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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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 June 30, 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 333-116673



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DA-LITE SCREEN COMPANY, INC.

(Exact Name of Registrant as Specified in its Charter)



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|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|Indiana                                                        |  | 35-1013951                             
|(State or Other Jurisdiction of Incorporation or Organization) |  | (I.R.S. Employer Identification Number)



|                                                        |  |           
|------------------------------------------------------- |  | ----------
|3100 North Detroit Street, P.O. Box 137 Warsaw, Indiana |  | 46581-0137
|(Address of Principal Executive Offices)                |  | (Zip Code)

Registrants telephone number, including area code: (574) 267-8101



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

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



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

Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ̈Accelerated
filer ̈Non-accelerated filer  x

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

As of August 9, 2006, there were 5,370.12 shares of the registrants common stock outstanding (all of which are privately owned and are not traded
on any public market).



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##### Table of Contents

TABLE OF CONTENTS



|        |  |                                                                                       |  |     
|------- |  | ------------------------------------------------------------------------------------- |  | ----
|        |  |                                                                                       |  | Page
|PART I  |  | Financial Information                                                                 |  |     
|        |  |                                                                                      
|Item 1. |  | Condensed Consolidated Financial Statements (unaudited)                               |  | 1   
|        |  |                                                                                      
|Item 2. |  | Managements Discussion and Analysis of Financial Condition and Results of Operations |  | 10  
|        |  |                                                                                      
|Item 3. |  | Quantitative and Qualitative Disclosures About Market Risk                            |  | 15  
|        |  |                                                                                      
|Item 4. |  | Controls and Procedures                                                               |  | 16  
|        |  |                                                                                      
|PART II |  | Other Information                                                                     |  |     
|        |  |                                                                                      
|Item 1. |  | Legal Proceedings                                                                     |  | 17  
|        |  |                                                                                      
|Item 2. |  | Unregistered Sales of Equity Securities and Use of Proceeds                           |  | 17  
|        |  |                                                                                      
|Item 6. |  | Exhibits                                                                              |  | 17  
|        |  |                                                                                      
|        |  | Signatures                                                                            |  | 18  
|        |  |                                                                                      
|        |  | Exhibit Index                                                                         |  | 19  



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PART I

FINANCIAL INFORMATION

Item 1. Financial Statements.

DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands)



|                                                                                                       |  |                         |         |   |                  |   |         |  
|------------------------------------------------------------------------------------------------------ |  | ----------------------- | ------- | - | ---------------- | - | ------- | -
|                                                                                                       |  | (Unaudited)June 30,2006 |         |   | December 30,2005 |  
|Assets                                                                                                 |  |                         |         |   |                  |   |         |  
|Current Assets:                                                                                        |  |                         |         |   |                  |   |         |  
|Cash and cash equivalents                                                                              |  | $                       | 6,584   |   |                  | $ | 12,547  |  
|Accounts receivable, less allowance for doubtful accounts                                              |  |                         | 18,904  |   |                  |   | 16,492  |  
|Inventories                                                                                            |  |                         | 12,641  |   |                  |   | 12,195  |  
|Prepaid expenses and other                                                                             |  |                         | 1,499   |   |                  |   | 439     |  
|Prepaid income taxes                                                                                   |  |                         |        |   |                  |   | 179     |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Total current assets                                                                                   |  |                         | 39,628  |   |                  |   | 41,852  |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Property, plant and equipment                                                                          |  |                         | 55,367  |   |                  |   | 52,803  |  
|Less accumulated depreciation                                                                          |  |                         | 34,915  |   |                  |   | 32,610  |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Net property, plant, and equipment                                                                     |  |                         | 20,452  |   |                  |   | 20,193  |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Goodwill                                                                                               |  |                         | 26,267  |   |                  |   | 25,851  |  
|Other assets, net                                                                                      |  |                         | 3,738   |   |                  |   | 5,193   |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|                                                                                                       |  | $                       | 90,085  |   |                  | $ | 93,089  |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Liabilities and Stockholders Deficit                                                                  |  |                         |         |   |                  |   |         |  
|Current liabilities:                                                                                   |  |                         |         |   |                  |   |         |  
|Accounts payable                                                                                       |  | $                       | 4,080   |   |                  | $ | 4,318   |  
|Accrued expenses                                                                                       |  |                         |         |   |                  |   |         |  
|Interest                                                                                               |  |                         | 1,700   |   |                  |   | 1,754   |  
|Other                                                                                                  |  |                         | 4,823   |   |                  |   | 4,495   |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Total accrued expenses                                                                                 |  |                         | 6,523   |   |                  |   | 6,249   |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Total current liabilities                                                                              |  |                         | 10,603  |   |                  |   | 10,567  |  
|Long-term debt                                                                                         |  |                         | 140,200 |   |                  |   | 144,200 |  
|Minority interest                                                                                      |  |                         | 1,035   |   |                  |   | 960     |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Total liabilities                                                                                      |  |                         | 151,838 |   |                  |   | 155,727 |  
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Commitments and contingencies (note 9)                                                                 |  |                         |         |   |                  |   |         |  
|                                                                                                       |  |                        
|Stockholders deficit:                                                                                 |  |                         |         |   |                  |   |         |  
|Common stock, $1 par value. Authorized 1,000,000 shares; issued 10,686 shares                          |  |                         | 11      |   |                  |   | 11      |  
|Additional paid-in capital                                                                             |  |                         | 618     |   |                  |   | 574     |  
|Accumulated deficit                                                                                    |  |                         | (40,511 | ) |                  |   | (40,036 | )
|Accumulated other comprehensive income                                                                 |  |                         | 2,053   |   |                  |   | 439     |  
|Less treasury stock, 5,315.12 shares at June 30, 2006 and 5,314.38 shares at December 30, 2005 at cost |  |                         | (23,924 | ) |                  |   | (23,626 | )
|                                                                                                       |  |                         |         |   |                  |   |         |  
|Total stockholders deficit                                                                            |  |                         | (61,753 | ) |                  |   | (62,638 | )
|                                                                                                       |  |                         |         |   |                  |   |         |  
|                                                                                                       |  | $                       | 90,085  |   |                  | $ | 93,089  |  
|                                                                                                       |  |                         |         |   |                  |   |         |  

See accompanying notes to condensed consolidated financial statements.



