West Palm Beach, Florida, October 3, 2006 – The ComVest Group, through its non-control investment fund, ComVest Capital, announced it will provide a $4.0 M term loan to Alanco Technologies, Inc. (NASDAQ: ALAN), to repay short-term notes and provide working capital to fund operations. Headquartered in Scottsdale, AZ, Alanco is a leading provider of wireless tracking and asset management solutions.

Robert R. Kauffman, Alanco Chairman and Chief Executive Officer, stated, “We believe that, at current market prices, our stock is significantly undervalued and, in particular, does not reflect the value contributed by our June 30, 2006 acquisition of StarTrak. Consequently, we determined that a debt financing would best serve our shareholders’ interests. This new financing will provide sufficient working capital for Alanco to achieve fiscal year 2007 sales growth projections in both its TSI PRISM and StarTrak Systems wireless tracking business.”

Larry Lenig, Senior Partner and Portfolio Manager of ComVest Capital, stated, “We are pleased with the opportunity to work with Alanco and its StarTrak and TSI PRISM subsidiaries. We believe the financing provides a foundation to support present operating initiatives and anticipated growth, and we look forward to working with management as the Company develops opportunities in the future.”

About Alanco Technologies, Inc. (NASDAQ: ALAN)
Headquartered in Scottsdale, Arizona, Alanco is a rapidly growing provider of wireless tracking and asset management solutions through its StarTrak Systems and Alanco/TSI PRISM subsidiaries. Corporate website: www.alanco.com

StarTrak Systems is a leading provider of GPS tracking and wireless asset management services to the transportation industry and the dominant provider of tracking, monitoring and control services to the refrigerated or “Reefer” segment of the transportation marketplace. StarTrak products increase efficiency and reduce costs of the refrigerated supply chain through the wireless monitoring and control of critical Reefer data, including GPS location, cargo temperatures and Reefer fuel levels. StarTrak offers complete integrated solutions for tracking, monitoring and controlling refrigerated trailers, trucks, railcars, and containers. Additional information is available at www.StarTrak.com.

Alanco/TSI PRISM is the leading provider of RFID real-time tracking technologies for the corrections industry. TSI PRISM systems track and record the location and movement of inmates and officers, resulting in enhanced facility safety and security and significant staff productivity improvements. Utilizing proprietary RFID (Radio Frequency Identification) tracking technology, TSI PRISM provides real-time inmate and officer identification, location and tracking both indoors and out. TSI PRISM is currently utilized in prisons in Michigan, California, Illinois, Ohio, Missouri, and Virginia. Additional information is available at www.TSIPRISM.com.

The Company also participates in the data storage industry through its Excel/Meridian Data, Inc. subsidiary, a manufacturer of Network Attached Storage (NAS) systems. Additional information is available at www.excelmeridian.com.

About The ComVest Group
The ComVest Group is a Leading Private Equity Firm focused on investing in middle-market companies. Since 1988 ComVest has invested more than $2 billion of equity capital in over 200 public and private companies worldwide. Through our extensive financial resources and broad network of industry experts, we are able to offer our companies total financial sponsorship, critical strategic support, and business development assistance. Their focus is centered on building industry leading companies and creating long term value for equity holders. For more information on ComVest, visit www.comvest.com.

Included in this release are “forward-looking statements.” Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations reflected in such forward-looking statements will prove to have been correct. The Company’s actual results could differ materially from those anticipated in the forward-looking statements. The Company refers you to the cautionary statements and risk factors set forth in the documents it files with the Securities and Exchange Commission, including its most recent 10-KSB. The Company is not under any obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise.