UNITED
STATES
 
 SECURITIES
AND EXCHANGE COMMISSION
 
 WASHINGTON,
D.C. 20549
 
 FORM
10-Q


/x/QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934 FOR THE QUARTERLY PERIOD ENDED APRIL 3, 2010.Or/
      /TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _______ TO
      _________.Commission
      File No. 0-25662ANADIGICS,
      Inc.(Exact
      name of registrant as specified in its charter)Delaware
            22-2582106(State
      or other jurisdiction of incorporation or organization)
            (I.R.S.
      Employer Identification No.)141
      Mt. Bethel Road, Warren, New Jersey
            07059(Address
      of principal executive offices)
            (Zip
      Code)(908)
      668-5000(Registrant's
      telephone number, including area
code)








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





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Website, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).


Yes [ ]
No [ ]








Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer”, “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act (check one):


Large
accelerated filer [ ] Accelerated filer [X] Non-accelerated filer (Do not check
if a smaller reporting company) [ ] Smaller reporting company [ ]





Indicate
by check mark whether the Registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  Yes [ ]  No [X]





The
number of shares outstanding of the Registrant’s common stock as of April 3,
2010 was 65,217,991 (excluding 114,574 shares held in treasury).











INDEX





ANADIGICS,
Inc.








PART
      I
            Financial
      InformationItem
      1.
            Financial
      Statements (unaudited)Condensed
      consolidated balance sheets – April 3, 2010 and December 31,
      2009Condensed
      consolidated statements of operations and comprehensive loss – Three
      months ended April 3, 2010 and April 4, 2009Condensed
      consolidated statements of cash flows – Three months ended April 3, 2010
      and April 4, 2009Notes
      to condensed consolidated financial statements – April 3,
    2010Item
      2.
            Management’s
      Discussion and Analysis of Financial Condition and Results of
      OperationsItem
      3.
            Quantitative
      and Qualitative Disclosures About Market RiskItem
      4.
            Controls
      and ProceduresPART
      II.
            Other
      InformationItem
      1.
            Legal
      ProceedingsItem
      6.
            ExhibitsSignatures













































































PART I -
FINANCIAL INFORMATION





ITEM
1.                      FINANCIAL
STATEMENTS





ANADIGICS,
Inc.





CONDENSED
CONSOLIDATED BALANCE SHEETS





(AMOUNTS
IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)





April
      3, 2010
            
            
            December
      31, 2009(Unaudited)
            
            
            (Note
      1)ASSETSCurrent
      assets:Cash
      and cash equivalents
            
            $
            80,682
            
            
            $
            83,172Accounts
      receivable, net
            
            
            23,096
            
            
            
            20,013Inventories
            
            
            18,176
            
            
            
            18,250Prepaid
      expenses and other current assets
            
            
            3,648
            
            
            
            2,503Total
      current assets
            
            
            125,602
            
            
            
            123,938Marketable
      securities
            
            
            9,694
            
            
            
            9,354Plant
      and equipment:Equipment
      and furniture
            
            
            211,076
            
            
            
            208,735Leasehold
      improvements
            
            
            45,558
            
            
            
            44,705Projects
      in process
            
            
            3,357
            
            
            
            5,978259,991
            
            
            
            259,418Less
      accumulated depreciation and amortization
            
            
            (183,092
            )
            
            
            (178,534
            )76,899
            
            
            
            80,884Other
      assets
            
            
            287
            
            
            
            276Total
      assets
            
            $
            212,482
            
            
            $
            214,452LIABILITIES
      AND STOCKHOLDERS’ EQUITYCurrent
      liabilities:Accounts
      payable
            
            $
            11,527
            
            
            $
            11,287Accrued
      liabilities
            
            
            10,641
            
            
            
            10,208Accrued
      restructuring costs
            
            
            3
            
            
            
            55Total
      current liabilities
            
            
            22,171
            
            
            
            21,550Other
      long-term liabilities
            
            
            3,329
            
            
            
            3,844Commitments
      and contingenciesStockholders’
      equity:Common
      stock, $0.01 par value, 144,000 shares authorized, 65,333 issued at April
      3, 2010 and 64,517 issued at December 31, 2009
            
            
            653
            
            
            
            645Additional
      paid-in capital
            
            
            579,700
            
            
            
            576,975Accumulated
      deficit
            
            
            (396,238
            )
            
            
            (391,050
            )Accumulated
      other comprehensive income
            
            
            3,126
            
            
            
            2,747Treasury
      stock at cost: 115 shares
            
            
            (259
            )
            
            
            (259
            )Total
      stockholders’ equity
            
            
            186,982
            
            
            
            189,058Total
      liabilities and stockholders’ equity
            
            $
            212,482
            
            
            $
            214,452











See
      accompanying notes.











ANADIGICS,
Inc.





CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS





(AMOUNTS
IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)





Three
      months endedApril
      3, 2010
            
            
            April
      4, 2009(unaudited)
            
            
            (unaudited)Net
      sales
            
            $
            43,531
            
            
            $
            30,495Cost
      of sales
            
            
            30,047
            
            
            
            29,245Gross
      profit
            
            
            13,484
            
            
            
            1,250Research
      and development expenses
            
            
            11,781
            
            
            
            11,625Selling
      and administrative expenses
            
            
            6,992
            
            
            
            7,432Restructuring
      charge
            
            
            -
            
            
            
            2,598Operating
      loss
            
            
            (5,289
            )
            
            
            (20,405
            )Interest
      income
            
            
            93
            
            
            
            559Interest
      expense
            
            
            (52
            )
            
            
            (591
            )Other
      income (expense), net
            
            
            60
            
            
            
            (1,545
            )Net
      loss
            
            $
            (5,188
            )
            
            $
            (21,982
            )Basic
      loss per share
            
            $
            (0.08
            )
            
            $
            (0.36
            )Diluted
      loss per share
            
            $
            (0.08
            )
            
            $
            (0.36
            )Weighted
      average common shares outstanding used in computing loss per
      shareBasic
            
            
            64,203
            
            
            
            61,742Diluted
            
            
            64,203
            
            
            
            61,742














CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS





(AMOUNTS
IN THOUSANDS)








Three
      months endedApril
      3, 2010
            
            
            April
      4, 2009(unaudited)
            
            
            (unaudited)Net
      loss
            
            $
            (5,188
            )
            
            $
            (21,982
            )Other
      comprehensive income:Unrealized
      gain (loss) on marketable securities
            
            
            402
            
            
            
            (33
            )Foreign
      currency translation adjustment
            
            
            (23
            )
            
            
            (83
            )Comprehensive
      loss
            
            $
            (4,809
            )
            
            $
            (22,098
            )


























See
      accompanying notes.





ANADIGICS,
      Inc.





CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS





(AMOUNTS
IN THOUSANDS)





Three
      months endedApril
      3, 2010
            
            
            April
      4, 2009(unaudited)
            
            
            (unaudited)CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss
            
            $
            (5,188
            )
            
            $
            (21,982
            )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
            
            
            4,591
            
            
            
            4,315Amortization
            
            
            -
            
            
            
            116Stock
      based compensation
            
            
            2,557
            
            
            
            3,410Recognized
      marketable securities impairment, net and other
            
            
            (38
            )
            
            
            1,571Loss
      (gain) on disposal of equipment
            
            
            43
            
            
            
            (20
            )Changes
      in operating assets and liabilities:Accounts
      receivable
            
            
            (3,083
            )
            
            
            11,449Inventories
            
            
            74
            
            
            
            4,918Prepaid
      expenses and other assets
            
            
            (1,177
            )
            
            
            (1,104
            )Accounts
      payable
            
            
            339
            
            
            
            (2,792
            )Accrued
      liabilities and other liabilities
            
            
            (111
            )
            
            
            (4,701
            )Net
      cash used in operating activities
            
            
            (1,993
            )
            
            
            (4,820
            )CASH
      FLOWS FROM INVESTING ACTIVITIESPurchases
      of plant and equipment
            
            
            (800
            )
            
            
            (6,854
            )Proceeds
      from sale of equipment
            
            
            27
            
            
            
            20Purchases
      of marketable securities
            
            
            -
            
            
            
            (15,201
            )Proceeds
      from sale of marketable securities
            
            
            100
            
            
            
            3,000Net
      cash used in investing activities
            
            
            (673
            )
            
            
            (19,035
            )CASH
      FLOWS FROM FINANCING ACTIVITIESIssuance
      of common stock
            
            
            176
            
            
            
            -Net
      cash provided by financing activities
            
            
            176
            
            
            
            -Net
      decrease in cash and cash equivalents
            
            
            (2,490
            )
            
            
            (23,855
            )Cash
      and cash equivalents at beginning of period
            
            
            83,172
            
            
            
            123,552Cash
      and cash equivalents at end of period
            
            $
            80,682
            
            
            $
            99,697








See
      accompanying notes.




















ANADIGICS,
Inc.





NOTES TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – APRIL 3,
2010





(AMOUNTS
IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)








1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES




BASIS OF
PRESENTATION




The
accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with U.S. generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation S-X.  Accordingly, they do not include all of the
information and footnotes required by U.S. generally accepted accounting
principles for complete financial statements.  In the opinion of
management, all adjustments (consisting of normal recurring accruals and
adjustments) considered necessary for a fair presentation have been
included.  Operating results for the three month period ended April 3,
2010 are not necessarily indicative of the results that may be expected for the
year ending December 31, 2010.




The condensed
consolidated balance sheet at December 31, 2009 has been derived from the
audited financial statements at that date but does not include all the
information and footnotes required by U.S. generally accepted accounting
principles for complete financial statements. For further information, refer to
the consolidated financial statements and footnotes thereto included in the
Company’s Annual Report on Form 10-K for the year ended December 31,
2009.




The condensed
consolidated financial statements include the accounts of the Company and its
wholly-owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated in consolidation.




The Company
has evaluated subsequent events and determined that there were no subsequent
events to recognize or disclose in these unaudited interim condensed
consolidated financial statements.





IMPACT OF
RECENTLY ISSUED ACCOUNTING STANDARDS




In January
2010, the Financial Accounting Standards Board issued Accounting Standards
Update (ASU) 2010-06, “Fair Value Measurements and Disclosures (Topic
820)”.  This standard requires disclosure of the transfers in and out
of Level 1 and 2 and a schedule for Level 3 that separately identifies
purchases, sales, issuances and settlements and requires more detailed
disclosures regarding valuation techniques and inputs.  The adoption
of this standard effective January 1, 2010 did not have a material impact on the
Company’s consolidated financial statements.





INCOME
TAXES




The Company
maintains a full valuation allowance on its deferred tax
assets.  Accordingly, the Company has not recorded a benefit or
provision for income taxes. The Company recognizes interest and penalties
related to the underpayment of income taxes in income tax expense. No
unrecognized tax benefits, interest or penalties were accrued at April 3, 2010.
The Company’s U.S. federal net operating losses have occurred since 1998 and as
such, tax years subject to potential tax examination could apply from that date
because carrying-back net operating loss opens the relevant year to
audit.





WARRANTY




Based on the
examination of historical returns and other information it deems critical, the
Company estimates that a current charge to income will need to be provided in
order to cover future warranty obligations for products sold during the year.
The accrued liability for warranty costs is included in Accrued liabilities in
the condensed consolidated balance sheets.Warranty
reserve movements in the three months ended April 3, 2010 included $336 in
actual charges and $264 in provisions resulting in the balance of $922 at April
3, 2010.  Warranty reserve movements in the three months ended April
4, 2009 included $415 in actual charges and a $183 increase in the
provision.





RECLASSIFICATIONS




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





2.  RESTRUCTURING
CHARGE




During the
fourth quarter of 2008 and first quarter of 2009, the Company implemented
certain workforce reduction programs, which eliminated approximately 210
positions throughout the Company, resulting in charges aggregating $4,738 for
severance and related benefits.





Workforce-related
            
            
            Other
            
            
            TotalDecember
      31, 2008 balance
            
            $
            1,065
            
            
            $
            100
            
            
            $
            1,165Additions
            
            
            2,598
            
            
            
            -
            
            
            
            2,598Deductions
            
            
            (3,608
            )
            
            
            (100
            )
            
            
            (3,708
            )December
      31, 2009 balance
            
            $
            55
            
            
            $
            -
            
            
            $
            55Deductions
            
            
            (52
            )
            
            
            -
            
            
            
            (52
            )April
      3, 2010 balance
            
            $
            3
            
            
            $
            -
            
            
            $
            3




3.  LOSS
PER SHARE




The
reconciliation of shares used to calculate basic and diluted loss per share
consists of the following:





Three
      months endedApril
      3, 2010
            
            
            April
      4, 2009Weighted
      average common shares for basic loss per share
            
            
            64,203
            
            
            
            61,742Effect
      of dilutive securities:Stock options
    (*)
            
            
            -
            
            
            
            -Unvested restricted shares
      (*)
            
            
            -
            
            
            
            -Adjusted
      weighted average shares for diluted loss per share
            
            
            64,203
            
            
            
            61,742





*
            Incremental
      shares from restricted shares and stock options are computed using the
      treasury stock method.




For the three
months ended April 3, 2010 and April 4, 2009, potential additional dilution
arising from any of the Company's outstanding stock options, unvested restricted
stock (shares or units), or shares potentially issuable upon conversion of the
Convertible notes are detailed below. Such potential dilution was excluded as
their effect was anti-dilutive.





