L3Harris (LHX) 425 Business combination disclosure

Filed by Harris Corporation
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934

Subject Companies: Harris Corporation (Commission
File No. 001-3863) and Stratex Networks, Inc.
(Commission File No. 000-15895)

This filing consists of certain communications made in connection with the announcement of a Formation, Contribution and Merger Agreement, dated as of September 5, 2006, between Harris Corporation and Stratex Networks, Inc.:

Cautionary Statement Regarding Forward-Looking Statements

Certain statements in this communication constitute “forward-looking statements.” Forward-looking statements in this release include, but are not limited to, the expected benefits and costs of the transaction; the anticipated timing of completion of the transaction; any projections of earnings, revenues, cost of goods sold, expenses, synergy, accretion, margins or other financial terms; any statements of plans, strategies, objectives, market penetration, and any statements of expectation or belief. Such statements are made in reliance upon the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results could differ materially from those projected or forecast in the forward-looking statements. The factors that could cause actual results to differ materially include the following: the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the proposed transaction within the expected time-frames or at all; integration of the operations of Harris’ Microwave Communications Division with those of Stratex Networks now may be more difficult, time-consuming or costly than expected and may not be as successful as the parties anticipate; revenues of the combined business following the transaction may be lower than expected; operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) of the combined business may be greater than expected following the transaction; the ability to retain key employees in Harris’ Microwave Communications Division and at Stratex Networks subsequent to the completion of the transaction; the conditions to the completion of the transaction may not be satisfied; regulatory approvals that might be required for the transaction might not be obtained on the terms expected and obtaining any such approvals or any other necessary regulatory reviews may not occur on the anticipated schedule; the parties’ ability to meet expectations regarding the timing, completion and accounting and tax treatments of the transaction; Harris’ Microwave Communications Division and Stratex Networks are subject to intense competition; the failure of either Harris’ Microwave Communication Division or Stratex Networks to protect its intellectual property rights may weaken the competitive position of the combined company; in the future third parties may assert claims, including intellectual property infringement claims that could materially adversely affect the operating results of the combined company; as well as other factors discussed in “Risk Factors” under Item 1A. of Stratex Networks’ Annual Report on Form 10-K for the most recently ended fiscal year and Stratex Networks’ other filings with the SEC (which may also be applicable to Harris’ Microwave Communication Division), which are available at http://www.sec.gov. No person assumes any obligation to update the information in this document, except as otherwise required by law. Investors are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.

Additional information and Where to Find It

This communication is for informational purposes only. In connection with the transaction, the parties will file a proxy statement/prospectus with the Securities and Exchange Commission (“SEC”).

This communication may be deemed to be solicitation material in respect of the proposed combination of Harris’ Microwave Communications Division with Stratex Networks.INVESTORS AND SECURITY HOLDERS ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE, INCLUDING THE PROXY STATEMENT/PROSPECTUS THAT WILL BE PART OF THE REGISTRATION STATEMENT, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.Investors and security holders will be able to obtain the documents free of charge at the SEC’s web site,http://www.sec.gov. Copies of the proxy statement/prospectus and the filings with the SEC that will be incorporated by reference in the proxy statement/prospectus may also be obtained when available, without charge, by directing a request to Stratex Networks, Inc., 120 Rose Orchard Way, San Jose, CA 95134, Attention: Office of the Secretary, or to Harris Corporation, 1025 West NASA Blvd., Melbourne, FL 32919, Attention: Office of the Corporate Secretary.

Participants in Solicitation

Stratex Networks, Harris and their respective directors and executive officers and other persons may be deemed to be participants in the solicitation of proxies from the Stratex Networks stockholders in respect of the proposed transaction. Information about the directors and executive officers of Stratex Networks is set forth in the proxy statement for Stratex Networks’ 2006 Annual Meeting of Stockholders, which was filed with the SEC on July 10, 2006. Information about the directors and executive officers of Harris is set forth in the proxy statement for Harris’ 2005 Annual Meeting of Stockholders, which was filed with the SEC on September 14, 2005. Investors may obtain additional information regarding the interest of such participants by reading the proxy statement/prospectus regarding the transaction when it becomes available.

Set forth below is the text of a transcript from the live joint conference call and webcast held by Harris Corporation and Stratex Networks beginning at 5:00 p.m. Eastern time on September 5, 2006:

HARRIS STRATEX NETWORKS, INC.

CONFERENCE CALL

September 5, 2006

     2

1
2
3	I N D E X
4
5	PRESENTATION BY      MR. KISSNER	5
6	PRESENTATION BY      MR. LANCE	7
7	CONTINUED PRESENTATION BY      MR. KISSNER	14
8
9	QUESTION & ANSWER SESSION
10	Ittai Kidron, CIBC World Markets	19
11	John Bucher, BMO Capital Markets	21
12	Matt Robinson, Ferris Baker Watts	25
13	Chris Donaghey, SunTrust Robinson Humphrey	29
14	Kevin Dede, Merriman Curhan Ford	32
15	James McIlree, C.E. Unterberg, Towbin	38
16	Frank Marsala, West Albany Capital	43
17	Larry Harris, Oppenheimer	43
18	Rob Ammann, R.K. Capital	44
19
20
21
22
23
24

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1	OPERATOR: Good afternoon, and welcome to Harris
2	Corporation’s Stratex Networks’ joint conference call.
3	This call is being recorded.
4	Beginning today’s meeting is Pamela Padgett, Vice
5	President of Investor Relations and Corporate
6	Communications of Harris Corporation. Please go
7	ahead.
8	MS. PADGETT: Thank you. Good afternoon and
9	welcome. I’m Pamela Padgett, Vice President of
10	Investor Relations and Corporate Communications. This
11	call is being held to discuss today’s announcement
12	that Stratex Networks and Harris’ Microwave
13	Communications Division will be combined to form a new
14	company named Harris Stratex Networks. On the call
15	with me today is Charles Kissner, Chairman and CEO of
16	Stratex Networks, and Howard Lance, Chairman,
17	President and CEO of Harris Corporation.
18	And before we get started, let me say a few words
19	about forward-looking statements. In the course of
20	this teleconference Howard Lance, Chuck Kissner or
21	other management may make forward-looking statements.
22	Forward-looking statements involve assumptions, risks
23	and uncertainties that could cause results to differ
24	materially from those statements. For more

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1	information and a discussion of such assumptions,
2	risks and uncertainties, please see our joint release
3	and filings made by Harris and Stratex Networks for
4	the SEC.
5	In addition, in the presentation and on this
6	teleconference we will discuss certain ratios and
7	information that are non-GAAP financial measures. A
8	reconciliation to the comparable GAAP measures is
9	included in the presentation.
10	In addition, this conference may include
11	information deemed to be solicitation material in
12	respect of the proposed combination of Harris’
13	Microwave Communications Division with Stratex
14	Networks. A proxy statement/prospectus will be filed
15	with the SEC. Investors should read that document and
16	any other related documents filed with the SEC when
17	available. For more information on how to obtain this
18	document please see our joint release.
19	Harris Stratex Networks and their respective
20	directors, officers and other employees may be deemed
21	to be soliciting proxies in favor of the combination.
22	Information about their respective directors and
23	executive officers is available in their annual proxy
24	statements on file with the SEC. More information

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1	about potential proxy solicitation will be included in
2	the proxy statement/prospectus.
3	A replay of this call will also be made available
4	on the Investor Relations section of our website.
5	And, Howard, with more than those few words, I’ll
6	turn the call over to — Actually I’ll turn it over to
7	Chuck.
8	MR. KISSNER: Thank you, Pam. And just to make
9	sure we’re correct, I’m Chairman of Stratex Networks.
10	Tom Waechter is CEO.
11	Just a little background here. Over the past few
12	years our team at Stratex has realized that in this
13	new world of telecommunications there was a tremendous
14	opportunity for significant independent suppliers of
15	wireless transmission systems. Our customers have
16	Consistently told us both with words and action that
17	they want an independent choice beyond their narrowing
18	field of large infrastructure suppliers. They want to
19	have the freedom to choose the most innovative
20	solutions that they can find.
21	So on behalf of all of our stakeholders, we set
22	about several years ago to fill this need by achieving
23	the level of innovation and scale necessary to become
24	a more valuable partner to our customers. With the

