10-Q

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

/x/
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2001.

OR

/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                to               

Commission file number 001-14617

ANDREW CORPORATION
(Exact name of Registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization) 36-2092797
(IRS Employer identification No.)

10500 W. 153rd Street, Orland Park, Illinois 60462
(Address of principal executive offices and zip code)

(708) 349-3300
(Registrant's telephone number, including area code)

No Change
(Former name, former address and former fiscal year, if changed since last report)

    Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period as the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes /x/  No / /

    Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date.

    Common Stock, $.01 Par Value—81,394,864 shares as of April 30, 2001

INDEX
ANDREW CORPORATION

PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Consolidated balance sheets—March 31, 2001 and September 30, 2000.
	Consolidated statements of income—Three and six months ended March 31, 2001 and 2000.
	Consolidated statements of cash flows—Six months ended March 31, 2001 and 2000.
	Notes to consolidated financial statements—March 31, 2001.
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.
PART II.	OTHER INFORMATION
Item 4.	Submission of Matters to a Vote of Security Holders
Item 6.	Exhibits and Reports on Form 8-K.
SIGNATURES

2

ANDREW CORPORATION
CONSOLIDATED BALANCE SHEET
(In Thousands)

		March 31 2001			September 30 2000
		(Unaudited)
ASSETS
Current Assets
Cash and cash equivalents		$	57,000		$	44,865
Accounts Receivable, less allowances (March—$4,135; September—$2,983)			223,580			263,016
Inventories
	Finished products		74,764			77,082
	Materials and work in process		130,704			127,086
			205,468			204,168
Miscellaneous current assets			8,226			12,632
Total Current Assets			494,274			524,681
Other Assets
Cost in excess of net assets of businesses acquired, less accumulated amortization (March—$10,871; September—$8,625)			36,137			37,799
Investments in and advances to affiliates			41,844			51,759
Other assets			6,885			7,698
Property, Plant, and Equipment
Land and land improvements			19,612			19,291
Building			92,820			95,510
Equipment			404,069			370,286
Allowances for depreciation			(305,508	)		(289,827	)
			210,993			195,260
Total Assets		$	790,133		$	817,197
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Notes payable			35,625			45,771
Accounts payable			45,566			58,538
Accrued expenses and other liabilities			17,830			18,557
Compensation and related expenses			17,270			30,303
Income taxes			6,010			5,639
Current portion of long-term debt			6,282			15,215
Total Current Liabilities			128,583			174,023
Deferred Liabilities			24,685			25,132
LONG-TERM DEBT, less current portion			64,752			65,843
MINORITY INTEREST			2,205			9,254
STOCKHOLDERS' EQUITY
Common stock (par value, $.01 a share:
	400,000,000 shares authorized;
	102,718,210 shares issued, including treasury)		1,027			1,027
Additional paid-in capital			65,749			64,136
Retained earnings			790,223			761,131
Accumulated other comprehensive income			(41,304	)		(35,801	)
Treasury stock, at cost (21,323,346 shares in March; 21,476,101 shares in September)			(245,787	)		(247,548	)
			569,908			542,945
TOTAL LIABILITIES AND EQUITY		$	790,133		$	817,197

See Notes to Consolidated Financial Statements

3

ANDREW CORPORATION
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In thousands, except per share amounts)

		Three Months Ended March 31						Six Months Ended March 31
		2001			2000			2001			2000
Sales		$	234,526		$	242,663		$	515,048		$	476,231
Cost of products sold			167,627			164,688			358,364			322,211
Gross Profit			66,899			77,975			156,684			154,020
Operating Expenses
Research and development			12,312			8,797			23,819			18,443
Sales and administrative			42,405			40,063			84,900			81,552
			54,717			48,860			108,719			99,995
Operating Income			12,182			29,115			47,965			54,025
Other
Interest expense			1,733			2,332			4,137			3,710
Interest income			(440	)		(562	)		(1,053	)		(947	)
Other (income) expense, net			(1,116	)		1,904			2,098			1,166
			177			3,674			5,182			3,929
Income Before Taxes			12,005			25,441			42,783			50,096
Income taxes			3,842			8,141			13,691			16,029
Net Income		$	8,163		$	17,300		$	29,092		$	34,067
Basic and Diluted Earnings per Share		$	0.10		$	0.21		$	0.36		$	0.42
Average Shares Outstanding
	Basic		81,394			80,565			81,355			80,865
	Diluted		81,515			81,039			81,549			81,160

