##### 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
    May 27, 2006oro

TRANSITION REPORT PURSUANT TO
    SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
    1934For the transition period from
    
    toCommission file number 1-04837   TEKTRONIX, INC.
 (Exact name of registrant as
    specified in its charter)
  Oregon

93-0343990(State or other jurisdiction of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)14200 S.W. Karl Braun Drive
    Beaverton, Oregon(Address of principal
    executive offices)

97077(Zip Code)   Registrants telephone number,
    including area code:
    (503) 627-7111
  Securities registered pursuant to
    Section 12(b) of the Act:
  Title of each class

Name of each exchange on which
    registeredCommon Shares,
    without par value

New York Stock ExchangeSeries B No Par Preferred
    Shares Purchase Rights

New York Stock Exchange   Securities registered pursuant to
    Section 12(g) of the Act: None
  þ o
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
 Large
    accelerated filer þ
    Accelerated
    filer o
    Non-accelerated
    filer o  Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE
  Document

Part
    of 10-K
    into which incorporatedRegistrants Proxy
    Statement
    dated August 17, 2006


Part III




---



##### 



TEKTRONIX,
    INC.
  TABLE OF
    CONTENTS
  PageForward-Looking
    Statements


1PART IItem 1.

Business


2Item 1A.

Risk
    Factors


9Item 1B.

Unresolved Staff
    Comments


13Item 2.

Properties


13Item 3.

Legal
    Proceedings


13Item 4.

Submission of
    Matters to a Vote of Security Holders


14PART IIItem 5.

Market for the
    Registrants Common Equity, Related Stockholder Matters and
    Issuer Purchases of Equity Securities


14Item 6.

Selected Financial
    Data


15Item 7.

Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


16Item 7A.

Quantitative and
    Qualitative Disclosures About Market Risk


46Item 8.

Financial Statements
    and Supplementary Data


47Item 9.

Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


90Item 9A.

Controls and
    Procedures


90Item 9B.

Other
    Information


92PART IIIItem 10.

Directors and
    Executive Officers of the Registrant


92Item 11.

Executive
    Compensation


92Item 12.

Security Ownership
    of Certain Beneficial Owners and Management and Related
    Stockholder Matters


92Item 13.

Certain
    Relationships and Related Transactions


92Item 14.

Principal Accounting
    Fees and Services


92PART IVItem 15.

Exhibits and
    Financial Statement Schedules


93SIGNATURES


95SCHEDULE II 
    Valuation and Qualifying Accounts


96EXHIBIT 10(II)(A)EXHIBIT 10(X)EXHIBIT 10(XI)EXHIBIT 14(II)EXHIBIT 21EXHIBIT 23EXHIBIT 24EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2




---



##### Table of Contents



Forward-Looking
    Statements  Form 10-K
  Form 10-K
    Form 10-K.
 1




---



##### Table of Contents



PART I  Item 1.
    Business.  The
    Company
        this 10-K
    Form 10-K, Form 10-Q, Form 8-K, 97077-0001.
  Our
    Markets and Customers
     2




---



##### Table of Contents



Our
    Strategic Focus
               3




---



##### Table of Contents



Our
    Products
      General Purpose Test Products.
        Video Test Products.
       4




---



##### Table of Contents



Network Management and Diagnostics.
        Service.
  Accessories.
  Maxtek Components Corporation.
  Manufacturing
       5




---



##### Table of Contents



Sales and
    Distribution
            Geographic
    Areas of Operations
      Research
    and Development
   6




---



##### Table of Contents



10-K.
  Patents
    and Intellectual Property
    Employees
    Environment
  Form 10-K.
 7




---



##### Table of Contents



Executive
    Officers of Tektronix
    Has Servedas anExecutive Officerof TektronixName

Position

Age

SinceRichard H. Wills

Chairman of the Board, President
    and Chief Executive Officer


51



1997Colin L. Slade

Senior Vice President and Chief
    Financial Officer


52



2000Richard D. McBee

Senior Vice President,
    Communications Business


43



2001James F. Dalton

Senior Vice President, Corporate
    Development, General Counsel and Secretary


47



1998Craig L. Overhage

Senior Vice President, Instruments
    Business


44



2001Susan G. Kirby

Vice President, Human Resources


56



2004John T. Major

Vice President, Worldwide
    Manufacturing


46



2004            8




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##### Table of Contents



Item 1A.
    Risk
    Factors.  Risks
    and Uncertainties
  Form 10-K.
  We
    compete in a cyclical market.
    The
    industries we serve experience rapid changes in
    technology.
   9




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##### Table of Contents



next-generation
  Competition
    is intense, may intensify and could result in increased downward
    pricing pressure, reduced margins and the loss of market
    share.
    We
    obtain various key components, services and licenses from sole
    and limited source suppliers.
       10




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##### Table of Contents



Changes
    or delays in the implementation or customer acceptance of our
    products could harm our financial results.
    and/or
  Our
    network management business and reputation could suffer if we do
    not prevent security breaches.
    A
    significant portion of our revenues are from international
    customers, and, as a result, our business may be harmed by
    political and economic conditions in foreign markets and the
    challenges associated with operating
    internationally.
    Our
    success depends on our ability to maintain and protect our
    intellectual property and the intellectual property licensed
    from others.
   11




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##### Table of Contents



We are
    subject to environmental regulations.
      Our
    defined benefit pension plans are subject to financial market
    risks.
  Form 10-K
  Our
    reported results of operations will be materially and adversely
    affected by our adoption of SFAS 123R.
    We
    face other risk factors.
     12




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##### Table of Contents



Item 1B.
    Unresolved
    Staff Comments.    Item 2.
    Properties.            Location

Owned Space


Leased Space


Total SpaceUnited States:Beaverton, OR


1,304,094



500



1,304,594Richardson, TX






241,372



241,372Sales Offices






27,249



27,249Other Americas






10,636



10,636Europe






235,627



235,627Pacific


15,832



233,226



249,058Japan






69,497



69,497Other






43,380



43,380Totals


1,319,926



861,487



2,181,413   Item 3.
    Legal
    Proceedings.     13




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##### Table of Contents



Item 4.
    Submission
    of Matters to a Vote of Security Holders.   PART II  Item 5.
    Market
    for the Registrants Common Equity, Related Stockholder
    Matters and Issuer Purchases of Equity Securities.      Quarter

High


LowYear Ending May 27, 2006:Fourth Quarter

$
36.70


$
30.26Third Quarter


31.41



25.36Second Quarter


26.63



22.73First Quarter


25.29



22.56Year Ending May 28, 2005:Fourth Quarter

$
29.10


$
21.17Third Quarter


31.95



28.00Second Quarter


33.99



28.35First Quarter


34.94



26.49        14




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##### Table of Contents



CumulativeNumberof Shares


Maximum DollarTotal


Average





Purchased as


Value of SharesNumber


Price


Total


Part of Publicly


that Mayof Shares


Paid Per


Amount


Announced Plans


Yet BeFiscal Period

Purchased


Share


Paid


or Programs


PurchasedFebruary 26, 2006 to
    March 25, 2006





$



$




29,344,279


$
246,429,078March 26, 2006 to
    April 22, 2006


22,000



34.50



759,108



29,366,279



245,669,970April 23, 2006 to
    May 27, 2006


423,500



32.35



13,698,604



29,789,779


$
231,971,366Total


445,500


$
32.45


$
14,457,712   Item 6.
    Selected
    Financial Data.  Form 10-K.
  CONSOLIDATED
    FINANCIAL PERFORMANCE
 Amounts in millions, except per share data
  2006 (a)


2005 (a)


2004


2003


2002Net sales

$
1,039.9


$
1,034.7


$
920.6


$
791.0


$
810.3Gross margin %


59.8
%


59.8
%


56.8
%


51.3
%


49.4
%Earnings from continuing operations
    (b) (c)

$
90.9


$
78.9


$
118.2


$
35.1


$
33.6Earnings per share:Continuing operations 
    basic

$
1.09


$
0.91


$
1.40


$
0.40


$
0.37Continuing operations 
    diluted

$
1.08


$
0.89


$
1.37


$
0.40


$
0.36Weighted average shares outstanding:Basic


83.3



86.8



84.7



87.1



91.4Diluted


84.4



88.2



86.0



87.4



92.3Cash dividends declared per share

$
0.24


$
0.22


$
0.12


$



$
Total assets

$
1,634.1


$
1,460.3


$
1,348.5


$
1,384.7


$
1,378.9Long-term debt, excluding current
    portion

$



$
0.1


$
0.5


$
55.0


$
57.3     (a)
    
    Financial data for fiscal years
    2006 and 2005 included twelve months and eight months,
    respectively, of the results of operations of Inet which was
    acquired on September 30, 2004.(b)
    
    Included business realignment costs
    of $9.8 million, $3.1 million, $22.8 million,
    $34.6 million, and $27.0 million for fiscal years
    2006, 2005, 2004, 2003, and 2002, respectively.(c)
    
    Included acquisition related costs
    (credits) and amortization of $8.6 million,
    $41.6 million, $(51.0) million, and $3.5 million
    for fiscal years 2006, 2005, 2004 and 2003, respectively. See
    Note 5 of the Notes to the Consolidated Financial
    Statements in Item 8 Financial Statements and Supplementary
    Data for further information. 15




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##### Table of Contents



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.  Introduction
    and Overview
  Form 10-K
  Business
    Overview
          Form 10-K
    Form 10-K
 16




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##### Table of Contents



Acquisitions
          Inet
    Technologies, Inc.
        Cash paid

$
247,561Stock issued


247,543Stock options assumed


9,658Restricted share rights assumed


321Transaction costs


5,224Unearned stock-based compensation


(3,403
)Liabilities assumed


36,735Total purchase price

$
543,639  17




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##### Table of Contents



Cash and cash equivalents

$
158,821Accounts receivable


18,504Inventories


18,025Tax benefit from transaction costs


1,209Other current assets


6,708Property, plant, and equipment


10,662Intangible assets


121,953Goodwill


219,653Other long term assets


811In-process research and development


32,237Deferred income taxes


(44,944
)Total assets acquired, net of
    deferred income taxes

$
543,639     (In years)Weighted Average




AccumulatedUseful Life

Cost


Amortization


Net(In thousands)Developed technology

4.8

$
87,004


$
(30,824
)

