UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT
     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

       Date of Report (Date of earliest event reported): February 24, 2006

                          Lounsberry Holdings II, Inc.
             (Exact name of registrant as specified in its charter)

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<CAPTION>
<S>                                          <C>                            <C>
               Delaware                              0-51378                                51-0539828
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   (State or other jurisdiction of           (Commission File Number)       (I.R.S. Employer Identification No.)
            incorporation)
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 One Bella Drive, Westminster, Massachusetts                 01473
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   (Address of principal executive offices)                (Zip Code)

                90 Grove Street, Suite 204, Ridgefield, CT 06877
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                 (Former address of principal executive offices)

Registrant's telephone number, including area code: (978) 874-0591

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):

|_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)

|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)

|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))

|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
<PAGE>

Item 1.01. Entry into a Material Definitive Agreement.

      On February 24, 2006, Lounsberry Holdings II, Inc. (the "Company")
acquired the stock of Ranor, Inc., a Delaware corporation ("Ranor"), pursuant to
a stock purchase agreement dated as of August 17, 2005, by and among Ranor
Acquisition LLC, a Delaware limited liability company ("Ranor Acquisition"), the
former stockholders of Ranor, and Ranor, which agreement, as amended, is
referred to as the "Ranor Agreement." In connection with the acquisition of
Ranor pursuant to the Ranor Agreement:

      (a) The Company entered into a preferred stock purchase agreement (the
"Preferred Stock Agreement") with Barron Partners LP, pursuant to which Barron
Partners invested $2,200,000 for which the Company issued 7,719,250 shares of a
newly-created series of preferred stock, designated as the series A preferred
stock, and warrants (the "Warrants") to purchase an aggregate of 11,220,000
shares of common stock. The series A preferred stock is convertible into
7,719,250 shares of common stock, subject to adjustment.

      (b) The Company entered into a registration rights agreement (the "Barron
Registration Rights Agreement") pursuant to which the Company agreed to register
the shares of common stock issuable upon conversion of the Series A Preferred
Stock and the Warrants pursuant to the Securities Act of 1933, as amended (the
"Securities Act").

      (c) The Company entered into a stock redemption agreement with Capital
Markets Advisory Group, LLC ("Capital Markets"), which was then the Company's
principal stockholder, pursuant to which the Company purchased 928,000 shares of
common stock from Capital Markets for $200,000, using the proceeds from the
Preferred Stock Agreement.

      (d) The Company entered into an agreement (the "Acquisition Company
Agreement") with Ranor Acquisition, the members of Ranor Acquisition, pursuant
to which Ranor Acquisition assigned its obligations under the Ranor Agreement,
the Company assumed the obligations of Ranor Acquisition under the Ranor
Agreement and the Company issued 7,697,000 shares of common stock.

      (e) The Company entered into a stock subscription agreement pursuant to
which the Company issued 1,700,000 shares of common stock.

      (f) Ranor entered into a loan and security agreement with Sovereign Bank
pursuant to which the Company borrowed $4.0 million, for which the Company
issued its term note, and Sovereign provided the Company with a $1.0 million
revolving credit arrangement.

      (g) Ranor sold its real estate to WM Realty Management, LLC ("WM") for
$3.0 million, and Ranor leased the real property on which its facilities are
located from WM pursuant to a triple net lease. WM is an affiliate of the
Company.

      (h) Ranor entered into a management agreement with Techprecision LLC,
pursuant to which Techprecision would provide management services to Ranor.


                                      -1-
<PAGE>

The Ranor Agreement

      Pursuant to the Ranor Agreement, the Company acquired all of the
outstanding capital stock and warrants of Ranor for a total purchase price of
$9.25 million, less amounts paid to the holders of Ranor's outstanding debt. The
debt was held by the preferred stockholders, and substantially all of the
proceeds were applied to the payment of the debt. The Ranor agreement also
provides that the Ranor stockholders may withdraw Ranor's cash in excess of
$250,000 at the closing. The total amount paid pursuant to this provision was
$813,000. At the closing, the Company deposited $925,000 of the purchase price
into escrow as security for any damages which the Company may sustain as a
result of a breach of the representations and warranties under the Ranor
Agreement.

      The purchase price, including payment by Ranor of the notes, was paid from
the net proceeds of the $4.0 million term loan from Sovereign ($3,953,317.47),
the sale by Ranor of the real estate to WM ($3,000,000), the proceeds from the
sale of the series A preferred stock ($1,129,182.53) and $240,000 from the cash
remaining at Ranor after payment of the $813,000.

      Following the closing, the Company cancelled all of the outstanding
preferred stock and warrants and all but 1,000 shares of Ranor's common stock.

Preferred Stock Agreement

      Pursuant to the Preferred Stock Agreement:

      o     The Company sold to Barron Partners, for $2,200,000, (i) 7,719,250
            shares of series A preferred stock and Warrants to purchase
            5,610,000 shares of common stock at an exercise price of $.57 per
            share and 5,610,000 shares of common stock at an exercise price of
            $.855 per share. The terms of the series A preferred stock are set
            forth in "Item 5.03. Amendments to Articles of Incorporation or
            By-laws; Changes in Fiscal Year."

      o     The Company agreed that it will have appointed such number of
            independent directors that would result in a majority of its
            directors being independent directors, that the audit committee
            would be composed solely of independent directors and the
            compensation committee would have a majority of independent
            directors. Failure of the Company to meet these requirements would
            results in the imposition of liquidated damages which are payable in
            cash or additional shares of series A preferred stock. As of the
            date of this report, the Company has satisfied this requirement.

      o     The Company and Barron Partners entered into the Registration Rights
            Agreement.

      o     The Certificate of Designation and the Barron Warrants provide that
            the series A preferred stock cannot be converted and Barron Warrants
            cannot be exercised if such conversion or exercise would result in
            the holder and its affiliates of more than 4.9% of the then
            outstanding number of shares of common stock on such date.
            Beneficial ownership is determined in accordance with Section 13(d)
            of the Securities Exchange Act of 1934, as amended, and Regulation
            13d-3. This limitation may not be modified or waived.

      o     The Company's board of directors approved and agreed to submit to
            the Company's stockholders for their approval, an amendment to the
            Company's certificates of incorporation to provide that the terms
            and conditions of any rights, options and warrants approved by the
            board of directors may provide that any or all of such terms and
            conditions may be waived or amended only with the consent of the
            holders of a designated percentage of a designated class or classes
            of capital stock of the Company (or a designated group or groups of
            holders within such class or classes, including but not limited to
            disinterested holders), and the applicable terms and conditions of
            any such rights, options or warrants so conditioned may not be
            waived or amended absent such consent."


                                      -2-
<PAGE>

      o     The warrants issued to the investors have a term of five years. In
            the event our EBITDA per share of common stock, as defined, for the
            fiscal year ended March 31, 2006, is less than $.06591 per share,
            the Exercise Price shall be reduced proportionately by up to 15%.
            The exercise price will be reduced by 15% if EBITDA per share
            $.04613 per share or lower. In the event our EBITDA per share of
            common stock for the fiscal year ended March 31, 2007, is less than
            $.08568 per share, the Exercise Price shall be reduced
            proportionately by up to 15%. The exercise price will be reduced by
            15% if EBITDA per share $.05997 per share or lower.

      o     The warrants also provide that, with certain exceptions, if the
            Company issues common stock at a price, or warrants or other
            convertible securities with an exercise or conversion price which is
            less than the exercise price of the warrants, the exercise price of
            the warrants will be reduced in accordance with a formula based on
            the exercise price or conversion price, as the case may be, of such
            other securities.

      o     The Company reimbursed Barron Partners for its due diligence and
            other expenses in the amount of $50,000.

Barron Registration Rights Agreement

      Pursuant to the Barron Registration Rights Agreement, the Company agreed
to file, within 60 days after the closing (February 24, 2006), a registration
statement covering the common stock issuable upon conversion of the series A
preferred stock and exercise of the Warrants. The failure of the Company to meet
this schedule and other timetables provided in the registration rights agreement
would result in the imposition of liquidated damages, which are payable through
the issuance of additional shares of series A preferred stock. If we fail to
file a registration statement within 60 days of the closing or if the
registration statement is not declared effective by the SEC on the first to
occur of (i) 120 days following the date the registration statement is required
to be filed, (ii) ten days following the receipt of a "No Review" or similar
letter from the SEC or (iii) the third business day following the day the
Company receives notice from the SEC that the SEC has determined that the
Registration Statement eligible to be declared effective without further
comments by the SEC. The Company is required to pay liquidated damages in shares
of series A preferred stock, and not cash. The number of shares to be issued by
the Company as liquidated damages is 2,540 shares of series A preferred stock
for each day the Company has not complied with its registration requirements, up
to a maximum of 1.4 million shares of series A preferred stock. If, at the time
of a failure of the Company to maintain the effectiveness of the registration
statement, the holder shall own less than the number of shares of series A
preferred stock initially issued by the Company, the number of shares of series
A preferred stock issuable per day shall be reduced proportionately.


                                      -3-
<PAGE>

Acquisition Company Agreement

      Pursuant to the Acquisition Company Agreement, Ranor Acquisition assigned
the Ranor Agreement to the Company, and the Company assumed the obligations of
Ranor Acquisition pursuant to the Ranor Agreement. In consideration for the
assignment and for expenses of $115,000 advanced by Ranor Acquisition on behalf
of the Company, the Company issued to the members of Ranor Acquisiton, an
aggregate of 7,697,000 shares of common stock.

      The Acquisition Company Agreement provides that the Acquisition Company
members, who received 7,697,000 shares of common stock may not sell these shares
for a period of twelve months following the closing. Thereafter, none of the
members shall sell more than 10% of his or her shares in the public market in
the twelve-month period following the expiration of the lock-up period of more
than an additional 10% of his shares during the following twelve-month period.
Commencing January 31, 2007, the holders have demand and piggyback registration
rights. The Company is not subject to any liquidated damages in the event that
Company fails to satisfy its obligations to register the shares.

Subscription Agreement

      Pursuant to the Subscription Agreement, the Company sold 1,700,000 shares
of common stock to an accredited investor for $500,000. Commencing January 31,
2007, the investor has demand and piggyback registration rights. The Company is
not subject to any liquidated damages in the event that Company fails to satisfy
its obligations to register the shares.

Stock Redemption Agreement

      Pursuant to an agreement dated February 24, 2006 between the Company and
Capital Markets, which was then the Company's principal stockholder, the Company
purchased 928,000, constituting 90.2% of the then outstanding shares of the
Company's common stock, from Capital Markets for $200,000. The purchase price
was paid from the proceeds of the sale of series A preferred stock to Barron
Partners. In connection with that agreement, the Company agreed to include all
of the then-outstanding shares of common stock in the first registration
statement that the Company files after the closing.

Loan and Security Agreement

      Pursuant to the loan and security agreement with Sovereign Bank, Ranor
borrowed $4.0 million on a term loan basis, for which it issued is its
promissory note due March 1, 2013. Ranor pays interest at 9% per annum until
February 28, 2011 and at prime plus 1 1/2% per annum thereafter. The note
provides for quarterly payments of $142,857.14. Ranor is also required to
utilize 50% of the excess its cash flow above the required 1.2 times the fixed
charge coverage ratio to be applied to payments due on the Term Loan in the
inverse order of maturity. Such amount shall be due on or before April 1, 2007
for the period ending March 31, 2007, and annually on July 1 of each year
thereafter.

      Ranor also issued its revolving promissory note in the principal amount of
$1.0 million. Ranor has the right to draw on this facility from time to time,
based on a borrowing base formula. The note bears interest at the rate of prime
plus 1 1/2%.


                                      -4-
<PAGE>

      Payment of the notes and Ranor's obligaitions under the loan agreement and
the notes is secured by a security interest in substantially all of Ranor's
assets, and is guaranteed by the Company. The Company's guaranty is secured by a
pledge of the Ranor stock.

Sale and Leaseback of Real Property

      Ranor sold its real property to WM, an affiliate of the Company, for a
purchase price of $3.0 million, and leased back from WM all of the property,
except for three parcels which could be used for residential lots, pursuant to a
triple net lease. The lease has a term of 15 years at an initial annual rental
of $438,000, subject to an annual cost of living adjustment. Ranor has two five
year options at a rental equal to the greater of the then current minimum annual
rental or the fair rental. Ranor has a purchase option at the appraised value,
but not less than the amount due to WM's lender, determined as provided in the
lease. WM has a $3.3 million mortgage on the premises which matures on August
24, 2006. If Ranor exercises its option, it purchases all of the property owned
by WM. In the event of a default by WM under its present mortgage, our monthly
rent will increase to $39,000.

Management Agreement

      Pursuant to the management agreement, Ranor engaged Techprecision LLC as
its manager. Techprecision is to provide the services of James G. Reindl as
chairman, Andrew A. Levy for marketing support and analysis of long-term
contracts and Martin M. Daube for marketing support. The management agreement
has a term expiring on March 31, 2009, and provided for annual compensation at
the rate of $200,000 per year. Neither Mr. Reindl, Mr. Levy nor Mr. Daube
receives any additional compensation from Ranor for the services performed
pursuant to the management agreement. In addition, if Ranor meets or exceeds
performance criteria set by the compensation committee (which is to be composed
of independent directors), Techprecision received a bonus equal to 2 1/2% of
earnings before interest, taxes, depreciation and amortization after giving
effect to the bonus.

Item 2.01. Completion of Acquisition or Disposition of Assets.

Information in response to this Item 2.01 is keyed to the Item numbers of Form
10SB.

                                     Part I

Item 1.  Description of Business

                                     SUMMARY

      On February 24, 2006, the Company acquired Ranor pursuant to the Ranor
Agreement, which is described under "Item 1.01. Entry into a Material Definitive
Agreement."

      References to "we," "us," "our" and similar words refer to the Company
and, where applicable, Ranor, which, as a result of the purchase of the Ranor
stock because the Company's wholly-owned subsidiary in a transaction accounted
for as a reverse acquisition. Prior to the effectiveness of the reverse
acquisition these terms refer to Ranor.

      We produce large metal fabrications and perform precision machining
operations for large military, commercial, nuclear, aerospace, shipbuilding and
industrial customers. Our principal services are large metal fabrications,
machining and engineering. Each of our contracts covers a specific product. We
do not mass-produce any products or distribute such products on the open market.
We render our services under "build to print" contracts with our contractors.
However, we also help our customers to analyze and develop their projects for
constructability by providing engineering and research and development services,
for which we bill our customers.


                                      -5-
<PAGE>

      We are one of a small number of large precision metal fabrication
companies located in the United States. However, only two others produce
products in all industry sectors that we service. In recent years, the capital
goods market experienced a slow down due to the industry over-build of product
in the late 1990's. Additional contributions to the industry slow-down resulted
from the events of September 11, 2001. However, based on recent project
inquiries, recent projects awarded and current customer demands for our
services, we believe the our market has rebounded.

      Although we provide manufacturing services to large governmental programs,
we usually do not work directly for agencies of the United States government.
Rather, we performs our services for large governmental contractors and large
utility companies.

Organization; Merger

      On February 24, 2006, pursuant to the Ranor Agreement, we acquired all of
the equity securities of Ranor. See "Item 1.01 Entry into Definitive Material
Agreement." As a result of the acquisition of Ranor, our business is the
business of Ranor. The stock purchase will be accounted for as a reverse
acquisition. The accounting rules for reverse acquisitions require that
beginning with the date of the merger, February 24, 2006, our balance sheet
includes the assets and liabilities of Ranor and our equity accounts were
recapitalized to reflect the net equity of Ranor. In addition, the Company's
historical operating results will be the operating results of Ranor.

      Ranor has been in business since 1956, and was sold by its founders in
1999 to Critical Components Corporation, a subsidiary of Standard Automotive
Corporation. From June 1999 until August 2002, Ranor was operated by Critical
Components Corporation. In December 2001, Standard filed for protection under
the Bankruptcy Code and operated under Chapter 11 until on or about the quarter
ended June 30, 2002. Subsequently, all Standard's holdings were sold. In 2003,
Ranor, then known as Rbran Acquisition, Inc., acquired the Ranor assets from the
bankruptcy estate. Ranor is a Delaware corporation, founded in May 2002 under
the name Rbran Acquisition, Inc. and changed its name to Ranor, Inc. in August
2002. Ranor's executive offices are located at One Bella Drive, Westminster, MA
01473, telephone (978) 874-0591. Ranor' website is http://www.ranor.com.
Information on Ranor's website or any other website is not part of this current
report on Form 8-K.

      The Company is a Delaware corporation, organized in 2005. Its executive
offices are located at One Bella Drive, Westminster, MA 01473, telephone (978)
874-0591.

                                  RISK FACTORS

      An investment in our securities involves a high degree of risk. In
determining whether to purchase our securities, you should carefully consider
all of the material risks described below, together with the other information
contained in this prospectus before making a decision to purchase our
securities. You should only purchase our securities if you can afford to suffer
the loss of your entire investment.


                                      -6-
<PAGE>

RISKS RELATING TO OUR BUSINESS

We may require additional financing for our operations.

      The Ranor agreement required us to pay our former stockholders all of our
cash in excess of $250,000, and we used $240,000 of this amount to make payment
to the former stockholders that were due under the Ranor Agreement. As a result,
upon completion of the reverse acquisition, our cash position was $10,000. The
only funding available to us, other than our cash flow from operations, is $1.0
million revolving credit line with Sovereign Bank. We cannot assure you that
this facility will be sufficient to provide us with the funds necessary to
enable us to perform our obligations under our contracts. Our failure to obtain
any required financing could impair our ability to both serve our existing
clients base and develop new clients and could result in both a decrease in
revenue and an increase in our loss.

As a result of the reverse acquisition, our expenses will increase
significantly.

      As a result of the reverse acquisition, our ongoing expenses have
increased significantly, including expenses in compensation to Techprecision
under its management agreement and ongoing public company expenses. Our failure
to generate sufficient revenue, to reduce expenses or to obtain financing to
cover our increased level of expenses could impair our ability to continue in
business. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and "Management - Compensation" in this Item 2.01.

Our losses are continuing and we may not be able to operate provitably.

      We have shown losses for the fiscal years ended March 31, 2005 and 2004,
and such losses have continued through the nine months ended December 31, 2005.
We cannot assure you that we will be able to operate profitably, and the
additional expenses which we are incurring as a result of our status as a
reporting company under the Securities Exchange Act of 1934, as amended, may
increase the difficulty in operating profitably.

Because all of our services are performed pursuant to special order contracts,
we have no continuing source of revenue.

      We do not have long-term contracts with any customer, and major contracts
with a small number of customers accounts for a significant percentage of our
revenue. For the nine months ended December 31, 2005, our two largest customers
accounted for approximately 40% of our revenue, and each of these customers
accounted for less than 10% of our revenue in the fiscal year ended March 31,
2006. We must bid each contract separately, and when we complete a contract,
there is generally no continuing source of revenue under that contract. As a
result, we cannot assure you that we have a continuing stream of revenue. Our
failure to generate new business on an ongoing basis would materially impair our
ability to operate profitably.


                                      -7-
<PAGE>

Because a significant portion of our revenue is derived from services rendered
from the defense, aerospace and related industries, our operating results may
suffer from conditions affecting this market.

      Substantially all of our revenue is derived from customers in the defense,
aerospace, nuclear, industrial and related industries. Our business may suffer
from any budgeting, economic or other trends that have the effect of reducing
the requirements for our services, including changes in federal budgeting which
may reduce the budget of those agencies that either engage us directly or affect
the contracts of private sector clients for whom we perform services as
subcontractors under prime contracts with government agencies.

We face significant competition from both domestic and foreign sources.

      We face competition from a number of domestic and foreign companies, some
of which are considerably larger and better capitalized than we are. For some of
our products, such as commercial nuclear canisters and machine parts, we compete
with foreign manufacturers, which have may have costs than we, which could
impact our ability to make sales of these products.

Our operating results in future periods may vary from quarter to quarter, and,
as a result, we may fail to meet the expectations of our investors and analysts,
which may cause our stock price to fluctuate or decline.

      Our revenue and operating results have fluctuated from quarter to quarter
significantly in the past. We expect that fluctuations in both revenue and net
income will continue due to a variety of factors, many of which are outside of
our control and which reflect the nature of our business. A substantial portion
of our operating expenses is related to personnel costs, depreciation and rent
which cannot be adjusted quickly and, therefore, cannot be easily reduced in
response to lower revenue levels or changes in client requirements. Due to these
factors and the other risks discussed in this current report on Form 8-K, you
should not rely on period-to-period comparisons of our results of operations as
an indication of future performance.

Our failure to meet our customers' requirement could result in decreased
revenue, increased costs and negative publicity.

      Our products require the precision manufacturing of products to very
exacting specifications which are required in the industries to which we market
our services. Our failure to meet these specifications could result in both cost
overruns on a particular contract and a loss of our reputation, which would
significantly impair our ability to generate contracts.

As a government subcontractor we are subject to government regulations.

      We must comply with complex procurement laws and regulations. If a
government review or investigation uncovers improper or illegal activities, we
may be subject to civil and criminal penalties and administrative sanctions,
including termination of contracts, forfeiture of profits, suspension of
payments and debarment from doing business with federal government agencies.


                                      -8-
<PAGE>

Because our contracts are generally awarded through a competitive bidding
process, we cannot be assured of obtaining business.

      Our government subcontracts are usually awarded through a competitive
bidding process which entails risks not present in other circumstances. We may
spend substantial sums analyzing and preparing a bid and not be awarded a
contract. Furthermore, we may not be given the opportunity to comment on the
proposed terms of the bid, and it is possible that a bid may be tailored to meet
the specifications of a competitor. Our failure to receive contracts on which we
bid could significantly impair our ability to continue in business.

The terms on which we may raise additional capital may result in significant
dilution and may impair our stock price.

      Because of both the absence of a public market for our common stock, the
terms of our recent private placement and the number of outstanding warrants and
the exercise price and other terms on which we may issued common stock upon
exercise of the warrants, it may be difficult for us to raise additional capital
if required for our present businesses and for any planned expansion. We cannot
assure you that we will be able to get additional financing on any terms, and,
if we are able to raise funds, it may be necessary for us to sell our securities
at a price which is at a significant discount from the market price and on other
terms which may be disadvantageous to us. In connection with any such financing,
we may be required to provide registration rights to the investors and pay
damages to the investor in the event that the registration statement is not
filed or declared effective by specified dates. The price and terms of any
financing which would be available to us could result in both the issuance of a
significant number of shares and significant downward pressure on our stock
price and could result in a reduction of the conversion price of the series A
preferred stock and exercise price of the warrants held by the Barron Partners.

We may not be able to continue to grow through acquisitions.

      An important part of our growth strategy is to expand our business and to
acquire other businesses, which may or may not be related to our current
businesses. Such acquisitions may be made with cash or our securities or a
combination of cash and securities. If our stock price is less than the exercise
price of the outstanding warrants, it is not likely that that warrants will be
exercised. To the extent that we require cash, we may have to borrow the funds
or sell equity securities. The issuance of equity, if available, would result in
dilution to our stockholders. We have no commitments from any financing source
and we may not be able to raise any cash necessary to complete an acquisition.
If we fail to make any acquisitions, our future growth may be limited. As of the
date of this current report on Form 8-K, we do not have any agreement or
understanding, either formal or informal, as to any acquisition.

If we make any acquisitions, they may disrupt or have a negative impact on our
business.

      If we make acquisitions, we could have difficulty integrating the acquired
companies' personnel and operations with our own. In addition, the key personnel
of the acquired business may not be willing to work for us. We cannot predict
the affect expansion may have on our core business. Regardless of whether we are
successful in making an acquisition, the negotiations could disrupt our ongoing
business, distract our management and employees and increase our expenses. In
addition to the risks described above, acquisitions are accompanied by a number
of inherent risks, including, without limitation, the following:


                                      -9-
<PAGE>

      o     the difficulty of integrating acquired products, services or
            operations;

      o     the potential disruption of the ongoing businesses and distraction
            of our management and the management of acquired companies;

      o     the difficulty of incorporating acquired rights or products into our
            existing business;

      o     difficulties in disposing of the excess or idle facilities of an
            acquired company or business and expenses in maintaining such
            facilities;

      o     difficulties in maintaining uniform standards, controls, procedures
            and policies;

      o     the potential impairment of relationships with employees and
            customers as a result of any integration of new management
            personnel;

      o     the potential inability or failure to achieve additional sales and
            enhance our customer base through cross-marketing of the products to
            new and existing customers;

      o     the effect of any government regulations which relate to the
            business acquired;

      o     potential unknown liabilities associated with acquired businesses or
            product lines, or the need to spend significant amounts to retool,
            reposition or modify the marketing and sales of acquired products or
            the defense of any litigation, whether of not successful, resulting
            from actions of the acquired company prior to our acquisition.

      Our business could be severely impaired if and to the extent that we are
unable to succeed in addressing any of these risks or other problems encountered
in connection with these acquisitions, many of which cannot be presently
identified, these risks and problems could disrupt our ongoing business,
distract our management and employees, increase our expenses and adversely
affect our results of operations.

Risks Related to our Common Stock and the Market for our Common Stock.

The rights of the holders of common stock may be impaired by the potential
issuance of preferred stock.

      Our certificate of incorporation gives our board of directors the right to
create new series of preferred stock. As a result, the board of directors has
and in the future may, without stockholder approval, issue preferred stock with
voting, dividend, conversion, liquidation or other rights which could adversely
affect the voting power and equity interest of the holders of common stock.
Preferred stock, which could be issued with the right to more than one vote per
share, could be utilized as a method of discouraging, delaying or preventing a
change of control. The possible impact on takeover attempts could adversely
affect the price of our common stock. Although we have no present intention to
issue any additional shares of preferred stock or to create any new series of
preferred stock and the certificate of designation relating to the series A
restricts our ability to issue additional series of preferred stock, we may
issue such shares in the future.


                                      -10-
<PAGE>

The issuance of shares through our stock compensation and incentive plans may
dilute the value of existing stockholders.

      We may use stock options, stock grants and other equity-based incentives,
to provide motivation and compensation to our officers, employees and key
independent consultants. The award of any such incentives will result in an
immediate and potentially substantial dilution to our existing stockholders and
could result in a decline in the value of our stock price.

Shares may be issued pursuant to our stock plans which may affect the market
price of our common stock.

      We may issue stock upon the exercise of options or pursuant to stock
grants covering a total of 1,000,000 shares of common stock pursuant to our 2006
long-term incentive plan. We also intend to issue 133,000 shares of restricted
stock to certain key employees. The exercise of these options and the sale of
the underlying shares of common stock and the sale of stock issued pursuant to
stock grants may have an adverse effect upon the price of our stock.

Because we are not subject to compliance with rules requiring the adoption of
certain corporate governance measures, our stockholders have limited protections
against interested director transactions, conflicts of interest and similar
matters.

      The Sarbanes-Oxley Act of 2002, as well as rule changes proposed and
enacted by the SEC, the New York and American Stock Exchanges and the Nasdaq
Stock Market as a result of Sarbanes-Oxley require the implementation of various
measures relating to corporate governance. These measures are designed to
enhance the integrity of corporate management and the securities markets and
apply to securities which are listed on those exchanges or the Nasdaq Stock
Market. Because we are not presently required to comply with many of the
corporate governance provisions and because we chose to avoid incurring the
substantial additional costs associated with such compliance any sooner than
necessary, we have not yet adopted all of these measures. Because none of our
directors are independent directors, we do not have independent audit or
compensation committees. We also are not in compliance with requirements
relating to the distribution of annual and interim reports, the holding of
stockholders meetings and solicitation of proxies for such meeting and
requirements for stockholder approval for certain corporate actions. Until we
comply with such corporate governance measures, regardless of whether such
compliance is required, the absence of such standards of corporate governance
may leave our stockholders without protections against interested director
transactions, conflicts of interest and similar matters and investors may be
reluctant to provide us with funds necessary to expand our operations.

Failure to achieve and maintain effective internal controls in accordance with
Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on
our business and operating results and stockholders could lose confidence in our
financial reporting.

      Effective internal controls are necessary for us to provide reliable
financial reports and effectively prevent fraud. If we cannot provide reliable
financial reports or prevent fraud, our operating results could be harmed. We
may be required to document and test our internal control procedures in order to
satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, which
requires increased control over financial reporting requirements, including
annual management assessments of the effectiveness of such internal controls and
a report by our independent certified public accounting firm addressing these
assessments. Failure to achieve and maintain an effective internal control
environment, regardless of whether we are required to maintain such controls,
could also cause investors to lose confidence in our reported financial
information, which could have a material adverse effect on our stock price.


                                      -11-
<PAGE>

We do not anticipate paying dividends on our common stock.

      We are prohibited from paying dividends on our common stock while the
series A preferred stock is outstanding.

Because there is no public market for our common stock, you may have difficulty
selling common stock that you own.

      Although we are registered pursuant to the Securities Exchange Act of
1934, we have approximately 40 stockholders and there is no public market for
our common stock. None of the presently outstanding shares of common stock may
be sold except pursuant to an effective registration statement. We have agreed
to file a registration statement to enable our stockholders to sell their
shares, neither the filing of a registration statement nor the effectiveness of
the registration statement will assure a public market for out common stock.
Accordingly we cannot assure you that there will be any public market for our
common stock.

Because we may be subject to the "penny stock" rules, you may have difficulty in
selling our common stock.

