##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
 Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Fiscal Year Ended
    September 30,
    2009ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to          .   Commission File Number 1-4817
  
  WHITE ELECTRONIC DESIGNS
    CORPORATION
 (Exact name of registrant as
    specified in its charter)
  Indiana(State or other jurisdiction
    of
    incorporation or organization)

35-0905052(I.R.S. Employer
    Identification No.)3601 E. University Drive
    Phoenix, Arizona(Address of principal
    executive offices)

85034(Zip
    Code)   Registrants telephone number, including area code:
    (602) 437-1520
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, stated value $.10 per share

NASDAQ Global Market   Securities registered pursuant to Section 12(g) of the
    Act: None
  o þ
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
 Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE
  Form 10-K.




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##### 





TABLE OF
    CONTENTS
   
 NOTE REGARDING FORWARD-LOOKING STATEMENTS
    AND ASSOCIATED RISKS


3PART I


4ITEM 1


BUSINESS


4ITEM 1A


RISK FACTORS


10ITEM 1B


UNRESOLVED STAFF COMMENTS


18ITEM 2


PROPERTIES


18ITEM 3


LEGAL PROCEEDINGS


19ITEM 4


SUBMISSION OF MATTERS TO A VOTE OF SECURITY
    HOLDERS


19PART II


19ITEM 5


MARKET FOR REGISTRANTS COMMON EQUITY,
    RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
    SECURITIES


19ITEM 6


SELECTED CONSOLIDATED FINANCIAL DATA


21ITEM 7


MANAGEMENTS DISCUSSION AND ANALYSIS OF
    FINANCIAL CONDITION AND RESULTS OF OPERATIONS


22ITEM 7A


QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
    MARKET RISK


32ITEM 8


FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


33ITEM 9


CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
    ACCOUNTING AND FINANCIAL DISCLOSURE


33ITEM 9A


CONTROLS AND PROCEDURES


33ITEM 9B


OTHER INFORMATION


34PART III


34ITEM 10


DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
    GOVERNANCE


34ITEM 11


EXECUTIVE COMPENSATION


34ITEM 12


SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
    AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS


34ITEM 13


CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,
    AND DIRECTOR INDEPENDENCE


35ITEM 14


PRINCIPAL ACCOUNTANT FEES AND SERVICES


35PART IV


36ITEM 15


EXHIBITS AND FINANCIAL STATEMENT
    SCHEDULES


36SIGNATURES


40EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1EX-32.2   2




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NOTE REGARDING
    FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS  Form 10-K (Form 10-K),
  and/or Form 10-K,
  
    the loss of one or more principal customers or delays or
    cancellations of orders due to the impact of adverse business
    conditions or price competition on one or more principle
    customers;
    the inability to procure required components and raw materials;
    any downturn in the defense, aerospace, semiconductor or other
    markets in which we operate, which could cause a decline in
    selling unit prices or volume;
    reductions in military spending, shifts of funding allocations
    or changes in the acquisition requirements for military products;
    the inability to develop, introduce and sell new products or the
    inability to develop new manufacturing technologies;
    the failure of customers to accept our anti-tamper processing or
    the development of improved anti-tamper processing by
    competitors;
    the ability to locate appropriate acquisition candidates,
    negotiate an appropriate purchase price, obtain the necessary
    financing, and integrate into our business the people,
    operations, and products from acquired businesses, or implement
    other strategic alternatives;
    changes or restrictions in the practices, rules and regulations
    relating to sales in international markets; and/or
    changes resulting from severe economic downturns that affect our
    customers, suppliers and lenders.  Form 10-K, Form 10-K
 3




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PART I  ITEM 1
    BUSINESS  GENERAL
          (602) 437-1520. www.whiteedc.com . Form 10-K,
  BUSINESS
    SEGMENTS
    DEFENSE
    ELECTRONICS SEGMENT
   4




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
    significant space savings and weight advantages;
    improved electrical performance; and
    improved reliability for harsh requirements.      MARKET CATEGORY

SAMPLE PROGRAMS

Missiles & Ordnance



Advanced Medium Range Air-to-Air Missile (AMRAAM)

Advanced Intercept Missile (AIM) AIM-9X

Tactical Tomahawk (TACTOM)

Precision Guided Kits (PGK)

Extended Range Guidance Munitions (ERGM)

Patriot Advanced Capability (PAC) PAC3

Excalibur

Communication & Net-Centric



Joint Tactical Radio System  (JTRS)

Single Channel Ground and Airborne Radio System
    (SINCGARS)

Combat Survivor Evader Locater (CSEL)

Aircraft



F-35 Joint Strike Fighter

F-18 Hornet

F/A-22 Raptor

V22 Osprey

Euro fighter 2000

AH64 Apache  5




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PRODUCT

SAMPLE APPLICATION

System in package



Counter-measure suite for the F-16 Fighting Falcon 16 Fighting
    Falcon

Microprocessor modules



Air-to-air missiles, such as the AIM-9X Sidewinder and
    AIM-120 AMRAAM

Embedded computers used in the Apache Helicopter, Advanced
    Amphibious Assault Vehicle and the Abrams M1A2 Tank

Memory modules



Air-to-air missiles, such as the AIM-9X Sidewinder and
    AIM-120 AMRAAM

Embedded computers used in the F-22 Raptor and Patriot PAC-3
    Missile System

Radar used in the F/A-18 Hornet

Joint Strike Fighter, F-35

Euro-fighter 2000

Mechanical components



Impulse counters, altitude counters, rounds counters, F-16 trim
    panel

Anti-tamper technology



Various military programs   Backlog
    Competition
      SALES,
    MARKETING AND DISTRIBUTION
   6




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quarter-to-quarter
    PRINCIPAL
    CUSTOMERS
        FOREIGN
    OPERATIONS
    RESEARCH,
    ENGINEERING AND PRODUCT DEVELOPMENT
    
    developing new products;
    improving existing products;
    adapting existing products to new applications; and
    developing prototype components for specific programs.    REGULATORY
    MATTERS
  Government
    Contracting Regulations
   7




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Environmental
    Matters
    International
    Trade Regulations
   8




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RAW
    MATERIALS
    INTELLECTUAL
    PROPERTY
        EMPLOYEES
    FINANCIAL
    INFORMATION BY GEOGRAPHIC SEGMENT
   9




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AVAILABLE
    INFORMATION
  www.whiteedc.com Form 10-K, Form 10-Q, Form 8-K
  ITEM 1A
    RISK
    FACTORS  We are
    subject to various risks associated with our decision to
    streamline our business and dispose of operations classified as
    discontinued operations.
    Current
    economic conditions may adversely affect our industry, business
    and results of operations.
    We are
    dependent on sales to defense-related companies for a large
    portion of our net sales and profits, and changes in military
    spending levels and patterns could negatively affect
    us.
    and/or
  The
    transition of the U.S. defense industry to purchase commercial
    off-the-shelf
    products and other trends within our industry could negatively
    affect us.
  off-the-shelf
 10




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off-the-shelf
  The
    competitive bid process for government contracts may negatively
    affect us.
    Our
    goodwill may become impaired in the future.
    We may
    make strategic acquisitions and cannot assure you that any
    future acquisitions will be successful.
  and/or
  
    exposure to unanticipated liabilities of an acquired company;
    the potential loss of key customers or key personnel of an
    acquired company;
    the recording of goodwill and intangible assets that will be
    subject to impairment testing on a regular basis and potential
    periodic impairment charges;
    the diversion of the attention of our management team from other
    business concerns;
    the risk of entering into markets or producing products where we
    have limited or no experience, including the integration of the
    purchased technologies and products with our technologies and
    products; and
    our ability to assess, integrate and implement internal controls
    of an acquired company in accordance with Section 404 of
    the Sarbanes-Oxley Act of 2002.    Our
    customers may cancel their orders, change production quantities
    or delay production at any time, which could materially reduce
    our net sales and operating results.
   11




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We
    have a concentrated customer base and, as a result, our net
    sales could decline significantly if we lose a major
    customer.
    We
    depend on military prime contractors for the sale of our
    products and the failure of these customers to achieve
    significant sales of products incorporating our components would
    reduce our net sales and operating results.
    We
    depend on the continuing trend of outsourcing by prime military
    contractors, which is subject to factors beyond our
    control.
    Our
    failure to comply with United States government laws,
    regulations and manufacturing facility certifications would
    reduce our ability to be awarded future military
    business.
   12




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We may
    have an adverse resolution of litigation which may harm our
    operating results or financial condition.
    We may
    fail to meet projected financial results because our net sales,
    gross profits and net income fluctuates from period to period,
    which may in turn adversely affect the market price of our
    common stock.
    
    our inability to adjust expenses for any particular quarter in
    response to net sales shortfalls because a substantial component
    of our operating expenses are fixed costs;
    the complexity of our manufacturing processes and the
    sensitivity of our production costs to declines in manufacturing
    yields, which make yield problems both possible and costly when
    they occur;
    expenses associated with process and organizational revisions;
    expenses associated with acquisitions; and
    general economic conditions.    We
    have a lengthy sales cycle, which increases the likelihood that
    our quarterly net sales will fluctuate and which may, in turn,
    adversely affect the market price of our common
    stock.
    Our
    failure to detect defects in our products could materially harm
    our relationship with customers, our reputation and our
    business.
   13




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Our
    operating results could be negatively impacted if the markets in
    which we sell our products do not grow.
    Downturns
    in the defense and aerospace markets could reduce the value of
    our inventories and cause a reduction in our
    profits.
    We are
    dependent on international markets for a large portion of our
    purchases and sales.
    and/or
  
    fluctuations in foreign currencies, which may adversely affect
    the prices of our products and the prices of raw materials used
    in our products;
    trade disputes;
    changes in regulatory requirements, license requirements,
    tariffs and other trade barriers;
    the possibility of quotas, duties, taxes or other changes or
    restrictions upon the importation or exportation of our products
    implemented by the United States government or foreign
    governments;
    the timing and availability of export or other licenses;
    general political and economic conditions in the countries in
    which we sell our products;
    language and other cultural differences which may inhibit our
    sales and marketing efforts;
    costs of complying with a variety of foreign laws, including
    import or export licensing requirements;
    difficulty of accounts receivable collections;
    increased chances of our intellectual property being infringed
    as a result of the failure of foreign governments to enforce the
    protection of intellectual property rights; and
    public health issues
    and/or
    natural disasters that could disrupt local economies.  We
    maintain all of our cash and cash equivalents, some of which are
    not insured, at two depository institutions.
   14




