ThZeal - The Zeal

DEF 14A 1 d68293_def14a.txt DEFINITIVE PROXY STATEMENT SCHEDULE 14A (Rule 14a-101) INFORMATION REQUIRED IN PROXY STATEMENT SCHEDULE 14A INFORMATION Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. ) Filed by the Registrant |X| Filed by a Party other than the Registrant |_| Check the appropriate box: |_| Preliminary Proxy Statement |_| Soliciting Material Under Rule |_| Confidential, For Use of the 14a-12 Commission Only (as permitted by Rule 14a-6(e)(2)) |X| Definitive Proxy Statement |_| Definitive Additional Materials TRIDAN CORP. -------------------------------------------------------------------------------- (Name of Registrant as Specified In Its Charter) -------------------------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant) Payment of Filing Fee (Check the appropriate box): |X| No fee required. |_| Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. 1) Title of each class of securities to which transaction applies: ________________________________________________________________________________ 2) Aggregate number of securities to which transaction applies: ________________________________________________________________________________ 3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): ________________________________________________________________________________ 4) Proposed maximum aggregate value of transaction: ________________________________________________________________________________ 5) Total fee paid: ________________________________________________________________________________ |_| Fee paid previously with preliminary materials: ________________________________________________________________________________ |_| Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. 1) Amount previously paid: ________________________________________________________________________________ 2) Form, Schedule or Registration Statement No.: ________________________________________________________________________________ 3) Filing Party: ________________________________________________________________________________ 4) Date Filed: ________________________________________________________________________________ TRIDAN CORP. 261 West 35th Street, 16th Floor New York, NY 10001 NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 20, 2006 To the Shareholders of Tridan Corp.: The Annual Meeting of Shareholders of Tridan Corp. (the "Company") will be held on Tuesday, June 20, 2006, at 10:00 A.M. at the offices of Kantor, Davidoff, Wolfe, Mandelker & Kass, P.C., 17th floor, 51 East 42nd Street, New York, NY 10017. The following subjects will be considered and acted upon at the meeting: (1) Election of six directors; (2) Ratification of the selection of Weiser LLP as auditors of the Company for the fiscal year ending April 30, 2007; (3) Transaction of such other business as may properly come before the meeting or any adjournment or adjournments thereof. The subjects referred to above are discussed in the Proxy Statement attached to this notice. Each shareholder is invited to attend the Annual Meeting of Shareholders in person. Shareholders of record at the close of business on May 19, 2006 have the right to vote at the meeting. If you cannot be present at the meeting, we urge you to fill in, sign and promptly return the enclosed proxy in order that your shares will be represented at the meeting. By Order of the Board of Directors I. Robert Harris, Secretary June 1, 2006 TRIDAN CORP. 261 West 35th Street, 16th Floor New York, NY 10001 PROXY STATEMENT This statement is furnished in connection with the solicitation by the Board of Directors of Tridan Corp., a New York corporation (the "Company") of proxies to be voted at the Annual Meeting of Shareholders to be held June 20, 2006 and any and all adjournments thereof, for the purposes set forth in the accompanying Notice of Annual Meeting of Shareholders. This Proxy Statement is being mailed to shareholders on or about June 1, 2006. All proxies which have been properly executed and received by the time of the meeting will be voted at the meeting in accordance with the instructions thereon. Any shareholder executing a proxy may revoke it in writing by execution of another proxy or by any other legal method at any time before the shares subject to the proxy are voted at the meeting. The Board of Directors recommends that shares be voted, and if no choice is specified on the proxy, the shares will be voted FOR the election as directors of the nominees hereinafter named, FOR ratification of the selection of Weiser LLP, as auditors, and in the discretion of the proxy holders on such other matters as may properly come before the meeting. As of May 19, 2006, there were issued and outstanding 3,115,211.4513 shares of capital stock, par value $.02 per share, of the Company, which is the only class of capital stock of the Company. Shareholders will be entitled to one vote for each share held, with pro rata voting rights for any fractional shares. Holders of record of such shares at the close of business on May 19, 2006 will be entitled to vote at the meeting. The participants in the Tridan Corp. Employees' Stock Ownership Trust are the beneficial shareholders of the shares held under the Trust, and the shares held for such participants will be voted only if and as directed by the participant for whose account such shares are held of record by the trustees of the Trust. Accordingly, the attached Notice, this Proxy Statement and the form of proxy have been mailed to each person who was a participant on the record date, and the shares beneficially owned by such participants will be voted in accordance with their proxies. The Company will pay the cost of preparing, assembling, and mailing the form of proxy and the material used in connection with solicitation of proxies. In addition to solicitation by use of the mails, certain officers and directors of the Company, who