$
56,180Customer relationships

4.8


22,597



(8,031
)


14,566Covenants not to compete

4.0


1,200



(500
)


700Tradename

Not amortized


11,152







11,152Total intangible assets purchased



$
121,953


$
(39,355
)

$
82,598     2006


2005(In thousands)Cost of sales

$
18,495


$
12,329Acquisition related costs (credits)
    and amortization


5,117



3,414Total

$
23,612


$
15,743    18




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##### Table of Contents



Acquisition RelatedCost of


Costs (Credits)Sales


and Amortization


Total(In thousands)Fiscal Year2007

$
18,495


$
5,117


$
23,6122008


16,670



4,621



21,2912009


15,759



4,174



19,9332010


5,256



1,354



6,610Total

$
56,180


$
15,266


$
71,446       2005


2004(In thousands, except per share amounts)Pro formaNet sales

$
1,071,333


$
1,033,346Net earnings


112,338



115,890Earnings per share:Basic

$
1.26


$
1.26Diluted

$
1.24


$
1.24       Sony/Tektronix
    Redemption
   19




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##### Table of Contents



Business
    Realignment Costs
           20




---



##### Table of Contents



CostsBalance


Incurred








BalanceMay 28,


and Other


Cash


Non-cash


May 27,2005


Adjustments


Payments


Adjustments


2006(In thousands)Fiscal Year 2006
    Actions:Employee severance and related
    benefits

$



$
11,142


$
(6,275
)

$



$
4,867Contractual obligations






259



(259
)






Accumulated currency translation
    gain, net






(1,603
)






1,603



Total






9,798



(6,534
)


1,603



4,867Fiscal Year 2005
    Actions:Employee severance and related
    benefits


568



(143
)


(414
)






11Contractual obligations


103



49



(152
)






Total


671



(94
)


(566
)






11Fiscal Year 2004
    Actions:Employee severance and related
    benefits


681



98



(208
)


42



613Total


681



98



(208
)


42



613Fiscal Year 2003 and 2002
    Actions:Employee severance and related
    benefits


2











1



3Contractual obligations


926



45



(460
)






511Total


928



45



(460
)


1



514Total of all actions

$
2,280


$
9,847


$
(7,768
)

$
1,646


$
6,005  21




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##### Table of Contents



CostsBalance


Incurred








BalanceMay 29,


and Other


Cash


Non-cash


May 28,2004


Adjustments


Payments


Adjustments


2005(In thousands)Fiscal Year 2005
    Actions:Employee severance and related
    benefits

$



$
2,447


$
(1,879
)

$



$
568Asset impairments






345







(345
)


Contractual obligations






525



(639
)


217



103Accumulated currency translation
    gain






(236
)






236



Total






3,081



(2,518
)


108



671Fiscal Year 2004
    Actions:Employee severance and related
    benefits


5,335



(235
)


(4,419
)






681Asset impairments






(97
)






97



Contractual obligations


409



327



(737
)


1



Total


5,744



(5
)


(5,156
)


98



681Fiscal Year 2003
    Actions:Employee severance and related
    benefits


294



(20
)


(272
)






2Contractual obligations


1,240



35



(479
)


109



905Total


1,534



15



(751
)


109



907Fiscal Year 2002
    Actions:Employee severance and related
    benefits


152



9



(161
)






Contractual obligations


54







(33
)






21Total


206



9



(194
)






21Total of all actions

$
7,484


$
3,100


$
(8,619
)

$
315


$
2,280  22




---



##### Table of Contents



CostsBalance


Incurred








BalanceMay 31,


and Other


Cash


Non-cash


May 29,2003


Adjustments


Payments


Adjustments


2004(In thousands)Fiscal Year 2004
    Actions:Employee severance and related
    benefits

$



$
17,351


$
(12,016
)

$



$
5,335Asset impairments






1,610







(1,610
)


Contractual obligations






1,514



(1,105
)






409Accumulated currency translation
    loss, net






2,594







(2,594
)


Total






23,069



(13,121
)


(4,204
)


5,744Fiscal Year 2003
    Actions:Employee severance and related
    benefits


5,394



(623
)


(4,477
)






294Asset impairments






(53
)






53



Contractual obligations


1,730



447



(1,085
)


148



1,240Total


7,124



(229
)


(5,562
)


201



1,534Fiscal Year 2002
    Actions:Employee severance and related
    benefits


494



172



(514
)






152Contractual obligations


434



(57
)


(323
)






54Total


928



115



(837
)






206Other






(190
)


(9
)


199



Total of all actions

$
8,052


$
22,765


$
(19,529
)

$
(3,804
)

$
7,484   Critical
    Accounting Estimates
    Revenue
    Recognition
     23




---



##### Table of Contents



Contingencies
           24




---



##### Table of Contents



Goodwill
    and Intangible Assets
             25




---



##### Table of Contents



Pension
    Plans
               26




---



##### Table of Contents



Income
    Taxes
         27




---



##### Table of Contents



Stock-based
    Compensation
       28




---



##### Table of Contents



RESULTS
    OF OPERATIONS
  For the Fiscal Years Ended


% ChangeMay 27,


May 28,


May 29,


FY2006 v


FY2005 v2006


2005


2004


FY2005


FY2004(In thousands, except per share amounts)Product orders

$
1,066,176


$
945,308


$
907,757



13
%


4
%Product backlog at end of year


244,637



171,229



142,250



43
%


20
%Net sales

$
1,039,870


$
1,034,654


$
920,620



1
%


12
%Cost of sales


418,428



415,878



397,577



1
%


5
%Gross profit


621,442



618,776



523,043



0
%


18
%Gross margin


59.8
%


59.8
%


56.8
%Research and development expenses


183,414



163,474



130,386



12
%


25
%Selling, general and administrative
    expenses


302,344



300,925



277,993



0
%


8
%Business realignment costs


9,847



3,100



22,765



>100
%


(86
)%Acquisition related costs (credits)
    and amortization


8,567



41,553



(51,025
)


(79
)%


*Loss (gain) on disposition of
    assets, net


(1,433
)


(1,700
)


1,134



(16
)%


*Operating income


118,703



111,424



141,790



7
%


(21
)%Interest income


13,585



17,144



21,565



(21
)%


(21
)%Interest expense


(483
)


(820
)


(2,208
)


(41
)%


(63
)%Other non-operating income
    (expense), net


(3,377
)


(3,564
)


6,165



(5
)%


*Earnings before taxes


128,428



124,184



167,312



3
%


(26
)%Income tax expense


37,536



45,333



49,087



(17
)%


(8
)%Net earnings from continuing
    operations operations


90,892



78,851



118,225



15
%


(33
)%Gain (loss) from discontinued
    operations, net of income taxes


1,463



2,745



(2,130
)


(47
)%


*Net earnings

$
92,355


$
81,596


$
116,095



13
%


(30
)%Earnings (loss) per share:Continuing operations 
    basic

$
1.09


$
0.91


$
1.40



20
%


(35
)%Continuing operations 
    diluted

$
1.08


$
0.89


$
1.37



21
%


(35
)%Discontinued operations 
    basic

$
0.02


$
0.03


$
(0.03
)


(33
)%


*Discontinued operations 
    diluted

$
0.02


$
0.03


$
(0.02
)


(33
)%


*Net earnings  basic

$
1.11


$
0.94


$
1.37



18
%


(31
)%Net earnings  diluted

$
1.09


$
0.93


$
1.35



17
%


(31
)%Weighted average shares outstandingBasic


83,323



86,803



84,720Diluted


84,381



88,151



86,038     *
    
    not meaningful 29




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##### Table of Contents



Fiscal
    Year 2006 Compared to Fiscal Year 2005








Executive
    Summary








Product
    Orders








|                        |  |                    |           |  |         |   |         |          |  |  |    |  
|----------------------- |  | ------------------ | --------- |  | ------- | - | ------- | -------- |  |  | -- | -
|                        |  | Fiscal Years Ended |           |  |         |  
|                        |  | May 27,            |           |  | May 28, |   |         |          | 
|                        |  | 2006               |           |  | 2005    |   |         | % Change | 
|                        |  | (In thousands)     |           |  |         |  
|                       
|Instruments Business    |  | $                  | 746,512   |  |         | $ | 737,268 |          |  |  | 1  | %
|Communications Business |  |                    | 319,664   |  |         |   | 208,040 |          |  |  | 54 | %
|                        |  |                    |           |  |         |   |         |          |  |  |    |  
|Total product orders    |  | $                  | 1,066,176 |  |         | $ | 945,308 |          |  |  | 13 | %
|                        |  |                    |           |  |         |   |         |          |  |  |    |  













Instruments
    Business










30



---



##### Table of Contents



Communications
    Business




















|                     |  |                    |           |  |         |   |         |          |  |  |    |  
|-------------------- |  | ------------------ | --------- |  | ------- | - | ------- | -------- |  |  | -- | -
|                     |  | Fiscal Years Ended |           |  |         |  
|                     |  | May 27,            |           |  | May 28, |   |         |          | 
|                     |  | 2006               |           |  | 2005    |   |         | % Change | 
|                     |  | (In thousands)     |           |  |         |  
|                    
|United States        |  | $                  | 358,988   |  |         | $ | 319,136 |          |  |  | 12 | %
|International        |  |                    | 707,188   |  |         |   | 626,172 |          |  |  | 13 | %
|                     |  |                    |           |  |         |   |         |          |  |  |    |  
|Total product orders |  | $                  | 1,066,176 |  |         | $ | 945,308 |          |  |  | 13 | %
|                     |  |                    |           |  |         |   |         |          |  |  |    |  