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If we
    are unable to retain employees with key technical expertise, our
    financial condition and future prospects could be materially
    harmed.
    If we
    are unable to protect our intellectual property or if we are
    found to have infringed third party intellectual property
    rights, our business could be adversely and materially
    affected.
      Our
    business is dependent upon retaining key personnel and
    attracting new employees.
    Our
    failure to comply with environmental regulations could subject
    us to costs and production delays.
   15




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If our
    selling prices decline and we fail to reduce our costs, our
    sales and operating results will decline.
      If we
    fail to develop, introduce and sell new products or fail to
    develop and implement new manufacturing technologies, our
    operating results could be adversely affected.
    
    we fail to complete and introduce new product designs in a
    timely manner;
    we are unable to design and manufacture products according to
    the requirements of our customers;
    our customers do not successfully introduce new systems or
    products incorporating our products;
    our competitor(s) design and produce products with similar or
    superior performance capabilities;
    market demand for our new products does not develop as
    anticipated;
    we are unable to obtain raw materials in a timely manner or at
    favorable prices;
    we are unable to maintain pricing to sustain or grow our gross
    margins; or
    we fail to anticipate our customers changing needs and
    emerging technological trends.   16




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Increasing
    competition could reduce the demand for our
    products.
    We
    depend on limited suppliers for certain critical raw
    materials.
    Terrorism
    and the global responses to terrorism, the unsettled world
    political situations and perceived nuclear threats increase
    uncertainties with respect to many of our businesses and may
    adversely affect our business and results of
    operations.
      While
    we believe our control systems are effective, there are inherent
    limitations in all control systems, and misstatements due to
    error or fraud may occur and not be detected.
   17




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Our
    Board of Directors is authorized to issue shares of preferred
    stock that could have rights superior to our outstanding shares
    of common stock, and, if issued, could adversely impact the
    value of our common stock.
    
    voting rights, including the right to vote as a class on
    particular matters;
    preferences as to dividends and liquidation rights;
    conversion rights and anti-dilution protections; and
    redemption rights.    Our
    stock price has been volatile.
    
    future announcements concerning the Company, our competitors or
    our principal customers, such as quarterly operating results,
    adjustments to previously reported results, changes in earnings
    estimates by analysts, technological innovations, new product
    introductions, governmental regulations, or litigation;
    the liquidity within the market of our common stock;
    sales of common stock by our officers, directors and other
    insiders;
    investor perceptions concerning the prospects of our business;
    market conditions and investor sentiment affecting market prices
    of equity securities of high technology companies in the defense
    electronics industry;
    general economic, political and market conditions, such as
    recessions or international currency fluctuations;
    market reaction to acquisitions, joint ventures or strategic
    investments announced by us or our competitors;
    lawsuits filed against the Company; and
    compliance with the Sarbanes-Oxley Act.  ITEM 1B
    UNRESOLVED
    STAFF COMMENTS   18




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ITEM 2
    PROPERTIES    SquareLocation

Footage


Own/Lease

SegmentPhoenix, Arizona (Headquarters)


74,000


Lease

Defense ElectronicsFort Wayne, Indiana


75,000


Own

Defense ElectronicsColumbus, Ohio


41,000


Own

*     *
    
    The Columbus, Ohio business is included in discontinued
    operations. We expect to sell the building and land in December
    2009 for $636,000.      ITEM 3
    LEGAL
    PROCEEDINGS    ITEM 4
    SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS   PART II  ITEM 5
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES  Market
    Information
    High


LowYear Ended September 30, 2009First quarter


5.05



3.00Second quarter


4.50



3.58Third quarter


5.05



4.02Fourth quarter


4.84



3.94Year Ended September 27, 2008First quarter


5.45



4.46Second quarter


5.00



3.99Third quarter


5.39



4.26Fourth quarter


5.25



4.27  19




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Issuer
    Purchases of Equity Securities
    Performance
    Graph
    5-year
  COMPARISON
    OF 5 YEAR CUMULATIVE TOTAL RETURN*
    Among White Electronic Designs Corporation, The NASDAQ Composite
    Index
    And The S&P Aerospace & Defense Index
  
  *
    
    $100 invested on 9/30/04 in stock or index (including
    reinvestment of dividends, if any). Fiscal year ending
    September 30th.  9/04


9/05


9/06


9/07


9/08


9/09White Electronic Designs Corporation



100.00




104.29




101.64




106.75




102.25




94.48NASDAQ Composite



100.00




113.78




121.50




143.37




109.15




112.55S&P Aerospace & Defense



100.00




115.95




140.53




186.76




139.28




132.43    20




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ITEM 6
    SELECTED
    CONSOLIDATED FINANCIAL DATA  2005-2009
  2009


2008


2007


2006


2005Statement of Operations Data:Net sales

$
62,559


$
56,355


$
52,073


$
48,756


$
48,452Income from continuing operations(1)

$
2,996


$
2,483


$
5,173


$
5,524


$
6,025Income (loss) from discontinued operations(2)


(967
)


(8,470
)


(2,087
)


489


$
(9,561
)Net income (loss)

$
2,029


$
(5,987
)

$
3,086


$
6,013


$
(3,536
)Income from continuing operations per common share:Basic

$
0.13


$
0.11


$
0.22


$
0.23


$
0.25Diluted

$
0.13


$
0.11


$
0.21


$
0.22


$
0.24Income (loss) from discontinued operations per common share:Basic

$
(0.04
)

$
(0.38
)

$
(0.09
)

$
0.02


$
(0.39
)Diluted

$
(0.04
)

$
(0.37
)

$
(0.09
)

$
0.02


$
(0.39
)Net income (loss) per common share:Basic

$
0.09


$
(0.27
)

$
0.13


$
0.25


$
(0.14
)Diluted

$
0.09


$
(0.26
)

$
0.13


$
0.24


$
(0.14
)Balance Sheet Data (at year end):Total assets

$
111,597


$
111,658


$
124,890


$
130,508


$
121,268Long-term debt

$



$



$



$



$
Shareholders equity

$
101,890


$
98,838


$
106,372


$
110,180


$
104,220   This table should be read in conjunction with the
    Consolidated Financial Statements and the Notes to the
    Consolidated Financial Statements provided elsewhere herein.
    (1)
    
    In fiscal 2009, the Company recorded $0.7 million in
    expenses related to the proxy contest and shareholder agreement,
    as well as $0.5 million in board-related and outside
    advisor fees due to the completion of the Strategic Alternatives
    Committee work and the retirement of our founder and former
    Chairman Edward A. White. In fiscal 2008, the Company recorded
    $2.8 million in severance costs related to the departure of
    its Chief Executive Officer. Approximately $1.0 million of
    these costs were recorded in stock compensation expense for
    accelerated vesting and modifications of stock-based
    compensation. The remainder primarily related to cash payments
    in accordance with his severance agreement.(2)
    
    In fiscal 2008, the Company recorded $3.5 million for the
    estimated loss on sale of discontinued operations. This
    consisted of the write-off of existing technology and customer
    relationship intangibles as well as the write-down of certain
    property, plant and equipment and inventory to lower of cost or
    market. In fiscal 2007, the Company recorded a non-cash
    intangible asset impairment charge of $1.4 million related
    to customer relationships. In fiscal 2006, the Company recorded
    a non-cash goodwill impairment charge of approximately
    $0.4 million in connection with its review of goodwill for
    impairment. In fiscal 2005, the Company recorded a non-cash
    goodwill impairment charge of approximately $11.4 million
    in connection with its review of goodwill for impairment. The
    goodwill impairments had no corresponding income tax benefit. 21




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ITEM 7
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  Form 10-K.
  Overview
        Executive
    Summary
  Continuing
    Operations
    book-to-bill book-to-bill quarter-to-quarter
   22




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Discontinued
    Operations
   23




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Business
    Outlook
   24




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Results
    of Operations
    Fiscal Year EndedSeptember 30,


September 27,


September 29,2009


2008


2007Net sales


100.0
%


100.0
%


100.0
%Cost of sales


60.7
%


59.4
%


57.1
%Gross profit


39.3
%


40.6
%


42.9
%Operating expenses:Selling, general and administrative


26.2
%


30.6
%


27.0
%Research and development


7.0
%


6.4
%


6.5
%Total operating expenses


33.2
%


37.0
%


33.5
%Operating income


6.1
%


3.6
%


9.4
%Interest income


0.7
%


2.8
%


4.9
%Income from continuing operations, before income taxes


6.8
%


6.4
%


14.3
%Provision for income taxes


(1.9
)%


(2.0
)%


(4.4
)%Income from continuing operations


4.9
%


4.4
%


9.9
%Discontinued operations:Loss from discontinued operations, net of tax


(0.5
)%


(8.8
)%


(4.0
)%Loss on sale of discontinued operations, net of tax


(1.0
)%


(6.2
)%


Loss from discontinued operations


(1.5
)%


(15.0
)%


(4.0
)%Net income (loss)


3.4
%


(10.6
)%


5.9
%   Fiscal
    Year ended September 30, 2009 compared to Fiscal Year ended
    September 27, 2008
  Net
    Sales
      quarter-to-quarter
  Gross
    Profit
   25




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Selling,
    General and Administrative Expenses
    s
  Research
    and Development Expenses
      Interest
    Income
    Income
    Taxes
   26




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##### Table of Contents



Fiscal
    Year ended September 27, 2008 compared to Fiscal Year ended
    September 29, 2007
  Net
    Sales
      Gross
    Profit
    Selling,
    General and Administrative Expenses
      Research
    and Development Expenses
    Interest
    Income
   27




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Income
    Taxes
    Liquidity
    and Capital Resources
               28




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Contractual
    Obligations
    Payments Due by Period as of September 30, 2009Less Than