See Notes to Consolidated Financial Statements

4

ANDREW CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In thousands)

		Six Months Ended March 31
		2001			2000
Cash Flows from Operations
Net income		$	29,092		$	34,067
Adjustments to Net Income
	Restructuring costs		0			3,398
	Depreciation and amortization		24,763			21,017
	Decrease (increase) in accounts receivable		36,381			(26,525	)
	Increase in inventories		(4,645	)		(48,503	)
	Decrease in misc. current and other assets		4,839			1,343
	Decrease in receivables from affiliates		0			22
	(Decrease) increase in accounts payable and other liabilities		(22,743	)		20,884
	Other		376			928
Net Cash From Operations			68,063			6,631
Investing Activities
	Capital expenditures		(41,162	)		(41,158	)
	Acquisition of businesses, net of cash acquired		(6,300	)		(14,929	)
	Investments in and advances to affiliates, net		9,876			4,252
	Proceeds from sale of property, plant and equipment		507			158
Net Cash Used in Investing Activities			(37,079	)		(51,677	)
Financing Activities
	Long-term (payments), net		(8,926	)		(2,447	)
	Short-term (payments) borrowings, net		(9,937	)		64,721
	Purchase of treasury stock		0			(24,630	)
	Stock purchase and option plans		450			3,342
Net Cash (Used In) From Financing Activities			(18,413	)		40,986
Effect of exchange rates on cash			(436	)		(1,941	)
Total Increase (Decrease) for the Period			12,135			(6,001	)
Cash and equivalents at beginning of period			44,865			38,287
Cash and equivalents at end of period		$	57,000		$	32,286

See Notes to Consolidated Financial Statements

5

ANDREW CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A—BASIS OF PRESENTATION

    The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six month periods ended March 31, 2001 are not necessarily indicative of the results that may be expected for the year ending September 30, 2001. For further information, refer to the consolidated financial statements and footnotes thereto included in the company's annual report on Form 10-K for the year ended September 30, 2000.

NOTE B—EARNINGS PER SHARE

    The following table sets forth the computation of basic and diluted earnings per share:

			Three Months Ended March 31				Six Months Ended March 31
			2001		2000		2001		2000
(In thousands, except per share amounts)
BASIC EARNINGS PER SHARE
Numerator:
	Numerator for net income per share		$	8,163	$	17,300	$	29,092	$	34,067
Denominator:
	Weighted average shares outstanding			81,394		80,565		81,355		80,865
Net income per share—basic			$	0.10	$	0.21	$	0.36	$	0.42
DILUTED EARNINGS PER SHARE
Numerator:
	Numerator for net income per share		$	8,163	$	17,300	$	29,092	$	34,067
Denominator:
	Weighted average shares outstanding			81,394		80,565		81,355		80,865
	Effect of dilutive securities:
		Stock options		121		474		194		295
				81,515		81,039		81,549		81,160
Net income per share—diluted			$	0.10	$	0.21	$	0.36	$	0.42

    Options to purchase 3,656,467 shares of common stock, at prices ranging from $18.19 - $38.17 per share, were not included in the computation of diluted earnings per share for the six months ended March 2001 because the options' exercise prices were greater than the average market price of the common shares. Options to purchase 658,224 shares of common stock, at prices ranging from $24.50 - $38.17 per share, were not included in the six months ended March 2000 diluted earnings per share calculation because the options' exercise prices were higher than the average market price of the common shares.

NOTE C—BUSINESS AQUISITIONS

    In January 2001, the company purchased the 30% minority interest in the company's Brazilian operations for $7.0 million giving the company 100% ownership of this operation. The $7.0 million purchase price consists of a $6.0 million cash payment and $1.0 million payable within a year of the purchase. This acquisition was accounted for as a purchase, resulting in $0.3 million of goodwill. Pro forma net income, assuming this acquisition occurred on October 1, 1999, would not have been materially different from the reported results of operations.

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NOTE D—COMPREHENSIVE INCOME

    Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive Income" requires the company to report foreign currency translation adjustments as well as the change in fair value of derivatives designated as hedges, as a component of other comprehensive income. Comprehensive income for the six months ended March 31, 2001 and 2000 amounted to $23,589,000 and $28,910,000, respectively. Comprehensive income(loss) for the three months ended March 31, 2001 and 2000 amounted to ($221,000) and $13,723,000, respectively.