will receive no compensation for their services (other than their regular compensation) may solicit the return of proxies personally or by telephone or telegraph. An Annual Report covering the operations of the Company for its fiscal years ended April 30, 2006 and 2005 is enclosed herewith, but does not constitute a part of the material for the solicitation of proxies. ELECTION OF DIRECTORS At the meeting, six directors are to be elected to hold office until the next Annual Meeting of Shareholders and until their respective successors shall have been chosen and qualified, or as otherwise provided in the By-Laws of the Company. The election of a Board of Directors will require the vote of a majority of the shares present in person or by proxy at the meeting. It is intended that the persons named in the accompanying proxy will vote such proxy, if signed and returned, for the election of the nominees listed below. If for any reason any of said nominees shall become unavailable for election, which is not anticipated, the proxies may be voted for a substitute nominee designated by the Board of Directors. The Board of Directors has no reason to expect that any of the nominees will fail to be a candidate at the meeting and, accordingly, does not have in mind any substitute. As of May 19, 2006, Peter Goodman owned beneficially 1,277,381.35 shares (41%) of the Company, which does not include shares owned by Barbara S. Goodman, Peter Goodman's wife, nor shares owned by them as trustees for his brother Thomas Goodman. The following Tables A and B set forth information concerning directors and nominees for election as director for a term of one year. Table C sets forth information concerning non-director officers of the Company. The Table A nominees (Mark Goodman, Peter Goodman and Warren Pelton) are "interested persons" as defined in Section 2(a)19 of the Investment Company Act of 1940, and the Table B nominees (Messrs. Kramer, Negin and Stoever) are not. Peter Goodman is an "interested person" because he is an officer and holder of more than 5% of the shares of the Company, Mark Goodman because he is Peter Goodman's son, and Warren Pelton because he is an officer of the Company.

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The following table sets forth the dollar range of equity securities beneficially owned by each nominee for election as director: Dollar Range of Equity Securities Name of Nominee in Tridan Corp. --------------- -------------------------------------- Interested Persons: Mark Goodman Over $100,000 Peter Goodman Over $100,000 Warren Fred Pelton Over $100,000 Disinterested Persons: Paul Kramer None Jay Stanley Negin None Russell Jude Stoever None COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS No director or officer received any compensation from the Company during the last fiscal year, except for fees of $12,000 paid to each director, plus an additional $2,500 to Paul Kramer as chairman of the audit committee. All executive officers of the Company as a group (two persons) received compensation (comprised solely of said directors' fees) aggregating $24,000 during fiscal 2006 (which excludes professional fees paid to the law firm of which I. Robert Harris, secretary of the Company, is a member). - 4 - COMMITTEES Audit Committee The Audit Committee consists of three directors appointed by the board, namely Paul Kramer, Chairman, Jay S. Negin and Russell J. Stoever, each of whom is independent as defined in Rule 4200(a)(15) of the NASD listing standards. The board has determined that Mr. Kramer qualifies as an Audit Committee financial expert, as defined by applicable SEC rules and regulations. The Audit Committee operates under its charter, which it reviews annually and which is then submitted for approval by the Board of Directors. A copy of the charter is attached as an appendix to this proxy statement. The Audit Committee assists the Board of Directors in fulfilling their oversight responsibilities relating to the quality of the Company's accounting and auditing practices, including its financial statements and financial reporting process, disclosure controls and procedures and internal control over financial reporting, the annual independent audit of the Company's financial statements, and compliance with the Company's ethics program and with regulatory requirements. The Audit Committee is directly responsible for the appointment, compensation and oversight of the Company's independent registered public accounting firm. The committee met three times during the fiscal year ended April 30, 2006. Audit Committee Report The Audit Committee has reviewed and discussed the Company's April 30, 2006 audited financial statements with management and with Weiser LLP, the Company's independent registered certified public accountants. The Audit Committee has also discussed with said auditors the matters required to be discussed by Statement on Auditing Standards No. 61, as amended by statements on Auditing Standards Nos. 89 and 90, has received from them the written disclosures and letter required by Independence Standards Board Standard No. 1, and has discussed with them their independence from the Company. The Audit Committee met separately with the independent registered certified public accountants, with and without management, to discuss the results of their examination and their observations and recommendations. Based on the foregoing review and discussions, the Audit Committee has recommended to the Board that the audited financial statements as of April 30, 2006 be issued to shareholders and filed with the SEC. Audit Committee Members: Paul Kramer, Chairman Jay S. Negin Russell J. Stoever Nominating Committee The Company does not have a standing nominating committee, because of the small size of the Board of Directors and the infrequency of its turnover. Rather, on those rare occasions when a new candidate is