10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

For the quarterly period ended March 31, 2006

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	36-2092797
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
3 Westbrook Corporate Center, Suite 900 Westchester, Illinois	60154
(Address of principal executive offices)	(Zip Code)

(708) 236-6600

(Registrant’s telephone number, including area code)

(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 that 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 by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x                     Accelerated filer ¨                     Non-accelerated filer ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ¨                 No x

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

Common Stock, $.01 Par Value 159,629,113 shares as of May 8, 2006

INDEX

ANDREW CORPORATION

PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets— March 31, 2006 and September 30, 2005	3
	Consolidated Statements of Operations— Three and six months ended March 31, 2006 and 2005	4
	Consolidated Statements of Cash Flows— Six months ended March 31, 2006 and 2005	5
	Notes to Consolidated Financial Statements— March 31, 2006	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
Item 4.	Controls and Procedures	23
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	24
Item 1A.	Risk Factors	24
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 4.	Submission of Matters to a Vote of Security Holders	25
Item 6.	Exhibits	26
SIGNATURE		27

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PART I—FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ANDREW CORPORATION

CONSOLIDATED BALANCE SHEETS

(In thousands, except share amounts)

	March 31 2006			September 30 2005
	(UNAUDITED)
ASSETS
Current Assets
Cash and cash equivalents	$	154,938		$	188,780
Accounts receivable, less allowances (March 2006 - $9,711; September 2005 - $12,240)		477,742			471,097
Inventory		369,167			353,402
Other current assets		62,173			63,578
Total Current Assets		1,064,020			1,076,857
Other Assets
Goodwill		871,221			862,083
Intangible assets, less amortization		45,172			56,753
Other assets		94,438			83,772
Property, Plant and Equipment
Land and land improvements		22,185			21,693
Buildings		132,064			131,335
Equipment		547,088			533,317
Allowance for depreciation		(468,022	)		(454,783	)
		233,315			231,562
TOTAL ASSETS	$	2,308,166		$	2,311,027
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
Accounts payable		222,207			230,620
Accrued expenses and other liabilities		106,042			112,596
Compensation and related expenses		47,847			52,002
Restructuring		11,070			13,432
Notes payable and current portion of long-term debt		44,786			26,966
Total Current Liabilities		431,952			435,616
Deferred liabilities		49,876			49,255
Long-term debt, less current portion		268,258			275,604
SHAREHOLDERS’ EQUITY
Common stock (par value, $.01 a share: 400,000,000 shares authorized: 162,476,513 shares issued at March 31, 2006 and September 30, 2005, including treasury)		1,625			1,625
Additional paid-in capital		679,668			676,262
Accumulated other comprehensive income		19,375			19,720
Retained earnings		889,000			870,588
Treasury stock, common stock at cost (2,824,983 shares at March 31, 2006 and 1,557,030 shares at September 30, 2005)		(31,588	)		(17,643	)
Total Shareholders’ Equity		1,558,080			1,550,552
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	2,308,166		$	2,311,027

See Notes to Consolidated Financial Statements

3

ANDREW CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(In thousands, except per share amounts)

	Three Months Ended March 31						Six Months Ended March 31
	2006			2005			2006			2005
Sales	$	481,653		$	481,747		$	996,352		$	955,584
Cost of products sold		382,236			365,206			779,929			747,883
Gross Profit		99,417			116,541			216,423			207,701
Operating Expenses
Research and development		26,792			25,577			54,751			52,448
Sales and administrative		58,318			58,315			120,022			109,344
Intangible amortization		4,429			5,358			9,548			12,908
Restructuring		1,362			948			861			2,786
(Gain) loss on sale of assets		(72	)		(1,033	)		1,389			(1,033	)
		90,829			89,165			186,571			176,453
Operating Income		8,588			27,376			29,852			31,248
Other
Interest expense		4,139			3,516			7,908			7,224
Interest income		(1,351	)		(1,367	)		(2,232	)		(3,073	)
Other expense, net		687			324			533			1,840
		3,475			2,473			6,209			5,991
Income Before Income Taxes		5,113			24,903			23,643			25,257
Income taxes		1,544			9,551			5,231			6,927
Net Income		3,569			15,352			18,412			18,330
Preferred Stock Dividends		—			115			—			232
Net Income Available to Common Shareholders	$	3,569		$	15,237		$	18,412		$	18,098
Basic Net Income per Share	$	0.02		$	0.09		$	0.12		$	0.11
Diluted Net Income per Share	$	0.02		$	0.09		$	0.11		$	0.11
Average Shares Outstanding
Basic		159,530			161,264			159,873			161,094
Diluted		160,260			179,125			160,486			161,499

See Notes to Consolidated Financial Statements

4

ANDREW CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(In thousands)

	Six Months Ended March 31
	2006			2005
Cash Flows from Operations
Net Income	$	18,412		$	18,330
Adjustments to Net Income
Depreciation		28,192			29,671
Amortization		9,548			12,908
Restructuring costs		(2,130	)		(5,190	)
Loss on sale of assets and other		(100	)		(332	)
Stock based compensation		4,045			1,470
Change in Operating Assets and Liabilities
Accounts receivable		(3,694	)		(42,100	)
Inventory		(12,885	)		(6,267	)
Other assets		(6,118	)		(13,341	)
Accounts payable and other liabilities		(23,657	)		21,149
Net Cash From Operations		11,613			16,298
Investing Activities
Capital expenditures		(33,181	)		(32,468	)
Acquisition of businesses		(9,063	)		(19,204	)
Investments		(1,722	)		—
Proceeds from sale of businesses and investments		—			9,494
Proceeds from sale of property, plant and equipment		1,777			2,352
Net Cash Used for Investing Activities		(42,189	)		(39,826	)
Financing Activities
Long-term debt payments, net		(7,610	)		(9,466	)
Notes payable borrowings, net		17,839			9,064
Preferred stock dividends		—			(232	)
Payments to acquire common stock for treasury		(17,600	)		—
Stock purchase and option plans		3,019			669
Net Cash (Used for) From Financing Activities		(4,352	)		35
Effect of exchange rate changes on cash		1,086			6,544
Decrease for the Period		(33,842	)		(16,949	)
Cash and Equivalents at Beginning of Period		188,780			189,048
Cash and Equivalents at End of Period	$	154,938		$	172,099

See Notes to Consolidated Financial Statements

5

ANDREW CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. 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, 2006 are not necessarily indicative of the results that may be expected for the year ending September 30, 2006. 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, 2005.

Reclassifications

Certain previously reported amounts have been reclassified to conform to the current period presentation.

NOTE 2. EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share amounts):

	Three months ended March 31				Six months ended March 31
BASIC EARNINGS PER SHARE	2006		2005		2006		2005
Net income	$	3,569	$	15,352	$	18,412	$	18,330
Preferred stock dividends		—		115		—		232
Net income available to common shareholders	$	3,569	$	15,237	$	18,412	$	18,098
Average basic shares outstanding		159,530		161,264		159,873		161,094
Basic net income per share	$	0.02	$	0.09	$	0.12	$	0.11
	Three months ended March 31				Six months ended March 31
DILUTED EARNINGS PER SHARE	2006		2005		2006		2005
Net income	$	3,569	$	15,352	$	18,412	$	18,330
Preferred stock dividends		—		115		—		232
Net income available to common shareholders	$	3,569	$	15,237	$	18,412	$	18,098
Effect of dilutive securities:
Convertible bonds		—		1,308		—		—
Net income available to common shareholders after assumed conversions	$	3,569	$	16,545	$	18,412	$	18,098
Average basic shares outstanding		159,530		161,264		159,873		161,094
Effect of dilutive securities:
Convertible bonds		—		17,532		—		—
Options, warrants, and equivalents		730		329		613		405
Average diluted shares outstanding		160,260		179,125		160,486		161,499
Diluted net income per share	$	0.02	$	0.09	$	0.11	$	0.11

In the second quarter of 2005, the company converted 119,114 shares of convertible preferred stock into 1,372,906 shares of common stock. Under the if-converted method, these convertible preferred shares would have increased the diluted average shares outstanding by 1,144,090 for the second quarter of 2005 and by 1,258,489 for the six months ending March 31, 2005. These shares were not included in the calculation of diluted earnings per share because including these shares and excluding the convertible preferred stock dividends would have increased reported diluted earnings per share.

6

The company’s convertible subordinated notes are potentially convertible into 17,531,568 shares of the company’s common stock. Except for the quarter ended March 31, 2005, these shares were not included in the calculation of diluted earnings per share because including these shares and excluding the interest expense on these notes would have increased reported diluted earnings per share.

Options and warrants to purchase 6,579,133 and 7,931,743 shares of common stock, at March 31, 2006 and 2005, respectively, were not included in the computation of diluted shares because the options’ exercise prices were greater than the average market price of the company’s common stock.

NOTE 3. INVENTORIES

Inventories consisted of the following at March 31, 2006 and September 30, 2005, net of reserves:

(In thousands)	March 31 2006		September 30 2005
Raw materials	$	117,016	$	97,781
Work in process		90,385		93,917
Finished goods		161,766		161,704
	$	369,167	$	353,402

NOTE 4. COMPREHENSIVE INCOME

For the three and six month periods ended March 31, 2006 and 2005, comprehensive income consisted of net income available to common shareholders and foreign currency translation adjustments. Foreign currency translation adjustments are recorded in Accumulated Other Comprehensive Income, a component of shareholders’ equity. In the first quarter of fiscal 2006, the company recognized a $1.5 million gain for foreign currency translation adjustments related to the liquidation of an investment in a foreign subsidiary. The following table sets forth comprehensive income for the three and six month periods ended March 31, 2006 and 2005:

	Three months ended March 31					Six months ended March 31
(In thousands)	2006		2005			2006			2005
Net income	$	3,569	$	15,237		$	18,412		$	18,098
Foreign currency translation adjustments		10,298		(16,518	)		(345	)		21,525
Comprehensive Income (Loss)	$	13,867	$	(1,281	)	$	18,067		$	39,623

NOTE 5. RECENTLY ISSUED ACCOUNTING POLICIES

In May 2005, the Financial Accounting Standards Board (FASB) issued revised Statement of Financial Accounting Standards (SFAS) No. 154, “Accounting Changes and Error Corrections,” a replacement of APB Opinion No. 20 and FASB Statement No. 3. This statement applies to all voluntary changes in accounting principle, and requires retrospective application to prior periods’ financial statements for changes in accounting principle. SFAS No. 154 will be effective for the Company beginning in fiscal year 2007.

In October 2005, the FASB issued Staff Position (“FSP”) 13-1, “Accounting for Rental Costs Incurred during a Construction Period.” The guidance requires that the rental costs for ground or building operating leases during the construction period be recognized as rental expenses. The guidance permits either retroactive or prospective treatment for fiscal years beginning after December 15, 2005. The company is currently evaluating the impact of this FSP.

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NOTE 6. ADOPTION OF NEW ACCOUNTING POLICIES

In January 2005, the FASB issued revised Statement of Financial Accounting Standards (SFAS) No. 151, “Inventory Costs,” an amendment of ARB No. 43. The amendments made by SFAS 151 clarify that abnormal amounts of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be recognized as current-period charges and require the allocation of fixed production overheads to inventory based on the normal capacity of the production facilities. The company adopted SFAS 151 starting in fiscal year 2006. The adoption of SFAS 151 did not have a material impact on the company’s results of operations.

In March 2005, the FASB issued Interpretation No. 47, “Accounting for Conditional Asset Retirement Obligations” (FIN No. 47), an interpretation of FASB No. 143. This Interpretation clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. The company adopted Interpretation No. 47 starting in fiscal year 2006. The adoption of FIN No. 47 did not have a material impact on the company’s results of operations.