More ThanTotal


1 Year


1 - 3 Years


3 - 5 Years


5 YearsOperating leases

$
5,352


$
879


$
1,795


$
1,882


$
796Pension funding(1)


314



314











Total Contractual Obligations

$
5,666


$
1,193


$
1,795


$
1,882


$
796     (1)
    
    We are committed to meeting the annual minimum funding
    requirements relating to our pension plan, which covers 29
    active employees at our Fort Wayne, Indiana facility. We
    contributed $0.5 million to the pension plan in fiscal year
    2009, due to the decline in market value of plan assets. We
    expect to contribute approximately $0.3 million to the plan
    during fiscal 2010. We may also make contributions to the
    pension plan in excess of the minimum funding requirements
    during any year. See Note 8 to the Consolidated Financial
    Statements for additional information regarding the pension fund.  Off-Balance
    Sheet Arrangements
  Regulation S-K.
 29




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Contingencies
    Critical
    Accounting Policies and Estimates
    Revenue
    Recognition
    Excess
    and Obsolete Inventory
    Accounts
    Receivable and Allowance for Doubtful Accounts
   30




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Defined
    Benefit Plan
    Goodwill
    and Intangible Assets
    Stock-Based
    Compensation Expense
    Product
    Warranties
    Income
    Taxes
     31




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Recent
    Accounting Pronouncements
  tm
      ITEM 7A
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK       32




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ITEM 8
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA  Regulation S-X Form 10-K.
  ITEM 9
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE    ITEM 9A
    CONTROLS
    AND PROCEDURES  Evaluation of Disclosure Controls and
    Procedures. Form 10-K Rule 13a-14
  Rules 13a-15(e) 15d-15(e)
  Changes in Internal Control over Financial
    Reporting.
  Managements Report on Internal Control over Financial
    Reporting. Rules 13a-15(f) 15d-15(f).
  Internal Control-Integrated Framework
  Form 10-K, Form 10-K.
 33




---



##### Table of Contents



ITEM 9B
    OTHER
    INFORMATION  Annual
    Salary Increases
    Name

Title

New SalaryRoger A. Derse

Vice President, Chief Financial Officer, Secretary and Treasurer

$
252,525Dan Tarantine

Executive Vice President

$
268,800
   Cash
    Bonuses
    Name

Title

BonusRoger A. Derse

Vice President, Chief Financial Officer, Secretary and Treasurer

$
30,000Dan Tarantine

Executive Vice President

$
20,000
    PART III  ITEM 10
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE  Form 10-K)
  www.whiteedc.com Form 8-K
  ITEM 11
    EXECUTIVE
    COMPENSATION    ITEM 12
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS   34




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##### Table of Contents



Equity
    Compensation Plan Information
    Number of SecuritiesRemaining AvailableNumber of Securities





for Future Issuanceto be Issued Upon


Weighted Average


Under EquityExercise of


Exercise Price of


Compensation PlansOutstanding Options


Outstanding Options


(Excluding Securitiesand Restricted Stock


and Restricted Stock


Reflected in Column (a))Plan Category

(a)


(b)


(c)Equity compensation plans approved by security holders(1)


1,461,501


$
4.62



385,374Equity compensation plans not approved by security holders(2)


450,711


$
4.50



333,788Total


1,912,212


$
4.59



719,162     (1)
    
    Equity compensation plans approved by security holders include
    the 1994 Flexible Stock Plan, as amended, the 2001 Director
    Stock Plan, the Amendment to the Companys Stock Plan for
    Non-Employee Directors and the 2006 Director Restricted
    Stock Plan.(2)
    
    Equity Compensation Plans not approved by security holders
    include the following plans:  Shokrgozar Plan  During fiscal 2000,
    the Board approved an independent grant to Mr. Shokrgozar,
    our former Chief Executive Officer and Chairman of the Board,
    for a nonqualified stock option to purchase up to
    125,000 shares of common stock at an exercise price of
    $2.75 per share, vesting over four years. At September 30,
    2009, 125,000 shares from this independent option right
    were still under option.2000 Broad Based Non-Qualified Stock
    Plan  During fiscal 2001, the Board approved
    the 2000 Broad Based Non-Qualified Stock Plan, which provides
    for the issuance of options to purchase shares of Common Stock
    at an exercise price equal to the fair market value at the date
    of grant. As of September 30, 2009, 333,788 shares
    were available for grant and 314,202 granted options were
    unexercised.IDS Plan  The Company assumed the IDS
    Stock Option Plan and 169,000 warrants with the acquisition of
    IDS in January 2003. As of September 30, 2009, 11,509
    granted options were unexercised and there were no shares
    available for grant. In addition, all warrants have been
    exercised.  ITEM 13
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE    ITEM 14
    PRINCIPAL
    ACCOUNTANT FEES AND SERVICES   35




---



##### 



PART IV  ITEM 15
    EXHIBITS AND
    FINANCIAL STATEMENT SCHEDULES  (a)(1) Financial Statements
  INDEX TO
    CONSOLIDATED FINANCIAL STATEMENTS
   
 Financial Statements

PageReport of Independent Registered Public
    Accounting Firm


41Consolidated Balance Sheets as of
    September 30, 2009 and September 27, 2008


43Consolidated Statements of Operations for the
    years ended September 30, 2009, September 27, 2008 and
    September 29, 2007


44Consolidated Statements of Shareholders
    Equity for the years ended September 30, 2009,
    September 27, 2008 and September 29, 2007


45Consolidated Statements of Cash Flows for the
    years ended September 30, 2009, September 27, 2008 and
    September 29, 2007


46Notes to Consolidated Financial Statements


47    (a)(2) Financial Statement Schedules
  INDEX TO
    FINANCIAL STATEMENT SCHEDULES
  Financial Schedule

PageSchedule II  Valuation and Qualifying Accounts
    and Reserves


71   (a)(3) Exhibits
  ExhibitNumber

Description2
.1

Agreement and Plan of Merger dated May 3, 1998 by and among
    Bowmar Instrument Corporation and Electronic Designs, Inc. and
    Bravo Acquisition Subsidiary, Inc. (incorporated herein by
    reference to Exhibit 2 on
    Form 8-K
    filed May 6, 1998).2
.2

Amendment to Agreement and Plan of Merger dated June 9,
    1998 (incorporated herein by reference to Exhibit 2.1A on
    Form S-4
    filed June 11, 1998, Registration
    No. 333-56565).2
.3

Second Amendment to Agreement and Plan of Merger dated
    August 24, 1998 (incorporated herein by reference to
    Exhibit 2.1B on
    Form S-4/A,
    filed September 2, 1998, Registration
    No. 333-56565).2
.4

Agreement and Plan of Reorganization dated as of
    January 22, 2003 by and among White Electronic Designs
    Corporation, IDS Reorganization Corp., and Interface Data
    Systems, Inc. (incorporated herein by reference to
    Exhibit 2.1 on
    Form 8-K
    filed January 24, 2003).2
.5

Agreement and Plan of Reorganization dated January 29,
    2001, by and among White Electronic Designs Corporation, PV
    Acquisition Corp., Panelview, Inc., Panelview Partners L.P.,
    Randal Barber, Gaylene Barber, Marshall R. Moran, John Cochran,
    Greyson N. Barber, and Morgan D. Barber (incorporated herein by
    reference to Exhibit 10.29 on
    Form 10-Q,
    filed February 13, 2001).2
.6

Agreement and Plan of Merger dated September 26, 2006, by
    and between Interface Data Systems, Inc. and White Electronic
    Designs Corporation (incorporated herein by reference to
    Exhibit 2.6 on
    Form 10-Q
    filed February 8, 2007).3
.1

Amended and Restated Articles of Incorporation of White
    Electronic Designs Corporation (incorporated herein by reference
    to Appendix A on Definitive Proxy Statement filed
    April 9, 2009).3
.2

Amended and Restated By-Laws of White Electronic Designs
    Corporation dated July 27, 2009 (incorporated herein by
    reference to Exhibit 3.1 on
    Form 8-K
    filed July 31, 2009). 36




---



##### Table of Contents



ExhibitNumber

Description4
.1

Shareholder Rights Agreement, dated December 6, 1996
    (incorporated herein by reference to Exhibit 5(b) on
    Form 8-K,
    filed December 19, 1996).4
.2

Amendment No. 1 to Rights Agreement, dated as of
    December 6, 1996 (incorporated herein by reference to
    Exhibit 4.3 on
    Form S-4,
    filed June 11, 1998, Registration
    No. 333-56565).4
.3

Amendment No. 2 to Rights Agreement, effective
    December 5, 2006 (incorporated herein by reference to
    Exhibit 4.3 on
    Form 10-K,
    filed December 14, 2006).10
.1

Agreement to be Bound by Registration Rights Agreements, dated
    as of May 3, 1998, by and between Bowmar Instrument
    Corporation and Electronic Designs, Inc. (incorporated herein by
    reference to Exhibit 10.1 on
    Form S-4,
    filed Jun 11, 1998, Registration
    No. 333-56565).10
.2**

Agreement to be Bound by Severance Agreements and Employment
    Agreement, dated as of May 3, 1998, by and between Bowmar
    Instrument Corporation and Electronic Designs, Inc.
    (incorporated herein by reference to Exhibit 10.2 on
    Form S-4,
    filed June 11, 1998, Registration
    No. 333-56565).10
.3**

White Electronic Designs Corporation 1994 Flexible Stock Plan
    (incorporated herein by reference to Exhibit 99 to the
    Registration Statement on
    Form S-8,
    filed May 9, 2001, Registration
    No. 333-60544).10
.4**

Amendment to the Bowmar Instrument Corporation 1994 Flexible
    Stock Plan, effective May 7, 2001 (incorporated herein by
    reference to Appendix A to the Companys definitive
    Proxy Statement prepared in connection with the 2001 Annual
    Meeting of Shareholders).10
.5

White Electronic Designs Corporation
    Rule 10b5-1
    Stock Purchase Plan, dated June 21, 2006 (incorporated
    herein by reference to Exhibit 10.3 on
    Form 10-Q,
    filed August 10, 2006).10
.6

Credit Agreement by and among White Electronic Designs
    Corporation, certain lenders named therein and JPMorgan Chase
    Bank, N.A., dated April 3, 2007 (incorporated herein by
    reference to Exhibit 10.2 on
    Form 10-Q,
    filed May 10, 2007).10
.7

First Modification Agreement to Revolving Line of Credit
    Agreement with JPMorgan Chase Bank, N.A., dated
    February 12, 2008 (incorporated herein by reference to
    Exhibit 10.7 on
    Form 10-K,
    filed December 11, 2008).10
.8

Second Modification Agreement to Revolving Line of Credit
    Agreement with JPMorgan Chase Bank, N.A., dated August 5,
    2008 (incorporated herein by reference to Exhibit 10.1 on
    Form 10-Q,
    filed August 7, 2008).10
.9

Third Modification Agreement to Revolving Line of Credit
    Agreement with JPMorgan Chase Bank, N.A., dated March 31,
    2009 (incorporated herein by reference to Exhibit 10.1 on
    Form 8-K,
    filed April 7, 2009).10
.10**

White Electronic Designs Corporation 2001 Director Stock
    Plan (incorporated herein by reference to Exhibit 99 on
    Form S-8,
    filed May 9, 2001, Registration
    No. 333-60536).10
.11**

Amendment to Bowmar Instrument Corporation Stock Option Plan for
    Non-Employee Directors (incorporated herein by reference to
    Appendix D to the Companys definitive Proxy Statement
    in connection with the 2001 Annual Meeting of Shareholders).10
.12**

White Electronic Designs Corporation Stock Option Plan for
    Non-Employee Directors (incorporated herein by reference to
    Exhibit 99 on
    Form S-8,
    filed May 9, 2001, Registration
    No. 333-60548).10
.13**

White Electronic Designs Corporation 2000 Broad Based Employee
    Stock Option Plan (incorporated herein by reference to
    Exhibit 99 on
    Form S-8,
    filed May 9, 2001, Registration
    No. 333-60542).10
.14**

Severance Agreement and Release of Claims, dated August 28,
    2008, between White Electronic Designs Corporation and Hamid R.
    Shokrgozar (incorporated herein by reference to
    Exhibit 10.1 on
    Form 8-K,
    filed August 29, 2008).10
.15**

Non-Qualified Stock Option Agreement between White Electronic
    Designs Corporation and Hamid Shokrgozar dated November 10,
    1999 (incorporated herein by reference to Exhibit 10.42 on
    Form 10-K
    filed on December 23, 2002). 37




---



##### Table of Contents



ExhibitNumber

Description10
.16

Industrial Real Estate Lease dated February 4, 1997 between
    Bowmar Instrument Corp., as tenant, and Allred Phoenix
    Properties, L.L.C., as landlord (incorporated herein by
    reference to Exhibit 10.5 on
    Form 10-K
    filed December 29, 2007).10
.17

First Amendment to certain Industrial Real Estate Lease dated
    February 4, 1997 between White Electronic Designs
    Corporation (as successor  in  interest of
    Bowmar Instrument Corp.) and Gus Enterprises  XII,
    L.L.C. (as successor  in  interest of
    Allred Phoenix Properties, L.L.C.) dated November 5, 2004
    (incorporated herein by reference to Exhibit 10.21 on
    Form 10-K
    filed on December 16, 2004).10
.18**

White Electronic Designs Corporation 2006 Director
    Restricted Stock Plan, effective March 24, 2006
    (incorporated by reference to Appendix A to the
    Companys definitive Proxy Statement in connection with the
    2006 Annual Meeting of Shareholders).10
.19**

First Amendment to 2006 Director Restricted Stock Plan,
    effective August 24, 2006 (incorporated by reference to
    Exhibit 99.1 on
    Form 8-K,
    filed August 30, 2006).10
.20**

Form of Restricted Stock Agreement to 2006 Director
    Restricted Stock Plan, effective August 24, 2006
    (incorporated by reference to Exhibit 99.2 on
    Form 8-K,
    filed on August 30, 2006).10
.21**

Change of Control Agreement between Dan V. Tarantine and White
    Electronic Designs Corporation, effective December 13, 2006
    (incorporated herein by reference to Exhibit 10.26 on
    Form 10-K,
    filed December 14, 2006).10
.22**

Change of Control Agreement between Roger A. Derse and White
    Electronic Designs Corporation, effective December 13, 2006
    (incorporated herein by reference to Exhibit 10.27 on
    Form 10-K,
    filed December 14, 2006).10
.23**

Form of Restricted Stock Units Award Agreement under the 1994
    Flexible Stock Plan (incorporated herein by reference to
    Exhibit 10.19 on
    Form 10-K,
    filed December 13, 2007).10
.24**

Form of Performance Share Award Agreement under the 1994
    Flexible Stock Plan (incorporated herein by reference to
    Exhibit 10.20 on
    Form 10-K,
    filed December 13, 2007).10
.25**

Employment Agreement dated January 21, 2009, between White
    Electronic Designs Corporation and Roger A. Derse (incorporated
    herein by reference to Exhibit 10.24 on
    Form 10-K/A
    filed January 26, 2009).10
.26**

Employment Agreement dated January 21, 2009, between White
    Electronic Designs Corporation and Dan V. Tarantine
    (incorporated herein by reference to Exhibit 10.25 on
    Form 10-K/A
    filed January 26, 2009).10
.27**

Employment Agreement dated August 12, 2009, by and between
    White Electronic Designs Corporation and Gerald R. Dinkel
    (incorporated herein by reference to Exhibit 10.1 on
    Form 8-K
    filed August 13, 2009).10
.28

Shareholder Agreement dated February 4, 2009, by and among
    White Electronic Designs Corporation, Wynnefield Partners Small
    Cap Value, L.P. (and its affiliates), Caiman Partners, L.P. (and
    its affiliates), Kahn Capital Management LLC, Jack A. Henry,
    Paul D. Quadros, Thomas M. Reahard, Thomas J. Toy and Edward A.
    White (incorporated herein by reference to Exhibit 10.1 on
    Form 8-K
    filed February 11, 2009).10
.29

Amendment No. 1 to Shareholder Agreement dated
    August 13, 2009, by and among White Electronic Designs
    Corporation, Wynnefield Partners Small Cap Value, L.P. (and its
    affiliates), Caiman Partners, L.P. (and its affiliates), Kahn
    Capital Management LLC, Jack A. Henry, Paul D. Quadros, Thomas
    R. Reahard, Thomas J. Toy and Edward A. White (incorporated
    herein by reference to Exhibit 10.1 on
    Form 8-K
    filed August 14, 2009).10
.30

Amendment No. 2 to Shareholder Agreement dated
    November 16, 2009, by and among White Electronic Designs
    Corporation, Wynnefield Partners Small Cap Value, L.P. (and its
    affiliates), Caiman Partners, L.P. (and its affiliates), Kahn
    Capital Management LLC, Jack A. Henry, Paul D. Quadros, Thomas
    R. Reahard, Thomas J. Toy and Edward A. White (incorporated
    herein by reference to Exhibit 10.1 on
    Form 8-K
    filed November 17, 2009). 38




---



##### Table of Contents



ExhibitNumber

Description10
.31

Asset Purchase Agreement dated April 3, 2009, by and among
    White Electronic Designs Corporation, Panelview, Incorporated
    and VIA optronics GmbH and VIA optronics, LLC (incorporated
    herein by reference to Exhibit 10.1 on
    Form 8-K
    filed April 8, 2009).10
.32

Severance Agreement dated June 16, 2009 by and between
    Edward A. White and White Electronic Designs Corporation
    (incorporated herein by reference to Exhibit 10.1 on
    Form 8-K
    filed June 17, 2009).21
.1*

Subsidiaries of White Electronic Designs Corporation.23
.1*

Consent of Grant Thornton LLP.31
.1*

Certification Pursuant to Section 302 of the Sarbanes-Oxley
    Act of 2002.31
.2*

Certification Pursuant to Section 302 of the Sarbanes-Oxley
    Act of 2002.32
.1##

Certification Pursuant to 18 U.S. C. Section 1350, As
    Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act
    of 2002.32
.2##

Certification Pursuant to 18 U.S. C. Section 1350, As
    Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act
    of 2002.     *
    
    Filed herewith.**
    
    Management compensatory contract, plan or arrangement.##
    
    Furnished herewith. 39




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##### Table of Contents



SIGNATURES       /s/  Gerald
    R.
    Dinkel

/s/  Roger
    A.
    DerseGerald R. Dinkel
    President and Chief Executive Officer

Roger A. Derse
    Chief Financial Officer, Secretary and TreasurerDate: December 11, 2009

Date: December 11, 2009     /s/  Brian
    R.
    Kahn

/s/  Kenneth
    J.
    KriegBrian R. Kahn
    Chairman of the Board of Directors

Kenneth J. Krieg
    DirectorDate: December 11, 2009

Date: December 11, 2009/s/  Jack
    A.
    Henry

/s/  Paul
    D.
    QuadrosJack A. Henry
    Director

Paul D. Quadros
    DirectorDate: December 11, 2009

Date: December 11, 2009/s/  Melvin
    L.
    Keating

/s/  Thomas
    J.
    ToyMelvin L. Keating
    Director

Thomas J. Toy
    DirectorDate: December 11, 2009

Date: December 11, 2009  40




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM     Internal Control  Integrated
    Framework
         41




---



##### Table of Contents



Internal Control  Integrated Framework
  GRANT
    THORNTON LLP
   42




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##### Table of Contents



WHITE
    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS
  September 30,


September 27,2009


2008(In thousands, exceptshare data)ASSETSCurrent AssetsCash and cash equivalents

$
64,170


$
52,604Accounts receivable, less allowance for doubtful accounts of $47
    and $74


10,136



10,508Inventories


15,642



15,359Prepaid expenses and other current assets


3,607



2,027Deferred income taxes


2,464



2,962Assets held for sale


174



12,668Total Current Assets


96,193



96,128Property, plant and equipment, net


11,677



10,137Deferred income taxes


1,100



1,900Goodwill


1,764



1,764Other assets


67



67Assets held for sale


796



1,662Total Assets

$
111,597


$
111,658LIABILITIES AND SHAREHOLDERS EQUITYCurrent LiabilitiesAccounts payable

$
3,823


$
2,038Accrued salaries and benefits


1,874



1,490Other accrued expenses


1,546



1,260Deferred revenue


923



4,016Liabilities related to assets held for sale


352



2,327Total Current Liabilities


8,518



11,131Accrued pension liability


434



640Other liabilities


755



948Liabilities related to assets held for sale






101Total Liabilities


9,707



12,820Commitments and ContingenciesShareholders EquityPreferred stock, 1,000,000 shares authorized, no shares
    issued






Common stock, $0.10 stated value, 60,000,000 shares
    authorized, 25,464,726 and 25,048,639 shares issued


2,546



2,504Treasury stock, 2,464,371 and 2,464,371 shares, at par


(247
)


(247
)Additional paid-in capital


83,686



82,608Retained earnings


16,270



14,241Accumulated other comprehensive loss


(365
)


(268
)Total Shareholders Equity


101,890



98,838Total Liabilities and Shareholders Equity

$
111,597


$
111,658    43




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##### Table of Contents



WHITE
    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS
  Year EndedSeptember 30,


September 27,


September 29,2009


2008


2007(In thousands, except share and per share data)Net sales

$
62,559


$
56,355


$
52,073Cost of sales


37,993



33,458



29,708Gross profit


24,566



22,897



22,365Operating expenses:Selling, general and administrative


16,385



17,250



14,034Research and development


4,408



3,611



3,406Total operating expenses


20,793



20,861



17,440Operating income


3,773



2,036



4,925Interest income


441



1,585



2,540Income from continuing operations before income taxes


4,214



3,621



7,465Provision for income taxes


(1,218
)


(1,138
)


(2,292
)Income from continuing operations


2,996



2,483



5,173Discontinued operations (Note 13):Loss from discontinued operations, net of tax


(344
)


(4,955
)


(2,087
)Loss on sale of discontinued operations, net of tax


(623
)


(3,515
)


Loss from discontinued operations


(967
)


(8,470
)


(2,087
)Net income (loss)

$
2,029


$
(5,987
)

$
3,086Income from continuing operations per common share:Basic

$
0.13


$
0.11


$
0.22Diluted

$
0.13


$
0.11


$
0.21Loss from discontinued operations per common share:Basic

$
(0.04
)

$
(0.38
)

$
(0.09
)Diluted

$
(0.04
)

$
(0.37
)

$
(0.09
)Net income (loss) per common share:Basic

$
0.09


$
(0.27
)

$
0.13Diluted

$
0.09


$
(0.26
)

$
0.13Weighted average number of common shares and equivalents:Basic


22,875,371



22,509,796



23,574,852Diluted


23,121,614



23,042,748



24,107,677    44




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##### Table of Contents



WHITE
    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF SHAREHOLDERS
    EQUITY
  AccumulatedAdditional





Other


TotalCommon Stock


Treasury


Paid-in


Retained


Comprehensive


ShareholdersShares


Amount


Stock


Capital


Earnings


Income (Loss)


Equity(In thousands of dollars, except share data)Balance, September 30, 2006


24,666,390


$
2,467


$
(29
)

$
90,637


$
17,142


$
(37
)

$
110,180Net income


















3,086







3,086Comprehensive income


























3,086Stock options and warrants exercised


162,696



16







431











447Restricted stock vested


12,500



1







(1
)










Stock-based compensation expense














397











397Common stock repurchased through common stock purchase plan










(154
)


(7,887
)










(8,041
)Tax benefits related to exercise of stock options and warrants














210











210Adjustment to initially adopt SFAS 158, net of tax






















93



93Balance, September 29, 2007


24,841,586



2,484



(183
)


83,787



20,228



56



106,372Net loss


















(5,987
)






(5,987
)Defined benefit pension plan:Net loss, net of tax






















(102
)


(102
)Net prior service cost, net of tax






















(222
)


(222
)Comprehensive loss


























(6,311
)Stock options exercised


82,053



7







285











292Restricted stock vested


125,000



13







(13
)










Stock-based compensation expense














1,682











1,682Common stock repurchased through common stock purchase plan










(64
)


(3,158
)










(3,222
)Tax benefits related to exercise of stock options














25











25Balance, September 27, 2008


25,048,639



2,504



(247
)


82,608



14,241



(268
)


98,838Net income


















2,029







2,029Defined benefit pension plan:Net loss, net of tax






















(139
)


(139
)Net prior service cost, net of tax






















42



42Comprehensive income


























1,932Stock options exercised


338,587



34







518











552Restricted stock vested


77,500



8







(8
)










Stock-based compensation expense














388











388Tax benefits related to exercise of stock options














180











180Balance, September 30, 2009


25,464,726


$
2,546


$
(247
)

$
83,686


$
16,270


$
(365
)

$
101,890    45




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##### Table of Contents



WHITE
    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS
  Year EndedSeptember 30,


September 27,


September 29,2009


2008


2007(In thousands)OPERATING ACTIVITIES:Income from continuing operations

$
2,996


$
2,483


$
5,173Adjustments to reconcile income from continuing operations to
    net cash provided by operating activities:Depreciation


2,775



2,498



2,284Deferred income tax


1,381



(330
)


(229
)Loss on disposition of property, plant and equipment


7



99



26Stock-based compensation expense related to employee stock awards


388



1,682



397Tax benefit related to exercise of stock awards


180



25



210Excess tax benefits from stock-based compensation


(222
)


(16
)


(56
)Pension costs


(386
)


45



Net changes in balance sheet accounts:Accounts receivable


372



(376
)


(2,091
)Inventories


(283
)


(341
)


(3,971
)Prepaid expenses and other current assets


(1,580
)


(1,380
)


5,710Accounts payable


1,639



437



(801
)Accrued expenses and deferred revenue


(2,423
)


(1,146
)


(2,251
)Other long-term liabilities


(193
)


(142
)


(127
)Net cash provided by operating activities


4,651



3,538



4,274INVESTING ACTIVITIES:Acquisition of property, plant and equipment


(4,151
)


(2,980
)


(2,083
)Proceeds from disposition of property, plant, and equipment


5



10



Net cash used in investing activities


(4,146
)


(2,970
)


(2,083
)FINANCING ACTIVITIES:Common stock issued for exercise of options, warrants and
    restricted stock


552



292



447Repurchase of common stock






(3,222
)


(8,041
)Excess tax benefits from stock-based compensation


222



16



56Net cash provided by (used in) financing activities


774



(2,914
)


(7,538
)Net change in cash and cash equivalents from continuing
    operations


1,279



(2,346
)


(5,347
)CASH FLOWS FROM DISCONTINUED OPERATIONS:Net cash provided by (used in) operating activities


7,413



6,558



(3,345
)Net cash provided by (used in) investing activities


2,874



(260
)


1,515Net change in cash and cash equivalents from discontinued
    operations


10,287



6,298



(1,830
)Net change in cash and cash equivalents


11,566



3,952



(7,177
)Cash and cash equivalents at beginning of year


52,604



48,652



55,829Cash and cash equivalents at end of year

$
64,170


$
52,604


$
48,652SUPPLEMENTAL CASH FLOW INFORMATION:Cash paid for income taxes

$
19


$
3,081


$
1,018SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING
    ACTIVITIES:Acquisition of property, plant and equipment in accounts payable

$
146


$
59


$
131    46




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    NATURE OF
    OPERATIONS    2.
    SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES  a.
    Principles
    of Consolidation    b.
    Fiscal
    Year-End    c.
    Accounting
    Estimates    d.
    Cash
    and Cash Equivalents    e.
    Accounts
    Receivable   47




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  f.
    Inventories    g.
    Property,
    Plant and Equipment    h.
    Goodwill        i.
    Product
    Warranties    j.
    Revenue
    Recognition   48




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    k.
    Shipping
    Costs    l.
    Research
    and Development    m.
    Income
    Taxes    n.
    Fair
    Value of Financial Instruments    o.
    Earnings
    (Loss) per Share   49




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Fiscal Year EndedSeptember 30,


September 27,


September 29,2009


2008


2007Income from continuing operations

$
2,996,000


$
2,483,000


$
5,173,000Loss from discontinued operations


(967,000
)


(8,470,000
)


(2,087,000
)Net income (loss)

$
2,029,000


$
(5,987,000
)

$
3,086,000Weighted average common shares outstanding  basic
    shares


22,875,371



22,509,796



23,574,852Dilutive effect of stock options and restricted stock(1)


246,243



532,952



532,825Weighted average common and common share equivalents
    outstanding  diluted shares


23,121,614



23,042,748



24,107,677Basic EPSIncome per share from continuing operations

$
0.13


$
0.11


$
0.22Loss per share from discontinued operations

$
(0.04
)

$
(0.38
)

$
(0.09
)Net income (loss) per share

$
0.09


$
(0.27
)

$
0.13Diluted EPSIncome per share from continuing operations

$
0.13


$
0.11


$
0.21Loss per share from discontinued operations

$
(0.04
)

$
(0.37
)

$
(0.09
)Net income (loss) per share

$
0.09


$
(0.26
)

$
0.13     (1)
    
    Shares excluded from the calculation of diluted earnings per
    share were 840,360, 933,264 and 807,389 for the fiscal years
    ended September 30, 2009, September 27, 2008 and
    September 29, 2007, respectively, as the exercise prices
    were greater than the average share prices for the periods.  p.
    Stock-Based
    Compensation  Stock
    Options
     50




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Options OutstandingOptions





WeightedAvailable





Averagefor


Options


Exercise PriceGrant


Outstanding


per ShareBalance at September 27, 2008


723



2,051


$
4.84Granted


(200
)


200


$
4.05Other Grants(1)


(168
)





$
Exercised






(339
)

$
1.63Canceled(2)


75



(80
)

$
6.40Expired(3)


91



(102
)

$
6.97Forfeited


38



(38
)

$
4.91Other Forfeitures(1)


123






$
Balance at September 30, 2009


682



1,692


$
5.19       (1)
    