proposed for consideration, whether by a shareholder or by others, the entire board considers the candidate and the board itself acts as a nominating - 5 - committee. The board considers a candidate's, experience, familiarity with business and investments, knowledge about issues affecting the Company, and willingness to spend the time necessary to read applicable materials and attend meetings. In instances where the board determines that a candidate will be a valuable replacement or addition to the Board of Directors, the board recommends such candidate's election by the shareholders. This procedure has been followed successfully and without issue since 1980, when the Company first became a registered investment company, and the board believes it continues to be appropriate. ATTENDANCE AT MEETINGS During the fiscal year ended April 30, 2006, there were six meetings of the Board of Directors and three meetings of the Audit Committee. Each of the directors attended at least 75% of the aggregate number of meetings of the Board and of the Audit Committee on which he served. Although the Company has no formal policy regarding director attendance at the annual shareholders meetings, directors are expected to attend, and all members of the Board attended last year's annual meeting. SHAREHOLDER COMMUNICATIONS WITH DIRECTORS The Board of Directors has not established a formal process for shareholders to send communications to the Board. In the Board's view, it is appropriate for the Company not to have such process, because the directors are few in number, and any shareholder who wishes to do so may address a letter to the attention of the entire Board, care of the Company at its principal office, or to individual Board members either at that address or at their personal addresses listed in the proxy statement. PRINCIPAL AND MANAGEMENT SHAREHOLDERS The following table sets forth certain information concerning directors and nominees as directors of the Company and persons believed by the Company to be the record owners of more than five percent (5%) of the Company's voting securities as of May 19, 2006:

- 6 - Robert W. Erdos 282,640.11 2/ 4/ 9.07% 549 Fairview Terrace York, PA 17403 Mark Goodman 77,333.33 2.48% 312 La Grange Street West Roxbury, MA 02132 Warren F. Pelton 29,930.89 0.96% 6079 Fairway Court Naples, FL 34110 All officers, 1,384,645.57 2/ 3/ 44.45% directors and nominees as a group (7 persons) 1/ Not including 600,000 shares owned indirectly by Mr. Goodman and his wife, Barbara S. Goodman, as co-trustees for his brother, Thomas Goodman (see footnote 3), with respect to which the co-trustees have shared voting and investment power. 2/ Including the following shares owned by Tridan Corp. Employees Stock Ownership Trust, as nominee only: 8,424.09 shares owned directly and beneficially by Peter Goodman, and 5,640.11 shares owned directly and beneficially by Robert W. Erdos. Messrs. Robert W. Erdos, Peter Goodman, Thomas Goodman and Warren F. Pelton are trustees of said Trust. 3/ Including 600,000 shares owned of record only, by Peter Goodman and Barbara S. Goodman, as trustees for Thomas Goodman (Peter Goodman's brother). 4/ This amount does not include 49,000 shares owned of record and beneficially by Erda Erdos, Mr. Erdos' wife. The foregoing table and footnotes shall not be construed as an admission that Peter Goodman is the beneficial owner of any shares owned by him as a trustee for his brother, nor of any shares owned by Mr. Goodman's wife; nor as an admission that Barbara S. Goodman is the beneficial owner of any shares owned by her as a trustee for Peter Goodman's brother; nor as an admission that Robert W. Erdos is the beneficial owner of any shares owned by Mr. Erdos' wife. Peter Goodman, president and a director of the Company, controls the Company in that any matter to be voted on at the meeting can be decided by Mr. Goodman and any one of several other shareholders, who together own a majority of the outstanding shares, if they vote in the same way on such matter. Joseph T. Scialo is the Company's Administrator. Mr. Scialo is a certified public accountant in the firm of Scialo & Company CPA, P.C., 261 West 35th Street, 16th Floor, New York, NY 10001. - 7 - RELATIONSHIP WITH AND RATIFICATION OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS The Audit Committee is responsible for approving the engagement of the Company's independent public accountants prior to their engagement. The Audit Committee and Board of Directors have unanimously approved the selection of Weiser LLP as independent public accountants for the Company for the fiscal year ending April 30, 2007. The former accounting firm of Leslie Sufrin and Company, P.C., which merged into Weiser LLP, had been the Company's auditors since it became a registered investment company in 1980. Although shareholder ratification is not required by law, to be consistent with past practice the firm's selection is being submitted for ratification by the shareholders, which requires the affirmative vote of a majority of the shares of the Company present at the meeting. If shareholders do not ratify their selection, the Board will reconsider the matter and will decide whether to retain that firm. The Audit Committee and Board of Directors reviewed the services performed by Weiser LLP during the last fiscal year and determined that such services did not affect their independence. The firm has no direct or indirect financial interest in the Company, except for fees received by it for services which were furnished at customary rates and terms. Representatives of the firm are expected to be present at the meeting, will be given an opportunity to make such statements as they feel appropriate, and will be available to respond to appropriate questions. Audit Fees - Weiser LLP billed the Company a total of $35,495 for the 2006 fiscal year, and $40,780 was billed by Leslie Sufrin and