictive of future results.  The Company disclaims any
obligation to release publicly any updates or revisions to the forward-looking
statements herein to reflect any change in the Company's expectations with
regard thereto, or any changes in events, conditions or circumstances on which
any such statement is based. Results of
Operations A summary of the period to
period changes in the principal items included in the consolidated statements of
income is shown below: Summary comparison
      of the six months ended November 30, 2005 and 2004Increase /(Decrease)Sales,
net
    
    $ 1,379,000Cost of goods
      sold
    
    $   
      978,000Selling, general and
      administrative expenses
    
    $   
      149,000Other expense,
      net
    
    $    
      (18,000)Income before provision
      for income taxes, equity in net income of affiliate and minority
      stockholder's interest
    
    $   
      271,000Provision for income
      taxes (benefit)
    
    $   
      116,000Income before equity in
      net income of affiliate and minority stockholder's
    interest
    
    $   
      155,000Equity in net income
      (loss) of affiliate
    
    $    
      (14,000)Net
income
    
    $   
      143,000
 Sales under certain
fixed-price contracts, requiring substantial performance over several periods
prior to commencement of deliveries, are accounted for under the
percentage-of-completion method of accounting whereby revenues are recognized
based on estimates of completion prepared on a ratio of cost to total estimated
cost basis.  Costs include all material and direct and indirect charges
related to specific contracts. Adjustments to cost estimates
are made periodically and any losses expected to be incurred on contracts in
progress are charged to operations in the period such losses are
determined.  However, any profits expected on contracts in progress are
recognized over the life of the contract. For financial statement
presentation purposes, the Company nets progress billings against the total
costs incurred on uncompleted contracts.  The asset, "costs and estimated
earnings in excess of billings," represents revenues recognized in excess of
amounts billed.  The liability, "billings in excess of costs and estimated
earnings," represents billings in excess of revenues recognized. For the six months ended
November 30, 2005(All figures being
discussed are for the six months ended November 30, 2005 as compared to the six
months ended November 30, 2004.) Six months ended
    ChangeNovember 30, 2005
    November 30, 2004
    Increase / (Decrease)
    Percent ChangeNet
      Revenue
    $6,480,000
    $5,101,000
    $ 1,379,000
    27%Cost of
      sales
    4,428,000
    3,450,000
    978,000
    28%Gross
      profit
    $2,052,000
    $1,651,000
    $        401,000
    24%1⁄4as a percentage of net
      revenues
    32%
    32% The Company's consolidated
results of operations showed a 27% increase in net revenues and an increase in
net income of 164%. Gross profit increased by 24%.  Revenues recorded in
the current period for long-term construction projects increased by 70% over the
unusually low level recorded in the prior year.  These current year's
projects contributed a gross profit margin of 35% as compared to 33% in the
prior year's period.  The overall gross profit as a percentage of net
revenues for the current and prior year periods was 32%. The Company's revenues and
net income fluctuate from period to period.  The increases in the current
period, compared to the prior period, are not necessarily representative of
future results. Selling, General and
      Administrative Expenses Six months ended
    Change November 30, 2005
    November 30, 2004
    Increase / (Decrease)
    Percent ChangeOutside
      Commissions
    $   365,000
    $   181,000
    $  184,000
    102%Royalties
    58,000
    92,000
    (34,000)
    -37%Other
      SG&A
    1,173,000
    1,174,000
    ( 
      1,000)
    -Total
      SG&A
    $1,596,000
    $1,447,000
    $  149,000
    10%1⁄4as a percentage of net
      revenues
    25%
    28% Selling, general and
administrative expenses increased by 10% from the prior year.  Commission
expense doubled last year's level.  Commission expense was higher in this
period due to higher commission rates on a few of the large, long-term
construction projects in production in addition to a higher volume of sales
subject to commission.  Royalty expense is 37% less than the amount
recorded in the prior year period.  There were fewer shipments that were
subject to the royalty during the current year.  Other selling, general and
administrative expenses remained constant from last year to this. The above factors resulted in
operating income of $456,000 for the six months ended November 30, 2005, up 124%
from the $203,000 in the same period of the prior year. Other expense, net, of
$51,000 is primarily interest expense and is 27% less than in the prior
year.  Interest expense decreased by $17,000 from the prior year.  The
average level of use of the Company's operating line of credit decreased
significantly as compared to last year.  The line of credit is used
primarily to fund the production of larger projects that do not allow for
advance payments or progress payments.  Advance payments on long-term
construction contracts provided sufficient cash flow to pay off the line of
credit in full as of November 30, 2005. For the three months ended
November 30, 2005(All figures being
discussed are for the three months ended November 30, 2005 as compared to the
three months ended November 30, 2004.) Summary comparison of the three
      months ended November 30, 2005 and 2004Increase
    /(Decrease)Sales,
net
    