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DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, except per share amounts, unaudited)



|                                              |  |                             |        |                            |   |                             |  |                            |        |  |   |       
|--------------------------------------------- |  | --------------------------- | ------ | -------------------------- | - | --------------------------- |  | -------------------------- | ------ |  | - | ------
|                                              |  | 13 WeeksEnded June 30, 2006 |        | 13 WeeksEnded July 1, 2005 |   | 26 WeeksEnded June 30, 2006 |  | 26 WeeksEnded July 1, 2005
|Net sales                                     |  | $                           | 43,367 |                            | $ | 42,039                      |  | $                          | 86,343 |  | $ | 83,954
|Cost of sales                                 |  |                             | 26,229 |                            |   | 25,638                      |  |                            | 51,884 |  |   | 51,193
|                                              |  |                             |        |                            |   |                             |  |                            |        |  |   |       
|Gross profit                                  |  |                             | 17,138 |                            |   | 16,401                      |  |                            | 34,459 |  |   | 32,761
|Selling, general, and administrative expenses |  |                             | 4,588  |                            |   | 4,627                       |  |                            | 9,967  |  |   | 9,213 
|                                              |  |                             |        |                            |   |                             |  |                            |        |  |   |       
|Operating income                              |  |                             | 12,550 |                            |   | 11,774                      |  |                            | 24,492 |  |   | 23,548
|                                              |  |                             |        |                            |   |                             |  |                            |        |  |   |       
|Other expense (income):                       |  |                             |        |                            |   |                             |  |                            |        |  |   |       
|Interest                                      |  |                             | 3,572  |                            |   | 3,693                       |  |                            | 7,058  |  |   | 7,387 
|Minority interest                             |  |                             | 42     |                            |   | 21                          |  |                            | 75     |  |   | 53    
|Miscellaneous, net                            |  |                             | 524    |                            |   | 66                          |  |                            | 523    |  |   | 65    
|                                              |  |                             |        |                            |   |                             |  |                            |        |  |   |       
|Total other expense                           |  |                             | 4,138  |                            |   | 3,780                       |  |                            | 7,656  |  |   | 7,505 
|                                              |  |                             |        |                            |   |                             |  |                            |        |  |   |       
|Income before income taxes                    |  |                             | 8,412  |                            |   | 7,994                       |  |                            | 16,836 |  |   | 16,043
|Income taxes                                  |  |                             | 441    |                            |   | 234                         |  |                            | 781    |  |   | 608   
|                                              |  |                             |        |                            |   |                             |  |                            |        |  |   |       
|Net income                                    |  | $                           | 7,971  |                            | $ | 7,760                       |  | $                          | 16,055 |  | $ | 15,435
|                                              |  |                             |        |                            |   |                             |  |                            |        |  |   |       

See accompanying notes to condensed consolidated financial statements.



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DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands, unaudited)



|                                                                                  |  |                             |         |   |                            |   |         |  
|--------------------------------------------------------------------------------- |  | --------------------------- | ------- | - | -------------------------- | - | ------- | -
|                                                                                  |  | 26 WeeksEnded June 30, 2006 |         |   | 26 WeeksEnded July 1, 2005 |  
|Cash flows from operating activities:                                             |  |                             |         |   |                            |   |         |  
|Net income                                                                        |  | $                           | 16,055  |   |                            | $ | 15,435  |  
|Adjustments to reconcile net income to net cash provided by operating activities: |  |                             |         |   |                            |   |         |  
|Depreciation                                                                      |  |                             | 2,053   |   |                            |   | 2,322   |  
|Amortization and write-off of debt issuance costs                                 |  |                             | 493     |   |                            |   | 405     |  
|Minority interest earnings                                                        |  |                             | 75      |   |                            |   | 53      |  
|Change in:                                                                        |  |                             |         |   |                            |   |         |  
|Accounts receivable                                                               |  |                             | (1,896  | ) |                            |   | (1,459  | )
|Inventories                                                                       |  |                             | (195    | ) |                            |   | (173    | )
|Prepaid expenses and other                                                        |  |                             | (1,045  | ) |                            |   | (440    | )
|Accounts payable                                                                  |  |                             | (643    | ) |                            |   | (679    | )
|Accrued expenses                                                                  |  |                             | 342     |   |                            |   | (750    | )
|Other                                                                             |  |                             | 963     |   |                            |   | (23     | )
|                                                                                  |  |                             |         |   |                            |   |         |  
|Net cash provided by operating activities                                         |  |                             | 16,202  |   |                            |   | 14,691  |  
|                                                                                  |  |                             |         |   |                            |   |         |  
|Cash flows from investing activities:                                             |  |                             |         |   |                            |   |         |  
|Purchase of property, plant and equipment                                         |  |                             | (1,495  | ) |                            |   | (1,406  | )
|                                                                                  |  |                             |         |   |                            |   |         |  
|Net cash used in investing activities                                             |  |                             | (1,495  | ) |                            |   | (1,406  | )
|                                                                                  |  |                             |         |   |                            |   |         |  
|Cash flows from financing activities:                                             |  |                             |         |   |                            |   |         |  
|Increase in checks written in excess of bank balance                              |  |                             |        |   |                            |   | 778     |  
|Payments to retire senior notes                                                   |  |                             | (4,000  | ) |                            |   |        |  
|Distributions to stockholders                                                     |  |                             | (16,530 | ) |                            |   | (13,800 | )
|Repurchase of common stock                                                        |  |                             | (338    | ) |                            |   | (350    | )
|Exercise of common stock options                                                  |  |                             | 84      |   |                            |   | 492     |  
|                                                                                  |  |                             |         |   |                            |   |         |  
|Net cash used in financing activities                                             |  |                             | (20,784 | ) |                            |   | (12,880 | )
|                                                                                  |  |                             |         |   |                            |   |         |  
|Effect of foreign currency exchange rate changes on cash and cash equivalents     |  |                             | 114     |   |                            |   | 83      |  
|                                                                                  |  |                             |         |   |                            |   |         |  
|Net change in cash and cash equivalents                                           |  |                             | (5,963  | ) |                            |   | 488     |  
|Cash and cash equivalents at beginning of period                                  |  |                             | 12,547  |   |                            |   | 9,306   |  
|                                                                                  |  |                             |         |   |                            |   |         |  
|Cash and cash equivalents at end of period                                        |  | $                           | 6,584   |   |                            | $ | 9,794   |  
|                                                                                  |  |                             |         |   |                            |   |         |  

See accompanying notes to condensed consolidated financial statements.