      If a public market develops for our common stock and if our stock price is
less than $5.00 per shares, our stock would be subject to the SEC's penny stock
rules, which impose additional sales practice requirements and restrictions on
broker-dealers that sell our stock to persons other than established customers
and institutional accredited investors. These rules may affect the ability of
broker-dealers to sell our common stock and may affect your ability to sell any
common stock you may own.

      According to the SEC, the market for penny stocks has suffered in recent
years from patterns of fraud and abuse. Such patterns include:

      o     Control of the market for the security by one or a few
            broker-dealers that are often related to the promoter or issuer;

      o     Manipulation of prices through prearranged matching of purchases and
            sales and false and misleading press releases;

      o     "Boiler room" practices involving high pressure sales tactics and
            unrealistic price projections by inexperienced sales persons;

      o     Excessive and undisclosed bid-ask differentials and markups by
            selling broker-dealers; and


                                      -12-
<PAGE>

      o     The wholesale dumping of the same securities by promoters and
            broker-dealers after prices have been manipulated to a desired
            level, along with the inevitable collapse of those prices with
            consequent investor losses.

As an issuer of "penny stock" the protection provided by the federal securities
laws relating to forward looking statements does not apply to us.

      Although the federal securities law provide a safe harbor for
forward-looking statements made by a public company that files reports under the
federal securities laws, this safe harbor is not available to issuers of penny
stocks. As a result, we will not have the benefit of this safe harbor protection
in the event of any based upon an claim that the material provided by us,
including this current report on Form 8-K, contained a material misstatement of
fact or was misleading in any material respect because of our failure to include
any statements necessary to make the statements not misleading.

Fluctuations in our operating results and announcements and developments
concerning our business affect our stock price.

      Historically, there has been volatility in the market price for common
stock of companies such as us. Our quarterly operating results, the number of
stockholders desiring to sell their shares, changes in general economic
conditions and the financial markets, the execution of new contracts and the
termination or expiration of existing license agreements and other developments
affecting us, could cause the market price of our common stock to fluctuate
substantially. Further, since a majority of our operating expenses, particularly
personnel and related costs, depreciation and rent, are relatively fixed in
advance of any particular quarter, the underutilization of our technical
personnel may cause significant variations in our operating results in any
particular quarter and could result in losses for the quarter.

We cannot predict when or whether an active market for our common stock will
develop.

      In the absence of an active trading market, you may have difficulty buying
and selling or obtaining market quotations; the market visibility for our stock
may be limited, and the lack of visibility for our common stock may have a
depressive effect on the market price for our common stock.

Our stock price may be affected by our failure to meet projections and estimates
of earnings developed either by us or by independent securities analysts.

      Although we do not make projections relating to our future operating
results, our operating results may fall below the expectations of securities
analysts and investors. In this event, the market price of our common stock
would likely be materially adversely affected.

The registration and potential sale by our stockholders of a significant number
of shares could encourage short sales by third parties.

      The number of shares of common stock that is subject to registration
rights includes all of the 7,719,250 shares of common stock issuable on
conversion of the series A preferred stock held by Barron Partners as well as
the 11,220,000 shares of common stock issuable to Barron Partners upon exercise
of its warrants, together with the 100,000 shares of common stock owned by our
stockholders prior to the reverse acquisition. The significant downward pressure
on our stock price caused by the sale or potential sale of a significant number
of shares could cause our stock price to decline, thus allowing short sellers of
our stock an opportunity to take advantage of any decrease in the value of our
stock. The presence of short sellers in our common stock may further depress the
price of our common stock.


                                      -13-
<PAGE>

      If stockholders whose shares are being registered sell a significant
number of shares of common stock, the market price of our common stock may
decline. Furthermore, the sale or potential sale the offered shares and the
depressive effect of such sales or potential sales could make it difficult for
us to raise funds from other sources.

                           FORWARD-LOOKING STATEMENTS

      Statements in this current report on Form 8-K may be "forward-looking
statements." Forward-looking statements include, but are not limited to,
statements that express our intentions, beliefs, expectations, strategies,
predictions or any other statements relating to our future activities or other
future events or conditions. These statements are based on current expectations,
estimates and projections about our business based, in part, on assumptions made
by management. These statements are not guarantees of future performance and
involve risks, uncertainties and assumptions that are difficult to predict.
Therefore, actual outcomes and results may, and are likely to, differ materially
from what is expressed or forecasted in the forward-looking statements due to
numerous factors, including those described above and those risks discussed from
time to time in this prospectus, including the risks described under "Risk
Factors," and "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in this current report and in other documents which we
file with the Securities and Exchange Commission. In addition, such statements
could be affected by risks and uncertainties related to our ability to generate
business on an on-going business, to receive contract awards from the
competitive bidding process, maintain standards to enable us to manufacture
products to exacting specifications, enter new markets for our services, market
and customer acceptance, our ability to raise any financing which we may require
for our operations, competition, government regulations and requirements,
pricing and development difficulties, our ability to make acquisitions and
successfully integrate those acquisitions with our business, as well as general
industry and market conditions and growth rates, and general economic
conditions. Any forward-looking statements speak only as of the date on which
they are made, and we do not undertake any obligation to update any
forward-looking statement to reflect events or circumstances after the date of
this current report.

                                    BUSINESS

      We produce large metal fabrications and perform precision machining
operations for large military, commercial, nuclear, aerospace, shipbuilding and
industrial customers. Our principal services are large metal fabrications,
machining and engineering. Each of our contracts covers a specific product. We
fabricate nuclear grade steel casks, canisters and housings for the
transportation and storage of radioactive materials; we produce large
fabrications for Navy aircraft carriers, submarines and commercial vessels; and
we manufactures pulp and paper machinery, gas turbine power generation
equipment, oil refinery and utilities equipment. We are one of two companies
currently capable of machining one-piece aluminum domes for Boeing's Delta III
and Delta IV rocket programs. We do not mass-produce any products or distribute
such products on the open market.

      We perform most of our service pursuant to "build to print" contracts,
which means that we must manufacture products in accordance with very exacting
specification. These contracts are generally awarded in a bidding process.
Because of the nature of the products that we manufacture, there is a very low
tolerance for error. We will also help our clients to develop their projects by
providing engineering and research and development services. Periodically, we
will also perform research and development services for our customers as part of
a contract. However, the costs of such research and development work, is paid by
the customer. Through this periodic development work we may develop the
intellectual property to complete the project. In such cases when the work is
complete, we will own this intellectual property. However, we do not possess any
patents, trademarks, licenses, franchises, concessions or royalty agreements.


                                      -14-
<PAGE>

Products

      All of our products are built pursuant to contracts. Because we have
lifting capacity up to 100 tons, we have the ability to manufacture very large
products that must be fabricated in a single piece. The following are examples
of recent manufacturing contracts.

      We have been the sole source for a major defense contractor for the
manufacture of housings for the defense contractor's sonar system. This system
is currently being retro-fitted onto the Navy's entire fleet of Los Angeles
Class submarines. Future installations will go on Virginia Class and SSGN Class
submarines.

      We presently provides machining services to a division of another major
defense contractor. We produce primary shield tank heads, sonar system pods and
fairings, and a variety of miscellaneous components.

      One of our customers provides a complete nuclear waste storage system to
commercial nuclear power plants. We currently manufacture lifting equipment for
this company.

      Another customer is currently involved in a variety of commercial nuclear
reactor repair and overhaul projects. We manufactured several components needed
to support this work.

Source of Supply

      Our operations are partly dependent on the availability of raw materials.
The projects that we undertake are metal fabrications and machining of various
traditional and special alloys such as inconel, titanium and high tensile
strength steels, and the customer frequently provides us with the raw material.
Some of these materials selected for given projects require long lead times to
obtain. We have worked with a number of different metal suppliers over the years
to obtain these materials, and currently works with such raw material suppliers
as: Bethlehem Lukens Plate, Process Systems International and Joseph T Ryerson
and Sons. We have multi-year relationships with these suppliers. Although some
materials (due to their alloy compositions) require long lead times to obtain,
we have never experienced a shortage of any of these materials.

Marketing

      A significant portion of our contracts result from the competitive bidding
process, which are frequently limited to pre-qualified bidders. Most of our
sales inquiries are from existing customers. We have a marketing team of six,
including a sales manager and five technical personnel which markets our
services as well as our qualifications to both existing and potential customers
through personal contacts and trade shows. We also engage an independent sales
representative.


                                      -15-
<PAGE>

Principal Customers

      We do not have long-term contracts with any customer, and major contracts
with a small number of customers accounts for a significant percentage of our
revenue. Our customers include many of the major domestic defense and aerospace
companies. Because our services are rendered pursuant to separate contracts for
separate projects, our customer mix changes significantly from year to year. Two
customers accounted for more than 10% of our revenue in each of the nine months
ended December 31, 2005 and the fiscal years ended March 31, 2005 and 2004. Our
two largest customers for the nine months ended December 31, 2005 were the
University of Rochester, from which we recognized revenue of approximately $3.0
million (21.6% of revenue), and BAE Systems, from which we recognized revenue of
approximately $2.6 million (18.7%). For the year ended March 31, 2005, we
recognized revenue of approximately $2.7 million (18.8%) from Transnuclear, Inc.
and approximately $1.6 million (11.0%) from Battenfeld Gloucester Engineering,
Inc. For the year ended March 31, 2004, we recognized revenue of approximately
$2.3 million (21.1%) from Spincraft and approximately $1.8 million (16.9%) from
BAE Systems. No other customer accounted for 10% or more of our revenue in any
of those period.

Competition

      We face competition from a number of domestic and foreign manufacturers.
No one company dominates the industry, although many of our competitors are
larger, better known and have greater resources then we. Since many of our
contracts are awarded through a bidding process, our ability to win an award is
dependent upon a number of factors, including the price and our ability or
perceived ability to manufacture the products in accordance with specifications
and the customer's time requirements, for which our reputation as a quality
manufacturer is crucial. For certain products, being a domestic manufacturer may
be a factor. For other products, we may be undercut by foreign manufacturers who
have a lower cost of production. Further, to the extent that the bidding
proposal is based on specification which are provided by a competitor, we are at
a disadvantage in seeking to obtain that contract.

Government Regulations

      Although we do not have any contracts with government agencies, some of
our manufacturing services are provided as a subcontractor to a government
contractor. As a result, we are subject to government procurement and
acquisition regulations. Under these regulations, the government has the right
of termination for the convenience of the government and certain renegotiation
rights as well as a right of inspection. If a government review or investigation
uncovers improper or illegal activities, we may be subject to civil and criminal
penalties and administrative sanctions, including termination of contracts,
forfeiture of profits, suspension of payments and debarment from doing business
with federal government agencies. Some of the work we perform for our customers
are part of government appropriation packages, and therefore, subject to the
Miller Act, requiring the prime contractors (our customers) to pay all
subcontractors under contracted purchase agreements first.


                                      -16-
<PAGE>

Intellectual Property Rights

      We have no patent rights. In the course of our business we develop
proprietary know-how for use in the manufacturing process. Although we have
non-disclosure policies, we cannot assure you that we will be able to protect
our intellectual property rights.

Personnel

      We currently employ 140 employees, of which 19 are administrative, eight
are engineering and approximately 113 are manufacturing personnel. None of our
employees is represented by a labor union, and we believe that are employee
relations are good.

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

      You should read the following discussion together with Financial
Statements and pro forma financial statements that are filed as exhibits to this
current report on Form 8-K.

Overview

      We operate in one distinct business - fabrication, precision machining and
engineering of metal products up to 100 tons. Most of the products are
fabricated from raw metal plate or forgings. All materials used in the
manufacturing of our products are acquired from raw material suppliers we have
worked with for many years. Our clients are generally military, shipbuilding,
national laboratories and industrial companies. Payment terms associated with
each project often include progress payments and occasionally include deposits.
Generally, payment terms are 30 to 45 days from the invoice date. A majority of
the work we perform for our customers are generally part of government
appropriation packages, and therefore, subject to the Miller Act, requiring the
prime contractors (our customers) to pay all subcontractors under contracted
purchase agreements first. Our revenues therefore are quite secure. Our gross
margins are typical for the industry.

      These products are manufactured for our clients under a build-to-print
scenario. Work is performed by our personnel under firm contracted purchase
orders, for each project undertaken at the facility. Our work is contracted
under terms that require down payments for the acquisition of materials.
Additionally, depending on the length of a given project, some contracts require
progress payments based on major milestones of work completed.

      From June 1999 until 2002, Ranor's business was conducted by a subsidiary
of Standard Automotive Corporation. In December 2001, Standard filed for
protection under the Bankruptcy Code and operated under Chapter 11. We acquired
the Ranor assets from the bankruptcy estate. However, as a result of the
bankruptcy, our customers were initially reluctant to use our services. In
recent years, as both the market for our services has improved and we have
demonstrated to our customers that we have both the financial and manufacturing
ability to meet their specifications and time requirements, we have been able to
improve both our revenue and our gross margin.

Critical Accounting Policies

      The preparation of the Company's financial statements conform to the
generally accepted accounting principles in the United States and requires our
management to make assumptions, estimates and judgments that effect the amounts
reported in the financial statements, including all notes thereto, and related
disclosures of commitments and contingencies, if any. We rely on historical
experience and other assumptions we believe to be reasonable in making our
estimates. Actual financial results of the operations could differ materially
from such estimates. There have been no significant changes in the assumptions,
estimates and judgments used in the preparation of our audited financial
statements from the assumptions, estimates and judgments used in the preparation
of our 2004 audited financial statements.


                                      -17-
<PAGE>

Revenue Recognition

      We derive revenues from (i) the fabrication of large metal components for
our customers; (ii) the precision machining of such large metal components;
(iii) engineering services relating to the constructability of these products,
and (iv) the installation of such components at the customers' locations when
the scope of a given project requires such installations.

      Our cost containments system is set up to track our operations is the
"units of delivery method," otherwise known as "work in process" method.
Accordingly, income is recognized at the time at which a unit under contract is
completed and delivered to the customer. We have a firm purchase order or
contract for each project we undertake. Contracts for work to be performed are
negotiated per project and sometimes require a customer deposit to begin such
work. We generally use the customer's deposit to purchase the necessary raw
material for the project. Depending on the length of the project, we could
require progress payments based on milestones of completion as stipulated in the
contract. Such deposits and progress payments are treated as offsets to costs
incurred on uncompleted contracts.

Income Taxes

      Our fiscal year ends on March 31st. We provide for federal and state
income taxes currently payable, as well as those deferred because of temporary
differences between reporting income and expenses for financial statement
purposes versus tax purposes. Deferred tax assets and liabilities are recognized
for the future tax consequences attributable to differences between carrying
amount of assets and liabilities for financial reporting purposes and the
amounts used for income tax purposes. Deferred tax assets and liabilities are
measured using the enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be recoverable and or
settled. The effect of the change in the tax rates is recognized as income or
expense in the period of the change. A valuation allowance is established, when
necessary, to reduce deferred income taxes to the amount that is more likely
than not to be realized. As of March 31, 2005, we had net operating loss
carry-forwards approximating $3,470,000. Pursuant to Section 382 of the Internal
Revenue Code, utilization of these losses may be limited in the event of a
change in control, as defined in the Treasury Regulations. The change in
ownership resulting from our acquisition of Ranor will limit our ability to use
the loss carryforwards.

New Accounting Pronouncements

      In November 2004, the FASB issued SFAS No. 151 "Inventory Costs, an
amendment of Accounting Research Bulletin ("ARB") No. 43, Chapter 4." The
amendments made by Statement 151 clarify that, abnormal amounts of idle facility
expense, freight, handling costs and wasted materials (spoilage) should be
recognized as current-period charges and require the allocation of fixed
production overheads to inventory based on the normal capacity of the production
facilities. The guidance is effective for inventory costs incurred during the
fiscal years beginning after June 15, 2005.


                                      -18-
<PAGE>

      In December 2004, The FASB issued SFAS No. 153, "Exchanges of Nonmonetary
Assets, an amendment of APB Opinion No. 29, Accounting for Nonmonetary
Transactions" ("SFAS 153"). The amendments made by SFAS 153 as based on the
principle that exchanges of nonmonetary assets should be measured based on the
fair value of the assets exchanged. Further, the amendments eliminate the narrow
exception for nonmonetary exchanges of similar productive assets and replace it
with a broader exception for exchanges of nonmonetary assets that do not have
commercial substance. Previously, Opinion 29 required that the accounting for an
exchange of a productive asset should be based on the recorded amount of the
asset relinquished. Opinion 29 provided for an exception to its basic
measurement principle (fair value) for exchanges of similar productive assets.
The Board believes that exception required that some nonmonetary exchanges,
although commercially substantive, be recorded on a carry over basis. By
focusing the exception on exchanges that lack commercial substance, the Board
believes this Statement produces financial reporting that more faithfully
represents the economics of the transaction. The Statement is effective for
nonmonetary asset exchanges occurring in fiscal periods beginning after June 15,
2005. Earlier application is permitted for nonmonetary asset exchanges occurring
in fiscal periods beginning after the date of issuance. The provision of this
statement shall be applied prospectively.

      In December 2004, the FASB issued SFAS No.123 (revised 2004), "Share-Based
Payment." Statement 123R will provide investors and other users of financial
statements with more complete financial information by requiring that the
compensation cost relating to share-based payment transactions be recognized in
financial statements. That cost will be measured based on the fair value of the
equity or liability instruments issued. Statement 123R covers a wide range of
share-based compensation arrangements including stock options, restricted stock
plans, performance-based awards, stock appreciation rights, and employee stock
purchase plans. Statement 123R replaces FASB Statement No. 123, Accounting for
Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for
Stock Issued to Employees. Statement 123, as originally issued in 1995,
established as preferable a fair-value-based method of accounting for
share-based payment transactions with employees. However, that statement
permitted entities the option of continuing to apply the guidance in Opinion 25,
as long as the footnotes to financial statements disclosed what net income would
have been had the preferable fair-value-based method been used. Public entities
that are small business issuers will be required to apply Statement 123R as of
the first interim or annual reporting period that begins after December 15,
2005, which, for us, will be the quarter beginning April 1, 2006. Prior to the
reverse acquisition, we did not grant any options or equity-based incentives. To
the extent that we grant such options or other equity-based incentives, the
value thereof will be included an a general and administrative expense.

      We expect that the adoption of the foregoing new statements will not have
a significant impact on our financial statements.

Results of operations

      The following table sets forth our statements of operations for the nine
months ended December 31, 2005 and 2004 and the years ended March 31, 2005 and
2004, as a percentage of revenue:


                                      -19-
<PAGE>

<TABLE>
<CAPTION>
                                                              Nine Months Ended December 31,        Fiscal Year Ended March 31,
                                                              ------------------------------        ---------------------------
                                                                     2005              2004            2005           2004
                                                                     ----              ----            ----           ----
<S>                                                                <C>               <C>             <C>            <C>
Sales                                                              100.0%            100.0%          100.0%         100.0%
Cost of sales(1)                                                    83.8%             88.6%           85.7%          89.2%
Gross profit                                                        16.2%             11.4%           14.3%          10.8%
Selling, general and administrative costs                           10.4%             11.6%           11.7%          11.9%
Earnings before interest, taxes, depreciation,                       5.8%             -0.2%            2.7%          -4.7%
amortization and cumulative change in accounting
principle
Interest expense (net)                                               6.1%              7.9%            7.8%           9.9%
Depreciation                                                         2.3%              2.9%            2.9%           3.6%
Cumulative effect of change in accounting                              0%                0%              0%           0.5%
principle
Income taxes                                                            *                 *               *              *
Net income                                                          -2.5%            -11.0%           -8.0%         -18.8%
</TABLE>

*        Less than 0.5%

(1) Cost of sales does not include depreciation or amortization.

Nine Months Ended December 31, 2005 and 2004

      Sales in the nine months ended December 31, 2005 (the "December 2005
period") increased $3,175,471, or 30%, to $13,713,739, compared to $10,538,268
for the nine months ended December 31, 2004 (the "December 2004 period"). This
increase reflected both an improvement in the market for our services following
a downturn in this market in response to the events of September 11, 2001 and a
continued acceptance of us as a supplier following the bankruptcy of Standard
Automotive.

      Our cost of sales for the December 2005 period increased $1,852,404, to
$11,494,666, an increase of 19%, from $9,642,262 in the December 2004 period.
This increase was significantly less than the increase in sales, resulting in an
improvement in the gross margin from 8.5% to 16.2%. The increase resulted from
more efficient operations. In the December 2004 period, we were not able to
utilize our manufacturing personnel efficiently, since we were staffed to
manufacture more products than we had orders. As a result, our direct labor, as
a percentage of sales, decreased from 23.7% to 19.7%.

      Selling, administrative and other expenses for the December 2005 period
were $1,421,605, compared to $1,220,311 for the first nine months of 2004, an
increase of $201,294, or 16%. Significant components of selling, general and
other expenses for the December 2005 period includes $1,080,085 of salaries and
related payroll taxes, $53,935 of travel and entertainment expenses and $65,445
for legal, consulting and accounting fees. The increase in selling, general and
administrative also reflected payroll costs resulting, in part, from the
employment of one of the former Ranor stockholders as our president.

      The Company's interest expense during the December 2005 period was
$840,849 compared to $841,065 for the December 2004 period.


                                      -20-
<PAGE>

      As a result of the foregoing, our net loss for the December 2005 period
was $347,870, as compared to a loss of $1,163,678 for the December 2004 period.

Fiscal Years Ended March 31, 2005 and 2004

      Sales for the fiscal year ended March 31, 2005 ("fiscal 2005") increased
$3,337,065, or 31%, to $14,269,982, compared to $10,932,917 for the fiscal year
ended March 31, 2004 ("fiscal 2004"). This increase, like the increase in sales
for the December 2005 period, reflected both an improvement in the market for
our services following a downturn in this market in response to the events of
September 11, 2001 and a greater acceptance of us as a supplier following the
bankruptcy of Standard Automotive.

      Our cost of sales for fiscal 2005 period increased $2,483,370, or 24%,
from 10,148,270 to 12,631,640. This increase was less than the increase in
sales, resulting in an improvement in the gross margin from 7.2% to 11.5%. The
increase resulted from more efficient operations, although we continued to have
operating inefficiencies during fiscal 2004 as a result of our level of sales.
As a result, our direct labor, as a percentage of sales, decreased from 25.71%
to 21.83%

      Selling, administrative and other expenses for fiscal 2005 were
$1,664,847, compared to $1,691,748 for fiscal 2004, a decease of $26,901, or 2
%. Significant components of selling, general and other expenses for the fiscal
2005 period include $1,203,273 of salaries and related payroll taxes, $32,748 of
travel and entertainment expenses and $169,390 for legal, consulting and
accounting fees.

      The Company's interest expense was unchanged from fiscal 2004 to fiscal
2005.

      During fiscal 2004 we had an accounting change related to the manner in
which we recognize revenue in the amount of $56,142. There was no comparable
charge in fiscal 2005.

      As a result of the foregoing, our net loss for fiscal 2005 was $1,143,800,
as compared to a loss of $2,055,304 for fiscal 2004.

Liquidity and Capital Resources

      At December 31, 2005, we had working capital of approximately $3,316,050,
including $777,950 of cash. Pursuant to the Ranor Agreement, which was closed on
February 24, 2006, we were required to pay the former stockholders of Ranor an
amount equal to our cash position in excess of $250,000. We also paid $240,000
of the remaining cash as part of the purchase price due to the former
stockholders, which reduced our cash balance to $10,000. The total amount paid
to the former Ranor stockholders was $1,053,000, comprised of $813,000, being
the cash in excess of $250,000, and $240,000, being a payment from the remaining
cash.

      In the December 2005 period, we had negative cash flow from operations of
$363,965, which is a significant improvement from a negative cash flow from
operations of $900,595 for the year ended March 31, 2005. We attribute this
improvement to our ability to increase both our revenue and gross margin in the
December 2005 period as described under "Results of Operations." However, as a
result of the reverse acquisition, we have additional expenses, including
$200,000 pursuant to a management agreement with Techprecision, as well as
additional expenses which we will incur as a public company. Offsetting these
cost increases is the elimination of compensation that was paid to the former
stockholders of Ranor.


                                      -21-
<PAGE>

      In the normal course of our business, we required funds to enable us to
complete our contracts. While we generally receive a deposit, we typically use
that deposit to purchase raw materials required for the contract, and fund our
operations from working capital. Contemporaneously with the reverse acquisition,
we entered into an agreement with Sovereign Bank pursuant to which we borrowed
$4,000,000 on a term loan basis, and we obtained a $1,000,000 revolving credit
facility. We used the net proceeds from the $4,000,000 term loan to pay a
portion of our obligations to the former Ranor stockholders under the Ranor
Agreement. While we believe that the $1,000,000 revolving credit facility and
our cash flow from our operations should be sufficient to enable us to satisfy
our cash requirements at least through the end of 2006, it is possible that we
may require additional funds. We have no commitment from any party for
additional funds, and the terms of our agreement with Barron Partners may impair
our ability to raise capital in the equity markets.

Item 3. Description of Property.

      We lease from WM, an approximately 136,000-square foot office and
manufacturing facility at One Bella Drive, Westminster, Massachusetts 01473,
pursuant to a 15-year lease that expires February 28, 2021, at an annual rental
of $438,000, subject to annual escalations. The lease provides for two five-year
extension and a purchase option at appraised value. We sold the real estate to
WM contemporaneously with the reverse acquisition for $3.0 million. In
connection with WM's financing of the real estate, we agreed to an increase in
the rental in the event of a default by WM under its mortgage.

Item 4. Security Ownership of Certain Beneficial Owners and Management.

      The following table provides information as to shares of common stock
beneficially owned as of February 28, 2006 by:

      o     each director;

      o     each officer named in the summary compensation table;

      o     each person owning of record or known by us, based on information
            provided to us by the persons named below, to own beneficially at
            least 5% of our common stock; and

      o     all directors and executive officers as a group.

                                      Shares of Common Stock
Name                                       Beneficially Owned      Percentage
----                                       ------------------      ----------

James G. Reindl                                     2,945,300           29.6%
One Bella Drive
Westminster, MA 01473

Andrew A. Levy                                      2,925,300           29.3%
900 Third Avenue
New York, New York 10022

Stanoff Corporation                                 1,700,000           17.1%
805 Third Avenue
New York, NY 10022


                                      -22-
<PAGE>

Robert Lifton                                       1,000,000           10.0%
805 Third Avenue
New York, NY 10022

Howard Weingrow                                     1,000,000           10.0%
805 Third Avenue
New York, NY 10022

Stanley A. Youtt                                      796,000            8.0%
One Bella Drive
Westminster, MA 01473

Martin M. Daube                                       741,400            7.4%
20 West 64th Street
New York, NY 10023

Larry Steinbrueck                                     204,000            2.0%

Michael Holly                                          85,000               *

Louis A. Winoski                                          -0-             -0-

All officers and directors as a group (five         4,040,300           40.5%
individuals owning stock)

*     Less than 1%

      Except as otherwise indicated each person has the sole power to vote and
dispose of all shares of common stock listed opposite his name. Each person is
deemed to own beneficially shares of common stock which are issuable upon
exercise or warrants or options or upon conversion of convertible securities if
they are exercisable or convertible within 60 days of February 28, 2006.

      The shares owned by Andrew A. Levy represent 2,675,300 shares of common
stock owned by him and 250,000 shares of common stock owned by Redstone Capital
Corporation, of which Mr. Levy is president and sole stockholder.

      Robert Lifton and Howard Weingrow each own a 50% interest in Stanoff
Corporation. The 1,000,000 shares of common stock beneficially owned by each of
them represents 150,000 shares of common stock owned in his individual name and
50% of the 1,700,000 shares of common stock owned by Stanoff Corporation.

      Stanley A. Youtt has an agreement with Mr. Levy, Mr. Reindl and Mr. Daube
pursuant to which they will transfer to Mr. Youtt an aggregate of 796,000 shares
of common stock in the event that we do not make an acquisition meeting certain
agreed-upon criteria within one year from February 24, 2006, the date we
acquired Ranor.

      Barron Partners owns shares of series A preferred stock and warrants
which, if fully converted or exercised, would result in ownership of more than
5% of our outstanding common stock. However, the series A preferred stock may
not be converted and the warrants may not be exercised if such conversion would
result in Barron Partners owning more than 4.9% of our outstanding common stock.
This limitation may not be waived. As a result, Barron Partners does not
beneficially own 5% or more of our common stock.


                                      -23-
<PAGE>

Item 5. Directors and Executive Officers, Promoters and Control Persons.

Directors and Executive Officers

       Name             Age       Position
James G. Reindl         47        Chairman and chief executive officer
Mary Desmond            42        Chief financial officer and secretary
Stanley A. Youtt        59        Director; president and chief executive
                                   officer of Ranor
Michael Holly(1)        59        Director
Larry Steinbrueck(1)    54        Director
Louis A. Winoski(1)     59        Director

(1)   Member of the audit and compensation committees.

      Mr. Reindl has been a director, chairman and chief executive officer since
February 2006. Mr. Reindl is president of Techprecision, LLC, a company that was
formed in 2002 to acquire, manage and develop smaller to mid-sized companies in
the aerospace, military and precision manufacturing industry sectors.
Techprecision has a management agreement with us, and Mr. Reindl devotes
substantially all of his business time and attention to our business. From
February 1999 until February 2002, Mr. Reindl was president and chief executive
officer of Critical Components Corporation, an aerospace subsidiary of Standard
Automotive Corporation. During that period, Ranor was a wholly-owned subsidiary
of Critical Components. Mr. Reindl received his Bachelor of Science degree in
mechanical aerospace engineering from the University of Delaware.