Company, P.C. for the 2005 fiscal year, for the audit of the Company's annual financial statements and in connection with statutory and regulatory filings for those years. Audit-Related Fees - No fees were billed to the Company for the last two fiscal years for any audit-related services. Tax Fees - No fees were billed to the Company for the last two fiscal years for tax compliance, tax advice or tax planning. All Other Fees - No fees were billed to the Company for the last two fiscal years for any other services. INVESTMENT ADVISORY AGREEMENT AND ADVISER The Company's investment adviser is J.P. Morgan Investment Management Inc., conducting business under the name JP Morgan Asset Management ("Morgan"), 522 Fifth Avenue, New York, NY 10036. The Investment Advisory Agreement dated July 1, 2000 (the "Agreement") between the Company and Morgan was most recently approved by the shareholders at the annual meeting on June 20, 2000 and expires June 30, 2006. On May 25, 2006, the Board of Directors (including the Company's independent directors) unanimously approved a continuation of the Agreement until June 30, 2007 (subject to the early termination provisions contained in the Agreement). Under the Agreement Morgan, subject to the general supervision of the Company's Board of Directors and in conformance with the stated policies of the Company, manages investment operations and the composition of the Company's portfolio of securities and - 8 - investments. In this regard, it is the responsibility of Morgan to make investment decisions for the Company and to place the purchase and sale orders for the portfolio transactions of the Company. As compensation for the services rendered and related expenses borne by Morgan, the Company, under the Agreement, has paid Morgan an annual fee, computed and payable quarterly, equal to 0.28% of the Company's net assets under management. Morgan received fees aggregating $105,610 applicable to the year ended April 30, 2006. The investment advisory services of Morgan to the Company are not exclusive under the terms of the Agreement. Morgan is free to, and does, render investment advisory services to others, including numerous funds. Morgan seeks to obtain the best price and execution of orders placed for the Company's assets considering all of the circumstances. If transactions are executed in the over-the-counter market, Morgan will deal with the principal market makers, unless more favorable prices and executions are otherwise obtainable. There is no agreement by Morgan with any broker or dealer to place orders with it. When circumstances relating to a proposed transaction indicate that a particular broker or dealer is in a position to provide the best execution considering all factors including price, the order is placed with that broker or dealer. This may or may not be a broker or dealer which has provided statistical or other factual information to Morgan. Subject to the requirement of seeking the best price and execution, Morgan may, in circumstances in which two or more brokers are in a position to offer comparable prices and execution, give preference to a broker or dealer which has provided statistical and other factual information to it. Morgan is of the opinion that while such information is useful in varying degrees, it is of indeterminable value and does not reduce the expenses of Morgan. In recognition of the brokerage execution services Morgan may pay a brokerage commission in excess of that which another broker might have charged for the same transaction. Morgan periodically evaluates the overall reasonableness of brokerage commissions paid by the Company. The factors considered in these evaluations include the competitive negotiated rate structure at the time the commission is charged and the effectiveness of the broker's execution. The names and principal occupations of the directors and principal executive officers of Morgan are as follows. All of them may be reached c/o J.P. Morgan Investment Management Inc., 522 Fifth Avenue, New York, NY 10036. Name Position at Morgan* ---- ------------------ Evelyn V. Guernsey President; Director George C.W. Gatch Director Seth P. Bernstein Global Head of Fixed Income Clive Brown Director Lawrence M. Unrein Director Martin R. Porter Global Head of Equities Andrew Spencer Chief Investment Officer of U.S. Retail Business Anthony M. Roberts Head of Legal Thomas J. Smith Chief Compliance Officer ------------------------------- * Each of them is also a Managing Director, which is an officer's title. Those who hold it are not necessarily directors of Morgan. - 9 - SUPPLEMENTAL INFORMATION The executive officers of the Company, all of whom serve at the pleasure of the Board of Directors, are as follows: Peter Goodman (President), Warren F. Pelton (Vice President and Treasurer) and I. Robert Harris (Secretary). Messrs. Goodman and Harris have served in their respective positions since the Company registered with the Securities and Exchange Commission as an investment company in April, 1980. Mr. Pelton became Vice President and Treasurer in 1995. Mr. Harris has been of counsel to the law firm of Kantor, Davidoff, Wolfe, Mandelker & Kass, P.C., general counsel to the Company, for more than the past 5 years. SHAREHOLDER PROPOSALS FOR 2007 ANNUAL MEETING Next year's annual meeting of shareholders of the Company will be held in June, 2007. Shareholders wishing to have their proposals included in the Company's Proxy Statement which will relate to that meeting must submit their proposals, preferably by certified mail, return receipt requested, to the Company at its address listed on the first page of this Proxy Statement so that the proposals are received no later than February 1, 2007. OTHER MATTERS As of the date of this Proxy Statement, the Board of Directors is not aware of any matters to be presented for action at the meeting other than those described above. Should other business properly be brought before the meeting, the persons named in the proxy have discretionary authority to vote in accordance with their best judgment in the interest of the Company. Dated: June 1, 2006 By Order of the Board of Directors I. Robert Harris, Secretary - 10 - Tridan Corp. Financial Statements April 30, 2006 and 2005 Tridan Corp. Contents April 30, 2006 and 2005 -------------------------------------------------------------------------------- Page(s) Report of Independent Registered Public Accounting Firm .................. 