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DA-LITE SCREEN COMPANY, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. Basis of Presentation

The financial data presented herein is unaudited and should be read in conjunction with the consolidated financial statements and accompanying notes
included in the annual report on Form 10-K filed by Da-Lite Screen Company, Inc. (together with all of its subsidiaries, the Company or Da-Lite) for the fiscal year ended December 30, 2005. In the opinion of management,
the accompanying unaudited condensed consolidated financial statements include all of the adjustments necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. All
intercompany accounts and transactions have been eliminated. Results for interim periods should not be considered indicative of results for the full year.

The accompanying condensed consolidated financial statements include the accounts of Da-Lite Screen Company, Inc. (Da-Lite) and its subsidiary, Projecta B.V. (Projecta), a Netherlands limited liability company, which
is 96% owned by Da-Lite and Projectas wholly owned subsidiary Procolor S.A.S. (Procolor), a French corporation. All material intercompany accounts and transactions have been eliminated.

The Company uses a 52- or 53-week fiscal year ending on the last Friday of December. The first and second quarters of 2006 and 2005 were 13-week periods.
The Companys 2006 fiscal year will be a 52-week period and the 2005 fiscal year was a 52-week period.

2. Critical Accounting Policies and
Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of
America requires that management make a number of assumptions and estimates that affect the reported amounts of assets, liabilities, revenue and expenses in the consolidated financial statements and accompanying notes. Management bases its estimates
on historical experience and various other assumptions believed to be reasonable. Although these estimates are based on managements best knowledge of current events and actions that may impact the Company in the future, actual results may
differ from these estimates and assumptions. The Companys critical accounting policies are those that affect its consolidated financial statements materially and involve a significant level of judgment by management. There were no changes to
the Companys critical accounting policies during the quarter.

Revenue RecognitionThe Company recognizes revenue when it
has received an order from a customer, product has been shipped FOB shipping point, the sales price is fixed or determinable and the collectibility of sales price is reasonably assured. All amounts billed to customers in a sales transaction related
to shipping and handling are recorded as revenue, and costs incurred by the Company for shipping and handling are recorded as cost of sales in conformity with Emerging Issues Task Force (EITF) 00-10, Accounting for Shipping and Handling Fees and
Costs(EITF 00-10).

Allowance for Doubtful AccountsThe financial status of customers is routinely checked and monitored
by the Company when granting credit. The Company provides an allowance for doubtful accounts based upon historical experience and managements analysis of past due accounts.



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GoodwillGoodwill represents the excess of purchase price over the fair value of identifiable
net assets acquired. Management tests goodwill for impairment to determine whether its carrying value exceeds its implied fair value at least annually, or when events or changes in circumstances occur. Goodwill was not impaired in 2005 or during the
period ended June 30, 2006. The change in the balance of goodwill from December 30, 2005 to June 30, 2006 is the result of foreign currency translation.

Income TaxesDa-Lite is taxed under the provision of the Internal Revenue Code regulating small business corporations (Subchapter S). Under the provision of Subchapter S, tax liabilities and benefits flow
through to the stockholders of Da-Lite. Therefore, no provision or liability is recorded in the condensed consolidated financial statements for taxable income of Da-Lite. The Company pays foreign income taxes on the earnings of Projecta and
Procolor. Foreign income taxes are recorded in the consolidated financial statements.

3. Reclassification

Certain prior-year financial information has been reclassified to conform to the fiscal 2006 financial statement presentation.

For the thirteen weeks and twenty six weeks ended July 1, 2005, depreciation expense was classified separately on the condensed consolidated
statement of operations included in operating income below gross profit. For the thirteen weeks and twenty six weeks ended June 30, 2006, depreciation expense was included in Cost of sales and Selling, general and administrative expenses. Cost
of sales for the thirteen weeks and twenty six weeks ended July 1, 2005 was increased from amounts previously reported by $1.1 million and $2.3 million to conform to the fiscal 2006 presentation. The amounts reclassified from Selling, general
and administrative expenses were not significant in either period.

As discussed in note 2, the Company records amounts billed for shipping
and handling costs in accordance with EITF 00-10. Net sales for the thirteen weeks and twenty six weeks ended July 1, 2005 were increased from the amounts previously reported by $2.2 million and $4.3 million, respectively, to be in conformity
with EITF 00-10 which prescribes that shipping billings be recorded in revenues and corresponding costs be recorded in cost of sales. Cost of sales for the thirteen weeks and twenty six weeks ended July 1, 2005 were also increased from the
amounts previously reported by $2.4 million and $4.6 million, respectively. Selling, general and administrative expenses were reduced by $0.2 million and $0.3 million for the thirteen weeks and twenty six weeks ended July 1, 2005 to conform
with EITF 00-10.