Three
      months endedApril
      3, 2010
            
            
            April
      4, 2009Convertible
      notes
            
            
            N/A
            
            
            
            7,600Stock
      options
            
            
            5,110
            
            
            
            5,867Unvested
      restricted shares and units
            
            
            1,146
            
            
            
            1,941


4.  FAIR
VALUE AND MARKETABLE SECURITIES





FAIR
VALUE OF FINANCIAL INSTRUMENTS




Fair value is
defined as the price that would be received to sell an asset or paid to transfer
a liability in an orderly transaction between market participants at the
measurement date (exit price). Inputs used to measure fair value are classified
in the following hierarchy:





Level
      1
            Unadjusted
      quoted prices in active markets for identical assets or
      liabilitiesLevel
      2
            Unadjusted
      quoted prices in active markets for similar assets or liabilities, or
      unadjusted quoted prices for identical or similar assets or liabilities in
      markets that are not active, or inputs other than quoted prices that are
      observable for the asset or liabilityLevel
      3
            Unobservable
      inputs for the asset or liability





The Company
endeavors to utilize the best available information in measuring fair value.
Financial assets and liabilities are classified in their entirety based on the
lowest level of input that is significant to the fair value measurement. The
following table presents a summary of fair value information for
available-for-sale securities as at December 31, 2009 and April 3, 2010 in
accordance with ASC Topic 820:





Fair
      Value Measurements at Reporting Date UsingSecurity
      Type
            
            Amortized
              Cost
      Basis
              (1)
            
            
            Fair
      Value
            
            
            Quoted
      Prices in Active Markets for Identical Assets
              (Level
      1)
            
            
            Significant
      Other Observable Inputs
              (Level
      2)
            
            
            Significant
      Unobservable Inputs
              (Level
      3)Non-auction
      Corporate Debt securities (2)
            
            $
            1,530
            
            
            $
            2,740
            
            
            $
            2,740
            
            
            $
            -
            
            
            $
            -Auction
      Rate SecuritiesCorporate
      Debt (2)
            
            
            600
            
            
            
            1,106
            
            
            
            -
            
            
            
            -
            
            
            
            1,106Preferred
      Equity
            
            
            3,013
            
            
            
            3,703
            
            
            
            -
            
            
            
            -
            
            
            
            3,703State
      and Municipal Debt(2)
            
            
            1,497
            
            
            
            1,805
            
            
            
            -
            
            
            
            -
            
            
            
            1,805Total
      at December 31, 2009
            
            $
            6,640
            
            
            $
            9,354
            
            
            $
            2,740
            
            
            $
            -
            
            
            $
            6,614Non-auction
      Corporate Debt securities (2)
            
            $
            1,530
            
            
            $
            3,040
            
            
            $
            3,040
            
            
            $
            -
            
            
            $
            -Auction
      Rate SecuritiesCorporate
      Debt (2)
            
            
            600
            
            
            
            1,129
            
            
            
            -
            
            
            
            -
            
            
            
            1,129Preferred
      Equity
            
            
            3,013
            
            
            
            3,745
            
            
            
            -
            
            
            
            -
            
            
            
            3,745State
      and Municipal Debt(2)
            
            
            1,435
            
            
            
            1,780
            
            
            
            -
            
            
            
            -
            
            
            
            1,780Total
      at April 3, 2010
            
            $
            6,578
            
            
            $
            9,694
            
            
            $
            3,040
            
            
            $
            -
            
            
            $
            6,654





(1)
            Difference
      between amortized cost basis and fair value represents gross unrealized
      gains.


(2)
            These
      available for sale debt securities have contractual maturities in excess
      of 10 years.




The fair
value of each of the following instruments approximates their carrying value
because of the short maturity of these instruments: cash and cash equivalents,
accounts receivable, accounts payable and accrued liabilities.





AUCTION
RATE SECURITIES




Auction rate
securities (ARS) are generally long-term financial instruments that provided
liquidity through a Dutch auction process that resets the applicable interest
rate at pre-determined calendar intervals, generally every 28 days. The
mechanism generally allowed existing investors to rollover their holdings while
continuing to own their respective securities or liquidating their holdings by
selling their securities at par value. The Company generally invested in these
securities for short periods of time as part of its cash management program.
During the second half of 2007, certain auction rate debt and preferred
securities failed to auction due to sell orders exceeding buy orders. In
February 2008, liquidity issues in the global credit markets resulted in
failures of the auction process for a broader range of ARS, including
substantially all of the auction rate corporate, state and municipal debt and
preferred equity securities the Company holds. The funds associated with thefailed auctions
will not be accessible until a successful auction occurs, a buyer is found
outside of the auction process or an issuer redeems its security.




At April 3,
2010, there was insufficient observable ARS market information available to
determine the fair value of the Company’s investments in ARS. Given the
complexity of ARS investments, the Company obtained the assistance of an
independent valuation firm to assist management in assessing the Level 3 fair
value of its ARS portfolio. The third party valuations developed to estimate the
ARS fair value were determined using a combination of two calculations (1) a
discounted cash flow model, where the expected cash flows of the ARS are
discounted to the present using a yield that incorporates compensation for
illiquidity, and (2) a market comparables method, where the ARS are valued based
on indications, from the secondary market, of what discounts buyers demand when
purchasing similar ARS. The valuations include numerous assumptions such as
assessments of the underlying structure of each security, expected cash flows,
discount rates, credit ratings, workout periods, and overall capital market
liquidity.




During 2008,
a corporate debt ARS position with a face value of $4,000 was exchanged for the
underlying 30 year notes due 2037. At April 3, 2010, the Company values this
security on a Level 1 basis, with a fair value of $3,040.




The Company
considers it more likely than not that it will sell their marketable debt
securities prior to a recovery in valuation.




For the three
months ended April 3, 2010, the table below provides a reconciliation of the
beginning and ending balances for each type of security valued using a Level 3
valuation.





($
      in 000’s)
            
            Fair
      Value Measurements Using Significant Unobservable Inputs (Level
      3)
              Three
      months ended April 3, 2010State
      & Municipal Securities (a)
            
            
            Corporate
      Debt Securities (b)
            
            
            Preferred
      Equity Securities (c)
            
            
            TotalBalance
      at January 1, 2010
            
            $
            1,805
            
            
            $
            1,106
            
            
            $
            3,703
            
            
            $
            6,614Total gains or losses
      realized/unrealizedIncluded in earnings
      (loss)
            
            
            38
            
            
            
            -
            
            
            
            -
            
            
            
            38Included in other comprehensive
      income(loss)
            
            
            37
            
            
            
            23
            
            
            
            42
            
            
            
            102Purchases, redemptions, and
      settlements:Purchases
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Redemptions
            
            
            (100
            )
            
            
            -
            
            
            
            -
            
            
            
            (100
            )Settlements
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Transfers in and/or out of Level
      3
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Balance
      at April 3, 2010
            
            $
            1,780
            
            
            $
            1,129
            
            
            $
            3,745
            
            
            $
            6,654Amount
      of total gains or losses for the period included in earnings(loss)
      attributable to the change in unrealized gains or losses relating to
      assets still held at the reporting date
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Securities
      held at April 3, 2010:Face
      value
            
            $
            2,300
            
            
            $
            2,500
            
            
            $
            7,000
            
            
            $
            11,800Financial
      ratings
            
            
            A3
            
            
            
            A
            
            
            AAA
      to NRWeighted
      average interest rate (*)
            
            
            1.20
            %
            
            
            2.09
            %
            
            
            0.75
            %
            
            
            1.12
            %Maturity
      date
            
            
            2045
            
            
            
            2036
            
            
            
            N/A


*
Interest rates are reset every one to three months based on a premium to AA
Commercial Paper, LIBOR or Treasury Bill rates.