1 Report of Independent Registered Public Accounting Firm .................. 2 Financial Statements Statements of Assets and Liabilities April 30, 2006 and 2005 ................................................ 3 Schedules of Investments in Municipal Obligations April 30, 2006 and 2005 ................................................ 4-7 Statements of Operations Years Ended April 30, 2006 and 2005 .................................... 8 Statements of Changes in Net Assets Years Ended April 30, 2006, 2005 and 2004 .............................. 9 Notes to Financial Statements............................................. 10-14 [LETTERHEAD OF WEISER LLP] Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors Tridan Corp. We have audited the accompanying statement of assets and liabilities of Tridan Corp. (the "Company"), including the schedule of investments in municipal obligations, as of April 30, 2006, and the related statements of operations and changes in net assets for the year then ended and the financial highlights (Note 7) for the year then ended. These financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit. 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 and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned, as of April 30, 2006, by correspondence with the custodian. 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 audit provides a reasonable basis for our opinion. In our opinion, the financial statements and the financial highlights referred to above present fairly, in all material respects, the financial position of Tridan Corp. as of April 30, 2006, and the results of its operations, changes in net assets and financial highlights for the year then ended, in conformity with accounting principles generally accepted in the United States of America. /s/ Weiser LLP New York, NY May 22, 2006 1 [LETTERHEAD OF LESLIE SUFRIN AND COMPANY, P.C.] Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors Tridan Corp. We have audited the accompanying statements of assets and liabilities of Tridan Corp. (the "Company"), including the schedules of investments in municipal obligations, as of April 30, 2005, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended and the financial highlights (Note 7) for each of the four years in the period then ended. These financial statements and financial highlights are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audit. 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 and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned, as of April 30, 2005, by direct correspondence with the custodian. 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 audit provides a reasonable basis for our opinion. In our opinion, the financial statements and the financial highlights, referred to above, present fairly, in all material respects, the financial position of Tridan Corp. as of April 30, 2005, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the four years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. /s/ Leslie Sufrin and Company, P.C. New York, NY May 19, 2005 2 Tridan Corp. Statements of Assets and Liabilities April 30, 2006 and 2005 --------------------------------------------------------------------------------

The accompanying notes are an integral part of these financial statements. 3 Tridan Corp. Schedules of Investments in Municipal Obligations Years Ended April 30, 2006 and 2005 --------------------------------------------------------------------------------

The accompanying notes are an integral part of these financial statements. 4 Tridan Corp. Schedules of Investments in Municipal Obligations Years Ended April 30, 2006 and 2005 --------------------------------------------------------------------------------

The accompanying notes are an integral part of these financial statements. 5 Tridan Corp. Schedules of Investments in Municipal Obligations Years Ended April 30, 2006 and 2005 --------------------------------------------------------------------------------

The accompanying notes are an integral part of these financial statements. 6 Tridan Corp. Schedules of Investments in Municipal Obligations Years Ended April 30, 2006 and 2005 --------------------------------------------------------------------------------

(*) Represents percentage of net assets. The accompanying notes are an integral part of these financial statements. 7 Tridan Corp. Statements of Operations Years Ended April 30, 2006 and 2005 --------------------------------------------------------------------------------

The accompanying notes are an integral part of these financial statements. 8 Tridan Corp. Statements of Changes in Net Assets Years Ended April 30, 2006, 2005 and 2004 --------------------------------------------------------------------------------

The accompanying notes are an integral part of these financial statements. 9 Tridan Corp. Notes To Financial Statements Years Ended April 30, 2006 and 2005 -------------------------------------------------------------------------------- 1. Significant accounting policies The following is a summary of the significant accounting policies followed by Tridan Corp. (the "Company"), a closed-end, non-diversified management investment company, registered under the Investment Company Act of 1940, in the preparation of its financial statements. Acquisition and valuation of investments Investment transactions are accounted for on the date the securities are purchased/sold (trade date) and interest on securities acquired/sold is included in income from/to the settlement date. Short-term investments are stated at cost, which is equivalent to fair value. Fair values for the Company's investments in municipal obligations have been determined based on the bid price of the obligation. Securities for which quotations are not readily available are valued at fair value as determined by the board of directors. There were no securities valued by the board of directors, for which quotations were not readily available, as of April 30, 2006 and 2005. Amortization of bond premium or discount In determining investment income, bond premiums or discounts are amortized over the remaining term of the obligation. Income taxes It is the Company's policy to comply with the requirements of the Internal Revenue Code that are applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no income tax provision is required. Interest income from municipal investments are exempt from Federal and state income taxes. Cash and cash equivalents The Company considers all investments that can be liquidated on demand to be cash equivalents. Use of estimates The preparation of financial statements, in conformity with generally accepted accounting principles, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Significant estimates are used in determining the fair value of investments. 10 Tridan Corp. Notes To Financial Statements Years Ended April 30, 2006 and 2005 -------------------------------------------------------------------------------- Concentration of credit risk The Company's financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and investments. The Company maintains all of its cash on deposit in one financial institution. At times, such amounts on deposit may be in excess of amounts insured by the Federal Deposit Insurance Corporation. The value of the Company's investments may be subject to possible risks involving, among other things, the continued credit worthiness of the various state and local government agencies and public financing authorities underlying its investments. The Company and its investment advisor periodically consider the credit quality of the Company's investments, and the Company adheres to its investment objective of investing only in investment grade securities. 2. Cash and cash equivalents Cash and cash equivalents consisted of the following: April 30, ---------------------- 2006 2005 ---------- ---------- Cash - demand deposits $ 431,425 $1,071,382 Cash equivalents - demand bonds and notes 995,000 -- ---------- ---------- $1,426,425 $1,071,382 ========== ========== 3. Accounts payable and accrued liabilities Accounts payable and accrued liabilities consisted of the following at: April 30, ---------------------- 2006 2005 ---------- ---------- Accrued investment advisory fees (a) $ 26,000 $ 27,000 Accrued fees - affiliate (b) 23,225 20,551 Accrued audit fees (c) 35,000 31,495 Accrued administrative and accounting expenses 6,439 24,400 ---------- ---------- $ 90,664 $ 103,446 ========== ========== (a) The Company utilizes the services of J.P. Morgan Investment Management, Inc. ("J.P. Morgan") as its investment advisor and custodian for its investments. The annual advisory fee is .28 of one percent of the net assets under management. The fee is computed and payable quarterly, based on the aggregate fair value of the net assets on the last day of each fiscal quarter. (b) For the years ending April 30, 2006 and 2005, the Company incurred legal fees of approximately $84,000 and $70,000, respectively, for professional fees paid to the law firm of which an officer of the Company is a member. 11 Tridan Corp. Notes To Financial Statements Years Ended April 30, 2006 and 2005 -------------------------------------------------------------------------------- (c) For the years ending April 30, 2006 and 2005, the Company incurred audit fees of approximately $35,000 and $41,000, respectively. 4. Investment transactions Purchases and sales of investments in municipal obligations (excluding short-term and demand investments) amounted to approximately $5,172,000 and $5,460,000 for the year ended April 30, 2006 and $4,728,000 and $5,074,000, respectively, for the year ended April 30, 2005. The U.S. Federal income tax basis (aggregate cost) of the Company's investments, at April 30, 2006 and 2005, was approximately $35,073,000 and $35,419,000, respectively, and net unrealized appreciation, at April 30, 2006 and 2005, for U.S. Federal income tax purposes was approximately $582,000 and $2,076,000, respectively (gross unrealized appreciation of approximately $850,000 and $2,093,000, respectively; gross unrealized depreciation of approximately $268,000 and $17,000, respectively). 5. Common stock, share redemption plan and net asset values At April 30, 2006 and 2005, there were 6,000,000 shares of $0.02 par value common stock authorized of which 3,199,100 had been issued, aggregating $63,982, and additional paid-in capital aggregating $312,787. The Company has a share redemption plan applicable to approximately 52,000 shares and 55,000 shares, respectively, of outstanding common stock, at April 30, 2006 and 2005. The plan permits eligible shareholders or their estates to have their shares redeemed by the Company upon reaching age 65 or upon death. Shares are redeemed at the net asset value per share, based on fair value, as of the end of the Company's fiscal quarter in which the request for redemption is received. At April 30, 2006 and 2005, $984,115 (83,888.5487 shares) and $942,839 (80,529.2982 shares), respectively, had been redeemed under this plan and are held in treasury. The net asset value per share is calculated by dividing the aggregate fair value of all assets less the aggregate fair value of all liabilities by the number of common shares