      Ms. Desmond has been our chief financial officer since February 2006, and
she has been the chief financial officer of Ranor since 1998. Ms. Desmond
obtained her Bachelor of Science degree in accounting from Franklin Pierce
College and she received her Masters of Business (MBA) from Fitchburg State
College.

      Mr. Youtt has been a director since March 2006, and he has been chief
executive officer of Ranor since 2000. Mr. Youtt received a Bachelor of Science
degree in naval architecture and marine engineering from the University of
Michigan and Masters Degree in civil engineering (applied mechanics) from the
University of Connecticut.

      Mr. Holly has been a director since March 2006. Since 2004, Mr. Holly has
been a private investor and consultant. From 1996 until 2004, Mr. Holly was
managing director of Safeguard International Fund, L.P., a private equity fund
of which Mr. Holly is a founding partner. Mr. Holly has a Bachelor of Science
degree in economics from Mount St. Mary's College.

      Mr. Steinbrueck has been a director since March 2006. Since 1991, Mr.
Steinbrueck has been president of MidWest Capital Group, an investment banking
firm. Mr. Steinbrueck has a Bachelor of Science degree in business and a Masters
in Business Administration from the University of Missouri.

      Mr. Winoski has been a director since March 2006. Since August 2005, Mr.
Winoski has been a consultant to Garner CAD Technic GmbH, an aerospace
engineering and design services company. From August 2004 to August 2005, Mr.
Winoski was managing director, chairman of the board and member of the holding
company board for RSM Fabrications Ltd., a fabricator of aerospace products.
From March 2002 until July 2004, Mr. Winoski was a consultant and director of
global marketing for PFW GmbH, a producer of components for commercial aircraft.
From December 1999 to February 2002, Mr. Winoski was president and chief
executive officer of Tubetronics Inc., a producer of spare parts for Boeing
commercial aircraft and other aerospace products. Mr. Winoski is also managing
partner of Homeric Partners, LLC, a management consulting business. Mr. Winoski
has a Bachelor of Science degree in industrial and systems management
engineering from Pennsylvania State University.


                                      -24-
<PAGE>

Board Committees

         The board of directors has two committees, the audit committee and the
compensation committee. Michael Holly, Larry Steinbrueck and Louis Winoski, each
of whom is an independent director, are the members of both committees. Mr.
Holly is the audit committee financial expert.

Item 6.  Executive Compensation.

                           SUMMARY COMPENSATION TABLE

         Prior to the reverse merger, we did not pay any compensation to any
executive officers. Set forth below is information for the fiscal year ended
March 31, 2005 for Ranor's chief executive officer and for our other executive
officers whose salary for the fiscal year was at least $100,000.

                                                                      Other
Name and Position                          Year        Salary     Compensation
-----------------                          ----        ------     ------------
Stanley A. Youtt, chief executive          2005      $198,016              -0-
officer
Jeffrey Lippincott, Secretary              2005       150,000              -0-
Daniel Justicz, Treasurer                  2005       150,000              -0-

      Mr. Lippincott and Mr. Justicz are former stockholders of Ranor and are no
longer employed by us or Ranor.

Employment Agreement

      In February 2006, Ranor entered into an employment agreement with Stanley
A. Youtt pursuant to which he would serve as our chief executive officer for a
term of three year term ending on February 28, 2009. Pursuant to the agreement,
we pay Mr. Youtt salary at the annual rate of $200,000. Mr. Youtt is also
eligible for performance bonuses based on financial performance criteria set by
the board. In the event that we terminate Mr. Youtt's employment without cause,
we are required to make a lump-sum payment to him equal to his base compensation
for the balance of the term and to provide the insurance coverage that we would
provide if he remained employed.

Management Agreement

      Pursuant to a management agreement with Techprecision LLC, we engaged
Techprecision to manage our business through March 31, 2009. The agreement
provides that we pay Techprecision an annual management fee of $200,000 and a
performance bonus based on criteria determined by the compensation committee.
Mr. Reindl is the manager of Techprecision, and he, Andrew A. Levy and Martin M.
Daube are the members of Techprecision. The agreement provides that
Techprecision will provide the services of Mr. Reindl at chairman, Mr. Levy for
marketing support and analysis of long-term contracts and Mr. Daube for
marketing support. None of the members of Techprecision receive any additional
compensation from us.


                                      -25-
<PAGE>

2006 Long-Term Incentive Plan

      In February 2006, we adopted, subject to stockholder approval, the 2006
long-term incentive plan covering 1,000,000 shares of common stock. The plan
provides for the grant of incentive and non-qualified options, stock grants,
stock appreciation rights and other equity-based incentives to employees,
including officers, and consultants. The 2006 Plan is to be administered by a
committee of not less than two directors each of which is to be an independent
directors. In the absence of a committee, the plan is administered by the board
of directors. Independent directors are not eligible for discretionary options.
However, each newly elected independent director receives at the time of his
election, a five-year option to purchase 25,000 shares of common stock at the
market price on the date of his or her election. In addition, the plan provides
for the annual grant of an option to purchase 5,000 shares of common stock on
July 1st of each year, commencing July 1, 2007. Pursuant to this plan, we
granted incentive stock options to our three independent directors -- Michael
Holly, Larry Steinbrueck and Louis Winoski. The options are subject to
stockholder approval of the 2006 Plan.

      We also have reserved 133,000 shares of common stock for issuance to key
managerial employees as restricted stock grants.

Item 7. Certain Relationships and Related Transactions.

      In connection with the reverse acquisition, we sold the real property on
which our facilities are located to WM for $3.0 million. WM is a special purpose
entity which was created in order to acquire the real estate. WM is beneficially
owned by Newvision Westminster LLC, of which Andrew A. Levy, a principal
stockholder and a member of Techprecision, is the manager and a 69% beneficial
owner. Mr. James G. Reindl, our chairman, chief executive officer and a
director, is a 10% beneficial owner of Newvision. Larry Steinbreuck and Michael
Holly, who are directors, own 1.2% and 0.5% respectively. Other principal
stockholders who are members of Newvision are Stanoff Corporation (10%) and
Martin Daube (7.8%). The property that we sold includes the real estate on which
our facilities are located and three potential residential lots, which are
presently vacant. We lease the real estate on which our facilities are located
(and not the potential residential lots) pursuant to a triple net lease at an
current annual rental of $438,000, subject to escalation. See "Item 3.
Description of Property" for information relating to this lease. Although we
believe that the terms of the sale and the lease are fair to us, the purchase
price is less than the appraised value of the property and the terms of neither
the sale nor the lease were negotiated at arms length. The purchase price was
based largely upon the maximum amount that WM could borrow and reflected the
fact that the use of the real estate as a manufacturing facility would not be
considered the best use of the property.

      In connection with the mortgage on the real estate, Mr. Levy and Mr.
Reindl gave the mortgagee their personal limited guarantee and an environmental
guaranty. The limited guaranty is triggered by certain defaults by WM under its
mortgage.


                                      -26-
<PAGE>

      In connection with the mortgage, we paid certain of WM's costs and
expenses of approximately $150,000, which amount is payable by WM within three
years.

      Prior to the completion of the reverse acquisition, Techprecision advanced
us $120,000 for expenses relating to the reverse acquisition. These expenses
were paid in February 2006.

      Mr. Stanley A. Youtt was a common stockholder of Ranor. Pursuant to the
Ranor Agreement, he, along with the other former Ranor stockholders, sold his
Ranor stock to us. Since the consideration paid was used to pay debt and the
preference of the preferred stockholders, the total amount paid to Mr. Youtt was
$700.

Item 8. Description of Securities.

      We are authorized to issue 90,000,000 shares of common stock, par value
$.0001 per share, and 10,000,000 shares of preferred stock, par value $.0001 per
share. As of February 28, 2006, we had we 17,686,259 shares of common stock and
7,719,250 shares of series A preferred stock outstanding.

      The following summary of certain provisions of our common stock, preferred
stock, certificate of incorporation and by-laws is not intended to be complete.
It is qualified by reference to the provisions of applicable law and to our
certificate of incorporation and by-laws.

Common Stock

      Holders of common stock are entitled to one vote for each share held on
all matters submitted to a vote of stockholders and do not have cumulative
voting rights. Accordingly, holders of a majority of the shares of common stock
entitled to vote in any election of directors may elect all of the directors
standing for election. Holders of common stock are entitled to receive
proportionately any dividends as may be declared by our board of directors,
subject to any preferential dividend rights of outstanding preferred stock.
Pursuant to the certificate of designation relating to the series A preferred
stock, we are prohibited from paying dividends on our common stock while the
preferred stock is outstanding. Upon our liquidation, dissolution or winding up,
the holders of common stock are entitled to receive proportionately our net
assets available after the payment of all debts and other liabilities and
subject to the prior rights of any outstanding preferred stock. Holders of
common stock have no preemptive, subscription, redemption or conversion rights.
Our outstanding shares of common stock are fully paid and non-assessable. The
rights, preferences and privileges of holders of common stock are subject to,
and may be adversely affected by, the rights of the holders of shares of any
series of preferred stock that we may designate and issue in the future.

Preferred Stock

      Our certificate of incorporation gives our board of directors the power to
issue shares of preferred stock in one or more series without stockholder
approval. Our board of directors has the discretion to determine the rights,
preferences, privileges and restrictions, including voting rights, dividend
rights, conversion rights, redemption privileges and liquidation preferences, of
each series of preferred stock. The purpose of authorizing our board of
directors to issue preferred stock and determine its rights and preferences is
to eliminate delays associated with a stockholder vote on specific issuances.
The issuance of preferred stock, while providing desirable flexibility in
connection with possible acquisitions and other corporate purposes, could have
the effect of making it more difficult for a third party to acquire, or could
discourage a third party from acquiring, a majority of our outstanding voting
stock. Except for the series A preferred stock, we have no present plans to
issue any shares of preferred stock.


                                      -27-
<PAGE>

Series A Preferred Stock

      The certificate of designation for the series A preferred stock provides
that:

      o     Each share of series A preferred stock is convertible into two
            shares of common stock.

      o     If, while Barron Partners owns shares of series A preferred stock,
            we issues common stock at a price, or options, warrants or other
            convertible securities with a conversion or exercise price less than
            the conversion price (initially $.285 per share), with certain
            specified exceptions, the number of shares issuable upon conversion
            of one share of series B preferred stock is adjusted to reflect a
            conversion price equal to the lower price.

      o     If our earnings before interest, taxes, depreciation and
            amortization, computed as provided in the Preferred Stock Agreement
            ("EBITDA") per share for the fiscal year ended March 31, 2006, are
            less than $0.06591 per share, the conversion price shall be reduced
            proportionately by up to 15%. The full 15% adjustment will be made
            if EBITDA per share is $.04613 or less.

      o     If our EBITDA per share for the fiscal year ended March 31, 2007,
            are less than $.08568 per share, the conversion price shall be
            reduced proportionately by up to 15%. The full 15% adjustment will
            be made if EBITDA per share is $.05997 or less.

      o     No dividends are payable with respect to the series A preferred
            stock.

      o     While the series A preferred stock is outstanding, we may not pay
            dividends on or redeem shares of common stock.

      o     Upon any voluntary or involuntary liquidation, dissolution or
            winding-up, the holders of the series A preferred stock are entitled
            to a preference of $.285 per share before any distributions or
            payments may be made with respect to the common stock or any other
            class or series of capital stock which is junior to the series A
            preferred stock upon voluntary or involuntary liquidation,
            dissolution or winding-up.

      o     The holders of the series A preferred stock have no voting rights.
            However, so long as any shares of series A preferred stock are
            outstanding, we shall not, without the affirmative approval of the
            holders of 75% of the outstanding shares of series A preferred stock
            then outstanding, (a) alter or change adversely the powers,
            preferences or rights given to the series A preferred stock or
            alter, (b) authorize or create any class of stock ranking as to
            dividends or distribution of assets upon liquidation senior to or
            otherwise pari passu with the series A preferred stock, or any of
            preferred stock possessing greater voting rights or the right to
            convert at a more favorable price than the series A preferred stock,
            (c) amend its certificate of incorporation or other charter
            documents in breach of any of the provisions hereof, (d) increase
            the authorized number of shares of series A preferred stock, or (e)
            enter into any agreement with respect to the foregoing.


                                      -28-
<PAGE>

      o     The holders of the series A preferred stock may not convert the
            series A preferred stock to the extent that such conversion would
            result in the holders owning more than 4.9% of the outstanding
            Common Stock. This limitation may not be amended or waived.

Proposed Amendment to our Certificate of Incorporation

      Pursuant to the Preferred Stock Agreement with Barron Partners, our board
of directors approved, and authorized the submission to stockholders at the next
annual or special meeting, an amendment to our certificate of incorporation to
add the following provision:

      "The terms and conditions of any rights, options and warrants approved by
the Board of Directors may provide that any or all of such terms and conditions
may be waived or amended only with the consent of the holders of a designated
percentage of a designated class or classes of capital stock of the Corporation
(or a designated group or groups of holders within such class or classes,
including but not limited to disinterested holders), and the applicable terms
and conditions of any such rights, options or warrants so conditioned may not be
waived or amended absent such consent."

Delaware Law and Certain Charter and By-law Provisions

      We are subject to the provisions of Section 203 of the Delaware General
Corporation Law statute. Section 203 prohibits a publicly-held Delaware
corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years after the person became an interested
stockholder, unless the business combination is approved in a prescribed manner.
A "business combination" includes mergers, asset sales and other transactions
resulting in a financial benefit to the interested stockholder. Subject to
certain exceptions, an "interested stockholder" is a person who, together with
affiliates and associates, owns, or within the prior three years did own, 15% or
more of the corporation's voting stock.

      Our certificate of incorporation contains certain provisions permitted
under Delaware General Corporation Law relating to the liability of directors.
The provisions eliminate a director's liability for monetary damages for a
breach of fiduciary duty, except in certain circumstances where such liability
may not be eliminated under applicable law. Further, our certificate of
incorporation contains provisions to indemnify our directors and officers to the
fullest extent permitted by Delaware General Corporation Law.

                                     PART II

Item 1. Market Price of and Dividends on the Registrant's Common Equity and
Related Stockholder Matters.

      There is no public marker for our common stock, and we have not paid
dividends. Our agreement with Barron Partners and the certificate of designation
relating to the series A preferred stock prohibit our payment of dividends while
shares of series A preferred stock are outstanding.

      As of February 28, 2006, we had approximately 50 stockholders of record.
At that date, we had 17,686,259 shares of common stock outstanding, none of
which may be sold pursuant to Rule 144. The 100,000 shares that were outstanding
prior to the reverse acquisition were issued at a time when we were a shell
company, and those shares, under an interpretation from the SEC relating to
shares issued by a shell company, may not be sold pursuant to Rule 144, and must
be registered for sale.


                                      -29-
<PAGE>

      As of February 28, 2006, we had the following shares of common stock
reserved for issuance:

      o     7,719,250 shares issuable upon conversion of the series A preferred
            stock.

      o     11,220,000 shares issuable upon exercise of the warrants issued to
            Barron Partners.

      o     1,000,000 shares issuable upon exercise of stock options or other
            equity-based incentives pursuant to our 2006 long-term incentive
            plan, which is subject to stockholder approval.

      o     133,000 shares to be issued as restricted stock grants to key
            employees.

Equity Compensation Plan Information

      The following table summarizes the equity compensation plans under which
our securities may be issued as of February 28, 2006.

<TABLE>
<CAPTION>
                                           Number of securities to be     Weighted-average          Number of securities
                                           issued upon exercise of        exercise price of         remaining available for
                                           outstanding options and        outstanding options and   future issuance under
      Plan Category                        warrants                       warrants                  equity compensation plans
      -------------                        --------                       --------                  -------------------------
<S>                                           <C>                            <C>                      <C>
Equity compensation plans approved by            -0-                                --                          --
security holders

Equity compensation plan not approved by      75,000                         $.285                    1,208,000
security holders
</TABLE>

      The 2006 long-term incentive plan was approved by the board of directors,
subject to stockholder approval, and the outstanding options are subject to
stockholder approval of the plan. The plan has not yet been submitted to the
stockholders for their approval. We also have a plan for the issuance of 133,000
shares of commons stock to key employees as restricted stock grant.

Item 2. Legal Proceedings.

      We are not a defendant in any material legal proceedings.

Item 3. Changes in and Disagreements with Accountants.

      See Item 4.01 of this Form 8-K for information relating to the change in
our independent accountants.


                                      -30-
<PAGE>

Item 4. Recent Issuances of Unregistered Securities.

      See Item 3.02 of this Form 8-K for information relating to recent
issuances of unregistered securities.

Item 5. Indemnification of Officers and Directors.

      Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses including attorneys' fees, judgments, fines and
amounts paid in settlement in connection with various actions, suits or
proceedings, whether civil, criminal, administrative or investigative other than
an action by or in the right of the corporation, a derivative action, if they
acted in good faith and in a manner they reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, if they had no reasonable cause to believe their
conduct was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses including
attorneys' fees incurred in connection with the defense or settlement of such
actions, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's certificate of
incorporation, bylaws, agreement, a vote of stockholders or disinterested
directors or otherwise.

      Our Certificate of Incorporation provides that we will indemnify and hold
harmless, to the fullest extent permitted by Section 145 of the Delaware General
Corporation Law, as amended from time to time, each person that such section
grants us the power to indemnify.

      The Delaware General Corporation Law permits a corporation to provide in
its certificate of incorporation that a director of the corporation shall not be
personally liable to the corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, except for liability for any breach
of the director's duty of loyalty to the corporation or its stockholders; acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law; payments of unlawful dividends or unlawful stock
repurchases or redemptions, or any transaction from which the director derived
an improper personal benefit.

      Our certificate of incorporation provides that, to the fullest extent
permitted by applicable law, none of our directors will be personally liable to
us or our stockholders for monetary damages for breach of fiduciary duty as a
director. Any repeal or modification of this provision will be prospective only
and will not adversely affect any limitation, right or protection of a director
existing at the time of such repeal or modification.

      Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers and controlling persons pursuant
to the foregoing provisions, or otherwise, we have been advised that in the
opinion of the SEC such indemnification is against public policy as expressed in
the Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than director, officer or
controlling person in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with
the securities being registered, we will, unless in the opinion of our counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by us is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.


                                      -31-
<PAGE>

                                    PART F/S

      Reference is made to the filings by Lounsberry on Form 10SB-A and 10-QSB
for Lounsberry's financial statements.

      The financial statements of Ranor begin on Page F-1.

      The pro forma financial information is filed as Exhibit 99.X to this Form
8-K.

                                    PART III

      The exhibits are listed and described in Item 9.01 of this Form 8-K.

Item 3.02. Unregistered Sale of Equity Securities.

      In January 2006, we sold 8,000 shares of common stock to 40 investors in a
private placement, from which we received proceeds of $2,000.

      On February 24, 2006, we issued the following securities:

      o     Pursuant to the Preferred Stock Agreement, we sold to Barron
            Partners for $2,200,000, (i) 7,719,250 shares of series A preferred
            stock, and (ii) warrants to purchase 11,220,000 shares of common
            stock, of which warrants to purchase 5,610,000 shares have an
            exercise price of $.55 per share, warrants to purchase 5,610,000
            shares have an exercise price of $.855 per share.

      o     Pursuant to the Acquisition Company Agreement, we issued to the
            former members of Ranor Acquisition an aggregate of 7,697,000 shares
            of common stock.

      o     Pursuant to a subscription agreement, we issued 1,700,000 shares of
            common stock for $500,000.

      o     Pursuant to restricted stock agreements, we issued 470,000 shares of
            common stock to six accredited investors, for services rendered.

      No broker was involved in connection with any of the foregoing
transactions.

      The foregoing issuances were exempt from registration pursuant to Section
4(2) of the Securities Act and Regulation D of the SEC thereunder.

      The conversion rights of the holders of the series A preferred stock are
described in "Item 2.01. Completion of Acquisition or Disposition of Assets"
under "Item 8. Description of Securities."

      The rights of the holders of the warrants are described "Item 1.01. Entry
into a Material Definitive Agreement."


                                      -32-
<PAGE>

Item 5.01 Changes of Control of Registrant.

      The reverse merger with Ranor resulted in a change of control. For
information concerning our current officers and directors, see "Item 5.
Directors and Executive Officers, Promoters and Control Persons" under "Item
2.01. Completion of Acquisition or Disposition of Assets." For information on
stock holdings by our officers, directors and principal stockholders, see "Item
4. Security Ownership of Certain Beneficial Owners and Management" under "Item
2.01. Completion of Acquisition or Disposition of Assets."

      The current directors and officers were elected in connection with the
reverse acquisition.

Item 5.02. Departure of Directors or Principal Officers; Election of Directors;
Appointment of Principal Officers.

      If February 2006, we elected our present directors and officers.
Information concerning our officers and directors is disclosed in "Item 5.
Directors and Executive Officers, Promoters and Control Persons" under "Item
2.01. Completion of Acquisition or Disposition of Assets."

Item 5.03. Amendment to Certificate of Incorporation or Bylaws; Change in Fiscal
Year.

      On February 24, 2006, we filed a certificate of designation setting forth
the rights, preferences, privileges and limitations of the holders of our series
A preferred stock. See the caption "Series A Preferred Stock" in "Item 8.
Description of Securities" under "Item 2.01. Completion of Acquisition or
Disposition of Assets" for information concerning the rights of the holders of
the series A preferred stock.

      On February 24, 2006, our board of directors has approved, subject to
stockholder approval, an amendment to our certificate of incorporation to
include the following provision:

      "The terms and conditions of any rights, options and warrants approved by
the Board of Directors may provide that any or all of such terms and conditions
may be waived or amended only with the consent of the holders of a designated
percentage of a designated class or classes of capital stock of the Corporation
(or a designated group or groups of holders within such class or classes,
including but not limited to disinterested holders), and the applicable terms
and conditions of any such rights, options or warrants so conditioned may not be
waived or amended absent such consent."

      On March 2, 2006, we changed our fiscal year to the fiscal year ended
March 31. The change in fiscal year will be reflected in our Form 10-KSB for the
fiscal year ended March 31, 2006. The change of fiscal year results from our
acquisition of Ranor in February 2006 in a transaction accounted for as a
reverse acquisition. As a result, Ranor is the accounting acquiring entity, and
our historical financial statements will reflect the operations of Ranor, as if
Ranor had made the acquisition. We will also file a Form 10-KSB for the year
ended December 31, 2005 which will include the audited financial statements for
our business as it existed at December 31, 2005. The audited financial
statements for Ranor for the fiscal years ended March 31, 2005 and 2004 and the
unaudited financial statements for Ranor for the nine months ended December 31,
2005 and 2004 are included in this Form 8-K.

Section 5.06 Change in Shell Company Status.

      As a result of the reverse merger with Ranor, we are no longer a shell
company.

      See "Item 1.01 Entry into a Material Definitive Agreement" for information
relating to the agreements pursuant to which the reverse merger was consummated
and financed and "Item 2.01 Completion of Acquisition or Disposition of Assets"
for a description of our business following the completion of the reverse
merger.

Item 9.01 Financial Statements and Exhibits.

      (a)   Financial statements of Ranor. See Page F-1.

      (b)   Pro forma financial information. See Exhibit 99..


                                      -33-
<PAGE>

      (c)   See (a) and (b) of this Item 9.01.

      (d)   Exhibits

      2.1   Stock purchase agreement
      3.1   Certificate of Designation for the Series A Convertible Preferred
            Stock
      4.1   Loan and security agreement dated February 24, 2006, between Ranor
            and Sovereign Bank
      4.2   Guaranty from the Registrant to Sovereign Bank
      4.3   Form of warrant issued to Barron Partners LP
     99.1   Preferred stock purchase agreement dated February 24, 2006, between
            the Registrant and Barron Partners, LP
     99.2   Registration rights agreement dated February 24, 2006, between the
            Registrant and Barron Partners LP
     99.3   Agreement dated February 24, 2006, among the Registrant, Ranor
            Acquisition LLC and the members of Ranor Acquisition LLC.
     99.4   Subscription Agreement dated February 24, 2006
     99.5   Registration rights provisions pursuant to the agreements listed in
            Exhibits 99.3 and 99.4
     99.6   Employment agreement between the Registrant and Stanley Youtt
     99.7   Management agreement dated February 24, 2006, between Ranor and
            Techprecision LLC
     99.8   Lease, dated February 24, 2006 between WM Realty Management, LLC and
            Ranor
     99.9   2006 Long-term incentive plan
    99.10   Pro forma financial information*

*     To be filed by amendment.


                                      -34-
<PAGE>

                                   SIGNATURES

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


                                        LOUNBERRY HOLDINGS II, INC.
                                                (Registrant)

Date: March 2, 2006                     /s/ James G. Reindl
                                        ----------------------------------------
                                        James G. Reindl, Chairman






<PAGE>




                                   RANOR, INC.

                             MARCH 31, 2005 AND 2004
                                    (AUDITED)
                                       AND
                            FOR THE NINE MONTHS ENDED
                           DECEMBER 31, 2005 AND 2004
                                   (UNAUDITED)

                          INDEX TO FINANCIAL STATEMENTS

                                                                          PAGES

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                         F-2

FINANCIAL STATEMENTS

     BALANCE SHEETS                                                        F-3

     STATEMENTS OF OPERATIONS                                              F-4

     STATEMENTS OF STOCKHOLDERS' DEFICIT                                   F-5

     STATEMENTS OF CASH FLOWS                                              F-6

NOTES TO FINANCIAL STATEMENTS                                       F-7 - F-15









                                      F-1
<PAGE>



             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
and Stockholders of
Ranor, Inc.

We have audited the accompanying balance sheets of Ranor, Inc. as of March 31,
2005 and 2004, and the related statements of operations, stockholders' equity,
and cash flows for the years then ended. 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 standards of the Public Company
Accounting Oversight Board (United States). These standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining on a
test basis evidence supporting the amounts and disclosures in the financial
statements. We conducted our audit 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
has determined that it 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 also includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion. 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 Ranor, Inc. as of March 31,
2005 and 2004, and the results of its operations and its cash flows for the
years then ended in conformity with accounting principles generally accepted in
the United States of America.


Bloom & Co., LLP
Hempstead, NY
February 14, 2006









                                      F-2
<PAGE>

                                   RANOR, INC.
                                 BALANCE SHEETS

<TABLE>
<CAPTION>

                                     ASSETS

                                                                         DECEMBER 31,             MARCH 31,
                                                                             2005           2005              2004
                                                                             ----           ----              ----
                                                                         (UNAUDITED)      (AUDITED)         (AUDITED)
<S>                                                                       <C>            <C>              <C>
CURRENT ASSETS
       Cash and cash equivalents                                          $  777,950     $ 1,226,030      $ 2,198,205
       Accounts receivable, less allowance for doubtful
          accounts of $25,000 on December 31,  2005
          and March 31, 2005 and 2004                                      3,216,172       1,810,664        2,044,367
       Other receivables                                                      23,903          29,561           51,847
       Costs incurred on uncompleted contracts,
          net of progress billings                                         2,192,434       1,991,643        1,110,666
       Inventories- raw materials                                            121,694          86,703           66,657
       Prepaid expenses                                                      142,449         116,910          106,067
                                                                           ---------       ---------        ---------

                          Total current assets                             6,474,602       5,261,511        5,577,809
                                                                           ---------       ---------        ---------


Property, Plant And Equipment, net                                         2,639,979       2,870,347        3,212,165
                                                                           ---------       ---------        ---------

Total Assets                                                            $  9,114,581    $  8,131,858     $  8,789,974
                                                                          ==========      ==========       ==========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
      Accounts payable                                                   $ 1,675,575      $  928,170       $  756,657
      Accrued expenses                                                     1,477,471         890,163          570,300
      Current maturity of long-term debt                                       5,506           5,506            5,243
                                                                           ---------        --------        ---------

                    Total current liabilities                              3,158,552       1,823,839        1,332,200
                                                                           ---------       ---------        ---------

LONG-TERM DEBT, LESS CURRENT MATURITY                                     10,015,302      10,019,422       10,025,377
                                                                          ----------      ----------       ----------

STOCKHOLDERS' DEFICIT
      Common stock - authorized 1,998,000 shares of
          $0.001 par value;  350,000 shares issued and outstanding               350             350              350
       Accumulated deficit                                             (  4,059,623)   (  3,711,753)    (  2,567,953)
                                                                       -------------   -------------    -------------

       Total Stockholders' Deficit                                     (  4,059,273)   (  3,711,403)    (  2,567,603)
                                                                       -------------   -------------    -------------

                                                                      $    9,114,581  $    8,131,858    $   8,789,974
                                                                       =============   =============     ============
</TABLE>


    The accompanying notes are an integral part of the financial statements.