NOTE E—RECENTLY ISSUED ACCOUNTING POLICIES

    In July 2000, the FASB's Emerging Issues Task Force (EITF) reached a conclusion on EITF Issue 00-10, accounting for shipping and handling fees and costs. The company will adopt EITF Issue 00-10 starting in the fourth quarter of fiscal year 2001. Adoption of Issue 00-10 will not have a material effect on the company's financial statements. EITF Issue 00-10 requires that shipping and handling expenses billed to customers be recorded as part of sales revenue. The related expenses are required to be recorded in cost of products sold or elsewhere in the income statement with adequate disclosure. The company currently passes any shipping costs on to its customers at cost and does not record any shipping charges as part of sales revenue or cost of products sold. Adoption of EITF Issue 00-10 will not impact income or gross profit but will cause the gross profit percentage to decrease from what has historically been reported.

    In December 1999, the staff of the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 101, "Revenue Recognition in Financial Statements." The company will adopt SAB No. 101 in the fourth quarter of fiscal year 2001. Adoption of SAB No. 101 is not expected to have a material effect on the company's financial statements.

NOTE F—ADOPTION OF NEW ACCOUNTING POLICIES

    As of October 1, 2001, the company has adopted the Financial Accounting Standard Board's (FASB) statement No. 133, "Accounting for Derivative Instruments and Hedging Activities," as amended by FASB statement No. 138. These statements require that all derivatives be recorded on the balance sheet at fair value. Derivatives that are not designated as hedges must be adjusted to fair value through income. Changes in the fair value of derivatives designated as hedges will either be offset against the hedged item or in other comprehensive income until the hedged item is recognized in earnings. The ineffective portion of the change in fair value of derivatives that are designated as hedges will be immediately recognized into earnings. The adoption of these FASB statements did not have a material effect on the company's results of operations.

    At March 31, 2001, the company had several forward contracts in place to hedge the expected cash flow from an inter-company, Canadian dollar debt instrument. The fair value of these forward contracts resulted in an asset of $0.3 million as of March 31, 2001. The perfectly effective portion of the change in fair value of these hedge instruments has been offset by the change in value of this debt instrument or recorded in other comprehensive income. The ineffective portion of these cash flow hedges has been recognized into earnings and has not had a material impact on earnings.

NOTE G—SEGMENT

    The company manages its business as one operating segment. This segment serves commercial markets, including coaxial cable, terrestrial microwave systems, wireless accessories and other products and services.

7

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

    Sales for the quarter ended March 31, 2001 were $234.5 million, 3.4% lower than the same period last fiscal year. A slow down in spending on infrastructure by U.S. wireless service providers drove the decline in sales. Sales to the U.S. wireless infrastructure market, principally cable sales, were down compared to the exceptionally strong second quarter of fiscal year 2000. The European wireless infrastructure market remained strong, showing good growth, while sales in other regions declined or were flat. Fixed telecommunications network sales declined, mostly in the U.S. and Canada. Sales to the broadcast market increased, principally in the U.S. Wireless accessory sales declined slightly despite the fact that sales to the automotive industry continued to show strong growth. From a product standpoint cable sales decreased while terrestrial microwave, broadcast and earth station antennas all showed double-digit growth for the quarter compared to the second quarter of last fiscal year.

    Sales for the six months ended March 31, 2001 were $515.0 million, 8.2% higher than the first six months of last fiscal year. This growth in sales was due to the 20.1% increase in the first quarter of the fiscal year versus the first quarter of fiscal year 2000. Strong sales to the wireless infrastructure market in North America, Asia and Europe drove this increase. Due to a strong first quarter, sales have increased across all major markets and geographic areas for fiscal year 2001, compared to fiscal year 2000.

    Gross margin as a percentage of sales was 28.5% in the second quarter of 2001, compared to 32.1% for the same period last fiscal year. Gross margin decreased approximately 6.0 points due to lower prices, mainly due to lower cable and connector prices. Product mix caused approximately a 1.0 point decline in margin. These factors were offset by efficiency improvements that increased gross margin 3.4 points. Gross margin as a percentage of sales was 30.4% and 32.3% for the first six months of fiscal year 2001 and 2000, respectively. This decrease was due to pricing pressure, which was partially offset by increases in volume and improvements in production efficiency.