Net
    Sales










31



---



##### Table of Contents



Gross
    Profit and Gross Margin
      step-up
  Operating
    Expenses
   32




---



##### Table of Contents



2006


2005(In thousands)Inet Acquisition:Write-off of IPR&D

$



$
32,237Amortization of acquired intangible
    assets


5,117



3,414Amortization of unearned
    stock-based compensation


339



785Transition costs


1,955



2,224Sony/Tektronix Redemption:Transition costs


447



2,893Other acquisitions:Write-off of IPR&D


365



Amortization of acquired intangible
    assets


77



Transition costs


267



Acquisition related costs (credits)
    and amortization

$
8,567


$
41,553    33




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##### Table of Contents



Non-Operating
    Income/Expense
        Income
    Taxes
      Discontinued
    Operations
   34




---



##### Table of Contents



Net
    Earnings
    Earnings
    Per Share
    Fiscal
    Year 2005 Compared to Fiscal Year 2004
    Economic
    Conditions
          Acquisition
    of Inet Technologies, Inc.
    Discontinuation
    of Rohde and Schwarz Distribution Agreement
   35




---



##### Table of Contents



Product
    Orders
    Fiscal Years EndedMay 28,


May 29,2005


2004


% Change(In thousands)Instruments Business

$
737,268


$
682,331



8
%Communications Business


208,040



225,426



(8
)%Total product orders

$
945,308


$
907,757



4
%       Instruments
    Business
      Communications
    Business
     36




---



##### Table of Contents



Fiscal Years EndedMay 28,


May 29,2005


2004


% Change(In thousands)United States

$
319,136


$
374,094



(15
)%International


626,172



533,663



17
%Total product orders

$
945,308


$
907,757



4
%     Net
    Sales
       37




---



##### Table of Contents



Gross
    Profit and Gross Margin
    year-over-year
      Operating
    Expenses
       38




---



##### Table of Contents



2005


2004(In thousands)Inet Acquisition:Write-off of IPR&D

$
32,237


$
Amortization of acquired intangible
    assets


3,414



Amortization of unearned
    stock-based compensation


785



Transition costs


2,224



Sony/Tektronix Redemption:Gain on Japan pension restructuring






(36,741
)Gain on sale of Shinagawa, Japan
    property






(22,525
)Other Shinagawa, Japan asset
    disposals






216Impairment of Gotemba, Japan
    property
    held-for-sale






3,063Transition costs


2,893



4,962Acquisition related costs (credits)
    and amortization

$
41,553


$
(51,025
)  39




---



##### Table of Contents



Non-Operating
    Income/Expense
        Income
    Taxes
      Discontinued
    Operations
     40




---



##### Table of Contents



Net
    Earnings
    Earnings
    Per Share
    Liquidity
    and Capital Resources
  Sources
    and Uses of Cash
  Cash Flows.
  2006


2005(In thousands)Cash provided by (used in):Operating activities

$
95,541


$
90,328Investing activities


77,230



97,440Financing activities


(88,665
)


(207,057
)   Operating Activities.
  Form 10-K
   41




---



##### Table of Contents



Investing Activities.
    Form 10-K
        Financing Activities.
           42




---



##### Table of Contents



Contractual
    Obligations
      Total


2007


2008


2009


2010


2011


Thereafter(In thousands)Operating leases (1)

$
63,842


$
19,720


$
16,881


$
12,391


$
9,520


$
2,320


$
3,010Non-cancelable purchase
    commitments (1)


131,819



130,921



732



166











Defined contribution plan in
    Japan (2)


8,385



1,677



1,677



1,677



1,677



1,677



Employee severance (3)


5,494



5,494



















$
209,540


$
157,812


$
19,290


$
14,234


$
11,197


$
3,997


$
3,010     (1)
    
    The non-cancelable operating leases
    and purchase commitments are not reflected on the consolidated
    balance sheet under accounting principles generally accepted in
    the United States of America.(2)
    
    Represents the current balance of
    the funding commitment upon establishment of the defined
    contribution plan to be paid in annual installments over a
    remaining period of five years.(3)
    
    Represents the current balance of
    employee severance obligations from business realignment
    actions. The majority of the payments are expected to be paid
    within the next fiscal year; however, payments outside of the
    United States, especially in Europe, may extend beyond one year.  Working
    Capital
    2006


2005(In thousands)Current assets:Cash and cash equivalents

$
215,587


$
131,640Short-term marketable investments


121,346



120,881Trade accounts receivable, net of
    allowance for doubtful accounts of $3,079 and $3,406,
    respectively


174,599



155,332Inventories


156,351



131,096Other current assets


69,002



80,177Total current assets


736,885



619,126Current liabilities:Accounts payable and accrued
    liabilities


133,323



115,058Accrued compensation


71,718



78,938Deferred revenue


66,677



57,509Total current liabilities


271,718



251,505Working capital

$
465,167


$
367,621  43




---



##### Table of Contents



Recent
    Accounting Pronouncements
    fair-value-based fair-value-based
   44




---



##### Table of Contents



143-1, 143-1 143-1 FAS 143-1
  FAS 115-1 FAS 124-1, Other-Than-Temporary FAS 115-1 FAS 124-1 other-than-temporary other-than-temporary FAS 115-1 FAS 124-1
   45




---



##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk  Financial
    Market Risk
       46




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data.  REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
              Internal Control 
    Integrated Framework
  Deloitte
    & Touche llp
     47




---



##### Table of Contents



Consolidated
    Statements of Operations
  For the Fiscal Years EndedMay 27,


May 28,


May 29,2006


2005


2004(In thousands, except per share amounts)Net sales

$
1,039,870


$
1,034,654


$
920,620Cost of sales


418,428



415,878



397,577Gross profit


621,442



618,776



523,043Research and development expenses


183,414



163,474



130,386Selling, general and administrative
    expenses


302,344



300,925



277,993Business realignment costs


9,847



3,100



22,765Acquisition related costs (credits)
    and amortization


8,567



41,553



(51,025
)Loss (gain) on disposition of
    assets, net


(1,433
)


(1,700
)


1,134Operating income


118,703



111,424



141,790Interest income


13,585



17,144



21,565Interest expense


(483
)


(820
)


(2,208
)Other non-operating income
    (expense), net


(3,377
)


(3,564
)


6,165Earnings before taxes


128,428



124,184



167,312Income tax expense


37,536



45,333



49,087Net earnings from continuing
    operations


90,892



78,851



118,225Gain (loss) from discontinued
    operations, net of income taxes


1,463



2,745



(2,130
)Net earnings

$
92,355


$
81,596


$
116,095Earnings (loss) per share:Continuing operations 
    basic

$
1.09


$
0.91


$
1.40Continuing operations 
    diluted

$
1.08


$
0.89


$
1.37Discontinued operations 
    basic

$
0.02


$
0.03


$
(0.03
)Discontinued operations 
    diluted

$
0.02


$
0.03


$
(0.02
)Net earnings  basic

$
1.11


$
0.94


$
1.37Net earnings  diluted

$
1.09


$
0.93


$
1.35Weighted average shares outstanding:Basic


83,323



86,803



84,720Diluted


84,381



88,151



86,038Cash dividends declared per share

$
0.24


$
0.22


$
0.12    48




---



##### Table of Contents



Consolidated
    Balance Sheets
  May 27,


May 28,2006


2005(In thousands)ASSETSCurrent assets:Cash and cash equivalents

$
215,587


$
131,640Short-term marketable investments


121,346



120,881Trade accounts receivable, net of
    allowance for doubtful accounts of $3,079 and $3,406,
    respectively


174,599



155,332Inventories


156,351



131,096Other current assets


69,002



80,177Total current assets


736,885



619,126Property, plant and equipment, net


127,510



120,546Long-term marketable investments


103,839



226,892Deferred tax assets






56,560Goodwill, net


307,189



301,934Pension asset


239,128



868Other long-term assets


119,539



134,417Total assets

$
1,634,090


$
1,460,343LIABILITIES AND
    SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued
    liabilities

$
133,323


$
115,058Accrued compensation


71,718



78,938Deferred revenue


66,677



57,509Total current liabilities


271,718



251,505Deferred income taxes


65,935



Long-term liabilities


108,868



223,015Commitments and contingencies
    (Note 17)






Shareholders equity:Preferred stock, no par value
    (authorized 1,000 shares; none issued)






Common stock, no par value
    (authorized 200,000 shares; issued and outstanding 83,719
    and 85,144, respectively)


540,718



501,886Retained earnings


620,465



639,720Accumulated other comprehensive
    income (loss)


26,386



(155,783
)Total shareholders equity


1,187,569



985,823Total liabilities and
    shareholders equity

$
1,634,090


$
1,460,343    49




---



##### Table of Contents



Consolidated
    Statements of Cash Flows
  For the Fiscal Years EndedMay 27,


May 28,


May 29,2006


2005


2004(In thousands)CASH FLOWS FROM OPERATING ACTIVITIESNet earnings

$
92,355


$
81,596


$
116,095Adjustments to reconcile net
    earnings to net cash provided by operating activities:Amortization of acquisition related
    intangible assets


24,121



15,743



Depreciation and amortization
    expense


27,977



29,157



29,796Tax benefit of stock option
    exercises


8,401



3,931



6,983Deferred income tax expense


12,567



19,323



2,428Loss (gain) from discontinued
    operations


(1,463
)


(2,745
)


2,130Net gain on the
    disposition/impairment of assets


(1,433
)


(2,613
)


(18,312
)Write-off of in-process research
    and development


365



32,237



Gain on Japan pension restructuring










(36,741
)Net loss (gain) on the disposition
    of marketable equity securities


90



(2,696
)


(7,293
)Changes in operating assets and
    liabilities:Trade accounts receivable, net


(18,748
)


(3,678
)


(32,042
)Inventories


(25,253
)