Starting in fiscal 2006 the company has adopted SFAS No. 123(R), “Share Based Payments,” as described in Note 7.

NOTE 7. STOCK BASED COMPENSATION

In the first quarter of fiscal 2006, the company adopted Statement of Financial Accounting Standards (SFAS) No. 123(R), “Share Based Payments,” which revises SFAS No. 123, “Accounting for Stock Based Compensation.” SFAS No. 123(R) requires the company to record compensation expense for all share-based payments, including employee stock options, at fair value. Prior to fiscal 2006, the company had accounted for its stock-based compensation awards pursuant to Accounting Principles Board Opinion (APB) No. 25, “Accounting for Stock Issued to Employees,” and its related interpretations, which allowed the use of the intrinsic value method. Under the intrinsic value method, compensation expense for stock option-based employee compensation was not recognized in the income statement as all stock options granted by the company had an exercise price equal to the market value of the underlying common stock on the option grant date.

The company has elected to use the modified prospective transition method to adopt SFAS No. 123(R). Under this transition method starting in 2006, compensation expense recognized includes: (a) expense for all share-based payments granted prior to, but not yet vested as of October 1, 2005, based on the grant date fair value estimated in accordance with the original provisions of SFAS No. 123, and (b) expense for all share-based payments granted subsequent to October 1, 2005, based on the grant-date fair value estimated in accordance with the provisions of SFAS No. 123(R). As required under the modified prospective transition method the company has not restated prior period results. As a result, certain components of the company’s quarterly financial statements will not be comparable until the first quarter of fiscal 2007, the anniversary of the adoption of SFAS No. 123(R).

The company maintains long-term management incentive plans (LTIPs) which provide for the issuance of equity-based awards including stock options, which vest over a four to five year period. Prior to fiscal 2006, the company used the intrinsic value method to value all stock options issued under these plans and therefore recorded no compensation expenses for these stock options. At the start of fiscal 2006, the company had approximately 1.0 million unvested stock options outstanding under its LTIPs. Beginning in fiscal 2006, the company has recognized compensation expense ratably over the remaining vesting period of these options. The fair value of these options was calculated using the Black-Scholes option-pricing model using the original provisions of SFAS No. 123. In the first and second quarters of fiscal 2006, the company recognized pre-tax compensation expense of $0.9 million and $0.8 million, respectively, and anticipates that it will recognize expense of $3.2 million for these options in fiscal 2006.

During the first six months of fiscal 2006, the company has granted 463,900 stock options under its LTIPs. The company has elected to value these options using the Black-Scholes option-pricing model and has determined that the weighted average fair value of these options is $5.29 per option. Based on this valuation, the company recorded $0.1 million of pre-tax compensation expense in both the first and second quarter of fiscal 2006 and anticipates that it will recognize $0.5 million of expense for these options in fiscal year 2006. Total pre-tax cost recognized in the first and second quarters of fiscal 2006 for all stock options was $1.0 million and $0.9 million, respectively, and a reduction to net income of $0.6 million and $0.5 million, respectively, or $0.00 per share per quarter and $0.01 per share for the six months ended March 31, 2006. The company estimates that for fiscal 2006 the company will recognize $3.8 million, on a pre-tax basis, of compensation expense for all stock options, an estimated reduction to net income of $2.4 million or approximately $0.02 per share. As of March 31, 2006, unrecognized compensation expense related to the unvested portion of the company’s stock options was approximately $7.1 million.

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The fair value of each unvested option was estimated based on the date of grant using the Black-Scholes option valuation model with the following assumptions:

	2006		2005		2004		2003
Risk free interest rate	4.42	%	4.25	%	4.00	%	3.98	%
Expected life	5.5 years		6.0 years		6.0 years		6.0 years
Expected volatility	50	%	66	%	61	%	58	%
Dividend yield	0	%	0	%	0	%	0	%
Estimated forfeitures	10	%	NA		NA		NA

The risk free interest rate was based on U.S. Treasury yields with a remaining term that approximates the expected life of the options granted. The expected life used for options granted in 2006 was based on historical data of employee exercise performance. Prior to fiscal 2006, the expected life was based on the average life of outstanding options. The estimated volatility for fiscal 2006 was based both on the company’s historical stock price volatility and the market-implied volatility from traded options. Prior to fiscal 2006, the company calculated volatility based only on historical stock price volatility. The company used an expected dividend yield of 0% for all periods because the company has never paid and does not anticipate paying dividends in the foreseeable future. Starting in fiscal 2006, the company has used an estimated forfeiture rate of 10% based on historical data. Prior to 2006, the company used the actual forfeiture method allowed under SFAS 123 which assumed that all options would vest and pro forma expense was adjusted when options were forfeited.

The following table illustrates the pro forma effect on net income and earnings per share if the company had applied the fair value recognition provisions of SFAS 123 to stock options for the three and six months ended March 31, 2005:

(In thousands, except per share amounts)	Three months ended March 31 2005			Six months ended March 31 2005
Reported net income	$	15,352		$	18,330
Preferred stock dividends		(115	)		(232	)
Reported net income available to common shareholders		15,237			18,098
Less: stock-based compensation, net of tax		(486	)		(9,638	)
Pro forma net income available to common shareholders	$	14,751		$	8,460
Reported basic and diluted net income per share	$	0.09		$	0.11
Pro forma basic and diluted net income per share	$	0.09		$	0.05

In the first quarter of fiscal 2005, the company granted 1.5 million stock options that vested immediately and included a restriction on the resale of the underlying shares of common stock. For pro forma disclosure purposes, these options were treated as if they were expensed in the first quarter of 2005, increasing pro forma expense net of tax by approximately $8.4 million.

A summary of the company’s stock option activity and related information follows for the six months ended March 31, 2006:

	Summary of Option Activity		Weighted Average Exercise Price
Outstanding at September 30, 2005	8,535,804		$	17.41
Granted	463,900			10.14
Expired or cancelled	(467,871	)		20.97
Exercised	(244,881	)		9.68
Outstanding at March 31, 2006	8,286,952			16.98
Exercisable at March 31, 2006	7,197,288		$	17.93

The weighted average fair value of options granted during fiscal years 2005, 2004, and 2003, was $8.88, $7.07, and $4.42, per share, respectively. During the first six months of fiscal 2006, the company granted 463,900 stock options with a weighted average fair value of $5.29.

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The range of exercise prices for options outstanding and exercisable at March 31, 2006 was $8.91 to $38.17.

Range of Exercise Prices	$8.91 - $10.27		$11.09 - $12.91		$13.03 - $16.94		$17.11 - $18.65		$19.12 - $22.19		$22.65 - $24.94		$27.19 - $38.17		Total
Outstanding Options		1,209,233		1,576,936		1,919,425		736,778		808,680		1,669,975		365,925		8,286,952
Weighted Average
Exercise Price	$	9.71	$	11.44	$	14.84	$	17.63	$	21.86	$	23.16	$	36.23	$	16.98
Average Life		7.71		7.54		7.51		3.79		5.79		3.75		0.66		5.97
Exercisable Options		728,156		968,349		1,919,425		736,778		808,680		1,669,975		365,925		7,197,288
Weighted Average
Exercise Price	$	9.45	$	11.50	$	14.84	$	17.63	$	21.86	$	23.16	$	36.23	$	17.93

SFAS No 123(R) also requires the benefits of tax deductions in excess of recognized compensation cost be reported as a financing cash flow rather than as an operating cash flow as required under SFAS No. 123. This requirement will reduce net operating cash flows and increase net financing cash flows in periods after adoption. The impact of this change was $0.6 million for the first six months of fiscal 2006. Operating cash flows recognized in fiscal 2005 for such excess tax deductions were approximately $0.1 million.

As part of the company’s LTIPs it has also granted deferred and restricted stock units (RSUs) to officers, key employees and directors. Each RSU entitles the participant to one share of the company’s common stock on the vesting date. In order to calculate compensation expense, SFAS No. 123(R) requires expense to be adjusted for an estimated forfeiture factor, with the company utilizing a forfeiture rate of 10% based upon historical forfeiture rates. Compensation expense for RSUs is recognized on a straight-line basis over the vesting period and is based on the market price of the company’s common stock on the grant date. RSUs generally vest based on service periods ranging from three to four years. In fiscal 2006, the company granted RSUs that vest based on the company achieving a target return on invested capital (ROIC) goal in fiscal 2008. The number of RSUs that vest will range from 0% to 125% of the grant based on the ROIC in fiscal 2008. In determining compensation expense, the company assumes that the ROIC target of 100% of the grant will be achieved; the company evaluates this assumption periodically. The fair value of these RSUs was based on the company’s common stock price at the date of grant. The company recognized pre-tax compensation expense for RSUs of $1.1 million for each of the first and second quarter of fiscal 2006, and $0.3 million and $1.2 million in the first and second quarters of fiscal 2005, respectively.

The table below shows the company’s outstanding RSUs at March 31, 2006:

Grant Year	RSU’s Granted	Vesting Period	Weighted Average Fair Value		Unearned Compensation Expense at March 31, 2006 (in thousands)
2004	298,800	3 years	$	12.04	$	882
2005	412,350	4 years	$	13.38		3,746
2006	76,300	4 years	$	12.32		877
2006	696,129	performance based	$	10.21		6,092
TOTAL	1,483,579				$	11,597

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NOTE 8. RESTRUCTURING AND INTEGRATION

At March 31, 2006, the company’s total restructuring reserve balance was $11.1 million, which is comprised of $1.9 million for its 2002 restructuring plan, $4.0 million for its Allen Telecom acquisition integration plan and $5.2 million for the integration plan for Channel Master.

Restructuring Reserve

In 2002, the company initiated a plan to restructure its operations. As part of this plan the company consolidated its operations into fewer, more efficient facilities and opened two new manufacturing facilities in Mexico and the Czech Republic. In 2002, when the company initiated its restructuring efforts, it incurred pre-tax charges of $36.0 million, consisting of inventory provisions of $11.1 million, charged to cost of products sold, and an operating expense charge of $24.9 million. In 2003 and 2004, the company made additional accruals to operating expense of $7.9 million and $7.5 million, respectively, primarily for additional severance and lease cancellation costs. The remaining reserve balance at March 31, 2006 of $1.9 million relates to a leased facility previously used by the Base Station Subsystems operating segment, for lease cancellation costs that are scheduled to continue through 2007.

Since the start of this restructuring initiative in 2002, the company has paid severance costs of $17.3 million to 1,226 employees and $10.6 million for lease cancellation and other costs. During the first quarter of fiscal 2006, the company reversed $0.7 million from the restructuring reserve as the company terminated a portion of the lease obligation. Additionally, in the first six months of fiscal 2006, the company incurred cash costs of $1.2 million for lease payments, lease termination costs and facility exit costs.

A summary of the restructuring reserve activity for the first half of fiscal 2006 is as follows (in thousands):

Restructuring Reserve Activity for the six months ended March 31, 2006	Reserve Balance Sept. 30, 2005		Utilization of Reserve		Reversal of Accrual		Reserve Balance Mar. 31, 2006
Lease Cancellation Expense and Total Restructuring Reserve	$	3,966	($1,378	)	($707	)	$	1,881

Allen Telecom Acquisition Integration Reserve

As part of the Allen Telecom acquisition in 2003, the company accrued an integration reserve for costs to integrate Allen’s operations with those of the company and to eliminate duplicate operations. The initial cost estimate of $29.9 million was comprised of a $16.2 million provision for inventory and fixed asset write-offs and a restructuring reserve of $13.7 million for employee termination, lease cancellation and other costs. During 2004, the company adjusted this initial estimate and recorded an additional $13.6 million of reserves consisting of $14.1 million of additional employee termination, lease cancellation and other costs, and a $0.5 million reduction in expected inventory write-offs. In fiscal 2005, the company reversed a reserve for a French facility that the company decided not to close. This resulted in the company reversing $2.7 million in severance and $0.9 million of lease cancellation and other costs that had been accrued for closing this facility. Integration reserves established in purchase accounting were accounted for as a decrease in assets acquired and an increase in liabilities assumed from Allen Telecom.