4. Notes Payable, Revolving Credit Agreement and Long-term Debt

Long-term debt at June 30, 2006 and December 30, 2005 consisted of the following (in thousands):



|                      |  |               |         |                  |   |        
|--------------------- |  | ------------- | ------- | ---------------- | - | -------
|                      |  | June 30, 2006 |         | December 30,2005
|Senior notes due 2011 |  | $             | 140,200 |                  | $ | 144,200

The Company issued $160 million of 91/2% senior unsecured notes due in May 2011 during fiscal year 2004, which were subsequently exchanged for substantially identical notes that were registered
with the Securities and Exchange Commission (the 91/2% Senior Notes due 2011 or Notes).
The net proceeds from the issuance of the Notes were used during fiscal year 2004 to retire approximately $15.0 million of indebtedness outstanding under a then existing credit facility, to pay a special distribution to stockholders



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of approximately $134.6 million and for general corporate purposes. The Company may redeem any of the Notes beginning on
May 15, 2007 with an initial redemption price of 109.5% of their principal amount plus accrued interest. In addition, before May 15, 2007, the Company may redeem up to 35% of the Notes at a redemption price of 109.5% of their principal
amount plus accrued interest using the proceeds from sales of certain kinds of its capital stock. Any outstanding principal is due in May 2011 and interest is payable semi-annually in arrears on May 15 and November 15 of each year.

In the Indenture related to the 91/2% Senior Notes due 2011, the Company agreed to covenants that limit it and its restricted subsidiaries (i.e., Projecta B.V., Procolor S.A.S.) ability, among other things, to: (a) incur
additional debt and issue preferred stock, (b) pay dividends, acquire shares of capital stock, make payments on subordinated debt or make investments, (c) place limitations on distributions from restricted subsidiaries, (d) issue or
sell capital stock of restricted subsidiaries, (e) issue guarantees, (f) sell or exchange assets, (g) enter into transactions with stockholders and affiliates, (h) create liens and (i) effect mergers. In addition, if a
change of control occurs, each holder of Notes will have the right to require the Company to repurchase all or part of the holders Notes at a price equal to 101% of their principal amount, plus any accrued interest to the date of purchase. The
Company was in compliance with all covenants at June 30, 2006 and December 30, 2005.

The Company has an unsecured
revolving credit facility that expires in April 2008 with maximum possible borrowings equal to $10.0 million which replaced the $5.0 million revolving credit facility that expired in May 2006. At June 30, 2006 and December 30, 2005, the
Company had no outstanding balances under these lines of credit. Interest on outstanding borrowings related to the $10.0 million line of credit is calculated at the prime rate, which was 8.25% on June 30, 2006.

Projecta, the Companys Dutch subsidiary, has an overdraft line of credit with maximum possible borrowings equal to the lower of 1.5 million
Euros or certain percentages of Projectas eligible accounts receivable and inventory. At June 30, 2006 and December 30, 2005, Projecta had no outstanding balances under this line of credit and the maximum possible borrowings was
1.5 million Euros. Interest on outstanding borrowings related to this line of credit is calculated at the Fortis basic rate plus 1.50%, the sum of which was 5.00% on June 30, 2006.

The Company has provided an insurance carrier with a standby letter of credit for $0.5 million for self-insured amounts under its insurance program.

5. Stock Options

On December 31,
2005, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 123 (revised 2004), Share-Based Payment (SFAS 123R) using a prospective method. SFAS 123R requires the Company record compensation expense for stock options
or other share-based awards when future awards are granted.

The Company has a nonqualified stock option plan under which options are
granted to certain employees. Options under the plan generally vest one-fifth each year from the anniversary date of grant and additional awards are generally made each year. During 2004 and 2002, the Company also granted options to certain
employees that were immediately 100% vested. The options expire after ten years from the date of grant. Fair value calculations are based on highly subjective assumptions about the future. The Company used the Black-Scholes option pricing model and
the minimum value method and determined that the fair value of grants made was not material.



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The stock option activity and weighted average exercise prices follow:



|                                 |  |              |   |  |                |        |                                         |   |      
|-------------------------------- |  | ------------ | - |  | -------------- | ------ | --------------------------------------- | - | -----
|                                 |  | Year to Date
|                                 |  | Options      |   |  | Exercise Price |        | AggregateIntrinsic Value (in thousands)
|Outstanding at December 30, 2005 |  | 153          |   |  | $              | 16,530 |                                         |   |      
|Exercised                        |  | (9           | ) |  |                | 9,362  |                                         |   |      
|                                 |  |              |   |  |                |        |                                         |   |      
|Outstanding at June 30, 2006     |  | 144          |   |  | $              | 16,978 |                                         | $ | 2,223
|                                 |  |              |   |  |                |        |                                         |   |      
|Exercisable at June 30, 2006     |  | 142          |   |  | $              | 17,091 |                                         | $ | 2,176

6. Inventories

The Company accounts for its inventory at the lower of cost or market using the first-in, first-out (FIFO) method. Inventory at June 30, 2006 and December 31, 2005 is comprised of the following (in
thousands):



|                 |  |               |        |                  |   |       
|---------------- |  | ------------- | ------ | ---------------- | - | ------
|                 |  | June 30, 2006 |        | December 30,2005
|Raw materials    |  | $             | 7,516  |                  | $ | 7,030 
|Work in progress |  |               | 1,941  |                  |   | 1,651 
|Finished goods   |  |               | 3,184  |                  |   | 3,514 
|                 |  |               |        |                  |   |       
|                 |  | $             | 12,641 |                  | $ | 12,195
|                 |  |               |        |                  |   |       

7. Comprehensive Income

The changes in the components of comprehensive income are as follows for the periods ended (in thousands):



|                                                    |  |                              |       |                            |   |        |                              |  |                            |        |  |   |        |  
|--------------------------------------------------- |  | ---------------------------- | ----- | -------------------------- | - | ------ | ---------------------------- |  | -------------------------- | ------ |  | - | ------ | -
|                                                    |  | 13 Weeks Ended June 30, 2006 |       | 13 WeeksEnded July 1, 2005 |   |        | 26 Weeks Ended June 30, 2006 |  | 26 WeeksEnded July 1, 2005 |       
|Net income                                          |  | $                            | 7,971 |                            | $ | 7,760  |                              |  | $                          | 16,055 |  | $ | 15,435 |  
|Other comprehensive income:                         |  |                              |       |                            |   |        |                              |  |                            |        |  |   |        |  
|Cumulative foreign exchange translation adjustments |  |                              | 1,109 |                            |   | (1,283 | )                            |  |                            | 1,614  |  |   | (2,350 | )
|                                                    |  |                              |       |                            |   |        |                              |  |                            |        |  |   |        |  
|Total comprehensive income                          |  | $                            | 9,080 |                            | $ | 6,477  |                              |  | $                          | 17,669 |  | $ | 13,085 |  
|                                                    |  |                              |       |                            |   |        |                              |  |                            |        |  |   |        |  



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##### Table of Contents

8. Segment Information

The Company primarily manufactures projection screens and other meeting room equipment that are sold throughout the United States and Europe. Based on its operations, the Company has established two reportable
segments: United States and Europe. The United States segment includes the operations of Da-Lite; the Europe segment includes the operations of Projecta and Procolor. All significant intersegment transactions have been eliminated.