(10,970
)


(8,306
)Other current assets


10,160



1,794



14,995Accounts payable and accrued
    liabilities


17,002



(38,521
)


30,218Accrued compensation


(7,233
)


(14,290
)


30,840Cash funding for defined benefit
    plans


(54,800
)


(49,318
)


(34,715
)Deferred revenue


9,093



16,487



5,696Other long-term assets and
    liabilities, net


877



14,891



31,288Net cash provided by continuing
    operating activities


94,078



90,328



133,060Net cash provided by discontinued
    operating activities


1,463







829Net cash provided by operating
    activities


95,541



90,328



133,889CASH FLOWS FROM INVESTING ACTIVITIESAcquisition of businesses, net of
    cash acquired


(8,040
)


(93,949
)


Acquisition of property, plant and
    equipment


(36,283
)


(32,464
)


(18,617
)Proceeds from the disposition of
    property and equipment


2,495



19,802



49,729Proceeds from the sale of corporate
    equity securities


10



4,404



9,530Proceeds from maturities and sales
    of marketable investments


185,987



307,859



460,650Purchases of short-term and
    long-term marketable investments


(66,939
)


(108,212
)


(513,018
)Net cash provided by (used in)
    investing activities


77,230



97,440



(11,726
)CASH FLOWS FROM FINANCING ACTIVITIESRepayment of long-term debt


(353
)


(425
)


(118,498
)Dividends paid


(20,014
)


(19,362
)


(10,176
)Proceeds from employee stock plans


52,496



21,157



33,860Repurchase of common stock


(120,794
)


(208,427
)


(72,380
)Net cash used in financing
    activities


(88,665
)


(207,057
)


(167,194
)Effect of exchange rate changes on
    cash


(159
)


1,918



3,655Net increase (decrease) in cash and
    cash equivalents


83,947



(17,371
)


(41,376
)Cash and cash equivalents at
    beginning of period


131,640



149,011



190,387Cash and cash equivalents at end of
    period

$
215,587


$
131,640


$
149,011    50




---



##### Table of Contents



Consolidated
    Statements of Shareholders Equity
  AccumulatedOtherCommon Stock


Retained


ComprehensiveShares


Amount


Earnings


Income (Loss)


Total(In thousands)Balance May 31, 2003


84,844


$
223,233


$
707,191


$
(151,198
)

$
779,226Components of comprehensive income
    (loss):Net earnings










116,095







116,095Minimum pension liability (net of
    tax of $9,661)














13,924



13,924Currency adjustment














10,482



10,482Unrealized holding loss (net of tax
    of ($5,292))














(8,276
)


(8,276
)Total comprehensive income


















132,225Dividends paid










(10,176
)






(10,176
)Shares issued to employees, net of
    forfeitures


1,991



33,860











33,860Tax benefit of stock option
    exercises






6,983











6,983Amortization of unearned
    stock-based compensation






842











842Shares repurchased in open market


(2,656
)


(7,651
)


(64,729
)






(72,380
)Balance May 29, 2004


84,179



257,267



748,381



(135,068
)


870,580Components of comprehensive income
    (loss):Net earnings










81,596







81,596Minimum pension liability (net of
    tax of ($15,745))














(24,689
)


(24,689
)Currency adjustment














6,935



6,935Unrealized holding loss (net of tax
    of ($1,892))














(2,961
)


(2,961
)Total comprehensive income


















60,881Dividends paid










(19,362
)






(19,362
)Shares issued to employees, net of
    forfeitures


1,191



21,157











21,157Shares issued in Inet acquisition


7,602



247,543











247,543Stock options and share rights
    assumed from Inet acquisition






9,979











9,979Unearned stock-based compensation
    from Inet acquisition






(3,403
)










(3,403
)Tax benefit of stock option
    exercises






3,931











3,931Amortization of unearned
    stock-based compensation






2,944











2,944Shares repurchased in open market


(7,828
)


(37,532
)


(170,895
)






(208,427
)Balance May 28, 2005


85,144



501,886



639,720



(155,783
)


985,823Components of comprehensive income
    (loss):Net earnings










92,355







92,355Minimum pension liability (net of
    tax of $109,907)














186,960



186,960Currency adjustment














(4,523
)


(4,523
)Unrealized holding loss (net of tax
    of ($158))














(268
)


(268
)Total comprehensive income


















274,524Dividends paid










(20,014
)






(20,014
)Shares issued to employees, net of
    forfeitures


3,316



52,496











52,496Shares issued in other acquisitions


87



2,075











2,075Tax benefit of stock option
    exercises






8,401











8,401Amortization of unearned
    stock-based compensation






5,058











5,058Shares repurchased in open market


(4,828
)


(29,198
)


(91,596
)






(120,794
)Balance May 27, 2006


83,719


$
540,718


$
620,465


$
26,386


$
1,187,569    51




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    The
    Company        2.
    Summary
    of Significant Accounting Policies  Financial
    statement presentation
    Use of
    estimates
  other-than-temporary;
  Cash
    and cash equivalents
    Trade
    accounts receivable, net
   52




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Marketable
    investments
    available-for-sale
  Inventories
  first-in,
  Property,
    plant and equipment
    Income
    taxes
      Goodwill
    and Intangible Assets
     53




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Impairment
    of long-lived assets
    Revenue
    recognition
       54




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Advertising
    Environmental
    costs
    Foreign
    currency translation
    Derivatives
       55




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   3.
    Recent
    Accounting Pronouncements    fair-value-based fair-value-based
       56




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    143-1, 143-1 143-1 FAS 143-1
  FAS 115-1 FAS 124-1, Other-Than-Temporary FAS 115-1 FAS 124-1 other-than-temporary other-than-temporary FAS 115-1 FAS 124-1
    4.  Earnings
    Per Share, Including Pro Forma Effects of Stock-Based
    Compensation
   57




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     2006


2005


2004(In thousands, except per share amounts)Net earnings

$
92,355


$
81,596


$
116,095Weighted average shares used for
    basic earnings per share


83,323



86,803



84,720Incremental dilutive stock options


1,058



1,348



1,318Weighted average shares used for
    diluted earnings per share


84,381



88,151



86,038Earnings per share:Net earnings  basic

$
1.11


$
0.94


$
1.37Net earnings  diluted

$
1.09


$
0.93


$
1.35         2006


2005


2004(In thousands, except per share amounts)Net earnings as reported

$
92,355


$
81,596


$
116,095Stock compensation cost included in
    net earnings as reported, net of income taxes


3,550



2,061



595Stock compensation cost using the
    fair value alternative, net of income taxes


(19,161
)


(17,427
)


(17,944
)Pro forma net earnings

$
76,744


$
66,230


$
98,746Earnings per share:Basic  as reported

$
1.11


$
0.94


$
1.37Basic  pro forma

$
0.92


$
0.76


$
1.17Diluted  as reported

$
1.09


$
0.93


$
1.35Diluted  pro forma

$
0.91


$
0.75


$
1.15  58




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   SFAS No. 123
    Assumptions
    2006


2005


2004Expected life in years


5.1



5.1



5.0Risk-free interest rate


4.18
%


3.68
%


2.96
%Volatility


31.55
%


32.76
%


31.45
%Dividend yield


0.85
%


0.82
%


0.48
%   5.
    Acquisitions  Inet
    Acquisition
        Cash paid

$
247,561Stock issued


247,543Stock options assumed


9,658Restricted share rights assumed


321Transaction costs


5,224Unearned stock-based compensation


(3,403
)Liabilities assumed


36,735Total purchase price

$
543,639  59




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Cash and cash equivalents

$
158,821Accounts receivable


18,504Inventories


18,025Tax benefit from transaction costs


1,209Other current assets


6,708Property, plant, and equipment


10,662Intangible assets


121,953Goodwill


219,653Other long term assets


811In-process research and development


32,237Deferred income taxes


(44,944
)Total assets acquired, net of
    deferred income taxes

$
543,639     (In years)Weighted Average




AccumulatedUseful Life

Cost


Amortization


Net(In thousands)Developed technology

4.8

$
87,004


$
(30,824
)

$
56,180Customer relationships

4.8


22,597



(8,031
)


14,566Covenants not to compete

4.0


1,200



(500
)


700Tradename

Not amortized


11,152







11,152Total intangible assets purchased



$
121,953


$
(39,355
)

$
82,598     2006


2005(In thousands)Cost of sales

$
18,495


$
12,329Acquisition related costs (credits)
    and amortization


5,117



3,414Total

$
23,612


$
15,743    60




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Acquisition RelatedCost of


Costs (Credits)Sales


and Amortization


Total(In thousands)Fiscal Year2007

$
18,495


$
5,117


$
23,6122008


16,670



4,621



21,2912009


15,759



4,174



19,9332010


5,256



1,354



6,610Total

$
56,180


$
15,266


$
71,446       2005


2004(In thousands, except per share amounts)Pro formaNet sales

$
1,071,333


$
1,033,346Net earnings


112,338



115,890Earnings per share:Basic

$
1.26


$
1.26Diluted

$
1.24


$
1.24      61




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Acquisition
    Related Costs (Credits) and Amortization
    2006


2005


2004(In thousands)Inet Acquisition:Write-off of IPR&D

$



$
32,237


$
Amortization of acquired intangible
    assets


5,117



3,414



Amortization of unearned
    stock-based compensation


339



785



Transition costs


1,955



2,224



Sony/Tektronix Redemption:Gain on Japan pension restructuring










(36,741
)Gain on sale of Shinagawa, Japan
    property










(22,525
)Other Shinagawa, Japan asset
    disposals










216Impairment of Gotemba, Japan
    property
    held-for-sale










3,063Transition costs


447



2,893



4,962Other acquisitions:Write-off of IPR&D


365







Amortization of acquired intangible
    assets


77







Transition costs


267







Acquisition related costs (credits)
    and amortization

$
8,567


$
41,553


$
(51,025
)   Inet Acquisition.
  Sony/Tektronix Redemption.
    6.
    Discontinued
    Operations    2006