    Certain restricted stock units and performance shares were
    granted under the 1994 Employee Stock Option Plan (1994
    Option Plan) during the period. Of these grants,
    130,000 shares were granted as restricted stock and
    37,500 shares were granted as performance shares. In
    addition, 122,500 performance shares granted under the 1994
    Option Plan were forfeited. This activity serves to
    increase/decrease the number of shares available for grant, but
    is not presented as stock option activity. Refer to the sections
    Restricted Stock and Performance Shares
    for more information.(2)
    
    5,000 of the 80,000 canceled shares were associated with an
    expired stock option plan and therefore were not added back to
    options available for grant.(3)
    
    11,000 of the 102,000 expired shares were associated with an
    expired stock option plan and therefore were not added back to
    options available for grant.         51




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Fiscal Years EndingSeptember 30,


September 27,


September 29,2009


2008


2007Expected options term (years)


4.8



6.7



5.1Risk free interest rate


2.7
%


3.4
%


4.3
%Volatility


36
%


47
%


52
%Dividend yield


0
%


0
%


0
%     Restricted
    Stock
    Number of


Weighted-Restricted


AverageStock


Grant-DateUnits


Fair ValueOutstanding on September 27, 2008


100


$
5.08Granted


212


$
3.70Vested/Issued


(77
)

$
4.87Forfeited


(15
)

$
4.66Outstanding on September 30, 2009


220


$
3.85       Performance
    Shares
    Weighted-Number of


AveragePerformance


Grant-DateShares


Fair ValueOutstanding on September 27, 2008


85


$
4.64Granted


38


$
3.80Vested/Issued





$
Forfeited


(123
)

$
4.38Outstanding on September 30, 2009





$
  52




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    q.
    Newly
    Issued Accounting Standards  tm
      3.
    INVENTORIES    September 30,


September 27,2009


2008Raw materials

$
9,719


$
10,129Work-in-process


4,444



4,380Finished goods


1,479



850Total inventories

$
15,642


$
15,359  53




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    4.
    PROPERTY,
    PLANT AND EQUIPMENT, NET    September 30,


September 27,2009


2008Land

$
247


$
247Buildings and improvements


1,006



828Machinery and equipment


14,636



12,987Furniture and fixtures


4,794



3,792Leasehold improvements


7,337



6,735Construction in progress


1,168



331Total, at cost


29,188



24,920Less accumulated depreciation


(17,511
)


(14,783
)Property, plant and equipment, net

$
11,677


$
10,137     5.
    OTHER
    ACCRUED EXPENSES    September 30,


September 27,2009


2008Sales commissions

$
431


$
469Warranty reserve


296



42Other accruals


819



749Total other accrued expenses

$
1,546


$
1,260    54




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Warranty reserve at September 30, 2006

$
48Provision for warranty claims


18Warranty claims charged against the reserve


(5
)Warranty reserve at September 29, 2007


61Provision for warranty claims


30Warranty claims charged against the reserve


(49
)Warranty reserve at September 27, 2008


42Provision for warranty claims


17Reclassification from discontinued to continuing operations (see
    Note 13)


309Warranty claims charged against the reserve


(72
)Warranty reserve at September 30, 2009

$
296   6.
    LINE OF
    CREDIT    7.
    INCOME
    TAXES    2009


2008


2007CurrentFederal

$
(140
)

$
1,296


$
2,322State


(55
)


72



223Total current


(195
)


1,368



2,545DeferredFederal


1,364



59



(85
)State


49



(289
)


(168
)Total deferred


1,413



(230
)


(253
)Income tax provision from continuing operations

$
1,218


$
1,138


$
2,292  55




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2009


2008


2007Continuing operations

$
1,218


$
1,138


$
2,292Discontinued operations


(246
)


(3,030
)


(1,722
)Total income tax expense (benefit)

$
972


$
(1,892
)

$
570     2009


2008


2007Income tax provision at statutory rate

$
1,433


$
1,229


$
2,540State taxes, net of federal benefit


114



111



343Federal and state credits


(273
)


(204
)


(340
)Extraterritorial income exclusion










(17
)NOL expiration


61







Manufacturers deduction










(114
)Reserve release


(168
)






Adjustments related to prior year accruals






(114
)


(172
)Other


51



116



52Income tax provision

$
1,218


$
1,138


$
2,292     September 30,


September 27,2009


2008Deferred tax assets:Tax credits

$
700


$
452Allowance for doubtful accounts


17



27Inventories


1,263



903Deferred revenue


338



1,486Accrued expenses and other liabilities


1,084



1,072Pension


161



132Net operating loss carry forwards


400



596Contribution carryforward


9



Property, plant, and equipment






399Deferred tax assets


3,972



5,067Deferred tax liabilities:Property, plant, and equipment


(243
)


(46
)Intangible assets


(6
)


(6
)Other


(159
)


(153
)Deferred tax liabilities


(408
)


(205
)Net deferred tax assets

$
3,564


$
4,862  56




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
                September 30,


September 27,2009


2008Balance at beginning of year

$
424


$
506Additions based on tax positions related to the current year


88



58Additions for tax positions of prior years






Reductions for tax positions of prior years


(2
)


Reductions for tax positions due to lapse of statutes of
    limitations or close of audit


(179
)


(140
)Settlements






Balance at end of year

$
331


$
424    57




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   8.
    BENEFIT
    PLANS  Defined
    Benefit Plan
    year-by-year
     58




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    September 30,


September 27,2009


2008Change in Benefit ObligationBenefit obligation at beginning of year

$
3,207


$
3,298Service cost


54



51Interest cost


236



206Amendments






114Actuarial gain (loss)


648



(259
)Benefits paid


(238
)


(203
)Benefit obligation at end of year

$
3,907


$
3,207Change in Plan AssetsFair value of plan assets at beginning of year

$
2,567


$
3,027Actual return on plan assets


595



(362
)Employer contributions prior to measurement date


549



105Benefits paid


(238
)


(203
)Fair value of plan assets at end of year

$
3,473


$
2,567Funded Status

$
(434
)

$
(640
)Amounts Recognized in the Consolidated Balance SheetsNoncurrent liabilities

$
(434
)

$
(640
)Amounts Recognized in Accumulated Other Comprehensive Income
    (Loss)Net loss

$
355


$
126Prior service cost


225



274Total (before tax)

$
580


$
400    59




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Fiscal Year Ended2009


2008


2007Net periodic benefit costService cost

$
64


$
61


$
81Interest cost


236



206



189Expected return on plan assets


(186
)


(209
)


(194
)Amortization of prior service cost


49



49



36Net periodic benefit cost

$
163


$
107


$
112Additional InformationIncrease (decrease) in minimum liability included in accumulated
    other comprehensive loss

$



$
126


$
(58
)       September 30,

September 27,

September 29,2009

2008

2007Discount Rate


7.31
%


6.11
%


5.89
%Expected return on plan assets


7.00
%


7.00
%


7.00
%          60




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      2009


2008Cash and cash equivalents

$



$
103Fixed income mutual funds


1,530



1,092Equity mutual funds


1,943



1,365Other






7Total

$
3,473


$
2,567           PensionPeriod

Benefits2010

$
2402011

$
2452012

$
2672013

$
2632014

$
2892015-2019

$
1,577    61




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    401(k)
    Plan
    9.
    STOCK
    OPTIONS, WARRANTS, AND STOCK PURCHASE PLANS  Stock
    Option Plans
    paid-in-capital
    2009


2008


2007Weighted





Weighted





WeightedShares


Average


Shares


Average


Shares


AverageUnder


Exercise


Under


Exercise


Under


ExerciseOption


Price


Option


Price


Option


PriceBeginning balance outstanding


2,051


$
4.84



2,198


$
4.86



2,235


$
4.80Granted


200


$
4.05



210


$
6.51



32


$
5.64Exercised


(339
)

$
1.63



(82
)

$
3.57



(43
)

$
2.17Canceled


(80
)

$
6.40






$







$
Expired


(102
)

$
6.97



(209
)

$
7.13



(9
)

$
5.93Forfeited


(38
)

$
4.91



(66
)

$
4.94



(17
)

$
5.07Ending balance outstanding


1,692


$
5.19



2,051


$
4.84



2,198


$
4.86Options exercisable at year end


1,471


$
5.35



1,952


$
4.85



2,028


$
4.85Shares available for future grant


682







723







868Weighted average fair value of all options granted during the
    year





$
1.44






$
1.06






$
2.96  62




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Options Outstanding


Options ExercisableWeighted-


Weighted-








Weighted-


Weighted-Average


Average








Average


AverageRemaining


Exercise


Aggregate





Remaining


Exercise


AggregateRange of

Number


Contractual


Price per


Intrinsic


Number


Contractual


Price per


IntrinsicExercise Prices

Outstanding


Life (in Years)


Share


Value


Exercisable


Life (in Years)


Share


Value$  1.6001 - $  3.2000


280



0.12


$
2.75







280






$
2.75$  3.2001 - $  4.8000


665



4.71


$
4.02







444






$
3.96$  4.8001 - $  6.4000


157



3.68


$
5.85







157






$
5.85$  6.4001 - $  8.0000


483



3.49


$
6.97







483






$
6.97$  8.0001 - $  9.6000


40



2.54


$
8.66







40






$
8.66$  9.6001 - $11.2000


65



0.85


$
10.59







65






$
10.59$11.2001 - $12.8000


2



3.91


$
12.19







2






$
12.19Total


1,692



3.30


$
5.19


$
932



1,471



2.36


$
5.35


$
820   in-the-money in-the-money
  Restricted
    Stock
         63




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Performance
    Shares
       64