                                      F-3
<PAGE>

                                   RANOR, INC.
                            STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>

                                                           NINE MONTHS ENDED                       YEARS ENDED
                                                              DECEMBER 31,                           MARCH 31,

                                                            2005             2004               2005            2004
                                                            ----             ----               ----            ----
                                                        (UNAUDITED)       (UNAUDITED)         (AUDITED)       (AUDITED)

<S>                                                      <C>              <C>                <C>            <C>
Net Sales                                               $ 13,713,739      $ 10,538,268       $ 14,269,982   $ 10,932,917

Cost Of Sales                                             11,494,666         9,642,262         12,631,640     10,148,270
                                                         -----------       -----------        -----------    -----------

Gross Profit                                               2,219,074           896,006          1,638,342        784,647

Operating Expenses                                         1,731,702         1,220,311          1,664,848      1,691,748
                                                         -----------       -----------        -----------    -----------

Income/(loss) From Operations                                487,372       (  324,305)        (   26,506)    (  907,101)
                                                         -----------       -----------        -----------    -----------

Other (Income) Expenses
      Interest expense                                       840,849           841,065          1,121,487      1,121,203
      Other income                                       (    8,707)       (    5,375)        (    8,285)    (   37,198)
                                                         -----------       -----------        -----------    -----------
                                                             832,142       (  835,691)          1,113,202      1,084,005
                                                         -----------       -----------        -----------    -----------

Income/(loss) Before Income Taxes And                    (  344,770)       (1,159,996)        (1,139,708)    (1,991,106)
                                                         -----------       -----------        -----------    -----------
Cumulative Effect    of a change in
accounting principle

Provision For Income Taxes                                     3,100             3,682              4,092          8,056
                                                         -----------       -----------        -----------    -----------

Income/(loss) Before Cumulative Effect Of
Change In
   Accounting Principle                                  (  347,870)       (1,163,678)        (1,143,800)    (1,999,162)
                                                         -----------       -----------        -----------    -----------

Cumulative Effect Of Change In Accounting
  Principle, Net Of Income Taxes Of $0                            --                --                 --    (   56,142)
                                                         -----------       -----------        -----------    -----------

Net Income/(loss)                                      $(   347,870)      $(1,163,678)       $(1,143,800)   $(2,055,304)
                                                        ============       ===========        ===========    ===========

Number of shares outstanding                               1,998,000         1,998,000          1,998,000      1,998,000
                                                         -----------       -----------        -----------    -----------

Net loss per share before cumulative effect                    $ .17             $ .58              $ .57          $1.00
                                                         -----------       -----------        -----------    -----------
of change in accounting principle

Net loss per share after cumulative effect                       N/A               N/A                N/A          $1.03
                                                         -----------       -----------        -----------    -----------
of change in accounting principle

</TABLE>


    The accompanying notes are an integral part of the financial statements.


                                      F-4
<PAGE>

                                   RANOR, INC.
                       STATEMENTS OF STOCKHOLDERS' DEFICIT
                       YEARS ENDED MARCH 31, 2005 AND 2004
                 AND FOR THE NINE MONTHS ENDED DECEMBER 31, 2005

<TABLE>
<CAPTION>

                                                Preferred Stock (a)            Common Stock              Accumulated
                                Warrants        -------------------            ------------              -----------
                               Outstanding      Shares      Amount         Shares         Amount     Deficit         Total
                               -----------      ------      ------         ------         ------     -------         -----
AUDITED:
--------
<S>                              <C>             <C>      <C>              <C>              <C>      <C>           <C>
Balance, April 1, 2003           650,000         2,000    $2,000,000       350,000          $350     $(512,649)    $1,487,701

  Net loss for the year                             --            --            --            --    (2,055,304)    (2,055,304)
                                             ---------    ----------     ---------     ---------    -----------    -----------

Balance, March 31, 2004          650,000         2,000     2,000,000       350,000           350    (2,567,953)      (567,603)
                               ---------     ---------    ----------     ---------     ---------    -----------    -----------

   Net loss for the year                            --            --            --            --    (1,143,800)    (1,143,800)
                                             ---------    ----------     ---------     ---------    -----------    -----------

Balance, March 31, 2005          650,000         2,000    $2,000,000       350,000          $350   $(3,711,753)   $(1,711,403)
                               ---------     ---------    ----------     ---------     ---------    -----------    -----------

UNAUDITED:
   Net loss for the period                          --            --            --            --      (347,870)      (347,870)
                                             ---------    ----------     ---------     ---------    -----------    -----------

Balance, December 31, 2005       650,000         2,000    $2,000,000       350,000          $350   $(4,059,623)   $(2,059,273)
                               =========     =========    ==========     =========     =========    ===========    ===========
</TABLE>

(a) Due to the preferred stock agreement which has the features of a long term
liability, it is being shown as long term debt.

    The accompanying notes are an integral part of the financial statements.


                                      F-5
<PAGE>


                                   RANOR, INC.
                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                       NINE MONTHS ENDED                YEARS ENDED
                                                                         DECEMBER 31,                    MARCH 31,

                                                                      2005           2004           2005            2004
                                                                   (UNAUDITED)    (UNAUDITED)     (AUDITED)      (AUDITED)
                                                                   -----------    -----------     ---------      ---------

DECREASE IN CASH AND CASH EQUIVALENTS
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                               <C>             <C>            <C>            <C>
     Net loss for the period                                      $  (  347,870)  $(1,163,678)   $ (1,143,800)  $ (2,055,304)
                                                                    ------------ -------------    ------------   ------------
     Noncash items included in net loss:
          Depreciation and amortization                                  310,097       306,927         407,706        393,524
          Provision for bad debts                                             --            --              --         25,000
     Changes in assets and liabilities:
          Accounts receivable                                       ( 1,399,850)  ( 1,087,466)         255,989    (  536,329)
          Inventory                                                 (   609,610)  (   846,128)    (    20,046)    (   24,945)
          Costs and estimated earnings in excess of billings on
               Uncompleted contracts                                     373,828     1,059,088    (   880,977)        199,878
          Costs on uncompleted contracts, net of contract
          billings                                                            --            --              --    (  357,122)
          Prepaid expenses                                          (    25,539)      (18,205)    (    10,843)            659
          Accounts payable and accrued expenses                        1,334,979       344,299         491,376        505,722
                                                                    ------------ -------------    ------------   ------------
                                                                    (    16,095)  (   241,485)         243,205        206,387
                                                                    ------------ -------------    ------------   ------------
                 Net cash used in operating activities              (   363,965)  ( 1,405,163)    (   900,595)    (1,848,917)
                                                                    ------------ -------------    ------------   ------------

CASH FLOWS FROM INVESTING ACTIVITIES
     Purchases of property, plant and equipment                     (    79,731) (     65,888)    (    65,888)   (   143,338)
                                                                    ------------ -------------    ------------   ------------
                 Net cash used in investing activities              (    79,731) (     65,888)    (    65,888)   (   143,338)
                                                                    ------------ -------------    ------------   ------------

CASH FLOWS FROM FINANCING ACTIVITIES
     Proceeds from long-term borrowings                                       --            --              --         30,620
     Principal payments on long-term borrowings                     (     4,384) (      3,904)    (     5,692)             --
                                                                    ------------ -------------    ------------   ------------
                 Net cash provided by (used in) financing
                 activities                                         (     4,384) (      3,904)    (     5,692)         30,620
                                                                    ------------ -------------    ------------   ------------


                 Net decrease in cash and cash equivalents        $ (   448,080)  $(1,474,955)   $(   972,175)   $(1,961,635)
                                                                    ------------ -------------    ------------   ------------

CASH AND CASH EQUIVALENTS, beginning of period                         1,226,030     2,198,206       2,198,205      4,159,840
                                                                    ------------ -------------    ------------   ------------

CASH AND CASH EQUIVALENTS, end of period                            $    777,950  $    723,251    $  1,226,030    $ 2,198,205
                                                                    ============ =============    ============   ============



Supplemental Disclosures of Cash Flows Information
--------------------------------------------------
           Cash paid during the year for:
                  Interest expense                                  $         --   $   841,065     $   934,821    $ 1,121,203
                                                                    ============ =============    ============   ============
                  Income taxes                                      $      3,100   $      ,100     $     1,181    $     8,056
                                                                    ============ =============    ============   ============
</TABLE>


    The accompanying notes are an integral part of the financial statements.


                                      F-6
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES

USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

In preparing financial statements in conformity with generally accepted
accounting principles, management is required to make estimates and assumptions
that affect the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
revenues and expenses during the reported period. Actual results could differ
from those estimates.

FAIR VALUES OF FINANCIAL INSTRUMENTS

Cash and cash equivalents. Holdings of highly liquid investments with maturities
of three months or less, when purchased, are considered to be cash equivalents.
The carrying amount reported in the balance sheet for cash and cash equivalents
approximates its fair values. The amount of federally insured cash deposits was
$100,000 as of March 31, 2005 and March 31, 2004.

Since the redeemable preferred stock does not pay any dividends and the
redemption value is due in 2012, the discounted fair value of the redeemable
preferred stock, at company's cost of capital, is less than the face amount of
$2,000,000.

The carrying amount of trade accounts receivable, accounts payable, prepaid and
accrued expenses, and notes payable, as presented in the balance sheet,
approximates fair value.

ACCOUNTS RECEIVABLE

Trade accounts receivable are stated at the amount Ranor expects to collect.
Ranor maintains allowances for doubtful accounts for estimated losses resulting
from the inability of its customers to make required payments. Management
considers the following factors when determining the collectability of specific
customer accounts: customer credit-worthiness, past transaction history with the
customer, current economic industry trends, and changes in customer payment
terms. If the financial condition of Ranor's customers were to deteriorate,
adversely affecting their ability to make payments, additional allowances would
be required. Based on management's assessment, Ranor provides for estimated
uncollectible amounts through a charge to earnings and a credit to a valuation
allowance. Balances that remain outstanding after Ranor has used reasonable
collection efforts are written off through a charge to the valuation allowance
and a credit to accounts receivable. Current earnings are also charged with an
allowance for sales returns based on historical experience.

INVENTORIES

Inventories consist of raw materials and are stated at the lower of cost or
market. Cost is determined principally by the first-in, first-out method.

NOTES PAYABLE

We account for all note liabilities that are due and payable in one year as
short-term notes.


                                      F-7
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

LONG-LIVED ASSETS

Property, plant and equipment- these assets are recorded at cost less
depreciation and amortization. Depreciation and amortization are accounted for
on the straight-line method based on estimated useful lives. The amortization of
leasehold improvements is based on the shorter of the lease term or the life of
the improvement. Betterments and large renewals, which extend the life of the
asset, are capitalized whereas maintenance and repairs and small renewals are
expenses, as incurred. The estimated useful lives are: machinery and equipment,
7-15 years; buildings, 30 years; and leasehold improvements, 10-20 years.

REVENUE RECOGNITION

Revenues from contracts were recorded on the percentage-of-completion method.
Effective April 1, 2003, Ranor adopted the units-of-delivery method under the
percentage-of-completion method of revenue recognition. Accordingly, income is
recognized at the time at which a unit under contract is completed and delivered
to the customer. The costs related to the unit are recorded as costs of goods
sold in an amount that approximates a proportionate amount for each unit of the
total expected costs in completing the entire contract. As described in Note 3,
prior to 2004, Ranor followed the labor-to-labor method under the
percentage-of-completion method of accounting for such contracts.

Adjustments to cost estimates are made periodically, and losses expected to be
incurred on contracts in progress are charged to operations in the period such
losses are determined and are reflected as reductions of the carrying value of
the costs incurred on uncompleted contracts.


COSTS INCURRED ON UNCOMPLETED CONTRACTS

Costs incurred on uncompleted contracts consist of labor, overhead, and
materials costs incurred on uncompleted contracts. Costs are stated at the lower
of cost or market and reflect accrued losses, if required, on uncompleted
contracts.

ADVERTISING EXPENSES

Advertising costs are charged to operations when incurred. Advertising expenses
were $14,060 in 2005 and $30,686 in 2004.

INCOME TAXES

Temporary differences giving rise to deferred income taxes consist primarily of
the reporting of contract revenues and expenses and losses on uncompleted
contracts, the excess of depreciation for tax purposes over the amount for
financial reporting purposes, inventory valuation, accrued expenses accounted
for differently for financial reporting and tax purposes, and net operating loss
carryforwards.


                                      F-8
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

NEW ACCOUNTING PRONOUNCEMENTS

In December 2004, the FASB issued SFAS No.123 (revised 2004), "Share-Based
Payment" ("SFAS 123R"), which replaces SFAS No. 123, "Accounting for Stock-Based
Compensation" ("SFAS 123") and supercedes APB Opinion No. 25, "Accounting for
Stock Issued to Employees. "SFAS 123R requires that all share-based payments to
employees, including grants of employee stock options, be recognized in the
financial statements based on their fair values, beginning with the first
interim or annual period after June 15, 2005, with early adoption encouraged.
The pro forma disclosures previously permitted under SFAS 123, no longer will be
an alternative to financial statement recognition. We are required to adopt SFAS
123R in the third quarter of 2005. Under SFAS 123R, we must determine the
appropriate fair value model to be used in valuing share-based payments, the
amortization method for compensation cost and the transition method to be used
at the date of adoption. Upon adoption, we may choose from two transition
methods: the modified-prospective transition approach or the
modified-retroactive transition approach. Under the modified-prospective
transition approach we would be required to recognize compensation cost for
awards that were granted prior to, but not vested as of the date of adoption.
Prior periods remain unchanged and pro forma disclosures previously required by
SFAS No. 123 continue to be required. Under the modified-retrospective
transition method, we would be required to restate prior periods by recognizing
compensation cost in the amounts previously reported in the pro forma disclosure
under SFAS No. 123. Under this method, we would be permitted to apply this
presentation to all periods presented or to the start of the fiscal year in
which SFAS No. 123R is adopted. We would also be required to follow the same
guidelines as in the modified-prospective transition method for awards granted
subsequent to adoption and those that were granted and not yet vested.

NEW ACCOUNTING PRONOUNCEMENTS

We are currently evaluating the requirements of SFAS 123R and its impact on our
consolidated results of operations and earnings per share. We have not yet
determined the method of adoption or the effect of adopting SFAS 123R, and it
has not been determined whether the adoption will result in amounts similar to
the current pro forma disclosures under SFAS 123.

In December 2004, the FASB issued Staff Position ("FSP") No.109-2, "Accounting
and Disclosure Guidance for the Foreign Earnings Repatriation Provision within
the American Jobs Creation Act of 2004" ("FSP 109-2"). This position provides
guidance under FASB Statement No.109 ("SFAS 109"), "Accounting for Income
Taxes", with respect to recording the potential impact of the repatriation
provisions of the American Jobs Creation Act of 2004 (the "Jobs Act") on
enterprises' income tax expense and deferred tax liability. The Jobs Act was
enacted on October 22, 2004. FSP 109-2 states that an enterprise is allowed time
beyond the financial reporting period of enactment to evaluate the effect of the
Jobs Act on its plan for reinvestment or repatriation of foreign earnings for
purposes of applying SFAS 109.

In December 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary Assets
- An Amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions"
("SFAS 153"). SFAS 153 eliminates the exception from fair value measurement for
nonmonetary exchanges of similar productive assets in paragraph 21(b) of APB
Opinion No. 29, "Accounting for Nonmonetary Transactions," and replaces it with
an exception for exchanges that do not have commercial substance. SFAS 153
specifies that a nonmonetary exchange has commercial substance if the future
cash flows of the entity are expected to change significantly as a result of the
exchange. SFAS 153 is effective for fiscal periods beginning after June 15,
2005. We have considered SFAS 153 and have determined that this pronouncement is
not applicable to our current operations.


                                      F-9
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

NEW ACCOUNTING PRONOUNCEMENTS, CONTINUED

In November 2004, the FASB issued SFAS No. 151, "Inventory Costs - An Amendment
of ARB Opinion No. 43, Chapter 4" ("SFAS 151"). SFAS 151 amends the guidance in
ARB No. 43, Chapter 4, "Inventory Pricing," to clarify the accounting for
abnormal amounts of idle facility expense, freight, handling costs, and wasted
material (spoilage). Among other provisions, the new rule requires that items
such as idle facility expense, excessive spoilage, double freight, and
rehandling costs be recognized as current period charges regardless of whether
they meet the criterion of "so abnormal" as stated in ARB No. 43. Additionally,
SFAS 151 requires that the allocation of fixed production overheads to the costs
of conversion be based on the normal capacity of the production facilities. SFAS
151 is effective for fiscal years beginning after June 15, 2005. We have
considered SFAS 151 and have determined that this pronouncement will not
materially impact our consolidated results of operations.

In November 2004, the FASB issued SFAS No. 152, "Accounting for Real Estate
Time-Sharing Transactions - An amendment of SFAS No. 66 and 67". This statement
amends SFAS No. 66, "Accounting for Sales of Real Estate, to reference the
financial accounting and reporting guidance for real estate time-sharing
transactions which is provided in AICPA Statement of Position ("SOP") 04-2,
"Accounting for Real Estate Time-Sharing Transactions." This statement also
amends SFAS No. 67, "Accounting for Costs and Initial Rental Operations of Real
Estate Projects," to state the guidance for (a) incidental costs and (b) costs
incurred to sell real estate projects does not apply to real estate time-sharing
transactions. The accounting for those costs is subject to guidance in SOP 04-2.
SFAS 152 is effective for fiscal years beginning after June 15, 2005. We have
considered SFAS 152 and have determined that this pronouncement is not
applicable to our current operations.

In December 2003, the FASB issued a revision to Statement No. 132, Employers'
Disclosures about Pensions and Other Postretirement Benefits. This revision
requires additional disclosures by Ranor regarding its plan assets, investment
strategies, plan obligations and cash flows. We have considered revised
statement 132 and have determined that at this time this pronouncement is not
applicable to our current operations.

NOTE 2. DESCRIPTION OF BUSINESS

Ranor, Inc., ("Ranor") is a leading provider of high precision metal fabrication
and machining services for large metal components weighing up to 100 tons. Ranor
fabricates nuclear grade steel casks, canisters and housings for the
transportation and storage of radioactive materials; produces large fabrications
for Navy aircraft carriers, submarines and commercial vessels; and manufactures
pulp and paper machinery, gas turbine power generation equipment, oil refinery
and utilities equipment. Ranor is one of two companies currently capable of
machining one-piece aluminum domes for Boeing's Delta III and Delta IV rocket
programs.


                                      F-10
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 3. PROPERTY, PLANT AND EQUIPMENT

As of March 31, 2005 and 2004 property, plant and equipment consisted of the
following:

                                                      2005               2004
                                                      ----               ----
       Land                                         $ 110,113          $ 110,113
       Building and improvements                    1,223,054          1,223,054
       Furniture and fixtures                          43,737             38,471
       Machinery and equipment                      2,549,045          2,488,422
                                                  -----------         ----------
                                                    3,925,949          3,860,060
                                                  -----------         ----------

       Less: accumulated depreciation               1,055,602            647,895
                                                  -----------         ----------
                                                  $ 2,870,347         $3,212,165
                                                  -----------         ----------

Depreciation expense for the years ended March 31, 2005 and 2004 were $407,707
and $393,524, respectively.

NOTE 4. CHANGE IN ACCOUNTING PRINCIPLE/CONTRACTS IN PROCESS

During 2004, Ranor changed its method of recognizing revenues for contracts that
have an estimated contract value of $500,000 and contract life of at least nine
months. Whereas prior to 2004, Ranor followed the labor-to-labor method for
determining the percentage-of-completion method of accounting for such contracts
in which income is recognized in the ratio that labor costs incurred bears to
estimated total labor costs, it is now recognizing the percentage-of-completion
based upon the units-of-delivery method (see Note 1). The cumulative effect of
the change of $56,142 is shown as a one-time charge to operations in the 2004
statement of operations.

  Contracts in process consisted of the following at March 31:

                                                       2005             2004
                                                  ------------     -------------
    Costs incurred on uncompleted contracts        $5,561,541      $   5,610,949
    Estimated losses accrued to date                 (892,376)       (1,064,104)
                                                  ------------     -------------
                                                    4,669,165         4,546,845
    Less: billings to date                          2,677,522         3,436,179
                                                  ------------     -------------

                                                   $1,991,643      $  1,110,666
                                                  ============     =============


These amounts are included in the accompanying balance sheets under the caption
"Costs and estimated earnings in excess of billings on uncompleted contracts" at
March 31, 2005 and 2004.


                                      F-11
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>

NOTE 5. LONG-TERM DEBT

     Long-term debt consists of the following at March 31:
                                                                                            2005              2004
                                                                                        -----------       -----------
<S>                                                                                      <C>               <C>
        Preferred Stock - authorized 2,000 shares of $.001 par value:
           2,000 shares issued and outstanding and redeemable on August 7,
           2012.
        (See Note 10)                                                                     $2,000,000       $2,000,000

        Green Mountain Partners III, L.P. -
          Unsecured note payable in semi-annual interest installments at
          14.0%, due in February and August. Principal payments of
          $800,000 due annually commencing on August 7, 2006 through
          August 2011, and $1,600,000 on August 7, 2012. Prepayments of
          principal are allowable or required under certain conditions, as
          defined. The note is subject to covenants, which provide, among
          other things, restrictions on the incurrence of additional debt
          or commitments.                                                                  6,400,000        6,400,000

        Phoenix Life Insurance Company -
          Unsecured note payable in semi-annual interest installments at
          14.0%, due in February and August. Principal payments of
          $200,000 due annually commencing on August 7, 2006 through
          August 2011, and $400,000 on August 7, 2012. Prepayments of
          principal are allowable or required under certain conditions, as
          defined. The note is subject to covenants, which provide, among
          other things, restrictions on the incurrence of additional debt
          or commitments.                                                                  1,600,000        1,600,000

        Ford Motor Credit Company-
          Payable in monthly installments of $552 including interest of
          4.90% commencing July 20, 2003 through June 20, 2009.
          Secured by a vehicle.                                                               24,928           30,620
                                                                                      --------------   --------------
                                                                                          10,024,928       10,030,620
        Principal payments due within one year                                                 5,506            5,243
                                                                                     ---------------  ---------------

                                                                                         $10,019,422      $10,025,377
                                                                                     ===============  ===============
</TABLE>


     As of March 31, 2005, long-term debt matures as follows:

              Years ending
                March 31,                                      Amount
                ---------                                    ---------
                  2006                                     $       5,506
                  2007                                         1,005,782
                  2008                                         1,006,071
                  2009                                         1,006,375
                  2010                                         1,001,194
               Thereafter                                      6,000,000
                                                               ---------
                                                             $10,024,928
                                                             ===========

                                      F-12
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 6. INCOME TAXES

<TABLE>
<CAPTION>

The provision for income taxes consists of the following at March 31:                 2005           2004
                                                                                      ----           ----
<S>                                                                                     <C>           <C>
Current                                                                                 $ 4,092       $ 8,056
Deferred                                                                                     --            --
                                                                                    -----------    ----------
                                                                                      $   4,092      $  8,056
                                                                                    ===========    ==========

Deferred tax assets and liabilities consist of the following at March 31:
    Deferred tax asset:
        Allowance for doubtful accounts                                                $  9,800       $ 9,800
        Inventory valuation                                                              26,900        10,700
        Revenue recognition on uncompleted contracts                                    113,900       457,800
        Net operating loss carryforward                                               1,353,200       564,700
        Accrued expenses                                                                127,600       106,000
                                                                                    -----------    ----------
                                                                                      1,631,400     1,149,000
        Less: Valuation Allowance                                                   (1,440,000)   (  995,700)
                                                                                    ===========    ==========
                                                                                   $    191,400   $   153,300
                                                                                    ===========    ==========

     Deferred tax liabilities:
          Depreciation of property and equipment                                   $    191,400   $   153,300
                                                                                    ===========    ==========
</TABLE>


The valuation allowance increased by $444,300 in 2005 and $798,100 in 2004.

At March 31, 2005, Ranor has approximately $3,470,000 of net operating losses
available to reduce future taxable income through 2025 for federal purposes and
2010 for state purposes. Under Internal Revenue Code Section 382, whenever a
stock ownership change of more than 50% occurs, within generally a three-year
period (testing period), the corporation's ability to use pre-change loss carry
forward is substantially limited.

Ranor's effective income tax rate is 39%, which is higher than what would be
expected if the federal statutory rate was applied to losses primarily because
of the valuation allowance applied to the net operating loss carryforward.


NOTE 7. RELATED PARTY TRANSACTIONS

Ranor has agreements to pay management fees totaling $200,000 per year to four
stockholders under agreements that expire August 2005 and are renewable annually
thereafter. Effective June 2003, two of these stockholders have accepted a
salary from Ranor in lieu of the management fee, but have retained their rights
under their agreements. Total management fees charged to operations under this
agreement were $49,000 in 2005 and $75,000 in 2004. As of March 31, 2005 and
2004, Ranor has included in accounts payable unpaid management fees of $132,291
and $83,333, respectively. The total future commitments under these agreements
were $8,333 as of March 31, 2005.

Ranor has long-term debt payable to Green Mountain Partners III, L.P. and
Phoenix Life Insurance Company (see Note 4), which holds the outstanding
preferred stock and common stock warrants (see Note 9). Interest expense charged
to operations under the related party debt was $1,120,000 in 2005 and 2004.


                                      F-13
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 8. OPERATING LEASE

Ranor leases office equipment under operating lease agreements expiring through
November 2008. Total rent expense charged to operations approximated $16,700 in
2005 and $19,900 in 2004.

Future minimum lease payments under noncancellable portions of the leases as of
March 31, 2005, are as follows:

              Years ending
               March 31,                                        Amount
               ---------                                        ------
                 2006                                          $  16,678
                 2007                                             16,678
                 2008                                             15,288
                                                               ---------
         Total minimum lease payments                          $  48,644
                                                               =========


NOTE 9. PROFIT SHARING PLAN

Ranor has a 401(k) profit sharing plan that covers substantially all employees
who have completed 90 days of service. Ranor retains the option to match
employee contributions. There were no employer-matched contributions charged to
operations in 2005 and 2004.

NOTE 10. CAPITAL STOCK

PREFERRED STOCK

The 2,000 shares of preferred stock outstanding are classified as Series A and
carry a mandatory redemption provision under which Ranor is required to redeem
all the outstanding shares on August 7, 2012 at $1,000 per share. Ranor has the
option to redeem any or all the shares prior to that date. The preferred stock
carries no voting or dividend rights. The preferred stock carries a preference
of $1,000 per share in the event of liquidation.

The stockholder agreements contain a provision whereby, effective August 2009,
any preferred stockholder can, upon written notice, require Ranor to repurchase
their shares at a price as defined in the agreement.


STOCK WARRANTS

At March 31, 2005 and 2004, the preferred stockholders and debt holders (see
Note 6) had warrants to acquire 650,000 shares of common stock at a price of
$.001 per share. The warrants are immediately exercisable and expire on August
7, 2012. The warrants carry repurchase provisions as defined. Six hundred fifty
thousand shares of common stock have been reserved for the issuance of these
warrants.


The stockholder agreements contain a provision whereby, effective August 2009,
any holders of stock warrants can, upon written notice, require Ranor to
repurchase the warrants or any shares issued under the warrant agreement at a
price as defined in the agreement. At March 31, 2005 and 2004, the warrants had
no determinable value.

COMMON STOCK

The sale or transfer of the common stock of Ranor is subject to the terms of the
stockholder agreement among Ranor and its stockholders and warrant holders.


                                      F-14
<PAGE>

                                   RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 11. CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS

Ranor maintains bank account balances, which, at times, may exceed insured
limits. Ranor has not experienced any losses with these accounts. Management
believes Ranor is not exposed to any significant credit risk on cash.

In 2005, Ranor sold a substantial portion of its products to two customers.
Sales for the period ended March 31, 2005, to these customers were approximately
$2,680,000 (19%), and $1,572,000 (11%). At March 31, 2005, amounts due from
these customers, included in trade accounts receivable, were $519,667 and
$38,777, respectively.

In 2004, Ranor sold a substantial portion of its products to two customers.
Sales for the period ended March 31, 2004 to these customers were approximately
$2,311,000 (19%), and $1,818,000 (15%). At March 31, 2004, amounts due from
these customers, included in trade accounts receivable, were $286,696 and
$248,604, respectively.

NOTE 12. ADOPTION OF ACCOUNTING PRINCIPLE

The FASB has issued Statement No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity. Statement No.
150 requires that certain freestanding financial instruments be reported as
liabilities in the balance sheet. Depending on the type of financial instrument,
it will be accounted for at either fair value or the present value of future
cash flows determined at each balance sheet date with the change in that value
reported as interest expense in the income statement. Prior to the application
of Statement No. 150, either those financial instruments were not required to be
recognized, or if recognized were reported in the balance sheet as equity and
changes in the value of those instruments were normally not recognized in net
earnings.

As explained in Note 9, Ranor has mandatory redeemable preferred stock that is
reported as a liability under Statement No. 150. The carrying value of that
stock was transferred from stockholders' deficiency to liabilities, which had
the effect of increasing stockholders' deficiency and increasing liabilities.

NOTE 13. SUBSEQUENT EVENT

On August 17, 2005 an agreement was signed whereby the present shareholders,
note holders and preferred stock holders agreed to sell their shares, redeem
their notes and retire their preferred stock. The purchaser of these shares is
Ranor Acquisition LLC, a Delaware Limited Liability Company. The purchase price
of the Common Securities is $9,250,000 minus the aggregate amount of the Company
Debt outstanding on the closing date, minus: (1) the adjusted redemption value
of the preferred shares; (2) the sellers' expenses; (3) the net cash amount on
the closing date as determined in accordance with the agreement (or plus, if the
net cash amount is a negative number); (4) and any accounts payable adjustment
amount (such aggregate value being referred to herein as the "closing date
purchase price"). The closing date purchase price shall be subject to further
adjustment after the closing pursuant to a review by the sellers' accountants.