    $   
      720,000Cost of goods
      sold
    
    $   
      439,000Selling, general and
      administrative expenses
    
    $     
      92,000Other expense,
      net
    
    $    
      (16,000)Income before provision
      for income taxes, equity in net income of affiliate and minority
      stockholder's interest
    
    $   
      205,000Provision for income
      taxes (benefit)
    
    $     
      94,000Income before equity in
      net income of affiliate and minority stockholder's
    interest
    
    $   
      111,000Equity in net income
      (loss) of affiliate
    
    $       (6,000)Net
income
    
    $   
      107,000
  Three months ended
    ChangeNovember 30, 2005
    November 30, 2004
    Increase / (Decrease)
    Percent ChangeNet
      Revenue
    $3,370,000
    $2,650,000
    $   
      720,000
    27%Cost of
      sales
    2,293,000
    1,854,000
    439,000
    24%Gross
      profit
    $1,077,000
    $   796,000
    $   
      281,000
    35%1⁄4as a percentage of net
      revenues
    32%
    30% The Company's consolidated
results of operations showed a 27% increase in net revenues with an increase in
net income from $13,000 to $121,000. Gross profit increased by 35%. 
Revenues recorded in the current period for long-term construction projects
increased by 43% over the level recorded in the prior year.  These current
year's projects contributed a gross profit margin of 36% as compared to 30% in
the prior year's period.  The overall gross profit as a percentage of net
revenues for the quarter was 32% as compared to 30% for the same period in the
prior year. The Company's revenues and
net income fluctuate from period to period.  The increases in the current
period, compared to the prior period, are not necessarily representative of
future results. Selling, General and
      Administrative Expenses Three months ended
    ChangeNovember 30, 2005
    November 30, 2004
    Increase / (Decrease)
    Percent ChangeOutside
      Commissions
    $  
      241,000
    $     77,000
    $ 
      164,000
    213%Royalties
    24,000
    56,000
    (32,000)
    -57%Other
      SG&A
    582,000
    622,000
    (  40,000)
    -6%Total
      SG&A
    $   847,000
    $   755,000
    $    92,000
    12%1⁄4as a percentage of net
      revenues
    25%
    28% Selling, general and
administrative expenses increased by 12% from the prior year.  Commission
expense increased by $164,000 over last year's level.  Commission expense
was higher in this period due to higher commission rates on a few of the large,
long-term construction projects in production in addition to a higher volume of
sales subject to commission.  Royalty expense is 57% less than the amount
recorded in the prior year period.  There were fewer shipments that were
subject to the royalty during the current year.  Other selling, general and
administrative expenses decreased 6% from last year to this. The above factors resulted in
an operating income of $230,000 for the three months ended November 30, 2005 as
compared to $41,000 in the same period of the prior year. Other expense, net, of
$19,000 is primarily interest expense and is 46% less than in the prior
year.  Interest expense decreased by $15,000 from the prior year for the
same reasons noted above for the six month period. Capital
Resources, Line of Credit and Long-Term Debt The Company's primary
liquidity relates to the working capital needs.  These are primarily
inventory, accounts receivable, costs and estimated earnings in excess of
billings, accounts payable, accrued commissions, billings in excess of costs and
estimated earnings, and debt service.  The Company's primary sources of
liquidity have been from operations and from bank financing. Capital expenditures for the
six months ended November 30, 2005 were $36,000 compared to $112,000 in the same
period of the prior year.  There are no material commitments for capital
expenditures as of November 30, 2005. The Company has a $5,000,000
line of credit which is not being utilized as of November 30, 2005.  This
is down from the $1,390,000 balance outstanding as of May 31, 2005.  The
outstanding balance on the line of credit will fluctuate as the Company's
various long-term projects progress. Principal maturities of
long-term debt for the remainder of the current fiscal year and the subsequent
five years are as follows: 2006 - $102,000; 2007 - $241,000; 2008 - $232,000;
2009 - $138,000; 2010 - $72,000; and 2011 - $27,000. Inventory and
      Maintenance Inventory November 30, 2005
    May 31, 2005
    Increase Raw
      Materials
    $  
      399,000
    