    Operating expenses as a percentage of sales were 23.3% in the second quarter of 2001, compared to 20.1% in the second quarter of 2000. Operating expenses increased 12.0% or $5.9 million primarily due to a 40.0% or $3.5 million increase in research and development expense. The company has continued to expand its efforts to develop products for existing and new markets. Major research and development efforts have been centered on power amplifiers, satellite modems and broadband wireless products, including antennas and repeaters. Sales and administrative expenses increased 5.8% or $2.3 million. This was due to an increase in sales expense related to heightened sales efforts, especially in the Asia-Pacific region. Operating expenses as a percentage of sales remained relatively flat at 21.1%, compared to 21.0% for the first six months of 2001 and 2000, respectively. Year to date operating expenses increased 8.7% or $8.7 million compared to last year. This was primarily due to a 29.1% or $5.4 million increase in research and development expenses.

    Compared to fiscal year 2000, interest expense decreased $0.6 million for the quarter and increased $0.4 million for the first six months of the fiscal year. The fluctuations in interest expense were driven by fluctuations in short-term borrowing, which decreased during fiscal year 2001. Other (income) / expense, net was income of $1.1 million for the quarter compared to expense of $1.9 million for the second quarter of 2000. This was largely due to an increase in foreign exchange gains and the elimination of minority interest expense for the company's Brazilian operations. For the first six months of the year other (income)/expense, net was expense of $2.1 million versus $1.2 million for the same period in fiscal year 2000. This increase was primarily due to foreign exchange losses recognized in the first quarter of 2001.

LIQUIDITY

    Cash and cash equivalents increased $12.1 million during the first half of fiscal 2001 to $57.0 million. Working capital totaled $365.7 million at March 31, 2001, compared to $350.7 million at September 30,

8

2000. Management believes the current working capital level is adequate to meet the company's normal operating needs. For the first half of fiscal year 2001 the company generated $68.1 million of cash flow from operations primarily from: $29.1 million of earnings, non-cash charges of $24.8 million for depreciation and amortization, and $36.4 million from the decrease in accounts receivable. The company generated $6.6 million of cash flow from operations in the first six months of 2000. For fiscal year 2001, the company has seen a normal seasonal trend with sales decreasing sequentially in the first and second quarter. The decrease in sales generated cash flow from operations as accounts receivable decreased and inventory levels grew modestly. In fiscal year 2000, the company saw exceptionally strong sales. Unlike the normal seasonal trends experienced by the company, sales grew sequentially in the first and second quarter of 2000. This growth in sales required the company to use cash to fund the growth in inventory and accounts receivable. The time required to collect accounts receivable remained relatively constant. Days sales in billed receivables increased slightly to 81 days from 79 days as of March 31, 2001 and March 31, 2000, respectively.

    Net cash used in investing activities during the first half of fiscal year 2001 was $37.1 million. Capital expenditures were $41.2 million. Substantial portions of these expenditures were focused on increasing cable production efficiency and capacity, especially in China and Brazil. In January 2001, the company acquired the 30.0% minority ownership in the company's Brazilian operations for $7.0 million. The company made a $6.0 million dollar payment in January 2001 and will make another $1.0 million payment within one year of the purchase date. In December 2000, the company paid $0.3 million of additional purchase consideration to certain Conifer Corporation shareholders as part of the December 1999 acquisition agreement. In the first six months of fiscal year 2000, the company acquired Conifer Corporation for $13.0 million and the controlling interest in Comtier Corporation for $2.0 million. The company's investment in its Russian joint telecommunications ventures decreased by $9.9 million during the first six months of year due to the refinancing of $7.9 million of advances from the company with bank financing guaranteed by the company.

    Net cash used in financing activities for the first six months of the year was $18.4 million, mainly due to reduction of debt. The company decreased its long-term debt by $8.9 million, due mostly to the payment of $8.8 million in the first quarter by the company's Brazilian operations. The company has reduced its short-term borrowing under its revolving credit agreements by $9.9 million during the year.