Since the start of these integration efforts in 2003, the company has paid severance costs of $14.4 million to 407 employees and $9.4 million for lease cancellation and other costs. During the first six months of fiscal 2006 the company paid $0.1 million of severance costs for two employees and $0.2 million in lease payments. The company anticipates paying severance benefits to approximately 35 employees and expects to substantially complete its integration activities in 2006. The reserve balance at March 31, 2006 of $4.0 million primarily relates to the Base Station Subsystems business.

A summary of integration reserve activity for the second quarter of fiscal 2006 is as follows (in thousands):

Allen Integration Reserve Activity for the six months ended March 31, 2006	Reserve Balance Sept. 30, 2005		Utilization Of Reserve		Reserve Balance Mar. 31, 2006
Severance	$	1,426	($66	)	$	1,360
Lease cancellation and other costs		2,868	(210	)		2,658
Total Integration Reserve	$	4,294	($276	)	$	4,018

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Channel Master Integration Reserve

As part of the Channel Master acquisition, the company accrued an integration reserve for costs to restructure Channel Master’s U.S. manufacturing operations. The initial cost estimate of $5.2 million was comprised of a $2.9 million provision for relocation and restructuring of manufacturing operations and a $2.3 million provision to pay severance benefits to approximately 245 manufacturing employees. The $5.2 million was treated as a purchase accounting adjustment and was recorded as an increase in the value of net assets acquired. Channel Master’s operations are included in the Satellite Communications segment.

The company expects to substantially complete its Channel Master integration activities in 2007. A summary of integration reserve activity for the first six months of fiscal 2006 is as follows (in thousands):

Channel Master Reserve Activity for the six months ended March 31, 2006	Reserve Balance Sept. 30, 2005		Utilization Of Reserve		Reserve Balance Mar. 31, 2006
Severance	$	2,293	$	0	$	2,293
Facility relocation and other costs		2,879		0		2,879
Total Channel Master Reserve	$	5,172	$	0	$	5,172

NOTE 9. CONTINGENCIES

Warranty Reserve

The company offers warranties on most of its products. The specific terms and conditions of the warranties offered by the company vary depending upon the product sold. The company estimates the costs that may be incurred under its warranty plans and records a liability in the amount of such estimated costs at the time product revenue is recognized. Factors that affect the company’s warranty liability include the number of units sold, the type of products sold, historical and anticipated rates of warranty claims and cost per claim. The company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. The company reports warranty reserves as a current liability included in accrued expenses and other liabilities.

In fiscal 2005, the company incurred $16.6 million of costs above normal warranty provisions associated with abnormally high field failure rates for a specific component supplied by third-parties used in certain base station subsystem product lines. This $16.6 million was comprised of a first quarter 2005 charge of $19.8 million and a fourth quarter recovery from third parties of $3.2 million. The company anticipates that the repair and replacement of installed units will be completed over the next 6 months. The company paid $3.8 million in the second quarter and $7.6 million for the first six months of fiscal 2006 for this component failure, which is included in warranty settlements in the table below. Changes in the company’s warranty reserve during the three and six month periods ended March 31, 2006 and 2005 are as follows:

	Three months ended March 31						Six months ended March 31
(In thousands)	2006			2005			2006			2005
Warranty reserve at beginning of period	$	25,482		$	40,022		$	26,754		$	18,900
Accrual for warranties issued		4,364			4,484			9,509			8,546
Warranty settlements made		(6,822	)		(2,834	)		(12,783	)		(5,748	)
Warranty expirations and adjustments		(1,711	)		(415	)		(2,167	)		(241	)
Product recall		—			—			—			19,800
Warranty reserve at end of period	$	21,313		$	41,257		$	21,313		$	41,257

Legal Proceedings

On October 25, 2005, TruePosition, Inc. filed a complaint in the U.S. District Court for the District of Delaware, alleging the company’s potential sale of certain geolocation products to Saudi Telecom will infringe a TruePosition patent. As relief, the complaint seeks, among other things, injunctive relief and unspecified monetary damages. The company filed its answer and counterclaim on December 15, 2005 and intends to defend this litigation vigorously.

The company is also a party to various other legal proceedings, lawsuits and other claims arising in the ordinary course of its business. The company does not believe that such other litigation, if adversely determined, would have a material effect on the company’s business, financial position, results of operations or cash flow.

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NOTE 10. BUSINESS ACQUISITIONS

In February of 2006, the company acquired Skyware Radio Systems GmbH (Skyware), a German manufacturer of electronic products for broadband satellite communications networks for approximately $8.7 million in cash. The Skyware acquisition agreement includes an earn-out provision, which could result in additional purchase consideration of up to $6.0 million if certain financial targets are met over a two-year period. A preliminary allocation of the purchase price resulted in $7.2 million of goodwill. The company has not completed its allocation of assets acquired and has not yet assigned any of the purchase price to intangible assets. The company anticipates completing its purchase price allocation by the end of the fiscal year. Pro forma results of operations, assuming this acquisition occurred at the beginning of the fiscal year, were not materially different from the reported results of operations.

After the close of the second quarter of fiscal 2006, the company completed two acquisitions. On April 13, 2006, the company acquired Precision Antennas Ltd. (Precision), a Stratford, England-based designer and manufacturer of microwave antennas for use in carrying point-to-point radio signals, primarily for cellular network back haul applications. The company paid approximately $26 million (15 million GBP) in cash to acquire Precision.

On April 25, 2006, the company acquired Cell Site Industries (CSI), a privately-held provider of wireless equipment repair services based in Milpitas, California for approximately $6.2 million in cash. The CSI acquisition agreement includes an earn-out provision which could result in additional purchase consideration of up to $14.0 million if certain financial targets are met over a three-year period.

NOTE 11. SALE OF ASSETS

In the first six months of 2006, the company recorded a loss on the sale of assets of $1.4 million. The loss on the sale of assets primarily includes a $2.0 million first quarter charge to write down to fair value certain assets that the company anticipates selling by the end of fiscal 2006. These assets consist of intangible assets of $1.5 million and $0.5 million of inventory and fixed assets. In the first quarter of fiscal 2006 the company also recognized a gain of approximately $0.8 million on the sale of assets, principally from the sale of unimproved land in Denton, Texas.

NOTE 12. DEBT COVENANTS

Under the terms of the company’s $250 million revolving credit facility, the company is subject to various quarterly requirements, including maintaining a ratio of earnings before interest, taxes, depreciation and amortization (EBITDA) to total debt, including letters of credit, maintaining a ratio of EBITDA to senior debt, maintaining a fixed charge coverage ratio and limiting the amount of assets that the company can dispose of in a fiscal year. These requirements may limit the amount of borrowing under this credit agreement. The company was in compliance with all of these requirements as of March 31, 2006. At March 31, 2006, under the most restrictive of these requirements the company had the ability to utilize $233 million of the credit facility.

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NOTE 13. BENEFIT PLANS

The company has two defined benefit plans, one that covers approximately 650 current and former employees of the company’s United Kingdom subsidiary and a frozen plan that was acquired from Allen Telecom that covers approximately 1,600 former employees of Allen Telecom.

The components of net periodic expense for these plans, as well as the company’s post-retirement medical and life insurance plans, for the three and six months ended March 31, 2006 and 2005 are as follows:

	Pension Benefits
	Three months ended March 31						Six months ended March 31
(In thousands)	2006			2005			2006			2005
Service costs	$	453		$	502		$	900		$	1,006
Interest costs		1,723			1,596			3,433			3,195
Expected return on plan assets		(1,392	)		(1,435	)		(2,772	)		(2,827	)
Amortization of unrecognized prior service costs		80			87			159			175
Amortization of net loss		(37	)		203			(76	)		407
Net periodic expense	$	827		$	953		$	1,644		$	1,956
	Medical Plans and Other Benefits
	Three months ended March 31						Six months ended March 31
(In thousands)	2006			2005			2006			2005
Service costs	$	102		$	50		$	204		$	100
Interest costs		243			179			486			352
Amortization of unrecognized prior service costs		(135	)		(135	)		(270	)		(270	)
Amortization of net loss		337			158			674			316
Net periodic expense	$	547		$	252		$	1,094		$	498

In fiscal 2005 the company initiated the process of terminating the frozen defined benefit plan assumed as part of the Allen Telecom acquisition. The company estimates that it will make additional contributions of up to $10 million by the end of fiscal 2006 to fully fund and terminate this plan based on current actuarial projections.

NOTE 14. INCOME TAXES

The reported tax rate was 30.2% for the second quarter and 22.1% for the first six months of fiscal 2006. The reported tax rate reflects underlying effective tax rates on operations of 43.8% and 33.0%, respectively. The reported tax rates for both reporting periods of fiscal 2006 reflect discrete non-recurring tax adjustments, primarily tax benefits related to the repatriation of foreign earnings. During the quarter, the effective tax rate on operations increased due to an unfavorable geographic mix shift of earnings coupled with a decrease in pretax income in the second quarter of fiscal 2006 compared to the first quarter.

The reported tax rate was 38.4% for the second quarter and 27.4% for the first six months of fiscal 2005, reflecting underlying effective tax rates on operations of 46.5% and 39.6%, respectively. The reported tax rates for both fiscal 2005 reporting periods reflect non-recurring tax benefits related to favorable resolution of certain tax-related matters with government authorities. The underlying effective tax rate on operations for the fiscal 2006 reporting periods decreased from the effective tax rates in the prior year reporting periods primarily due to the permanent reinvestment of earnings in China during fiscal 2006 and a favorable geographic mix shift of earnings. In addition, the reported tax rate for the second quarter of fiscal 2006 benefitted from non-recurring tax adjustments, primarily tax benefits related to the repatriation of foreign earnings as compared to the reported tax rate for the second quarter of fiscal 2005.

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As of March 31, 2006, the company had a net deferred tax asset of approximately $71.6 million, primarily attributable to U.S. net operating losses carried forward, which will begin to expire in 2021. Recoverability of this deferred tax asset is dependent upon the company’s ability to generate future taxable profits in the United States. The company continuously reviews and assesses the recoverability of its deferred tax asset and it is the company’s current opinion that the net deferred tax asset is fully recoverable. Should the company subsequently determine it is more likely than not that this deferred tax asset will not be realized, the company would be required to record a non-cash charge to establish a valuation allowance against some portion or all of the deferred tax asset at that time. Establishing a valuation allowance could have a material adverse impact upon the company’s effective tax rate and reported financial results.

NOTE 15. SEGMENTS

The company manages its business in five operating segments: Antenna and Cable Products, Base Station Subsystems, Network Solutions, Wireless Innovations and Satellite Communications.

Antenna and Cable Products includes a diverse product offering for the wireless infrastructure market including base station antennas, coaxial cable and connectors and microwave antennas. Base Station Subsystems products are integral components of wireless base stations and include products such as power amplifiers, filters, duplexers and combiners. Network Solutions includes geolocation products, network optimization analysis systems, and engineering and consulting services. Wireless Innovations products are used to extend and enhance the coverage of wireless networks in areas where signals are difficult to send or receive such as tunnels, subways, airports and other coverage gaps. Satellite Communications is comprised of the following product lines: direct-to-home (DTH) satellite antennas, earth station antennas and systems (ESA) and high frequency (HF) / radar products. The company evaluates the performance of these segments based on sales and operating income (loss). The following table shows sales and operating income (loss) by segment for the three and six months ended March 31, 2006 and 2005.