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1	introduction of the innovative Eclipse platform,
2	coupled with high growth, organic progress has clearly
3	moved us closer to the goal.
4	Of course the dedication to create a true leader
5	in our market has also led us to periodically look at
6	strategic ways to accelerate this process. And after
7	careful consideration we determined that now was the
8	time to take that next big step, and to do it with
9	Harris’ Microwave Communications division.
10	By creating a new company with a combination of
11	Stratex and Harris’ Microwave Division, we’re creating
12	the kind of industry leadership that we expect will
13	delight our mutual customers as well as potential new
14	customers. As an immediately recognizable industry
15	leader Harris Stratex Networks is globally strong both
16	in North America and in the rest of the world. Both
17	Harris’ Microwave Division and Stratex Networks have
18	strong innovative products, a complementary customer
19	set, and financial momentum. And very importantly
20	we’re confident that there is a great cultural fit.
21	Today you’re going to hear about the plans for
22	this new company. I’d like you to remember this, the
23	progress that both Stratex and Harris have made in
24	this field has been driven by innovation. And this is

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1	yet another innovative, and yet a logical step, and
2	one that we expect will result in sustainable industry
3	leadership, a valuable enterprise, and a company that
4	will well serve all of our stakeholders whether they
5	be customers, investors or employees.
6	Now I would like to introduce, and especially to
7	our loyal Stratex Networks stockholders, someone I’ve
8	had the great pleasure to work with through this
9	process. In my opinion, Howard Lance, Chairman and
10	CEO of Harris, clearly shares the vision of what a
11	game-changing, major move this can be. Under his
12	leadership, Harris has had outstanding performance in
13	many dimensions. And as you’ll hear, Howard shares
14	our vision and is committed to the success of Harris
15	Stratex Networks. In fact, he plans to serve on the
16	Board of this new company, and I’m absolutely
17	delighted about that.
18	Howard.
19	MR. LANCE: Thanks, Chuck. And good afternoon
20	everyone.
21	As Chuck has already described, the combination
22	of these two businesses is being built on the recent
23	successes and financial momentum of both companies,
24	and it will be further driven by the greater scale and

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1	industry leadership that this combination creates.
2	Not only is there strong strategic rationale
3	supporting the combination, but the financial
4	rationale’s also very compelling. We believe that
5	combining these two companies will provide significant
6	value creation for shareholders on both sides. This
7	really is a game-changing strategy, and I think it has
8	the potential to reshape the industry for wireless
9	transmission network solutions.
10	As Chuck also said, we’re confident this is a
11	deal our customers will embrace. It provides them
12	with an independent wireless transmission supplier
13	with the product innovation required to consistently
14	deliver them the best value via our superior
15	telecommunications solutions. Our customers will
16	immediately benefit from a supplier with greater
17	scale, global reach and a breadth of product offering
18	that is unmatched in the market place.
19	They will also benefit immediately from
20	partnership with a larger, more competitive and
21	financially stronger company, one that will have the
22	financial capacity to continue to invest in new
23	technologies and in adjacent wireless markets.
24	Both companies have a well-earned reputation for

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1	quality, technology and innovation. Bringing our R&D
2	teams and product specialists together, and merging
3	that technology and know-how, will continue to make us
4	a more valuable partner for our customers going
5	forward. Bringing together leaders in innovation and
6	technology makes this combination much more than
7	simply one plus one.
8	We’d like to walk you through a series of slides
9	that will further describe the combination for you.
10	The slides also form the basis for an investor road
11	show that the new company will kick off later this
12	week in New York. The slides are located on the
13	investor relations websites of both companies.
14	If you turn to slide four, you’ll get a sense for
15	what we are creating with this combination of the two
16	companies, a new company with much greater scale,
17	innovative solutions, improved financial performance
18	and flexibility, and a company serving a very large
19	and diverse global customer base.
20	The combination of these two industry leaders
21	will instantly create a larger, more competitive,
22	pure-play wireless technology company capable of
23	achieving stronger financial performance than two
24	stand-alone companies could. And as Chuck mentioned,

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1	this new company will be a recognized industry leader
2	from day one. We will have already earned that
3	position.
4	Slide five outlines the transaction itself.
5	Harris will contribute its Microwave Communications
6	Division and $25 million of cash in exchange for
7	approximately 56 percent ownership of the new company.
8	Stratex Networks shareholders will exchange their
9	existing stock for approximately 44 percent ownership
10	of the new company.
11	The transaction is expected to contribute
12	significantly to the financial results of both
13	companies. It is expected to be neutral to Harris
14	Corporation earnings per share in our fiscal year
15	2007, and then accretive by seven cents per diluted
16	share in fiscal year 2008. This excludes the impact
17	of a one-time gain from the combination, as well as
18	acquisition and integration expenses.
19	The transaction is expected to be slightly
20	accretive to Stratex Networks earnings per share in
21	fiscal year 2007, and then accretive by eight cents
22	per diluted share in fiscal year 2008, also excluding
23	acquisition and integration expenses.
24	The new company will also benefit from the

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1	combined leadership talent that it will have going
2	forward. This begins with both companies having
3	industry veterans at the helm. Guy Campbell,
4	President of the Harris Microwave Communications
5	Division, with more than 20 years experience in this
6	industry, will be Chief Executive Officer. Tom
7	Waechter, CEO of Stratex Networks, will be Chief
8	Operating Officer. Sally Dudash, Vice President and
9	Controller of the Harris Microwave Communications
10	Division will be Chief Financial Officer. The rest of
11	the leadership team combines talent from both
12	organizations.
13	Harris Stratex Networks will have a strong and
14	independent Board of Directors from the beginning.
15	The nine-member Board will consist of five directors
16	nominated by Harris, and four directors nominated by
17	Stratex. A majority of these directors are expected
18	to be independent, including three current directors
19	of Stratex Networks and two of the Harris nominees.
20	The Board will also include Guy Campbell, myself, and
21	Chuck Kissner, who’s agreed to serve as non-executive
22	chairman.
23	Slide six provides a current snapshot of the two
24	companies and the momentum we see in both of their

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1	recent financial performance. Both companies are
2	showing excellent momentum in orders and in revenue
3	growth. Orders have been greater than sales for the
4	past several quarters at both companies. Operating
5	margins have been improving. The slide also points
6	out the complementary nature of the served markets and
7	the fact that both companies have already made
8	significant investments in new, lower-cost product
9	lines to drive future growth and profitability.
10	Turning to slide seven, we summarize the
11	strategic and financial rationale driving this merger.
12	The combination of our two businesses creates
13	significant scale, positioning us as the number three
14	global supplier, adding to our number one position in
15	North America, and becoming the number two supplier in
16	the fast growing Middle East and Africa region.
17	Our highly complementary distribution channels
18	and unmatched product portfolio are very compelling
19	reasons for bringing these two companies together.
20	And as we bring them together, we will also benefit
21	from an estimated $35 million in expected annual
22	savings from product cost reductions and operating
23	expense reductions.
24	The past success of our two companies, the

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1	complementary nature of this merger, and growing
2	global markets, positions Harris Stratex Networks to
3	achieve double digit revenue growth going forward with
4	continuing operating margin expansion. We believe
5	there are great opportunities for an independent
6	supplier capable of providing complete end-to-end
7	transmission solutions and turnkey network services.
8	Turning now to slide eight, these pie charts
9	offer a graphic depiction of the added scale and
10	market share the new company will command on the day
11	of the closing, with direct and channel partner sales
12	coverage in all regions of the world.
13	Slide nine illustrates the complementary nature
14	of our market channels, and shows the last 12 months
15	revenues by region for each company. It also provides
16	a little more detail on the global footprint of the
17	new company. This geographic coverage slide reflects
18	the less than five percent overlap that exists in the
19	current combined customer base. Harris Stratex
20	Networks will have a strong global presence in North
21	America, the Middle East and Africa, Europe and Asia,
22	as well as the ability to address growing
��
23	opportunities in emerging markets such as Russia and
24	India.