SAFE HARBOR FOR FORWARD-LOOKING STATEMENTS

    We have made forward-looking statements in this Form 10-Q under "Management's Discussion and Analysis of Financial Condition and Results of Operations." In addition, we or our representatives may make other written or oral statements that constitute forward-looking statements. Forward-looking statements are based on management's beliefs and assumptions and on information currently available to them. These statements often contain words like believe, expect, anticipate, intend, contemplate, seek, plan, estimate or similar expressions. We make these statements under the protection afforded them by Section 21E of the Securities Exchange Act of 1934.

    Forward-looking statements involve risks, uncertainties and assumptions, including those discussed in this report. We operate in a continually changing business environment, and new risk factors emerge from time to time. We cannot predict those risk factors, nor can we assess the impact, if any, of those risk factors on our business or the extent to which any factors may cause actual results to differ materially from those projected in any forward-looking statements. Forward-looking statements do not guarantee future performance, and you should not put undue reliance on them.

    While Andrew Corporation's management is optimistic about the company's long-term prospects, you should consider the risks and uncertainties in evaluating its growth outlook. Risks that may affect us include the volatility of our stock price, fluctuations in our operating results, the impact of economic fluctuations, intense competition and pricing pressure, rapid technological change and pressure for us to develop new products and risks associated with our international operations. For a more complete discussion of these and other risks, uncertainties and assumptions that may affect us, see Andrew's Annual Report on Form 10-K for the year ended September 30, 2000.

9

PART II—OTHER INFORMATION

ITEM 4. Submission of Matters to A Vote of Security Holders

(a) Andrew's Annual Meeting of Stockholders was held on February 13, 2001

(b) Items submitted to a vote

1.

Election of Directors

Nominee	For	Against	Broker/Non-Votes	Abstentions
J. G. Bollinger	74,092,721	0	0	1,817,480
G.M. Campbell	74,817,711	0	0	1,092,490
T.A. Donahoe	74,804,424	0	0	1,105,777
F.L. English	73,829,266	0	0	2,080,935
E. A. Fetter	74,807,049	0	0	1,103,152
J. D. Fluno	74,810,177	0	0	1,093,637
W. O. Hunt	73,254,832	0	0	2,655,369
C.R. Nicholas	74,792,263	0	0	1,117,938
G. O. Toney	74,779,782	0	0	1,130,419

2. The selection of Ernst & Young to serve as independent public auditors for fiscal year 2001. The selection of Ernst & Young as independent auditors was ratified by votes of 75,419,860 for, 132,034 against, and 358,307 abstentions.

Item 6. Exhibits and reports on Form 8-K

(a) Exhibit index

Exhibit No.	Description
10	Unsecured line of credit agreement with Bank One, NA London Branch dated January 19, 2001.

(b) Reports on form 8-K

    No reports on Form 8-K were filed during the quarter ended March 31, 2001.

10

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 thereunto duly authorized.

By:
/s/ GREGORY F. MARUSZAK Gregory F. Maruszak
Vice President Finance and Administration, and Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer)

Date May 11, 2001

11

EXHIBIT INDEX

Exhibit No.	Description
10	Unsecured line of credit agreement with Bank One, NA London Branch, dated January 19, 2001

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INDEX ANDREW CORPORATION

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

PART II—OTHER INFORMATION
ITEM 4. Submission of Matters to A Vote of Security Holders
Item 6. Exhibits and reports on Form 8-K

SIGNATURES
EXHIBIT INDEX

EX-10

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EXHIBIT 10

Unsecured line of credit agreement with Bank One, NA London Branch

Bank One, NA
1 Triton Square
London NW1 3FN

January 16, 2001

Mr. Jeffrey Gittelman
Vice president & Treasurer
Andrew Corporation
10500 W. 153rd Street
Orland Park, IL 60462

Dear Jeff,

    We are pleased to establish an unsecured line of credit in your favor in the amount of up to $10,000,000 (Ten million US dollars) or its equivalent, which shall continue from January 26, 2001 until January 25, 2002 unless you or we elect to terminate it earlier by advising the other.