(a)
Security represents an interest in pooled student loans that are guaranteed by
the Federal Family Education Loan Program.


(b)
Security issued by a publicly-held insurance company trust, which holds
investments in  U.S. Government obligations, highly rated commercial
paper and money market funds and other investments approved by two credit rating
agencies. The trust is funded by life insurance residuals. If the residuals are
insufficient, the security becomes an obligation of the publicly-held insurance
company.


(c)
Preferred securities issued by three diversified closed-end management
investment companies which are governed by the Investment Company Act of 1940
with regard to operating standards, antifraud rules, diversification
requirements and an asset coverage requirement for asset backing of 200% of the
par value of the preferred stock issued and preferred securities issued by
subsidiaries of two publicly-held debt default insurers one of which no longer
pays interest and has been written to zero.




For the three
month period ended April 4, 2009, the table below provides a reconciliation of
the beginning and ending balances for each type of security valued using a Level
3 valuation.





($
      in 000’s)
            
            Fair
      Value Measurements Using Significant Unobservable Inputs (Level
      3)
              Three
      months ended April 4, 2009State
      & Municipal Securities (a)
            
            
            Corporate
      Debt Securities (b)
            
            
            Preferred
      Equity Securities (c)
            
            
            TotalBalance
      at January 1, 2009
            
            $
            1,947
            
            
            $
            662
            
            
            $
            4,340
            
            
            $
            6,949Total gains or losses
      realized/unrealizedIncluded in loss
            
            
            (325
            )
            
            
            (62
            )
            
            
            (824
            )
            
            
            (1,211
            )Included in other comprehensive
      (loss)
              income
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Purchases, redemptions, and
      settlements
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Transfers in and/or out of Level
      3
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Balance
      at April 4, 2009
            
            $
            1,622
            
            
            $
            600
            
            
            $
            3,516
            
            
            $
            5,738




5.  INVENTORIES




Inventories
are stated at the lower of cost (first-in, first-out method) or
market.  Inventories consist of the following:





April
      3, 2010
            
            
            December
      31, 2009Raw
      materials
            
            $
            6,843
            
            
            $
            6,582Work
      in process
            
            
            11,548
            
            
            
            9,845Finished
      goods
            
            
            9,924
            
            
            
            11,70228,315
            
            
            
            28,129Reserves
            
            
            (10,139
            )
            
            
            (9,879
            )Total
            
            $
            18,176
            
            
            $
            18,250


6.  CONVERTIBLE
DEBT




On September
24, 2004, the Company issued $38,000 aggregate principal amount of 5%
Convertible Senior Notes (2009 Notes) due October 15, 2009. The 2009 Notes were
convertible into shares of the Company’s common stock at any time prior to their
maturity, at an initial conversion rate of 200 shares for each $1,000 principal
amount, which was equivalent to a conversion price of $5.00 per share (7,600
shares contingently issuable). Interest on the 2009 Notes was payable
semi-annually in arrears on April 15 and October 15 of each year.  The
2009 Notes were repaid on the October 15, 2009 maturity date.




7.  STOCK
BASED COMPENSATION





Equity
Compensation Plans




The Company
had 4 equity compensation plans under which equity securities are authorized for
issuance to employees and/or directors:


§
            The
      1995 Long-Term Incentive and Share Award Plan for Officers and Directors
      (terminated February 28, 2005)  (1995
  Plan);


§
            The
      1997 Long Term Incentive and Share Award Plan (1997
  Plan);


§
            The
      2005 Long Term Incentive and Share Award Plan (2005 Plan, collectively
      with the 1995 Plan and the 1997 Plan, the Plans);
  and


§
            The
      Employee Stock Purchase Plan (ESP
Plan).




Employees and
outside directors have been granted restricted stock shares or units
(collectively, restricted stock) and options to purchase shares of common stock
under stock option plans adopted in 1995, 1997 and 2005. An aggregate of 4,913,
5,100 and 11,550 shares of common stock were reserved for issuance under the
1995 Plan, the 1997 Plan and the 2005 Plan, respectively. The Plans provide for
the granting of stock options, stock appreciation rights, restricted stock and
other share based awards to eligible employees and directors, as defined in the
Plans. Option grants have terms of ten years and become exercisable in varying
amounts over periods of up to three years. To date, no stock appreciation rights
have been granted under the Plans. In connection with the hiring of the
Company’s new President and Chief Executive Officer on February 1, 2009, an
inducement award of 700 stock options was granted to him outside of the
Plans.




In 1995, the
Company adopted the ESP Plan under Section 423 of the Internal Revenue Code. All
full-time employees of ANADIGICS, Inc. and part-time employees, as defined in
the ESP Plan, are eligible to participate in the ESP Plan. An aggregate of 4,194
shares of common stock were reserved for offering under the ESP Plan. Offerings
are made at the commencement of each calendar year and must be purchased by the
end of that calendar year. Pursuant to the terms of the ESP Plan, shares
purchased and the applicable per share price were 729 and $1.39, respectively
for the year ended December 31, 2009.




The table
below summarizes stock based compensation by source and by financial statement
line item for the three month periods:




Three
      months endedApril
      3, 2010
            
            
            April
      4, 2009Amortization
      of restricted stock
            
            $
            1,851
            
            
            $
            2,464Amortization
      of ESP Plan
            
            
            200
            
            
            
            200Amortization
      of stock option awards
            
            
            506
            
            
            
            746Total
      stock based compensation
            
            $
            2,557
            
            
            $
            3,410By
      Financial Statement line itemCost
      of sales
            
            $
            573
            
            
            $
            725Research
      and development expenses
            
            
            851
            
            
            
            1,431Selling
      and administrative expenses
            
            
            1,133
            
            
            
            1,445Restructuring
      charge
            
            
            -
            
            
            
            (191
            )





No tax
benefits have been recorded due to the Company’s full valuation allowance
position.