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1	Slide ten illustrates the expected market growth
2	forecast going forward. As I think most of you know,
3	the fundamentals of the market remain very strong with
4	expected annual growth rates of 8 percent through
5	2009. The combination of the Eclipse and TRuepoint
6	products positions the new company very nicely in the
7	very desirable growth segments of the overall market.
8	This global growth is being driven by a number of
9	factors. In many emerging markets it’s new network
10	build-outs and network expansions. In more developed
11	markets, such as Europe and North America, it’s being
12	driven by the 3G network rollouts, leased-line
13	substitution for microwave, and expanding bandwidth
14	requirements for new triple-play services. This is
15	driving increased capacity and extended and expanded
16	footprint requirements. In North America we also
17	expect the 2 gigahertz spectrum relocation that is
18	underway to drive new demand similar to that generated
19	in the 1980s when we had the PCS relocation.
20	And in both private networks and mobile networks
21	there is increased focus on the hardening of networks
22	to protect against both natural and man-made
23	disasters.
24	At this point I’m going to turn the call back to

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1	Chuck to discuss the remaining slides.
2	MR. KISSNER: Thank you, Howard. Now, let me
3	continue.
4	If you’ll turn to slide 11, that gives you a
5	pretty compelling graphic of why we think Harris
6	Stratex Networks will deliver an end-to-end product
7	portfolio that’s unmatched in the industry. The
8	combined product offering will be the broadest in the
9	industry, and it includes transport and access
10	microwave radios, carrier-grade Ethernet transmission
11	systems, and network management software. In
12	addition, we’ll continue to provide turnkey network
13	services that include network planning, engineering,
14	and implementation, all of which further deepens the
15	relationship with our customers.
16	On slide 12 we’re pointing out that the
17	successful combination of these two businesses
18	contemplates approximately $35 million in annual cost
19	savings, and we believe this is achievable in fiscal
20	2008, ending June, 2008.
21	Cost savings can be realized from both lower
22	product costs and operating expenses. The combined
23	gross margins between the two companies over the past
24	year have risen from 26 percent to 32 percent, and

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1	we’re targeting 40 percent going forward, and that’s
2	driven by the implementation of joint manufacturing
3	initiatives and volume leverage in the supply chain.
4	Operating expenses as a percentage of revenue declined
5	to 25 — 27 — percent in the prior year, and we
6	believe 25 percent is achievable by addressing
7	duplication in overhead functions.
8	On slide 13, this slide puts a stake in the
9	ground regarding financial targets that we believe can
10	be achieved in the fiscal 2008 to 2009 timeframe. We
11	think these targets are achievable, annual growth rate
12	for revenue of 10 to 15 percent, gross margins of
13	around 40 percent, operating expense at 25 percent of
14	revenue, as I mentioned earlier, with a resulting
15	operating income at 15 percent of sales. We strongly
16	believe this merger will create tangible value for all
17	stakeholders.
18	And on slide 14, just to summarize the
19	presentation, this represents the summary of the value
20	we’re creating with a merger of these two industry
21	leaders.
22	First, the transaction is accretive to both
23	Harris and Stratex shareholders. From the day of
24	signing, Harris Stratex Networks becomes the leading

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1	independent provider of wireless transmission systems.
2	The merger provides this new company with a scale to
3	win. Superior scale should enhance our ability to
4	serve large customers and to compete for major
5	accounts. We’ll also have the opportunity to increase
6	penetration of our mutual customer bases. The
7	opportunity to expand Eclipse and TRuepoint products
8	can be significant. Our strong brands and our best of
9	breed products and technologies create a clear and
10	sustainable product leadership position.
11	I think it’s abundantly clear that the combined
12	geographic coverage puts this new company in a
13	position to seize growth wherever it’s strongest in
14	the global telecommunications market.
15	And finally, the combination of our two
16	businesses will create a world-class engineering,
17	marketing and sales, and global support team, with
18	strengthened overall management leadership. You know,
19	we’ve arrived at this point in time as a result of the
20	progress and the sacrifices made by employees at both
21	companies. We have two outstanding teams, and we
22	believe now is the right time to combine forces and
23	assume a leadership position in this industry.
24	So as you can see, putting together Harris’

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1	Microwave Communications Division and Stratex Networks
2	creates a compelling enterprise.
3	As a clear global leader in our market space,
4	with the synergies afforded by this combination, and
5	with the power to drive even more innovation going
6	forward, a complementary set of customers, products
7	and services, this is a step I firmly believe should
8	be embraced by Stratex Networks shareholders.
9	This is the next logical step, and the timing is
10	right. I feel strongly about this, and as Howard
11	mentioned, I and several of my fellow directors at
12	Stratex have agreed to serve on the Board of this new
13	company. As a combined enterprise, with both industry
14	scale and a level of independence to be nimble, this
15	is a company that all of Stratex Networks’ directors
16	have decided makes tremendous sense.
17	Now, we know many of you have questions about
18	this announcement, so Howard and I, as well as some
19	other members of the management of both Harris and
20	Stratex Networks are on the line.
21	So at this point, Operator, can you please open
22	the calls for questions.
23	OPERATOR: Yes, thank you. The question and
24	answer session will be conducted electronically. If

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1	you would like to ask a question, please do so by
2	pressing the star key followed by the digit one on
3	your touch tone telephone.
4	If you are using a speakerphone, please make sure
5	your mute function is turned off to allow your signal
6	to reach our equipment.
7	Once again, it is star one if you do have a
8	question or a comment. And we’ll pause for a moment.
9	Our first question comes from Ittai Kidron with
10	CIBC World Markets.
11	MR. KIDRON: Congratulations on the announcement.
12	Chuck, perhaps you can walk me through the
13	transaction structure. I’m still somewhat confused on
14	how this exactly works. In three, four months when
15	this deal closes, from what I’m able to understand,
16	Stratex as a public company does not exist anymore, am
17	I correct?
18	MR. KISSNER: That’s correct. There will be a
19	new company called Harris Stratex Networks. The
20	ownership of that company will be around 56 percent
21	owned by Harris Corporation, and the remaining
22	ownership will be based on the current or at the time
23	the Stratex shareholders.
24	MR. KIDRON: Got it. But this entity will then

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1	be a holding, basically a subsidiary of Harris, and I
2	guess at some point when you say it will (inaudible)
3	that means you’ll either spin it off or take it public
4	as a second step?
5	MR. KISSNER: It will be a public company with a
6	majority — with its own board, its own stock, has one
7	large shareholder, one major shareholder — excuse
8	me — one larger shareholder. I’m sure there will be
9	other major shareholders. The largest shareholder
10	will be Harris. And it’ll be publicly traded on the
11	market. And Harris will consolidate the results since
12	it’s a majority shareholder.
13	MR. KIDRON: Okay, thank you.
14	MR. KISSNER: Does that answer your question?
15	MR. KIDRON: I’m still — so this — the public
16	shareholders in the company today will have to hand
17	the shares over in order to get shares in this new
18	entity called Harris Stratex, which will be fully
19	consolidated, and under Harris will not be a public
20	company?
21	MR. KISSNER: No, it will be a public company.
22	And the Stratex shareholders today will exchange their
23	shares, that’s true. By the way, just —
24	MR. KIDRON: But what will they exchange their

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1	shares for?
2	MR. KISSNER: The new company called Harris
3	Stratex Networks.
4	MR. KIDRON: But Harris Stratex Networks is not a
5	listed company.
6	MR. KISSNER: Yes, it will be a listed company on
7	NASDAQ. It’s just has — the largest shareholder will
8	be Harris.
9	MR. KIDRON: Okay. So to put it differently,
10	Harris will contribute its assets to Stratex, and will
11	get 56 percent of Stratex.
12	MR. KISSNER: That’s a better way of looking at
13	it, yeah.
14	MR. KIDRON: Thank you very much. Good luck.
15	MR. KISSNER: I knew you could state it
16	eloquently.
17	MR. KIDRON: (Inaudible.) All right, thank you
18	very much. Congratulations.
19	MR. KISSNER: Thanks.
20	OPERATOR: And we move next to John Bucher with
21	BMO Capital Markets.
22	MR. BUCHER: Thank you. John Bucher. For
23	Howard, first, Howard, besides the cash that you’ve
24	agreed to commit here, do you see any additional cash

