UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   Form 10-KSB
(Mark One)

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

            For the fiscal year ended May 31, 2006

      |_|   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934

            For the transition period from              to                .
                                          --------------  ----------------

                         Commission File Number 0-22735

                       ROBOCOM SYSTEMS INTERNATIONAL INC.
                 (Name of small business issuer in its charter)

             New York                                    11-2617048
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)

 17 Fairbanks Blvd., Woodbury, New York                      11797
(Address of principal executive offices)                  (Zip Code)

Issuer's telephone number: (516) 692-8394

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

Securities registered under Section 12(g) of the Exchange Act:

                          Common Stock, $.01 par value
                                (Title of Class)

Check whether the issuer is not required to file reports  pursuant to Section 13
or 15(d) of the Exchange Act. |_|

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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 |_|

Check  if no  disclosure  of  delinquent  filers  in  response  to  Item  405 of
Regulation S-B is contained in this form, and no disclosure is contained, to the
best  of  the  registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. |X|

State issuer's revenues for its most recent fiscal year. $1,327,547.

As of September 13, 2006,  the issuer had  outstanding  4,840,984  shares of its
common stock.

As of September  12, 2006,  the  aggregate  market value of the issuer's  common
stock held by  non-affiliates  was $515,290 (based upon the closing price of the
issuer's common stock on The Over-the-Counter Bulletin Board on such date).

Transitional Small Business Disclosure Format (check one) Yes |_| No |X|

<PAGE>
                                     Part I

Item 1. Description of Business.

General

      Robocom Systems  International  Inc. ("we," "us," "our," or "our company")
was  incorporated  under the laws of the State of New York in 1982.  Our company
was  organized  to develop,  market and support  advanced  warehouse  management
software solutions that enable companies to realize  significant cost savings by
automating  their  warehouse   operations  and  providing  inventory  visibility
throughout the supply chain. On October 11, 2005, we sold  substantially  all of
our  assets to Avantce  RSI,  LLC, a Delaware  limited  liability  company,  for
$2,970,000 in cash,  plus a $200,000  promissory note payable over two years. In
July  2006,  we  paid a  dividend  to our  shareholders  totaling  approximately
$2,760,000,  which  represented  approximately  87% of our total  assets at that
time.

      Since the asset  sale on  October  11,  2005,  we have not  engaged in any
operations  and our  business has been  dormant.  As such,  we may  presently be
defined as a "shell" company, whose sole purpose, at this time, is to locate and
consummate a merger with or an acquisition of a private entity.

      We will continue our filing with the Securities and Exchange Commission of
reporting  documentation and reports in an effort to maximize shareholder value.
We  believe  our  best  use and  primary  attraction,  as a  merger  partner  or
acquisition  vehicle,  will be our status as a  reporting  public  company.  Any
business  combination or  transaction  may  potentially  result in a significant
issuance of shares and substantial dilution to our present stockholders.

      The proposed business activities  described herein classify us as a "blank
check"  company.  Many  states  have  enacted  statutes,  rules and  regulations
limiting the sale of securities of "blank check"  companies in their  respective
jurisdictions.  Management  does not intend to  undertake  any  offering  of our
securities,  either  debt or  equity,  until  such time as we have  successfully
implemented our business plan described herein.

      At  this  time,  our  purpose  is  to  seek,   investigate  and,  if  such
investigation warrants,  acquire an interest in business opportunities presented
to us by persons or firms who or which desire to seek the  perceived  advantages
of a corporation  whose  securities  are  registered  pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange  Act"). We will not restrict our
search to any specific  business,  industry or geographical  location and we may
participate in a business venture of virtually any kind or nature.

      This discussion of our proposed  business is  purposefully  general and is
not meant to be restrictive of our virtually unlimited  discretion to search for
and enter into potential business opportunities.  Management anticipates that we
may be able to participate  in only one potential  business  venture  because we
have   nominal   assets  and   limited   financial   resources.   This  lack  of
diversification  should be  considered a  substantial  risk to our  shareholders
because  it will not  permit  us to offset  potential  losses  from one  venture
against gains from another.

      We may seek a  business  opportunity  with  entities  that  have  recently
commenced operations, or that wish to utilize the public marketplace in order to
raise  additional  capital in order to expand into new  products or markets,  to
develop a new  product  or  service,  or for other  corporate  purposes.  We may
acquire assets and establish wholly owned  subsidiaries in various businesses or
acquire existing businesses as subsidiaries.

      We  anticipate  that the selection of a business  opportunity  in which to
participate  will be  complex  and  extremely  risky.  Due to  general  economic
conditions,  rapid  technological  advances  being made in some  industries  and
shortages of available capital, our management believes there are numerous firms
seeking  the  perceived  benefits  of a publicly  registered  corporation.  Such
perceived  benefits may include  facilitating  or  improving  the terms on which
additional  equity  financing may be sought,  providing  liquidity for incentive
stock options or similar  benefits to key  employees,  and  providing  liquidity
(subject to restrictions  of applicable  statutes) for all  shareholders,  among
other  factors.  Available  business  opportunities  may occur in many different
industries and at various stages of development, all of which will make the task
of  comparative  investigation  and  analysis  of  such  business  opportunities
extremely difficult and complex.

<PAGE>

      We have had, and  anticipate  that we will continue to have,  little or no
capital  with which to provide  the owners of  business  opportunities  with any
significant cash or other assets.  However,  our management  believes we will be
able to offer owners of  acquisition  candidates  the  opportunity  to acquire a
controlling  ownership  interest  in  a   publicly-registered   company  without
incurring the cost and time required to conduct an initial public offering.  The
owners of the business  opportunities will, however, incur significant legal and
accounting  costs in  connection  with  acquisition  of a business  opportunity,
including the costs of preparing  Current Reports on Form 8-K, Annual Reports on
Form 10-KSB and other reports required to be filed under applicable  Federal and
state securities law, agreements and related reports and documents. The Exchange
Act specifically  requires that any merger or acquisition  candidate comply with
all applicable reporting requirements, which include providing audited financial
statements to be included within the numerous filings relevant to complying with
the Exchange Act. Our officers and directors have not conducted  market research
and are not aware of statistical data that would support the perceived  benefits
of a merger or acquisition transaction for the owners of a business opportunity.

      Our officers have no  experience  in managing a shell  company  similar to
ours and will  rely  upon  their  own  efforts  in  accomplishing  our  business
purposes.  Nevertheless,  we  anticipate  we will locate and make  contact  with
possible  target  businesses  primarily  through the efforts of our officers and
directors,  who will meet personally with existing management and key personnel,
visit and inspect material facilities,  assets,  products and services belonging
to such prospects,  and undertake such further reasonable  investigation as they
deem appropriate.  Management has a network of business contacts,  including our
outside lawyers and accountants, and believes that prospective target businesses
will be referred to us through this network.

      We also anticipate that prospective  target  businesses will be brought to
our attention from various other  non-affiliated  sources,  including securities
broker-dealers,  investment bankers,  venture  capitalists,  bankers,  and other
members of the financial community.  We have neither the present intention,  nor
does the present  potential  exist for us, to consummate a business  combination
with a target business in which our management or their affiliates or associates
directly or indirectly have a pecuniary interest, although no existing corporate
policies would prevent this from occurring.  Although there are no current plans
to do so, we may engage the services of  professional  firms that  specialize in
finding  business  acquisitions  and pay a finder's  fee or other  compensation.
Since we have no current plans to utilize any outside consultants or advisors to
assist in  creating  a  business  combination,  no  policies  have been  adopted
regarding the use of such advisors and consultants, the services to be provided,
the terms of service,  or  regarding  the total amount of fees that may be paid.
However,  because of our limited resources, it is likely that any such fee would
be paid in stock and not in cash.

      The analysis of new business opportunities will be undertaken by, or under
the  supervision  of, our  officers  and  directors.  In  analyzing  prospective
business  opportunities,  management will consider such matters as the available
technical,  financial  and  managerial  resources;  working  capital  and  other
financial requirements; history of operations, if any; prospects for the future;
nature of present  and  expected  competition;  the quality  and  experience  of
management services that may be available and the depth of that management;  the
potential  for further  research,  development  or  exploration;  specific  risk
factors  not now  foreseeable  but that then may be  anticipated  to impact  the
proposed activities of our company;  the potential for growth or expansion;  the
potential for profit;  the perceived  public  recognition  of, or acceptance of,
products,  services or trades; name identification;  and other relevant factors.
Our officers and directors  expect to meet  personally  with  management and key
personnel of the business  opportunity  as part of their  investigation.  To the
extent  possible,  we intend to utilize  written  reports and  investigation  to
evaluate  the above  factors.  We will not acquire or merge with any company for
which audited financial statements cannot be obtained within a reasonable period
of time after  closing of the proposed  transaction.  Our limited  funds and the
lack of full-time  management,  however,  will likely make it  impracticable  to
conduct  a  complete  and  exhaustive  investigation  and  analysis  of a target
business  before we commit our capital or other  resources  thereto.  Management
decisions,  therefore, will likely be made without detailed feasibility studies,
independent analysis, market surveys and the like which would be desirable if we
had more funds available.  We will be particularly dependent in making decisions
upon information  provided by the promoter,  owner, sponsor or others associated
with the business opportunity seeking our participation.

      We will not restrict our search to any specific  kind of firm,  but we may
acquire a venture that is in its  preliminary  or  development  stage,  which is
already in operation,  or in essentially  any stage of its corporate life. It is
impossible  to predict at this time the status of any  business  in which we may
become engaged, in that such business may need to seek additional  capital,  may
desire  to  have  its  shares  publicly  traded,  or may  seek  other  perceived


                                       2
<PAGE>

advantages which we may offer.  However, we do not intend to obtain funds in one
or more private  placements  to finance the  operation of any acquired  business
opportunity until such time as we have successfully consummated such a merger or
acquisition.