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Severance
    Agreement
    
    The Company paid Mr. Shokrgozar a lump-sum $1,600,000
    severance payment, plus any accrued and unused vacation pay less
    required withholdings;
    The Company shall pay for eighteen (18) months of the
    Companys portion of Mr. Shokrgozars COBRA
    premium. Following such period, until December 13, 2010,
    the Company shall pay Mr. Shokrgozar an amount equal to the
    Companys portion of Mr. Shokrgozars COBRA
    premium in order for Mr. Shokrgozar to secure health
    insurance of his choice; provided that such payments shall cease
    if, during the COBRA period or thereafter, Mr. Shokrgozar
    is then covered by reasonably equivalent or superior health
    insurance provided by any subsequent employer. In addition, the
    Company shall continue to provide Mr. Shokrgozar with up to
    $4,000 per year for unreimbursed medical expenses and with the
    auto allowance and the disability and life benefits he was
    receiving from the Company as of the termination date until
    December 13, 2010;
    The Company reimbursed Mr. Shokrgozar for reasonable
    attorneys fees incurred in connection with the Severance
    Agreement, in the maximum amount of $50,000 and the Company will
    provide outplacement services for Mr. Shokrgozar for a
    period not to exceed 18 months in the maximum amount of
    $50,000;
    The Company and Mr. Shokrgozar agreed to the following
    concerning outstanding grants of stock options, RSUs and
    performance shares:  
    The following vested stock options: (i) 125,000 shares
    granted on November 10, 1999; (ii) 125,000 shares
    granted on November 10, 1999;
    (iii) 150,000 shares granted on May 16, 2001 and
    (iv) 150,000 shares granted on December 15, 2004
    will terminate, if not exercised, on their respective expiration
    dates (i.e., November 10, 2009, November 10, 2009,
    May 16, 2011, and December 15, 2014, respectively);
    The vested stock options to acquire 150,000 shares granted
    on December 3, 1998 terminated, as they were not exercised
    on the 90th day following the termination date;
    The vested stock options to acquire 150,000 shares granted
    on November 30, 2000 terminated on August 28, 2008;
    The Company granted to Mr. Shokrgozar an option to acquire
    150,000 shares of the Companys Common Stock at an
    exercise price of $7.25 per share, an expiration date of
    November 30, 2010, and with such other terms as are
    contained in the Companys standard form of option
    agreement;
    The 50,000 shares of restricted stock granted to
    Mr. Shokrgozar pursuant to that certain Restricted Stock
    Units Award Agreement dated December 12, 2007 vested on
    September 5, 2008;
    One-half (50,000 shares) of the performance shares granted
    to Mr. Shokrgozar pursuant to that certain Performance
    Share Award Agreement dated December 12, 2007 vested on
    September 5, 2008;


    One-half (50,000 shares) of the performance shares granted
    to Mr. Shokrgozar pursuant to that certain Performance
    Share Award Agreement dated December 12, 2007 were
    forfeited as the Companys EBITDA for the fiscal year ended
    in 2009 did not equal or exceed $9,960,000; and
    Any other unvested right to receive Company stock terminated on
    August 28, 2008. 65




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   10.
    COMMITMENTS
    AND CONTINGENCIES        11.
    CONCENTRATIONS
    OF CREDIT RISK      12.
    SHAREHOLDERS
    RIGHTS PLAN    13.
    DISCONTINUED
    OPERATIONS   66




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
           67




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year EndedSeptember 30,


September 27,


September 29,2009


2008


2007Net sales

$
14,369


$
40,062


$
52,166Cost of sales


11,143



34,620



43,612Gross profit


3,226



5,442



8,554Total operating expenses


3,461



11,384



12,363Loss from operations before income taxes


(235
)


(5,942
)


(3,809
)Benefit from (provision for) income taxes


(109
)


987



1,722Loss from discontinued operations, net of tax


(344
)


(4,955
)


(2,087
)Loss on sale of discontinued operations, net of tax


(623
)


(3,515
)


Loss from discontinued operations

$
(967
)

$
(8,470
)

$
(2,087
)     September 30,


September 27,2009


2008Assets held for sale (current):Accounts receivable, net

$
174


$
5,618Inventories






4,607Deferred income taxes and prepaid expenses






2,443Total

$
174


$
12,668Assets held for sale (long-term):Property, plant and equipment, net

$
486


$
1,326Deferred income taxes


310



286Other assets






50Total

$
796


$
1,662Liabilities related to assets held for sale (current):Accounts payable

$
26


$
1,418Accrued expenses


317



856Deferred income taxes


9



Deferred revenue






53Total

$
352


$
2,327Liabilities related to assets held for sale (long-term):Deferred income taxes

$



$
32Other long-term liabilities






69Total

$



$
101  68




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    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   14.
    GEOGRAPHICAL
    INFORMATION    2009


2008


2007United States of America

$
43,091


$
39,728


$
33,899Europe and Middle East


12,240



8,457



9,279Asia Pacific


6,338



6,544



7,473Other


890



1,626



1,422Total Net Sales

$
62,559


$
56,355


$
52,073   15.
    SELECTED
    QUARTERLY FINANCIAL DATA (UNAUDITED)  Fiscal 2009Year


Sep 30


Jul 4


Apr 4


Jan 3(In thousand of dollars, except per share data)Net sales

$
62,559


$
15,524


$
16,620


$
17,120


$
13,295Gross profit

$
24,566


$
5,822


$
6,148


$
7,293


$
5,303Income from continuing operations before income taxes

$
4,214


$
1,079


$
757


$
1,735


$
643Income from continuing operations

$
2,996


$
1,000


$
350


$
1,153


$
493Income (loss) from discontinued operations


(967
)


(157
)


(126
)


(1,017
)


333Net income

$
2,029


$
843


$
224


$
136


$
826Income from continuing operations per common share:Basic

$
0.13


$
0.04


$
0.02


$
0.05


$
0.02Diluted

$
0.13


$
0.04


$
0.02


$
0.05


$
0.02Income (loss) from discontinued operations per common share:Basic

$
(0.04
)

$
(0.01
)

$
(0.01
)

$
(0.04
)

$
0.01Diluted

$
(0.04
)

$
(0.01
)

$
(0.01
)

$
(0.04
)

$
0.01Net income per common share:Basic

$
0.09


$
0.04


$
0.01


$
0.01


$
0.04Diluted

$
0.09


$
0.04


$
0.01


$
0.01


$
0.04   69




---



##### Table of Contents



WHITE
    ELECTRONIC DESIGNS CORPORATION AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Fiscal 2008Year


Sep 27


Jun 28


Mar 29


Dec 29(In thousand of dollars, except per share data)Net sales

$
56,355


$
14,855


$
14,807


$
14,605


$
12,088Gross profit

$
22,897


$
6,008


$
6,450


$
5,927


$
4,512Income (loss) from continuing operations before income taxes

$
3,621


$
(1,189
)

$
2,165


$
1,973


$
672Income (loss) from continuing operations

$
2,483


$
(1,094
)

$
1,698


$
1,323


$
556Loss from discontinued operations


(8,470
)


(1,536
)


(3,727
)


(2,890
)


(317
)Net income (loss)

$
(5,987
)

$
(2,630
)

$
(2,029
)

$
(1,567
)

$
239Income (loss) from continuing operations per common share:Basic

$
0.11


$
(0.05
)

$
0.08


$
0.06


$
0.02Diluted

$
0.11


$
(0.05
)

$
0.07


$
0.06


$
0.02Loss from discontinued operations per common share:Basic

$
(0.38
)

$
(0.07
)

$
(0.17
)

$
(0.13
)

$
(0.01
)Diluted

$
(0.37
)

$
(0.07
)

$
(0.16
)

$
(0.13
)

$
(0.01
)Net income (loss) per common share:Basic

$
(0.27
)

$
(0.12
)

$
(0.09
)

$
(0.07
)

$
0.01Diluted

$
(0.26
)

$
(0.12
)

$
(0.09
)

$
(0.07
)

$
0.01  70




---



##### Table of Contents



Schedule II
  White
    Electronic Designs Corporation and Subsidiaries
    Valuation and Qualifying Accounts and Reserves
    Charged/

ReclassificationBalance at

(Credited)

from Discontinued



BalanceBeginning

to Costs and

to Continuing



at EndFiscal Year Ended

of Period

Expenses

Operations

Deductions

of PeriodAccounts ReceivableSeptember 30, 2009

$
74


$
(79
)

$
137


$
(85
)

$
47September 27, 2008

$
46


$
28


$



$



$
74September 29, 2007

$
52


$
(5
)

$



$
(1
)

$
46  71




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##### Table of Contents



EXHIBIT INDEX
  ExhibitNumber

Description2
.1

Agreement and Plan of Merger dated May 3, 1998 by and among
    Bowmar Instrument Corporation and Electronic Designs, Inc. and
    Bravo Acquisition Subsidiary, Inc. (incorporated herein by
    reference to Exhibit 2 on Form 8-K filed May 6, 1998).2
.2

Amendment to Agreement and Plan of Merger dated June 9, 1998
    (incorporated herein by reference to Exhibit 2.1A on Form S-4
    filed June 11, 1998, Registration No. 333-56565).2
.3

Second Amendment to Agreement and Plan of Merger dated August
    24, 1998 (incorporated herein by reference to Exhibit 2.1B on
    Form S-4/A, filed September 2, 1998, Registration No. 333-56565).2
.4

Agreement and Plan of Reorganization dated as of January 22,
    2003 by and among White Electronic Designs Corporation, IDS
    Reorganization Corp., and Interface Data Systems, Inc.
    (incorporated herein by reference to Exhibit 2.1 on Form 8-K
    filed January 24, 2003).2
.5

Agreement and Plan of Reorganization dated January 29, 2001, by
    and among White Electronic Designs Corporation, PV Acquisition
    Corp., Panelview, Inc., Panelview Partners L.P., Randal Barber,
    Gaylene Barber, Marshall R. Moran, John Cochran, Greyson N.
    Barber, and Morgan D. Barber (incorporated herein by reference
    to Exhibit 10.29 on Form 10-Q, filed February 13, 2001).2
.6

Agreement and Plan of Merger dated September 26, 2006, by and
    between Interface Data Systems, Inc. and White Electronic
    Designs Corporation (incorporated herein by reference to Exhibit
    2.6 on Form 10-Q filed February 8, 2007).3
.1

Amended and Restated Articles of Incorporation of White
    Electronic Designs Corporation (incorporated herein by reference
    to Appendix A on Definitive Proxy Statement filed April 9, 2009).3
.2

Amended and Restated By-Laws of White Electronic Designs
    Corporation dated July 27, 2009 (incorporated herein by
    reference to Exhibit 3.1 on Form 8-K filed July 31, 2009).4
.1