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1	requirements on the part of Harris Corporation once
2	Harris Stratex Networks begins rationalizing overhead,
3	facility, administration, and whatnot?
4	MR. LANCE: No. At this point we don’t envision
5	any additional cash infusion required. This company
6	will start out with a very clean balance sheet, and
7	will be in a position to obtain its own financing if
8	that’s required.
9	MR. BUCHER: And then, Howard, maybe you — if
10	you all could talk just a little bit what you can
11	about how this came about. It does appear that
12	there’s some overlap in the product portfolios there,
13	but, you know, clearly you’ve stated a pretty strong
14	case here for a lot of synergies to be had. Is this
15	something that, you know, you’re answering the cry for
16	consolidation, if you will, or you saw a significant
17	synergy in the product portfolio? Could you just sort
18	of talk a little bit about the background leading up
19	to this?
20	MR. LANCE: Well, I think in the end both
21	companies have shown significant progress on their own
22	in redesigning their complete product lines, driving
23	organic growth and returning to profitability. The
24	question was, as a stand-alone company, in either

     23

1	case, either our microwave business or the Stratex
2	Networks business, how far could they go on their own.
3	And we both, I would say, reached a similar conclusion
4	at about the same time, which was that together we
5	could get the benefits of the scale and the leverage.
6	We’re going into, I think, a very strong growth
7	period for the market. Scale really does matter in
8	this market, especially internationally. Together we
9	are almost twice as big internationally as either
10	company would be independently. And that’s a
11	significant factor remembering that about 75 or 80
12	percent of the global market is outside of the United
13	States, and where you’re competing against sizable,
14	integrated global competitors in the infrastructure of
15	providers.
16	So together we’re going to have a much stronger
17	position to be able to operate in those global growth
18	markets and compete effectively, and we think win. We
19	think there’s a very strong place in the market for an
20	independent microwave company focussed on that
21	technology, and all of the services that are
22	surrounding it, and to compete with people who are
23	primarily in other businesses and bundle microwave
24	radios as part of a sale.

     24

1	MR. BUCHER: And then finally, Howard, your
2	implication is that you have the overall market, which
3	you indicated the global market growth of around eight
4	percent or so for all the segments, and you’re
5	targeting the double-digit growth there, in fact, you
6	even say ten to 15 percent or so. It’s because of,
7	number one, your independence, and I guess, number
8	two, the global scope and scale that you think that
9	the combined entity can take the share from here.
10	MR. LANCE: Yeah, I think those two factors,
11	John. And then I would add to that the fact that
12	Harris has transport product lines that they can now
13	market through the existing Stratex Network’s customer
14	base and channels to market. So that’s very
15	important. As well as, together we have the broadest
16	profile in the industry, as the one slide indicates,
17	and an opportunity to serve the customer all the way
18	from their simplest access product need up to their
19	most complex integrated network, and then to wrap
20	around that the support of services in network
21	management.
22	And then finally, I think we’re going to be aided
23	by faster growth because of our focus in faster
24	growing markets. We are both well positioned in

     25

1	emerging markets that are expected to grow a little
2	faster than that eight percent in the total market
3	number, John.
4	MR. BUCHER: Thank you very much.
5	Congratulations.
6	OPERATOR: Next we have Matt Robinson with Ferris
7	Baker Watts.
8	MR. ROBINSON: Hi, good afternoon. I guess
9	you’ve included margins in — on your slides — I
10	can’t see them. Is that correct?
11	MR. KISSNER: That’s right, Matt.
12	MR. ROBINSON: Yeah. Can you talk a little bit
13	about supply chain and facilities, and how the
14	products overlap or where there might be some market
15	expansion for the two companies?
16	MR. KISSNER: Well, you’ve got a couple of
17	questions there wrapped together, I think. But let me
18	try to —
19	MR. ROBINSON: Probably three or four really.
20	MR. KISSNER: First of all, in terms of supply
21	chain, just in general, we do expect to see supply
22	chain efficiencies that will result in lower cost in
23	goods. I think that’s pretty clear from the scale of
24	the company. And we don’t have a lot of overlap in

     26

1	the supply chains right now. So we do believe that by
2	combining the supply requirements we will experience a
3	couple of things. One is volume discounts, but also
4	we can smooth out our demand cycles with our
5	suppliers, which also helps us from a cost point of
6	view.
7	In terms of the overlap and what it does in the
8	market, I think — well, Howard had a slide indicated
9	that there was very little overlap in the market
10	between us. We knew there wasn’t much because we
11	really haven’t run into each other a whole lot around
12	the world. But it was surprising as we went through
13	all of the details why that was true. And without
14	getting into a lot of details, we think it’s less than
15	five percent in terms of overlap.
16	So there’s no big hurry to try to rationalize
17	product lines right now because each of these products
18	have, as you know, some very different characteristics
19	as well as some similar functions; but they’re
20	different enough that they each have a place in the
21	marketplace, whether it’s with a specific customer or
22	an application, whatever. I think the rationalization
23	further down the road is where some of the more
24	exciting opportunity is, but that’s in future

     27

1	generations of product.
2	So I think in terms of components and general
3	supply, and so on, we can move pretty quickly towards
4	getting supply chain efficiencies. The product design
5	efficiencies probably come somewhat later, and still,
6	I think we’re pretty comfortable with the level of
7	synergies that we’ve talked about.
8	MR. ROBINSON: Has Harris gone to the same degree
9	that Stratex has in terms of moving to CMs and
10	bringing as much design into more standard
11	digital-type product manufacturing?
12	MR. LANCE: Matt, I think the answer is a yes and
13	no. Yes from a product line standardization
14	standpoint. Similar to the approach with Eclipse, our
15	TRuepoint product line has — emanates from a common
16	platform with lots of common components. But while we
17	are moving some of our products toward the contract
18	manufacturing business model, we’ve only just started
19	there, and certainly there’s a lot that two companies
20	working together can do to benefit from that model.
21	MR. ROBINSON: So Harris’ side of it will still
22	have significant captive manufacturing?
23	MR. LANCE: Yes. We expect to continue to have
24	manufacturing at our facility at San Antonio, Texas.

     28

1	MR. ROBINSON: In terms of the product overlap my
2	understanding is Harris there’s a lot more in the U.S.
3	has long-haul type products, is that correct?
4	MR. LANCE: We have a complete product line, but
5	our sales distribution would be typically a little
6	over 50 percent in the North America market, and
7	certainly a significant amount of our global sales
8	does come from larger transport and trunking radios,
9	yes.
10	MR. ROBINSON: So Chuck, is that where you’re
11	talking about the absence of overlap?
12	MR. KISSNER: Right. That’s the evidence of it.
13	Clearly we’re focussed 95 percent on the international
14	market, and our entire product line is focussed on the
15	access business, whether it be voice or data access.
16	So somewhat of a different focus, but a great
17	combination when you put all of that together.
18	MR. ROBINSON: What about facilities, I guess the
19	press release talked about the headquarters moving or
20	rather it being in Research Triangle Park, where are
21	the other major facilities?
22	MR. KISSNER: Well, we’re not — the facilities
23	are the same as what we have today between the two
24	companies. And in terms of any rationalization, or

     29

1	whatever, I think those are details that would come
2	out later as we go through the planning process, and
3	get to closure.
4	But as far as the headquarters, the company has
5	to have some headquarters, and the headquarters will
6	be in Research Triangle Park. The headquarters
7	functions will be split between Research Triangle Park
8	and San Jose.
9	MR. ROBINSON: Okay. Thank you.
10	OPERATOR: And we’ll take our next question from
11	Chris Donaghey with SunTrust Robinson.
12	MR. DONAGHEY: Hi, good evening, guys.
13	Congratulations on the deal.
14	First of all, I wonder if you could talk about
15	Stratex’s focus on the international market, you know,
16	what was the rationale in focussing on that market to
17	begin with rather than taking a more domestic focus?
18	MR. KISSNER: Well, part of it is the legacy of
19	the company. If you go way, way back, the company
20	actually was formed out of folks that came out of what
21	became Harris’ Microwave Division 20 something years
22	ago. And I think they started focussing on the U.S.
23	back in the mid ‘80s, but found a much more
24	significant market for this kind of product outside of