      It  is   anticipated   that  we  will  incur   nominal   expenses  in  the
implementation  of the business plan described  herein.  We have limited capital
with which to pay these anticipated expenses.

      The time and costs  required  to select  and  evaluate  a target  business
(including  conducting a due diligence  review) and to structure and  consummate
the  business  combination   (including   negotiating  relevant  agreements  and
preparing requisite documents for filing pursuant to applicable  securities laws
and state "blue sky" and corporation  laws) cannot presently be ascertained with
any degree of certainty.  Our officers and directors only devote a small portion
of their time to the operations of our company, and,  accordingly,  consummation
of a  business  combination  may  require a greater  period of time than if they
devoted  their full time to our  company's  affairs.  However,  our officers and
directors will devote such time as they deem reasonably needed.

      In implementing a structure for a particular business acquisition,  we may
become a party to a merger,  consolidation,  reorganization,  joint  venture  or
licensing  agreement with another corporation or entity. We may also acquire the
stock or assets of an existing business. Upon the consummation of a transaction,
it is probable that our present management and shareholders will no longer be in
control of our company. In addition,  our directors may, as part of the terms of
the acquisition  transaction,  resign and be replaced by new directors without a
vote of our current shareholders or may sell their stock in our company. Any and
all such sales will only be made in compliance  with the securities  laws of the
United States and any applicable state.

   It is anticipated that any securities issued in any such  reorganization will
be issued in reliance upon exemption from registration  under applicable federal
and state  securities  laws.  In some  circumstances,  however,  as a negotiated
element  of its  transaction,  we may  agree to  register  all or a part of such
securities  immediately  after the  transaction  is  consummated or at specified
times  thereafter.  If  such  registration  occurs,  of  which  there  can be no
assurance,  it  will  be  undertaken  by the  surviving  entity  after  we  have
successfully consummated a merger or acquisition and we are no longer considered
a "shell" company.  Until such time as this occurs, we do not intend to register
any additional securities. The issuance of substantial additional securities and
their  potential sale into any trading market that may develop in our securities
may have a depressive  effect on the value of our  securities in the future,  if
such a market develops, of which there is no assurance.

      As a general  rule,  federal  and state  tax laws and  regulations  have a
significant  impact  upon the  structuring  of  business  combinations.  We will
evaluate the possible tax consequences of any prospective  business  combination
and will endeavor to structure a business  combination so as to achieve the most
favorable  tax  treatment  for us,  the  target  company  and  their  respective
stockholders.  However,  there can be no  assurance  that the  Internal  Revenue
Service ("IRS") or relevant state tax authorities will ultimately  assent to our
tax treatment of a particular consummated business combination.

      To the extent the IRS or any  relevant  state tax  authorities  ultimately
prevail in recharacterizing the tax treatment of a business  combination,  there
may be adverse tax  consequences to us, the target business and their respective
stockholders.  Tax  considerations  as well as other  relevant  factors  will be
evaluated  in  determining  the  precise  structure  of  a  particular  business
combination,  which  could  be  effected  through  various  forms  of a  merger,
consolidation or stock or asset acquisition.

      While the actual terms of a transaction  to which we may be a party cannot
be predicted,  it may be expected  that the parties to the business  transaction
will find it  desirable  to avoid the  creation  of a taxable  event and thereby
structure  the  acquisition  in  a  so-called  "tax-free"  reorganization  under
Sections 368(a)(1) or 351 of the Internal Revenue Code (the "Code"). In order to
obtain tax-free  treatment under the Code, it may be necessary for the owners of
the  target  business  to own 80% or more of the voting  stock of the  surviving
entity. In such event, our shareholders would retain less than 20% of the issued
and  outstanding  shares  of  the  surviving  entity,   which  would  result  in
significant dilution in the equity of such shareholders.  Nonetheless, there can
be no assurance that the IRS or relevant state tax  authorities  will ultimately
assent to our tax treatment of a particular consummated business combination.


                                       3
<PAGE>

      With respect to any merger or  acquisition,  negotiations  with the target
company's  management is expected to focus on the percentage of our company that
the target  company  shareholders  would  acquire in  exchange  for all of their
shareholdings  in the target company.  Depending upon,  among other things,  the
target company's assets and liabilities, our shareholders will in all likelihood
hold a  substantially  lesser  percentage  ownership  interest  in  our  company
following any merger or acquisition.  The percentage ownership may be subject to
significant  reduction in the event we acquire a target company with substantial
assets.  Any merger or  acquisition  effected  by us can be  expected  to have a
significant  dilutive  effect  on the  percentage  of  shares  held by our  then
shareholders.

      We will  participate in a business  opportunity only after the negotiation
and  execution of  appropriate  written  agreements.  Although the terms of such
agreements  cannot be predicted,  generally  such  agreements  will require some
specific  representations  and  warranties by all of the parties  thereto,  will
specify  certain  events of  default,  will  detail the terms of closing and the
conditions  which must be  satisfied  by each of the parties  prior to and after
such  closing,  will  outline  the  manner of  bearing  costs,  including  costs
associated  with our  attorneys  and  accountants,  will set forth  remedies  on
default and will include miscellaneous other terms.

      As stated  hereinabove,  we will not acquire or merge with any entity that
cannot provide  independent  audited  financial  statements  within a reasonable
period of time after closing of the proposed transaction.  We are subject to all
of the reporting  requirements  included in the Exchange Act.  Included in these
requirements  is the  affirmative  duty to file  independent  audited  financial
statements  as part of our  Current  Report  on Form  8-K to be  filed  with the
Securities and Exchange Commission upon consummation of a merger or acquisition,
as well as the audited  financial  statements  included in our annual  report on
Form 10-KSB. If such audited financial  statements are not available at closing,
or  within  time  parameters   necessary  to  insure  our  compliance  with  the
requirements  of the  Exchange  Act,  or if  the  audited  financial  statements
provided  do not  conform to the  representations  made by the  candidate  to be
acquired in the closing  documents,  the closing documents will provide that the
proposed  transaction  will  be  voidable,  at the  discretion  of  our  present
management.

      We do not  intend  to  provide  our  security  holders  with any  complete
disclosure  documents,  including  audited financial  statements,  concerning an
acquisition or merger  candidate and its business prior to the  consummation  of
any acquisition or merger transaction.

      Our company will remain an insignificant  participant among the firms that
engage in the acquisition of business opportunities.  There are many established
venture capital and financial concerns that have significantly greater financial
and personnel  resources and  technical  expertise  than we have. In view of our
combined   extremely   limited  financial   resources  and  limited   management
availability,  we will continue to be at a significant competitive  disadvantage
compared to our competitors.

Employees

      As of September  13, 2006, we did not have any  employees,  other than our
executive officers.

Item 2. Description of Property.

      Our executive  office is located in Woodbury,  New York in the home office
of Irwin  Balaban,  our Chief  Executive  Officer  and  Chairman of our Board of
Directors.  The Company believes that its existing facilities are sufficient for
its current operations.

Item 3. Legal Proceedings.

      As we previously reported,  in June 2005, we were named as a Respondent in
an arbitration  commenced in London by Robocom UK Ltd. ("UK") under the UNCITRAL
arbitration  rules.  UK  alleged  that it was  terminated  without  cause by our
company as a non-exclusive distributor in the United Kingdom and Ireland, and it
sought in excess of (pound)200,000 in damages. We vigorously denied those claims
and asserted a series of limited counterclaims.  At the end of a two-day hearing
in London, the arbitrator dismissed all of UK's claims, granted a portion of our
counterclaim,  and  awarded  us  costs  in an  amount  to be  determined.  As of
September  13,  2006,  we are  preparing  to  submit  additional  papers  to the
arbitrator to establish the amount due.


                                       4
<PAGE>

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

      Our 2006 Annual Meeting of Shareholders was duly held on June 28, 2006. At
the meeting,  our  shareholders  (i) elected all four  director  nominees to the
Board  of  Directors,   (ii)   approved  the   amendments  to  our  Articles  of
Incorporation described below above and (iii) ratified the selection of Eisner &
Lubin LLP as our independent accountants for the fiscal year ended May 31, 2006.

      At the 2006 Annual  Meeting of  Shareholders,  our  shareholders  approved
amendments to our Articles of  Incorporation to (i) increase our total number of
authorized  shares  of common  stock to  125,000,000  shares,  (ii)  permit  our
shareholders  to act without a meeting by written consent of the holders of less
than all of the  outstanding  shares and (iii)  prescribe a majority vote of the
outstanding  shares  for  the  adoption  or  approval  of a plan  of  merger  or
consolidation,  the  sale,  lease,  exchange  or  other  disposition  of  all or
substantially  all of the  assets of our  company,  or a plan of  binding  share
exchanges.

      The  following  table sets forth the number of votes cast for,  against or
withheld as to each proposal, other than the election of directors.

<TABLE>
<CAPTION>
PROPOSAL                                                               FOR         AGAINST      WITHHELD
--------                                                               ---         -------      --------
<S>                                                                  <C>           <C>            <C>
Amendment to Articles increasing authorized shares:                  4,392,317     128,753        8,300

Amendment to Articles permitting action by written consent
of the holders of less than all of the outstanding shares:           3,518,031     113,416        1,300

Amendment to Articles prescribing majority vote as to certain
transactions:                                                        3,522,301     102,146        8,300

Ratification of independent accountants:                             4,491,824      36,246        1,300
</TABLE>


                                       5
<PAGE>

                                     Part II

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

      Our common stock trades on The  Over-the-Counter  Bulletin Board under the
symbol RIMS. The following table  represents the high and low price  information
for our common stock for each quarterly period in fiscal 2005 and 2006.

                                      Fiscal 2005          Fiscal 2006
                                      High        Low      High        Low
                                      ----        ---      ----        ---
         Quarter ended August 31     $0.82      $0.50     $0.89      $0.45
         Quarter ended November 30    0.92       0.57      0.68       0.55
         Quarter ended February 28    0.99       0.65      0.74       0.60
         Quarter ended May 31         0.93       0.63      0.75       0.70

      Quotations  listed  above  reflect  inter-dealer  prices,  without  retail
mark-up, mark-down or commission and may not represent actual transactions.