The incoming shareholders will pay off the $8 million notes payable, redeem the
$2 million preferred stock, pay the outstanding balance of the accounts payable,
and recompense the purchase price of common shares of Ranor from the following
funds:

1. Sale-leaseback of Ranor's land and building for $3 million.
2. Bank term Loan of $4 million and $1 million bank line of credit.
3. Capital contribution of $2.5 million.
4. Ranor's cash account.





                                      F-15
{"company-data": {"conformed-name": "LOUNSBERRY HOLDINGS II INC", "cik": "0001328792", "assigned-sic": "6770", "irs-number": "000000000", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-51378", "film-number": "06663481"}, "business-address": {"street1": "90 GROVE STREET", "street2": "SUITE 204", "city": "RIDGEFIELD", "state": "CT", "zip": "06877", "phone": "203-431-8300"}, "mail-address": {"street1": "90 GROVE STREET", "street2": "SUITE 204", "city": "RIDGEFIELD", "state": "CT", "zip": "06877"}}
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 8-K

                                 CURRENT REPORT
     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

       Date of Report (Date of earliest event reported): February 24, 2006

                          Lounsberry Holdings II, Inc.
             (Exact name of registrant as specified in its charter)
Delaware                              0-51378                                51-0539828
-----------------------------------------------------------------------------------------------------------------------
   (State or other jurisdiction of           (Commission File Number)       (I.R.S. Employer Identification No.)
            incorporation)
One Bella Drive, Westminster, Massachusetts                 01473
--------------------------------------------------------------------------------
   (Address of principal executive offices)                (Zip Code)

                90 Grove Street, Suite 204, Ridgefield, CT 06877
--------------------------------------------------------------------------------
                 (Former address of principal executive offices)

Registrant's telephone number, including area code: (978) 874-0591

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):

|_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)

|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)

|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))

|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement.

      On February 24, 2006, Lounsberry Holdings II, Inc. (the "Company")
acquired the stock of Ranor, Inc., a Delaware corporation ("Ranor"), pursuant to
a stock purchase agreement dated as of August 17, 2005, by and among Ranor
Acquisition LLC, a Delaware limited liability company ("Ranor Acquisition"), the
former stockholders of Ranor, and Ranor, which agreement, as amended, is
referred to as the "Ranor Agreement." In connection with the acquisition of
Ranor pursuant to the Ranor Agreement:

      (a) The Company entered into a preferred stock purchase agreement (the
"Preferred Stock Agreement") with Barron Partners LP, pursuant to which Barron
Partners invested $2,200,000 for which the Company issued 7,719,250 shares of a
newly-created series of preferred stock, designated as the series A preferred
stock, and warrants (the "Warrants") to purchase an aggregate of 11,220,000
shares of common stock. The series A preferred stock is convertible into
7,719,250 shares of common stock, subject to adjustment.

      (b) The Company entered into a registration rights agreement (the "Barron
Registration Rights Agreement") pursuant to which the Company agreed to register
the shares of common stock issuable upon conversion of the Series A Preferred
Stock and the Warrants pursuant to the Securities Act of 1933, as amended (the
"Securities Act").

      (c) The Company entered into a stock redemption agreement with Capital
Markets Advisory Group, LLC ("Capital Markets"), which was then the Company's
principal stockholder, pursuant to which the Company purchased 928,000 shares of
common stock from Capital Markets for $200,000, using the proceeds from the
Preferred Stock Agreement.

      (d) The Company entered into an agreement (the "Acquisition Company
Agreement") with Ranor Acquisition, the members of Ranor Acquisition, pursuant
to which Ranor Acquisition assigned its obligations under the Ranor Agreement,
the Company assumed the obligations of Ranor Acquisition under the Ranor
Agreement and the Company issued 7,697,000 shares of common stock.

      (e) The Company entered into a stock subscription agreement pursuant to
which the Company issued 1,700,000 shares of common stock.

      (f) Ranor entered into a loan and security agreement with Sovereign Bank
pursuant to which the Company borrowed $4.0 million, for which the Company
issued its term note, and Sovereign provided the Company with a $1.0 million
revolving credit arrangement.

      (g) Ranor sold its real estate to WM Realty Management, LLC ("WM") for
$3.0 million, and Ranor leased the real property on which its facilities are
located from WM pursuant to a triple net lease. WM is an affiliate of the
Company.

      (h) Ranor entered into a management agreement with Techprecision LLC,
pursuant to which Techprecision would provide management services to Ranor.

                                      -1-
The Ranor Agreement

      Pursuant to the Ranor Agreement, the Company acquired all of the
outstanding capital stock and warrants of Ranor for a total purchase price of
$9.25 million, less amounts paid to the holders of Ranor's outstanding debt. The
debt was held by the preferred stockholders, and substantially all of the
proceeds were applied to the payment of the debt. The Ranor agreement also
provides that the Ranor stockholders may withdraw Ranor's cash in excess of
$250,000 at the closing. The total amount paid pursuant to this provision was
$813,000. At the closing, the Company deposited $925,000 of the purchase price
into escrow as security for any damages which the Company may sustain as a
result of a breach of the representations and warranties under the Ranor
Agreement.

      The purchase price, including payment by Ranor of the notes, was paid from
the net proceeds of the $4.0 million term loan from Sovereign ($3,953,317.47),
the sale by Ranor of the real estate to WM ($3,000,000), the proceeds from the
sale of the series A preferred stock ($1,129,182.53) and $240,000 from the cash
remaining at Ranor after payment of the $813,000.

      Following the closing, the Company cancelled all of the outstanding
preferred stock and warrants and all but 1,000 shares of Ranor's common stock.

Preferred Stock Agreement

      Pursuant to the Preferred Stock Agreement:

      o     The Company sold to Barron Partners, for $2,200,000, (i) 7,719,250
            shares of series A preferred stock and Warrants to purchase
            5,610,000 shares of common stock at an exercise price of $.57 per
            share and 5,610,000 shares of common stock at an exercise price of
            $.855 per share. The terms of the series A preferred stock are set
            forth in "Item 5.03. Amendments to Articles of Incorporation or
            By-laws; Changes in Fiscal Year."

      o     The Company agreed that it will have appointed such number of
            independent directors that would result in a majority of its
            directors being independent directors, that the audit committee
            would be composed solely of independent directors and the
            compensation committee would have a majority of independent
            directors. Failure of the Company to meet these requirements would
            results in the imposition of liquidated damages which are payable in
            cash or additional shares of series A preferred stock. As of the
            date of this report, the Company has satisfied this requirement.

      o     The Company and Barron Partners entered into the Registration Rights
            Agreement.

      o     The Certificate of Designation and the Barron Warrants provide that
            the series A preferred stock cannot be converted and Barron Warrants
            cannot be exercised if such conversion or exercise would result in
            the holder and its affiliates of more than 4.9% of the then
            outstanding number of shares of common stock on such date.
            Beneficial ownership is determined in accordance with Section 13(d)
            of the Securities Exchange Act of 1934, as amended, and Regulation
            13d-3. This limitation may not be modified or waived.

      o     The Company's board of directors approved and agreed to submit to
            the Company's stockholders for their approval, an amendment to the
            Company's certificates of incorporation to provide that the terms
            and conditions of any rights, options and warrants approved by the
            board of directors may provide that any or all of such terms and
            conditions may be waived or amended only with the consent of the
            holders of a designated percentage of a designated class or classes
            of capital stock of the Company (or a designated group or groups of
            holders within such class or classes, including but not limited to
            disinterested holders), and the applicable terms and conditions of
            any such rights, options or warrants so conditioned may not be
            waived or amended absent such consent."

                                      -2-
o     The warrants issued to the investors have a term of five years. In
            the event our EBITDA per share of common stock, as defined, for the
            fiscal year ended March 31, 2006, is less than $.06591 per share,
            the Exercise Price shall be reduced proportionately by up to 15%.
            The exercise price will be reduced by 15% if EBITDA per share
            $.04613 per share or lower. In the event our EBITDA per share of
            common stock for the fiscal year ended March 31, 2007, is less than
            $.08568 per share, the Exercise Price shall be reduced
            proportionately by up to 15%. The exercise price will be reduced by
            15% if EBITDA per share $.05997 per share or lower.

      o     The warrants also provide that, with certain exceptions, if the
            Company issues common stock at a price, or warrants or other
            convertible securities with an exercise or conversion price which is
            less than the exercise price of the warrants, the exercise price of
            the warrants will be reduced in accordance with a formula based on
            the exercise price or conversion price, as the case may be, of such
            other securities.

      o     The Company reimbursed Barron Partners for its due diligence and
            other expenses in the amount of $50,000.

Barron Registration Rights Agreement

      Pursuant to the Barron Registration Rights Agreement, the Company agreed
to file, within 60 days after the closing (February 24, 2006), a registration
statement covering the common stock issuable upon conversion of the series A
preferred stock and exercise of the Warrants. The failure of the Company to meet
this schedule and other timetables provided in the registration rights agreement
would result in the imposition of liquidated damages, which are payable through
the issuance of additional shares of series A preferred stock. If we fail to
file a registration statement within 60 days of the closing or if the
registration statement is not declared effective by the SEC on the first to
occur of (i) 120 days following the date the registration statement is required
to be filed, (ii) ten days following the receipt of a "No Review" or similar
letter from the SEC or (iii) the third business day following the day the
Company receives notice from the SEC that the SEC has determined that the
Registration Statement eligible to be declared effective without further
comments by the SEC. The Company is required to pay liquidated damages in shares
of series A preferred stock, and not cash. The number of shares to be issued by
the Company as liquidated damages is 2,540 shares of series A preferred stock
for each day the Company has not complied with its registration requirements, up
to a maximum of 1.4 million shares of series A preferred stock. If, at the time
of a failure of the Company to maintain the effectiveness of the registration
statement, the holder shall own less than the number of shares of series A
preferred stock initially issued by the Company, the number of shares of series
A preferred stock issuable per day shall be reduced proportionately.

                                      -3-
Acquisition Company Agreement

      Pursuant to the Acquisition Company Agreement, Ranor Acquisition assigned
the Ranor Agreement to the Company, and the Company assumed the obligations of
Ranor Acquisition pursuant to the Ranor Agreement. In consideration for the
assignment and for expenses of $115,000 advanced by Ranor Acquisition on behalf
of the Company, the Company issued to the members of Ranor Acquisiton, an
aggregate of 7,697,000 shares of common stock.

      The Acquisition Company Agreement provides that the Acquisition Company
members, who received 7,697,000 shares of common stock may not sell these shares
for a period of twelve months following the closing. Thereafter, none of the
members shall sell more than 10% of his or her shares in the public market in
the twelve-month period following the expiration of the lock-up period of more
than an additional 10% of his shares during the following twelve-month period.
Commencing January 31, 2007, the holders have demand and piggyback registration
rights. The Company is not subject to any liquidated damages in the event that
Company fails to satisfy its obligations to register the shares.

Subscription Agreement

      Pursuant to the Subscription Agreement, the Company sold 1,700,000 shares
of common stock to an accredited investor for $500,000. Commencing January 31,
2007, the investor has demand and piggyback registration rights. The Company is
not subject to any liquidated damages in the event that Company fails to satisfy
its obligations to register the shares.

Stock Redemption Agreement

      Pursuant to an agreement dated February 24, 2006 between the Company and
Capital Markets, which was then the Company's principal stockholder, the Company
purchased 928,000, constituting 90.2% of the then outstanding shares of the
Company's common stock, from Capital Markets for $200,000. The purchase price
was paid from the proceeds of the sale of series A preferred stock to Barron
Partners. In connection with that agreement, the Company agreed to include all
of the then-outstanding shares of common stock in the first registration
statement that the Company files after the closing.

Loan and Security Agreement

      Pursuant to the loan and security agreement with Sovereign Bank, Ranor
borrowed $4.0 million on a term loan basis, for which it issued is its
promissory note due March 1, 2013. Ranor pays interest at 9% per annum until
February 28, 2011 and at prime plus 1 1/2% per annum thereafter. The note
provides for quarterly payments of $142,857.14. Ranor is also required to
utilize 50% of the excess its cash flow above the required 1.2 times the fixed
charge coverage ratio to be applied to payments due on the Term Loan in the
inverse order of maturity. Such amount shall be due on or before April 1, 2007
for the period ending March 31, 2007, and annually on July 1 of each year
thereafter.

      Ranor also issued its revolving promissory note in the principal amount of
$1.0 million. Ranor has the right to draw on this facility from time to time,
based on a borrowing base formula. The note bears interest at the rate of prime
plus 1 1/2%.

                                      -4-
Payment of the notes and Ranor's obligaitions under the loan agreement and
the notes is secured by a security interest in substantially all of Ranor's
assets, and is guaranteed by the Company. The Company's guaranty is secured by a
pledge of the Ranor stock.

Sale and Leaseback of Real Property

      Ranor sold its real property to WM, an affiliate of the Company, for a
purchase price of $3.0 million, and leased back from WM all of the property,
except for three parcels which could be used for residential lots, pursuant to a
triple net lease. The lease has a term of 15 years at an initial annual rental
of $438,000, subject to an annual cost of living adjustment. Ranor has two five
year options at a rental equal to the greater of the then current minimum annual
rental or the fair rental. Ranor has a purchase option at the appraised value,
but not less than the amount due to WM's lender, determined as provided in the
lease. WM has a $3.3 million mortgage on the premises which matures on August
24, 2006. If Ranor exercises its option, it purchases all of the property owned
by WM. In the event of a default by WM under its present mortgage, our monthly
rent will increase to $39,000.

Management Agreement

      Pursuant to the management agreement, Ranor engaged Techprecision LLC as
its manager. Techprecision is to provide the services of James G. Reindl as
chairman, Andrew A. Levy for marketing support and analysis of long-term
contracts and Martin M. Daube for marketing support. The management agreement
has a term expiring on March 31, 2009, and provided for annual compensation at
the rate of $200,000 per year. Neither Mr. Reindl, Mr. Levy nor Mr. Daube
receives any additional compensation from Ranor for the services performed
pursuant to the management agreement. In addition, if Ranor meets or exceeds
performance criteria set by the compensation committee (which is to be composed
of independent directors), Techprecision received a bonus equal to 2 1/2% of
earnings before interest, taxes, depreciation and amortization after giving
effect to the bonus.

Item 2.01. Completion of Acquisition or Disposition of Assets.

Information in response to this Item 2.01 is keyed to the Item numbers of Form
10SB.

                                     Part I

Item 1.  Description of Business

                                     SUMMARY

      On February 24, 2006, the Company acquired Ranor pursuant to the Ranor
Agreement, which is described under "Item 1.01. Entry into a Material Definitive
Agreement."

      References to "we," "us," "our" and similar words refer to the Company
and, where applicable, Ranor, which, as a result of the purchase of the Ranor
stock because the Company's wholly-owned subsidiary in a transaction accounted
for as a reverse acquisition. Prior to the effectiveness of the reverse
acquisition these terms refer to Ranor.

      We produce large metal fabrications and perform precision machining
operations for large military, commercial, nuclear, aerospace, shipbuilding and
industrial customers. Our principal services are large metal fabrications,
machining and engineering. Each of our contracts covers a specific product. We
do not mass-produce any products or distribute such products on the open market.
We render our services under "build to print" contracts with our contractors.
However, we also help our customers to analyze and develop their projects for
constructability by providing engineering and research and development services,
for which we bill our customers.

                                      -5-
We are one of a small number of large precision metal fabrication
companies located in the United States. However, only two others produce
products in all industry sectors that we service. In recent years, the capital
goods market experienced a slow down due to the industry over-build of product
in the late 1990's. Additional contributions to the industry slow-down resulted
from the events of September 11, 2001. However, based on recent project
inquiries, recent projects awarded and current customer demands for our
services, we believe the our market has rebounded.

      Although we provide manufacturing services to large governmental programs,
we usually do not work directly for agencies of the United States government.
Rather, we performs our services for large governmental contractors and large
utility companies.

Organization; Merger

      On February 24, 2006, pursuant to the Ranor Agreement, we acquired all of
the equity securities of Ranor. See "Item 1.01 Entry into Definitive Material
Agreement." As a result of the acquisition of Ranor, our business is the
business of Ranor. The stock purchase will be accounted for as a reverse
acquisition. The accounting rules for reverse acquisitions require that
beginning with the date of the merger, February 24, 2006, our balance sheet
includes the assets and liabilities of Ranor and our equity accounts were
recapitalized to reflect the net equity of Ranor. In addition, the Company's
historical operating results will be the operating results of Ranor.

      Ranor has been in business since 1956, and was sold by its founders in
1999 to Critical Components Corporation, a subsidiary of Standard Automotive
Corporation. From June 1999 until August 2002, Ranor was operated by Critical
Components Corporation. In December 2001, Standard filed for protection under
the Bankruptcy Code and operated under Chapter 11 until on or about the quarter
ended June 30, 2002. Subsequently, all Standard's holdings were sold. In 2003,
Ranor, then known as Rbran Acquisition, Inc., acquired the Ranor assets from the
bankruptcy estate. Ranor is a Delaware corporation, founded in May 2002 under
the name Rbran Acquisition, Inc. and changed its name to Ranor, Inc. in August
2002. Ranor's executive offices are located at One Bella Drive, Westminster, MA
01473, telephone (978) 874-0591. Ranor' website is http://www.ranor.com.
Information on Ranor's website or any other website is not part of this current
report on Form 8-K.

      The Company is a Delaware corporation, organized in 2005. Its executive
offices are located at One Bella Drive, Westminster, MA 01473, telephone (978)
874-0591.

                                  RISK FACTORS

      An investment in our securities involves a high degree of risk. In
determining whether to purchase our securities, you should carefully consider
all of the material risks described below, together with the other information
contained in this prospectus before making a decision to purchase our
securities. You should only purchase our securities if you can afford to suffer
the loss of your entire investment.

                                      -6-
RISKS RELATING TO OUR BUSINESS

We may require additional financing for our operations.

      The Ranor agreement required us to pay our former stockholders all of our
cash in excess of $250,000, and we used $240,000 of this amount to make payment
to the former stockholders that were due under the Ranor Agreement. As a result,
upon completion of the reverse acquisition, our cash position was $10,000. The
only funding available to us, other than our cash flow from operations, is $1.0
million revolving credit line with Sovereign Bank. We cannot assure you that
this facility will be sufficient to provide us with the funds necessary to
enable us to perform our obligations under our contracts. Our failure to obtain
any required financing could impair our ability to both serve our existing
clients base and develop new clients and could result in both a decrease in
revenue and an increase in our loss.

As a result of the reverse acquisition, our expenses will increase
significantly.

      As a result of the reverse acquisition, our ongoing expenses have
increased significantly, including expenses in compensation to Techprecision
under its management agreement and ongoing public company expenses. Our failure
to generate sufficient revenue, to reduce expenses or to obtain financing to
cover our increased level of expenses could impair our ability to continue in
business. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and "Management - Compensation" in this Item 2.01.

Our losses are continuing and we may not be able to operate provitably.

      We have shown losses for the fiscal years ended March 31, 2005 and 2004,
and such losses have continued through the nine months ended December 31, 2005.
We cannot assure you that we will be able to operate profitably, and the
additional expenses which we are incurring as a result of our status as a
reporting company under the Securities Exchange Act of 1934, as amended, may
increase the difficulty in operating profitably.

Because all of our services are performed pursuant to special order contracts,
we have no continuing source of revenue.

      We do not have long-term contracts with any customer, and major contracts
with a small number of customers accounts for a significant percentage of our
revenue. For the nine months ended December 31, 2005, our two largest customers
accounted for approximately 40% of our revenue, and each of these customers
accounted for less than 10% of our revenue in the fiscal year ended March 31,
2006. We must bid each contract separately, and when we complete a contract,
there is generally no continuing source of revenue under that contract. As a
result, we cannot assure you that we have a continuing stream of revenue. Our
failure to generate new business on an ongoing basis would materially impair our
ability to operate profitably.

                                      -7-
Because a significant portion of our revenue is derived from services rendered
from the defense, aerospace and related industries, our operating results may
suffer from conditions affecting this market.

      Substantially all of our revenue is derived from customers in the defense,
aerospace, nuclear, industrial and related industries. Our business may suffer
from any budgeting, economic or other trends that have the effect of reducing
the requirements for our services, including changes in federal budgeting which
may reduce the budget of those agencies that either engage us directly or affect
the contracts of private sector clients for whom we perform services as
subcontractors under prime contracts with government agencies.

We face significant competition from both domestic and foreign sources.

      We face competition from a number of domestic and foreign companies, some
of which are considerably larger and better capitalized than we are. For some of
our products, such as commercial nuclear canisters and machine parts, we compete
with foreign manufacturers, which have may have costs than we, which could
impact our ability to make sales of these products.

Our operating results in future periods may vary from quarter to quarter, and,
as a result, we may fail to meet the expectations of our investors and analysts,
which may cause our stock price to fluctuate or decline.

      Our revenue and operating results have fluctuated from quarter to quarter
significantly in the past. We expect that fluctuations in both revenue and net
income will continue due to a variety of factors, many of which are outside of
our control and which reflect the nature of our business. A substantial portion
of our operating expenses is related to personnel costs, depreciation and rent
which cannot be adjusted quickly and, therefore, cannot be easily reduced in
response to lower revenue levels or changes in client requirements. Due to these
factors and the other risks discussed in this current report on Form 8-K, you
should not rely on period-to-period comparisons of our results of operations as
an indication of future performance.

Our failure to meet our customers' requirement could result in decreased
revenue, increased costs and negative publicity.

      Our products require the precision manufacturing of products to very
exacting specifications which are required in the industries to which we market
our services. Our failure to meet these specifications could result in both cost
overruns on a particular contract and a loss of our reputation, which would
significantly impair our ability to generate contracts.

As a government subcontractor we are subject to government regulations.

      We must comply with complex procurement laws and regulations. If a
government review or investigation uncovers improper or illegal activities, we
may be subject to civil and criminal penalties and administrative sanctions,
including termination of contracts, forfeiture of profits, suspension of
payments and debarment from doing business with federal government agencies.

                                      -8-
Because our contracts are generally awarded through a competitive bidding
process, we cannot be assured of obtaining business.

      Our government subcontracts are usually awarded through a competitive
bidding process which entails risks not present in other circumstances. We may
spend substantial sums analyzing and preparing a bid and not be awarded a
contract. Furthermore, we may not be given the opportunity to comment on the
proposed terms of the bid, and it is possible that a bid may be tailored to meet
the specifications of a competitor. Our failure to receive contracts on which we
bid could significantly impair our ability to continue in business.

The terms on which we may raise additional capital may result in significant
dilution and may impair our stock price.

      Because of both the absence of a public market for our common stock, the
terms of our recent private placement and the number of outstanding warrants and
the exercise price and other terms on which we may issued common stock upon
exercise of the warrants, it may be difficult for us to raise additional capital
if required for our present businesses and for any planned expansion. We cannot
assure you that we will be able to get additional financing on any terms, and,
if we are able to raise funds, it may be necessary for us to sell our securities
at a price which is at a significant discount from the market price and on other
terms which may be disadvantageous to us. In connection with any such financing,
we may be required to provide registration rights to the investors and pay
damages to the investor in the event that the registration statement is not
filed or declared effective by specified dates. The price and terms of any
financing which would be available to us could result in both the issuance of a
significant number of shares and significant downward pressure on our stock
price and could result in a reduction of the conversion price of the series A
preferred stock and exercise price of the warrants held by the Barron Partners.

We may not be able to continue to grow through acquisitions.

      An important part of our growth strategy is to expand our business and to
acquire other businesses, which may or may not be related to our current
businesses. Such acquisitions may be made with cash or our securities or a
combination of cash and securities. If our stock price is less than the exercise
price of the outstanding warrants, it is not likely that that warrants will be
exercised. To the extent that we require cash, we may have to borrow the funds
or sell equity securities. The issuance of equity, if available, would result in
dilution to our stockholders. We have no commitments from any financing source
and we may not be able to raise any cash necessary to complete an acquisition.
If we fail to make any acquisitions, our future growth may be limited. As of the
date of this current report on Form 8-K, we do not have any agreement or
understanding, either formal or informal, as to any acquisition.

If we make any acquisitions, they may disrupt or have a negative impact on our
business.

      If we make acquisitions, we could have difficulty integrating the acquired
companies' personnel and operations with our own. In addition, the key personnel
of the acquired business may not be willing to work for us. We cannot predict
the affect expansion may have on our core business. Regardless of whether we are
successful in making an acquisition, the negotiations could disrupt our ongoing
business, distract our management and employees and increase our expenses. In
addition to the risks described above, acquisitions are accompanied by a number
of inherent risks, including, without limitation, the following:

                                      -9-
o     the difficulty of integrating acquired products, services or
            operations;

      o     the potential disruption of the ongoing businesses and distraction
            of our management and the management of acquired companies;

      o     the difficulty of incorporating acquired rights or products into our
            existing business;

      o     difficulties in disposing of the excess or idle facilities of an
            acquired company or business and expenses in maintaining such
            facilities;

      o     difficulties in maintaining uniform standards, controls, procedures
            and policies;

      o     the potential impairment of relationships with employees and
            customers as a result of any integration of new management
            personnel;

      o     the potential inability or failure to achieve additional sales and
            enhance our customer base through cross-marketing of the products to
            new and existing customers;

      o     the effect of any government regulations which relate to the
            business acquired;

      o     potential unknown liabilities associated with acquired businesses or
            product lines, or the need to spend significant amounts to retool,
            reposition or modify the marketing and sales of acquired products or
            the defense of any litigation, whether of not successful, resulting
            from actions of the acquired company prior to our acquisition.

      Our business could be severely impaired if and to the extent that we are
unable to succeed in addressing any of these risks or other problems encountered
in connection with these acquisitions, many of which cannot be presently
identified, these risks and problems could disrupt our ongoing business,
distract our management and employees, increase our expenses and adversely
affect our results of operations.

Risks Related to our Common Stock and the Market for our Common Stock.

The rights of the holders of common stock may be impaired by the potential
issuance of preferred stock.

      Our certificate of incorporation gives our board of directors the right to
create new series of preferred stock. As a result, the board of directors has
and in the future may, without stockholder approval, issue preferred stock with
voting, dividend, conversion, liquidation or other rights which could adversely
affect the voting power and equity interest of the holders of common stock.
Preferred stock, which could be issued with the right to more than one vote per
share, could be utilized as a method of discouraging, delaying or preventing a
change of control. The possible impact on takeover attempts could adversely
affect the price of our common stock. Although we have no present intention to
issue any additional shares of preferred stock or to create any new series of
preferred stock and the certificate of designation relating to the series A
restricts our ability to issue additional series of preferred stock, we may
issue such shares in the future.

                                      -10-
The issuance of shares through our stock compensation and incentive plans may
dilute the value of existing stockholders.

      We may use stock options, stock grants and other equity-based incentives,
to provide motivation and compensation to our officers, employees and key
independent consultants. The award of any such incentives will result in an
immediate and potentially substantial dilution to our existing stockholders and
could result in a decline in the value of our stock price.

Shares may be issued pursuant to our stock plans which may affect the market
price of our common stock.

      We may issue stock upon the exercise of options or pursuant to stock
grants covering a total of 1,000,000 shares of common stock pursuant to our 2006
long-term incentive plan. We also intend to issue 133,000 shares of restricted
stock to certain key employees. The exercise of these options and the sale of
the underlying shares of common stock and the sale of stock issued pursuant to
stock grants may have an adverse effect upon the price of our stock.

Because we are not subject to compliance with rules requiring the adoption of
certain corporate governance measures, our stockholders have limited protections
against interested director transactions, conflicts of interest and similar
matters.

      The Sarbanes-Oxley Act of 2002, as well as rule changes proposed and
enacted by the SEC, the New York and American Stock Exchanges and the Nasdaq
Stock Market as a result of Sarbanes-Oxley require the implementation of various
measures relating to corporate governance. These measures are designed to
enhance the integrity of corporate management and the securities markets and
apply to securities which are listed on those exchanges or the Nasdaq Stock
Market. Because we are not presently required to comply with many of the
corporate governance provisions and because we chose to avoid incurring the
substantial additional costs associated with such compliance any sooner than
necessary, we have not yet adopted all of these measures. Because none of our
directors are independent directors, we do not have independent audit or
compensation committees. We also are not in compliance with requirements
relating to the distribution of annual and interim reports, the holding of
stockholders meetings and solicitation of proxies for such meeting and
requirements for stockholder approval for certain corporate actions. Until we
comply with such corporate governance measures, regardless of whether such
compliance is required, the absence of such standards of corporate governance
may leave our stockholders without protections against interested director
transactions, conflicts of interest and similar matters and investors may be
reluctant to provide us with funds necessary to expand our operations.

Failure to achieve and maintain effective internal controls in accordance with
Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on
our business and operating results and stockholders could lose confidence in our
financial reporting.

      Effective internal controls are necessary for us to provide reliable
financial reports and effectively prevent fraud. If we cannot provide reliable
financial reports or prevent fraud, our operating results could be harmed. We
may be required to document and test our internal control procedures in order to
satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, which
requires increased control over financial reporting requirements, including
annual management assessments of the effectiveness of such internal controls and
a report by our independent certified public accounting firm addressing these
assessments. Failure to achieve and maintain an effective internal control
environment, regardless of whether we are required to maintain such controls,
could also cause investors to lose confidence in our reported financial
information, which could have a material adverse effect on our stock price.