     30

1	the U.S. at that time. And the reason why, was that
2	in mobile backhaul something like 80 percent of the
3	transmission is done with microwave radios. So it was
4	a very, very lucrative market. So the company by
5	legacy did quite well in that market, got very, very
6	strong. At the same time whenever it tried to go into
7	the U.S. market, because of its size, and a number of
8	other things, it was difficult for it to gain
9	significant traction. For one reason Harris was a
10	very, very strong supplier in the U.S. market, and so
11	it was somewhat difficult to penetrate. But that
12	market outside of the U.S. has turned out to be very
13	lucrative for Stratex, and it actually drove the
14	designs of the products to fit the international
15	market in a very strong way.
16	I think we’ve always felt that to be a truly
17	global supplier we had to be strong both in North
18	America and outside North America at the same time.
19	And I think that’s one of the reasons why
20	strategically we thought doing something like this
21	made a tremendous amount of sense.
22	MR. DONAGHEY: Okay. And so as you look at those
23	ten to 15 percent targeted top-line growth rate going
24	forward, is that now you’re moving the Stratex

     31

1	products back into the domestic U.S. market or is it
2	still going to be more international focussed in terms
3	of that excess growth opportunity?
4	MR. KISSNER: I think it’s too — Thank you. I
5	think it’s too earlier to really talk about
6	specifically where the products are going to go.
7	Other than to say that both products have a very
8	healthy customer base today, and we expect to sustain
9	that customer base with the products that we have
10	right now. And, you know, going into product
11	substitution, and so on, is not really — we can’t get
12	into that kind of specificity right now.
13	That being said, there are some markets, as
14	Howard talked about, that are particularly strong and
15	growing very quickly. And when we look at the
16	products individually, some of the TRuepoint products
17	are probably a better fit in some of these new markets
18	than Eclipse. And Eclipse is probably a better fit
19	than some of the TRuepoint products. And we intend to
20	take advantage of that.
21	MR. DONAGHEY: Okay, great. Thanks. And one
22	final question. Just on the structure, Howard. So
23	when the deal is closed, the Harris Microwave
24	Communication segment from an income statement

     32

1	prospective will say, Harris Stratex Networks, and it
2	will incorporate the full financial results for that
3	subsidiary, but at the same time, Harris Stratex
4	Networks will report its own financials under a
5	separate set of documents or press releases as a
6	stand-alone company, and, you know, I hate to use this
7	example, but very similar to what we see at Comverse
8	and Verint
9	MR. LANCE: Well, I think what you said is
10	accurate. I don’t know those two companies. But yes,
11	you know, each quarter Harris Stratex Networks will
12	report their full results for the company. As a
13	majority control shareholder we’re required then to
14	consolidate the entire results into our income
15	statement and our balance sheet, all the assets,
16	liabilities, and so on, and then of course at the
17	minority interest line we’ll eliminate the 44 percent
18	of the company that we do not own.
19	MR. DONAGHEY: Okay.
20	MR. LANCE: So what today says Microwave
21	Communication segment will in fact be the aggregate
22	combination of this combined company.
23	MR. DONAGHEY: Okay, great. Thanks, Howard.
24	OPERATOR: Next we have Kevin Dede with Merriman.

     33

1	MR. DEDE: Good afternoon, gentlemen. Would you
2	mind delving into the product mix a little bit more?
3	I understand that Harris is in the process of, what,
4	upgrading Megastar for a March quarter release? I’m
5	just still trying to understand the sense behind
6	supporting both TRuepoint and Eclipse. And then I’d
7	like to know where you would go with the Constellation
8	versus Altium and Aurora versus Zelox.
9	MR. LANCE: Well, I think first of all, Kevin, in
10	the transport space you’re exactly right. We’re
11	developing the TRuepoint 6000, 6500 series, and that
12	will serve two purposes, it will be a global transport
13	product. And with this new combined company we’ll
14	have new customers to go and introduce that product
15	line to, and hopefully displace some others who are
16	currently selling them their transport products.
17	It will also serve in the long run as a
18	replacement not only for the Megastar but for the
19	Constellation product line. That is some quarters
20	out, but that’s the strategy for the development of
21	that product that we’ve been talking to customers
22	about. So that will continue exactly as we have
23	currently planned.
24	I think in the long run Guy Campbell and Tom

     34

1	Waechter and their team will work together to decide
2	how to get the best of the best in the technology.
3	I’m sure there will be some product consolidation, but
4	that’s going to be in the longer term. We’ve got
5	several months here to get through the requirements
6	for closing. There will be a lot of planning going on
7	during that time by joint integration teams that will
8	be put together. And then they’ll be ready to launch.
9	At the closing I’m sure they’ll have some more
10	definitive things that they can say about the product
11	strategy at that time.
12	MR. DEDE: Very good. Are there
13	Hart-Scott-Rodino implications?
14	MR. LANCE: We have to go for a filing, but
15	because of the small amount of revenue that Stratex
16	Networks has in the U.S. we don’t see that as being
17	any kind of an issue.
18	MR. DEDE: Okay. When do you suppose this topic
19	goes before Stratex shareholders?
20	MR. KISSNER: We’ve said that it would probably
21	be in late November if everything goes smoothly.
22	Obviously if it doesn’t, it could take longer than
23	that.
24	MR. LANCE: Stratex expects to file their S4 some

     35

1	time in the next couple of weeks, three weeks, I
2	think, for comment from the SEC. And then the proxy
3	will be put together for the shareholder review.
4	MR. DEDE: So how many outstanding shares will
5	this combined company have?
6	MR. KISSNER: It will be based on the ratio of
7	the shares to be issued, it will be somewhat south of
8	60 million, probably 56, 58 million share level.
9	MR. DEDE: How did you decide on the 56/44 split
10	given that rev split at about 60/40?
11	MR. LANCE: Well, obviously we worked on trying
12	to strike the right balance for what each company has
13	produced in the previous period, but also what each
14	company felt they could produce going forward in terms
15	of both revenue and profitability. And then we looked
16	also at the synergies, and agreed on the 56/44 split
17	as an appropriate way to create value for both the
18	shareholders of both companies as well as to recognize
19	a sharing in the synergies since they really can only
20	be created by both companies coming together.
21	MR. DEDE: So, Chuck, the press release mentions
22	your licensed partner. I’m just wondering what you
23	think their take will be given the competitive nature
24	that they probably see Harris at in North America.

     36

1	MR. KISSNER: Well, I guess you would have to ask
2	them. All I can tell you is that we’re committed to
3	support our license partner or partners going forward.
4	We think it’s an important part of the program, and
5	we’ve carefully integrated that into the planning that
6	we’ve done so far in putting this together, and
7	probably wouldn’t have proceeded if we didn’t feel
8	that we were going to meet our obligations in the most
9	enthusiastic way.
10	MR. DEDE: Last question for me. What’s the
11	headcount at Stratex and the headcount at Harris’
12	Microwave Division, and where do you see that going?
13	MR. KISSNER: Well, let’s see, we have to go get
14	the numbers out of here. Let’s see. Well, Stratex is
15	about 450 in total. And I don’t actually have a
16	number here for —
17	MR. LANCE: It’s around a thousand.
18	MR. KISSNER: Around a thousand. Excuse me, 950,
19	I just got the number. Around 950. Clearly there’s
20	synergies, but we don’t — we can’t really get into
21	the details now about how much of that is affected by
22	headcount.
23	MR. LANCE: Both the teams have a lot of work to
24	do and the planning process on integration between now

     37

1	and the closing certainly there are cost savings that
2	will be realized, but how that translate into
3	individual headcount is too early to articulate.
4	MR. KISSNER: I think the thing to remember is
5	that all the synergies we’re talking about here, they
6	arise from many different sources. The product cost
7	synergies are a very significant part of the synergies
8	going forward. We talked about supply chain, best of
9	best, product design in the long term, and things like
10	that. There is obviously in something like this some
11	duplication of functions, and that impacts people in
12	some way. But to say that all the synergies might be
13	coming out of headcount would be wrong.
14	MR. LANCE: Yeah, absolutely. And at the same
15	time, Kevin and others on the line, don’t go away
16	thinking that we’re just making up or throwing out
17	numbers here. There’s been a lot of detailed analysis
18	that’s been done on these synergies. And it’s really
19	just a question of Guy and Tom and their teams needing
20	time to really put together a detailed transition plan
21	before we’re going to be in a position to discuss a
22	lot of specifics, so. But a lot of analysis has been
23	done, and we are confident in the profitability
24	prospects for the combined company.