outstanding at the end of the period. The net asset value per share and the shares outstanding were as follows: April 30, ---------------------- 2006 2005 ---------- ---------- Net asset value $ 12.04 $ 12.51 Shares outstanding at: April 30, 2006 3,115,211.4513 April 30, 2005 3,118,570.7018 12 Tridan Corp. Notes To Financial Statements Years Ended April 30, 2006 and 2005 -------------------------------------------------------------------------------- 6. Distributions During the years ended April 30, 2006 and 2005, distributions of $1,464,979 ($.47 per share) and $1,497,705 ($.48 per share), respectively, were declared and paid to shareholders, which, except for capital gains of $160,462 in 2006 and $117,464 in 2005, were exempt from Federal income taxes. The tax character of distributions paid during the years ending April 30, 2006 and 2005 was as follows: 2006 2005 ---------- ---------- Distributions paid from: Tax-exempt investment income, net $1,304,517 $1,380,241 Capital gains 160,462 117,464 ---------- ---------- $1,464,979 $1,497,705 ========== ========== As of April 30, 2006 and 2005, the components of distributable earnings on a tax basis were as follows: 2006 2005 ---------- ---------- Overdistributed tax-exempt investment income, net $ (35,077) $ (50,226) Undistributed capital gains 68,340 64,897 Unrealized appreciation of investments, net 582,443 2,075,444 ---------- ---------- $ 615,706 $2,090,115 ========== ========== The Company has no capital loss carryforwards or book/tax differences as of April 30, 2006 and 2005. The Company had no capital reclassification related to permanent book/tax differences for years ending April 30, 2006 and 2005. 13 Tridan Corp. Notes To Financial Statements Years Ended April 30, 2006 and 2005 -------------------------------------------------------------------------------- 7. Financial highlights

14 Appendix TRIDAN CORP. AUDIT COMMITTEE CHARTER Organization This charter governs the operations of the audit committee. The committee shall review and reassess the charter at least annually and obtain the approval of the board of directors. The committee shall be appointed by the board of directors and shall comprise at least three directors, each of whom is "independent" of management and the Company. Members of the committee will be considered independent if they do not receive, other than for service on the board of directors, any consulting, advisory, or other compensatory fees from the Company, are not "interested persons" of the Company, as defined in the Investment Company Act of 1940, and comply with the definition of independence in Rule 4200(a)(15) of the NASD listing standards. All committee members shall be financially literate, and at least one member shall be an "audit committee financial expert" as defined by SEC regulations. Statement of Policy The audit committee shall provide assistance to the board of directors in fulfilling their oversight responsibility to the shareholders, potential shareholders, the investment community, and others relating to the Company's financial statements and the financial reporting process, the systems of disclosure controls and procedures and internal accounting and financial controls, the annual independent audit of the Company's financial statements, and compliance with regulatory requirements and with ethics programs as established by management and the board. In so doing, it is the responsibility of the committee to maintain free and open communication between the committee, independent auditors, the internal auditors and management of the Company. In discharging its oversight role, the committee is empowered to investigate any matter brought to its attention with full access to all books, records, facilities, and personnel of the Company and the power to retain outside counsel, or other experts for this purpose. Responsibilities and Processes The primary responsibility of the audit committee is to oversee the Company's financial reporting process on behalf of the board and report the results of their activities to the board. While the audit committee has the responsibilities and powers set forth in this charter, it is not the duty of the audit committee to plan or conduct audits or to determine that the Company's financial statements are complete and accurate and are in accordance with generally accepted accounting principles. Management is responsible for preparing the Company's financial statements in accordance with generally accepted accounting principles, and the independent auditors are responsible for auditing those financial statements. The committee in carrying out its responsibilities believes its policies and procedures should remain flexible, in order to best react to changing conditions and circumstances. The committee should take the appropriate actions to set the overall corporate "tone" for quality financial reporting, sound business risk practices, and ethical behavior. App 1 The following shall be the principal recurring processes of the audit committee in carrying out its oversight responsibilities. The processes are set forth as a guide with the understanding that the committee may supplement them as appropriate and consistent with SEC rules and regulations. o The committee shall have a clear understanding with management and the independent auditors that the independent auditors are ultimately accountable to the board and the audit committee, as representatives of the Company's shareholders. The committee shall have the ultimate authority and responsibility to evaluate and, where appropriate, replace the independent auditors. The committee shall discuss with the auditors their independence from management and the Company and the matters included in the written disclosures required by generally accepted auditing standards and by applicable SEC rules and regulations. Annually, the committee shall review and recommend to the