2005


2004(In thousands)Loss on sale of VideoTele.com (less
    applicable income tax benefit of $1, $13, and $48)

$
(3
)

$
(23
)

$
(89
)Gain (loss) on sale of optical
    parametric test business (less applicable income tax benefit
    (expense) of ($338), $113, and $195)


629



(212
)


(363
)Gain (loss) on sale of Gage (less
    applicable income tax benefit (expense) of ($408), $182, and
    $692)


759



(337
)


(1,284
)Loss from operations of Gage (less
    applicable income tax benefit of $0, $0, and $212)










(394
)Gain on sale of Color Printing and
    Imaging (less applicable income tax expense of $42, $1,786, and
    $0) (see Note 17)


78



3,317



Gain (loss) from discontinued
    operations, net of income taxes

$
1,463


$
2,745


$
(2,130
)  62




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Sale
    of Color Printing and Imaging
    Sale
    of VideoTele.com
  available-for-sale
  Sale
    of Optical Parametric Test Business
    Sale
    of Gage Applied Sciences
   63




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    7.
    Business
    Realignment Costs             64




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     CostsBalance


Incurred








BalanceMay 28,


and Other


Cash


Non-cash


May 27,2005


Adjustments


Payments


Adjustments


2006(In thousands)Fiscal Year 2006
    Actions:Employee severance and related
    benefits

$



$
11,142


$
(6,275
)

$



$
4,867Contractual obligations






259



(259
)






Accumulated currency translation
    gain, net






(1,603
)






1,603



Total






9,798



(6,534
)


1,603



4,867Fiscal Year 2005
    Actions:Employee severance and related
    benefits


568



(143
)


(414
)






11Contractual obligations


103



49



(152
)






Total


671



(94
)


(566
)






11Fiscal Year 2004
    Actions:Employee severance and related
    benefits


681



98



(208
)


42



613Total


681



98



(208
)


42



613Fiscal Year 2003 and 2002
    Actions:Employee severance and related
    benefits


2











1



3Contractual obligations


926



45



(460
)






511Total


928



45



(460
)


1



514Total of all actions

$
2,280


$
9,847


$
(7,768
)

$
1,646


$
6,005  65




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     CostsBalance


Incurred








BalanceMay 29,


and Other


Cash


Non-cash


May 28,2004


Adjustments


Payments


Adjustments


2005(In thousands)Fiscal Year 2005
    Actions:Employee severance and related
    benefits

$



$
2,447


$
(1,879
)

$



$
568Asset impairments






345







(345
)


Contractual obligations






525



(639
)


217



103Accumulated currency translation
    gain, net






(236
)






236



Total






3,081



(2,518
)


108



671Fiscal Year 2004
    Actions:Employee severance and related
    benefits


5,335



(235
)


(4,419
)






681Asset impairments






(97
)






97



Contractual obligations


409



327



(737
)


1



Total


5,744



(5
)


(5,156
)


98



681Fiscal Year 2003
    Actions:Employee severance and related
    benefits


294



(20
)


(272
)






2Contractual obligations


1,240



35



(479
)


109



905Total


1,534



15



(751
)


109



907Fiscal Year 2002
    Actions:Employee severance and related
    benefits


152



9



(161
)






Contractual obligations


54







(33
)






21Total


206



9



(194
)






21Total of all actions

$
7,484


$
3,100


$
(8,619
)

$
315


$
2,280  66




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     CostsBalance


Incurred








BalanceMay 31,


and Other


Cash


Non-cash


May 29,2003


Adjustments


Payments


Adjustments


2004(In thousands)Fiscal Year 2004
    Actions:Employee severance and related
    benefits

$



$
17,351


$
(12,016
)

$



$
5,335Asset impairments






1,610







(1,610
)


Contractual obligations






1,514



(1,105
)






409Accumulated currency translation
    loss, net






2,594







(2,594
)


Total






23,069



(13,121
)


(4,204
)


5,744Fiscal Year 2003
    Actions:Employee severance and related
    benefits


5,394



(623
)


(4,477
)






294Asset impairments






(53
)






53



Contractual obligations


1,730



447



(1,085
)


148



1,240Total


7,124



(229
)


(5,562
)


201



1,534Fiscal Year 2002
    Actions:Employee severance and related
    benefits


494



172



(514
)






152Contractual obligations


434



(57
)


(323
)






54Total


928



115



(837
)






206Other






(190
)


(9
)


199



Total of all actions

$
8,052


$
22,765


$
(19,529
)

$
(3,804
)

$
7,484   8.
    Marketable
    Investments      Amortized Cost


Unrealized Gains


Unrealized Losses


Market Value(In thousands)Asset backed securities

$
40,071


$
6


$
(241
)

$
39,836U.S. Agencies


27,340







(328
)


27,012Corporate notes and bonds


23,841



9



(67
)


23,783Commercial paper


21,568











21,568Mortgage backed securities


6,802







(187
)


6,615Certificates of deposit


2,517







(2
)


2,515U.S. Treasuries


17











17Short-term marketable investments

$
122,156


$
15


$
(825
)

$
121,346  67




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Amortized Cost


Unrealized Gains


Unrealized Losses


Market Value(In thousands)Asset backed securities

$
37,595


$



$
(901
)

$
36,694U.S. Agencies


13,561







(340
)


13,221Corporate notes and bonds


20,223







(686
)


19,537Mortgage backed securities


30,252







(1,305
)


28,947U.S. Treasuries


5,634







(194
)


5,440Long-term marketable investments

$
107,265


$



$
(3,426
)

$
103,839     Amortized Cost


Unrealized Gains


Unrealized Losses


Market Value(In thousands)Asset backed securities

$
12,290


$



$
(103
)

$
12,187U.S. Agencies


31,109







(189
)


30,920Corporate notes and bonds


48,245



14



(274
)


47,985Mortgage backed securities


1,840







(26
)


1,814U.S. Treasuries


28,150







(175
)


27,975Short-term marketable investments

$
121,634


$
14


$
(767
)

$
120,881     Amortized Cost


Unrealized Gains


Unrealized Losses


Market Value(In thousands)Asset backed securities

$
70,667


$
238


$
(418
)

$
70,487U.S. Agencies


42,962







(718
)


42,244Corporate notes and bonds


48,535



45



(555
)


48,025Mortgage backed securities


53,622



4



(1,006
)


52,620U.S. Treasuries


13,491



83



(58
)


13,516Long-term marketable investments

$
229,277


$
370


$
(2,755
)

$
226,892     Amortized CostBasis(In thousands)After 1 year through
    5 years

$
77,013Mortgage backed securities


30,252$
107,265   other-than-temporary, other-than-temporary.
 68




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     12 Months or More


Less Than 12 Months


TotalGross





Gross





GrossEstimated





Estimated





EstimatedMarket


Unrealized


Market


Unrealized


Market


UnrealizedValue


Losses


Value


Losses


Value


Losses(In thousands)Asset backed securities

$
37,340


$
(668
)

$
32,568


$
(474
)

$
69,908


$
(1,142
)U.S. Agencies


35,287



(655
)


4,946



(13
)


40,233



(668
)Mortgage backed securities


29,383



(1,228
)


6,179



(264
)


35,562



(1,492
)Corporate notes and bonds


21,977



(596
)


11,779



(156
)


33,756



(752
)U.S. Treasuries


3,522



(142
)


1,934



(52
)


5,456



(194
)Certificates of deposit










2,515



(3
)


2,515



(3
)Total

$
127,509


$
(3,289
)

$
59,921


$
(962
)

$
187,430


$
(4,251
)   9.
    Concentrations
    of Risk  Credit
    Risk
    Supplier
    Risk
    10.
    Inventories    2006


2005(In thousands)Materials

$
8,252


$
7,015Work in process


72,663



63,091Finished goods


75,436



60,990Inventories

$
156,351


$
131,096  69




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   11.
    Other
    Current Assets    2006


2005(In thousands)Current deferred tax asset

$
45,686


$
49,537Prepaid expenses


12,776



12,877Income taxes receivable


1,772



9,928Other receivables


8,343



7,401Notes receivable


12



18Other current assets


413



416Other current assets

$
69,002


$
80,177   12.
    Property,
    Plant and Equipment, Net    2006


2005(In thousands)Land

$
698


$
1,086Buildings


135,727



129,983Machinery and equipment


258,137



246,032Accumulated depreciation and
    amortization


(267,052
)


(256,555
)Property, plant and equipment, net

$
127,510


$
120,546     13.
    Goodwill,
    Net     70




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Balance at May 29, 2004

$
79,774Acquisition of Inet (Note 5)


220,883Currency translation


1,277Balance at May 28, 2005


301,934Inet purchase price adjustment


(1,230
)Other acquisitions


7,428Currency translation


(943
)Balance at May 27, 2006

$
307,189     14.
    Other
    Long-Term Assets    2006


2005(In thousands)Intangibles, net

$
86,805


$
107,652Notes, contracts and leases


18,476



12,377Corporate equity securities


8,923



8,285Other long-term assets


5,335



6,103Other long-term assets

$
119,539


$
134,417       available-for-sale available-for-sale
  2006


2005(In thousands)Cost basis of corporate equity
    securities

$
4,282


$
4,282Gross unrealized holding gains


4,641



4,003Fair value of corporate equity
    securities

$
8,923


$
8,285  71




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   15.
    Accounts
    Payable and Accrued Liabilities    2006


2005(In thousands)Trade accounts payable

$
50,910


$
36,407Other accounts payable


44,719



35,444Accounts payable


95,629



71,851Income taxes payable


16,181



17,348Contingent liabilities
    (Note 17)


8,785



10,539Warranty reserve (Note 24)