     38

1	MR. DEDE: So the net operating loss carried
2	forward, are they washed on this merger?
3	MR. MCARTHUR: Let me speak to that. The net
4	operating loss carried forward will actually continue
5	from a cash flow nature. With regards to an income
6	statement they will come out of the P&L and move to
7	the balance sheet. But as far as the cash generated
8	from the NOLs, they will continue.
9	MR. DEDE: From both companies?
10	MR. MCARTHUR: When you say both companies, the
11	NOLs of — they’ll get combined, and it will be on a
12	balance sheet. There won’t be a P&L as a proven
13	profitability. Being able to run that through the P&L
14	will go away, and it will come up on the balance sheet
15	as a deferred tax item.
16	MR. DEDE: Okay. Thanks very much for taking my
17	questions.
18	MR. KISSNER: That was Gary McArthur, CFO of
19	Harris.
20	OPERATOR: Next we will move to Jim McIlree with
21	Unterberg, Towbin.
22	MR. MCILREE: Thank you. It looks to me like
23	most of the cost savings you’re expecting are coming
24	out of cost of sales because the offset as a percent

     39

1	of sales looks like it’s pretty close to your target.
2	And given that Stratex, I think, peaked gross margins
3	at 38 percent, hitting 40 percent seems like it’s kind
4	of a heroic assumption.
5	So the question is, I know you’ve kind of said
6	that there savings everywhere, but it seems to me that
7	most of the savings are in cost of sales. And if so,
8	you know, how much have you really identified to save
9	in that cost of sales, and how much of the savings is
10	Kentucky Windage
11	MR. KISSNER: In my opinion, looking at the
12	detail that we’ve gone through, as you know we’ve
13	been, at Stratex alone, advertising a target of 36 to
14	38 percent. If I look at the detail that’s behind
15	this, and how we get there, and what the ASPs are in
16	the combined company, and a number of other factors,
17	the 40 percent I think is highly achievable or we
18	wouldn’t have, together, put this on the table.
19	Remember we’re talking about a market that’s
20	global now. We have more power in the market. It’s a
21	combination of the North America and international
22	market, and it’s one that we’re more of a value
23	provider with all the services that go around the
24	products. And so I think it’s quite achievable.

     40

1	Howard, do you want to speak to that, too?
2	MR. LANCE: I certainly agree with you. I think,
3	Jim, one thing you might consider is the positive
4	contribution to that gross margin that comes from the
5	transport part of the market, which has historically
6	for us contributed higher margins than the access only
7	piece.
8	And then secondly, when you look at the network
9	management software and services that we’re able to
10	wrap around the product only offer that we make.
11	So we feel very comfortable that can be achieved,
12	and would not have suggested that number if there
13	wasn’t a basis for getting to it.
14	Again, I think that this very detailed plan you
15	can expect will emerge as we come out of this planning
16	session between signing and closing. And I would say
17	in the same way that we provided relatively specific
18	how to achieve targets during my tenure at Harris
19	we’re going to be doing the same thing in encouraging
20	Guy and Tom Waechter to do that for Harris Stratex
21	Networks. And Tom, or Chuck and I, have been very
22	involved with them as we have worked together to put
23	together the preliminary plans. You’ll hear a lot
24	more detail as we go forward.

     41

1	MR. MCILREE: And then quickly, Howard, slide 13
2	shows the targets for this entity of over ten percent
3	top line, over 15 percent operating income margin,
4	which I think fits your criteria for the kind of
5	companies you want at Harris. So if this is the case,
6	then why not just buy this and reap all of the
7	benefits for Harris shareholders rather than for only
8	56 percent of them, so to speak?
9	MR. LANCE: Well, number one, Jim, a big
10	consideration is creating shareholder value in
11	acquisitions. I have said many times before that
12	that’s always very high on our list. To do that on
13	the basis of the current results a hundred percent
14	acquisition would have been a diluted acquisition.
15	And for that reason I did not believe that was really
16	the best first step.
17	This gives Harris lots of flexibility going
18	forward. We’ve committed to a two-year standstill
19	where we will maintain this ownership for the next two
20	years. Following that we can increase our ownership
21	up to a little higher level, but still are relatively
22	inflexible. But in the long run we become very
23	flexible in terms of whether this kind of a company
24	fits our strategy in terms of what Harris shareholders

     42

1	are trying to achieve.
2	Right now we think it’s the right move. We’re
3	heading into, I think, a prolonged positive growth
4	cycle in the market. We’re going to deliver an
5	accretive transaction and create value for both sets
6	of shareholders. And we’re going to be achieving, as
7	you indicated, Jim, some of the targets that I set.
8	While at the same time we’re going to be giving Harris
9	an expanded commercial communications revenue and
10	growth prospect to help continue to drive
11	diversification in our portfolio.
12	MR. KISSNER: Let me add to that from the Stratex
13	shareholder point of view, and how we looked at this.
14	We think this is a great opportunity for Stratex
15	shareholders to increase the value of their investment
16	by continuing to allow them a vehicle to participate
17	in this. The numbers are very compelling in many,
18	many ways in terms of growth and profitability, and so
19	on. The sustainability is very high in this business
20	with a much larger enterprise. And we felt it was in
21	our shareholders’ interest to give them the ability to
22	participate.
23	MR. LANCE: We also recognize, Jim, you know, the
24	market values pure-play technology companies in a

     43

1	little different way than a defense company, and this
2	is a way to realize some of that value for Harris
3	shareholders as well.
4	MR. MCILREE: Thank you.
5	MR. KISSNER: Thanks.
6	OPERATOR: Next we’ll take Frank Marsala with
7	West Albany Capital.
8	MR. MARSALA: Oh, yes, I’m sorry. My questions
9	have been answered. Thank you.
10	MR. LANCE: Thanks, Frank.
11	OPERATOR: Thank you. We’ll move to Larry Harris
12	with Oppenheimer.
13	MR. HARRIS: Yes, thank you. It sounds like an
14	interesting transaction. I was wondering, you know,
15	over the longer term, and obviously you have to get
16	this transaction approved and operationally off the
17	board, but with 600 million in revenue base do you
18	over time see expanding the product line either in
19	terms of maybe going back to the OEMs interested in
20	buying some of their microwave operations or moving
21	into adjacent areas in wireless infrastructure, not
22	immediately, but over the longer term?
23	MR. LANCE: Larry, I certainly think that Guy and
24	Tom and their management team are going to have lots

     44

1	of potential opportunities that they could have
2	pursued independently, but I think together they get
3	to pursue those more quickly. They have a stronger
4	financial foundation to build on. And whether it’s
5	acquisitions or additional strategic partnerships or
6	moving into adjacent markets, I think all of those are
7	going to be available to this new company.
8	And that’s, I think, part of the excitement that
9	Chuck and I have, is again the foundation of both
10	companies really being on technology and innovation,
11	and together they’re going to be in a much better
12	position to pursue those innovations going forward.
13	MR. HARRIS: All right. Well, thank you very
14	much.
15	MS. PADGETT: Operator, to keep this within an
16	hour, I think we’ll just take one more question
17	please.
18	OPERATOR: Thank you. And we’ll move to Rob
19	Ammann with R.K. Capital.
20	MR. AMMANN: Congratulations. Can you comment —
21	it sounds like you’ll need a pretty full tax rate with
22	the new entity — what tax rate should we assume
23	there?
24	MR. MCARTHUR: Well, who wants to take that one?