Operating cash flow is the measure reported to the chief operating decision maker for use in assessing segment performance and allocating resources.
Operating cash flow for segment reporting is net sales less operating costs and does not include depreciation and amortization, interest expense, or minority interest. The Company does not allocate costs between segments.

The following table presents financial information by segment for the periods stated (in thousands):



|                       |  |                              |        |                            |   |                              |  |                            |        |  |   |       
|---------------------- |  | ---------------------------- | ------ | -------------------------- | - | ---------------------------- |  | -------------------------- | ------ |  | - | ------
|                       |  | 13 Weeks Ended June 30, 2006 |        | 13 WeeksEnded July 1, 2005 |   | 26 Weeks Ended June 30, 2006 |  | 26 WeeksEnded July 1, 2005
|Net sales:             |  |                              |        |                            |   |                              |  |                            |        |  |   |       
|United States          |  | $                            | 35,851 |                            | $ | 36,155                       |  | $                          | 71,730 |  | $ | 71,295
|Europe                 |  |                              | 7,516  |                            |   | 5,884                        |  |                            | 14,613 |  |   | 12,659
|                       |  |                              |        |                            |   |                              |  |                            |        |  |   |       
|Total net sales        |  | $                            | 43,367 |                            | $ | 42,039                       |  | $                          | 86,343 |  | $ | 83,954
|                       |  |                              |        |                            |   |                              |  |                            |        |  |   |       
|Operating income:      |  |                              |        |                            |   |                              |  |                            |        |  |   |       
|United States          |  | $                            | 11,070 |                            | $ | 11,020                       |  | $                          | 21,860 |  | $ | 21,608
|Europe                 |  |                              | 1,480  |                            |   | 754                          |  |                            | 2,632  |  |   | 1,940 
|                       |  |                              |        |                            |   |                              |  |                            |        |  |   |       
|Total operating income |  | $                            | 12,550 |                            | $ | 11,774                       |  | $                          | 24,492 |  | $ | 23,548
|                       |  |                              |        |                            |   |                              |  |                            |        |  |   |       



|                  |  |               |         |                   |   |        
|----------------- |  | ------------- | ------- | ----------------- | - | -------
|                  |  | June 30, 2006 |         | December 30, 2005
|Total assets      |  |               |         |                   |   |        
|United States     |  | $             | 64,830  |                   | $ | 69,662 
|Europe            |  |               | 25,255  |                   |   | 23,427 
|                  |  |               |         |                   |   |        
|Total assets      |  | $             | 90,085  |                   | $ | 93,089 
|                  |  |               |         |                   |   |        
|Total liabilities |  |               |         |                   |   |        
|United States     |  | $             | 147,607 |                   | $ | 151,203
|Europe            |  |               | 4,231   |                   |   | 4,524  
|                  |  |               |         |                   |   |        
|Total liabilities |  | $             | 151,838 |                   | $ | 155,727
|                  |  |               |         |                   |   |        



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##### Table of Contents

9. Commitments and Contingencies

On May 19, 2006, Draper, Inc. (Draper), a competitor of the Company, filed an action entitled Draper, Inc. v. Da-Lite Screen Company, Inc. and Stewart Filmscreen Corporation in the United
States District Court for the Southern District of Indiana, Indianapolis Division. The complaint, as amended, alleges that certain projection screens manufactured by the Company and Stewart Filmscreen Corporation, another competitor of the Company,
infringe patents issued to Draper, and seeks unspecified damages and injunctive relief. The Company has filed an answer denying the allegations and asserting several affirmative defenses. The Company believes that it has good defenses to this suit
and intends to vigorously defend this action.

In addition, the Company is subject to certain other legal proceedings and claims that have
arisen in the ordinary course of business and which have not been fully adjudicated. In the opinion of management, the Company does not have a potential liability related to any of these other current legal proceedings and claims that should
individually or in the aggregate have a material adverse effect on its financial condition, liquidity or results of operations.

However,
the results of legal proceedings cannot be predicted with certainty. Should the Company fail to prevail in legal matters it is possible that its results of operations or financial condition could be materially adversely affected.

10. Subsequent Events

Disposition of Prior European Manufacturing
Facility

In July 2006, the Company obtained a letter of agreement for the sale of Projectas prior manufacturing facility in
Weert, The Netherlands, for 1.1 million Euros. The property is classified in Prepaid expenses and other, at a net book value of 0.8 million Euros (U.S. $1.0 million at June 30, 2006). The closing is subject to certain conditions and
is expected to occur in the third quarter of 2006.



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##### Table of Contents

Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.

Forward Looking
Statements

This quarterly report on Form 10-Q contains certain statements that may be deemed to be forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included in this report are
forward-looking statements. When used in this report, the words may, will, should, would, anticipate, estimate, expect, plan, believe,
predict, potential, intend, and similar expressions are intended to identify forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ
materially from those projected. These risks and uncertainties include, but are not limited to, changes in sales or industry trends, competition, retention of senior management and other key personnel, availability of materials or components,
ability to make continued product innovations, casualty or work stoppages at the Companys facilities and currency exchange rates. Forward-looking statements are based on assumptions and assessments made by the Companys management in
light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. Readers of this report are cautioned not to place undue reliance on these
forward-looking statements, as there can be no assurance that these forward-looking statements will prove to be accurate. Management undertakes no obligation to update any forward-looking statements. This cautionary statement is applicable to all
forward-looking statements contained in this report.