    $   404,000
    
    $    (5,000)
    -1%Work in
      process
    3,740,000
    
    4,029,000
    
    (289,000)
    -7%Finished
      goods
    330,000
    
    338,000
    
    (8,000)
    -2%Inventory
    4,469,000
    85%
    4,771,000
    88%
    (302,000)
    -6%Maintenance
      and other inventory
    797,000
    15%
    662,000
    12%
    135,000
    20%Total
    $5,266,000
    100%
    $5,433,000
    100%
    $(167,000)
    -3%Inventory turnover
    1.7
    
    1.5
 NOTE: Inventory
      turnover is annualized for the six-month period ending November 30,
      2005. Inventory, at $4,469,000 as
of November 30, 2005, is 6% lower than the prior year-end.  Of this,
approximately 84% is work in process, 7% is finished goods, and 9% is raw
materials. Maintenance and other
inventory represent stock that is estimated to have a product life cycle in
excess of twelve months. This stock represents certain items that the Company is
required to maintain for service of products sold and items that are generally
subject to spontaneous ordering.  This inventory is particularly sensitive
to technical obsolescence in the near term due to its use in industries
characterized by the continuous introduction of new product lines, rapid
technological advances and product obsolescence.  Management of the Company
has recorded an allowance for potential inventory obsolescence. The provision
for potential inventory obsolescence was $50,000 for the six-month period ended
November 30, 2005 and $60,000 for the same period last year.  The Company
continues to rework slow-moving inventory, where applicable, to convert it to
product to be used on customer orders. Accounts Receivable,
      Costs and Estimated Earnings in Excess of Billings, and
      Billings in Excess of Costs and Estimated Earnings November 30,
      2005
    May 31, 2005
    Increase /(Decrease) Accounts
      receivable
    $1,763,000
    
    $2,719,000
    
    $
      (956,000)
    -35% Costs and
      estimated earnings in excess of billings
    1,821,000
    
    1,657,000
    
    164,000
    10% Less:
      Billings in excess of costs and estimated earnings
    269,000
    