      On September  12, 2006,  the closing price of our common stock as reported
on the Over-the-Counter Bulletin Board was $0.26.

      As of September 13, 2006,  there were 4,840,984 shares of our common stock
outstanding held by  approximately  30 shareholders of record.  Of the 4,840,984
shares, 1,529,200 shares of common stock were held in street name.

      On July 28, 2006, we paid a dividend to our shareholders of record on July
14,  2006  totaling  approximately  $2,760,000,  or $0.57  per  share,  less any
applicable withholding tax.


                                       6
<PAGE>

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

      Certain statements in this Report constitute "forward-looking  statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors which may cause the actual results, performance or achievements of
our company to be materially  different from any future results,  performance or
achievements  expressed or implied by such forward-looking  statements.  Factors
that might cause such a difference include, among others, uncertainties relating
to  general  economic  and  business  conditions,  intense  competition  for the
acquisition of businesses, and domestic and foreign government regulations.  The
words  "believe,"  "expect,"  "anticipate,"  "intend"  and  "plan"  and  similar
expressions identify  forward-looking  statements.  Readers are cautioned not to
place undue reliance on these forward-looking statements, which speak only as of
the date the statement was made.

Overview

      Prior to the  sale of our  assets  on  October  11,  2005,  our  principal
activities included marketing and support of comprehensive  warehouse management
software systems.  We licensed our standard RIMS warehouse  management  systems;
provided related services  (including  customization and  modification,  project
management,  training and  implementation)  and  maintenance  support;  and sold
related third-party hardware products.

      Our total revenues were dependent upon a relatively  small number of large
sales. We had large contracts with two customers that contributed  significantly
to our revenues.  Revenues from our five largest  clients in each of fiscal 2005
and  2006  accounted  for   approximately   64%  and  62%  of  total   revenues,
respectively.

      Costs of revenues  represented the cost of software  modification,  system
implementation and other services,  hardware and maintenance  support.  Costs of
services and costs of maintenance  consisted primarily of labor costs for client
support, including personnel costs, and costs relating to subcontracted services
and overhead.  Cost of hardware consisted primarily of the cost of hardware sold
by us on behalf of other manufacturers.

      Amortization of software  development  costs consisted of the amortization
of costs of engineering personnel and related development expenses,  such as the
development of software  tools and  documentation,  capitalized  starting at the
point  technological  feasibility is demonstrated.  We capitalized  $805,602 and
$145,186 in fiscal 2005 and 2006, respectively,  for software development costs.
Research  and  development   costs  for  these  periods  were  not  significant.
Amortization of software  development costs decreased  primarily due to the sale
of our assets on October 11, 2005.

      Selling,  general  and  administrative  expenses  consisted  primarily  of
salaries  for  sales,   marketing,   administrative,   executive  and  financial
personnel,  commissions  paid to sales  personnel,  and travel  and  promotional
expenses.


                                       7
<PAGE>

Results of Operations:

      The  following  table  sets  forth,  for the  periods  indicated,  certain
statement of operations data:

<TABLE>
<CAPTION>
                         (In thousands, except share data)

                                                               Year ended May 31,
                                                           --------------------------
                                                               2005           2006
                                                               ----           ----
<S>                                                        <C>            <C>
Selling, general and administrative expenses ...........   $      (126)   $      (154)

Interest income, net ...................................             6             82
                                                           -----------    -----------
Loss from continuing operations before income taxes ....   $      (120)   $       (72)
                                                           -----------    -----------

Benefit of income taxes ................................            48             29
                                                           -----------    -----------
Loss from continuing operations ........................   $       (72)   $       (43)
                                                           -----------

Income from discontinued operations
   (net of income tax provision of $44 in 2005 and $9 in
    2006 ...............................................   $       575    $       274
Gain on sale of discontinued operations
   (net of $25 income tax provision) ...................            --            652
                                                           -----------    -----------
Net income from discontinued operations ................   $       575    $       926
                                                           -----------    -----------

Net income .............................................   $       503    $       883
                                                           ===========    ===========

Basic and diluted net income (loss) per share:
     Continuing operations, basic and diluted ..........   $     (0.01)   $     (0.01)
                                                           -----------    -----------

     Discontinued operations, basic and diluted ........   $      0.12    $      0.20
                                                           -----------    -----------

Net income per basic and diluted share .................   $      0.11    $      0.19
                                                           ===========    ===========

Weighted average shares outstanding:
   Basic ...............................................     4,525,080      4,547,011
                                                           ===========    ===========
   Diluted .............................................     4,673,412      4,639,749
                                                           ===========    ===========
</TABLE>


                                       8
<PAGE>

Comparison of Fiscal Years Ended May 31, 2005 and May 31, 2006

Continuing Operations

      Selling,  General  and  Administrative  Expenses.   Selling,  general  and
administrative   expenses   consisted  of  salaries  for  financial   personnel,
professional fees and insurances, as well as other miscellaneous  administrative
expenses.  Selling,  general and administrative expenses increased by $28,142 to
$153,994 for the year ended May 31,  2006,  as compared to $125,852 for the year
ended May 31, 2005. This increase was primarily due to increased  consulting and
professional  fees,  offset,  in part, by a decrease in salaries for general and
administrative personnel and other miscellaneous related expenses.

      Interest Income,  Net. Interest income increased by $74,292 to $81,498 for
the year ended May 31,  2006,  as  compared to $7,206 for the year ended May 31,
2005.  This  increase was  primarily  due to an increase in cash on hand and the
type of short-term  investments  held during the 2006 period.  Interest  expense
decreased by $ 1,018 to $66 for the 2006  period,  as compared to $1,084 for the
2005 period.  This  decrease was primarily due to the repayment of loans payable
to Baseboard Investments, LLC.

      Income  Taxes.  During the fiscal year ended May 31,  2006,  an income tax
benefit  of  $29,025  was  recorded  primarily  due to the loss from  continuing
operations.  During  the 2005  period,  an income tax  benefit  of  $47,892  was
recorded primarily due to the loss from continuing operations.

Discontinued Operations

      Each of the  following  items are  included  in Income  from  Discontinued
Operations on the Statement of Operations.

      The  Company  operated  under its  former  warehouse  management  software
business  for a period of 133 days  during the fiscal  year ended May 31,  2006,
prior to the closing on the sale of such business on October 11, 2005.

      Revenues.  Total  revenues  decreased by $2,240,866 to $1,327,547  for the
year ended May 31, 2006,  as compared to  $3,568,235  for the year ended May 31,
2005. Prior to the sale of its former warehouse  management software business on
October 11, 2005,  the Company's  revenues were derived from a relatively  small
number of sales of software licenses, implementation services and maintenance of
existing  customer sites.  Software  license fees,  service  revenues,  hardware
revenues and maintenance  revenues  decreased during the 2006 period as compared
to the 2005 period, due to the discontinuation of the Company's core business.

      Cost of  Revenues.  Total cost of  revenues  decreased  by  $1,147,519  to
$371,040 for the fiscal year ended May 31, 2006, as compared to  $1,518,559  for
the fiscal year ended May 31, 2005. As a percentage  of revenues,  total cost of
revenues  decreased  to  approximately  28% in the 2006  period as  compared  to
approximately 43% in the 2005 period.

      Amortization  of  Software  Development  Costs.  Amortization  of software
development  costs  decreased  by $549,907 to $208,252 for the fiscal year ended
May 31,  2006,  as compared to $758,159  for the fiscal year ended May 31, 2005.
This  decrease was primarily due to the  discontinuation  of the Company's  core
business.

      Selling,  General  and  Administrative  Expenses.   Selling,  general  and
administrative  expenses  consisted  of  salaries  for  sales,   administrative,
executive and financial personnel, commissions, travel and promotional expenses,
professional  fees and  insurances,  as well as other  administrative  expenses.
Selling,  general and administrative  expenses decreased by $207,773 to $465,282
for the fiscal year ended May 31,  2006,  as compared to $673,055 for the fiscal
year ended May 31, 2005. This decrease was primarily due to the  discontinuation
of the Company's core business.


                                       9
<PAGE>

      Income  Taxes.  During the year ended May 31, 2006, a provision for income
taxes of $8,614  was  recorded  based on income  from  discontinued  operations,
offset by a benefit of operating loss  carryforwards  that had  previously  been
reserved. An additional provision for income taxes of $24,541 was recorded based
on the gain on the sale of substantially all of our assets,  offset by a benefit
of operating loss  carryforwards  that had previously been reserved.  During the
year ended May 31,  2005,  a provision  for income taxes of $43,762 was recorded
based on income from discontinued  operations,  offset by a benefit of operating
loss carryforwards that had previously been reserved.

Liquidity and Capital Resources

      During  fiscal  2006,  we  funded  our  operations  and  met  our  capital
expenditure   requirements   from  cash  on  hand   derived  from  the  sale  of
substantially  all of our assets on October 11, 2005. As of May 31, 2006, we had
$3,130,625 in cash and cash equivalents.

      Net cash  provided by  operating  activities  was $996,092 and $301,441 in
fiscal 2005 and 2006, respectively.  Cash flows from operations decreased in the
2006 period primarily as a result of the asset sale on October 11, 2005.

      We expended $8,333 and $7,011 for the purchase of equipment in fiscal 2005
and 2006, respectively.  We capitalized $805,602 and $145,186 in fiscal 2005 and
2006, respectively, for software development costs.

      We believe that our existing cash and cash  equivalents will be sufficient
to fund our legal,  accounting  and reporting  requirements  as a  publicly-held
company over the next twelve months.

      Inflation and Seasonality

      We did not  believe  our former  operations  were  materially  affected by
inflation or seasonality.