	Three months ended March 31						Six months ended March 31
(In thousands)	2006			2005			2006			2005
Sales
Antenna and Cable Products	$	265,7111		$	242,5752		$	556,6553		$	474,3374
Base Station Subsystems		119,409			115,962			242,863			233,110
Network Solutions		26,816			43,923			49,236			78,695
Wireless Innovations		38,396			44,964			87,214			86,216
Satellite Communications		31,321			34,323			60,384			83,226
Total Consolidated Sales	$	481,653		$	481,747		$	996,352		$	955,584
Operating Income (Loss)
Antenna and Cable Products	$	28,7931		$	37,0472		$	72,2833		$	75,4584
Base Station Subsystems		3,116			(586	)		5,967			(24,716	)
Network Solutions		5,676			17,830			7,868			33,960
Wireless Innovations		6,385			11,272			15,741			18,179
Satellite Communications		(4,093	)		(2,854	)		(6,694	)		(3,895	)
Items not included in segments
Unallocated Sales and Administrative Costs		(26,932	)		(31,008	)		(54,376	)		(55,863	)
Intangible Amortization		(4,429	)		(5,358	)		(9,548	)		(12,908	)
Gain (Loss) on the Sale of Assets		72			1,033			(1,389	)		1,033
Total Consolidated Operating Income	$	8,588		$	27,376		$	29,852		$	31,248

¹ Includes distribution service and freight revenue of $6,652 and operating income of $1,103.

² Includes distribution service and freight revenue of $4,662 and operating income of $833.

³ Includes distribution service and freight revenue of $19,597 and operating income of $2,523.

⁴ Includes distribution service and freight revenue of $11,909 and operating income of $1,651.

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

The following discussion and analysis should be read in conjunction with the consolidated financial statements and accompanying notes contained herein and the consolidated financial statements and accompanying notes and management’s discussion and analysis of results of operations and financial condition contained in the company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2005. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including but not limited to those described below under the heading “Cautionary Statement regarding Forward-Looking Statements.”

Overview

Andrew Corporation, together with its subsidiaries, is engaged in the design, manufacture, and supply of communications equipment, services, and systems for global communications infrastructure markets. The company’s products are used in the infrastructure for traditional wireless networks, third generation (3G) technologies, voice, data, video and internet services, as well as applications for microwave and satellite communications, and other specialized applications. The company operates in five segments: Antenna and Cable Products, Base Station Subsystems, Network Solutions, Wireless Innovations, and Satellite Communications. With the exception of Satellite Communications, all of Andrew’s operating segments sell products and services to the wireless infrastructure market.

The company’s financial results are influenced by factors in the markets in which it operates and by its ability to successfully execute its business strategy. Marketplace factors include competition for customers, raw material prices, product and price competition, economic conditions in various geographic regions, foreign currency exchange rates, interest rates, changes in technology, fluctuations in customer demand, patent and intellectual property issues, litigation results and legal and regulatory developments. The company expects that the marketplace environment will remain highly competitive. Andrew’s ability to execute its business strategy successfully will require that we meet a number of challenges, including our ability to accurately forecast sales demand and calibrate manufacturing to such demand, develop, manufacture and successfully market new and enhanced products and product lines, control overhead spending, successfully integrate acquired businesses, and attract, motivate and retain key personnel to manage its operational, financial and management information systems.

Highlights

Sales for the quarter ended March 31, 2006 were $482 million, unchanged from the second quarter of fiscal 2005. Revenue growth in Antenna and Cable Products and Base Station Subsystems was offset primarily by a decline in E-911 geolocation equipment sales and a decrease in sales due to exchange rates as a result of a stronger U.S. dollar compared to the prior fiscal year. Wireless infrastructure sales, excluding a decline in E-911 geolocation equipment sales, grew 5% versus the second quarter of fiscal 2005 due to growth for products supporting global wireless network upgrades and expansion. During the second quarter of fiscal 2006, sales were weaker than expected in January and February, although sales and order activity increased significantly in March. Orders in the second quarter of fiscal 2006 were a record $549 million and backlog grew sequentially to $303 million at March 31, 2006.

Sales for the six months ended March 31, 2006 were $996 million, a 4% increase over the first six months of fiscal 2005, primarily due to Antenna and Cable Products growth offset by anticipated lower E-911 geolocation equipment revenues and lower Satellite Communications revenues.

The gross margin for the second quarter of fiscal 2006 was 20.6%, down from 24.2% in the second quarter of fiscal 2005. Gross profit margins declined in fiscal 2006 due to higher commodity costs, principally copper, and a decline in higher margin E-911 geolocation equipment sales.

Gross margin was 21.7% for the first six months of both fiscal 2006 and fiscal 2005. The first six months of fiscal 2005 included a $19.8 million warranty provision for a component used in certain Base Station Subsystem products, resulting in a 207 basis point decline in the fiscal 2005 gross margin rate. Excluding this $19.8 million charge, the year-to-year gross margin decline was primarily due to lower Antenna and Cable Products margins, which were heavily affected by higher copper costs, and lower Network Solutions sales of higher margin E-911 geolocation equipment.

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Net income was $3.6 million for the second quarter of fiscal 2006, compared to $15.2 million in the second quarter of fiscal 2005. This decrease was primarily due to lower gross margins. Net income was $18.4 million for the first six months of fiscal 2006, compared to $18.1 million in the first six months of fiscal 2005. Net income for the first six months of fiscal 2005 was reduced by $12.2 million as a result of the $19.8 million pre-tax warranty provision recorded in the first quarter of fiscal 2005 for a defective component used in certain Base Station Subsystems products.

RESULTS OF OPERATIONS

Sales. Sales for the second quarter of fiscal 2006 were $482 million, unchanged from the second quarter of fiscal 2005. For the first six months of fiscal 2006 sales were $996 million, a 4% increase over fiscal 2005, due primarily to higher wireless infrastructure sales in fiscal 2006. Andrew’s sales by operating segment for the three and six months ended March 31, 2006 and 2005 were as follows:

	Three Months Ended March 31				% Change		Six Months Ended March 31				% Change
In millions	2006		2005				2006		2005
Sales
Antenna and Cable Products	$	266	$	243	10	%	$	557	$	475	17	%
Base Station Subsystems		120		116	3	%		243		233	4	%
Network Solutions		27		44	(39	%)		49		79	(37	%)
Wireless Innovations		38		45	(16	%)		87		86	1	%
Satellite Communications		31		34	(9	%)		60		83	(27	%)
Total Sales	$	482	$	482	0	%	$	996	$	956	4	%

Antenna and Cable Products sales increased in the second quarter and first six months of fiscal 2006 compared to fiscal 2005 due mainly to growth in base station antennas, radio frequency (RF) cable supporting network expansion and coverage requirements, and field services. Base station antenna sales increased by $4.8 million in the second quarter of fiscal 2006 and $17.3 in the first six months of fiscal 2006, versus fiscal 2005, due to strong growth in India and sales of new products such as Andrew’s Teletilt^® antenna systems. The company’s field service revenue increased $5.4 million in the second quarter versus the year ago quarter. Additionally, field services increased $19.1 million in the first half of 2006 versus the prior year as a result of the December 2004 acquisition of ATC Tower Services.

Base Station Subsystems sales increased 3% in the second quarter of fiscal 2006, versus the second quarter of fiscal 2005 due mainly to an increase in direct-to-operator sales in North America, partially offset by lower overall sales in Europe. In the first six months of fiscal 2006, Base Station Subsystems sales increased 4% compared to the prior year due to stronger filter sales resulting from new product introductions in North America, partially offset by lower overall sales in Europe and South America.

Network Solutions sales declined 39% in the second quarter and 37% in the first six months of fiscal 2006 due to a decline in E-911 geolocation equipment sales. Network Solutions sales have been driven by E-911 regulatory requirements in North America, where sales have declined as major market operators have completed upgrading their networks to meet these E-911 requirements.

In the second quarter of fiscal 2006, Wireless Innovations sales declined 16% due mainly to the timing of several large projects for distributed coverage solutions and a 5% unfavorable impact from a stronger dollar versus the euro. In the first six months of fiscal 2006, Wireless Innovations sales increased due to strong first quarter sales driven by the completion of several large projects in North America and Europe.

Satellite Communications sales declined 9% in the second quarter of fiscal 2006 as compared to the prior year quarter due to lower earth station and high frequency antenna revenues and the elimination of mobile antenna business sales. For the first six months of fiscal 2006, revenue decreased 27% primarily due to the company’s planned reduction of involvement in certain consumer broadband satellite programs.

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Andrew’s sales by region for the three and six months ended March 31, 2006 and 2005 were as follows:

	Three Months Ended March 31				% Change		Six Months Ended March 31				% Change
In millions	2006		2005				2006		2005
Sales
Americas	$	264	$	256	3	%	$	560	$	511	10	%
Europe, Middle East, Africa (EMEA)		155		165	(6	%)		308		323	(5	%)
Asia Pacific		63		61	3	%		128		122	5	%
Total	$	482	$	482	0	%	$	996	$	956	4	%

In the second quarter of fiscal 2006, sales in the Americas increased 3% versus the prior year quarter due mainly to growth in North America for Antenna and Cable Products and Base Station Subsystems supporting network upgrades and expansion, partially offset by lower sales of E-911 geolocation equipment and Satellite Communications products. In the first six months of fiscal 2006, sales in the Americas increased 10% due to strong Antenna and Cable Products, Base Station Subsystems and Wireless Innovations sales supporting network upgrades and expansion, partially offset by lower sales of E-911 geolocation equipment and consumer broadband satellite products.

EMEA sales declined 6% for the second quarter and 5% for the first six months of fiscal 2006, compared to the prior year. The EMEA decline was due principally to unfavorable foreign currency exchange rates relating to a stronger dollar versus the euro and lower Base Station Subsystem sales offset by higher Antenna and Cable Products revenue in Europe. Asia Pacific sales increased 3% in the second quarter and 5% for the first six months of fiscal 2006 due principally to increased demand in India and Taiwan for Antenna and Cable Products supporting network expansions offset by lower Wireless Innovations revenue.

The top 25 customers represented 67% of sales in the second quarter of fiscal 2006, compared to 68% in the first quarter of fiscal 2006 and 70% in the second quarter of fiscal 2005. For the first six months of fiscal 2006 and 2005, the top 25 customers represented 68% of sales and 69% of sales, respectively. Major original equipment manufacturers (OEMs) accounted for 38% of sales in the second quarter of fiscal 2006, compared to 38% in the first quarter of fiscal 2006 and 41% in the second quarter of fiscal 2005. Cingular Wireless was the largest customer for the second quarter of fiscal 2006 at 10% of sales, flat with the prior quarter due mainly to growth in new product introductions offset by seasonal weakness for Antenna and Cable Products. Lucent Technologies, Siemens, Ericsson and Nortel each represented more than 5% of the company’s sales for the second quarter of fiscal 2006.

Gross profit. Gross profit was 20.6% in the second quarter of fiscal 2006 compared with 24.2% in the second quarter of fiscal 2005. For the second quarter of 2006, gross profit declined 360 basis points versus the second quarter of fiscal 2005 due mainly to higher commodity costs and product mix. The company estimates that higher commodity costs adversely impacted gross profit by 200 basis points, with 140 basis points of this decrease due to increased copper prices. The company estimates that lower sales of E-911 geolocation equipment resulted in a 140 basis point decline in the consolidated gross profit rate.