                                      -11-
We do not anticipate paying dividends on our common stock.

      We are prohibited from paying dividends on our common stock while the
series A preferred stock is outstanding.

Because there is no public market for our common stock, you may have difficulty
selling common stock that you own.

      Although we are registered pursuant to the Securities Exchange Act of
1934, we have approximately 40 stockholders and there is no public market for
our common stock. None of the presently outstanding shares of common stock may
be sold except pursuant to an effective registration statement. We have agreed
to file a registration statement to enable our stockholders to sell their
shares, neither the filing of a registration statement nor the effectiveness of
the registration statement will assure a public market for out common stock.
Accordingly we cannot assure you that there will be any public market for our
common stock.

Because we may be subject to the "penny stock" rules, you may have difficulty in
selling our common stock.

      If a public market develops for our common stock and if our stock price is
less than $5.00 per shares, our stock would be subject to the SEC's penny stock
rules, which impose additional sales practice requirements and restrictions on
broker-dealers that sell our stock to persons other than established customers
and institutional accredited investors. These rules may affect the ability of
broker-dealers to sell our common stock and may affect your ability to sell any
common stock you may own.

      According to the SEC, the market for penny stocks has suffered in recent
years from patterns of fraud and abuse. Such patterns include:

      o     Control of the market for the security by one or a few
            broker-dealers that are often related to the promoter or issuer;

      o     Manipulation of prices through prearranged matching of purchases and
            sales and false and misleading press releases;

      o     "Boiler room" practices involving high pressure sales tactics and
            unrealistic price projections by inexperienced sales persons;

      o     Excessive and undisclosed bid-ask differentials and markups by
            selling broker-dealers; and

                                      -12-
o     The wholesale dumping of the same securities by promoters and
            broker-dealers after prices have been manipulated to a desired
            level, along with the inevitable collapse of those prices with
            consequent investor losses.

As an issuer of "penny stock" the protection provided by the federal securities
laws relating to forward looking statements does not apply to us.

      Although the federal securities law provide a safe harbor for
forward-looking statements made by a public company that files reports under the
federal securities laws, this safe harbor is not available to issuers of penny
stocks. As a result, we will not have the benefit of this safe harbor protection
in the event of any based upon an claim that the material provided by us,
including this current report on Form 8-K, contained a material misstatement of
fact or was misleading in any material respect because of our failure to include
any statements necessary to make the statements not misleading.

Fluctuations in our operating results and announcements and developments
concerning our business affect our stock price.

      Historically, there has been volatility in the market price for common
stock of companies such as us. Our quarterly operating results, the number of
stockholders desiring to sell their shares, changes in general economic
conditions and the financial markets, the execution of new contracts and the
termination or expiration of existing license agreements and other developments
affecting us, could cause the market price of our common stock to fluctuate
substantially. Further, since a majority of our operating expenses, particularly
personnel and related costs, depreciation and rent, are relatively fixed in
advance of any particular quarter, the underutilization of our technical
personnel may cause significant variations in our operating results in any
particular quarter and could result in losses for the quarter.

We cannot predict when or whether an active market for our common stock will
develop.

      In the absence of an active trading market, you may have difficulty buying
and selling or obtaining market quotations; the market visibility for our stock
may be limited, and the lack of visibility for our common stock may have a
depressive effect on the market price for our common stock.

Our stock price may be affected by our failure to meet projections and estimates
of earnings developed either by us or by independent securities analysts.

      Although we do not make projections relating to our future operating
results, our operating results may fall below the expectations of securities
analysts and investors. In this event, the market price of our common stock
would likely be materially adversely affected.

The registration and potential sale by our stockholders of a significant number
of shares could encourage short sales by third parties.

      The number of shares of common stock that is subject to registration
rights includes all of the 7,719,250 shares of common stock issuable on
conversion of the series A preferred stock held by Barron Partners as well as
the 11,220,000 shares of common stock issuable to Barron Partners upon exercise
of its warrants, together with the 100,000 shares of common stock owned by our
stockholders prior to the reverse acquisition. The significant downward pressure
on our stock price caused by the sale or potential sale of a significant number
of shares could cause our stock price to decline, thus allowing short sellers of
our stock an opportunity to take advantage of any decrease in the value of our
stock. The presence of short sellers in our common stock may further depress the
price of our common stock.

                                      -13-
If stockholders whose shares are being registered sell a significant
number of shares of common stock, the market price of our common stock may
decline. Furthermore, the sale or potential sale the offered shares and the
depressive effect of such sales or potential sales could make it difficult for
us to raise funds from other sources.

                           FORWARD-LOOKING STATEMENTS

      Statements in this current report on Form 8-K may be "forward-looking
statements." Forward-looking statements include, but are not limited to,
statements that express our intentions, beliefs, expectations, strategies,
predictions or any other statements relating to our future activities or other
future events or conditions. These statements are based on current expectations,
estimates and projections about our business based, in part, on assumptions made
by management. These statements are not guarantees of future performance and
involve risks, uncertainties and assumptions that are difficult to predict.
Therefore, actual outcomes and results may, and are likely to, differ materially
from what is expressed or forecasted in the forward-looking statements due to
numerous factors, including those described above and those risks discussed from
time to time in this prospectus, including the risks described under "Risk
Factors," and "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in this current report and in other documents which we
file with the Securities and Exchange Commission. In addition, such statements
could be affected by risks and uncertainties related to our ability to generate
business on an on-going business, to receive contract awards from the
competitive bidding process, maintain standards to enable us to manufacture
products to exacting specifications, enter new markets for our services, market
and customer acceptance, our ability to raise any financing which we may require
for our operations, competition, government regulations and requirements,
pricing and development difficulties, our ability to make acquisitions and
successfully integrate those acquisitions with our business, as well as general
industry and market conditions and growth rates, and general economic
conditions. Any forward-looking statements speak only as of the date on which
they are made, and we do not undertake any obligation to update any
forward-looking statement to reflect events or circumstances after the date of
this current report.

                                    BUSINESS

      We produce large metal fabrications and perform precision machining
operations for large military, commercial, nuclear, aerospace, shipbuilding and
industrial customers. Our principal services are large metal fabrications,
machining and engineering. Each of our contracts covers a specific product. We
fabricate nuclear grade steel casks, canisters and housings for the
transportation and storage of radioactive materials; we produce large
fabrications for Navy aircraft carriers, submarines and commercial vessels; and
we manufactures pulp and paper machinery, gas turbine power generation
equipment, oil refinery and utilities equipment. We are one of two companies
currently capable of machining one-piece aluminum domes for Boeing's Delta III
and Delta IV rocket programs. We do not mass-produce any products or distribute
such products on the open market.

      We perform most of our service pursuant to "build to print" contracts,
which means that we must manufacture products in accordance with very exacting
specification. These contracts are generally awarded in a bidding process.
Because of the nature of the products that we manufacture, there is a very low
tolerance for error. We will also help our clients to develop their projects by
providing engineering and research and development services. Periodically, we
will also perform research and development services for our customers as part of
a contract. However, the costs of such research and development work, is paid by
the customer. Through this periodic development work we may develop the
intellectual property to complete the project. In such cases when the work is
complete, we will own this intellectual property. However, we do not possess any
patents, trademarks, licenses, franchises, concessions or royalty agreements.

                                      -14-
Products

      All of our products are built pursuant to contracts. Because we have
lifting capacity up to 100 tons, we have the ability to manufacture very large
products that must be fabricated in a single piece. The following are examples
of recent manufacturing contracts.

      We have been the sole source for a major defense contractor for the
manufacture of housings for the defense contractor's sonar system. This system
is currently being retro-fitted onto the Navy's entire fleet of Los Angeles
Class submarines. Future installations will go on Virginia Class and SSGN Class
submarines.

      We presently provides machining services to a division of another major
defense contractor. We produce primary shield tank heads, sonar system pods and
fairings, and a variety of miscellaneous components.

      One of our customers provides a complete nuclear waste storage system to
commercial nuclear power plants. We currently manufacture lifting equipment for
this company.

      Another customer is currently involved in a variety of commercial nuclear
reactor repair and overhaul projects. We manufactured several components needed
to support this work.

Source of Supply

      Our operations are partly dependent on the availability of raw materials.
The projects that we undertake are metal fabrications and machining of various
traditional and special alloys such as inconel, titanium and high tensile
strength steels, and the customer frequently provides us with the raw material.
Some of these materials selected for given projects require long lead times to
obtain. We have worked with a number of different metal suppliers over the years
to obtain these materials, and currently works with such raw material suppliers
as: Bethlehem Lukens Plate, Process Systems International and Joseph T Ryerson
and Sons. We have multi-year relationships with these suppliers. Although some
materials (due to their alloy compositions) require long lead times to obtain,
we have never experienced a shortage of any of these materials.

Marketing

      A significant portion of our contracts result from the competitive bidding
process, which are frequently limited to pre-qualified bidders. Most of our
sales inquiries are from existing customers. We have a marketing team of six,
including a sales manager and five technical personnel which markets our
services as well as our qualifications to both existing and potential customers
through personal contacts and trade shows. We also engage an independent sales
representative.

                                      -15-
Principal Customers

      We do not have long-term contracts with any customer, and major contracts
with a small number of customers accounts for a significant percentage of our
revenue. Our customers include many of the major domestic defense and aerospace
companies. Because our services are rendered pursuant to separate contracts for
separate projects, our customer mix changes significantly from year to year. Two
customers accounted for more than 10% of our revenue in each of the nine months
ended December 31, 2005 and the fiscal years ended March 31, 2005 and 2004. Our
two largest customers for the nine months ended December 31, 2005 were the
University of Rochester, from which we recognized revenue of approximately $3.0
million (21.6% of revenue), and BAE Systems, from which we recognized revenue of
approximately $2.6 million (18.7%). For the year ended March 31, 2005, we
recognized revenue of approximately $2.7 million (18.8%) from Transnuclear, Inc.
and approximately $1.6 million (11.0%) from Battenfeld Gloucester Engineering,
Inc. For the year ended March 31, 2004, we recognized revenue of approximately
$2.3 million (21.1%) from Spincraft and approximately $1.8 million (16.9%) from
BAE Systems. No other customer accounted for 10% or more of our revenue in any
of those period.

Competition

      We face competition from a number of domestic and foreign manufacturers.
No one company dominates the industry, although many of our competitors are
larger, better known and have greater resources then we. Since many of our
contracts are awarded through a bidding process, our ability to win an award is
dependent upon a number of factors, including the price and our ability or
perceived ability to manufacture the products in accordance with specifications
and the customer's time requirements, for which our reputation as a quality
manufacturer is crucial. For certain products, being a domestic manufacturer may
be a factor. For other products, we may be undercut by foreign manufacturers who
have a lower cost of production. Further, to the extent that the bidding
proposal is based on specification which are provided by a competitor, we are at
a disadvantage in seeking to obtain that contract.

Government Regulations

      Although we do not have any contracts with government agencies, some of
our manufacturing services are provided as a subcontractor to a government
contractor. As a result, we are subject to government procurement and
acquisition regulations. Under these regulations, the government has the right
of termination for the convenience of the government and certain renegotiation
rights as well as a right of inspection. If a government review or investigation
uncovers improper or illegal activities, we may be subject to civil and criminal
penalties and administrative sanctions, including termination of contracts,
forfeiture of profits, suspension of payments and debarment from doing business
with federal government agencies. Some of the work we perform for our customers
are part of government appropriation packages, and therefore, subject to the
Miller Act, requiring the prime contractors (our customers) to pay all
subcontractors under contracted purchase agreements first.

                                      -16-
Intellectual Property Rights

      We have no patent rights. In the course of our business we develop
proprietary know-how for use in the manufacturing process. Although we have
non-disclosure policies, we cannot assure you that we will be able to protect
our intellectual property rights.

Personnel

      We currently employ 140 employees, of which 19 are administrative, eight
are engineering and approximately 113 are manufacturing personnel. None of our
employees is represented by a labor union, and we believe that are employee
relations are good.

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

      You should read the following discussion together with Financial
Statements and pro forma financial statements that are filed as exhibits to this
current report on Form 8-K.

Overview

      We operate in one distinct business - fabrication, precision machining and
engineering of metal products up to 100 tons. Most of the products are
fabricated from raw metal plate or forgings. All materials used in the
manufacturing of our products are acquired from raw material suppliers we have
worked with for many years. Our clients are generally military, shipbuilding,
national laboratories and industrial companies. Payment terms associated with
each project often include progress payments and occasionally include deposits.
Generally, payment terms are 30 to 45 days from the invoice date. A majority of
the work we perform for our customers are generally part of government
appropriation packages, and therefore, subject to the Miller Act, requiring the
prime contractors (our customers) to pay all subcontractors under contracted
purchase agreements first. Our revenues therefore are quite secure. Our gross
margins are typical for the industry.

      These products are manufactured for our clients under a build-to-print
scenario. Work is performed by our personnel under firm contracted purchase
orders, for each project undertaken at the facility. Our work is contracted
under terms that require down payments for the acquisition of materials.
Additionally, depending on the length of a given project, some contracts require
progress payments based on major milestones of work completed.

      From June 1999 until 2002, Ranor's business was conducted by a subsidiary
of Standard Automotive Corporation. In December 2001, Standard filed for
protection under the Bankruptcy Code and operated under Chapter 11. We acquired
the Ranor assets from the bankruptcy estate. However, as a result of the
bankruptcy, our customers were initially reluctant to use our services. In
recent years, as both the market for our services has improved and we have
demonstrated to our customers that we have both the financial and manufacturing
ability to meet their specifications and time requirements, we have been able to
improve both our revenue and our gross margin.

Critical Accounting Policies

      The preparation of the Company's financial statements conform to the
generally accepted accounting principles in the United States and requires our
management to make assumptions, estimates and judgments that effect the amounts
reported in the financial statements, including all notes thereto, and related
disclosures of commitments and contingencies, if any. We rely on historical
experience and other assumptions we believe to be reasonable in making our
estimates. Actual financial results of the operations could differ materially
from such estimates. There have been no significant changes in the assumptions,
estimates and judgments used in the preparation of our audited financial
statements from the assumptions, estimates and judgments used in the preparation
of our 2004 audited financial statements.

                                      -17-
Revenue Recognition

      We derive revenues from (i) the fabrication of large metal components for
our customers; (ii) the precision machining of such large metal components;
(iii) engineering services relating to the constructability of these products,
and (iv) the installation of such components at the customers' locations when
the scope of a given project requires such installations.

      Our cost containments system is set up to track our operations is the
"units of delivery method," otherwise known as "work in process" method.
Accordingly, income is recognized at the time at which a unit under contract is
completed and delivered to the customer. We have a firm purchase order or
contract for each project we undertake. Contracts for work to be performed are
negotiated per project and sometimes require a customer deposit to begin such
work. We generally use the customer's deposit to purchase the necessary raw
material for the project. Depending on the length of the project, we could
require progress payments based on milestones of completion as stipulated in the
contract. Such deposits and progress payments are treated as offsets to costs
incurred on uncompleted contracts.

Income Taxes

      Our fiscal year ends on March 31st. We provide for federal and state
income taxes currently payable, as well as those deferred because of temporary
differences between reporting income and expenses for financial statement
purposes versus tax purposes. Deferred tax assets and liabilities are recognized
for the future tax consequences attributable to differences between carrying
amount of assets and liabilities for financial reporting purposes and the
amounts used for income tax purposes. Deferred tax assets and liabilities are
measured using the enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be recoverable and or
settled. The effect of the change in the tax rates is recognized as income or
expense in the period of the change. A valuation allowance is established, when
necessary, to reduce deferred income taxes to the amount that is more likely
than not to be realized. As of March 31, 2005, we had net operating loss
carry-forwards approximating $3,470,000. Pursuant to Section 382 of the Internal
Revenue Code, utilization of these losses may be limited in the event of a
change in control, as defined in the Treasury Regulations. The change in
ownership resulting from our acquisition of Ranor will limit our ability to use
the loss carryforwards.

New Accounting Pronouncements

      In November 2004, the FASB issued SFAS No. 151 "Inventory Costs, an
amendment of Accounting Research Bulletin ("ARB") No. 43, Chapter 4." The
amendments made by Statement 151 clarify that, abnormal amounts of idle facility
expense, freight, handling costs and wasted materials (spoilage) should be
recognized as current-period charges and require the allocation of fixed
production overheads to inventory based on the normal capacity of the production
facilities. The guidance is effective for inventory costs incurred during the
fiscal years beginning after June 15, 2005.

                                      -18-
In December 2004, The FASB issued SFAS No. 153, "Exchanges of Nonmonetary
Assets, an amendment of APB Opinion No. 29, Accounting for Nonmonetary
Transactions" ("SFAS 153"). The amendments made by SFAS 153 as based on the
principle that exchanges of nonmonetary assets should be measured based on the
fair value of the assets exchanged. Further, the amendments eliminate the narrow
exception for nonmonetary exchanges of similar productive assets and replace it
with a broader exception for exchanges of nonmonetary assets that do not have
commercial substance. Previously, Opinion 29 required that the accounting for an
exchange of a productive asset should be based on the recorded amount of the
asset relinquished. Opinion 29 provided for an exception to its basic
measurement principle (fair value) for exchanges of similar productive assets.
The Board believes that exception required that some nonmonetary exchanges,
although commercially substantive, be recorded on a carry over basis. By
focusing the exception on exchanges that lack commercial substance, the Board
believes this Statement produces financial reporting that more faithfully
represents the economics of the transaction. The Statement is effective for
nonmonetary asset exchanges occurring in fiscal periods beginning after June 15,
2005. Earlier application is permitted for nonmonetary asset exchanges occurring
in fiscal periods beginning after the date of issuance. The provision of this
statement shall be applied prospectively.

      In December 2004, the FASB issued SFAS No.123 (revised 2004), "Share-Based
Payment." Statement 123R will provide investors and other users of financial
statements with more complete financial information by requiring that the
compensation cost relating to share-based payment transactions be recognized in
financial statements. That cost will be measured based on the fair value of the
equity or liability instruments issued. Statement 123R covers a wide range of
share-based compensation arrangements including stock options, restricted stock
plans, performance-based awards, stock appreciation rights, and employee stock
purchase plans. Statement 123R replaces FASB Statement No. 123, Accounting for
Stock-Based Compensation, and supersedes APB Opinion No. 25, Accounting for
Stock Issued to Employees. Statement 123, as originally issued in 1995,
established as preferable a fair-value-based method of accounting for
share-based payment transactions with employees. However, that statement
permitted entities the option of continuing to apply the guidance in Opinion 25,
as long as the footnotes to financial statements disclosed what net income would
have been had the preferable fair-value-based method been used. Public entities
that are small business issuers will be required to apply Statement 123R as of
the first interim or annual reporting period that begins after December 15,
2005, which, for us, will be the quarter beginning April 1, 2006. Prior to the
reverse acquisition, we did not grant any options or equity-based incentives. To
the extent that we grant such options or other equity-based incentives, the
value thereof will be included an a general and administrative expense.

      We expect that the adoption of the foregoing new statements will not have
a significant impact on our financial statements.

Results of operations

      The following table sets forth our statements of operations for the nine
months ended December 31, 2005 and 2004 and the years ended March 31, 2005 and
2004, as a percentage of revenue:

                                      -19-
Nine Months Ended December 31,        Fiscal Year Ended March 31,
                                                              ------------------------------        ---------------------------
                                                                     2005              2004            2005           2004
                                                                     ----              ----            ----           ----
Sales                                                              100.0%            100.0%          100.0%         100.0%
Cost of sales(1)                                                    83.8%             88.6%           85.7%          89.2%
Gross profit                                                        16.2%             11.4%           14.3%          10.8%
Selling, general and administrative costs                           10.4%             11.6%           11.7%          11.9%
Earnings before interest, taxes, depreciation,                       5.8%             -0.2%            2.7%          -4.7%
amortization and cumulative change in accounting
principle
Interest expense (net)                                               6.1%              7.9%            7.8%           9.9%
Depreciation                                                         2.3%              2.9%            2.9%           3.6%
Cumulative effect of change in accounting                              0%                0%              0%           0.5%
principle
Income taxes                                                            *                 *               *              *
Net income                                                          -2.5%            -11.0%           -8.0%         -18.8%
*        Less than 0.5%

(1) Cost of sales does not include depreciation or amortization.

Nine Months Ended December 31, 2005 and 2004

      Sales in the nine months ended December 31, 2005 (the "December 2005
period") increased $3,175,471, or 30%, to $13,713,739, compared to $10,538,268
for the nine months ended December 31, 2004 (the "December 2004 period"). This
increase reflected both an improvement in the market for our services following
a downturn in this market in response to the events of September 11, 2001 and a
continued acceptance of us as a supplier following the bankruptcy of Standard
Automotive.

      Our cost of sales for the December 2005 period increased $1,852,404, to
$11,494,666, an increase of 19%, from $9,642,262 in the December 2004 period.
This increase was significantly less than the increase in sales, resulting in an
improvement in the gross margin from 8.5% to 16.2%. The increase resulted from
more efficient operations. In the December 2004 period, we were not able to
utilize our manufacturing personnel efficiently, since we were staffed to
manufacture more products than we had orders. As a result, our direct labor, as
a percentage of sales, decreased from 23.7% to 19.7%.

      Selling, administrative and other expenses for the December 2005 period
were $1,421,605, compared to $1,220,311 for the first nine months of 2004, an
increase of $201,294, or 16%. Significant components of selling, general and
other expenses for the December 2005 period includes $1,080,085 of salaries and
related payroll taxes, $53,935 of travel and entertainment expenses and $65,445
for legal, consulting and accounting fees. The increase in selling, general and
administrative also reflected payroll costs resulting, in part, from the
employment of one of the former Ranor stockholders as our president.

      The Company's interest expense during the December 2005 period was
$840,849 compared to $841,065 for the December 2004 period.

                                      -20-
As a result of the foregoing, our net loss for the December 2005 period
was $347,870, as compared to a loss of $1,163,678 for the December 2004 period.

Fiscal Years Ended March 31, 2005 and 2004

      Sales for the fiscal year ended March 31, 2005 ("fiscal 2005") increased
$3,337,065, or 31%, to $14,269,982, compared to $10,932,917 for the fiscal year
ended March 31, 2004 ("fiscal 2004"). This increase, like the increase in sales
for the December 2005 period, reflected both an improvement in the market for
our services following a downturn in this market in response to the events of
September 11, 2001 and a greater acceptance of us as a supplier following the
bankruptcy of Standard Automotive.

      Our cost of sales for fiscal 2005 period increased $2,483,370, or 24%,
from 10,148,270 to 12,631,640. This increase was less than the increase in
sales, resulting in an improvement in the gross margin from 7.2% to 11.5%. The
increase resulted from more efficient operations, although we continued to have
operating inefficiencies during fiscal 2004 as a result of our level of sales.
As a result, our direct labor, as a percentage of sales, decreased from 25.71%
to 21.83%

      Selling, administrative and other expenses for fiscal 2005 were
$1,664,847, compared to $1,691,748 for fiscal 2004, a decease of $26,901, or 2
%. Significant components of selling, general and other expenses for the fiscal
2005 period include $1,203,273 of salaries and related payroll taxes, $32,748 of
travel and entertainment expenses and $169,390 for legal, consulting and
accounting fees.

      The Company's interest expense was unchanged from fiscal 2004 to fiscal
2005.

      During fiscal 2004 we had an accounting change related to the manner in
which we recognize revenue in the amount of $56,142. There was no comparable
charge in fiscal 2005.

      As a result of the foregoing, our net loss for fiscal 2005 was $1,143,800,
as compared to a loss of $2,055,304 for fiscal 2004.

Liquidity and Capital Resources

      At December 31, 2005, we had working capital of approximately $3,316,050,
including $777,950 of cash. Pursuant to the Ranor Agreement, which was closed on
February 24, 2006, we were required to pay the former stockholders of Ranor an
amount equal to our cash position in excess of $250,000. We also paid $240,000
of the remaining cash as part of the purchase price due to the former
stockholders, which reduced our cash balance to $10,000. The total amount paid
to the former Ranor stockholders was $1,053,000, comprised of $813,000, being
the cash in excess of $250,000, and $240,000, being a payment from the remaining
cash.

      In the December 2005 period, we had negative cash flow from operations of
$363,965, which is a significant improvement from a negative cash flow from
operations of $900,595 for the year ended March 31, 2005. We attribute this
improvement to our ability to increase both our revenue and gross margin in the
December 2005 period as described under "Results of Operations." However, as a
result of the reverse acquisition, we have additional expenses, including
$200,000 pursuant to a management agreement with Techprecision, as well as
additional expenses which we will incur as a public company. Offsetting these
cost increases is the elimination of compensation that was paid to the former
stockholders of Ranor.

                                      -21-
In the normal course of our business, we required funds to enable us to
complete our contracts. While we generally receive a deposit, we typically use
that deposit to purchase raw materials required for the contract, and fund our
operations from working capital. Contemporaneously with the reverse acquisition,
we entered into an agreement with Sovereign Bank pursuant to which we borrowed
$4,000,000 on a term loan basis, and we obtained a $1,000,000 revolving credit
facility. We used the net proceeds from the $4,000,000 term loan to pay a
portion of our obligations to the former Ranor stockholders under the Ranor
Agreement. While we believe that the $1,000,000 revolving credit facility and
our cash flow from our operations should be sufficient to enable us to satisfy
our cash requirements at least through the end of 2006, it is possible that we
may require additional funds. We have no commitment from any party for
additional funds, and the terms of our agreement with Barron Partners may impair
our ability to raise capital in the equity markets.

Item 3. Description of Property.

      We lease from WM, an approximately 136,000-square foot office and
manufacturing facility at One Bella Drive, Westminster, Massachusetts 01473,
pursuant to a 15-year lease that expires February 28, 2021, at an annual rental
of $438,000, subject to annual escalations. The lease provides for two five-year
extension and a purchase option at appraised value. We sold the real estate to
WM contemporaneously with the reverse acquisition for $3.0 million. In
connection with WM's financing of the real estate, we agreed to an increase in
the rental in the event of a default by WM under its mortgage.

Item 4. Security Ownership of Certain Beneficial Owners and Management.

      The following table provides information as to shares of common stock
beneficially owned as of February 28, 2006 by:

      o     each director;

      o     each officer named in the summary compensation table;

      o     each person owning of record or known by us, based on information
            provided to us by the persons named below, to own beneficially at
            least 5% of our common stock; and

      o     all directors and executive officers as a group.

                                      Shares of Common Stock
Name                                       Beneficially Owned      Percentage
----                                       ------------------      ----------

James G. Reindl                                     2,945,300           29.6%
One Bella Drive
Westminster, MA 01473

Andrew A. Levy                                      2,925,300           29.3%
900 Third Avenue
New York, New York 10022

Stanoff Corporation                                 1,700,000           17.1%
805 Third Avenue
New York, NY 10022

                                      -22-
Robert Lifton                                       1,000,000           10.0%
805 Third Avenue
New York, NY 10022

Howard Weingrow                                     1,000,000           10.0%
805 Third Avenue
New York, NY 10022

Stanley A. Youtt                                      796,000            8.0%
One Bella Drive
Westminster, MA 01473

Martin M. Daube                                       741,400            7.4%
20 West 64th Street
New York, NY 10023

Larry Steinbrueck                                     204,000            2.0%

Michael Holly                                          85,000               *

Louis A. Winoski                                          -0-             -0-

All officers and directors as a group (five         4,040,300           40.5%
individuals owning stock)

*     Less than 1%

      Except as otherwise indicated each person has the sole power to vote and
dispose of all shares of common stock listed opposite his name. Each person is
deemed to own beneficially shares of common stock which are issuable upon
exercise or warrants or options or upon conversion of convertible securities if
they are exercisable or convertible within 60 days of February 28, 2006.

      The shares owned by Andrew A. Levy represent 2,675,300 shares of common
stock owned by him and 250,000 shares of common stock owned by Redstone Capital
Corporation, of which Mr. Levy is president and sole stockholder.

      Robert Lifton and Howard Weingrow each own a 50% interest in Stanoff
Corporation. The 1,000,000 shares of common stock beneficially owned by each of
them represents 150,000 shares of common stock owned in his individual name and
50% of the 1,700,000 shares of common stock owned by Stanoff Corporation.

      Stanley A. Youtt has an agreement with Mr. Levy, Mr. Reindl and Mr. Daube
pursuant to which they will transfer to Mr. Youtt an aggregate of 796,000 shares
of common stock in the event that we do not make an acquisition meeting certain
agreed-upon criteria within one year from February 24, 2006, the date we
acquired Ranor.

      Barron Partners owns shares of series A preferred stock and warrants
which, if fully converted or exercised, would result in ownership of more than
5% of our outstanding common stock. However, the series A preferred stock may
not be converted and the warrants may not be exercised if such conversion would
result in Barron Partners owning more than 4.9% of our outstanding common stock.
This limitation may not be waived. As a result, Barron Partners does not
beneficially own 5% or more of our common stock.

                                      -23-
Item 5. Directors and Executive Officers, Promoters and Control Persons.

Directors and Executive Officers

       Name             Age       Position
James G. Reindl         47        Chairman and chief executive officer
Mary Desmond            42        Chief financial officer and secretary
Stanley A. Youtt        59        Director; president and chief executive
                                   officer of Ranor
Michael Holly(1)        59        Director
Larry Steinbrueck(1)    54        Director
Louis A. Winoski(1)     59        Director

(1)   Member of the audit and compensation committees.