Restricted
Stock and Stock Option Awards




Commencing in
August 2004, the Company began granting restricted stock shares under the Plans
and in July 2008 began granting restricted stock units (collectively restricted
stock). The value of restricted stock grants are fixed upon the date of grant
and amortized over the related vesting period of one to three
years.  Restricted stock is subject to forfeiture if employment
terminates prior to vesting.  The Company estimates that approximately
2.5% of its restricted stock grants are forfeited annually (exclusive of LTI’s,
as described below).  The restricted stock shares carry voting and
certain forfeitable dividend rights commencing upon grant, whereas restricted
stock units do not. Neither restricted stock shares nor restricted stock units
may be traded or transferred prior to vesting.  Grant, vest and
forfeit activity and related weighted average (WA) price per share for
restricted stock and for stock options during the period from January 1, 2009 to
April 3, 2010 is presented in tabular form below:





Restricted
      Stock Shares
            
            
            Restricted
      Stock Units
            
            
            Stock
      OptionsShares
            
            
            WA
      price/ share
            
            
            Units
            
            
            WA
      price/ unit
            
            
            Issuable
      upon exercise
            
            
            WA
      exercise priceOutstanding
      at January 1, 2009
            
            
            1,974
            
            
            $
            9.27
            
            
            
            611
            
            
            $
            4.94
            
            
            
            2,819
            
            
            $
            10.00Granted
            
            
            -
            
            
            
            -
            
            
            
            873
            
            
            
            3.22
            
            
            
            3,245
            
            
            
            2.04Shares
      vested/options exercised
            
            
            (1,195
            )
            
            
            8.66
            
            
            
            (587
            )
            
            
            4.71
            
            
            
            (49
            )
            
            
            2.06Forfeited/expired
            
            
            (141
            )
            
            
            11.52
            
            
            
            (69
            )
            
            
            4.01
            
            
            
            (708
            )
            
            
            9.18Balance
      at December 31, 2009
            
            
            638
            
            
            $
            9.90
            
            
            
            828
            
            
            $
            3.36
            
            
            
            5,307
            
            
            $
            5.32Granted
            
            
            -
            
            
            
            -
            
            
            
            680
            
            
            
            3.96
            
            
            
            6
            
            
            
            4.44Shares
      vested/options exercised
            
            
            (232
            )
            
            
            8.59
            
            
            
            (747
            )
            
            
            3.33
            
            
            
            (91
            )
            
            
            1.94Forfeited/expired
            
            
            (18
            )
            
            
            8.53
            
            
            
            (3
            )
            
            
            4.33
            
            
            
            (112
            )
            
            
            18.31Balance
      at April 3, 2010
            
            
            388
            
            
            $
            10.74
            
            
            
            758
            
            
            $
            3.93
            
            
            
            5,110
            
            
            $
            5.09





In 2008, 357
restricted stock shares were grantedpursuant to long-term incentive
awards (LTI) issued to management contingent upon the Company’s performance
using multi-year adjusted earnings per share and revenue targets measured over a
three-year period ending December 31, 2010.  The number of shares
issuable pursuant to the LTI award can vary upon actual performance to such
targets and range from 50% to 150% of the base share award. In 2008, 27 shares
of the 357 LTI shares were released upon the separation of our former chief
executive officer.  As of April 3, 2010, a total of 174 LTI shares
have forfeited since their initial grant date. Based upon the performance of the
Company to April 3, 2010, no further stock-based compensation for LTI has been
expensed and the related unrecognized stock-based compensation has been excluded
from the table below.




As
      of April 3, 2010Unrecognized
      stock based compensation costOption plans
            
            $
            1,921Restricted stock
            
            $
            3,546Weighted
      average remaining recognition periodOption plans
            
            1.9
      yearsRestricted stock
            
            0.6
      years





Stock
options outstanding at April 3, 2010 are summarized as follows:





Range
      of exercise prices
            
            
            Outstanding
      Options at April 3, 2010
            
            
            Weighted
      average remaining contractual life
            
            
            Weighted
      average exercise price
            
            
            Exercisable
      at April 3, 2010
            
            
            Weighted
      average exercise price$
            1.39
      - $1.93
            
            
            
            1,589
            
            
            
            7.7
            
            
            $
            1.93
            
            
            
            835
            
            
            $
            1.93$
            2.03
      - $6.21
            
            
            
            1,738
            
            
            
            7.6
            
            
            $
            2.46
            
            
            
            1,025
            
            
            $
            2.52$
            6.74
      - $8.84
            
            
            
            1,143
            
            
            
            5.0
            
            
            $
            8.23
            
            
            
            1,143
            
            
            $
            8.23$
            9.00
      - $20.25
            
            
            
            640
            
            
            
            1.9
            
            
            $
            14.49
            
            
            
            632
            
            
            $
            14.49





Valuation
Method for ESP Plan and Stock Option Awards




The fair
value of these equity awards was estimated at the date of grant using a
Black-Scholes option pricing model. The weighted average assumptions and fair
values for stock based compensation grants used for the three month periods
ended April 3, 2010 and April 4, 2009 were:





Three
      months endedApril
      3, 2010
            
            
            April
      4, 2009Stock
      option awards:Risk-free
      interest rate
            
            
            2.6
            %
            
            
            1.6
            %Expected
      volatility
            
            
            85
            %
            
            
            99
            %Average
      expected term (in years)
            
            
            5.0
            
            
            
            5.0Expected
      dividend yield
            
            
            0.0
            %
            
            
            0.0
            %Weighted
      average fair value of options granted
            
            $
            3.02
            
            
            $
            1.46ESP
      Plan:Risk-free
      interest rate
            
            
            0.5
            %
            
            
            0.6
            %Expected
      volatility
            
            
            65
            %
            
            
            115
            %Average
      expected term (in years)
            
            
            1.0
            
            
            
            1.0Expected
      dividend yield
            
            
            0.0
            %
            
            
            0.0
            %Weighted
      average fair value of purchase option
            
            $
            1.52
            
            
            $
            0.83




For equity
awards with expected terms of greater than one year, the assumption for expected
volatility is based on a combination of implied and historical volatility,
whereas for equity awards with an expected term of one year or less, the
assumption is solely based on the Company’s historical volatility.




8. LEGAL
PROCEEDINGS




On or about
November 11, 2008, plaintiff Charlie Attias filed a putative securities class
action lawsuit in the United States District Court for the District of New
Jersey, captioned Charlie
Attias v. Anadigics, Inc., et al., No. 3:08-cv-05572,
and, on or about November 21, 2008, plaintiff Paul Kuznetz filed a related class
action lawsuit in the same court, captioned Paul J. Kuznetz v. Anadigics, Inc., et
al., No. 3:08-cv-05750 (jointly, the "Class Actions").  The
Complaints in the Class Actions, which were consolidated under the caption In re Anadigics, Inc. Securities
Litigation, No. 3:08-cv-05572, by an Order of the District Court dated
November 24, 2008, seek unspecified damages for alleged violations of Sections
10(b) and 20(a) of the Securities Exchange Act of 1934, as well as Rule 10b-5
promulgated thereunder, in connection with alleged misrepresentations and
omissions in connection with, among other things, Anadigics's manufacturing
capabilities and the demand for its products.  On October 23, 2009,
plaintiffs filed a Consolidated Amended Class Action Complaint, which names the
Company, a current officer and a former officer-director, and alleges a proposed
class period that runs from July 24, 2007 through August 7, 2008.  On
December 23, 2009, defendants filed a motion to dismiss the Amended
Complaint.  As of March 30, 2010, that motion had been fully briefed
by the parties.