In the past year, copper prices have risen to unprecedented levels increasing from $1.55 a pound at March 31, 2005 to $2.51 a pound at March 31, 2006. Additionally, on May 5, 2006 the spot price of copper was $3.60 per pound. Although the company has reduced its exposure to copper price fluctuations through the use of forward purchase commitments, the increase in copper prices has significantly increased the company’s costs. For fiscal 2006 the company has purchase commitments for copper that cover approximately 64 million pounds, or more than 90% of the company’s originally planned fiscal 2006 requirements. Due to an increase in customer demand, the company anticipates purchasing an additional six million pounds of copper in the open market during the second half of fiscal 2006, subject to market receptivity of the company’s cable price surcharge. The company announced a price surcharge effective April 3, 2006, on sales of RF cable products to partially offset the rising cost of commodities. In addition, the company has purchase commitments for copper that cover approximately 21 million pounds or approximately 30% of anticipated fiscal 2007 requirements.

In the first six months of fiscal 2006 and 2005 the gross margin was 21.7%. The first quarter of fiscal 2005 included a $19.8 million warranty provision for a component used in certain Base Station Subsystem products that resulted in a 207 basis point decline in the gross margin rate. Excluding this $19.8 million charge, the year over year decline in the gross profit percentage was primarily caused by higher copper prices, which the company estimates decreased gross margin by 175 basis points and a change in product mix driven by lower sales of higher margin geolocation equipment, which the company estimates decreased margin by 110 basis points.

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Research and development expenses. Research and development expenses increased 4.8% to $26.8 million, or 5.6% of sales, in the second quarter of fiscal 2006 compared to $25.6 million or 5.3% of sales in the second quarter of fiscal 2005. In the first six months of fiscal 2006, research and development expenses increased 4.4% to $54.8 million, or 5.5% of sales, compared to $52.4 million, or 5.5% of sales, in the first six months of fiscal 2005. Research and development expenses increased mainly due to higher spending on Network Solutions products, the recent acquisition of certain assets of Nortel’s mobile location business, higher Satellite Communications spending on new product development and the recent acquisition of Skyware Radio Systems.

Sales and administrative expenses. Sales and administrative expenses remained flat at $58.3 million or 12.1% of sales in both the second quarter of fiscal 2006 and 2005. Higher sales and administrative expenses versus the prior year quarter were offset by lower legal costs primarily due to a $5.5 million charge in the second quarter of fiscal 2005 from the resolution of two litigation matters.

In the first six months of fiscal 2006, sales and administrative expenses increased 9.8% to $120.0 million or 12.0% of sales compared to $109.3 million or 11.4% of sales in the first six months of fiscal 2005. Significant factors in this year-over-year increase were: a) a $3.6 million increase in sales commissions and selling expenses, b) $2.9 million for incremental expenses related to the acquisitions of ATC Tower Services in December 2004 and Xenicom in January 2005, c) $2.6 million of additional expenses for equity compensation programs including $1.8 million from the initial impact of stock option expense recognition, d) $2.1 million of additional finance and administrative expenses caused by increases in compliance, audit and legal expenses.

During the first quarter of fiscal 2006, the company adopted SFAS No. 123(R), “Share Based Payments,” which requires the company to record compensation expense for stock options issued to employees. Prior to fiscal 2006, the company accounted for stock options granted to employees under the intrinsic value method of APB No. 25, where no compensation expense was recognized. The company has elected to use the modified prospective transition method where compensation expense is recorded prospectively. The adoption of SFAS No. 123(R) resulted in $0.9 million in the second quarter of fiscal 2006 and $1.8 million in the first six months of fiscal 2006 of sales and administrative expense for stock options compared to no stock option expense being recorded in the first six months of fiscal 2005. For additional information see Note 7, of the Notes to Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

Intangible amortization. Intangible amortization decreased to $4.4 million in the second quarter and $9.5 million for the first six months of fiscal 2006 compared to $5.4 million in the second quarter and $12.9 million in the first six months of fiscal 2005. The reduction in intangible amortization compared to the prior year is due mainly to a reduction of amortized expense associated with intangibles acquired in the acquisition of Allen Telecom in July 2003. It is anticipated that intangible amortization, excluding the impact of recent acquisitions, will be approximately $18 million in fiscal 2006, compared to $22 million in fiscal 2005.

(Gain) loss on sale of assets. In the second quarter of fiscal 2006 the company recorded a gain on the sale of assets of $0.1 million. In the first six months of fiscal 2006 the company recorded a loss on the sale of assets of $1.4 million, which primarily includes a $2.0 million write-down to fair value of certain assets that the company anticipates selling by the end of fiscal 2006. These assets consist of intangible assets of $1.5 million and $0.5 million of inventory and fixed assets. This loss was partially offset by a gain recognized on the sale of unimproved land in Denton, Texas.

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Operating income. Operating income by operating segment for the three and six months ended March 31, 2006 and 2005 is as follows:

	Three Months Ended March 31						% Change		Six Months Ended March 31						% Change
In millions	2006			2005					2006			2005
Operating Income
Antenna and Cable Products	$	29		$	37		(22	%)	$	72		$	76		(5	%)
Base Station Subsystems		3			(1	)	NA			6			(25	)	NA
Network Solutions		6			18		(67	%)		8			34		(76	%)
Wireless Innovations		6			11		(45	%)		16			18		(11	%)
Satellite Communications		(4	)		(3	)	(33	%)		(7	)		(4	)	(75	%)
Items not included in segments
Unallocated Sales and Administrative Costs		(27	)		(31	)	13	%		(54	)		(56	)	4	%
Intangible Amortization		(4	)		(5	)	20	%		(10	)		(13	)	23	%
Gain (Loss) on the Sale of Assets		—			1		NA			(1	)		1		NA
Total Consolidated Operating Income	$	9		$	27		(67	%)	$	30		$	31		(3	%)

For the second quarter and first six months of fiscal 2006, Antenna and Cable Products operating income decreased compared to the prior year due mainly to higher copper costs. For the second quarter and first six months of fiscal 2006, Base Station Subsystems operating income increased versus the prior year due mainly to increased operational efficiencies and a more favorable mix of products sold directly to carriers. Base Station Subsystems operating income for the first quarter of fiscal 2005 includes a $19.8 million charge for a warranty provision for a defective component used in certain base station subsystem products.

For both the second quarter and first six months of fiscal 2006, Network Solutions operating income declined versus the prior year due mainly to an anticipated decline in E-911 geolocation equipment sales. Wireless Innovations operating income decreased versus the prior year in both the second quarter and first six months of fiscal 2006 due mainly to a decrease in sales due to the timing of operator spending for distributed coverage requirements and the unfavorable impact of a stronger dollar versus the euro.

The year-to-date Satellite Communications operating loss increased versus the prior year due mainly to lower sales volumes resulting from the company’s planned reduction of involvement in certain consumer broadband satellite programs. Satellite Communications operating loss for the second quarter of fiscal 2006 includes a $1.2 million cost of goods sold provision in the legacy earth station antenna product line related to a multi-year program.

Interest. Interest expense increased by $0.6 million in the second quarter and $0.7 million in the first six months of fiscal 2006 compared to fiscal 2005 due to increased notes payable borrowings. In the first six months of fiscal 2006, the company increased its notes payable borrowings by $17.9 million to meet short-term working capital needs and reduced its long-term debt by $7.3 million. Interest income remained flat in the second quarter and decreased $0.8 million in the first six months of fiscal 2006 compared to fiscal 2005, due primarily to interest income from a favorable tax ruling recorded in the first quarter of fiscal 2005.

Other expense. Other expense was $0.7 million in the second quarter and $0.5 million in the first six months of fiscal 2006, compared to expense of $0.3 million in the second quarter and $1.8 million in the first six months of fiscal 2005. Other expense is primarily a result of foreign exchange gains and losses. Weakening of the euro against the U.S. dollar was the principal cause for these losses.

Taxes. The reported tax rate was 30.2% for the second quarter and 22.1% for the first six months of fiscal 2006, reflecting underlying effective tax rates on operations of 43.8% and 33.0%, respectively. The underlying effective tax rate on operations for the fiscal 2006 reporting periods decreased versus the prior year primarily due to the permanent reinvestment of earnings in China and a favorable geographic mix shift of earnings. In addition, the reported tax rate for the second quarter of fiscal 2006 benefited from non-recurring tax adjustments, primarily tax benefits related to the repatriation of foreign earnings as compared to the reported tax rate for the second quarter of fiscal 2005. The company currently forecasts its effective tax rate on operations to be 33% for the remaining six months of fiscal 2006.

The reported tax rate was 38.4% for the second quarter and 27.4% for the first six months of fiscal 2005, reflecting underlying effective tax rates on operations of 46.5% and 39.6%, respectively. The reported tax rates for fiscal 2005 include non-recurring tax benefits related to the favorable resolution of certain tax-related matters with government authorities.

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LIQUIDITY AND CAPITAL RESOURCES

Cash and cash equivalents were $154.9 million at March 31, 2006, compared to $188.8 million at September 30, 2005. Working capital at March 31, 2006 was $632.1 million compared to $641.2 million at September 30, 2005. Management believes that the company’s strong working capital position, projected ability to generate cash flow from operations, and ability to borrow under its revolving credit agreements will allow the company to meet its normal operating cash flow needs for the foreseeable future.

The company maintains a $250 million revolving credit facility with a group of lenders that expires in September 2010. Under the terms of this facility, the company is subject to various quarterly covenant requirements, including maintaining a ratio of earnings before interest, taxes, depreciation and amortization (EBITDA) to total debt, including letters of credit, maintaining a ratio of EBITDA to senior debt, maintaining a fixed charge coverage ratio and limiting the amount of assets that the company can dispose of in a fiscal year. These requirements may limit the amount of borrowing under this credit agreement. As of March 31, 2006, the company was in compliance with all of these requirements and had the ability to utilize $233 million of the credit facility.

In the first six months of fiscal 2006, the company generated $11.6 million of cash from operations, compared to $16.3 million generated in the first six months of fiscal 2005. The decrease in cash generated from operations was primarily due to an increase in inventory and a decrease in accounts payable. Cash flow generated from operations in the first six months of fiscal 2006 was primarily the result of net income of $18.4 million, $37.7 million of non-cash charges for depreciation and amortization, offset by a net change in operating assets and liabilities that resulted in a $46.4 million decrease in cash flow.

Accounts receivable increased by $3.7 million in the first six months of fiscal 2006. Accounts receivable were $477.7 million and day’s sales outstanding (DSOs) were 83 days at March 31, 2006, compared to $464.3 million and 76 days at December 31, 2005, and $470.9 million and 81 days at March 31, 2005.

Inventory increased by $12.9 million in the first six months of fiscal 2006. Inventories were $369.2 million and inventory turns were 4.1x at March 31, 2006 compared to $364.8 million and 4.4x at December 31, 2005, and $358.8 million and 4.1x at March 31, 2005. Accounts payable and other liabilities decreased by $23.7 million in the first six months of fiscal 2006, due to a decrease in trade payables and decrease in accrued compensation expenses, primarily as a result of annual incentive payments being made in the first quarter.

Investing activities. The company used $42.2 million of cash for investing activities in the first six months of fiscal 2006, compared to $39.8 million in the first six months of fiscal 2005. Capital expenditures were $33.2 million in the first six months of fiscal 2006, up from $32.5 million in the first six months of 2005. In the first six months of fiscal 2006, the company paid $9.1 million for acquisitions, primarily $8.7 million for Skyware Radio Systems, a producer of electronic products for broadband satellite communications networks. The company also made a final earn-out payment of $0.4 million for its 2004 acquisition of Yantai Fine Cable. The company increased its investment in interest-bearing convertible notes in Cambridge Positioning Systems LTD, a mobile location technology developer by $1.7 million. The company received $1.8 million from the sale of assets, principally from the sale of unimproved land in Denton, Texas.