                                       10
<PAGE>

Item 7. Financial Statements

                          INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                             Form 10-KSB
                                                                             Page Numbers
<S>                                                                               <C>
Report of Independent Registered Public Accounting Firm ....................      12

Balance Sheets as of May 31, 2005 and 2006 .................................      13

Statements of Operations for the years ended May 31, 2005 and 2006 .........      14

Statements of Shareholders' Equity for the years ended May 31, 2005 and 2006      15

Statements of Cash Flows for the years ended May 31, 2005 and 2006 .........      16

Notes to Financial Statements ..............................................      17
</TABLE>


                                       11
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders
  Robocom Systems International Inc.

We have audited the accompanying balance sheets of Robocom Systems International
Inc. as at May 31, 2006,  and 2005,  and the related  statements of  operations,
shareholders'  equity  and cash  flows for each of the two  years in the  period
ended May 31, 2006.  These financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements  are free of material  misstatement.  The Company is not  required to
have,  nor were we engaged to perform,  an audit of its  internal  control  over
financial reporting.  Our audit included  consideration of internal control over
financial  reporting  as  a  basis  for  designing  audit  procedures  that  are
appropriate  in the  circumstances,  but not for the  purpose of  expressing  an
opinion on the  effectiveness  of the Company's  internal control over financial
reporting. Accordingly, we express no such opinion. An audit includes examining,
on a  test  basis,  evidence  supporting  the  amounts  and  disclosures  in the
financial statements. An audit also includes assessing the accounting principles
used and  significant  estimates made by  management,  as well as evaluating the
overall financial statement  presentation.  We believe that our audits provide a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of Robocom Systems  International
Inc. as at May 31, 2006 and 2005,  and the  results of its  operations,  and its
cash  flows  for  each of the two  years in the  period  ended  May 31,  2006 in
conformity with accounting principles generally accepted in the United States.


                                         /s/ Eisner & Lubin LLP
                                         ----------------------

New York, New York
   September 13, 2006.


                                       12
<PAGE>

                       ROBOCOM SYSTEMS INTERNATIONAL INC.

                                 BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                               2005               2006
                                                                           ------------       ------------
<S>                                                                        <C>                <C>
Assets
Current assets:
     Cash and cash equivalents ......................................      $    662,735       $  3,130,625
     Accounts receivable, less allowance for doubtful accounts of
        $5,800 in 2005 and $7,194 in 2006 ...........................           505,804                 --
     Unbilled revenue ...............................................           155,624                 --
     Deferred taxes .................................................            39,800                 --
     Due from Avantce ...............................................                --            192,000
     Other current assets ...........................................           119,910              1,583
                                                                           ------------       ------------
Total current assets ................................................         1,483,873          3,324,208

Property and equipment, less depreciation of $30,832 in 2005 ........            19,253                 --
Capitalized software, net ...........................................         1,623,675                 --
                                                                           ------------       ------------
Total assets ........................................................      $  3,126,801       $  3,324,208
                                                                           ============       ============

Liabilities and Shareholders' Equity
Current liabilities:
     Accounts payable ...............................................      $    111,032       $        481
     Accrued expenses ...............................................           162,917             75,000
     Deferred revenue ...............................................           501,110                 --
                                                                           ------------       ------------
Total current liabilities ...........................................           775,059             75,481
                                                                           ------------       ------------

Deferred tax liabilities ............................................            35,670                 --
                                                                           ------------       ------------
Total liabilities ...................................................           810,729             75,481
                                                                           ------------       ------------

Shareholders' equity:
     Preferred stock, $.01 par value; 1,000,000 shares authorized;
        None issued .................................................                --                 --
     Common stock, $.01 par value; 10,000,000 shares authorized;
       4,540,984 and 4,640,984 issued and outstanding at May 31, 2005
       and 2006, respectively .......................................            45,410             46,410
     Warrants: 100,000 outstanding at May 31, 2005 ..................           166,728                 --
     Additional paid-in capital .....................................        11,835,846         12,051,574
     Accumulated deficit ............................................        (9,731,912)        (8,849,257)
                                                                           ------------       ------------
Total shareholders' equity ..........................................         2,316,072          3,248,727
                                                                           ------------       ------------
Total liabilities and shareholders' equity ..........................      $  3,126,801       $  3,324,208
                                                                           ============       ============
</TABLE>

See accompanying notes.

                                       13
<PAGE>

                       ROBOCOM SYSTEMS INTERNATIONAL INC.

                            STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                              For the year ended May 31,
                                                            -----------------------------
                                                                2005              2006
                                                            -----------       -----------
<S>                                                         <C>               <C>
Selling, general and administrative expenses .........      $  (125,852)      $  (153,994)

Interest income, net .................................            6,122            81,432
                                                            -----------       -----------
Loss from continuing operations before income taxes ..         (119,730)          (72,562)

Benefit of income taxes ..............................           47,892            29,025
                                                            -----------       -----------
Loss from continuing operations ......................          (71,838)          (43,537)
                                                            -----------       -----------

Income from discontinued operations
   (net of income tax provision of $43,762 in 2005 and
   $8,614 in 2006) ...................................          574,700           274,359
Gain on sale of discontinued operations
   (net of $24,541 income tax provision) .............               --           651,833
                                                            -----------       -----------
Net income from discontinued operations ..............          574,700           926,192
                                                            -----------       -----------

Net income ...........................................      $   502,862       $   882,655
                                                            ===========       ===========

Basic and diluted net income (loss) per share:
     Continuing operations, basic and diluted ........      $     (0.01)      $     (0.01)
                                                            -----------       -----------

     Discontinued operations, basic and diluted ......      $      0.12       $      0.20
                                                            -----------       -----------

Net income per basic and diluted
     share ...........................................      $      0.11       $      0.19
                                                            ===========       ===========

Weighted average shares outstanding:
   Basic .............................................        4,525,080         4,547,011
                                                            ===========       ===========
   Diluted ...........................................        4,673,412         4,639,749
                                                            ===========       ===========
</TABLE>

See accompanying notes.

                                       14
<PAGE>

                       ROBOCOM SYSTEMS INTERNATIONAL INC.

                       STATEMENTS OF SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                     Common Stock
                            --------------------------------

                                        Par Value                Additional                         Total
                                          $.01                     Paid-In       Accumulated     Shareholders'
                             Shares                 Warrants       Capital          Deficit         Equity
                            ----------------------------------------------------------------------------------
<S>                         <C>          <C>        <C>           <C>            <C>              <C>
Balance, June 1, 2004 ..    4,495,984    $44,960    $ 166,728     $11,832,246    $(10,234,774)    $1,809,160

Net income .............           --         --           --              --         502,862        502,862

Stock option exercise ..       45,000        450           --           3,600              --          4,050
                            ----------------------------------------------------------------------------------

Balance, May 31, 2005 ..    4,540,984    $45,410    $ 166,728     $11,835,846    $ (9,731,912)    $2,316,072

Net income .............           --         --           --              --         882,655        882,655

Warrant exercise .......      100,000      1,000     (166,728)        215,728              --         50,000
                            ----------------------------------------------------------------------------------

Balance, May 31, 2006 ..    4,640,984    $46,410    $      --     $12,051,574    $ (8,849,257)    $3,248,727
                            ==================================================================================
</TABLE>

See accompanying notes.


                                       15
<PAGE>

                       ROBOCOM SYSTEMS INTERNATIONAL INC.

                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                          For the year ended May 31,
                                                         ---------------------------
                                                            2005            2006
                                                         -----------     -----------
<S>                                                      <C>             <C>
Operating activities
Net income ..........................................    $   502,862     $   882,655
Adjustments to reconcile net income to net
   cash provided by operating activities:
       Depreciation of property and equipment .......         13,662           5,298
       Amortization of software development costs ...        758,160         208,252
       Provision for bad debts ......................          5,800           1,394
       Deferred income taxes ........................         (4,130)          4,130
       Gain on the sale of assets ...................             --        (676,374)
       Changes in operating assets and liabilities,
       net of effects of disposition of net assets:
         Accounts receivable ........................            385         (12,926)
         Unbilled revenue ...........................       (103,870)       (186,029)
         Other current assets .......................         29,545         (17,075)
         Accounts payable ...........................         40,225         (78,434)
         Accrued expenses ...........................        (73,855)          9,029
         Deferred revenue ...........................       (172,692)        161,521
                                                         -----------     -----------
Net cash provided by operating activities ...........        996,092         301,441
                                                         -----------     -----------

Investing activities
Software development costs ..........................       (805,602)       (145,186)
Proceeds from sale of assets, net of related expenses             --       2,268,646
Capital expenditures ................................         (8,333)         (7,011)
                                                         -----------     -----------
Net cash provided by (used in) investing activities .       (813,935)      2,116,449
                                                         -----------     -----------

Financing activities
Loan payable to shareholders ........................        (56,644)             --
Proceeds from warrant exercise ......................             --          50,000
Proceeds from stock option exercise .................          4,050              --
                                                         -----------     -----------
Net cash provided by (used in) financing activities .        (52,594)         50,000
                                                         -----------     -----------

Increase in cash and cash equivalents ...............        129,563       2,467,890
Cash and cash equivalents at beginning of year ......        533,172         662,735
                                                         -----------     -----------
Cash and cash equivalents at end of year ............    $   662,735     $ 3,130,625
                                                         ===========     ===========

Supplemental disclosures of cash flow information:
  Cash paid for interest ............................    $    41,315     $     4,725
                                                         ===========     ===========
</TABLE>

Non-cash investing activity:

   Proceeds from sale of assets do not include a.) $523,131 received for the
   sale of cash and b.) $200,000 receivable under a promissory note.

See accompanying notes.


