Item 1.01 Entry into a Material Agreement

Alanco Technologies, Inc. ("Alanco") received notification today of final resolution in favor of Alanco to a legal suit filed by Technology Systems International, Inc., a Nevada corporation ("TSIN") related to Alanco's June 2002 acquisition of TSIN assets. The resolution was determined under a September 2007 court-approved Settlement Agreement and Mutual Release ("Agreement"). In accordance with the terms of the resolution, the legal suit is resolved without consideration to be paid by either party. The Agreement was previously disclosed in Alanco's Form 8-K filed on September 21, 2007.