5,798



6,508Accrued expenses and other
    liabilities


6,930



8,812Accrued liabilities


37,694



43,207Accounts payable and accrued
    liabilities

$
133,323


$
115,058       16.
    Long-Term
    Liabilities    2006


2005(In thousands)Pension liability

$
66,147


$
174,841Deferred compensation


14,584



15,708Postretirement benefits


12,106



12,828Other long-term liabilities


16,031



19,638Long-term liabilities

$
108,868


$
223,015    72




---



##### Table of Contents





NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)






|    |                                  
|--- | ---------------------------------
|17. | Commitments
    and Contingencies



Commitments








|             |  |                |        |  |             |   |         | 
|------------ |  | -------------- | ------ |  | ----------- | - | ------- | 
|             |  | Operating      |        |  | Purchase    |  
|             |  | Leases         |        |  | Commitments |  
|             |  | (In thousands) |       
|            
|Fiscal Year  |  |                |        |  |             |   |         | 
|2007         |  | $              | 19,720 |  |             | $ | 130,921 | 
|2008         |  |                | 16,881 |  |             |   | 732     | 
|2009         |  |                | 12,391 |  |             |   | 166     | 
|2010         |  |                | 9,520  |  |             |   |        | 
|2011         |  |                | 2,320  |  |             |   |        | 
|Future years |  |                | 3,010  |  |             |   |        | 
|             |  |                |        |  |             |   |         | 
|Total        |  | $              | 63,842 |  |             | $ | 131,819 | 
|             |  |                |        |  |             |   |         | 





Contingencies








Sale
    of Color Printing and Imaging










73



---



##### Table of Contents





NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)




























Environmental
    and Other






74



---



##### Table of Contents





NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)




















|    |                                        
|--- | ---------------------------------------
|18. | Fair
    Value of Financial Instruments







|    |                             
|--- | ----------------------------
|19. | Stock
    Compensation Plans



Stock
    options






75



---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Equity Compensation Plan InformationNumber of Securities





Number of Securitiesto be Issued Upon


Weighted Average


Remaining AvailableExercise of Outstanding


Exercise Price of


for Future IssuanceOptions,


Outstanding Options,


(Excluding SharesWarrants and Rights


Warrants and Rights


Listed in (a))Plan Category

(a)


(b)


(c)Equity Compensation Plans Approved
    by Shareholders2005 Stock Incentive Plan


646,412


$
29.79



2,457,6962002 Stock Incentive Plan


6,297,696


$
25.50



1,771,5301998 Stock Option Plan


1,257,705


$
22.39



1989 Stock Incentive Plan


2,927,963


$
29.39



Employee Stock Purchase
    Plan (1)






n/a



1,258,007Equity Compensation Plan Not
    Approved by Shareholders2001 Stock Option Plan (2)


23,637


$
25.69



Total (3)


11,153,413


$
26.42



5,487,233     (1)
    
    As of May 27, 2006 employees
    had contributed $3.1 million for the purchase period ending
    July 14, 2006. Contributions are held as cash until the
    last day of the purchase period when shares are purchased by the
    employees.(2)
    
    This plan was adopted by the Board
    of Directors for the sole purpose of making grants to new
    non-officer employees who join the Company as a result of
    acquisitions, and grants were limited to such non-officer
    employees. Options with a term of 10 years were granted at
    fair market value at the time of grant. The terms of the options
    are substantially the same as the options granted under plans
    approved by shareholders. The Board of Directors terminated this
    Plan, therefore there will be no further grants.(3)
    
    These totals do not include
    information relating to the Inet Stock Option Plan, which was
    approved by the shareholders of Inet Technologies, Inc. and
    assumed by the Company in a transaction approved by shareholders
    of Inet. No additional grants will be made under this plan. The
    applicable information for the Inet Stock Option Plan is as
    follows: (i) 780,157 securities are issuable upon exercise
    of outstanding options and 4,180 rights; (ii) the weighted
    average exercise price of outstanding options, warrants and
    rights is $61.37; and (iii) no securities are available for
    future issuance.    Outstanding


ExercisableNumber of





Number ofShares in


Weighted Average


Shares in


Weighted AverageThousands


Exercise Price


Thousands


Exercise PriceMay 31, 2003


11,100


$
22.87



4,914


$
23.49Granted


2,360



30.99Exercised


(1,604
)


18.05Cancelled


(641
)


24.69May 29, 2004


11,215



25.16



5,135



25.17Granted


4,377



36.89Exercised


(819
)


19.49Cancelled


(596
)


44.51May 28, 2005


14,177



28.29



7,452



29.57Granted


875



28.63Exercised


(2,201
)


20.93Cancelled


(917
)


32.36May 27, 2006


11,934


$
29.06



7,473


$
29.55  76




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Outstanding


ExercisableWeightedAverage


Weighted





WeightedNumber of


Remaining


Average


Number of


AverageRange of Exercise


Shares in


Contractual


Exercise


Shares in


ExercisePrices


Thousands


Life (years)


Price


Thousands


Price$
10.97 -  $ 20.06



2,787



5.55


$
18.15



2,247


$
18.3120.08 -    28.57



2,034



6.16



24.33



1,822



24.2628.58 -    28.69



2,286



8.64



28.69



521



28.6928.70 -    31.55



2,577



8.19



30.99



881



31.45$
31.64 -  $176.32



2,250



5.26



45.02



2,002



46.3611,934



6.76


$
29.06



7,473


$
29.55     Employee
    Stock Purchase Plan
      20.
    Shareholders
    Equity  Repurchase
    of Common Stock
     77




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Shareholder
    Rights Agreement
  two-for-one
  Accumulated
    Other Comprehensive Income (Loss)
    Unrealized





AccumulatedHolding Gains


Additional


OtherForeign


on Available-


Minimum


ComprehensiveCurrency


for-Sale


Pension


IncomeTranslation


Securities


Liability


(Loss)(In thousands)Balance as of May 29, 2004

$
35,192


$
3,488


$
(173,748
)

$
(135,068
)Fiscal year 2005 activity


6,935



(2,961
)


(24,689
)


(20,715
)Balance as of May 28, 2005


42,127



527



(198,437
)


(155,783
)Fiscal year 2006 activity


(4,523
)


(268
)


186,960



182,169Balance as of May 27, 2006

$
37,604


$
259


$
(11,477
)

$
26,386   21.
    Derivative
    Financial Instruments and Hedging Activities     78




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    marked-to-market
    22.
    Business
    Segments    2006


2005


2004(In thousands)Consolidated net sales to
    external customers by groups of similar products:Instruments Business

$
788,773


$
812,692


$
710,549Communications Business


251,097



221,962



210,071Net sales

$
1,039,870


$
1,034,654


$
920,620Consolidated net sales to
    external customers by region:The AmericasUnited States

$
361,688


$
392,755


$
386,369Other Americas


30,449



31,843



27,704Europe


286,756



241,823



190,235Pacific


196,759



198,911



167,651Japan


164,218



169,322



148,661Net sales

$
1,039,870


$
1,034,654


$
920,620Operating income:Continuing operations

$
137,117


$
156,077


$
113,530Less:Business realignment costs


9,847



3,100



22,765Acquisition related costs (credits)
    and amortization


8,567



41,553



(51,025
)Operating income

$
118,703


$
111,424


$
141,790Long-lived assets:United States

$
679,301


$
447,860


$
106,383International


114,065



109,905



109,526Long-term marketable investments


103,839



226,892



463,878Deferred tax assets






56,560



105,886Long-lived assets

$
897,205


$
841,217


$
785,673  79




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   23.
    Other
    Non-Operating Income (Expense), Net  2006


2005


2004(In thousands)Gain (loss) on sale of corporate
    equity securities

$
(90
)

$
2,696


$
7,293Gain (loss) on disposition of
    financial assets


35



(825
)


(120
)Currency gains (losses)


(259
)


(1,047
)


659Other expense, net


(3,063
)


(4,388
)


(1,667
)Other non-operating income
    (expense), net

$
(3,377
)

$
(3,564
)

$
6,165         24.
    Product
    Warranty Accrual      Balance, May 29, 2004

$
8,959Payments made


(9,523
)Provision for warranty expense


7,072Balance, May 28, 2005


6,508Payments made


(9,777
)Provision for warranty expense


9,067Balance, May 27, 2006

$
5,798  80




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   25.
    Income
    Taxes    2006


2005


2004(In thousands)Current:Federal

$
17,790


$
15,910


$
39,338State


1,086



3,360



1,434Non - U.S.


13,026



6,740



5,88731,902



26,010



46,659Deferred:Federal


9,799



21,003



6,015State


532



(817
)


1,509Non - U.S.