board the selection of the company's independent auditors, subject to shareholders' approval. o The committee shall discuss with the Company's administrator and independent auditors the overall scope and plans for their respective audits, and any other services to be performed by them, including the adequacy of staffing and compensation, all of which services shall be subject to the committee's approval. Also, the committee shall discuss with them the auditors' report on the adequacy and effectiveness of disclosure controls and procedures and internal control over financial reporting. The committee shall also review with the auditors the Company's system to monitor and manage business risk, and legal and ethical compliance programs. o The committee shall review the interim financial statements with management and the independent auditors prior to their issuance. Also, the committee shall discuss the results of their review and any other matters required to be communicated to them by the independent auditors under generally accepted auditing standards. The chair of the committee may represent the entire committee for the purposes of this review. o The committee shall review with management and the independent auditors the financial statements to be included in the Company's annual report to shareholders, including their judgment about the quality, not just acceptability, of accounting principles, the reasonableness of significant judgments, and the clarity of the disclosures in the financial statements. The committee shall recommend to the board whether the audited statements shall be issued to the shareholders and filed with the SEC. Also, the committee shall discuss the results of the annual audit and any other matters required to be communicated to the committee by the independent auditors under generally accepted auditing standards and applicable SEC rules and regulations. App 2 Tridan Corp. and Tridan Corp. Employees Stock Ownership Trust Privacy Policy The directors and management of Tridan Corp. and Tridan Corp. Employees Stock Ownership Trust ("ESOT") respect the privacy of nonpublic personal information that we collect from our shareholders and ESOT participants. This notice provides information regarding our policies and practices surrounding the collection and handling of nonpublic personal information. The words "we" and "us" refer to Tridan Corp. and the ESOT. The words "you" and "your" refer to our shareholders and ESOT participants, present and past. Types of Information We Collect During the course of our relationship, you sometimes share with us nonpublic personal information, such as your address, social security number, age, and number of shares owned by you. We collect this information from applications, verbal communications, and correspondence with you. We may also receive this information from firms that assist us in administering your account and processing transactions on your behalf. We collect this information in order to handle your account properly and provide you with the services you expect to receive. Use and Disclosure of Personal Financial Information We may use your nonpublic personal information in order to provide you with distributions, custodial, accounting, administrative and other shareholder services. We do not disclose any nonpublic personal information about you to anyone, except as permitted by law. We are permitted under law to disclose nonpublic personal information about you to third parties in certain circumstances. For example, we may disclose your nonpublic personal information to third parties that assist us in providing services to you. On occasion, we may be required to provide information about you and your accounts and transactions to governmental agencies, in order to fulfill legal and regulatory requirements. We will comply with these laws, to the extent we are required to do so. Safeguarding Your Personal Financial Information We restrict access to your nonpublic personal information to those who have a need to know that information in order to provide services to you. We maintain physical, electronic, and/or procedural safeguards that meet the standards of applicable laws and regulations. TRIDAN CORP. ANNUAL MEETING OF SHAREHOLDERS - JUNE 20, 2006 THIS PROXY IS SUBMITTED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoints PETER GOODMAN, I. ROBERT HARRIS and WARREN F. PELTON, and each of them, with power of substitution, as proxies of the undersigned, to vote all of the shares of stock which the undersigned is entitled to vote at the above stated Annual Meeting of Shareholders on June 20, 2006, and all adjournments thereof. (1) FOR the election, as directors, WITHHOLD AUTHORITY of all nominees listed below to vote for all (except as marked to nominees listed the contrary below) below |_| |_| (INSTRUCTION: To withhold authority to vote for any individual nominee, strike a line through that nominee's name in the list below.) MARK GOODMAN, PETER GOODMAN, PAUL KRAMER, JAY STANLEY NEGIN, WARREN FRED PELTON, RUSSELL JUDE STOEVER ---------------------------------------------- (2) FOR |_| AGAINST |_| ABSTAIN |_| the ratification of the selection of Weiser LLP as auditors of the Company for the fiscal year ending April 30, 2007; (3) Upon any other matter which may properly come before the meeting, in their discretion. Every properly signed proxy will be voted in the manner specified hereon and, in the absence of such specification, will be voted FOR the election of directors and FOR Item (2) above. PLEASE SIGN AND RETURN PROMPTLY, USING THE ENCLOSED ENVELOPE Receipt of the Notice ___________________________ of Annual Meeting and Signature Proxy Statement is hereby acknowledged ___________________________ Signature Dated: 2006 IMPORTANT: Joint owners must EACH sign. When signing as attorney, trustee, executor, administrator, guardian or corporate officer, please give your full title.