Investing activities for the first six months of fiscal 2005 included $19.2 million for three acquisitions. The company paid $11.3 million for Xenicom, a United Kingdom-based provider of software solutions that help telecommunications operators plan, launch and manage wireless networks. The company also acquired selected assets of ATC Tower Services, Inc. for total purchase consideration of $8.4 million, including $6.8 million of cash. The company also paid $1.1 million to acquire the remaining 20% interest in a Czech Republic subsidiary that was acquired as part of the Allen Telecom acquisition. In the first quarter of fiscal 2005, the company received net proceeds of $9.5 million from the sale of selected assets of its mobile antenna product line to PCTEL, Inc. In the first six months of fiscal 2005 investing activities included $2.4 million primarily from the proceeds of a facility sale in Reynosa, Mexico, which was acquired from Allen Telecom.

Financing Activities. The company used $4.4 million for financing activities in the first six months of fiscal 2006 compared to negligible net cash generated from financing activities in the first six months of fiscal 2005. The company reduced its net long-term debt by $7.6 million and $9.5 million in the first six months of fiscal years 2006 and 2005, respectively. These debt reductions were due mainly to annual principal payments on senior notes of $7.8 million in the first quarter of each fiscal year. The company borrows under its revolving lines of credit to meet its short-term financing needs. The company increased its notes payable borrowings by $17.8 million and $9.1 million in the first six months of fiscal years 2006 and 2005, respectively. In the first six months of fiscal 2006 the company spent $17.6 million to acquire 1.6 million shares of the company’s common stock. The company generated $3.0 million and $0.7 million in the first six months of fiscal 2006 and 2005, respectively, from stock purchase and option plans. Included in the $3.0 million from stock purchase and option plans for fiscal 2006 is $0.6 million for the tax benefit created from the exercise of stock options.

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CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

The company has contractual obligations and commercial commitments as described in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Aggregate Contractual Obligations and Commitments” of its Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended September 30, 2005. In addition, we have obligations under open purchase orders and the long-term liabilities reflected in our consolidated balance sheet. There have been no material changes in our contractual obligations and commercial commitments since September 30, 2005 arising outside of the ordinary course of business.

CHANGE IN CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The company uses certain critical accounting policies as described in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies” of its Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended September 30, 2005. With the exception of the adoption of SFAS No. 151, “Inventory Costs” and SFAS No. 123(R), “Share Based Payments,” as described in Notes 6 and 7 of the Notes to Consolidated Condensed Financial Statements in this Quarterly Report on Form 10-Q, there have been no material changes in the company’s critical accounting policies during the six months ended March 31, 2006.

This discussion and analysis of financial condition and results of operations is based on the company’s condensed consolidated financial statements, which have been prepared in conformity with accounting principles generally accepted in the United States. The preparation of these financial statements requires the use of estimates and assumptions related to the reporting of assets, liabilities, revenues, expenses and related disclosures. In preparing these financial statements, the company has made its best estimates and judgments of certain amounts included in the financial statements. Estimates are revised periodically. Actual results could differ from these estimates.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

We have made forward-looking statements in this Form 10-Q, including under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in the “Notes to Consolidated Financial Statements.” In addition, management 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. You can identify these statements by the fact that they do not relate strictly to historic or current facts. These statements often contain words like believe, expect, anticipate, intend, contemplate, seek, plan, estimate, forecast 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 under the caption “Risk Factors” in the company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2005 (Part I, Item 1A) and in this Form 10-Q (Part II, Item 1A). As a result, actual results could vary materially from past results and those anticipated, estimated or projected. 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.

We undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law. You are advised, however, to consult any further disclosures we make on related subjects in our 8-K, 10-Q, and 10-K reports filed with or furnished to the Securities and Exchange Commission.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Information with respect to the company’s exposure to interest rate risk, foreign currency risk and commodity risk is contained in Item 7A, Quantitative and Qualitative Disclosures About Market Risk, of the company’s Annual Report on Form 10-K for the year ended September 30, 2005. With the exception of copper purchase commitments, the company believes that there has been no material change from the end of the previous fiscal year through March 31, 2006 to the company’s market risks as disclosed in its Annual Report on Form 10-K for the year ended September 30, 2005.

The company uses various metals in the production of its products. Copper, which is used to manufacture coaxial cable, is the most significant of these metals. The company forecasts that it will use approximately 69 million pounds of copper in fiscal year 2006. As a result, the company is exposed to fluctuations in the price of copper. In order to reduce this exposure, the company has entered into contracts with various suppliers to purchase copper. At March 31, 2006, the company had contracts to purchase 27.6 million pounds of copper for $44.8 million through September 30, 2006. Due to an increase in customer demand, the company anticipates purchasing an additional six million pounds of copper in the open market during the second half of fiscal 2006, subject to market receptivity of the company’s recently announced cable price surcharge. As of May 5, 2006, the market price of copper was

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$3.60/lb. Based on this price, a 10% increase in the market price of copper would increase the company’s cost of this estimated 6 million pounds of copper by approximately $2.2 million. For fiscal 2007, the company has purchase commitments for 21.2 million pounds of copper for $44.4 million.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures:

As of March 31, 2006, the company’s management, including its Chief Executive Officer and Chief Financial Officer, reviewed and evaluated the effectiveness of the company’s disclosure controls and procedures pursuant to Rule 13a-15(b) of the Securities Exchange Act of 1934 (the “Exchange Act”). Based on that review and evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the company’s disclosure controls and procedures were effective as of March 31, 2006 in providing reasonable assurance that information required to be disclosed by the company in reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.

Changes in Internal Controls:

As previously disclosed in the company’s Annual Report on Form 10-K filed with the SEC on December 14, 2005, in connection with the evaluation by management, including its Chief Executive Officer and Chief Financial Officer, of the company’s internal controls over reporting, pursuant to Exchange Act Rule 13a-15(d), the following changes were implemented during the quarter ended December 31, 2005 to the company’s internal control over financial reporting as a result of the existence of material weaknesses as disclosed in the company’s Annual Report on Form 10-K:

Revenue recognition accounting—In order to address the material weakness in its software revenue recognition, the company has established a formal procedure for the review of significant new contracts, including formal communication protocol among the contracts and legal department, group finance directors and corporate accounting, in considering the applicability of SOP 97-2 and all other relevant revenue recognition guidance, and determination of the appropriate revenue recognition policies to apply to those contracts.

Segment reporting—In order to address the material weakness in its application of SFAS 131, key personnel involved in the financial reporting process have enhanced the controls by which the SFAS No. 131 authoritative guidance is monitored and applied on a regular basis. In addition, the company’s disclosure committee now reviews segment reporting on a quarterly basis.

The company completed the implementation of these changes in internal control over financial reporting during the fiscal quarter ended December 31, 2005. The company’s independent registered public accounting firm has not yet audited these remediated controls and will evaluate them in connection with its audit of the company’s internal control over financial reporting as of September 30, 2006.

Except as described above, during the six months ended March 31, 2006 there were no changes in the company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) or in other factors that have materially affected, or are reasonably likely to materially affect, the company’s internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 3 and Item 5 of this Part II are not applicable

ITEM 1. LEGAL PROCEEDINGS

On October 25, 2005, TruePosition, Inc. filed a complaint in the U.S. District Court for the District of Delaware, alleging the company’s potential sale of certain geolocation products to Saudi Telecom will infringe a TruePosition patent. As relief, the complaint seeks, among other things, injunctive relief and unspecified monetary damages. The company filed its answer and counterclaim on December 15, 2005 and intends to defend this litigation vigorously.

The company is also a party to various other legal proceedings, lawsuits and other claims arising in the ordinary course of its business. The company does not believe that such other litigation, if adversely determined, would have a material effect on the company’s business, financial position, results of operations or cash flow.

ITEM 1A. RISK FACTORS

Information regarding risk factors appears in Item 1A. Risk Factors, in the company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2005. The information presented below updates and should be read in conjunction with the risk factors disclosed in the Form 10-K.

If we are required to establish a valuation allowance with respect to our net deferred tax asset, it would adversely affect our effective tax rate and financial results. As of March 31, 2006, we had a net deferred tax asset of approximately $71.6 million, primarily attributable to U.S. net operating losses carried forward, which will begin to expire in 2021. Recoverability of this deferred tax asset is dependent upon our ability to generate future taxable profits in the United States. We continuously review and assess the recoverability of our deferred tax asset and it is our current opinion that the net deferred tax asset is fully recoverable. Should we subsequently determine it is more likely than not that this deferred tax asset will not be realized, we would be required to record a non-cash charge to establish a valuation allowance against some portion or the entire deferred tax asset at that time. Establishing a valuation allowance could have a material adverse impact upon our effective tax rate and reported financial results.

If we experience difficulties in transitioning to new facilities, it could disrupt our business and adversely affect our financial results. On August 29, 2005, the company entered into a contract to sell its Orland Park, Illinois manufacturing and corporate headquarters site for approximately $26 million. This transaction is expected to close in two phases over approximately an eighteen-month period. The corporate headquarters was relocated to a leased facility in Westchester, Illinois in January 2006. The company is constructing a state-of-the-art manufacturing and office facility in Joliet, Illinois and expects construction to be completed in 2007. In order to avoid customer-related disruptions, the company has developed a detailed plan to transition administrative and manufacturing operations to the Joliet facility. However, due to the scope and nature of the move, customer shipments could be affected, which could have an adverse financial result.

The Chinese government could delay issuance of anticipated new wireless network licenses. The Chinese government is planning to issue licenses for next generation wireless networks. It is anticipated that these licenses will be issued during calendar year 2006 and that, in fiscal 2007, we will experience an increase in wireless infrastructure spending associated with the build-out of these anticipated new networks. Significant delays of license issuance could adversely affect our financial results.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Since 1997, the company’s Board of Directors has authorized the company to repurchase up to 30.0 million common shares. As of March 31, 2006, the company had repurchased approximately 20.2 million shares under this plan. These repurchases may be made on the open market or in negotiated transactions and the timing and amount of shares repurchased will be determined by the company’s management. Included in the 20.2 million shares repurchased are 1.6 million shares repurchased in the first quarter of 2006 for $17.6 million. No shares were repurchased in the second quarter of fiscal 2006.

The table below lists the company’s repurchases of shares of common stock during the six months ended March 31, 2006:

Fiscal Year 2006	Total Number of Shares Repurchased	Average Price Paid per Share (1)		Total Number of Shares Repurchased as Part of Publicly Announced Plans	Shares Available for Repurchase
October 1 to October 31	—		—	—	11,389,568
November 1 to November 30	725,000	$	10.73	725,000	10,664,568
December 1 to December 31	875,000	$	11.22	875,000	9,789,568
January 1 to January 31	—		—	—	9,789,568
February 1 to February 28	—		—	—	9,789,568
March 1 to March 31	—		—	—	9,789,568
Total	1,600,000	$	11.00	1,600,000

(1) Average price paid per share is calculated using execution price, excluding commissions paid to brokers.

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

(a) The company’s Annual Meeting of Stockholders was held on February 8, 2006.

(b) Items submitted to a vote

1. Election of Directors

Nominee	FOR	WITHHELD
T. Donahoe	139,578,198	10,149,320
R. Faison	145,105,117	4,622,401
J. Fluno	145,277,574	4,449,944
W. Hunt	145,435,525	4,291,993
C. Nicholas	145,859,789	3,867,729
G. Poch	139,563,008	10,164,510
A. Pollack	142,927,566	6,799,952
G. Toney	145,216,174	4,511,344
A. Zopp	145,255,546	4,471,972

2. The ratification of the appointment of Ernst & Young to serve as independent public auditors for fiscal year 2006 was approved by a vote of 146,515,316 shares for, 2,290,577 shares against, and 921,625 shares withheld.