(4,697
)


(863
)


(5,096
)5,634



19,323



2,428Total income tax expense

$
37,536


$
45,333


$
49,087     2006


2005


2004(In thousands)Income taxes based on
    U.S. statutory rate

$
44,950


$
43,464


$
58,559State income taxes, net of
    U.S. tax


1,052



1,653



1,913Extraterritorial income exclusion


(3,150
)


(2,504
)


(1,413
)Changes in valuation allowance


(4,838
)


(16,664
)


(1,776
)Reversal of prior fiscal
    years provisions


(2,005
)






(6,306
)Nondeductible charge for
    in-progress R&D


128



11,283



Domestic manufacturers
    deduction


(1,193
)






Change in enacted state and local
    tax rate


2,355







Other  net


237



8,101



(1,890
)Total income tax expense

$
37,536


$
45,333


$
49,087        81




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     2006


2005(In thousands)Other current assets

$
45,686


$
49,537Deferred tax assets






56,560Deferred tax liabilities


(65,935
)


Net deferred tax assets
    (liabilities)

$
(20,249
)

$
106,097     2006


2005(In thousands)Deferred tax assets:Reserves and other liabilities

$
41,585


$
43,670Accrued pension obligation






44,036Foreign tax credit carryforwards






6,519Accumulated depreciation


11,211



11,557Inventory


8,834



10,184Net operating loss carryforwards


10,769



6,822Other credit carryforwards


2,922



18,871Accrued postretirement benefits


5,219



5,783Lease obligation


2,393



4,409Restructuring costs and separation
    programs


522



1,683Unrealized gains on marketable
    equity securities


297



Gross deferred tax assets


83,752



153,534Less: valuation allowance


(1,681
)


(6,519
)Deferred tax assets

$
82,071


$
147,015Deferred tax
    liabilities:Accrued pension obligation

$
(71,775
)

$
Intangibles


(30,330
)


(39,945
)Software development costs


(215
)


(637
)Unrealized gains on marketable
    equity securities






(336
)Deferred tax liabilities


(102,320
)


(40,918
)Net deferred tax assets
    (liabilities)

$
(20,249
)

$
106,097      82




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      26.
    Benefit
    Plans  Pension
    and postretirement benefit plans
   83




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Pension


Pension


Postretirement


PostretirementBenefits


Benefits


Benefits


Benefits2006


2005


2006


2005(In thousands)Change in Benefit
    ObligationBeginning balance

$
728,739


$
661,646


$
16,261


$
15,198Service cost


7,050



6,336



96



84Interest cost


36,624



38,079



856



904Actuarial (gain) loss


(22,110
)


65,394



(394
)


2,074Curtailment/settlement


(3,118
)


(577
)






Benefit payments


(46,493
)


(44,454
)


(1,675
)


(1,999
)Exchange rate changes


1,821



2,187







Participant contributions


108



128







Ending balance

$
702,621


$
728,739


$
15,144


$
16,261Change in Plan AssetsBeginning balance

$
543,864


$
479,698


$



$
Actual return


71,387



56,379







Employer contributions


60,042



51,774



1,675



1,999Benefit payments


(46,493
)


(44,454
)


(1,675
)


(1,999
)Participant contributions


108



128







Curtailment/settlement


(335
)


(546
)






Exchange rate changes


1,757



885







Ending balance

$
630,330


$
543,864


$



$
Net underfunded status of the plan

$
(72,291
)

$
(184,875
)

$
(15,144
)

$
(16,261
)Unrecognized initial net obligation


541



231







Unrecognized prior service cost


(7,337
)


(9,800
)






Unrecognized net loss


277,237



342,533



1,038



1,433Net prepaid (liability) recognized

$
198,150


$
148,089


$
(14,106
)

$
(14,828
)Amounts recognized on the
    consolidated balance sheetsPension assets

$
239,128


$
868


$



$
Long-term liabilities


(66,147
)


(174,841
)


(12,106
)


(12,828
)Accrued compensation










(2,000
)


(2,000
)Accumulated other comprehensive loss


25,169



322,062







Net prepaid (liability) recognized

$
198,150


$
148,089


$
(14,106
)

$
(14,828
)    84




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Pension


PensionBenefits


Benefits2006


2005(In thousands)Projected benefit obligation

$
118,481


$
728,739Accumulated benefit obligation


115,492



718,111Fair value of plan assets


51,567



543,864             Pension


PostretirementBenefit


Benefit


Total(In thousands)Fiscal
    Year2007

$
41,868


$
1,296


$
43,1642008


42,085



1,296



43,3812009


42,568



1,305



43,8732010


43,320



1,302



44,6222011


44,545



1,304



45,8492012  2016


239,049



6,457



245,506Total

$
453,435


$
12,960


$
466,395  85




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     2006


2005Equity investments


74
%


72
%Debt securities


17



19Real estate


8



8Other


1



1100
%


100
%       2006


2005


2004(In thousands)Pension Benefit:Service cost

$
7,050


$
6,336


$
7,169Interest cost


36,624



38,079



37,824Expected return on plan assets


(49,493
)


(49,698
)


(50,793
)Amortization of transition asset


156



118



111Amortization of prior service cost


(2,300
)


(2,298
)


(2,069
)Curtailment/settlement loss


(2,221
)


(193
)


Amortization of unrecognized net
    loss


21,104



13,542



11,174Net benefit expense

$
10,920


$
5,886


$
3,416Postretirement
    Benefit:Service cost

$
96


$
84


$
104Interest cost


856



904



930Amortization of prior service cost










(2,671
)Net benefit expense (credit)

$
952


$
988


$
(1,637
)   Weighted
    Average Assumptions Used
    Pension Benefits


Postretirement Benefits2006


2005


2006


2005Discount rate


5.9%



5.3%



6.3%



5.5%Rate of compensation increase


3.4%



3.5%



3.6%



3.8%  86




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Pension Benefits


Postretirement Benefits2006


2005


2004


2006


2005


2004Discount rate


5.3%



6.1%



5.6%



6.3%



6.3%



6.0%Rate of compensation increase


3.5%



3.6%



3.5%



3.6%



3.8%



3.8%Expected long-term return on plan
    assets


8.3%



8.4%



8.1%



N/A



N/A



N/A             Employee
    savings plan
   87




---



##### Table of Contents



NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   27.
    Supplemental
    Cash Flow Information  May, 27,


May, 28,


May 29,2006


2005


2004(In thousands)Supplemental disclosure of cash
    flowsIncome taxes paid (refunded), net

$
8,932


$
34,669


$
(18,731
)Interest paid


254



335



3,367Non-cash transactions from Inet
    acquisitionCommon stock issued

$



$
247,543


$
Stock options assumed






9,658



Restricted share rights assumed






321



Unearned stock-based compensation






(3,403
)


Liabilities assumed


(2,298
)


39,033



Non-cash assets acquired, net of
    deferred income taxes


2,298



(387,101
)


Net cash paid for acquisition of
    Inet

$



$
(93,949
)

$
Other non-cash
    transactions:Common stock issued for acquisition

$
2,075


$



$
Note receivable for sale of property


1,250







  88




---



##### Table of Contents



Quarterly
    Financial Data (Unaudited)
    Quarter EndedMay 27,


Feb. 25,


Nov. 26,


Aug. 27,2006


2006


2005


2005Net sales

$
289,309


$
262,105


$
253,396


$
235,060Gross profit


174,158



159,102



152,225



135,957Operating income(a)


37,851



33,535



29,451



17,866Earnings before taxes


42,466



35,887



30,200



19,875Net earnings from continuing
    operations


31,908



24,938



19,878



14,168Gain (loss) from discontinued
    operations


(47
)


1,575



17



(82
)Net earnings

$
31,861


$
26,513


$
19,895


$
14,086Earnings per share:Continuing operations 
    basic

$
0.38


$
0.30


$
0.24


$
0.17Continuing operations 
    diluted

$
0.37


$
0.30


$
0.24


$
0.17Discontinued operations 
    basic and diluted

$



$
0.02


$



$
Net earnings  basic

$
0.38


$
0.32


$
0.24


$
0.17Net earnings  diluted

$
0.37


$
0.32


$
0.24


$
0.17Average shares outstanding:Basic


83,681



82,174



82,833



84,603Diluted


85,365



83,319



83,584



85,297Common stock prices:High

$
36.70


$
31.41


$
26.63


$
25.29Low


30.26



25.36



22.73



22.56   Quarter EndedMay 28,


Feb. 26,


Nov. 27,


Aug. 28,2005


2005


2004


2004Net sales

$
261,029


$
256,332


$
266,828


$
250,465Gross profit


156,548



153,386



160,323



148,519Operating income(a)


28,072



27,530



6,883



48,939Earnings before taxes


30,068



32,637



9,385



52,094Net earnings (loss) from continuing
    operations


21,573



23,391



(2,579
)


36,466Gain (loss) from discontinued
    operations


(372
)


3,430



(255
)


(58
)Net earnings (loss)

$
21,201


$
26,821


$
(2,834
)

$
36,408Earnings (loss) per share:Continuing operations 
    basic

$
0.25


$
0.26


$
(0.03
)

$
0.44Continuing operations 
    diluted

$
0.25


$
0.26


$
(0.03
)

$
0.43Discontinued operations 
    basic and diluted

$



$
0.04


$



$
Net earnings (loss) 
    basic

$
0.24


$
0.30


$
(0.03
)

$
0.43Net earnings (loss) 
    diluted

$
0.24


$
0.30


$
(0.03
)

$
0.43Average shares outstanding:Basic


87,103



89,307



87,020



83,782Diluted


87,840



90,690



87,020



85,211Common stock prices:High

$
29.10


$
31.95


$
33.99


$
34.94Low


21.17



28.00



28.35



26.49    89




---



##### Table of Contents



Notes to
    Quarterly Financial Data (Unaudited):
      Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure.    Item 9A.
    Controls
    and Procedures.  Evaluation
    of Disclosure Controls and Procedures
  Rule 13a-15(b)
  Managements
    Report on Internal Control over Financial
    Reporting
  Rule 13a-15(f) Internal Control  Integrated
    Framework
      Changes
    in Internal Control over Financial Reporting
  Rule 13a-15
  Chief
    Executive Officer and Chief Financial Officer
    Certifications
   90




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
      Internal Control  Integrated
    Framework
        Internal
    Control  Integrated Framework Internal Control  Integrated
    Framework
    Deloitte
    & Touche llp
    91




---



##### Table of Contents



Item 9B.Other
    Information.   PART III  Item 10.
    Directors
    and Executive Officers of the Registrant.      Regulation S-K
  Regulation S-K
  Item 11.
    Executive
    Compensation.    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters.    Item 13.
    Certain
    Relationships and Related Transactions.    Item 14.
    Principal
    Accounting Fees and Services.   92




---



##### Table of Contents



PART IV  Item 15.
    Exhibits
    and Financial Statement Schedules.  Form 10-K:
    Form 10-K:
  PageReport of Independent Registered
    Public Accounting Firm

47Consolidated Statements of
    Operations

48Consolidated Balance Sheets

49Consolidated Statements of Cash
    Flows

50Consolidated Statements of
    Shareholders Equity

51Notes to Consolidated Financial
    Statements

52 through 88     Form 10-K
  Schedule II 
    Valuation and Qualifying Accounts

Page 96         (3)