                                       16
<PAGE>

                       Robocom Systems International Inc.
                        Notes to the Financial Statements

1. Organization and Significant Accounting Policies

Organization

   Robocom Systems  International Inc. ("we," "us," "our," or "our company") was
incorporated in June 1982 in the State of New York.  Prior to the sale of assets
on October  11,  2005,  we were  engaged in the  development  and  marketing  of
automated  warehouse  management systems and related software,  which is used by
various commercial enterprises located in the United States and abroad.

      On October 11, 2005,  we sold  substantially  all of our assets to Avantce
RSI, LLC, a Delaware limited liability  company,  for $2,970,000 in cash, plus a
$200,000  promissory  note payable over two years.  On July 28, 2006,  we paid a
dividend  to  our  shareholders   totaling   approximately   $2,760,000,   which
represented approximately 87% of our total assets at that time.

      Since the asset  sale on  October  11,  2005,  we have not  engaged in any
operations and the business has been dormant. As such, our company may presently
be defined as a "shell" company,  whose sole purpose, at this time, is to locate
and consummate a merger with or an acquisition of a private entity.

Significant Accounting Policies

   Use of Estimates

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

   Revenue Recognition

   Prior to the sale of assets on October 11, 2005,  our  revenues  were derived
from software license fees, fees for services, sales of hardware and maintenance
contracts.  Software  license fees  included  revenue from the  licensing of our
proprietary   RIMS  software  and  revenue  from  the  sublicensing  of  certain
third-party  software.  Software  license  fee  revenue  was  recorded  when the
software was delivered,  the license agreement with the client was executed, and
collection of the resulting  receivable was deemed  probable.  Service  revenues
were  derived   from  project   management,   training,   on-site   support  and
implementation  services,  and,  to a  lesser  extent,  from  customization  and
modification  of  licensed  software.  The  majority  of service  revenues  were
recorded when the service was performed. Service revenues for project management
and  modifications  were recorded  using the  percentage  of completion  method.
Hardware revenues were derived from the sale of products of other manufacturers,
including computer hardware,  radio frequency  equipment,  bar code printers and
other  peripherals.  Such revenues were  recognized  when title to such hardware
passed to the  client.  Clients  typically  entered  into  one-year  maintenance
agreements  upon the utilization of RIMS and paid  maintenance  fees annually or
monthly in  advance.  We  recognized  revenue  from each  maintenance  agreement
ratably  over the period  covered by the  agreement,  but were only  required to
perform  maintenance  services  as  and  when  the  client  requested  them.  We
recognized revenues,  in all periods presented,  in accordance with the American
Institute of Certified  Public  Accountants  Statement of Position ("SOP") 97-2,
"Software  Revenue  Recognition,"  and  SOP  98-9,  "Modification  of SOP  97-2,
Software  Revenue  Recognition  with  Respect  to Certain  Transactions,"  which
amended  paragraphs  11 and 12 of SOP 97-2,  to require  recognition  of revenue
using the residual method under certain circumstances.


                                       17
<PAGE>

                       Robocom Systems International Inc.
                  Notes to the Financial Statements (continued)

Software Development Costs

   Prior to the sale of assets on October 11, 2005,  software  development costs
were capitalized in accordance with Statement of Financial  Accounting Standards
("SFAS")  No. 86,  "Accounting  for the Costs of  Computer  Software to be Sold,
Leased, or Otherwise  Marketed." The  capitalization of these costs began when a
product's  technological  feasibility had been  established,  and ended when the
product was  available  for general  release to clients.  The  establishment  of
technological  feasibility  and the  ongoing  assessment  of  recoverability  of
capitalized  software  development  costs  required   considerable  judgment  by
management with respect to certain external factors,  including, but not limited
to,  technological  feasibility,  anticipated  future gross revenues,  estimated
economic  life,  and changes in software  and  hardware  technologies.  Software
development costs,  including  enhancements,  were amortized to cost of revenue,
using the  straight-line  method  over three years or the  expected  life of the
product,  whichever was less.  Research and development  costs incurred prior to
the establishment of technological  feasibility were expensed as incurred;  such
amounts for the periods presented were not significant.

   Cash and Cash Equivalents

   We consider all highly liquid investments, with a maturity of three months or
less at the time of purchase, to be cash equivalents.

   Accounts Receivable

   Prior to the sale of assets on October 11, 2005,  trade  accounts  receivable
were  stated at the amounts  management  expected  to collect  from  outstanding
balances.  Management  provided for  probable  uncollectible  amounts  through a
charge to earnings and a credit to a valuation allowance based on its assessment
of  the  current  status  of  individual  accounts.  Balances  that  were  still
outstanding after management had used reasonable collection efforts were written
off through a charge to the valuation  allowance and a credit to trade  accounts
receivable.  Changes  in  the  valuation  allowance  were  not  material  to the
financial statements.

   Property and Equipment

   Prior to the asset sale on October 11, 2005, property and equipment consisted
of computers and other office  equipment.  We depreciated  the cost of computers
and other office  equipment  using the  straight-line  method over the estimated
useful lives (three years).

   Basic and Diluted Net Income Per Share

   Basic and diluted net income per share is computed by dividing  net income by
the  weighted  average  number of shares of  common  stock  outstanding  for the
periods presented.

   Stock Options

   SFAS No. 123, "Accounting for Stock-Based Compensation," defines a fair value
method  of  accounting  for the  issuance  of stock  options  and  other  equity
instruments.  Under the fair value method,  compensation cost is measured at the
grant  date  based on the fair  value of the  award and is  recognized  over the
service period,  which is usually the vesting period.  Pursuant to SFAS No. 123,
companies are encouraged,  but are not required,  to adopt the fair value method
of  accounting  for  employee  stock-based  transactions.   Companies  are  also
permitted  to  continue  to  account  for  such  transactions  under  Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees," but
are required to disclose in the  financial  statement  footnotes,  pro forma net
income and per share  amounts as if we had applied the new method of  accounting
for all grants made since 1997. SFAS No. 123 also requires increased disclosures
for stock-based  compensation  arrangements.  Our company adopted the disclosure
requirements of SFAS No. 123.


                                       18
<PAGE>

                       Robocom Systems International Inc.
                  Notes to the Financial Statements (continued)

   In December 2004, the Financial Accounting Standards Board published SFAS No.
123 (Revised),  "Share-based  Payment" ("SFAS 123R"). Under SFAS 123R, all forms
of share-based payments to employees, including employee stock options, would be
treated as  compensation  and recognized in the income  statement.  SFAS 123R is
effective  beginning  the fourth  quarter of fiscal 2006.  We do not believe the
adoption  of  SFAS  123R  will  have  a  significant  effect  on  our  financial
statements.

   Income Taxes

   Our company  provides  for income taxes under SFAS No. 109,  "Accounting  for
Income  Taxes," which employs an asset and liability  approach in accounting for
income taxes payable or refundable at the date of the financial  statements as a
result of all events that have been  recognized in the financial  statements and
as measured by the provisions of enacted laws.

   Deferred tax assets or liabilities  are recognized for temporary  differences
that will result in deductible amounts or taxable income in future years and for
net  operating  loss  carryforwards.  If it is more  likely  than not that some
portion  or all of a  deferred  tax  asset  will not be  realized,  a  valuation
allowance is recognized.

   Advertising Costs

   Advertising costs are expensed as incurred.  For the years ended May 31, 2005
and  2006,   these  costs   amounted  to   approximately   $34,000  and  $8,000,
respectively.

   Segment Information

   Prior to the sale of assets on October 11, 2005,  we operated in one business
segment,  as  defined  by  SFAS  No.  131,  "Disclosures  about  Segments  of an
Enterprise and Related Information."

   Our  revenues,  included  in discoutinued  operations,  by geographic markets
are summarized below:

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

               Domestic .............    $3,235,163    $1,316,796
               Europe ...............       192,682         4,001
               Pacific ..............        61,300            --
               Other ................        79,090         6,750
                                         ----------    ----------
                                         $3,568,235    $1,327,547
                                         ==========    ==========

   Concentration of Credit Risk

   Prior  to the sale of  assets  on  October  11,  2005,  our  client  base was
comprised of large  clients in  diversified  industries.  Revenues from our five
largest clients in fiscal 2005 and 2006 accounted for  approximately 64% and 62%
of total revenues, respectively.

   We  maintain  our cash  principally  at one  commercial  bank.  Cash and cash
equivalents  at May 31,  2006  includes a U.S.  Treasury  bill of  approximately
$2,905,000.



                                       19
<PAGE>

                       Robocom Systems International Inc.
                  Notes to the Financial Statements (continued)

2. Shareholders' Equity

   Warrants

   On May 27, 2003, we issued warrants to purchase  100,000 shares of our common
stock at an  exercise  price of $0.50  per  share to  Robocom  Properties,  Inc.
("Properties"),  in return for the  release of  long-term  debt in the amount of
$161,872 and the related interest of $4,856 owed to Properties under a long-term
debt  agreement  dated  May  30,  2002.  On May 9,  2006,  these  warrants  were
exercised. The shareholders of Properties are also shareholders of our company.

   Stock Option Plan

   We have a  Stock  Option  and  Long-term  Incentive  Compensation  Plan  (the
"Plan"), which, as amended,  provides for the issuance of up to 1,150,000 shares
of our common stock. Outstanding options were granted at an exercise price equal
to or in excess of the prevailing  market price on the grant date. These options
contain a vesting  schedule  determined  at the date of grant.  Incentive  stock
options are granted to employees.  All other options  granted,  including  those
granted to directors and consultants, are nonqualified options.

   The following summarizes stock option activity during fiscal 2005 and 2006:

                                                       Weighted-
                                         Shares         Average
                                          under        Exercise
                                         Option          Price
                                        ---------     -----------
               Balance, June 1, 2004      519,000         $0.71
               Granted                    230,000         $0.58
               Cancelled                  (34,000)        $2.63
               Exercised                  (45,000)        $0.09
                                        ---------     ---------
               Balance, May 31, 2005      670,000         $0.61
               Cancelled                 (210,000)        $0.60
                                        ---------     ---------
               Balance, May 31, 2006      460,000         $0.62
                                        =========     =========

   The  options   exercisable  at  2005  and  2006  were  590,000  and  460,000,
respectively.  The weighted average exercise price of options exercisable at May
31, 2005 and 2006 was $0.61 and $0.62, respectively.