Overview

Da-Lite is the worlds leading manufacturer of projection screens based on internal estimates of market share. Projection screens are the Companys main product line and the Company produces three types:
(1) electrically operated screens, which have the ability to retract into a concealed ceiling recess or into a wall-mounted case, (2) wall screens, which are normally mounted on an exposed wall surface and may either be manually
retractable or attached to a rigid frame, and (3) portable screens which can easily be set up and removed. Da-Lite also sells custom engineered rear projection systems and complementary presentation products such as lecterns, easels,
audiovisual carts, monitor mounts and brackets for plasma and LCD displays.

Critical Accounting Policies

Da-Lites critical accounting policies are summarized in the Companys Annual Report on Form 10­K for the year ended December 30, 2005.
As of June 30, 2006, the Companys critical accounting policies had not changed from December 30, 2005.



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##### Table of Contents

Results of Operations

Thirteen Weeks Ended June 30, 2006, Compared with Thirteen Weeks Ended July 1, 2005

Net Sales. Net
sales were $43.4 million for the 13 weeks ended June 30, 2006, as compared to $42.0 million for the 13 weeks ended July 1, 2005, an increase of $1.4 million or 3.2%. Net sales by the Companys United States (U.S.) operations decreased
0.8%. In the U.S., electric screen sales increased $1.1 million primarily because demand for the Companys core business of electrically operated screens with viewing surfaces measuring 100 inches in diagonal and above continues to grow. Wall
screen sales decreased $0.2 million and were likely impacted by a slowdown in the housing market that has reduced the demand for the Companys products used in home cinemas. Portable screen sales decreased $0.5 million and sales of other
products decreased $0.6 million from 2005 levels. The decrease in sales of other products was a result of lower sales of screen fabric to other screen manufacturers during the 13 weeks ended June 30, 2006. Net sales from the Companys
European subsidiaries increased by $1.6 million or 27.7%. The increase in Europe resulted from an improvement in economic outlook for key customers as well as an increase in demand for screens leading up to the World Cup soccer event.

Cost of Sales. The cost of sales was $26.2 million for the 13 weeks ended June 30, 2006, as compared to $25.6 million for
the 13 weeks ended July 1, 2005, an increase of $0.6 million, or 2.3%. As a percentage of net sales, the cost of sales represented 60.5% and 61.0% for the 13 weeks ended June 30, 2006 and for the 13 weeks ended July 1, 2005,
respectively. This constitutes a 0.5 percentage-point improvement in margin. Margins at our U.S. facilities decreased 0.4 points, where an increase in health care costs during the period was the major contributing factor. Margins at our European
operations increased 3.3 points reflecting the increase in product volumes.

Selling, General and Administrative Expenses. Selling,
general and administrative expenses were $4.6 million for the 13 weeks ended June 30, 2006, as compared to $4.6 million for the 13 weeks ended July 1, 2005. Selling, general and administrative expenses in the U.S. decreased $0.1 million
resulting from a reduction in expense associated with Sarbanes-Oxley preparation partially offset by an increase in bad debts. Selling, general and administrative expenses in Europe increased $0.1 million as a result of increased spending in
operating costs.

Interest. Interest expense totaled $3.6 million for the 13 weeks ended June 30, 2006, as compared to
$3.7 million for the 13 weeks ended July 1, 2005, a decrease of $0.1 million. The decrease was a result of a reduction in the outstanding amount of the 91/2% Senior Notes due 2011 issued in May 2004.

Miscellaneous, net.
Miscellaneous, net was $0.5 million for the 13 weeks ended June 30, 2006, as compared to $0.1 million for the 13 weeks ended July 1, 2005, an increase of $0.4 million. The increase was primarily due to the premium of $0.3 million paid to
retire $4.0 million of the Companys 91/2% senior notes during the 13 weeks ended June 30, 2006.

Income Taxes. As a subchapter S corporation for United States tax purposes, the Company is generally not subject to United
States federal and state income taxation. Rather, the Companys income, gains, losses, deductions and credits flow through to its stockholders and the Company makes distributions to them to meet their tax obligations at an assumed maximum
federal and state tax rate (based on the state with the highest tax rate in which any of the Companys stockholders reside). This assumed rate was 40.4% for the 13 weeks ended June 30, 2006 and for the 13 weeks ended July 1, 2005. The
Company pays foreign income taxes on the earnings of its European subsidiaries.

Net Income. As a result
of the aforementioned factors, net income increased $0.2 million from $7.8 million for the 13 weeks ended July 1, 2005 to $8.0 million for the 13 weeks ended June 30, 2006.



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##### Table of Contents

Twenty-Six Weeks Ended June 30, 2006, Compared with Twenty-Seven Weeks Ended July 1, 2005

Net Sales. Net sales were $86.3 million for the 26 weeks ended June 30, 2006, as compared to $84.0 million for the 26
weeks ended July 1, 2005, an increase of $2.3 million or 2.8%. Net sales by the Companys United States (U.S.) operations increased 0.6%. In the U.S., electric screen sales increased $2.1 million primarily because demand for the
Companys core business of electrically operated screens with viewing surfaces measuring 100 inches in diagonal and above continues to grow. Wall screen sales decreased $0.6 million and were likely impacted by a slowdown in the housing market
that has reduced the demand for the Companys products used in home cinemas. Portable screen sales decreased $0.6 million and sales of other products decreased $0.6 million from 2005 levels. Net sales from the Companys European
subsidiaries increased by $2.0 million or 15.4%, with the stronger Euro offsetting $0.6 million of the overall increase. The increase in Europe resulted from an improvement in economic outlook for key customers as well as an increase in demand for
screens leading up to the World Cup soccer event.

Cost of Sales. The cost of sales was $51.9 million for the 26 weeks ended
June 30, 2006, as compared to $51.2 million for the 26 weeks ended July 1, 2005, an increase of $0.7 million, or 1.3%. As a percentage of net sales, the cost of sales represented 60.1% and 61.0% for the 26 weeks ended June 20, 2006
and the 26 weeks ended July 1, 2005, respectively. This constitutes a 0.9 percentage-point improvement in margin. Margins at our U.S. facilities increased 0.3 points while margin at our European operation increased 2.1 points reflecting the
increase in product volume.