    The line of credit will be subject to the following terms and conditions:

Borrower:	Andrew Corporation
Facility Amount:	Not to exceed in the aggregate $10,000,000 (Ten million US dollars) or the equivalent in other available currencies.
Currency:	You may obtain loans in U.S. dollars or any major currency which is freely convertible into U.S. dollars and is available when required in the London Interbank Eurocurrency Market. The U.S. dollar equivalent of such currency shall be in the U.S. dollar amount from time to time required to purchase the relevant amount of such currency as calculated by us at the arithmetic mean of our buying and selling rates of exchange in London.
Availability:	Fixed periods of up to one year in amounts, currencies and rates of interest to be agreed when a loan is requested. A borrowing request should be received not later than 10:00 a.m. (London time) on (i) the proposed borrowing date for loans in U.S. dollars or sterling and (ii) the day which is at least one London business day prior to the proposed borrowing date for loans in any other currency.
Termination:	Unless otherwise agreed in writing by the Bank's Lending Office, all loans must be repaid no later than the date set forth above.
Repayment:	Each loan shall be repayable forthwith upon our demand at any time. If no earlier demand has been made, each loan shall be repaid at the end of the period of such loan.
Interest:	Interest will be computed on the basis of actual days elapsed on a 360 day year basis in the case of U.S. dollars and other currencies and a 365 day year basis in the case of sterling or any other currency for which market practice so dictates. Any amounts which are not paid when due (whether of principal, interest or otherwise) shall bear interest until paid in full at a rate per annum equal to 3% in excess of the cost of funding such amounts calculated by reference to the applicable London Interbank Offered Rate (or any applicable successor rate) as conclusively certified by us.

Payments:	All amounts payable shall be paid in immediately available and freely transferable funds to us in the currency borrowed free and clear of any present or future taxes, duties, charges or withholdings and without any setoff, counterclaim or deduction whatsoever. If you are compelled by law to deduct any of the foregoing you will pay us such additional amount as makes the net amount received by us equal to the amount payable by you had there been no deduction or withholding. You authorize us to debit any account maintained by you with us for any payments due hereunder.
Conditions:	Prior to requesting any utilisation of the facility described in this letter you shall furnish to us the following: (a)  appropriate resolutions, and; (b)  financial statements, and other relevant documentation which we may request.
Undertakings:	While any amount is outstanding hereunder neither you nor any of your subsidiaries will (a) create or allow to subsist any debenture security pledge or other encumbrance over any asset present or future (other than a lien arising by operation of law or in the ordinary course of trading as now conducted) or (b) permit any of your or its liabilities to have the benefit of any guarantee indemnity bond or comfort letter unless the party giving the same gives a like commitment in respect of this facility.
Indemnity:	You will indemnify us against (a) any loss or expense that we incur as a result of (i) your failure to pay any sum when due, (ii) any loan being repaid otherwise than at the end of the period of the loan, (iii) our accepting instructions by facsimile in relation to any matter purported to be authorized on your behalf notwithstanding that the signature(s) of the person(s) signing such instructions appear only as facsimile copies and notwithstanding that any such instructions may be forged or unauthorized, or (iv) our accepting instructions by telephone in relation to any such matter from any period reasonably believed by us to be acting on your behalf; and (b) all legal and other costs and expenses and registration or other fees and value added tax thereon incurred by us in connection with the preparation of this letter and the Guarantee or the enforcement or preservation of our rights hereunder or thereunder on a full indemnity basis. We shall be entitled to rely on any instructions purported to be signed by any of your authorized representatives and you hereby waive all rights you may have to renounce forged or unauthorized instructions and we shall have no liability to you for acting on such instructions.
Administrative Fee:	A flat fee of $5,000 payable on acceptance of this facility.

Law: This letter and any credit extension that may be made by the Bank will be governed by English law and you submit to the non-exclusive jurisdiction of the High Court of Justice in England for purposes hereof.

This line of credit shall be effective when you have signed and returned to us a copy of this letter. THIS LINE OF CREDIT MAY BE TERMINATED BY YOU OR BY US AT ANY TIME EFFECTIVE UPON THE GIVING OF ADVICE TO THE OTHER PARTY AND IN THE SOLE DISCRETION OF THE PARTY ELECTING TO TERMINATE, PROVIDED, HOWEVER, THAT THE TERMS OF THIS LETTER SHALL CONTINUE TO APPLY TO ANY AMOUNTS OUTSTANDING AT THE TIME OF TERMINATION.

Yours faithfully,
For and on behalf of
Bank One, NA
London Branch

/s/ M.M. Stevenson

Accepted and agreed
For and on behalf of
Andrew Corporation
/s/ M.J. Gittelman
By: M. Jeffrey Gittelman
Title: Vice President and Treasurer
Date: January 19, 2001

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EXHIBIT 10