   The weighted-average  fair value of options granted during the year ended May
31, 2005 was $0.58 per share. No options were granted during fiscal 2006.


                                       20
<PAGE>

                       Robocom Systems International Inc.
                  Notes to the Financial Statements (continued)

   The following table summarizes information about this plan at May 31, 2006:

                      Options                                Options
                    Outstanding          Weighted          Exercisable
                    -----------           Average          -----------
     Exercise                            Remaining
      Prices           Shares         Contractual Life       Shares
      ------           ------         ----------------       ------

      $0.570          200,000             3.4 years            200,000
      $0.650          260,000             2.6 years            260,000
                   ----------                              -----------
                      460,000                                  460,000
                   ==========                              ===========

   Pro forma  information  regarding  net  income  and net  income  per share is
required by SFAS No. 123, which also requires that the information be determined
as if we had accounted for our employee stock option grants under the fair value
method  required by SFAS No. 123.  The fair value of each option  grant has been
estimated as of the date of grant using the  Black-Scholes  option pricing model
with the following assumptions:

                                                     For the year ended May 31,
                                                                2005
                                                                ----
     Expected life..............................               5 years
     Interest rate..............................               1.63%
     Volatility.................................               1.80
     Dividend yield.............................               0%

   If we had recognized  compensation cost for stock-based employee compensation
in accordance with SFAS No. 123, our net income for the years ended May 31, 2005
and 2006 would have been as follows:

                                                     For the year ended May 31,
                                                         2005           2006
                                                         ----           ----
Pro forma net income:
    As reported .................................       $502,862       $882,655
    Pro forma in accordance with SFAS No. 123 ...       $344,657       $882,655
Pro forma basic and diluted net income per share:
    As reported .................................           $.11           $.19
    Pro forma in accordance with SFAS No. 123 ...           $.08           $.19

   The  compensation  expense and pro forma net income may not be  indicative of
amounts to be included in future periods.

   The  remaining  number of shares  reserved  for  options at May 31,  2006 was
645,000.


                                       21
<PAGE>

                       Robocom Systems International Inc.
                  Notes to the Financial Statements (continued)

3. Detail of Certain Balance Sheet Accounts

   Software Development Costs, net

   Software development costs, net, consisted of the following:

                                               For the year ended May 31,
                                                    2005         2006
                                                    ----         ----

         Software development costs ........     $3,818,773     $   --
         Less accumulated amortization .....     (2,195,098)    $   --
                                                 ----------     ------
                                                 $1,623,675     $   --
                                                 ==========     ======

   We transferred  our primary  product,  RIMS, to Avantce RSI, LLC in the asset
sale on October 11, 2005.

   Accrued Expenses

   Accrued expenses consisted of the following:

                                                For the year ended May 31,
                                                     2005       2006
                                                     ----       ----

         Payroll and related taxes .........        $93,701     $   --
         Accrued hardware costs ............         32,019         --
         Accrued interest ..................             --         --
         Professional fees and other .......         37,197     75,000
                                                   --------    -------
                                                   $162,917    $75,000
                                                   ========    =======

4. Employee Benefit Plan

   Prior  to the  asset  sale on  October  11,  2005,  we had a  401(k)  defined
contribution  plan.  This plan covered all employees  subject to certain service
requirements.  Under  the  terms  of  the  401(k)  plan,  we  matched  50% of an
employee's contribution up to 6% of the participating  employee's  compensation.
Plan  expenses  for each of the years  ended May 31,  2005 and 2006  amounted to
$46,000 and $16,000, respectively.


                                       22
<PAGE>

                       Robocom Systems International Inc.
                  Notes to the Financial Statements (continued)

5. Income Taxes

Significant  components of our deferred tax assets and liabilities as of May 31,
2005 and 2006 were as follows:

                                              For the year ended May 31,
                                                  2005          2006
                                                  ----          ----
        Deferred tax assets:
           Accrued expenses ...............    $   37,480    $       --
           Allowance for doubtful accounts          2,320         2,878
           Net operating loss carryforwards     2,854,148     1,888,539
                                               ----------    ----------
        Total deferred tax assets .........     2,893,948     1,891,417
        Valuation allowance ...............     2,240,348     1,891,417
                                               ----------    ----------
        Net deferred tax assets ...........       653,600            --
        Deferred tax liabilities: .........                          --
            Software development costs ....       649,470            --
                                               ----------    ----------
        Net deferred tax assets ...........    $    4,130    $       --
                                               ==========    ==========

   The  valuation  allowance  at May 31, 2005 and 2006 was  provided  because of
uncertainty,  based on our  historical  results,  with respect to realization of
deferred tax assets.  The valuation  allowance  decreased during the years ended
May 31, 2005 and 2006 by $199,261 and $348,931, respectively.

   We recognized an income tax benefit on our loss from  continuing  operations;
such benefit was available due to our income from  discontinued  operations  and
gain  on sale of  discontinued  operations.

   At May 31, 2006, we had net operating  loss  carryforwards  of  approximately
$4.7 million for income tax purposes, which may be able to reduce taxable income
in future years.  The  utilization of these losses to reduce future income taxes
will  depend  on the  generation  of  sufficient  taxable  income  prior  to the
expiration  of  the  net  operating  loss  carryforwards.   Net  operating  loss
carryforwards will expire in various years through May 31, 2022.

   For the nine months ended  February 28, 2005 and 2006,  we reported an income
tax benefit of $190,709 and  $405,578,  respectively,  in computing our net loss
from  continuing  operations.  The amounts  reported for the years ended May 31,
2005 and 2006 include a reclassification of $159,640 and $387,304, respectively,
of such amounts from continuing operations to discontinued operations.

6. Related Party Transactions

   Prior to the  asset  sale on  October  11,  2005,  we  leased  our  principal
facilities from Properties. The shareholders of Properties are also shareholders
of our company.  In connection  therewith,  we incurred expenses of $168,000 and
$56,000 in the fiscal years ending 2005 and 2006, respectively.

   As of May 30,  2002,  we converted  debt  incurred  under a prior  consulting
agreement  with the  chairman  of the board  and  principal  shareholder  of our
company to a promissory  note,  bearing interest at 3% per annum and maturing on
May 30, 2004.  As of May 30, 2003,  this note was extended  until June 30, 2005,
under the existing terms. All amounts were repaid during fiscal 2006.

   As of May 30,  2002,  we converted  debt  incurred  under a prior  consulting
agreement  with  a  director  and  principal  shareholder  of our  company  to a
promissory note,  bearing interest at 3% per annum and maturing on May 30, 2004.
As of May 30,  2003,  this note was  extended  until  June 30,  2005,  under the
existing terms. All amounts were repaid during fiscal 2006.


                                       23
<PAGE>

                       Robocom Systems International Inc.
                  Notes to the Financial Statements (continued)

7. Lease Commitments

      We are not currently obligated under any lease.

8. Subsequent Events

      On June 28,  2006,  our  shareholders  approved  an  increase in our total
number of authorized shares to 125,000,000.

      On July 13,  2006,  200,000  shares of our common stock were issued to the
directors in connection with stock option exercises.

      On July 28, 2006, we paid a dividend to our shareholders of record on July
14,  2006  totaling  approximately  $2,760,000,  or $0.57  per  share,  less any
applicable  withholding tax. This dividend represented  approximately 87% of the
total assets of our company.

9. Gain Contingency

      In an arbitration case with a former distributor, we were awarded costs in
an amount to be determined.  We expect that any award would not exceed $150,000.
Due to the  uncertainty  of both the amount and its  collectibility,  no amounts
have been recognized in the financial statements.


                                       24
<PAGE>

Item 8A. Controls and Procedures

      (a)   As of the end of the period  covered by this report,  we carried out
            an evaluation,  under the supervision and with the  participation of
            our management,  including our Chief Executive Officer and principal
            accounting officer, of the effectiveness of the design and operation
            of the disclosure  controls and  procedures  pursuant to Rule 13a-15
            under the Securities Exchange Act of 1934, as amended (the "Exchange
            Act").  Based upon the evaluation,  our Chief Executive  Officer and
            principal  accounting  officer  concluded that, as of the end of the
            period,  the disclosure  controls and  procedures  were effective in
            timely alerting him to material  information relating to our company
            required to be included in the reports that are filed and  submitted
            pursuant to the Exchange Act.

      (b)   During our fourth fiscal  quarter of 2006,  there were no changes in
            our internal controls over financial  reporting that have materially
            affected,  or  are  reasonably  likely  to  materially  affect,  the
            internal controls over financial reporting.


                                       25
<PAGE>

                                    Part III

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

Directors and Executive Officers

      The executive officers and directors of our company are as follows:

<TABLE>
<CAPTION>
         Name             Age                               Position
         ----             ---                               --------
<S>                       <C>      <C>
Irwin Balaban             74       Chairman of the Board, President and Chief Executive Officer

Robert B. Friedman        67                                 Director

Herbert Goldman           75                                 Director

Lawrence B. Klein         72                                 Director
</TABLE>

      Irwin Balaban, a co-founder of our company, has been Chairman of the Board
since 1983.  From 1983 until his  retirement in March 1999, he was President and
Chief Executive Officer of our company.  Since March 1999, he had been providing
consulting  services to us. In his capacity as a consultant,  in July 2001,  Mr.
Balaban assumed the offices of President and Chief Executive Officer.