On or about
January 14, 2009, a shareholder's derivative lawsuit, captioned Sicari v. Anadigics, Inc., et
al., No. SOM-L-88-09, was filed in the Superior Court of New Jersey, and,
on or about February 2, 2009, a related shareholder's derivative lawsuit,
captioned Moradzadeh v.
Anadigics, Inc., et al., No. SOM-L-198-09, was filed in the same court
(jointly, the "Derivative Lawsuits").  The Derivative Lawsuits seek
unspecified damages for alleged state law claims against certain of the
Company's current and former directors arising out of the matters at issue in
the Class Actions.  By Order dated March 6, 2009, the New Jersey
Superior Court consolidated the Derivative Lawsuits under the caption In re Anadigics, Inc. Derivative
Litigation, No. SOM-L-88-09.  By Order dated March 27, 2009,
the court stayed the Derivative Lawsuits pending disposition of the defendants'
motion to dismiss the Amended Complaint in the Class Actions.




Because the
Class Actions and the Derivative Lawsuits, which are in a preliminary stage, do
not specify alleged monetary damages, the Company is unable to reasonably
estimate a possible range of loss, if any, to the Company in connection
therewith.




The Company
is also a party to ordinary course litigation arising out of the operation of
our business. The Company believes that the ultimate resolution of such ordinary
course litigation should not have a material adverse effect on its consolidated
financial condition or results of operations.














ANADIGICS,
Inc.





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





OVERVIEW




ANADIGICS,
Inc. (“we” or the “Company”) is a leading provider of semiconductor solutions in
the growing broadband wireless and wireline communications
markets.  Our products include power amplifiers (PAs), tuner
integrated circuits, active splitters, line amplifiers and other components,
which can be sold individually or packaged as integrated radio frequency (RF)
and front end modules.  We believe that we are well-positioned to
capitalize on the high growth voice, data and video segments of the broadband
wireless and wireline communications markets.  We offer third
generation (3G) products that use the Wideband Code-Division Multiple Access
(W-CDMA) and Enhanced Data Rates for Global System for Mobile Communication
Evolution (EDGE) standards and combinations of W-CDMA and EDGE platforms
(WEDGE), beyond third generation (3.5G) products that use the High Speed Packet
Access (HSPA, inclusive of downlink and uplink) and Evolution Data Optimized
(EVDO) standards, fourth generation (4G) products for Worldwide Interoperability
for Microwave Access (WiMAX)and Long Term Evolution (LTE), Wireless Fidelity
(WiFi) products that use the 802.11 a/b/g and 802.11 n (Multiple Input Multiple
Output (MIMO)) standards, cable television (CATV) cable modem and set-top box
products, CATV infrastructure products and Fiber-To-The-Premises (FTTP)
products.




Our business
strategy focuses on developing RF front end solutions for our customers and
partnering with industry-leading wireless and wireline chipset providers to
incorporate our solutions into their reference designs.  Our
integrated solutions enable our customers to improve RF performance, power
efficiency, reliability, time-to-market and the integration of chip components
into single packages, while reducing the size, weight and cost of their
products.




We continue
to focus on leveraging our technological advantages to remain a leading supplier
of innovative semiconductor solutions for broadband wireless and wireline
communications. We believe our patented InGaP-plustechnology, which
combines the bipolar technology of a PA (HBT PA) with the surface device
technology of an RF active switch (pHEMT) on the same die, provides us with a
competitive advantage in the marketplace. For instance, we believe technologies
such as High Efficiency at Low Power (HELP) power amplifiers provide our
customers a competitive advantage by enabling their 3G, 3.5G and 4G devices to
consume less battery power and deliver longer talk time than comparable products
in their markets.




We
experienced declines in quarterly revenue during 2008 through the first quarter
of 2009, which resulted from a combination of a reduction in market share with
certain customers and an industry slowdown due to the macroeconomic environment.
During the fourth quarter of 2008 and first quarter of 2009, we reduced our
workforce by approximately 100 and 110 positions, respectively. Commencing in
the second quarter of 2009, we have experienced sequential growth in quarterly
revenues.




We were
incorporated in Delaware in 1984. Our corporate headquarters are located at 141
Mt. Bethel Road, Warren, New Jersey 07059, and our telephone number at that
address is 908-668-5000.




RESULTS OF
OPERATIONS




The following
table sets forth unaudited consolidated statements of operations data as a
percent of net sales for the periods presented:





Three
      months endedApril
      3, 2010
            
            
            April
      4, 2009Net
      sales
            
            
            100.0
            %
            
            
            100.0
            %Cost
      of sales
            
            
            69.0
            %
            
            
            95.9
            %Gross
      margin
            
            
            31.0
            %
            
            
            4.1
            %Research
      and development expenses
            
            
            27.1
            %
            
            
            38.1
            %Selling
      and administrative expenses
            
            
            16.0
            %
            
            
            24.4
            %Restructuring
      charge
            
            
            -
            
            
            
            8.5
            %Operating
      loss
            
            
            (12.1
            )%
            
            
            (66.9
            )%Interest
      income
            
            
            0.2
            %
            
            
            1.8
            %Interest
      expense
            
            
            (0.1
            )%
            
            
            (1.9
            )%Other
      income (expense), net
            
            
            0.1
            %
            
            
            (5.1
            )%Net
      loss
            
            
            (11.9
            )%
            
            
            (72.1
            )%




FIRST
QUARTER 2010 (ENDED APRIL 3, 2010) COMPARED TO FIRST QUARTER 2008 (ENDED APRIL
4, 2009)




NET
SALES.Net
sales increased 42.7% during the first quarter of 2010 to $43.5 million from
$30.5 million in the first quarter of 2009.




Sales of
integrated circuits for wireless applications increased 43.7% during the first
quarter of 2010 to $30.4 million from $21.1 million in the first quarter of
2009.  This increase in sales was primarily due to increased demand in
W-CDMA cellular device markets, marginally offset by declines in other
applications, principally CDMA.




Sales of
integrated circuits for broadband applications increased 40.6% during the first
quarter of 2010 to $13.1 million from $9.4 million in the first quarter of 2009.
This increase in sales was primarily due to increased demand for WiMax and cable
infrastructure products.




GROSS MARGIN.
Gross margin during the first quarter of 2010 increased to 31.0% of net sales
from 4.1% of net sales in the first quarter of 2009.  The increase in
gross margin was primarily due to increased product shipments and wafer
production, and fixed production costs decreasing as a percent of higher
revenues. Fixed production costs include, but are not limited to depreciation,
maintenance and operations’ support functions.