      Mr. Reindl has been a director, chairman and chief executive officer since
February 2006. Mr. Reindl is president of Techprecision, LLC, a company that was
formed in 2002 to acquire, manage and develop smaller to mid-sized companies in
the aerospace, military and precision manufacturing industry sectors.
Techprecision has a management agreement with us, and Mr. Reindl devotes
substantially all of his business time and attention to our business. From
February 1999 until February 2002, Mr. Reindl was president and chief executive
officer of Critical Components Corporation, an aerospace subsidiary of Standard
Automotive Corporation. During that period, Ranor was a wholly-owned subsidiary
of Critical Components. Mr. Reindl received his Bachelor of Science degree in
mechanical aerospace engineering from the University of Delaware.

      Ms. Desmond has been our chief financial officer since February 2006, and
she has been the chief financial officer of Ranor since 1998. Ms. Desmond
obtained her Bachelor of Science degree in accounting from Franklin Pierce
College and she received her Masters of Business (MBA) from Fitchburg State
College.

      Mr. Youtt has been a director since March 2006, and he has been chief
executive officer of Ranor since 2000. Mr. Youtt received a Bachelor of Science
degree in naval architecture and marine engineering from the University of
Michigan and Masters Degree in civil engineering (applied mechanics) from the
University of Connecticut.

      Mr. Holly has been a director since March 2006. Since 2004, Mr. Holly has
been a private investor and consultant. From 1996 until 2004, Mr. Holly was
managing director of Safeguard International Fund, L.P., a private equity fund
of which Mr. Holly is a founding partner. Mr. Holly has a Bachelor of Science
degree in economics from Mount St. Mary's College.

      Mr. Steinbrueck has been a director since March 2006. Since 1991, Mr.
Steinbrueck has been president of MidWest Capital Group, an investment banking
firm. Mr. Steinbrueck has a Bachelor of Science degree in business and a Masters
in Business Administration from the University of Missouri.

      Mr. Winoski has been a director since March 2006. Since August 2005, Mr.
Winoski has been a consultant to Garner CAD Technic GmbH, an aerospace
engineering and design services company. From August 2004 to August 2005, Mr.
Winoski was managing director, chairman of the board and member of the holding
company board for RSM Fabrications Ltd., a fabricator of aerospace products.
From March 2002 until July 2004, Mr. Winoski was a consultant and director of
global marketing for PFW GmbH, a producer of components for commercial aircraft.
From December 1999 to February 2002, Mr. Winoski was president and chief
executive officer of Tubetronics Inc., a producer of spare parts for Boeing
commercial aircraft and other aerospace products. Mr. Winoski is also managing
partner of Homeric Partners, LLC, a management consulting business. Mr. Winoski
has a Bachelor of Science degree in industrial and systems management
engineering from Pennsylvania State University.

                                      -24-
Board Committees

         The board of directors has two committees, the audit committee and the
compensation committee. Michael Holly, Larry Steinbrueck and Louis Winoski, each
of whom is an independent director, are the members of both committees. Mr.
Holly is the audit committee financial expert.

Item 6.  Executive Compensation.

                           SUMMARY COMPENSATION TABLE

         Prior to the reverse merger, we did not pay any compensation to any
executive officers. Set forth below is information for the fiscal year ended
March 31, 2005 for Ranor's chief executive officer and for our other executive
officers whose salary for the fiscal year was at least $100,000.

                                                                      Other
Name and Position                          Year        Salary     Compensation
-----------------                          ----        ------     ------------
Stanley A. Youtt, chief executive          2005      $198,016              -0-
officer
Jeffrey Lippincott, Secretary              2005       150,000              -0-
Daniel Justicz, Treasurer                  2005       150,000              -0-

      Mr. Lippincott and Mr. Justicz are former stockholders of Ranor and are no
longer employed by us or Ranor.

Employment Agreement

      In February 2006, Ranor entered into an employment agreement with Stanley
A. Youtt pursuant to which he would serve as our chief executive officer for a
term of three year term ending on February 28, 2009. Pursuant to the agreement,
we pay Mr. Youtt salary at the annual rate of $200,000. Mr. Youtt is also
eligible for performance bonuses based on financial performance criteria set by
the board. In the event that we terminate Mr. Youtt's employment without cause,
we are required to make a lump-sum payment to him equal to his base compensation
for the balance of the term and to provide the insurance coverage that we would
provide if he remained employed.

Management Agreement

      Pursuant to a management agreement with Techprecision LLC, we engaged
Techprecision to manage our business through March 31, 2009. The agreement
provides that we pay Techprecision an annual management fee of $200,000 and a
performance bonus based on criteria determined by the compensation committee.
Mr. Reindl is the manager of Techprecision, and he, Andrew A. Levy and Martin M.
Daube are the members of Techprecision. The agreement provides that
Techprecision will provide the services of Mr. Reindl at chairman, Mr. Levy for
marketing support and analysis of long-term contracts and Mr. Daube for
marketing support. None of the members of Techprecision receive any additional
compensation from us.

                                      -25-
2006 Long-Term Incentive Plan

      In February 2006, we adopted, subject to stockholder approval, the 2006
long-term incentive plan covering 1,000,000 shares of common stock. The plan
provides for the grant of incentive and non-qualified options, stock grants,
stock appreciation rights and other equity-based incentives to employees,
including officers, and consultants. The 2006 Plan is to be administered by a
committee of not less than two directors each of which is to be an independent
directors. In the absence of a committee, the plan is administered by the board
of directors. Independent directors are not eligible for discretionary options.
However, each newly elected independent director receives at the time of his
election, a five-year option to purchase 25,000 shares of common stock at the
market price on the date of his or her election. In addition, the plan provides
for the annual grant of an option to purchase 5,000 shares of common stock on
July 1st of each year, commencing July 1, 2007. Pursuant to this plan, we
granted incentive stock options to our three independent directors -- Michael
Holly, Larry Steinbrueck and Louis Winoski. The options are subject to
stockholder approval of the 2006 Plan.

      We also have reserved 133,000 shares of common stock for issuance to key
managerial employees as restricted stock grants.

Item 7. Certain Relationships and Related Transactions.

      In connection with the reverse acquisition, we sold the real property on
which our facilities are located to WM for $3.0 million. WM is a special purpose
entity which was created in order to acquire the real estate. WM is beneficially
owned by Newvision Westminster LLC, of which Andrew A. Levy, a principal
stockholder and a member of Techprecision, is the manager and a 69% beneficial
owner. Mr. James G. Reindl, our chairman, chief executive officer and a
director, is a 10% beneficial owner of Newvision. Larry Steinbreuck and Michael
Holly, who are directors, own 1.2% and 0.5% respectively. Other principal
stockholders who are members of Newvision are Stanoff Corporation (10%) and
Martin Daube (7.8%). The property that we sold includes the real estate on which
our facilities are located and three potential residential lots, which are
presently vacant. We lease the real estate on which our facilities are located
(and not the potential residential lots) pursuant to a triple net lease at an
current annual rental of $438,000, subject to escalation. See "Item 3.
Description of Property" for information relating to this lease. Although we
believe that the terms of the sale and the lease are fair to us, the purchase
price is less than the appraised value of the property and the terms of neither
the sale nor the lease were negotiated at arms length. The purchase price was
based largely upon the maximum amount that WM could borrow and reflected the
fact that the use of the real estate as a manufacturing facility would not be
considered the best use of the property.

      In connection with the mortgage on the real estate, Mr. Levy and Mr.
Reindl gave the mortgagee their personal limited guarantee and an environmental
guaranty. The limited guaranty is triggered by certain defaults by WM under its
mortgage.

                                      -26-
In connection with the mortgage, we paid certain of WM's costs and
expenses of approximately $150,000, which amount is payable by WM within three
years.

      Prior to the completion of the reverse acquisition, Techprecision advanced
us $120,000 for expenses relating to the reverse acquisition. These expenses
were paid in February 2006.

      Mr. Stanley A. Youtt was a common stockholder of Ranor. Pursuant to the
Ranor Agreement, he, along with the other former Ranor stockholders, sold his
Ranor stock to us. Since the consideration paid was used to pay debt and the
preference of the preferred stockholders, the total amount paid to Mr. Youtt was
$700.

Item 8. Description of Securities.

      We are authorized to issue 90,000,000 shares of common stock, par value
$.0001 per share, and 10,000,000 shares of preferred stock, par value $.0001 per
share. As of February 28, 2006, we had we 17,686,259 shares of common stock and
7,719,250 shares of series A preferred stock outstanding.

      The following summary of certain provisions of our common stock, preferred
stock, certificate of incorporation and by-laws is not intended to be complete.
It is qualified by reference to the provisions of applicable law and to our
certificate of incorporation and by-laws.

Common Stock

      Holders of common stock are entitled to one vote for each share held on
all matters submitted to a vote of stockholders and do not have cumulative
voting rights. Accordingly, holders of a majority of the shares of common stock
entitled to vote in any election of directors may elect all of the directors
standing for election. Holders of common stock are entitled to receive
proportionately any dividends as may be declared by our board of directors,
subject to any preferential dividend rights of outstanding preferred stock.
Pursuant to the certificate of designation relating to the series A preferred
stock, we are prohibited from paying dividends on our common stock while the
preferred stock is outstanding. Upon our liquidation, dissolution or winding up,
the holders of common stock are entitled to receive proportionately our net
assets available after the payment of all debts and other liabilities and
subject to the prior rights of any outstanding preferred stock. Holders of
common stock have no preemptive, subscription, redemption or conversion rights.
Our outstanding shares of common stock are fully paid and non-assessable. The
rights, preferences and privileges of holders of common stock are subject to,
and may be adversely affected by, the rights of the holders of shares of any
series of preferred stock that we may designate and issue in the future.

Preferred Stock

      Our certificate of incorporation gives our board of directors the power to
issue shares of preferred stock in one or more series without stockholder
approval. Our board of directors has the discretion to determine the rights,
preferences, privileges and restrictions, including voting rights, dividend
rights, conversion rights, redemption privileges and liquidation preferences, of
each series of preferred stock. The purpose of authorizing our board of
directors to issue preferred stock and determine its rights and preferences is
to eliminate delays associated with a stockholder vote on specific issuances.
The issuance of preferred stock, while providing desirable flexibility in
connection with possible acquisitions and other corporate purposes, could have
the effect of making it more difficult for a third party to acquire, or could
discourage a third party from acquiring, a majority of our outstanding voting
stock. Except for the series A preferred stock, we have no present plans to
issue any shares of preferred stock.

                                      -27-
Series A Preferred Stock

      The certificate of designation for the series A preferred stock provides
that:

      o     Each share of series A preferred stock is convertible into two
            shares of common stock.

      o     If, while Barron Partners owns shares of series A preferred stock,
            we issues common stock at a price, or options, warrants or other
            convertible securities with a conversion or exercise price less than
            the conversion price (initially $.285 per share), with certain
            specified exceptions, the number of shares issuable upon conversion
            of one share of series B preferred stock is adjusted to reflect a
            conversion price equal to the lower price.

      o     If our earnings before interest, taxes, depreciation and
            amortization, computed as provided in the Preferred Stock Agreement
            ("EBITDA") per share for the fiscal year ended March 31, 2006, are
            less than $0.06591 per share, the conversion price shall be reduced
            proportionately by up to 15%. The full 15% adjustment will be made
            if EBITDA per share is $.04613 or less.

      o     If our EBITDA per share for the fiscal year ended March 31, 2007,
            are less than $.08568 per share, the conversion price shall be
            reduced proportionately by up to 15%. The full 15% adjustment will
            be made if EBITDA per share is $.05997 or less.

      o     No dividends are payable with respect to the series A preferred
            stock.

      o     While the series A preferred stock is outstanding, we may not pay
            dividends on or redeem shares of common stock.

      o     Upon any voluntary or involuntary liquidation, dissolution or
            winding-up, the holders of the series A preferred stock are entitled
            to a preference of $.285 per share before any distributions or
            payments may be made with respect to the common stock or any other
            class or series of capital stock which is junior to the series A
            preferred stock upon voluntary or involuntary liquidation,
            dissolution or winding-up.

      o     The holders of the series A preferred stock have no voting rights.
            However, so long as any shares of series A preferred stock are
            outstanding, we shall not, without the affirmative approval of the
            holders of 75% of the outstanding shares of series A preferred stock
            then outstanding, (a) alter or change adversely the powers,
            preferences or rights given to the series A preferred stock or
            alter, (b) authorize or create any class of stock ranking as to
            dividends or distribution of assets upon liquidation senior to or
            otherwise pari passu with the series A preferred stock, or any of
            preferred stock possessing greater voting rights or the right to
            convert at a more favorable price than the series A preferred stock,
            (c) amend its certificate of incorporation or other charter
            documents in breach of any of the provisions hereof, (d) increase
            the authorized number of shares of series A preferred stock, or (e)
            enter into any agreement with respect to the foregoing.

                                      -28-
o     The holders of the series A preferred stock may not convert the
            series A preferred stock to the extent that such conversion would
            result in the holders owning more than 4.9% of the outstanding
            Common Stock. This limitation may not be amended or waived.

Proposed Amendment to our Certificate of Incorporation

      Pursuant to the Preferred Stock Agreement with Barron Partners, our board
of directors approved, and authorized the submission to stockholders at the next
annual or special meeting, an amendment to our certificate of incorporation to
add the following provision:

      "The terms and conditions of any rights, options and warrants approved by
the Board of Directors may provide that any or all of such terms and conditions
may be waived or amended only with the consent of the holders of a designated
percentage of a designated class or classes of capital stock of the Corporation
(or a designated group or groups of holders within such class or classes,
including but not limited to disinterested holders), and the applicable terms
and conditions of any such rights, options or warrants so conditioned may not be
waived or amended absent such consent."

Delaware Law and Certain Charter and By-law Provisions

      We are subject to the provisions of Section 203 of the Delaware General
Corporation Law statute. Section 203 prohibits a publicly-held Delaware
corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years after the person became an interested
stockholder, unless the business combination is approved in a prescribed manner.
A "business combination" includes mergers, asset sales and other transactions
resulting in a financial benefit to the interested stockholder. Subject to
certain exceptions, an "interested stockholder" is a person who, together with
affiliates and associates, owns, or within the prior three years did own, 15% or
more of the corporation's voting stock.

      Our certificate of incorporation contains certain provisions permitted
under Delaware General Corporation Law relating to the liability of directors.
The provisions eliminate a director's liability for monetary damages for a
breach of fiduciary duty, except in certain circumstances where such liability
may not be eliminated under applicable law. Further, our certificate of
incorporation contains provisions to indemnify our directors and officers to the
fullest extent permitted by Delaware General Corporation Law.

                                     PART II

Item 1. Market Price of and Dividends on the Registrant's Common Equity and
Related Stockholder Matters.

      There is no public marker for our common stock, and we have not paid
dividends. Our agreement with Barron Partners and the certificate of designation
relating to the series A preferred stock prohibit our payment of dividends while
shares of series A preferred stock are outstanding.

      As of February 28, 2006, we had approximately 50 stockholders of record.
At that date, we had 17,686,259 shares of common stock outstanding, none of
which may be sold pursuant to Rule 144. The 100,000 shares that were outstanding
prior to the reverse acquisition were issued at a time when we were a shell
company, and those shares, under an interpretation from the SEC relating to
shares issued by a shell company, may not be sold pursuant to Rule 144, and must
be registered for sale.

                                      -29-
As of February 28, 2006, we had the following shares of common stock
reserved for issuance:

      o     7,719,250 shares issuable upon conversion of the series A preferred
            stock.

      o     11,220,000 shares issuable upon exercise of the warrants issued to
            Barron Partners.

      o     1,000,000 shares issuable upon exercise of stock options or other
            equity-based incentives pursuant to our 2006 long-term incentive
            plan, which is subject to stockholder approval.

      o     133,000 shares to be issued as restricted stock grants to key
            employees.

Equity Compensation Plan Information

      The following table summarizes the equity compensation plans under which
our securities may be issued as of February 28, 2006.
Number of securities to be     Weighted-average          Number of securities
                                           issued upon exercise of        exercise price of         remaining available for
                                           outstanding options and        outstanding options and   future issuance under
      Plan Category                        warrants                       warrants                  equity compensation plans
      -------------                        --------                       --------                  -------------------------
Equity compensation plans approved by            -0-                                --                          --
security holders

Equity compensation plan not approved by      75,000                         $.285                    1,208,000
security holders
The 2006 long-term incentive plan was approved by the board of directors,
subject to stockholder approval, and the outstanding options are subject to
stockholder approval of the plan. The plan has not yet been submitted to the
stockholders for their approval. We also have a plan for the issuance of 133,000
shares of commons stock to key employees as restricted stock grant.

Item 2. Legal Proceedings.

      We are not a defendant in any material legal proceedings.

Item 3. Changes in and Disagreements with Accountants.

      See Item 4.01 of this Form 8-K for information relating to the change in
our independent accountants.

                                      -30-
Item 4. Recent Issuances of Unregistered Securities.

      See Item 3.02 of this Form 8-K for information relating to recent
issuances of unregistered securities.

Item 5. Indemnification of Officers and Directors.

      Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses including attorneys' fees, judgments, fines and
amounts paid in settlement in connection with various actions, suits or
proceedings, whether civil, criminal, administrative or investigative other than
an action by or in the right of the corporation, a derivative action, if they
acted in good faith and in a manner they reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, if they had no reasonable cause to believe their
conduct was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses including
attorneys' fees incurred in connection with the defense or settlement of such
actions, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's certificate of
incorporation, bylaws, agreement, a vote of stockholders or disinterested
directors or otherwise.

      Our Certificate of Incorporation provides that we will indemnify and hold
harmless, to the fullest extent permitted by Section 145 of the Delaware General
Corporation Law, as amended from time to time, each person that such section
grants us the power to indemnify.

      The Delaware General Corporation Law permits a corporation to provide in
its certificate of incorporation that a director of the corporation shall not be
personally liable to the corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, except for liability for any breach
of the director's duty of loyalty to the corporation or its stockholders; acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law; payments of unlawful dividends or unlawful stock
repurchases or redemptions, or any transaction from which the director derived
an improper personal benefit.

      Our certificate of incorporation provides that, to the fullest extent
permitted by applicable law, none of our directors will be personally liable to
us or our stockholders for monetary damages for breach of fiduciary duty as a
director. Any repeal or modification of this provision will be prospective only
and will not adversely affect any limitation, right or protection of a director
existing at the time of such repeal or modification.

      Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers and controlling persons pursuant
to the foregoing provisions, or otherwise, we have been advised that in the
opinion of the SEC such indemnification is against public policy as expressed in
the Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than director, officer or
controlling person in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with
the securities being registered, we will, unless in the opinion of our counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by us is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.

                                      -31-
PART F/S

      Reference is made to the filings by Lounsberry on Form 10SB-A and 10-QSB
for Lounsberry's financial statements.

      The financial statements of Ranor begin on Page F-1.

      The pro forma financial information is filed as Exhibit 99.X to this Form
8-K.

                                    PART III

      The exhibits are listed and described in Item 9.01 of this Form 8-K.

Item 3.02. Unregistered Sale of Equity Securities.

      In January 2006, we sold 8,000 shares of common stock to 40 investors in a
private placement, from which we received proceeds of $2,000.

      On February 24, 2006, we issued the following securities:

      o     Pursuant to the Preferred Stock Agreement, we sold to Barron
            Partners for $2,200,000, (i) 7,719,250 shares of series A preferred
            stock, and (ii) warrants to purchase 11,220,000 shares of common
            stock, of which warrants to purchase 5,610,000 shares have an
            exercise price of $.55 per share, warrants to purchase 5,610,000
            shares have an exercise price of $.855 per share.

      o     Pursuant to the Acquisition Company Agreement, we issued to the
            former members of Ranor Acquisition an aggregate of 7,697,000 shares
            of common stock.

      o     Pursuant to a subscription agreement, we issued 1,700,000 shares of
            common stock for $500,000.

      o     Pursuant to restricted stock agreements, we issued 470,000 shares of
            common stock to six accredited investors, for services rendered.

      No broker was involved in connection with any of the foregoing
transactions.

      The foregoing issuances were exempt from registration pursuant to Section
4(2) of the Securities Act and Regulation D of the SEC thereunder.

      The conversion rights of the holders of the series A preferred stock are
described in "Item 2.01. Completion of Acquisition or Disposition of Assets"
under "Item 8. Description of Securities."

      The rights of the holders of the warrants are described "Item 1.01. Entry
into a Material Definitive Agreement."

                                      -32-
Item 5.01 Changes of Control of Registrant.

      The reverse merger with Ranor resulted in a change of control. For
information concerning our current officers and directors, see "Item 5.
Directors and Executive Officers, Promoters and Control Persons" under "Item
2.01. Completion of Acquisition or Disposition of Assets." For information on
stock holdings by our officers, directors and principal stockholders, see "Item
4. Security Ownership of Certain Beneficial Owners and Management" under "Item
2.01. Completion of Acquisition or Disposition of Assets."

      The current directors and officers were elected in connection with the
reverse acquisition.

Item 5.02. Departure of Directors or Principal Officers; Election of Directors;
Appointment of Principal Officers.

      If February 2006, we elected our present directors and officers.
Information concerning our officers and directors is disclosed in "Item 5.
Directors and Executive Officers, Promoters and Control Persons" under "Item
2.01. Completion of Acquisition or Disposition of Assets."

Item 5.03. Amendment to Certificate of Incorporation or Bylaws; Change in Fiscal
Year.

      On February 24, 2006, we filed a certificate of designation setting forth
the rights, preferences, privileges and limitations of the holders of our series
A preferred stock. See the caption "Series A Preferred Stock" in "Item 8.
Description of Securities" under "Item 2.01. Completion of Acquisition or
Disposition of Assets" for information concerning the rights of the holders of
the series A preferred stock.

      On February 24, 2006, our board of directors has approved, subject to
stockholder approval, an amendment to our certificate of incorporation to
include the following provision:

      "The terms and conditions of any rights, options and warrants approved by
the Board of Directors may provide that any or all of such terms and conditions
may be waived or amended only with the consent of the holders of a designated
percentage of a designated class or classes of capital stock of the Corporation
(or a designated group or groups of holders within such class or classes,
including but not limited to disinterested holders), and the applicable terms
and conditions of any such rights, options or warrants so conditioned may not be
waived or amended absent such consent."

      On March 2, 2006, we changed our fiscal year to the fiscal year ended
March 31. The change in fiscal year will be reflected in our Form 10-KSB for the
fiscal year ended March 31, 2006. The change of fiscal year results from our
acquisition of Ranor in February 2006 in a transaction accounted for as a
reverse acquisition. As a result, Ranor is the accounting acquiring entity, and
our historical financial statements will reflect the operations of Ranor, as if
Ranor had made the acquisition. We will also file a Form 10-KSB for the year
ended December 31, 2005 which will include the audited financial statements for
our business as it existed at December 31, 2005. The audited financial
statements for Ranor for the fiscal years ended March 31, 2005 and 2004 and the
unaudited financial statements for Ranor for the nine months ended December 31,
2005 and 2004 are included in this Form 8-K.

Section 5.06 Change in Shell Company Status.

      As a result of the reverse merger with Ranor, we are no longer a shell
company.

      See "Item 1.01 Entry into a Material Definitive Agreement" for information
relating to the agreements pursuant to which the reverse merger was consummated
and financed and "Item 2.01 Completion of Acquisition or Disposition of Assets"
for a description of our business following the completion of the reverse
merger.

Item 9.01 Financial Statements and Exhibits.

      (a)   Financial statements of Ranor. See Page F-1.

      (b)   Pro forma financial information. See Exhibit 99..

                                      -33-
(c)   See (a) and (b) of this Item 9.01.

      (d)   Exhibits

      2.1   Stock purchase agreement
      3.1   Certificate of Designation for the Series A Convertible Preferred
            Stock
      4.1   Loan and security agreement dated February 24, 2006, between Ranor
            and Sovereign Bank
      4.2   Guaranty from the Registrant to Sovereign Bank
      4.3   Form of warrant issued to Barron Partners LP
     99.1   Preferred stock purchase agreement dated February 24, 2006, between
            the Registrant and Barron Partners, LP
     99.2   Registration rights agreement dated February 24, 2006, between the
            Registrant and Barron Partners LP
     99.3   Agreement dated February 24, 2006, among the Registrant, Ranor
            Acquisition LLC and the members of Ranor Acquisition LLC.
     99.4   Subscription Agreement dated February 24, 2006
     99.5   Registration rights provisions pursuant to the agreements listed in
            Exhibits 99.3 and 99.4
     99.6   Employment agreement between the Registrant and Stanley Youtt
     99.7   Management agreement dated February 24, 2006, between Ranor and
            Techprecision LLC
     99.8   Lease, dated February 24, 2006 between WM Realty Management, LLC and
            Ranor
     99.9   2006 Long-term incentive plan
    99.10   Pro forma financial information*

*     To be filed by amendment.

                                      -34-
SIGNATURES

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

                                        LOUNBERRY HOLDINGS II, INC.
                                                (Registrant)

Date: March 2, 2006                     /s/ James G. Reindl
                                        ----------------------------------------
                                        James G. Reindl, Chairman
RANOR, INC.

                             MARCH 31, 2005 AND 2004
                                    (AUDITED)
                                       AND
                            FOR THE NINE MONTHS ENDED
                           DECEMBER 31, 2005 AND 2004
                                   (UNAUDITED)

                          INDEX TO FINANCIAL STATEMENTS

                                                                          PAGES

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                         F-2

FINANCIAL STATEMENTS

     BALANCE SHEETS                                                        F-3

     STATEMENTS OF OPERATIONS                                              F-4

     STATEMENTS OF STOCKHOLDERS' DEFICIT                                   F-5

     STATEMENTS OF CASH FLOWS                                              F-6

NOTES TO FINANCIAL STATEMENTS                                       F-7 - F-15

                                      F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
and Stockholders of
Ranor, Inc.

We have audited the accompanying balance sheets of Ranor, Inc. as of March 31,
2005 and 2004, and the related statements of operations, stockholders' equity,
and cash flows for the years then ended. 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 standards of the Public Company
Accounting Oversight Board (United States). These standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining on a
test basis evidence supporting the amounts and disclosures in the financial
statements. We conducted our audit 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
has determined that it 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 also includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion. 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 Ranor, Inc. as of March 31,
2005 and 2004, and the results of its operations and its cash flows for the
years then ended in conformity with accounting principles generally accepted in
the United States of America.

Bloom & Co., LLP
Hempstead, NY
February 14, 2006

                                      F-2
RANOR, INC.
                                 BALANCE SHEETS
ASSETS

                                                                         DECEMBER 31,             MARCH 31,
                                                                             2005           2005              2004
                                                                             ----           ----              ----
                                                                         (UNAUDITED)      (AUDITED)         (AUDITED)
CURRENT ASSETS
       Cash and cash equivalents                                          $  777,950     $ 1,226,030      $ 2,198,205
       Accounts receivable, less allowance for doubtful
          accounts of $25,000 on December 31,  2005
          and March 31, 2005 and 2004                                      3,216,172       1,810,664        2,044,367
       Other receivables                                                      23,903          29,561           51,847
       Costs incurred on uncompleted contracts,
          net of progress billings                                         2,192,434       1,991,643        1,110,666
       Inventories- raw materials                                            121,694          86,703           66,657
       Prepaid expenses                                                      142,449         116,910          106,067
                                                                           ---------       ---------        ---------

                          Total current assets                             6,474,602       5,261,511        5,577,809
                                                                           ---------       ---------        ---------

Property, Plant And Equipment, net                                         2,639,979       2,870,347        3,212,165
                                                                           ---------       ---------        ---------

Total Assets                                                            $  9,114,581    $  8,131,858     $  8,789,974
                                                                          ==========      ==========       ==========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
      Accounts payable                                                   $ 1,675,575      $  928,170       $  756,657
      Accrued expenses                                                     1,477,471         890,163          570,300
      Current maturity of long-term debt                                       5,506           5,506            5,243
                                                                           ---------        --------        ---------

                    Total current liabilities                              3,158,552       1,823,839        1,332,200
                                                                           ---------       ---------        ---------

LONG-TERM DEBT, LESS CURRENT MATURITY                                     10,015,302      10,019,422       10,025,377
                                                                          ----------      ----------       ----------

STOCKHOLDERS' DEFICIT
      Common stock - authorized 1,998,000 shares of
          $0.001 par value;  350,000 shares issued and outstanding               350             350              350
       Accumulated deficit                                             (  4,059,623)   (  3,711,753)    (  2,567,953)
                                                                       -------------   -------------    -------------

       Total Stockholders' Deficit                                     (  4,059,273)   (  3,711,403)    (  2,567,603)
                                                                       -------------   -------------    -------------

                                                                      $    9,114,581  $    8,131,858    $   8,789,974
                                                                       =============   =============     ============
The accompanying notes are an integral part of the financial statements.