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ITEM 6. EXHIBITS

Exhibit No.	Description	Reference
10.1 *	Executive Severance Benefit Plan Agreement dated April 14, 2006 between Andrew Corporation and Justin Choi	Incorporated by reference to Exhibit 99.1 to the Form 8-K filed by the company on April 20, 2006 (SEC File No. 001-14617)
10.2 *	Form of Indemnification Agreement dated February 17, 2006	Filed herewith
10.25 *	Deleted. Exhibit 10.25 to Form 10-K for the year ended September 30, 2005, for Executive Severance Benefit Plan Agreement with Jim LePorte.
31.1	Rule 13a-14(a) Certification of Chief Executive Officer	Filed herewith
31.2	Rule 13a-14(a) Certification of Chief Financial Officer	Filed herewith
32	18 U.S.C. Section 1350 Certifications of Chief Executive and Chief Financial Officers	Furnished herewith

* Indicates a management contract or compensatory plan or arrangement

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SIGNATURE

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.

Date May 9, 2006	By:	/s/ Marty R. Kittrell
		Marty R. Kittrell Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer)

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EX-10.2

Exhibit 10.2

EXHIBIT No. 10.2 FORM OF INDEMNIFICATION AGREEMENT

INDEMNIFICATION AGREEMENT

This INDEMNIFICATION AGREEMENT (this “Agreement”) is made and entered into this          day of                     , 2006 (the “Effective Date”) by and between Andrew Corporation, a Delaware corporation (the “Company”), and                      (the “Indemnitee”).

WHEREAS, the Company believes it is essential to retain and attract qualified directors and officers and the Indemnitee is a director and/or officer of the Company, and both the Company and the Indemnitee recognize the increased risk of litigation and other claims being asserted against directors and officers of public companies;

WHEREAS, the Company’s current Certificate of Incorporation (“Certificate of Incorporation”) and By-laws, as amended (the “By-laws”) require the Company to indemnify and advance expenses to its directors and officers to the fullest extent permitted by the DGCL (as hereinafter defined);

WHEREAS, in recognition of the Indemnitee’s need for (i) substantial protection against personal liability based on the Indemnitee’s reliance on the Certificate of Incorporation and By-laws, and (ii) specific contractual assurance that the protection promised by the Certificate of Incorporation and By-laws will be available to the Indemnitee, regardless of, among other things, any amendment to the Certificate of Incorporation and By-laws or any change in the composition of the Company’s Board of Directors (the “Board of Directors” or the “Board”) or acquisition transaction relating to the Company, and as an inducement to continue to provide effective services to the Company as a director and/or officer thereof, the Company wishes to provide for the indemnification of the Indemnitee and to advance expenses to the Indemnitee to the fullest extent permitted by law and as set forth in this Agreement, and, to the extent insurance is maintained by the Company, to provide for the continued coverage of the Indemnitee under the Company’s directors’ and officers’ liability insurance policies;

WHEREAS, the terms and conditions set forth herein are consistent with the terms and conditions of similar agreements adopted by many public company issuers and the Board has determined that contractual indemnification as set forth herein is not only reasonable and prudent but also promotes the best interests of the Company and its stockholders;

WHEREAS, this Agreement is a supplement to and in furtherance of the indemnification provided in the Certificate of Incorporation and By-laws and any resolutions adopted pursuant thereto, and shall not be deemed a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder;

WHEREAS, the Company desires and has requested Indemnitee to serve or continue to serve as a director and/or officer of the Company free from undue concern for unwarranted claims for damages arising out of or related to such services to the Company and Indemnitee is willing to continue to serve the Company on the condition that he is furnished the indemnity provided for herein.

NOW, THEREFORE, in consideration of the premises and the covenants contained herein and of the Indemnitee continuing to serve the Company directly or, at its request, with another enterprise, and intending to be legally bound hereby, the parties hereto agree as follows:

1. Certain Definitions.

(a) A “Change in Control” shall be deemed to have occurred if or upon:

(i) the stockholders of the Company approve the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the Company’s assets (determined on a consolidated basis) to any person or group (as such term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (“Exchange Act”);

(ii) the stockholders of the Company approve a merger or consolidation of the Company with any other person, other than a merger or consolidation which would result in the Voting Securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into Voting Securities of the surviving entity) at least 60% of the total voting power represented by the Voting Securities of the Company or such surviving entity outstanding immediately after such merger or consolidation;

(iii) the stockholders of the Company approve the adoption of a plan the consummation of which would result in the liquidation or dissolution of the Company;

(iv) the acquisition, directly or indirectly, by any person or group (as such term is used in Section 13(d)(3) of the Exchange Act) (other than (a) a trustee or other fiduciary holding securities under an employee benefit plan of the Company; or (b) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company) of beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) of more than 20% of the aggregate voting power of the Voting Securities of the Company; or

(v) during any period of two consecutive years, individuals who at the beginning of such period composed the Board of Directors (together with any new directors whose election by such Board of Directors or whose nomination for election by the stockholders of the Company was approved by a vote of 66 ²/3% of the directors of the Company then still in office who were either directors at the

beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office.

(b) “DGCL” shall mean the General Corporation Law of the State of Delaware, as the same exists or may hereafter be amended or interpreted; provided, however, that in the case of any such amendment or interpretation, only to the extent that such amendment or interpretation permits the Company to provide broader indemnification rights than were permitted prior thereto.

(c) “Expense” shall mean any expense, liability, or loss, including attorneys’ fees, judgments, fines, ERISA excise taxes and penalties, amounts paid or to be paid in settlement, any interest, assessments, or other charges imposed thereon, any federal, state, local, or foreign taxes imposed as a result of the actual or deemed receipt of any payments under this Agreement, and all other costs and obligations, paid or incurred in connection with investigating, defending, being a witness in, participating in (including in the case of an appeal resulting from any Proceeding, the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent), or preparing for any of the foregoing in, any Proceeding relating to any Indemnifiable Event.

(d) “Indemnifiable Event” shall mean any event or occurrence that takes place either prior to or after the execution of this Agreement, related to the fact that the Indemnitee is or was a director or officer of the Company, or while a director or officer is or was serving at the request of the Company as a director, officer, employee, or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, or by reason of anything done or not done by the Indemnitee in any such capacity, whether or not the basis of the Proceeding is alleged action in an official capacity.

(e) “person” shall mean any individual, corporation, general partnership, limited partnership, limited liability partnership, joint venture, association, joint-stock company, trust, limited liability company, unincorporated organization or government or any agency or political subdivision thereof.

(f) “Proceeding” shall mean any threatened, pending or completed action, suit, investigation or proceeding, and any appeal thereof, whether civil, criminal, administrative or investigative and/or or any alternative dispute resolution mechanism (including an action by or in the right of the Company), and/or any inquiry or investigation, whether conducted by the Company or any other party, that the Indemnitee in good faith believes might lead to the institution of any such action, suit, or proceeding, whether civil, criminal, administrative, investigative, or other.

(g) “Reviewing Party” shall mean, prior to any Change in Control, any appropriate person or body consisting of a member or members of the Board or any other person or body appointed by the Board who is not a party to the particular Proceeding with respect to which Indemnitee is seeking indemnification. After a Change in Control (other than a Change in Control approved by a majority of the directors on the Board who

were directors immediately prior to such Change in Control), the special independent counsel referred to in Section 6 below shall become the Reviewing Party.

(h) “Voting Securities” shall mean any securities of the Company which vote generally in the election of directors.

2. Indemnification.

(a) General Agreement. In the event Indemnitee was, is, or becomes a party to or witness or other participant in, or is threatened to be made a party to or witness or other participant in, a Proceeding by reason of (or arising in part out of) an Indemnifiable Event, the Company shall indemnify Indemnitee from and against any and all Expenses to the fullest extent permitted by law, as the same exists or may hereafter be amended or interpreted (but in the case of any such amendment or interpretation, only to the extent that such amendment or interpretation permits the Company to provide broader indemnification rights than were permitted prior thereto).

(b) Certain Exceptions. Notwithstanding anything in this Agreement to the contrary, Indemnitee shall not be entitled to indemnification pursuant to this Agreement:

(1) in connection with any Proceeding initiated by Indemnitee against the Company or any director or officer of the Company unless (i) the Company has joined in or the Board has consented to the initiation of such Proceeding; or (ii) the Proceeding is one to enforce indemnification rights under Section 5; or

(2) for an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act or similar provisions of applicable state law; or

(3) on account of any suit in which final judgment, not subject to appeal, is rendered against the Indemnitee for reimbursement to the Company of any bonus or other incentive-based or equity-based compensation or of any profits realized by Indemnitee from the sale of securities of the Company in each case as and to the extent required pursuant to Section 304 of the Sarbanes-Oxley Act of 2002; or

(4) on account of conduct by Indemnitee that is established by a final judgment, not subject to appeal, as knowingly fraudulent or deliberately dishonest or that constituted willful misconduct; or

(5) on account of conduct by Indemnitee that is established by a final judgment, not subject to appeal, as constituting a breach of Indemnitee’s duty of loyalty to the Company or resulting in any personal profit or advantage to which Indemnitee was not legally entitled; or

(6) for which payment is prohibited by applicable law.

(c) Mandatory Indemnification. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee has been successful on the merits or otherwise in defense of any Proceeding relating in whole or in part to an Indemnifiable Event or in

defense of any issue or matter therein, Indemnitee shall be indemnified against all Expenses incurred in connection therewith.

(d) Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.

3. Advancement of Expenses. The Company shall advance any and all Expenses to Indemnitee in connection with any Proceeding (an “Expense Advance”), and such advancement shall be made as soon as practicable and in any event within 10 business days after the receipt by the Company of a statement or statements from Indemnitee requesting such advances from time to time; provided, however, that if required by applicable law such Expenses shall be advanced only upon delivery to the Company of an undertaking by or on behalf of the Indemnitee to repay such amount if it is ultimately determined by a court of competent jurisdiction in a final judgment, not subject to appeal, that the Indemnitee is not entitled to be indemnified by the Company. Advances shall be made without regard to Indemnitee’s ability to repay the expenses and without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement. This Section 3 shall not apply to any claim made by Indemnitee for which indemnity is excluded pursuant to Section 2(b); provided, however, that the right to advances under this paragraph shall in all events continue until final disposition of any Proceeding.

4. Review Procedure for Indemnification. Notwithstanding the foregoing, the obligations of the Company under Section 2 above shall be subject to the condition that the Reviewing Party shall not have determined (in a written opinion, in any case in which the special independent counsel referred to in Section 6 hereof is the Reviewing Party) that the Indemnitee would not be permitted to be indemnified under applicable law; provided, however, that if the Indemnitee has commenced legal proceedings in a court of competent jurisdiction pursuant to Section 5 below to secure a determination that the Indemnitee should be indemnified under applicable law, any determination made by the Reviewing Party that the Indemnitee would not be permitted to be indemnified under applicable law shall not be binding and the Indemnitee shall not be required to reimburse the Company for any Expense Advance until a final judicial determination is made with respect thereto (as to which all rights of appeal therefrom have been exhausted or have lapsed). The Indemnitee’s obligation to reimburse the Company for Expense Advances pursuant to this Section 4 shall be unsecured and no interest shall be charged thereon. If there has not been a Change in Control, the Reviewing Party shall be selected by the Board, and if there has been such a Change in Control, other than a Change in Control which has been approved by a majority of the Company’s Board who were directors immediately prior to such Change in Control, the Reviewing Party shall be the special independent counsel referred to in Section 6 hereof.