     45

1	I mean, we believe — a lot of works has to be done —
2	but we believe that the tax rate once this company
3	gets up and running, and takes advantage of tax rates
4	and global jurisdictions to augment the U.S. tax rate,
5	we think it will be perhaps somewhere in the 30
6	percent rate. So for now, that’s what we would
7	suggest using. Certainly from, let’s say, fiscal year
8	‘08 going forward.
9	MR. KISSNER: But, Rob, I think one other point
10	on this tax rate is, if you use 35 percent, let’s say,
11	let’s assume it’s a full tax rate, the financials are
12	still very compelling.
13	MR. AMMANN: That’s good.
14	MR. KISSNER: So that almost doesn’t really
15	matter at this point.
16	MR. AMMANN: Okay, great. Kind of a follow-up on
17	Jim’s question. It does look like over 80 percent
18	plus of the cost synergies are coming out of the cost
19	of goods sold. And maybe if we could just talk about
20	the strategy for manufacturing looking out long term,
21	looking out, you know, two to three years in terms of
22	what percentage would be manufactured internally
23	versus outsourced.
24	MR. KISSNER: As I said earlier, I think that

     46

1	level of planning and that level of detail really has
2	to be nailed down to the point where Guy and Tom can
3	talk about that at the time of closing or around that
4	time.
5	But clearly the trend is towards more
6	outsourcing. And I think that’s what you should
7	expect from this company. Stratex has been way down
8	the road in terms of outsourcing in a rational way.
9	It doesn’t mean everything has to be outsourced. Some
10	things are better outsourced, and some things are
11	better left inside the company. But whatever benefit
12	there can be from that, I’m sure is going to be
13	applied to the thinking of this company.
14	MR. AMMANN: Okay. And to understand the synergy
15	analysis, the 35 million, that would be realized in a
16	full year in the June ‘08 fiscal year?
17	MR. LANCE: Yes. That’s the way we did that
18	calculation.
19	MR. KISSNER: It’s not per quarter, Rob.
20	MR. AMMANN: No, understood. I just wanted to
21	make sure it wasn’t an exit rate on the June ‘08
22	fiscal year.
23	MR. KISSNER: Okay.
24	MR. AMMANN: And then in terms of the accretion

     47

1	guidance you gave, what amount of synergy is assumed
2	in that, you know, whatever the eight cent accretion
3	to Stratex in fiscal year ‘08?
4	MR. KISSNER: Well, for year ‘08 we have assumed
5	the 35 million. And we then did the analysis as if
6	Stratex were continuing to be a stand-alone company
7	with what the impact would be on their earnings. It’s
8	a little bit of a — it’s a calculation — because as
9	we’ve discussed, there won’t be that stand-alone
10	company. It will be the combined company. But that’s
11	the way the analysis was done in order to try and
12	illustrate the magnitude of the accretion or
13	contribution to earnings that the Stratex shareholders
14	should look forward to seeing in the go-forward
15	company.
16	MR. AMMANN: Okay. But that accretion is for
17	fiscal oh — that was a fiscal ‘08 number, okay. I
18	was thinking —
19	MR. KISSNER: Right, put —
20	MR. AMMANN: — slightly accretive in ‘07, okay.
21	MR. KISSNER: Yes, sir. So it’s on a common
22	basis. Because we’ll be consolidating that, Harris
23	Stratex Networks will be on the — moving to a June 30
24	fiscal year to coincide with Harris.

     48

1	MR. AMMANN: Understood. I think I just had my
2	fiscal years mixed up. And what’s the manufacturing
3	utilization in the Texas facility for Harris?
4	MR. KISSNER: In terms of percent capacity, I
5	don’t know that I can comment on that. Specifically
6	we have — we consolidated our Canadian manufacturing
7	facility into that facility within the last year. We
8	have, though, begun outsourcing of some of our newer
9	access radio products. So we’re not at hundred
10	percent capacity. We could do more manufacturing
11	there, but I don’t know a specific number for you,
12	Rob.
13	MR. AMMANN: Okay, and last question. It looks
14	like I can (inaudible) into Harris’s gross margin last
15	year at somewhere around 36 percent. What sort of
16	long-term guidance or color have you given with
17	respect to where margins for Harris’ microwave
18	business could have been on a stand-alone basis over
19	time?
20	MR. LANCE: We haven’t given any specific gross
21	margin guidance that I recall, Rob. What we clearly
22	said is operating income, the first milestone was ten
23	percent return on sales. We’ve come close to that
24	during the last quarter, and that was our first

     49

1	milestone. We always hoped that we could get to 15
2	percent return on sales beyond that. But we haven’t
3	given any specific numbers on gross margin.
4	MR. AMMANN: Okay, congratulations.
5	MR. KISSNER: Thanks, Rob.
6	MR. LANCE: I want to thank everybody for their
7	interest in today’s announcement, and we hope you’re
8	excited about — as excited about these prospects and
9	the opportunities as we are.
10	I just want to note that over the next several
11	days members of the combined management team for the
12	company will be meeting with investors in various
13	cities around the country. And we’ll be starting with
14	New York on Thursday. And we look forward to seeing
15	many of you at that time.
16	Thanks very much for your interest and your
17	participation. Good day and good night.
18	OPERATOR: And that does conclude today’s
19	conference call. We do thank you for your
20	participation.
21
22
23
24

Set forth below is the joint slide presentation used by Harris Corporation and Stratex Networks, Inc. in connection with the live joint conference call and webcast held beginning at 5:00 p.m. Eastern time on September 5, 2006:

Harris Stratex Networks, Inc. Creating a Leading Global Wireless Transmission Networks Solutions Provider Conference Call September 5, 2006

Forward Looking Statements Certain statements in this presentation constitute "forward-looking statements." Forward-looking statements in this presentation include, but are not limited to, the expected benefits and costs of the transaction; the anticipated timing of completion of the transaction; any projections of earnings, revenues, cost of goods sold, expenses, synergy, accretion, margins or other financial terms; any statements of plans, strategies, objectives, market penetration, and any statements of expectation or belief. Such statements are made in reliance upon the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results could differ materially from those projected or forecast in the forward-looking statements. The factors that could cause actual results to differ materially include the following: the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the proposed transaction within the expected time-frames or at all; integration of the operations of Harris' Microwave Communications Division with those of Stratex Networks now may be more difficult, time-consuming or costly than expected and may not be as successful as the parties anticipate; revenues of the combined business following the transaction may be lower than expected; operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) of the combined business may be greater than expected following the transaction; the ability to retain key employees in Harris' Microwave Communications Division and at Stratex Networks subsequent to the completion of the transaction; the conditions to the completion of the transaction may not be satisfied; regulatory approvals that might be required for the transaction might not be obtained on the terms expected and obtaining any such approvals or any other necessary regulatory reviews may not occur on the anticipated schedule; the parties' ability to meet expectations regarding the timing, completion and accounting and tax treatments of the transaction; Harris' Microwave Communications Division and Stratex Networks are subject to intense competition; the failure of either Harris' Microwave Communication Division or Stratex Networks to protect its intellectual property rights may weaken the competitive position of the combined company; in the future third parties may assert claims, including intellectual property infringement claims that could materially adversely affect the operating results of the combined company; as well as other factors discussed in "Risk Factors" under Item 1A. of Stratex Networks' Annual Report on Form 10-K for the most recently ended fiscal year and Stratex Networks' other filings with the SEC (which may also be applicable to Harris' Microwave Communication Division), which are available at http://www.sec.gov. No person assumes any obligation to update the information in this document, except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.

Additional Information and Where to Find it Additional Information and Where to Find It This presentation is for informational purposes only. In connection with the transaction, the parties will file a registration statement on Form S-4, which will include a proxy statement/prospectus, with the Securities and Exchange Commission ("SEC"). This communication may be deemed to be solicitation material in respect of the proposed combination of Harris' Microwave Communications Division with Stratex Networks. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE, INCLUDING THE PROXY STATEMENT/ PROSPECTUS THAT WILL BE PART OF THE REGISTRATION STATEMENT, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. The definitive proxy statement/prospectus will be mailed to the stockholders of Stratex Networks. Investors and security holders will be able to obtain the documents free of charge at the SEC's web site, http://www.sec.gov. Copies of the proxy statement/prospectus and the filings with the SEC that will be incorporated by reference in the proxy statement/prospectus may also be obtained when available, without charge, by directing a request to Stratex Networks, Inc., 120 Rose Orchard Way, San Jose, CA 95134, Attention: Office of the Secretary, or to Harris Corporation, 1025 West NASA Blvd., Melbourne, FL 32919, Attention: Office of the Corporate Secretary. Participants in Solicitation Stratex Networks, Harris Corporation and their respective directors and executive officers and other persons may be deemed to be participants in the solicitation of proxies from the Stratex Networks stockholders in respect of the proposed transaction. Information about the directors and executive officers of Stratex Networks is set forth in the proxy statement for Stratex Networks' 2006 Annual Meeting of Stockholders, which was filed with the SEC on July 10, 2006. Information about the directors and executive officers of Harris is set forth in the proxy statement for Harris' 2005 Annual Meeting of Stockholders, which was filed with the SEC on September 14, 2005. Investors may obtain additional information regarding the interest of such participants by reading the proxy statement/prospectus regarding the acquisition when it becomes available. Use of Non-GAAP Financial Measures It is important to recognize that in certain instances in this presentation we have adjusted actual financial results, prepared in accordance with generally accepted accounting principles ("GAAP"), for certain items, including special items (which are defined as items not related to the ongoing, underlying business or which in our view distort comparability of results). We have also provided earnings estimates in terms of adjusted earnings, excluding special items and transaction-related expenses. We believe that the resulting adjusted, non-GAAP information provides a picture of results that is comparable among periods since it excludes the impact of items, the size and nature of which can make period to period comparisons difficult and potentially confusing. However, investors should note that non-GAAP measures involve judgments by management. We note that such information is not in accordance with GAAP and should not be viewed as an alternative to GAAP information. A reconciliation of adjusted information to GAAP is included either on the slide where the information appears or in the appendix to this presentation. These slides are only intended to be reviewed in conjunction with the oral presentation to which they relate.