                                      F-3
RANOR, INC.
                            STATEMENTS OF OPERATIONS
NINE MONTHS ENDED                       YEARS ENDED
                                                              DECEMBER 31,                           MARCH 31,

                                                            2005             2004               2005            2004
                                                            ----             ----               ----            ----
                                                        (UNAUDITED)       (UNAUDITED)         (AUDITED)       (AUDITED)
Net Sales                                               $ 13,713,739      $ 10,538,268       $ 14,269,982   $ 10,932,917

Cost Of Sales                                             11,494,666         9,642,262         12,631,640     10,148,270
                                                         -----------       -----------        -----------    -----------

Gross Profit                                               2,219,074           896,006          1,638,342        784,647

Operating Expenses                                         1,731,702         1,220,311          1,664,848      1,691,748
                                                         -----------       -----------        -----------    -----------

Income/(loss) From Operations                                487,372       (  324,305)        (   26,506)    (  907,101)
                                                         -----------       -----------        -----------    -----------

Other (Income) Expenses
      Interest expense                                       840,849           841,065          1,121,487      1,121,203
      Other income                                       (    8,707)       (    5,375)        (    8,285)    (   37,198)
                                                         -----------       -----------        -----------    -----------
                                                             832,142       (  835,691)          1,113,202      1,084,005
                                                         -----------       -----------        -----------    -----------

Income/(loss) Before Income Taxes And                    (  344,770)       (1,159,996)        (1,139,708)    (1,991,106)
                                                         -----------       -----------        -----------    -----------
Cumulative Effect    of a change in
accounting principle

Provision For Income Taxes                                     3,100             3,682              4,092          8,056
                                                         -----------       -----------        -----------    -----------

Income/(loss) Before Cumulative Effect Of
Change In
   Accounting Principle                                  (  347,870)       (1,163,678)        (1,143,800)    (1,999,162)
                                                         -----------       -----------        -----------    -----------

Cumulative Effect Of Change In Accounting
  Principle, Net Of Income Taxes Of $0                            --                --                 --    (   56,142)
                                                         -----------       -----------        -----------    -----------

Net Income/(loss)                                      $(   347,870)      $(1,163,678)       $(1,143,800)   $(2,055,304)
                                                        ============       ===========        ===========    ===========

Number of shares outstanding                               1,998,000         1,998,000          1,998,000      1,998,000
                                                         -----------       -----------        -----------    -----------

Net loss per share before cumulative effect                    $ .17             $ .58              $ .57          $1.00
                                                         -----------       -----------        -----------    -----------
of change in accounting principle

Net loss per share after cumulative effect                       N/A               N/A                N/A          $1.03
                                                         -----------       -----------        -----------    -----------
of change in accounting principle
The accompanying notes are an integral part of the financial statements.

                                      F-4
RANOR, INC.
                       STATEMENTS OF STOCKHOLDERS' DEFICIT
                       YEARS ENDED MARCH 31, 2005 AND 2004
                 AND FOR THE NINE MONTHS ENDED DECEMBER 31, 2005
Preferred Stock (a)            Common Stock              Accumulated
                                Warrants        -------------------            ------------              -----------
                               Outstanding      Shares      Amount         Shares         Amount     Deficit         Total
                               -----------      ------      ------         ------         ------     -------         -----
AUDITED:
--------
Balance, April 1, 2003           650,000         2,000    $2,000,000       350,000          $350     $(512,649)    $1,487,701

  Net loss for the year                             --            --            --            --    (2,055,304)    (2,055,304)
                                             ---------    ----------     ---------     ---------    -----------    -----------

Balance, March 31, 2004          650,000         2,000     2,000,000       350,000           350    (2,567,953)      (567,603)
                               ---------     ---------    ----------     ---------     ---------    -----------    -----------

   Net loss for the year                            --            --            --            --    (1,143,800)    (1,143,800)
                                             ---------    ----------     ---------     ---------    -----------    -----------

Balance, March 31, 2005          650,000         2,000    $2,000,000       350,000          $350   $(3,711,753)   $(1,711,403)
                               ---------     ---------    ----------     ---------     ---------    -----------    -----------

UNAUDITED:
   Net loss for the period                          --            --            --            --      (347,870)      (347,870)
                                             ---------    ----------     ---------     ---------    -----------    -----------

Balance, December 31, 2005       650,000         2,000    $2,000,000       350,000          $350   $(4,059,623)   $(2,059,273)
                               =========     =========    ==========     =========     =========    ===========    ===========
(a) Due to the preferred stock agreement which has the features of a long term
liability, it is being shown as long term debt.

    The accompanying notes are an integral part of the financial statements.

                                      F-5
RANOR, INC.
                            STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED                YEARS ENDED
                                                                         DECEMBER 31,                    MARCH 31,

                                                                      2005           2004           2005            2004
                                                                   (UNAUDITED)    (UNAUDITED)     (AUDITED)      (AUDITED)
                                                                   -----------    -----------     ---------      ---------

DECREASE IN CASH AND CASH EQUIVALENTS
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period                                      $  (  347,870)  $(1,163,678)   $ (1,143,800)  $ (2,055,304)
                                                                    ------------ -------------    ------------   ------------
     Noncash items included in net loss:
          Depreciation and amortization                                  310,097       306,927         407,706        393,524
          Provision for bad debts                                             --            --              --         25,000
     Changes in assets and liabilities:
          Accounts receivable                                       ( 1,399,850)  ( 1,087,466)         255,989    (  536,329)
          Inventory                                                 (   609,610)  (   846,128)    (    20,046)    (   24,945)
          Costs and estimated earnings in excess of billings on
               Uncompleted contracts                                     373,828     1,059,088    (   880,977)        199,878
          Costs on uncompleted contracts, net of contract
          billings                                                            --            --              --    (  357,122)
          Prepaid expenses                                          (    25,539)      (18,205)    (    10,843)            659
          Accounts payable and accrued expenses                        1,334,979       344,299         491,376        505,722
                                                                    ------------ -------------    ------------   ------------
                                                                    (    16,095)  (   241,485)         243,205        206,387
                                                                    ------------ -------------    ------------   ------------
                 Net cash used in operating activities              (   363,965)  ( 1,405,163)    (   900,595)    (1,848,917)
                                                                    ------------ -------------    ------------   ------------

CASH FLOWS FROM INVESTING ACTIVITIES
     Purchases of property, plant and equipment                     (    79,731) (     65,888)    (    65,888)   (   143,338)
                                                                    ------------ -------------    ------------   ------------
                 Net cash used in investing activities              (    79,731) (     65,888)    (    65,888)   (   143,338)
                                                                    ------------ -------------    ------------   ------------

CASH FLOWS FROM FINANCING ACTIVITIES
     Proceeds from long-term borrowings                                       --            --              --         30,620
     Principal payments on long-term borrowings                     (     4,384) (      3,904)    (     5,692)             --
                                                                    ------------ -------------    ------------   ------------
                 Net cash provided by (used in) financing
                 activities                                         (     4,384) (      3,904)    (     5,692)         30,620
                                                                    ------------ -------------    ------------   ------------

                 Net decrease in cash and cash equivalents        $ (   448,080)  $(1,474,955)   $(   972,175)   $(1,961,635)
                                                                    ------------ -------------    ------------   ------------

CASH AND CASH EQUIVALENTS, beginning of period                         1,226,030     2,198,206       2,198,205      4,159,840
                                                                    ------------ -------------    ------------   ------------

CASH AND CASH EQUIVALENTS, end of period                            $    777,950  $    723,251    $  1,226,030    $ 2,198,205
                                                                    ============ =============    ============   ============

Supplemental Disclosures of Cash Flows Information
--------------------------------------------------
           Cash paid during the year for:
                  Interest expense                                  $         --   $   841,065     $   934,821    $ 1,121,203
                                                                    ============ =============    ============   ============
                  Income taxes                                      $      3,100   $      ,100     $     1,181    $     8,056
                                                                    ============ =============    ============   ============
The accompanying notes are an integral part of the financial statements.

                                      F-6
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES

USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS

In preparing financial statements in conformity with generally accepted
accounting principles, management is required to make estimates and assumptions
that affect the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
revenues and expenses during the reported period. Actual results could differ
from those estimates.

FAIR VALUES OF FINANCIAL INSTRUMENTS

Cash and cash equivalents. Holdings of highly liquid investments with maturities
of three months or less, when purchased, are considered to be cash equivalents.
The carrying amount reported in the balance sheet for cash and cash equivalents
approximates its fair values. The amount of federally insured cash deposits was
$100,000 as of March 31, 2005 and March 31, 2004.

Since the redeemable preferred stock does not pay any dividends and the
redemption value is due in 2012, the discounted fair value of the redeemable
preferred stock, at company's cost of capital, is less than the face amount of
$2,000,000.

The carrying amount of trade accounts receivable, accounts payable, prepaid and
accrued expenses, and notes payable, as presented in the balance sheet,
approximates fair value.

ACCOUNTS RECEIVABLE

Trade accounts receivable are stated at the amount Ranor expects to collect.
Ranor maintains allowances for doubtful accounts for estimated losses resulting
from the inability of its customers to make required payments. Management
considers the following factors when determining the collectability of specific
customer accounts: customer credit-worthiness, past transaction history with the
customer, current economic industry trends, and changes in customer payment
terms. If the financial condition of Ranor's customers were to deteriorate,
adversely affecting their ability to make payments, additional allowances would
be required. Based on management's assessment, Ranor provides for estimated
uncollectible amounts through a charge to earnings and a credit to a valuation
allowance. Balances that remain outstanding after Ranor has used reasonable
collection efforts are written off through a charge to the valuation allowance
and a credit to accounts receivable. Current earnings are also charged with an
allowance for sales returns based on historical experience.

INVENTORIES

Inventories consist of raw materials and are stated at the lower of cost or
market. Cost is determined principally by the first-in, first-out method.

NOTES PAYABLE

We account for all note liabilities that are due and payable in one year as
short-term notes.

                                      F-7
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

LONG-LIVED ASSETS

Property, plant and equipment- these assets are recorded at cost less
depreciation and amortization. Depreciation and amortization are accounted for
on the straight-line method based on estimated useful lives. The amortization of
leasehold improvements is based on the shorter of the lease term or the life of
the improvement. Betterments and large renewals, which extend the life of the
asset, are capitalized whereas maintenance and repairs and small renewals are
expenses, as incurred. The estimated useful lives are: machinery and equipment,
7-15 years; buildings, 30 years; and leasehold improvements, 10-20 years.

REVENUE RECOGNITION

Revenues from contracts were recorded on the percentage-of-completion method.
Effective April 1, 2003, Ranor adopted the units-of-delivery method under the
percentage-of-completion method of revenue recognition. Accordingly, income is
recognized at the time at which a unit under contract is completed and delivered
to the customer. The costs related to the unit are recorded as costs of goods
sold in an amount that approximates a proportionate amount for each unit of the
total expected costs in completing the entire contract. As described in Note 3,
prior to 2004, Ranor followed the labor-to-labor method under the
percentage-of-completion method of accounting for such contracts.

Adjustments to cost estimates are made periodically, and losses expected to be
incurred on contracts in progress are charged to operations in the period such
losses are determined and are reflected as reductions of the carrying value of
the costs incurred on uncompleted contracts.

COSTS INCURRED ON UNCOMPLETED CONTRACTS

Costs incurred on uncompleted contracts consist of labor, overhead, and
materials costs incurred on uncompleted contracts. Costs are stated at the lower
of cost or market and reflect accrued losses, if required, on uncompleted
contracts.

ADVERTISING EXPENSES

Advertising costs are charged to operations when incurred. Advertising expenses
were $14,060 in 2005 and $30,686 in 2004.

INCOME TAXES

Temporary differences giving rise to deferred income taxes consist primarily of
the reporting of contract revenues and expenses and losses on uncompleted
contracts, the excess of depreciation for tax purposes over the amount for
financial reporting purposes, inventory valuation, accrued expenses accounted
for differently for financial reporting and tax purposes, and net operating loss
carryforwards.

                                      F-8
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

NEW ACCOUNTING PRONOUNCEMENTS

In December 2004, the FASB issued SFAS No.123 (revised 2004), "Share-Based
Payment" ("SFAS 123R"), which replaces SFAS No. 123, "Accounting for Stock-Based
Compensation" ("SFAS 123") and supercedes APB Opinion No. 25, "Accounting for
Stock Issued to Employees. "SFAS 123R requires that all share-based payments to
employees, including grants of employee stock options, be recognized in the
financial statements based on their fair values, beginning with the first
interim or annual period after June 15, 2005, with early adoption encouraged.
The pro forma disclosures previously permitted under SFAS 123, no longer will be
an alternative to financial statement recognition. We are required to adopt SFAS
123R in the third quarter of 2005. Under SFAS 123R, we must determine the
appropriate fair value model to be used in valuing share-based payments, the
amortization method for compensation cost and the transition method to be used
at the date of adoption. Upon adoption, we may choose from two transition
methods: the modified-prospective transition approach or the
modified-retroactive transition approach. Under the modified-prospective
transition approach we would be required to recognize compensation cost for
awards that were granted prior to, but not vested as of the date of adoption.
Prior periods remain unchanged and pro forma disclosures previously required by
SFAS No. 123 continue to be required. Under the modified-retrospective
transition method, we would be required to restate prior periods by recognizing
compensation cost in the amounts previously reported in the pro forma disclosure
under SFAS No. 123. Under this method, we would be permitted to apply this
presentation to all periods presented or to the start of the fiscal year in
which SFAS No. 123R is adopted. We would also be required to follow the same
guidelines as in the modified-prospective transition method for awards granted
subsequent to adoption and those that were granted and not yet vested.

NEW ACCOUNTING PRONOUNCEMENTS

We are currently evaluating the requirements of SFAS 123R and its impact on our
consolidated results of operations and earnings per share. We have not yet
determined the method of adoption or the effect of adopting SFAS 123R, and it
has not been determined whether the adoption will result in amounts similar to
the current pro forma disclosures under SFAS 123.

In December 2004, the FASB issued Staff Position ("FSP") No.109-2, "Accounting
and Disclosure Guidance for the Foreign Earnings Repatriation Provision within
the American Jobs Creation Act of 2004" ("FSP 109-2"). This position provides
guidance under FASB Statement No.109 ("SFAS 109"), "Accounting for Income
Taxes", with respect to recording the potential impact of the repatriation
provisions of the American Jobs Creation Act of 2004 (the "Jobs Act") on
enterprises' income tax expense and deferred tax liability. The Jobs Act was
enacted on October 22, 2004. FSP 109-2 states that an enterprise is allowed time
beyond the financial reporting period of enactment to evaluate the effect of the
Jobs Act on its plan for reinvestment or repatriation of foreign earnings for
purposes of applying SFAS 109.

In December 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary Assets
- An Amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions"
("SFAS 153"). SFAS 153 eliminates the exception from fair value measurement for
nonmonetary exchanges of similar productive assets in paragraph 21(b) of APB
Opinion No. 29, "Accounting for Nonmonetary Transactions," and replaces it with
an exception for exchanges that do not have commercial substance. SFAS 153
specifies that a nonmonetary exchange has commercial substance if the future
cash flows of the entity are expected to change significantly as a result of the
exchange. SFAS 153 is effective for fiscal periods beginning after June 15,
2005. We have considered SFAS 153 and have determined that this pronouncement is
not applicable to our current operations.

                                      F-9
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 1. SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

NEW ACCOUNTING PRONOUNCEMENTS, CONTINUED

In November 2004, the FASB issued SFAS No. 151, "Inventory Costs - An Amendment
of ARB Opinion No. 43, Chapter 4" ("SFAS 151"). SFAS 151 amends the guidance in
ARB No. 43, Chapter 4, "Inventory Pricing," to clarify the accounting for
abnormal amounts of idle facility expense, freight, handling costs, and wasted
material (spoilage). Among other provisions, the new rule requires that items
such as idle facility expense, excessive spoilage, double freight, and
rehandling costs be recognized as current period charges regardless of whether
they meet the criterion of "so abnormal" as stated in ARB No. 43. Additionally,
SFAS 151 requires that the allocation of fixed production overheads to the costs
of conversion be based on the normal capacity of the production facilities. SFAS
151 is effective for fiscal years beginning after June 15, 2005. We have
considered SFAS 151 and have determined that this pronouncement will not
materially impact our consolidated results of operations.

In November 2004, the FASB issued SFAS No. 152, "Accounting for Real Estate
Time-Sharing Transactions - An amendment of SFAS No. 66 and 67". This statement
amends SFAS No. 66, "Accounting for Sales of Real Estate, to reference the
financial accounting and reporting guidance for real estate time-sharing
transactions which is provided in AICPA Statement of Position ("SOP") 04-2,
"Accounting for Real Estate Time-Sharing Transactions." This statement also
amends SFAS No. 67, "Accounting for Costs and Initial Rental Operations of Real
Estate Projects," to state the guidance for (a) incidental costs and (b) costs
incurred to sell real estate projects does not apply to real estate time-sharing
transactions. The accounting for those costs is subject to guidance in SOP 04-2.
SFAS 152 is effective for fiscal years beginning after June 15, 2005. We have
considered SFAS 152 and have determined that this pronouncement is not
applicable to our current operations.

In December 2003, the FASB issued a revision to Statement No. 132, Employers'
Disclosures about Pensions and Other Postretirement Benefits. This revision
requires additional disclosures by Ranor regarding its plan assets, investment
strategies, plan obligations and cash flows. We have considered revised
statement 132 and have determined that at this time this pronouncement is not
applicable to our current operations.

NOTE 2. DESCRIPTION OF BUSINESS

Ranor, Inc., ("Ranor") is a leading provider of high precision metal fabrication
and machining services for large metal components weighing up to 100 tons. Ranor
fabricates nuclear grade steel casks, canisters and housings for the
transportation and storage of radioactive materials; produces large fabrications
for Navy aircraft carriers, submarines and commercial vessels; and manufactures
pulp and paper machinery, gas turbine power generation equipment, oil refinery
and utilities equipment. Ranor is one of two companies currently capable of
machining one-piece aluminum domes for Boeing's Delta III and Delta IV rocket
programs.

                                      F-10
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 3. PROPERTY, PLANT AND EQUIPMENT

As of March 31, 2005 and 2004 property, plant and equipment consisted of the
following:

                                                      2005               2004
                                                      ----               ----
       Land                                         $ 110,113          $ 110,113
       Building and improvements                    1,223,054          1,223,054
       Furniture and fixtures                          43,737             38,471
       Machinery and equipment                      2,549,045          2,488,422
                                                  -----------         ----------
                                                    3,925,949          3,860,060
                                                  -----------         ----------

       Less: accumulated depreciation               1,055,602            647,895
                                                  -----------         ----------
                                                  $ 2,870,347         $3,212,165
                                                  -----------         ----------

Depreciation expense for the years ended March 31, 2005 and 2004 were $407,707
and $393,524, respectively.

NOTE 4. CHANGE IN ACCOUNTING PRINCIPLE/CONTRACTS IN PROCESS

During 2004, Ranor changed its method of recognizing revenues for contracts that
have an estimated contract value of $500,000 and contract life of at least nine
months. Whereas prior to 2004, Ranor followed the labor-to-labor method for
determining the percentage-of-completion method of accounting for such contracts
in which income is recognized in the ratio that labor costs incurred bears to
estimated total labor costs, it is now recognizing the percentage-of-completion
based upon the units-of-delivery method (see Note 1). The cumulative effect of
the change of $56,142 is shown as a one-time charge to operations in the 2004
statement of operations.

  Contracts in process consisted of the following at March 31:

                                                       2005             2004
                                                  ------------     -------------
    Costs incurred on uncompleted contracts        $5,561,541      $   5,610,949
    Estimated losses accrued to date                 (892,376)       (1,064,104)
                                                  ------------     -------------
                                                    4,669,165         4,546,845
    Less: billings to date                          2,677,522         3,436,179
                                                  ------------     -------------

                                                   $1,991,643      $  1,110,666
                                                  ============     =============

These amounts are included in the accompanying balance sheets under the caption
"Costs and estimated earnings in excess of billings on uncompleted contracts" at
March 31, 2005 and 2004.

                                      F-11
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS
NOTE 5. LONG-TERM DEBT

     Long-term debt consists of the following at March 31:
                                                                                            2005              2004
                                                                                        -----------       -----------
Preferred Stock - authorized 2,000 shares of $.001 par value:
           2,000 shares issued and outstanding and redeemable on August 7,
           2012.
        (See Note 10)                                                                     $2,000,000       $2,000,000

        Green Mountain Partners III, L.P. -
          Unsecured note payable in semi-annual interest installments at
          14.0%, due in February and August. Principal payments of
          $800,000 due annually commencing on August 7, 2006 through
          August 2011, and $1,600,000 on August 7, 2012. Prepayments of
          principal are allowable or required under certain conditions, as
          defined. The note is subject to covenants, which provide, among
          other things, restrictions on the incurrence of additional debt
          or commitments.                                                                  6,400,000        6,400,000

        Phoenix Life Insurance Company -
          Unsecured note payable in semi-annual interest installments at
          14.0%, due in February and August. Principal payments of
          $200,000 due annually commencing on August 7, 2006 through
          August 2011, and $400,000 on August 7, 2012. Prepayments of
          principal are allowable or required under certain conditions, as
          defined. The note is subject to covenants, which provide, among
          other things, restrictions on the incurrence of additional debt
          or commitments.                                                                  1,600,000        1,600,000

        Ford Motor Credit Company-
          Payable in monthly installments of $552 including interest of
          4.90% commencing July 20, 2003 through June 20, 2009.
          Secured by a vehicle.                                                               24,928           30,620
                                                                                      --------------   --------------
                                                                                          10,024,928       10,030,620
        Principal payments due within one year                                                 5,506            5,243
                                                                                     ---------------  ---------------

                                                                                         $10,019,422      $10,025,377
                                                                                     ===============  ===============
As of March 31, 2005, long-term debt matures as follows:

              Years ending
                March 31,                                      Amount
                ---------                                    ---------
                  2006                                     $       5,506
                  2007                                         1,005,782
                  2008                                         1,006,071
                  2009                                         1,006,375
                  2010                                         1,001,194
               Thereafter                                      6,000,000
                                                               ---------
                                                             $10,024,928
                                                             ===========

                                      F-12
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 6. INCOME TAXES
The provision for income taxes consists of the following at March 31:                 2005           2004
                                                                                      ----           ----
Current                                                                                 $ 4,092       $ 8,056
Deferred                                                                                     --            --
                                                                                    -----------    ----------
                                                                                      $   4,092      $  8,056
                                                                                    ===========    ==========

Deferred tax assets and liabilities consist of the following at March 31:
    Deferred tax asset:
        Allowance for doubtful accounts                                                $  9,800       $ 9,800
        Inventory valuation                                                              26,900        10,700
        Revenue recognition on uncompleted contracts                                    113,900       457,800
        Net operating loss carryforward                                               1,353,200       564,700
        Accrued expenses                                                                127,600       106,000
                                                                                    -----------    ----------
                                                                                      1,631,400     1,149,000
        Less: Valuation Allowance                                                   (1,440,000)   (  995,700)
                                                                                    ===========    ==========
                                                                                   $    191,400   $   153,300
                                                                                    ===========    ==========

     Deferred tax liabilities:
          Depreciation of property and equipment                                   $    191,400   $   153,300
                                                                                    ===========    ==========
The valuation allowance increased by $444,300 in 2005 and $798,100 in 2004.

At March 31, 2005, Ranor has approximately $3,470,000 of net operating losses
available to reduce future taxable income through 2025 for federal purposes and
2010 for state purposes. Under Internal Revenue Code Section 382, whenever a
stock ownership change of more than 50% occurs, within generally a three-year
period (testing period), the corporation's ability to use pre-change loss carry
forward is substantially limited.

Ranor's effective income tax rate is 39%, which is higher than what would be
expected if the federal statutory rate was applied to losses primarily because
of the valuation allowance applied to the net operating loss carryforward.

NOTE 7. RELATED PARTY TRANSACTIONS

Ranor has agreements to pay management fees totaling $200,000 per year to four
stockholders under agreements that expire August 2005 and are renewable annually
thereafter. Effective June 2003, two of these stockholders have accepted a
salary from Ranor in lieu of the management fee, but have retained their rights
under their agreements. Total management fees charged to operations under this
agreement were $49,000 in 2005 and $75,000 in 2004. As of March 31, 2005 and
2004, Ranor has included in accounts payable unpaid management fees of $132,291
and $83,333, respectively. The total future commitments under these agreements
were $8,333 as of March 31, 2005.

Ranor has long-term debt payable to Green Mountain Partners III, L.P. and
Phoenix Life Insurance Company (see Note 4), which holds the outstanding
preferred stock and common stock warrants (see Note 9). Interest expense charged
to operations under the related party debt was $1,120,000 in 2005 and 2004.

                                      F-13
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 8. OPERATING LEASE

Ranor leases office equipment under operating lease agreements expiring through
November 2008. Total rent expense charged to operations approximated $16,700 in
2005 and $19,900 in 2004.

Future minimum lease payments under noncancellable portions of the leases as of
March 31, 2005, are as follows:

              Years ending
               March 31,                                        Amount
               ---------                                        ------
                 2006                                          $  16,678
                 2007                                             16,678
                 2008                                             15,288
                                                               ---------
         Total minimum lease payments                          $  48,644
                                                               =========

NOTE 9. PROFIT SHARING PLAN

Ranor has a 401(k) profit sharing plan that covers substantially all employees
who have completed 90 days of service. Ranor retains the option to match
employee contributions. There were no employer-matched contributions charged to
operations in 2005 and 2004.

NOTE 10. CAPITAL STOCK

PREFERRED STOCK

The 2,000 shares of preferred stock outstanding are classified as Series A and
carry a mandatory redemption provision under which Ranor is required to redeem
all the outstanding shares on August 7, 2012 at $1,000 per share. Ranor has the
option to redeem any or all the shares prior to that date. The preferred stock
carries no voting or dividend rights. The preferred stock carries a preference
of $1,000 per share in the event of liquidation.

The stockholder agreements contain a provision whereby, effective August 2009,
any preferred stockholder can, upon written notice, require Ranor to repurchase
their shares at a price as defined in the agreement.

STOCK WARRANTS

At March 31, 2005 and 2004, the preferred stockholders and debt holders (see
Note 6) had warrants to acquire 650,000 shares of common stock at a price of
$.001 per share. The warrants are immediately exercisable and expire on August
7, 2012. The warrants carry repurchase provisions as defined. Six hundred fifty
thousand shares of common stock have been reserved for the issuance of these
warrants.

The stockholder agreements contain a provision whereby, effective August 2009,
any holders of stock warrants can, upon written notice, require Ranor to
repurchase the warrants or any shares issued under the warrant agreement at a
price as defined in the agreement. At March 31, 2005 and 2004, the warrants had
no determinable value.

COMMON STOCK

The sale or transfer of the common stock of Ranor is subject to the terms of the
stockholder agreement among Ranor and its stockholders and warrant holders.

                                      F-14
RANOR, INC.
                          NOTES TO FINANCIAL STATEMENTS

NOTE 11. CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS

Ranor maintains bank account balances, which, at times, may exceed insured
limits. Ranor has not experienced any losses with these accounts. Management
believes Ranor is not exposed to any significant credit risk on cash.

In 2005, Ranor sold a substantial portion of its products to two customers.
Sales for the period ended March 31, 2005, to these customers were approximately
$2,680,000 (19%), and $1,572,000 (11%). At March 31, 2005, amounts due from
these customers, included in trade accounts receivable, were $519,667 and
$38,777, respectively.

In 2004, Ranor sold a substantial portion of its products to two customers.
Sales for the period ended March 31, 2004 to these customers were approximately
$2,311,000 (19%), and $1,818,000 (15%). At March 31, 2004, amounts due from
these customers, included in trade accounts receivable, were $286,696 and
$248,604, respectively.

NOTE 12. ADOPTION OF ACCOUNTING PRINCIPLE

The FASB has issued Statement No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity. Statement No.
150 requires that certain freestanding financial instruments be reported as
liabilities in the balance sheet. Depending on the type of financial instrument,
it will be accounted for at either fair value or the present value of future
cash flows determined at each balance sheet date with the change in that value
reported as interest expense in the income statement. Prior to the application
of Statement No. 150, either those financial instruments were not required to be
recognized, or if recognized were reported in the balance sheet as equity and
changes in the value of those instruments were normally not recognized in net
earnings.

As explained in Note 9, Ranor has mandatory redeemable preferred stock that is
reported as a liability under Statement No. 150. The carrying value of that
stock was transferred from stockholders' deficiency to liabilities, which had
the effect of increasing stockholders' deficiency and increasing liabilities.

NOTE 13. SUBSEQUENT EVENT

On August 17, 2005 an agreement was signed whereby the present shareholders,
note holders and preferred stock holders agreed to sell their shares, redeem
their notes and retire their preferred stock. The purchaser of these shares is
Ranor Acquisition LLC, a Delaware Limited Liability Company. The purchase price
of the Common Securities is $9,250,000 minus the aggregate amount of the Company
Debt outstanding on the closing date, minus: (1) the adjusted redemption value
of the preferred shares; (2) the sellers' expenses; (3) the net cash amount on
the closing date as determined in accordance with the agreement (or plus, if the
net cash amount is a negative number); (4) and any accounts payable adjustment
amount (such aggregate value being referred to herein as the "closing date
purchase price"). The closing date purchase price shall be subject to further
adjustment after the closing pursuant to a review by the sellers' accountants.

The incoming shareholders will pay off the $8 million notes payable, redeem the
$2 million preferred stock, pay the outstanding balance of the accounts payable,
and recompense the purchase price of common shares of Ranor from the following
funds:

1. Sale-leaseback of Ranor's land and building for $3 million.
2. Bank term Loan of $4 million and $1 million bank line of credit.
3. Capital contribution of $2.5 million.
4. Ranor's cash account.

                                      F-15