ANNUAL MEETING May 10, 2007

ANNUAL HIGHLIGHTS 2006 FISCAL YEAR (millions) SALES$ NET INCOME % EPS SHAREHOLDERS” EQUITY$ 64.1$ %

2006 ACCOMPLISHMENTS Geographical Expansion  Rubber Compounding – North Carolina  South American Track Project

2006 ACCOMPLISHMENTS Product Innovation  South America Track Fastening plus proto-type long reach clips  3 rd Generation CBRN footwear in production & 4 th generation in proto-type  1 st CBRN Fireboot

2006 ACCOMPLISHMENTS Efficiency & Stability  Rubber Compound Cycle Times  Improvements in Acton-Vale and Scotland Neck  Renewed Debt Facilities

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FIRST QUARTER HIGHLIGHTS 1 st QUARTER (millions) SALES$59.7$61.1 GROSS MARGIN EXPENSES INTEREST EBT$ 1.7$ 2.7

FIRST QUARTER HIGHLIGHTS Major Markets Improving  BELTING  RUBBER TRACK  MILITARY

RECENT NEWS Rail Products  New Mexico Rail Runner Project 77,000 Tie Project with New Tie Captive System  Continuation of South America with a 465,000 Clip Order  Newly Designed HD Insulator approved by BNSF

RECENT NEWS AirBoss-Defense  Finalizing an order for $3 Million AMG  Letter of Intent for $6.4 million Gas Masks with an option for $3.2 million

RECENT NEWS Rubber Compounding  Strategic Alliance Agreements with many of NA Leading Rubber Products Manufacturers in Various Market Segments

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CHAIRMAN’S CLOSING COMMENTS AirBoss has been profitable since 1995 We continue to see growth for the future  As a result of the significant investments we have recently made we can grow compounding revenues by almost 50% with current capacity  Conveyor belting demand forecast to continue to grow  Defense – finally getting orders! New products being developed Valuation  Recent industry transactions would suggest that our shares are significantly undervalued  Sale of Goodyear industrial 1x sales

CHAIRMAN’S CLOSING COMMENTS cont’d.  Recent transactions in the defense sector would value our defense division at close to $2 per share.  We will continue to work to improve our valuation New Dividend Policy  Semi-annual dividend  Initial 2.5 cents payable to shareholders of record June 30, 2007

QUESTION AND ANSWER PERIOD

FORWARD LOOKING STATEMENT DISCLAIMER This report contains forward-looking statements, which reflect managements best judgment based on factors currently known but involve significant risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including but not limited to risks more fully described in the “Risk Factors” section of the Company’s Annual Report, and other risks detailed in filings with the Ontario Securities Commission. Forward-looking information provided pursuant to the safe harbor established by recent securities legislation should be evaluated in the context of these factors.

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