    288,000
    
    (19,000)
    -7% Net
    $3,315,000
    
    $4,088,000
    
    $
      (773,000)
    -19% The Company combines the
totals of accounts receivable, the asset "costs and estimated earnings in excess
of billings", and the liability, "billings in excess of costs and estimated
earnings", to determine how much cash the Company will eventually realize from
revenue recorded to date.  As the accounts receivable figure rises in
relation to the other two figures, the Company can anticipate increased cash
receipts within the ensuing 30-60 days. Accounts receivable of
$1,763,000 as of November 30, 2005 includes approximately $242,000 of amounts
retained by customers on long-term construction projects.  The Company
expects to collect all of these amounts, including the retainage, during the
next twelve months. As noted above, the current
asset, "costs and estimated earnings in excess of billings," represents revenues
recognized in excess of amounts billed.  Whenever possible, the Company
negotiates a provision in sales contracts to allow the Company to bill, and
collect from the customer, payments in advance of shipments. 
Unfortunately, provisions such as this are often not possible in certain
governmental and foreign customers.  The $1,821,000 balance in this account
at November 30, 2005 is a 10% increase from the prior year-end.  The
Company expects to bill the entire amount during the next twelve
months. As noted above, the current
liability, "billings in excess of costs and estimated earnings", represents
billings to customers in excess of revenues recognized.  The $269,000
balance in this account at November 30, 2005 is only a slight change from the
balance at the end of the prior year.  Final delivery of product under
these contracts is expected to occur during the next twelve months. The Company's backlog of
sales orders at November 30, 2005 is $11.9 million, up from the backlog at the
end of the prior year of $7.3 million.  $3.9 million of the current backlog
is on projects already in progress. Accounts payable, at $900,000
as of November 30, 2005, is approximately $130,000 more than the prior
year-end. Commission expense on
applicable sales orders is recognized at the time revenue is recognized. 
The commission is paid following receipt of payment from the customers. 
Accrued commissions as of November 30, 2005 are $637,000.  This is slightly
more than the $577,000 accrued at the prior year-end.  The Company expects
the current accrued amount to be paid during the next twelve months.  Other
accrued expenses increased by 41% from the prior year-end to $544,000 primarily
due to an increase in accrued income taxes by $119,000. The Company paid $181,000 to
Developments during the six months ended November 30, 2005 to reduce the
principal balance on the note payable. Management
believes that the Company's cash flows from operations and borrowing capacity
under the bank line of credit will be sufficient to fund ongoing operations,
capital improvements and share repurchases for the next twelve
months.


TAYLOR DEVICES, INC. Item 3.  Controls and
Procedures (a)
          Evaluation of
disclosure controls and procedures. The Company's principal
executive officer and principal financial officer have evaluated the Company's
disclosure controls and procedures as of November 30, 2005 and have concluded
that as of the evaluation date, the disclosure controls and procedures were
adequate to ensure that material information relating to the Company was made
known to the officers by others within the Company. (b)           Changes in
internal
controls. There have been no changes in
the Company's internal controls over financial reporting that occurred during
the fiscal quarter that have materially affected, or are reasonably likely to
materially affect, the Company's control over financial reporting.   TAYLOR DEVICES, INC.  Part II - Other
Information ITEM 1
    Legal
      ProceedingsNone except for routine
      litigation incidental to the Company's business.ITEM 2
    Unregistered Sales of
      Equity Securities and Use of Proceeds(a)
    The Company sold no
      equity securities during the fiscal quarter ended November 30, 2005 that
      were not registered under the Securities Act.(b)
    Use of proceeds
      following effectiveness of initial registration
statement:Not Applicable(c)
    Repurchases of Equity SecuritiesPeriod
    (a) Total  Number
      ofSharesPurchased
    (b)AveragePrice PaidPer
      Share
    (c) Total Numberof Shares Purchasedas Part
      ofPubliclyAnnounced Plansor Programs
    (d)
      MaximumNumber (orApproximate DollarValue) of Shares 
      that May YetBe Purchased Underthe Plans
      orProgramsDecember 1, 2004 -December 31, 2004
    -
    -
    -January 1, 2005
      -  January 31, 2005
    -
    -
    -November 1, 2005
      -  November 30, 2005
    -
    -
    -Total
    -
    -
    -
    $160,802 (1)
 (1) In 1998, the
      Company initiated a plan to purchase shares of its outstanding common
      stock through open market purchases, with an initial deposit to the
      program of $225,000.  Additional deposits of $435,000 have been made
      to the plan, with expenditures of $499,198.  To date, a total of
      164,696 shares have been purchased at an average price per share of
      $3.03.(d)
    Under the terms of the
      Company's credit arrangements with its major lender, the Company is
      prohibited from issuing cash dividends.  In addition, the credit
      arrangements require the Company to maintain net working capital of at
      least $2,000,000 and tangible net worth of at last $6,000,000, as such
      terms are defined in the credit documents.  On November 30, 2005,
      under such definitions the Company's net working capital and tangible net
      worth were significantly in excess of such limits.ITEM
    3
    Defaults Upon Senior
      SecuritiesNoneITEM 4
    Submission of Matters to Vote of Securities
      Holders
      The Annual Meeting of
      Shareholders was held on November 11, 2005.  The total outstanding
      number of shares on the meeting record date of September 22, 2005 was
      3,102,057.  A total of 2,793,388 shares were present in person or by
      proxy at the meeting.  The following are the election results for the
      slate of directors presented by management.
      One Class 1 Director of
      the Company was elected to serve a three year term expiring in
      2008.
      Reginald B. Newman II -
      2,756,272 shares were voted for, 37,116 shares were
      withheld, and 1,431,755 shares were broker non-votes.
      Directors whose term of office continued after the meeting are Douglas P.
      Taylor, Randall L. Clark, Richard G. Hill and Donald B. Hofmar.
      The shareholders
      approved the adoption of the 2005 Taylor Devices, Inc. Stock Option Plan
      and the reservation of 140,000 shares of the Company's common stock for
      grant of options under the Plan.ITEM 5
    Other Information(a)
    Information required to
      be disclosed in a Report on Form 8-K, but not
      reportedNone(b)
    Material changes to the
      procedures by which Security Holders may recommend nominees to the
      Registrant's Board of DirectorsNoneITEM 6
    