RESEARCH AND
DEVELOPMENT. Company-sponsored research and development (R&D) expenses
increased 1.3% during the first quarter of 2010 to $11.8 million from $11.6
million during the first quarter of 2009. The increase was primarily due to
increased material spending in our R&D product and process development
efforts, which were partially offset by lower personnel costs following the
headcount reductions implemented a year ago.




SELLING AND
ADMINISTRATIVE. Selling and administrative expenses decreased 5.9% to $7.0
million during the first quarter of 2010 from $7.4 million during the first
quarter of 2009.  The decrease was primarily driven by lower headcount
in general & administrative functions following last year’s headcount
reductions.




RESTRUCTURING
CHARGE.  During the first quarter of 2009 we implemented workforce
reductions, which eliminated approximately 110 positions, resulting in a
restructuring charge of $2.6 million principally for severance and related
benefits.




INTEREST
INCOME.Interest
income decreased 83.4% to $0.1 million during the first quarter of 2010 from
$0.6 million during the first quarter of 2009.  The decrease was due
to lower interest rates and compounded by lower average funds
invested.




INTEREST
EXPENSE.  Interest expense decreased 91.2 % to $0.1 million during the
first quarter of 2010 as compared to $0.6 million during the first quarter of
2009. The decrease principally related to the repayment our $38.0 million
outstanding balance of our 5% Convertible Senior Notes due in October
2009.




OTHER INCOME
(EXPENSE), NET. Other income of $0.1 million during the first quarter of 2010
compares to $1.5 million of other expense in the first quarter of 2009. Other
expense in the first quarter of 2009 was comprised of other-than-temporary
declines in value on certain auction rate securities and a corporate debt
security held by the Company.





LIQUIDITY
AND CAPITAL RESOURCES




As of April
3, 2010, we had $80.7 million in cash and cash equivalents and $9.7 million in
marketable securities.




Operating
activities used $2.0 million in cash during the three month period ended April
3, 2010, primarily as a result of our operating results adjusted for non-cash
expenses offset by $4.0 million of cash required to fund working capital.
Investing activities required $0.7 million of cash during the three month period
ended April 3, 2010 and consisted principally of purchases of fixed assets of
$0.8 million. Financing activities provided $0.2 million of cash, consisting of
proceeds received from stock option exercises.




We had
unconditional purchase obligations at April 3, 2010 of approximately $1.6
million.





Within our
$9.7 million in marketable securities at April 3, 2010, we held a total of $6.7
million of auction rate securities (ARS) and $3.0 million as a corporate debt
security, which was originally purchased as an ARS prior to its exchange for the
underlying 30 year notes due 2037. ARS are generally financial instruments of
long-term duration with interest rates that are reset in short intervals through
auctions. During the second half of 2007, certain auction rate debt and
preferred securities failed to auction due to sell orders exceeding buy orders.
In February 2008, liquidity issues in the global credit markets resulted in
failures of the auction process for a broader range of ARS, including
substantially all of the auction rate corporate, state and municipal debt and
preferred equity securities we hold. When there is insufficient demand for the
securities at the time of an auction and the auction is not completed, the
interest rates reset to predetermined higher rates (default rates). While
certain issuers redeemed certain of their ARS during 2008, the market remained
constrained by illiquidity and the lack of free trading. The funds associated
with the remaining failed auctions will not be accessible until a successful
auction occurs, a buyer is found outside of the auction process or an issuer
redeems its security. If the credit ratings of the security issuers deteriorate
and any decline in market value is determined to be other-than-temporary, we
would be required to adjust the carrying value of the investment through an
additional impairment charge. To date, we have not realized any losses on ARS
held by the Company or the notes received in exchange for an ARS, but have
recognized other-than-temporary impairments of $9.2 million.  For the
three months ended April 3, 2010, fair market values of certain of our ARS, when
combined with the fair market values of our corporate debt security, increased
by $0.4 million, which was recorded to other comprehensive income.




We anticipate
selling these impaired debt securities prior to a recovery in valuation. We will
continue to monitor and evaluate these investments for impairment and for short
term classification purposes. We may not be able to access cash by selling the
aforementioned debt or preferred securities without the loss of principal until
a buyer is located, a future auction for these investments is successful, they
are redeemed by their issuers or they mature. If we are unable to sell these
securities in the market or they are not redeemed, then we may be required to
hold them to maturity or in perpetuity for the preferred ARS. Based on our
ability to access our cash, our expected operating cash flows, and our other
sources of cash, we do not anticipate that the potential illiquidity of these
investments will affect our ability to execute our current business
plan.




We believe
that our existing sources of capital, including our existing cash and marketable
securities, will be adequate to satisfy operational needs and anticipated
capital needs for at least the next twelve months. We may elect to finance all
or part of our future capital requirements through additional equity or debt
financing.





IMPACT OF
RECENTLY ISSUED ACCOUNTING STANDARDS




In January
2010, the Financial Accounting Standards Board issued Accounting Standards
Update (ASU) 2010-06, “Fair Value Measurements and Disclosures (Topic
820)”.  This standard requires disclosure of the transfers in and out
of Level 1 and 2 and a schedule for Level 3 that separately identifies
purchases, sales, issuances and settlements and requires more detailed
disclosures regarding valuation techniques and inputs.  The adoption
of this standard effective January 1, 2010 did not have a material impact on our
consolidated financial statements.