      Robert B. Friedman has been a director since March 2003.  Mr.  Friedman is
currently the principal owner and managing partner of several business ventures,
including the Norwich (CT) Comfort Suites Hotel,  the Norwich (CT)  Navigators -
Class AA affiliate of the San Francisco Giants, the Nathan Hale Inn & Conference
Center at the  University of  Connecticut  and the  Middletown  Inn & Conference
Center. From 1969 to 1989, Mr. Friedman, a graduate of The Wharton School of the
University  of PA,  was  President  and a  Director  of the  Middex  Development
Corporation,  a  national  real  estate  development  company,  involved  in the
development, ownership and management of hotels and office buildings.

      Herbert  Goldman,  a co-founder of our company,  has been a director since
1983. He provided  consulting  services to us from his  retirement in 1996 until
May 2000.  From 1991 until his  retirement,  Mr. Goldman had been Executive Vice
President - Operations.

      Lawrence B. Klein, a co-founder of our company,  has been a director since
1991.  He was  Executive  Vice  President  -  Worldwide  from May 1999 until his
retirement  in May  2000,  and from May 2000 to May  2001,  provided  consulting
services  to us.  From  1991 to May  1999,  Mr.  Klein  was the  Executive  Vice
President, Marketing and Sales.

      All directors  hold office until the next annual  meeting of  shareholders
and until  their  successors  have been duly  elected and  qualified.  Executive
officers are elected by, and serve at the discretion of, the Board of Directors.


                                       26
<PAGE>

Compliance with Section 16(a) of the Exchange Act

      Based solely upon a review of Forms 3, 4 and 5 furnished to us pursuant to
Section  16(a)-3e  of the  Securities  Act of  1934,  we are  not  aware  of any
delinquencies  for the  period  ended May 31,  2006.  None of  Messrs.  Balaban,
Friedman,  Goldman  and Klein has filed  Forms 3 or 5, if  required.  We are not
aware of the requirement or exemption of any of such  individuals to file a Form
5, but notes the absence of any written  representation  identified in paragraph
(b)(2)(i) of Item 405 of Regulation S-B.

Code of Ethics

      On September 13, 2004, our Board of Directors adopted a Code of Ethics and
Business  Conduct  applicable  to all  members  of the Board of  Directors,  the
executive  officers  and  employees  of our  company  and a Code of Ethics  that
applies to all financial  executives  and employees of our company.  The Code of
Ethics and Business Conduct and the Code of Ethics for Financial  Executives and
Employees  were filed as Exhibits  14.1 and 14.2,  respectively,  to our Current
Report on Form 8-K as filed  with the  Securities  and  Exchange  Commission  on
September 29, 2004 and are incorporated herein by reference.

Committees of the Board of Directors

      The  Board  of  Directors  has   established  an  Audit  Committee  and  a
Compensation  Committee.  The Audit  Committee is responsible  for  recommending
independent auditors for selection by the Board of Directors, reviewing with the
independent  auditors the scope and results of the audit engagement,  monitoring
our  financial  policies and internal  control  procedures,  and  reviewing  and
monitoring the  provisions of non-audit  services  performed by our  independent
auditors.   The   Compensation   Committee  is  responsible  for  reviewing  and
recommending  salaries,  bonuses and other  compensation  for our officers.  The
Compensation  Committee  is also  responsible  for the  administering  our stock
option  plan and for  establishing  terms and  conditions  of all stock  options
granted  under this plan.  All of the  members  of the Audit  Committee  and the
Compensation  Committee  are  non-employee  directors.  Mr.  Friedman  has  been
appointed  to sit  on the  audit  committee  to  serve  as the  audit  committee
financial expert.  Mr. Friedman is considered  independent within the meaning of
Rule  4200(a)(15)  of the National  Association  of Securities  Dealers  listing
standards, as amended.


                                       27
<PAGE>

Item 10. Executive Compensation.

      The following table sets forth all  compensation  awarded to, earned by or
paid to our chief  executive  officer  ("CEO") of our  company and our four most
highly compensated executive officers,  whose salary and bonus exceeded $100,000
in compensation for the last fiscal year (collectively, the "Named Executives"):

<TABLE>
<CAPTION>
                                         SUMMARY COMPENSATION TABLE
                                                                                              Long-Term
                                                   Annual Compensation                   Compensation Awards
                                                                                     Securities
                                                                    Other Annual     Underlying         All Other
 Name and Principal     Fiscal       Salary          Bonuses        Compensation    Options/SARs     Compensation (1)
      Position           Year          ($)             ($)               ($)             (#)               ($)
<S>                      <C>         <C>               <C>           <C>                  <C>              <C>
Irwin Balaban (2)
  President and          2006             $0               $0        $50,000(3)                0              $0
   Chief Executive       2005              0                0              0              60,000               0
   Officer               2004              0                0              0              60,000               0

Judy Frenkel (4)         2006         56,438                0         30,000(5)                0          69,193(6)
  Chief Operating        2005        135,000           13,500              0                   0           4,455
   Officer               2004        128,000                0              0              50,000           3,874
</TABLE>

------------------

(1)   Represents  matching  contributions  made by the  Company  pursuant to the
      Company's 401(k) Plan.

(2)   Since  1983,  Mr.  Balaban  has been  Chairman  of the Board and since his
      retirement in March 1999,  has been providing  consulting  services to the
      Company under a consulting  agreement.  In his capacity as a consultant to
      the  Company,  Mr.  Balaban  assumed  the offices of  President  and Chief
      Executive Officer in July 2001.

(3)   Represents a one time consulting fee paid to Mr. Balaban.

(4)   Ms.  Frenkel's  employment  with the Company was terminated as a result of
      the asset sale on October 11, 2005.

(5)   Represents a one time  consulting fee paid after the asset sale on October
      11, 2005 and to Ms. Frenkel.

(6)   Includes severance of $67,500 paid to Ms Frenkel.


                                       28
<PAGE>

Stock Options

      The  following  table  sets  forth  information  with  respect  to  fiscal
year-ended May 31, 2006 option values.

<TABLE>
<CAPTION>
                                           OPTION YEAR END VALUES

                                                            Number of Securities          Value of Unexercised
                 Shares Acquired                           Underlying Unexercised      In-the-Money Options/SARs
                   on Exercise        Value Realized     Options/SARs at FY-End (#)          at FY-End ($)
       Name            (#)                  ($)          Exercisable/Unexercisable     Exercisable/Unexercisable
<S>                     <C>                 <C>                 <C>                           <C>
Irwin Balaban           --                  --                  125,000 / 0                   $14,800 / 0
</TABLE>

Directors' Compensation

      Each non-employee director receives $1,500 for each Board meeting attended
and is reimbursed for all  out-of-pocket  expenses  incurred in connection  with
attendance at meetings of the Board or any committee  thereof.  Upon election to
the Board of Directors,  each non-employee director is granted five-year options
to purchase  5,000  shares of Common  Stock at an  exercise  price equal to fair
market  value of our common stock at the date of grant.  In addition,  directors
serving on either the Audit Committee or the Compensation  Committee are granted
additional  five-year  options to purchase  2,500  shares our common stock at an
exercise price equal to the fair market value of our common stock at the date of
grant. These options vest immediately.

      During fiscal 2005, Irwin Balaban,  Robert  Friedman,  Herbert Goldman and
Lawrence Klein were each granted  five-year options to purchase 50,000 shares of
our common stock at an exercise  price of $.57 per share.  These options  vested
immediately. No options were granted during fiscal 2006.


                                       29
<PAGE>

Employment and Consulting Agreement

      As of May 30, 2002, we converted  debt incurred  under a prior  consulting
agreement  with Mr.  Balaban to a promissory  note,  bearing  interest at 3% per
annum and maturing on May 30, 2004.  As of May 30, 2003,  this note was extended
until June 30, 2005,  under the existing  terms.  All amounts were repaid during
fiscal 2006.

      On July 28,  2003,  we entered into an agreement  with Judy  Frenkel,  the
Chief Operating Officer that pertains to severance  compensation  payable to Ms.
Frankel upon the  occurrence  of certain  employment  termination  events.  This
agreement  provided Ms. Frenkel with three equal lump sum payments,  aggregating
fifty percent of her then current rate of annual base salary,  upon  termination
resulting from certain  qualifying  events,  as defined in the  agreement.  Such
qualifying  events  include but are not limited to, the failure by the surviving
corporation to offer employment to Ms. Frenkel following a change of control and
the  termination of employment of Ms.  Frenkel  without cause prior to the first
anniversary of a change in control of our company. As a result of the asset sale
on  October  11,  2005,  we paid a total of $67,500  to Ms.  Frenkel  under this
agreement.


                                       30
<PAGE>

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

      The  following  table sets forth,  as of September  13,  2006,  the names,
addresses  and number of shares of common  stock  beneficially  owned by (i) all
persons known to our  management to be beneficial  owners of more than 5% of the
outstanding shares of our common stock, (ii) each director of our company, (iii)
each named  Executive  Officer and (iv) all executive  officers and directors of
our  company as a group  (except as  indicated,  each  beneficial  owner  listed
exercises  sole  voting  power  and  sole  dispositive  power  over  the  shares
beneficially owned):

<TABLE>
<CAPTION>
                                                              Number of Shares
                     Name and Address of                        Beneficially           Percentage of Outstanding
                    Beneficial Owner (1)                          Owned (2)           Shares Beneficially Owned (2)
                    --------------------                          ---------           -----------------------------
<S>                                                               <C>                             <C>
Irwin Balaban................................................     1,106,100 (3)                   22.52%
Steven N. Bronson............................................       416,757                        8.61%
Robert B. Friedman...........................................       160,000 (4)                    3.26
Herbert Goldman..............................................       999,000 (5)                   20.36
Lawrence B. Klein                                                   754,000 (6)                   15.38
All executive officers and directors as a group (4 persons) .     3,019,100 (7)                   62.37
</TABLE>

------------------
(1)   The address of each Director is c/o Robocom Systems International Inc., 17
      Fairbanks Boulevard, Woodbury, NY 11797. The address of Mr. Bronson is 100
      Mill Plain Road, Danbury, CT 06811.