    Exhibits10
    Form of Indemnity Agreement between the Company and
      Reginald B. Newman II, Secretary and Director, signed and dated November
      11, 2005.20
    News from Taylor Devices, Inc. Shareholder Letter,
      Winter 2005-2006.31(i)
    Rule 13a-14(a) Certification of Chief Executive
      Officer.31(ii)
    Rule 13a-14(a) Certification of Chief Financial
      Officer.32(i)
    Section 1350 Certification of Chief Executive
      Officer.32(ii)
    Section 1350 Certification of Chief Financial
      Officer.
 Report of Independent
Registered Public Accounting Firm The Board of Directors and
StockholdersTaylor Devices, Inc. We have reviewed the
accompanying condensed consolidated balance sheet of Taylor Devices, Inc. and
Subsidiary as of November 30, 2005, the related condensed consolidated
statements of income for the three and six months ended November 30, 2005 and
November 30, 2004 and cash flows for the six months ended November 30, 2005 and
November 30, 2004.  These interim financial statements are the
responsibility of the Company's management. We conducted our review in
accordance with standards of the Public Company Accounting Oversight Board
(United States).  A review of interim financial information consists
principally of applying analytical procedures and making inquiries of persons
responsible for financial and accounting matters.  It is substantially less
in scope than an audit conducted in accordance with standards of the Public
Company Accounting Oversight Board, the objective of which is the expression of
an opinion regarding the financial statements taken as a whole. 
Accordingly, we do not express such an opinion. Based on our reviews, we are
not aware of any material modifications that should be made to the accompanying
interim condensed consolidated financial statements referred to above for them
to be in conformity with accounting principles generally accepted in the United
States of America. We have previously audited,
in accordance with standards of the Public Company Accounting Oversight Board
(United States), the consolidated balance sheet as of May 31, 2005, and the
related consolidated statements of income, changes in stockholders' equity, and
cash flows for the year then ended (not presented herein); and in our report
dated July 22, 2005, we expressed an unqualified opinion on those financial
statements.  In our opinion, the information set forth in the accompanying
condensed consolidated balance sheet as of May 31, 2005 is fairly stated, in all
material respects, in relation to the balance sheet from which it has been
derived. Lumsden & McCormick,
LLPBuffalo, New YorkJanuary 6, 2006    TAYLOR DEVICES,
INC.  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.  TAYLOR DEVICES,
      INC.(Registrant)  By:
    s/Douglas P.
      Taylor
    
    Date:
    January 13,
      2006Douglas P.
      TaylorPresidentChairman of the Board of Directors(Principal
      Executive Officer)
  AND
  By:
    s/Mark V.
      McDonough
    
    Date:
    January 13,
      2006Mark V.
      McDonoughChief Financial Officer