FORWARD-LOOKING
STATEMENTS





This
quarterly report on Form 10-Q contains projections and other forward-looking
statements (as that term is defined in the Securities Exchange Act of 1934, as
amended).  These projections and forward-looking statements reflect
the Company’s current views with respect to future events and financial
performance and can generally be identified as such because the context of the
statement will include words such as “believe”, “anticipate”, “expect”, or words
of similar import. Similarly, statements that describe our future plans,
objectives, estimates or goals are forward-looking statements.  No
assurances can be given, however, that these events will occur or that these
projections will be achieved, and actual results and developments could differ
materially from those projected as a result of certain
factors.  Important factors that could cause actual results and
developments to be materially different from those expressed or implied by such
projections and forward-looking statements include, but are not limited to, the
following risks which are described in greater detail in the Company’s Annual
Report on Form 10-K referred to below: (i) our history of recent losses and the
possibility that we may continue to incur losses; (ii) unfavorable economic
conditions; (iii) our results of operations can vary significantly due to the
cyclical nature of the semiconductor industry and our end markets; (iv) our
operating results may be harmed if we fail to sell a high volume of products;
(v) our dependence on a small number of customers; (vi) the existence of intense
competition in the markets for our products, which could result in a decrease in
our products’ prices and sales; (vii) cost reduction measures may again be
required and could be inadequate or not realize their anticipated savings;
(viii) we may face failures in our manufacturing processes or processes of our
vendors; (ix) our dependence on foreign semiconductor component, assembly and
test operations contractors could lead to delays in product shipments; (x)
sources for certain components, materials and equipment are limited, which could
result in delays or reductions in product shipments; (xi) the variability of our
manufacturing yields may affect our gross margins; (xii) our products have
experienced rapidly declining unit prices; (xiii) the short life cycles of some
of our products may leave us with obsolete or excess inventories; (xiv) our need
to keep pace with rapid product and process development and technological
changes as well as product cost reductions to be competitive; (xv) any failure
to perform or meet customer requirements; (xvi) our gallium arsenide
semiconductors may cease to be competitive with silicon alternatives; (xvii)
capital required for our business may not be available when we need it; (xviii)
our marketable securities’ liquidity and valuation could be affected by
disruption in financial markets; (xix) our success depends on our ability to
attract and retain qualified personnel; (xx) risks due to our international
customer base and our subcontracting operations; (xxi) stringent environmental
laws and regulations both domestically and abroad; (xxii) any failure to protect
our intellectual property rights or avoid claims that we have infringed on the
intellectual property rights of others; (xxiii) any pursuit of selective
acquisitions and alliances which dilute the ownership of our current
shareholders and the management and integration of additional operations which
may be expensive and divert management time; (xxiv) we have had significant
volatility in our stock price and it may fluctuate in the future; (xxv) certain
provisions in our governing documents, our shareholders’ rights agreement and of
Delaware law could deter, delay or prevent a third party from acquiring us and
prevent shareholders from realizing a takeover premium; (xxvi) an adverse
outcome, to the extent not covered by insurance, in the class action or
shareholder derivative lawsuits in which we and certain of our officers and
directors are defendants. The foregoing review of important factors should not
be construed as exhaustive and should be read in conjunction with the other
cautionary statements that are included herein or detailed from time to time in
our reports filed with the Securities and Exchange Commission, including the
Company’s Annual Report on Form 10-K for the year ended December 31, 2009. The
Company undertakes no obligation to update publicly or revise any
forward-looking statement, whether as a result of new information, future
developments or otherwise.





ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




The Company's
market risk has not changed significantly for the risks disclosed in Item 7A of
the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
2009.





ITEM 4. CONTROLS AND
PROCEDURES


We maintain
disclosure controls and procedures that are designed to ensure that information
required to be disclosed in our reports filed with the Securities and Exchange
Commission, or SEC, is recorded, processed, summarized and reported within the
time periods specified in the SEC’s rules and forms, and that such information
is accumulated and communicated to our management, including our Chief Executive
Officer, or CEO, and Chief Financial Officer, or CFO, as appropriate, to allow
timely decisions regarding required disclosure.  As of April 3, 2010,
an evaluation was performed under the supervision and with the participation of
our Management, including our CEO and CFO, of the effectiveness of the design
and operation of our disclosure controls and procedures (as defined in Rules
13a-15(e) under the U.S. Securities Exchange Act of 1934).  Based on
that evaluation, our management, including our CEO and CFO, concluded that our
disclosure controls and procedures were effective as of April 3,
2010.




There was no
change in the Company’s internal control over financial reporting during the
Company’s last fiscal quarter that has materially affected, or is reasonably
likely to materially affect, the Company’s internal control over financial
reporting.




Because of
their inherent limitations, disclosure controls and procedures and internal
control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may
deteriorate.











ANADIGICS,
Inc.





PART II -
OTHER INFORMATION





ITEM 1. LEGAL
PROCEEDINGS




On or about
November 11, 2008, plaintiff Charlie Attias filed a putative securities class
action lawsuit in the United States District Court for the District of New
Jersey, captioned Charlie
Attias v. Anadigics, Inc., et al., No. 3:08-cv-05572,
and, on or about November 21, 2008, plaintiff Paul Kuznetz filed a related class
action lawsuit in the same court, captioned Paul J. Kuznetz v. Anadigics, Inc., et
al., No. 3:08-cv-05750 (jointly, the "Class Actions").  The
Complaints in the Class Actions, which were consolidated under the caption In re Anadigics, Inc. Securities
Litigation, No. 3:08-cv-05572, by an Order of the District Court dated
November 24, 2008, seek unspecified damages for alleged violations of Sections
10(b) and 20(a) of the Securities Exchange Act of 1934, as well as Rule 10b-5
promulgated thereunder, in connection with alleged misrepresentations and
omissions in connection with, among other things, Anadigics's manufacturing
capabilities and the demand for its products.  On October 23, 2009,
plaintiffs filed a Consolidated Amended Class Action Complaint, which names the
Company, a current officer and a former officer-director, and alleges a proposed
class period that runs from July 24, 2007 through August 7, 2008.  On
December 23, 2009, defendants filed a motion to dismiss the Amended
Complaint.  As of March 30, 2010, that motion had been fully briefed
by the parties.




On or about
January 14, 2009, a shareholder's derivative lawsuit, captioned Sicari v. Anadigics, Inc., et
al., No. SOM-L-88-09, was filed in the Superior Court of New Jersey, and,
on or about February 2, 2009, a related shareholder's derivative lawsuit,
captioned Moradzadeh v.
Anadigics, Inc., et al., No. SOM-L-198-09, was filed in the same court
(jointly, the "Derivative Lawsuits").  The Derivative Lawsuits seek
unspecified damages for alleged state law claims against certain of the
Company's current and former directors arising out of the matters at issue in
the Class Actions.  By Order dated March 6, 2009, the New Jersey
Superior Court consolidated the Derivative Lawsuits under the caption In re Anadigics, Inc. Derivative
Litigation, No. SOM-L-88-09.  By Order dated March 27, 2009,
the court stayed the Derivative Lawsuits pending disposition of the defendants'
motion to dismiss the Amended Complaint in the Class Actions.




Because the
Class Actions and the Derivative Lawsuits, which are in a preliminary stage, do
not specify alleged monetary damages, we are unable to reasonably estimate a
possible range of loss, if any, to the Company in connection
therewith.




We are also a
party to ordinary course litigation arising out of the operation of our
business. We believe that the ultimate resolution of such ordinary course
litigation should not have a material adverse effect on our consolidated
financial condition or results of operations.





ITEM 6. EXHIBITS








31.1 Rule
13a-14(a)/15d-14(a) Certification of Mario A. Rivas, President and Chief
Executive Officer of ANADIGICS, Inc.





31.2
      Rule 13a-14(a)/15d-14(a) Certification of Thomas C. Shields, Executive
      Vice President and Chief Financial Officer of ANADIGICS,
    Inc.





32.1
      Section 1350 Certification of Mario A. Rivas, President and Chief
      Executive Officer of ANADIGICS,
Inc.





32.2
      Section 1350 Certification of Thomas C. Shields, Executive Vice President
      and Chief Financial Officer of ANADIGICS,
Inc.





SIGNATURES








Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned thereunto duly
authorized.








ANADIGICS, INC.














By:
            /s/
      Thomas C. ShieldsThomas
      C. ShieldsExecutive
      Vice President and
      Chief Financial Officer





Dated:
April 28, 2010