(2)   Except as indicated in the footnotes to this table,  the Company  believes
      that all persons named in the table have sole voting and investment  power
      with respect to all Common Stock shown as  beneficially  owned by them. In
      accordance  with the rules of the Securities and Exchange  Commission (the
      "Commission"),  a person or entity is deemed to be the beneficial owner of
      Common Stock that can be acquired by such person or entity  within 60 days
      upon the exercise of options or warrants or other rights to acquire Common
      Stock.  Each  beneficial  owner's  percentage  ownership is  determined by
      assuming  that options and warrants  that are held by such person (but not
      those held by any other person) and which are  exercisable  within 60 days
      have  been  exercised.  The  inclusion  herein  of such  shares  listed as
      beneficially   owned  does  not  constitute  an  admission  of  beneficial
      ownership.

(3)   Includes 564,000 shares held by I&T Balaban L.P. and 70,000 shares subject
      to options that are presently exercisable.

(4)   Includes 65,000 shares subject to options that are presently exercisable.

(5)   Includes 564,000 shares held by H & N Goldman L.P., 160,000 shares held by
      the Herbert Goldman  Revocable Trust,  160,000 shares held by the Naomi J.
      Goldman  Revocable  Trust and 65,000  shares  subject to options  that are
      presently exercisable.

(6)   Includes 60,000 shares subject to options that are presently exercisable.

(7)   Includes 260,000 shares subject to options that are presently exercisable.


                                       31
<PAGE>

Securities Authorized for Issuance under Equity Compensation Plans

      Our 1997 Stock Option and  Long-term  Incentive  Compensation  Plan is the
only compensation plan under which shares of common stock may be issued. We have
no equity  compensation  plans or  arrangements  that have not been  approved by
shareholders.

      The  following  table  sets forth  information  as of May 31,  2006,  with
respect to the  compensation  plan under which we are authorized to issue shares
of our common stock:

<TABLE>
<CAPTION>
                                            Equity Compensation Plan Information

                                               Number of
                                            securities to be
                                              issued upon            Weighted average             Number of securities
                                              exercise of           exercise price of        remaining for future issuance
                                              outstanding              outstanding             under equity compensation
                                           options, warrants        options, warrants         plans (excluding securities
                                               and rights               and rights             reflected in columns (a))
                                                  (a)                      (b)                            (c)
<S>                                              <C>                      <C>                            <C>
Equity compensation plans approved
  by security holders .................          460,000                  $  0.61                        645,000
Equity compensation plans not
  approved by security holders ........               --                       --                             --
                                                 -------                  -------                        -------
Total .................................          460,000                  $  0.61                        645,000
                                                 =======                  =======                        =======
</TABLE>

Item 12. Certain Relationships and Related Transactions.

      Pursuant to an  indemnification  agreement,  dated August 17, 2005, by and
among the Company and Messrs.  Irwin Balaban,  Chairman of the Board,  President
and Chief  Executive  Officer of the  Company,  Lawrence  B.  Klein and  Herbert
Goldman,  directors of the Company, the Company agreed to indemnify such persons
for any losses  they may incur  resulting  from their  agreement  to  personally
indemnify  Avantce RSI, LLC for certain  losses it may incur in the event of the
Company's breach of its  representations,  warranties and/or covenants set forth
in the Asset Purchase Agreement, dated August 17, 2005.

      As of May 30, 2002,  the Company  converted  debt  incurred  under a prior
consulting  agreement with Irwin Balaban,  Chairman of the Board,  President and
Chief Executive Officer of the Company,  to a promissory note,  bearing interest
at 3% per annum and maturing on May 30, 2004. As of May 30, 2003,  this note was
extended until June 30, 2005,  under the existing terms. All amounts were repaid
during fiscal 2006.

      As of May 30, 2002,  the Company  converted  debt  incurred  under a prior
consulting agreement with Herbert Goldman, a director and principal  shareholder
of the  Company  to a  promissory  note,  bearing  interest  at 3% per annum and
maturing on May 30, 2004. As of May 30, 2003,  this note was extended until June
30, 2005, under the existing terms. All amounts were repaid during fiscal 2006.

Item 13. Exhibits.

      The  exhibits  required  by this  item are  listed  on the  Exhibit  Index
attached  hereto  and are  either  filed  herewith  or  incorporated  herein  by
reference.


                                       32
<PAGE>


Item 14. Principal Accountant Fees and Services.

            We incurred  $48,000 and $44,000 for the fiscal  years ended May 31,
2005 and 2006,  respectively,  for audit and review services by Eisner and Lubin
LLP.  Eisner  & Lubin  LLP has  not  performed  any  other  services  for us not
expressly mentioned above.

Board of Directors Pre-Approval

      Our Board of Directors  pre-approved  the engagement of Eisner & Lubin LLP
to act as our  independent  auditor  for the year ended May 31, 2006 and through
the completion of our Annual Report on Form 10-KSB for the fiscal year ended May
31, 2007.  Our Board of Directors also  pre-approved  the engagement of Eisner &
Lubin LLP to provide the audit and review services described above.


                                       33
<PAGE>

                                   SIGNATURES

      Pursuant  to the  requirements  of Section  13 or 15(d) 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,  in Massapequa,  New
York, on September 13, 2006.

                                       ROBOCOM SYSTEMS INTERNATIONAL INC.


                                       By:  /s/ Irwin Balaban
                                            ------------------------------------
                                                Irwin Balaban
                                                Chief Executive Officer

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

<TABLE>
<CAPTION>
                Signature                                           Title                                  Date
<S>                                         <C>                                                    <C>
  /s/ Irwin Balaban                         Chairman of the Board and Chief Executive Officer      September 13, 2006
  --------------------------------------    (Principal Executive Officer, Principal Accounting
  Irwin Balaban                             Officer, and Principal Financial Officer)


  /s/ Lawrence B. Klein                     Director                                               September 13, 2006
  --------------------------------------
  Lawrence B. Klein


  /s/ Herbert Goldman                       Director                                               September 13, 2006
  --------------------------------------
  Herbert Goldman


  /s/ Robert B. Friedman                    Director                                               September 13, 2006
  --------------------------------------
  Robert B. Friedman
</TABLE>


                                       34
<PAGE>

                                  Exhibit Index

Exhibit
Number                                 Description
------                                 -----------

2.1       Asset Purchase  Agreement  dated August 17, 2005,  between the Company
          and Avantce RSI, LLC (incorporated by reference to Exhibit 10.1 to the
          Company's  Current  Report on Form 8-K as filed with the Commission on
          August 17, 2005 (File No. 0-22735)).

3.1       Restated  Certificate of  Incorporation  of the Company  (incorporated
          herein by  reference  to  Exhibit  3.1 to the  Company's  Registration
          Statement on Form SB-2 (Registration No. 333-27587)).

3.2       Amendment   dated   November  9,  1998  to  Restated   Certificate  of
          Incorporation of the Company to reflect name change to Robocom Systems
          International Inc. (incorporated herein by reference to Exhibit 3.2 to
          the Company's  Annual Report on Form 10-KSB for the year ended May 31,
          1999 as filed  with the  Commission  on  August  25,  1999  (File  No.
          0-22735)).

3.3       Amended and Restated  By-laws of the Company  (incorporated  herein by
          reference to Exhibit 3.2 to the  Company's  Registration  Statement on
          Form SB-2 (Registration No. 333-27587)).

3.4       Amendment dated July 13, 2006 to Restated Certificate of Incorporation
          of the Company (incorporated herein by reference to Exhibit 3.1 to the
          Company's  Current  Report on Form 8-K as filed with the Commission on
          July 17, 2006 (File No. 0-22735)).

10.1      1997  Stock  Option  and   Long-Term   Incentive   Compensation   Plan
          (incorporated  herein by reference to Exhibit  10.14 to the  Company's
          Registration Statement on Form SB-2 (Registration No. 333-27587)).

10.2      Stock  Purchase  Warrant  Agreement  dated May 27,  2003  between  the
          Company and Robocom Properties, Inc. (incorporated herein by reference
          to Exhibit 10.11 to the Company's Annual Report on Form 10-KSB for the
          year  ended May 31,  2003 as filed with the  Commission  on August 18,
          2003 (File No. 0-22735)).

10.3      Severance  Agreement  dated July 18, 2003 between the Company and Judy
          Frenkel  (incorporated  herein by  reference  to Exhibit  10.12 to the
          Company's Annual Report on Form 10-KSB for the year ended May 31, 2003
          as filed with the Commission on August 18, 2003 (File No. 0-22735)).

10.4      Indemnification  Agreement  dated as of  August  17,  2005,  among the
          Company,  Irwin  Balaban,  Herbert  Goldman  and  Lawrence  B.  Klein
          (incorporated  herein by reference to Exhibit to the Company's Annual
          Report on Form  10-KSB for the year ended May 31,  2005 as filed with
          the Commission on August 26, 2005 (File No. 022735).

14.1      Robocom Systems International Inc. Code of Ethics and Business Conduct
          (incorporated  herein by reference  to Exhibit  14.1 to the  Company's
          Current  Report  filed  on Form 8-K as filed  with the  Commission  on
          September 24, 2004 (File No. 0-22735)).

14.2      Robocom  Systems  International  Inc.  Code of  Ethics  for  Financial
          Executives and Employees  (incorporated herein by reference to Exhibit
          14.2 to the Company's  Current  Report filed on Form 8-K as filed with
          the Commission on September 24, 2004 (File No. 0-22735)).

31.1      Certification  of the Company's Chief Executive  Officer and principal
          accounting  officer,  Irwin  Balaban,  pursuant  to Section 302 of the
          Sarbanes-Oxley Act of 2002.

32.1      Certification  of the Company's Chief Executive  Officer and principal
          accounting  officer,  Irwin  Balaban,  pursuant  to Section 906 of the
          Sarbanes-Oxley Act of 2002.


                                       35