Shareholder Rights Agreement, dated December 6, 1996
    (incorporated herein by reference to Exhibit 5(b) on Form 8-K,
    filed December 19, 1996).4
.2

Amendment No. 1 to Rights Agreement, dated as of December 6,
    1996 (incorporated herein by reference to Exhibit 4.3 on Form
    S-4, filed June 11, 1998, Registration No. 333-56565).4
.3

Amendment No. 2 to Rights Agreement, effective December 5, 2006
    (incorporated herein by reference to Exhibit 4.3 on Form 10-K,
    filed December 14, 2006).10
.1

Agreement to be Bound by Registration Rights Agreements, dated
    as of May 3, 1998, by and between Bowmar Instrument Corporation
    and Electronic Designs, Inc. (incorporated herein by reference
    to Exhibit 10.1 on Form S-4, filed Jun 11, 1998, Registration
    No. 333-56565).10
.2**

Agreement to be Bound by Severance Agreements and Employment
    Agreement, dated as of May 3, 1998, by and between Bowmar
    Instrument Corporation and Electronic Designs, Inc.
    (incorporated herein by reference to Exhibit 10.2 on Form S-4,
    filed June 11, 1998, Registration No. 333-56565).10
.3**

White Electronic Designs Corporation 1994 Flexible Stock Plan
    (incorporated herein by reference to Exhibit 99 to the
    Registration Statement on Form S-8, filed May 9, 2001,
    Registration No. 333-60544).10
.4**

Amendment to the Bowmar Instrument Corporation 1994 Flexible
    Stock Plan, effective May 7, 2001 (incorporated herein by
    reference to Appendix A to the Companys definitive Proxy
    Statement prepared in connection with the 2001 Annual Meeting of
    Shareholders).10
.5

White Electronic Designs Corporation Rule 10b5-1 Stock Purchase
    Plan, dated June 21, 2006 (incorporated herein by reference to
    Exhibit 10.3 on Form 10-Q, filed August 10, 2006).10
.6

Credit Agreement by and among White Electronic Designs
    Corporation, certain lenders named therein and JPMorgan Chase
    Bank, N.A., dated April 3, 2007 (incorporated herein by
    reference to Exhibit 10.2 on Form 10-Q, filed May 10, 2007).10
.7

First Modification Agreement to Revolving Line of Credit
    Agreement with JPMorgan Chase Bank, N.A., dated February 12,
    2008 (incorporated herein by reference to Exhibit 10.7 on Form
    10-K, filed December 11, 2008).10
.8

Second Modification Agreement to Revolving Line of Credit
    Agreement with JPMorgan Chase Bank, N.A., dated August 5, 2008
    (incorporated herein by reference to Exhibit 10.1 on Form 10-Q,
    filed August 7, 2008).10
.9

Third Modification Agreement to Revolving Line of Credit
    Agreement with JPMorgan Chase Bank, N.A., dated March 31, 2009
    (incorporated herein by reference to Exhibit 10.1 on Form 8-K,
    filed April 7, 2009). 72




---



##### Table of Contents



ExhibitNumber

Description10
.10**

White Electronic Designs Corporation 2001 Director Stock
    Plan (incorporated herein by reference to Exhibit 99 on Form
    S-8, filed May 9, 2001, Registration No. 333-60536).10
.11**

Amendment to Bowmar Instrument Corporation Stock Option Plan for
    Non-Employee Directors (incorporated herein by reference to
    Appendix D to the Companys definitive Proxy Statement in
    connection with the 2001 Annual Meeting of Shareholders).10
.12**

White Electronic Designs Corporation Stock Option Plan for
    Non-Employee Directors (incorporated herein by reference to
    Exhibit 99 on Form S-8, filed May 9, 2001, Registration No.
    333-60548).10
.13**

White Electronic Designs Corporation 2000 Broad Based Employee
    Stock Option Plan (incorporated herein by reference to Exhibit
    99 on Form S-8, filed May 9, 2001, Registration No. 333-60542).10
.14**

Severance Agreement and Release of Claims, dated August 28,
    2008, between White Electronic Designs Corporation and Hamid R.
    Shokrgozar (incorporated herein by reference to Exhibit 10.1 on
    Form 8-K, filed August 29, 2008).10
.15**

Non-Qualified Stock Option Agreement between White Electronic
    Designs Corporation and Hamid Shokrgozar dated November 10, 1999
    (incorporated herein by reference to Exhibit 10.42 on Form 10-K
    filed on December 23, 2002).10
.16

Industrial Real Estate Lease dated February 4, 1997 between
    Bowmar Instrument Corp., as tenant, and Allred Phoenix
    Properties, L.L.C., as landlord (incorporated herein by
    reference to Exhibit 10.5 on Form 10-K filed December 29, 2007).10
.17

First Amendment to certain Industrial Real Estate Lease dated
    February 4, 1997 between White Electronic Designs Corporation
    (as successor  in  interest of Bowmar
    Instrument Corp.) and Gus Enterprises  XII, L.L.C.
    (as successor  in  interest of Allred
    Phoenix Properties, L.L.C.) dated November 5, 2004 (incorporated
    herein by reference to Exhibit 10.21 on Form 10-K filed on
    December 16, 2004).10
.18**

White Electronic Designs Corporation 2006 Director
    Restricted Stock Plan, effective March 24, 2006 (incorporated by
    reference to Appendix A to the Companys definitive Proxy
    Statement in connection with the 2006 Annual Meeting of
    Shareholders).10
.19**

First Amendment to 2006 Director Restricted Stock Plan,
    effective August 24, 2006 (incorporated by reference to Exhibit
    99.1 on Form 8-K, filed August 30, 2006).10
.20**

Form of Restricted Stock Agreement to 2006 Director
    Restricted Stock Plan, effective August 24, 2006 (incorporated
    by reference to Exhibit 99.2 on Form 8-K, filed on August 30,
    2006).10
.21**

Change of Control Agreement between Dan V. Tarantine and White
    Electronic Designs Corporation, effective December 13, 2006
    (incorporated herein by reference to Exhibit 10.26 on Form 10-K,
    filed December 14, 2006).10
.22**

Change of Control Agreement between Roger A. Derse and White
    Electronic Designs Corporation, effective December 13, 2006
    (incorporated herein by reference to Exhibit 10.27 on Form 10-K,
    filed December 14, 2006).10
.23**

Form of Restricted Stock Units Award Agreement under the 1994
    Flexible Stock Plan (incorporated herein by reference to Exhibit
    10.19 on Form 10-K, filed December 13, 2007).10
.24**

Form of Performance Share Award Agreement under the 1994
    Flexible Stock Plan (incorporated herein by reference to Exhibit
    10.20 on Form 10-K, filed December 13, 2007).10
.25**

Employment Agreement dated January 21, 2009, between White
    Electronic Designs Corporation and Roger A. Derse (incorporated
    herein by reference to Exhibit 10.24 on Form 10-K/A filed
    January 26, 2009).10
.26**

Employment Agreement dated January 21, 2009, between White
    Electronic Designs Corporation and Dan V. Tarantine
    (incorporated herein by reference to Exhibit 10.25 on Form
    10-K/A filed January 26, 2009).10
.27**

Employment Agreement dated August 12, 2009, by and between White
    Electronic Designs Corporation and Gerald R. Dinkel
    (incorporated herein by reference to Exhibit 10.1 on Form 8-K
    filed August 13, 2009).10
.28

Shareholder Agreement dated February 4, 2009, by and among White
    Electronic Designs Corporation, Wynnefield Partners Small Cap
    Value, L.P. (and its affiliates), Caiman Partners, L.P. (and its
    affiliates), Kahn Capital Management LLC, Jack A. Henry, Paul D.
    Quadros, Thomas M. Reahard, Thomas J. Toy and Edward A. White
    (incorporated herein by reference to Exhibit 10.1 on Form 8-K
    filed February 11, 2009). 73




---



##### Table of Contents



ExhibitNumber

Description10
.29

Amendment No. 1 to Shareholder Agreement dated August 13, 2009,
    by and among White Electronic Designs Corporation, Wynnefield
    Partners Small Cap Value, L.P. (and its affiliates), Caiman
    Partners, L.P. (and its affiliates), Kahn Capital Management
    LLC, Jack A. Henry, Paul D. Quadros, Thomas R. Reahard, Thomas
    J. Toy and Edward A. White (incorporated herein by reference to
    Exhibit 10.1 on Form 8-K filed August 14, 2009).10
.30

Amendment No. 2 to Shareholder Agreement dated November 16,
    2009, by and among White Electronic Designs Corporation,
    Wynnefield Partners Small Cap Value, L.P. (and its affiliates),
    Caiman Partners, L.P. (and its affiliates), Kahn Capital
    Management LLC, Jack A. Henry, Paul D. Quadros, Thomas R.
    Reahard, Thomas J. Toy and Edward A. White (incorporated herein
    by reference to Exhibit 10.1 on Form 8-K filed November 17,
    2009).10
.31

Asset Purchase Agreement dated April 3, 2009, by and among White
    Electronic Designs Corporation, Panelview, Incorporated and VIA
    optronics GmbH and VIA optronics, LLC (incorporated herein by
    reference to Exhibit 10.1 on Form 8-K filed April 8, 2009).10
.32

Severance Agreement dated June 16, 2009 by and between Edward A.
    White and White Electronic Designs Corporation (incorporated
    herein by reference to Exhibit 10.1 on Form 8-K filed June 17,
    2009).21
.1*

Subsidiaries of White Electronic Designs Corporation.23
.1*

Consent of Grant Thornton LLP.31
.1*

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002.31
.2*

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002.32
.1##

Certification Pursuant to 18 U.S. C. Section 1350, As Adopted
    Pursuant To Section 906 of the
    Sarbanes-Oxley
    Act of 2002.32
.2##

Certification Pursuant to 18 U.S. C. Section 1350, As Adopted
    Pursuant To Section 906 of the
    Sarbanes-Oxley
    Act of 2002.     *
    
    Filed herewith.**
    
    Management compensatory contract, plan or arrangement.##
    
    Furnished herewith. 74