Harris Stratex Networks Industry Leadership Scale Innovative solutions Financial performance Complete Infrastructure Solutions End-to-end wireless transmission capabilities Transport, access, and carrier-grade Ethernet microwave systems Nodal processors Software upgrades Network management solutions Turnkey field services Software licensing to OEMs Large Global Customer Base Mobile & Fixed Wireless operators (cellular, GSM, 3G/UMTS, WiMAX) Government agencies Public utility and transportation companies State and local government & public safety providers Wireline operators Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks Enterprise networks

Transaction Overview Financial Structure Harris contributes Microwave Communications Division and $25M of cash for approximately 56% ownership Stratex shareholders exchange their shares for approximately 44% ownership Two-year standstill, with limitations in years three and four Fiscal year ending June 30; Harris will consolidate results Projected Financial Performance Slightly accretive to Stratex Networks EPS in fiscal year 2007 and accretive by approximately $.08 per diluted share in fiscal year 2008* Neutral to Harris fiscal year 2007 EPS and accretive by approximately $.07 per diluted share in fiscal year 2008** Governance and Company Leadership Guy Campbell, CEO; Tom Waechter, COO; Sally Dudash, CFO Nine-member board, 5/4 Harris/Stratex; majority will be independent Chuck Kissner - non-executive Chairman Includes Howard Lance, Harris Chairman, President and CEO Closing Conditions Regulatory approvals and Stratex shareholder approval * Excluding acquisition and integration expenses ** Excluding a one-time gain as a result of the transaction, and acquisition and integration expenses

Snapshot of the Two Companies (Microwave Communications Division) Continuing improvement in financial performance LTM revenue of $349M and growing at 9% Generated $21.7M in Non-GAAP operating income* and margin of 6.2% Latest quarter Non-GAAP operating margin* reached 9.1% Continuing improvement in financial performance LTM revenue of $242M and growing at 28% Generated $12.0M in Non-GAAP operating income* and margin of 5.0% Latest quarter Non-GAAP operating margin* reached 8.0% Continuing momentum -- orders greater than sales for 6 quarters Continuing momentum -- orders greater than sales for 4 quarters Regional strength in North America; Middle East and Africa Regional strength in Europe, Middle East and Africa; Asia Pacific Recently invested in successful new market-leading TRuepoint(tm) product family Recently invested in successful new market-leading Eclipse(tm) product family * See reconciliation of non-GAAP financial measures in the Financial Information Appendix.

Compelling Strategic and Financial Rationale Creates significantly greater scale -- the largest independent provider of wireless transmission network solutions Compared to all suppliers - #3 Globally and #1 in North America Delivers complementary global distribution channels Minimal customer overlap and significantly expanded customer footprint Serves a large market with expected strong growth over next five years Offers customers an unmatched end-to-end product portfolio Offers expected annual savings of approximately $35M through product costs and operating expenses Creates a larger, highly relevant, and more competitive company Stronger financial performance Greater financial capacity Product leadership Ability to serve adjacent markets Positioned to Deliver Double-Digit Growth and Margin Expansion

Global Market Harris Stratex 15% Stratex 6% Harris 9% A Leading Global Provider of Wireless Transmission Network Solutions North American Market Harris Stratex 48% Estimated based on calendar year 2005 global market of $3.5 billion Source: Management estimates Harris 46% Stratex 2%

Complementary Global Distribution Channels With Less Than 5% Overlap $ 175 $ 11 $ 186 $ 29 $ 22 $ 51 $ 21 $ 56 $ 77 $ 100 $ 81 $ 181 $ 24 $ 72 $ 96 North America Latin America Middle East/Africa Europe (incl. Russia) Asia Pacific * Based on the latest twelve months ended June 30, 2006 Revenue by Region* ($ in millions) Harris $349 Stratex $242 Total $591 #3 Globally, #1 in North America, #2 in Middle East and Africa, and an expanded footprint across Europe, Asia, Latin America, and emerging growth markets of Russia and India

Microwave Market Growth Expected Total Global Market Growth of 8%; Strong Positioning in Higher Growth Segments Source: Management estimates 2006 2007 2008 2009 PDH access 2317 2461 2608 2859 PDH Transport 200 210 210 215 SDH Access (incl Ethernet) 713 847 976 1083 SDH Transport 705 711 750 780 ($ in millions) CAGR: 7% Eclipse E300SP; TRuepoint 4000 CAGR: 3% TRuepoint 6500 CAGR: 15% Eclipse E300HP; TRuepoint 5000 TRuepoint 6000

Unmatched End-to-End Product Portfolio Other Independent Suppliers Transport SDH PDH Access SDH PDH Network management solutions IP Turnkey planning, engineering, and implementation Source: Management estimates

Solid, Achievable Plan for Cost Synergies Cost of goods sold Increased outsourcing on some products to low-cost contract manufacturers Supply chain volume leverage Low-cost design architecture "best of the best" Operating expenses* Duplicate administrative and overhead costs Adherence to common engineering design processes Targeted annual cost savings of $35M in fiscal year 2008 2005 2006 GM 20 25 Combined gross margin 26% 32% Targeting 40% 2005 2006 Op Exp 30 27 20 20 20 30% 26% Combined operating expenses as % of revenue* Targeting 25% * See reconciliation of non-GAAP financial measures in the Financial Information Appendix.

Harris Stratex Networks Performance Targets Latest twelve months performance* Latest twelve months performance* Targets Harris Microwave Stratex Networks 2008-2009 Year-over-year revenue growth 9% 28% 10-15% Gross margin 34% 30% 40% Operating expenses as % of sales 27% 24% 25% Operating income margin 6% 5% 15% Targeting Double-Digit Revenue Growth and Operating Margin Expansion to 15% * See reconciliation of non-GAAP financial measures in the Financial Information Appendix.

In Summary The transaction is projected to be accretive to both Stratex and Harris shareholders From inception, creates a leading global provider of wireless transmission network solutions with leadership products and services Provides the scale to win major contracts, deliver sustainable growth, and continue industry-leading innovation Delivers complementary geographic coverage resulting in a balanced global presence Combines the management talent of two companies for strong leadership Results in a more valuable partner for a widely diversified global customer base Positioned for Profitable, Sustainable Growth

Financial Information Appendix

Combined Pro Forma Latest Twelve Months Ended June 30, 2006 ($ in millions) * See reconciliation of non-GAAP financial measures in the Financial Information Appendix

Combined Pro Forma Balance Sheet as of June 30, 2006 ($ in millions) * Represents cash, cash equivalents and short-term investments

Reconciliation of Non-GAAP Financial Measures Harris Stratex Networks, Inc. September 5, 2006

Reconciliation of Non-GAAP Financial Measures Slide Title: Snapshot of the Two Companies

Reconciliation of Non-GAAP Financial Measures Slide Title: Snapshot of the Two Companies

Reconciliation of Non-GAAP Financial Measures Slide Title: Solid, Achievable plan for Cost Synergies

Reconciliation of Non-GAAP Financial Measures Slide Title: Solid, Achievable plan for Cost Synergies

Reconciliation of Non-GAAP Financial Measures Slide Title: Harris Stratex Networks Performance Targets

Reconciliation of Non-GAAP Financial Measures Slide Title: Combined Pro Forma Latest Twelve Months Ended June 30, 2006