Selling, General and Administrative Expenses. Selling, general and administrative expenses were $10.0
million for the 26 weeks ended June 30, 2006, as compared to $9.2 million for the 26 weeks ended July 1, 2005. Selling, general and administrative expenses in the U.S. increased $0.4 million. Increases in bad debt expense, compensation and
marketing offset a decrease associated with Sarbanes-Oxley preparation expense. Selling, general and administrative expenses in Europe increased $0.4 million as a result of increased spending in marketing programs.

Interest. Interest expense totaled $7.1 million for the 26 weeks ended June 30, 2006, as compared to $7.4 million for the 26 weeks ended
July 1, 2005, a decrease of $0.3 million. The decrease was a result of a reduction in the outstanding amount of the 91/2% Senior Notes due 2011 issued in May 2004.

Miscellaneous, net. Miscellaneous, net was $0.5 million for the
26 weeks ended June 30, 2006, as compared to $0.1 million for the 26 weeks ended July 1, 2005, an increase of $0.4 million. The increase was primarily due to the premium of $0.3 million paid to retire $4.0 million of the Companys
91/2% senior notes in May 2006.

Income Taxes. As a subchapter S corporation for United States tax purposes, the Company is generally not subject to United States federal and
state income taxation. Rather, the Companys income, gains, losses, deductions and credits flow through to its stockholders and the Company makes distributions to them to meet their tax obligations at an assumed maximum federal and state tax
rate (based on the state with the highest tax rate in which any of the Companys stockholders reside). This assumed rate was 40.4% for the 26 weeks ended June 30, 2006 and for the 26 weeks ended July 1, 2005. The Company pays foreign
income taxes on the earnings of its European subsidiaries.

Net Income. As a result of the aforementioned factors, net income
increased $0.7 million from $15.4 million for the 26 weeks ended July 1, 2005 to $16.1 million for the 26 weeks ended June 30, 2006.



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##### Table of Contents

Liquidity and Capital Resources

The Company expects to be able to fund its working capital requirements, interest expense, capital expenditures and its distributions to stockholders with cash generated from operations, although there can be no
assurances in this regard.

In May 2006, the Company repurchased $4.0 million of the outstanding principal amount of its 91/2% senior notes from the open market for an aggregate purchase price of $4.3 million. The Company retired these
notes and wrote-off the related deferred financing costs and incurred a charge of $0.4 million during the second quarter of 2006 relating to the repurchase. Depending on the Companys expected cash needs, the prevailing prices of its 91/2% senior notes and other factors, the Company may repurchase some amount of its outstanding 91/2% senior notes from time to time in the open market or otherwise.

Management believes the principal indicators of the Companys liquidity are its cash position, remaining availability under its bank credit
facilities and its excess working capital. At June 30, 2006, the Companys cash position was $6.6 million, a decrease of $5.9 million from December 30, 2005. The decrease was primarily due to the repurchase of $4.0 million of the
outstanding principal amount of its 91/2% senior notes. Additionally, the Company had an unsecured revolving
credit facility, with maximum possible borrowings equal to $10.0 million, which expires in April 2008. Interest on any outstanding borrowings related to this line of credit is calculated at the prime rate, which was 8.25% on June 30, 2006. At
June 30, 2006, the Company had no outstanding balances under this line of credit. Da-Lites working capital position decreased to $29.0 million (including $6.6 million of cash and cash equivalents) at June 30, 2006, from $31.3 million
(including $12.5 million of cash and cash equivalents) at December 30, 2005.

The Companys Dutch subsidiary, Projecta,
has an overdraft line of credit, with maximum possible borrowings equal to approximately 1.5 million Euros or certain percentages of Projectas eligible accounts receivable and inventory. This facility is secured by Projectas
accounts receivable and inventory. Interest on outstanding borrowings related to this line of credit is calculated at the Fortis Basic Rate plus 1.50%, the sum of which was 5.00% on June 30, 2006. At June 30, 2006, there were no borrowings
outstanding under this line of credit.

Cash Flows

For the first half of 2006, cash provided by operating activities was $16.2 million, as compared to $14.7 million during the first half of 2005, an increase of $1.5 million or 10.3%. Cash used in investing activities
was $1.5 million during the first half of 2006, as compared to $1.4 million during the first half of 2005, all of which in both periods represented capital expenditures. Cash used in financing activities was $20.8 million during the first half of
2006, as compared to $12.9 million during the first half of 2005.

Capital Expenditures

Capital expenditures were $1.5 million during the first half of 2006 compared to $1.4 million during the first half of 2005. The Companys management
currently expects to spend approximately $2.5 million on capital expenditures in 2006 using cash generated from operations.



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##### Table of Contents

Contractual Obligations

The following table sets forth, as of June 30, 2006, certain of the Companys contractual obligations:



|                                                |  |                        |       |                 |      |           |      |           |       |                  |  
|----------------------------------------------- |  | ---------------------- | ----- | --------------- | ---- | --------- | ---- | --------- | ----- | ---------------- | -
|                                                |  | Payments due by period
|Contractual Obligations                         |  | Total                  |       | Less than1 year |      | 1-3 years |      | 3-5 years |       | More than5 years
|                                                |  | (in millions)         
|Interest and principal payments for senior debt |  | $                      | 206.8 |                 | 13.3 |           | 26.6 |           | 166.9 |                  | 
|Self-insurance letter of credit                 |  |                        | 0.5   |                 | 0.5  |           |     |           |      |                  | 
|                                                |  |                        |       |                 |      |           |      |           |       |                  |  
|Total                                           |  | $                      | 207.3 |                 | 13.8 |           | 26.6 |           | 166.9 |                  | 
|                                                |  |                        |       |                 |      |           |      |           |       |                  |  

Distributions

As a subchapter S corporation under the Internal Revenue Code of 1986, Da-Lite is not subject to U.S. federal income taxes. Instead, such taxes are payable by Da-Lites stockholders. Distributions are made by
Da-Lite to its stockholders to pay estimated taxes relating to taxable income allocated to them by the Company on a quarterly basis. Tax related distributions were $7.2 million and $10.0 million in the second quarter of 2006 and the first half of
2006, respectively.