5. Enforcement of Indemnification Rights.

(a) Enforcement Proceedings. If the Reviewing Party determines that the Indemnitee substantively would not be permitted to be indemnified in whole or in part

under applicable law, or if the Indemnitee has not otherwise been paid in full pursuant to Sections 2 and 3 above within 10 business days after a written demand has been received by the Company, the Indemnitee shall have the right to commence litigation in any court in the State of Delaware having subject matter jurisdiction thereof and in which venue is proper to recover the unpaid amount of the demand (an “Enforcement Proceeding”) and, if successful in whole or in part, the Indemnitee shall be entitled to be paid any and all Expenses in connection with such Enforcement Proceeding. The Company hereby consents to service of process for such Enforcement Proceeding and to appear in any such Enforcement Proceeding. Any determination by the Reviewing Party not challenged by the Indemnitee shall be binding on the Company and Indemnitee. The remedy provided for in this Section 5 shall be in addition to any other remedies available to Indemnitee at law or in equity.

(b) Defense to Indemnification, Burden of Proof, and Presumptions. It shall be a defense to any action brought by Indemnitee against the Company to enforce this Agreement (other than an action brought to enforce a claim for Expenses incurred in defending a Proceeding in advance of its final disposition) that it is not permissible under applicable law for the Company to indemnify Indemnitee for the amount claimed. In connection with any such action or any determination by the Reviewing Party or otherwise as to whether Indemnitee is entitled to be indemnified hereunder, the burden of proving such a defense or determination shall be on the Company. Neither the failure of the Reviewing Party or the Company (including its Board, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action by Indemnitee that indemnification of the claimant is proper under the circumstances because Indemnitee has met the standard of conduct set forth in applicable law, nor an actual determination by the Reviewing Party or Company (including its Board, independent legal counsel, or its stockholders) that the Indemnitee had not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the Indemnitee has not met the applicable standard of conduct.

For purposes of this Agreement, to the fullest extent permitted by law, (1) the termination of any Proceeding, action, suit, or claim, by judgment, order, settlement (whether with or without court approval), conviction, or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that Indemnitee did not meet any particular standard of conduct or have any particular belief or that a court has determined that indemnification is not permitted by applicable law, and (2) Indemnitee shall be deemed, for purposes of any determination of good faith, to have acted in good faith if Indemnitee’s action is based on the records or books of account of the Company, including financial statements, or on information supplied to Indemnitee by the officers of the Company in the course of their duties, or on the advice of legal counsel for the Company or the Board or counsel selected by any committee of the Board or on information or records given or reports made to the Company by an independent certified public accountant or by an appraiser, investment banker or other expert selected with reasonable care by the Company or the Board or any committee of the Board.

The knowledge and/or actions, or failure to act, of any director, officer, agent or employee of the Company or other covered enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.

The provisions of this Section 5(b) shall not be deemed to be exclusive or to limit in any way the other circumstances in which the Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.

6. Change in Control. The Company agrees that if there is a Change in Control of the Company (other than a Change in Control which has been approved by a majority of the Company’s Board who were directors immediately prior to such Change in Control), then with respect to all matters thereafter arising concerning the rights of the Indemnitee to indemnity payments and Expense Advances under this Agreement or any other agreement or under applicable law or the Certificate of Incorporation or By-laws now or hereafter in effect relating to indemnification for Indemnifiable Events, the Company shall seek legal advice only from special independent counsel selected by the Indemnitee and approved by the Company, which approval shall not be unreasonably withheld. Such special independent counsel shall not have otherwise performed services for the Company or the Indemnitee, other than in connection with such indemnification matters, within the last five years. Such independent counsel shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or the Indemnitee in an action to determine the Indemnitee’s rights under this Agreement. Such counsel, among other things, shall render its written opinion to the Company and the Indemnitee as to whether and to what extent the Indemnitee would be permitted to be indemnified under applicable law. The Company agrees to furnish a reasonable retainer to and pay the reasonable fees of the special independent counsel referred to above and to indemnify fully such counsel against any and all expenses (including attorneys’ fees), claims, liabilities and damages arising out of or relating to this Agreement or the engagement of special independent counsel pursuant to this Agreement.

7. Non-exclusivity. The rights of the Indemnitee hereunder shall be in addition to any other rights the Indemnitee may have under any statute, provision of the Certificate of Incorporation or By-laws, vote of stockholders or disinterested directors or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office; provided, however, that this Agreement shall supersede any prior indemnification agreement between the Company and the Indemnitee. To the extent that a change in applicable law (whether by statute or judicial decision) permits greater indemnification by agreement than would be afforded currently under the Certificate of Incorporation and By-laws and this Agreement, it is the intent of the parties hereto that the Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change.

8. Liability Insurance. To the extent the Company maintains an insurance policy or policies providing directors’ and officers’ liability insurance, the Indemnitee shall be covered by such policy or policies, in accordance with its or their terms, to the maximum extent of the coverage available for directors or officers, as applicable, of the Company. If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company has directors’ and officers’ liability insurance in effect which covers such claim, the Company shall give prompt notice of the commencement of such Proceeding to the insurers in accordance with the procedures set forth in the respective policies. In the event that this Agreement is terminated in accordance with Section 14(c) below, the

provisions of this section shall continue, with respect to actions or omissions prior to the effective date of such termination, until and terminate upon the later of (A) ten years after Indemnitee has ceased to serve as a director or officer of the Company, as the case may be, or (B) one year after the final termination of all pending or threatened Proceedings of the kind described herein with respect to Indemnitee.

9. Settlement of Claims. The Company shall not be liable to indemnify the Indemnitee under this Agreement for any amounts paid in settlement of any action, suit, claim or proceeding effected without the Company’s written consent, which consent shall not be unreasonably withheld; provided, however, that if a Change in Control has occurred (other than a Change in Control approved by a majority of the directors on the Board who were directors immediately prior to such Change in Control), the Company shall be liable for indemnification of Indemnitee for amounts paid in settlement if the independent counsel referred to in Section 6 above has approved the settlement. The Company shall not settle any action, suit or proceeding in any manner that would impose any fine or other penalty or obligation on Indemnitee without Indemnitee’s prior written consent, which shall not be unreasonably withheld. The Company shall not be liable to indemnify the Indemnitee under this Agreement for any judicial award if the Company was not given a reasonable and timely opportunity, at its expense, to participate in the defense of such action.

10. Period of Limitations. No legal action shall be brought and no cause of action shall be asserted by or on behalf of the Company or any affiliate of the Company against the Indemnitee, the Indemnitee’s spouse, heirs, executors or personal or legal representatives after the expiration of two years from the date of accrual of such cause of action, or such longer period as may be required by state law under the circumstances, and any claim or cause of action of the Company or its affiliate shall be extinguished and deemed released unless asserted by the timely filing of a legal action within such period; provided, however, that if any shorter period of limitations is otherwise applicable to any such cause of action, such shorter period shall govern.

11. Amendment of this Agreement. No supplement, modification, termination or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be binding unless in the form of a writing signed by the party against whom enforcement of the waiver is sought, and no such waiver shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver. Except as specifically provided herein, no failure to exercise or any delay in exercising any right or remedy hereunder shall constitute a waiver thereof.

12. Subrogation. In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of the Indemnitee, who shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such documents necessary to enable the Company effectively to bring suit to enforce such rights.

13. No Duplication of Payments. The Company shall not be liable under this Agreement to make any payment in connection with any claim made against Indemnitee

to the extent the Indemnitee has otherwise actually received payment (under any insurance policy, Certificate of Incorporation, By-law, Trust payment, vote, agreement or otherwise) of the amounts otherwise indemnifiable hereunder.

14. Binding Effect; Successors; Duration.

(a) This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors, assigns, including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of the Company, spouses, heirs, and personal and legal representatives.

(b) The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all, substantially all, or a substantial part, of the business and/or assets of the Company, by written agreement in form and substance satisfactory to the Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

(c) This Agreement may not be terminated except by a writing to that effect executed by the parties hereto. All agreements and obligations of the Company contained herein shall continue during the period that Indemnitee is a director, officer or agent of the Company and shall continue thereafter so long as Indemnitee shall be subject to any possible claim or threatened, pending or completed action, suit or proceeding, whether civil, criminal, arbitrational, administrative or investigative, by reason of the fact that Indemnitee was serving in the capacity referred to herein.

15. Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).

16. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any

Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

17. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware applicable to contracts made and to be performed in such State without giving effect to the principles of conflicts of laws.

18. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

19. Notices. All notices, demands, and other communications required or permitted hereunder shall be made in writing and shall be deemed to have been duly given if delivered by hand, against receipt, or mailed, postage prepaid, certified or registered mail, return receipt requested, and addressed to the Company at:

Andrew Corporation

3 Westbrook Corporate Center

Suite 900

Westchester, IL 60154

Attention: General Counsel

and to the Indemnitee at the address set forth below the Indemnitee’s signature.

Notice of change of address shall be effective only when done in accordance with this Section. All notices complying with this Section shall be deemed to have been received on the date of delivery or on the third business day after mailing.

IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement as of the day first set forth above.

INDEMNITEE:	ANDREW CORPORATION
	By:
Signature		Signature
Name:	Name:
Address:	Title:

On February 17, 2006 Andrew Corporation entered into the preceding form of indemnification agreement with each of the following officers of the company: Justin Choi, John E. Desana, John R.D. Dickson, Ralph E. Faison, Terry N. Garner, M. Jeffrey Gittelman, Daniel J. Hartnett, J.C. Huang, Robert J. Hudzik, Marty R. Kittrell, James L. LePorte III, Fred H. Lietz, Rodger J. Manka, Carleton M. Miller, Mark A. Olson, Jude T. Panetta, James F. Petelle, and Karen A. Quinn-Quintin.

On February 17, 2006 Andrew Corporation entered into the preceding form of indemnification agreement with each of the following members of the board of directors of Andrew Corporation: Thomas A Donahoe, Jere D. Fluno, William O. Hunt, Chuck Nicholas, Gerald A. Poch, Anne Pollack, Glen O. Toney, and Andrea Zopp.

EX-31.1

Exhibit 31.1

Exhibit 31.1 Rule 13a-14(a) Certification of Chief Executive Officer

I, Ralph E. Faison, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Andrew Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2006	/s/ Ralph E. Faison
	Ralph E. Faison President and Chief Executive Officer

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EX-31.2

Exhibit 31.2

Exhibit 31.2 Rule 13a-14(a) Certification of Chief Financial Officer

I, Marty R. Kittrell, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Andrew Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of the annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2006	/s/ Marty R. Kittrell
	Marty R. Kittrell Chief Financial Officer

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EX-32.1

Exhibit 32.1

Exhibit 32 18 U.S.C. Section 1350 Certifications of Chief Executive and Chief Financial Officers

The following statement is being furnished to the Securities and Exchange Commission solely for purposes of Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), which carries with it certain criminal penalties in the event of a knowing or willful misrepresentation.

Securities and Exchange Commission

450 Fifth Street, NW

Washington, DC 20549

Re: Andrew Corporation

Ladies and Gentlemen:

In accordance with the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 (18 USC 1350), each of the undersigned hereby certifies that:

(i) this Current Quarterly Report on Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(ii) the information contained in this report fairly presents, in all material respects, the financial condition and results of operations of Andrew Corporation.

Dated as of this 9th day of May 2006.

/s/ Ralph E. Faison	/s/ Marty R. Kittrell
Ralph E. Faison President and Chief Executive Officer	Marty R. Kittrell Chief Financial Officer

A signed original of this certification has been provided to Andrew Corporation and will be retained by Andrew Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

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