The Company has paid regular distributions to its stockholders in 2006 at the monthly rate of $200 per share or $1.1
million in the aggregate, subject to the covenants contained in the indenture related to its notes. Regular monthly distributions were paid to the Companys stockholders in 2005 at the monthly rate of $175 per share or $0.9 million in the
aggregate.

Inflation

The Company
manages its inflation risks by ongoing review of product selling prices and production costs. Management does not believe that inflation risks are material to the Companys business, its consolidated financial position, results of operations or
cash flows. However, there can be no assurance that future inflation will not have an adverse impact on the Companys operating results and financial condition.

Environmental

The Company has incurred, and in the future will continue to incur, expenditures for
matters relating to environmental control, remediation, monitoring and compliance. The Companys management believes that compliance with current environmental laws and regulations is not likely to have a material adverse effect on the
Companys financial condition, the results of its operations or its liquidity; however, environmental laws and regulations have changed rapidly in recent years and the Company may become subject to more stringent environmental laws and
regulations in the future.



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##### Table of Contents

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and
accounts receivable.

The Company maintains cash and cash equivalents with well-capitalized financial institutions.

The Companys sales are not materially dependent on a single customer or a small group of customers. No one individual customer balance represented
more than 5% of the Companys total outstanding receivables as of June 30, 2006. Credit risk associated with the Companys receivables is representative of the geographic, industry and customer diversity associated with the
Companys global business.

The Company also maintains credit controls for evaluating and granting customer credit. As a result, the
Company may require that customers provide some type of financial guarantee in certain circumstances.

Foreign Currency Risk

Da-Lite routinely uses forward exchange contracts to economically hedge raw material purchases from vendors outside of the country of purchase.

Interest Rate Risk

The Company has
two credit facilities available for general corporate purposes that are subject to variable interest rates. Interest related to any outstanding balances on the Companys $10.0 million revolving credit facility in the U.S. is calculated at the
prime rate, which was 8.25% on June 30, 2006. At June 30, 2006, the Company had no outstanding balances under this revolving credit facility. Interest on outstanding borrowings in Europe, related to Projectas overdraft line of
credit, is calculated at the Fortis Basic Rate plus 1.50%, the sum of which was 5.00% on June 30, 2006. At June 30, 2006, Projecta had no outstanding balances under this credit facility.

At June 30, 2006, the Company had $140.2 million in fixed-rate long-term debt outstanding. There are no earnings risks associated with the
Companys fixed rate debt. The fair market value of the fixed-rate debt (based on discounted cash flows reflecting borrowing rates currently available for debt with similar terms and maturities) varies with fluctuations in interest rates. A 10%
decrease in interest rates would have changed the fair market value of the fixed-rate debt to approximately $155 million from the fair value of approximately $149 million at June 30, 2006. Note that financial instruments are described as cash
or contractual obligations or rights to pay or receive cash. The fair value of all other financial instruments approximates the carrying value because of the short-term maturity of these instruments.



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##### Table of Contents

Item 4. Controls and Procedures.



|(a) | Evaluation of Disclosure Controls and Procedures. Based on the evaluation required by Rule 15d-15(e) under the Securities Exchange Act of 1934, the principal executive
officer and principal financial officer of the Company have concluded that the Companys disclosure controls and procedures (as defined in Rule 15d-15(e)), as of the end of the period covered by this report, were effective to ensure that the
information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. The
disclosure controls and procedures are designed to only provide reasonable assurance of achieving the desired control objections.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(b) | Changes in internal control over financial reporting. There were no changes in the Companys internal control over financial reporting that occurred during the last
fiscal quarter that has materially affected, or are reasonably likely to materially affect, the Companys internal control over financial reporting.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

PART II

OTHER INFORMATION

Item 1. Legal Proceedings

On May 19, 2006, Draper, Inc. (Draper), a competitor of the
Company, filed an action entitled Draper, Inc. v. Da-Lite Screen Company, Inc. and Stewart Filmscreen Corporation in the United States District Court for the Southern District of Indiana, Indianapolis Division. The complaint, as amended,
alleges that certain projection screens manufactured by the Company and Stewart Filmscreen Corporation, another competitor of the Company, infringe patents issued to Draper, and seeks unspecified damages and injunctive relief. The Company has filed
an answer denying the allegations and asserting several affirmative defenses. The Company believes that it has good defenses to this suit and intends to vigorously defend this action. The results of legal proceedings cannot be predicted with
certainty, and it is possible that a failure of the Company to prevail in this action could have a material adverse effect on its results of operations or financial condition.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

During the second quarter of 2006,
two employees exercised options to purchase an aggregate of 2.0 shares of our common stock at an aggregate purchase price of $24,418. These transactions were exempt from registration pursuant to, among other things, Section 4(2) of the
Securities Act of 1933, as amended, and Rule 701 thereunder. The Company repurchased 7.5 shares from stockholders during the same period.

Item 6. Exhibits



|            |  |                                                                                                                                
|----------- |  | -------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                    
|31.1        |  | Certification of CEO pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|            | 
|31.2        |  | Certification of CFO pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|            | 
|32.1        |  | Certification of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002  
|            | 
|32.2        |  | Certification of CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002  



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##### Table of Contents

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.



DA-LITE SCREEN COMPANY, INC.(Registrant)By:

/s/ Jerry C. YoungJerry C. YoungVice President  Finance and Chief Financial Officer (Principal Financial and Accounting Officer)


Date: August 9, 2006



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##### Table of Contents

EXHIBIT INDEX



|            |  |                                                                                                                                
|----------- |  | -------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                    
|31.1        |  | Certification of CEO pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|            | 
|31.2        |  | Certification of CFO pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|            | 
|32.1        |  | Certification of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002  
|            | 
|32.2        |  | Certification of CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002  



19