(i)

Restated Articles of Incorporation
    of the Company, as amended. Incorporated by reference to
    Exhibit 3(i) of
    Form 10-K
    filed August 12, 2004, SEC File No. 1-04837.(ii)

Bylaws of the Company, as amended.
    Incorporated by reference to Exhibit 3(ii) of
    Form 8-K
    filed May 9, 2005, SEC File No. 1-04837.(4)

(i)

Pursuant to
    Item 601(b)(4)(iii) of
    Regulation S-K,
    the registrant agrees to furnish to the Commission upon request
    copies of agreements relating to other indebtedness.(ii)

Rights Agreement dated as of
    June 21, 2000, between Tektronix, Inc. and ChaseMellon
    Shareholder Services, L.L.C. Incorporated by reference to
    Exhibit (4) of
    Form 8-K
    filed June 28, 2000, SEC File No. 1-04837.(10)

(i)

Stock Incentive Plan, as amended.
    Incorporated by reference to Exhibit 10(ii) of
    Form 10-Q
    filed April 12, 1993, SEC File No. 1-04837.(ii)

Restated Annual Performance
    Incentive Plan, as amended. Incorporated by reference to
    Exhibit 10(iii) of
    Form 10-Q
    filed October 14, 2003, SEC File No. 1-04837.(ii)(A)

Annual Performance Incentive
    Plan  Additional Information.(iii)

Change of Control Agreements. Form
    of agreement is incorporated by reference to
    Exhibit 10(viii) of
    Form 10-K
    dated August 18, 1993, SEC File No. 1-4837. Current
    list of covered executive officers is incorporated by reference
    to Exhibit 10.1 of
    Form 10-Q
    filed January 4, 2006. SEC File No. 1-04837.(iv)

Retirement Equalization Plan,
    Restatement. Incorporated by reference to Exhibit 10(v) of
    Form 10-K
    filed August 22, 1996, SEC File No. 1-04837.(v)

Indemnity Agreement entered into
    between the Company and certain named officers and directors.
    Incorporated by reference to Exhibit 10(ix) of
    Form 10-K
    filed August 20, 1993, SEC File No. 1-04837. 93




---



##### Table of Contents



(vi)

Executive Severance Agreement
    dated May 17, 2001 entered into between the Company and its
    Chief Executive Officer, Richard H. Wills. Incorporated by
    reference to Exhibit 10(vii) of
    Form 10-K
    filed August 2, 2001, SEC File No. 1-04837.(vii)

Form of Executive Severance
    Agreement entered into between the Company and each of its
    executive officers (other than the Chief Executive Officer).
    Incorporated by reference to Exhibit 10(vii) of
    Form 10-K
    filed August 12, 2004, SEC File No. 1-04837.(viii)

Tektronix, Inc. 2001 Non-Employee
    Directors Compensation Plan, 2005 Restatement, as amended
    March 15, 2006. Incorporated by reference to
    Exhibit 10.1 of
    Form 8-K
    filed March 20, 2006, SEC File No. 1-04837.(ix)

1998 Stock Option Plan, as
    amended. Incorporated by reference to Exhibit 10(i) of
    Form 10-Q
    filed October 8, 1999, SEC File No. 1-04837.(x)

Tektronix, Inc. Deferred
    Compensation Plan, 2005 Restatement, effective January 1,
    2005.(xi)

Tektronix, Inc. Stock Deferral
    Plan, 2005 Restatement, effective January 1, 2005.(xii)

Individual Cash Incentive
    Arrangements. Incorporated by reference to Exhibit 10(xii)
    of
    Form 10-K
    filed August 5, 2005, SEC File No. 1-04837.(xiii)

2001 Stock Option Plan.
    Incorporated by reference to Exhibit 10(xiv) of
    Form 10-K
    filed August 14, 2003, SEC File No. 1-04837.(xiv)

2002 Stock Incentive Plan, as
    amended. Incorporated by reference to Exhibit 10(xiv) of
    Form 10-K
    filed August 5, 2005, SEC File No. 1-04827.(xv)

Agreement and plan of merger dated
    as of June 29, 2004, among Tektronix, Inc., Inet
    Technologies, Inc., Impala Merger Corp. and Impala Acquisition
    Co. LLC. Incorporated by reference to Exhibit (2) of
    Form 8-K
    filed June 30, 2004, SEC File No. 1-04837.(xvi)

Form of Non-Statutory Stock Option
    Agreement for Executive Officers under the Tektronix 2005 Stock
    Incentive Plan. Incorporated by reference to Exhibit 10.2
    of
    Form 8-K
    filed January 23, 2006, SEC File No. 1-04837.(xvii)

Form of Restricted Stock Agreement
    for Executive Officers under the Tektronix 2005 Stock Incentive
    Plan. Incorporated by reference to Exhibit 10.1 of
    Form 8-K
    filed January 23, 2006, SEC File No. 1-04837.(xviii)

2005 Stock Incentive Plan.
    Incorporated by reference to appendix B to the Companys
    Proxy Statement dated August 18, 2005 for the 2005 Annual
    Meeting of Shareholders.(14)

(i)

Code of Ethics for Financial
    Managers. Incorporated by reference to Exhibit 14(i) of
    Form 10-K
    filed August 12, 2004, SEC File No. 1-04837.(ii)

Business Practices Guidelines,
    2007 Restatement, effective as of May 28, 2006.(21)



Subsidiaries of the registrant.(23)



Consent of Independent Registered
    Public Accounting Firm.(24)



Powers of Attorney.(31.1)



302 Certification, Chief Executive
    Officer.(31.2)



302 Certification, Chief Financial
    Officer.(32.1)



906 Certification, Chief Executive
    Officer.(32.2)



906 Certification, Chief Financial
    Officer.     
    
    Compensatory Plan or Arrangement 94




---



##### Table of Contents



SIGNATURES      By
    /s/ COLIN L. SLADE  Colin L. Slade, Senior Vice President and
  Chief Financial Officer
    Pursuant to the requirements of the Securities Exchange Act
    of 1934, this report has been signed below by the following
    persons on behalf of the registrant and in the capacities and on
    the dates indicated.
  Signature

Capacity

Date/s/   RICHARD H. WILLS*Richard
    H. Wills

Chairman of the Board, President,
    and
    Chief Executive Officer

August 2, 2006/s/  COLIN
    L. SLADEColin
    L. Slade

Senior Vice President and Chief
    Financial Officer, Principal Financial and 
    Accounting Officer

August 2, 2006/s/  PAULINE
    LO ALKER*Pauline
    Lo Alker

Director

August 2, 2006/s/  A.
    GARY AMES*A.
    Gary Ames

Director

August 2, 2006/s/  GERRY
    B. CAMERON*Gerry
    B. Cameron

Director

August 2, 2006/s/  DAVID
    N.
    CAMPBELL*David
    N. Campbell

Director

August 2, 2006/s/  FRANK
    C. GILL*Frank
    C. Gill

Director

August 2, 2006/s/  MERRILL
    A. MCPEAK*Merrill
    A. McPeak

Director

August 2, 2006/s/  ROBIN
    L.
    WASHINGTON*Robin
    L. Washington

Director

August 2, 2006/s/  CYRIL
    J.
    YANSOUNI*Cyril
    J. Yansouni

Director

August 2, 2006*By:

/s/  JAMES
    F. DALTONJames
    F. Dalton
        as
    attorney-in-fact



August 2, 2006  95




---



##### Table of Contents



Tektronix,
    Inc. and Subsidiaries
  Schedule II 
    Valuation and Qualifying Accounts
 For
    the years ended May 29, 2004, May 28, 2005 and
    May 27, 2006
  Charged to


ChargedBeginning


Costs and


to Other





EndingDescription

Balance


Expenses


Accounts


Deductions


Balance(Dollars in thousands)2004:Allowance for doubtful accounts

$
3,756


$
671


$



$
(1,414
)

$
3,013Deferred tax assets valuation
    allowance


24,959











(1,776
)

$
23,1832005:Allowance for doubtful accounts

$
3,013


$
559


$



$
(166
)

$
3,406Deferred tax assets valuation
    allowance


23,183











(16,664
)


6,5192006:Allowance for doubtful accounts

$
3,406


$
(126
)

$



$
(201
)

$
3,079Deferred tax assets valuation
    allowance


6,519











(4,838
)


1,681  96




---



##### Table of Contents



EXHIBIT INDEX
 Exhibit
No.
    

Exhibit
Description(3)
    
    (i)
    
    Restated Articles of Incorporation
of the Company, as amended. Incorporated by reference to
Exhibit 3(i) of Form 10-K filed August 12, 2004, SEC File No. 1-04837.(ii)
    
    Bylaws of the Company, as amended. Incorporated by reference
to Exhibit 3(ii) of Form 8-K filed May 9, 2005, SEC File No. 1-04837.(4)
    
    (i)
    
    Pursuant to Item 601(b)(4)(iii) of Regulation S-K, the registrant agrees to
furnish to the Commission upon request copies of agreements relating to other
indebtedness.(ii)
    
    Rights Agreement dated as of June 21, 2000, between Tektronix,
Inc. and ChaseMellon Shareholder Services, L.L.C. Incorporated by reference
to Exhibit (4) of Form 8-K filed June 28, 2000, SEC File No. 1-04837.(10)
    
    +(i)
    
    Stock Incentive Plan, as amended. Incorporated by reference to Exhibit 10(ii) of Form 10-Q filed April 12, 1993,
SEC File No. 1-04837.+(ii)
    
    Restated Annual Performance Incentive Plan, as amended. Incorporated by reference to Exhibit 10(iii) of Form 10-Q
filed October 14, 2003, SEC File No. 1-04837.+(ii)(A)
    
    Annual Performance Incentive Plan  Additional Information.+(iii)
    
    Change of Control Agreements. Form of agreement is incorporated by reference to Exhibit 10(viii) of Form 10-K
dated August 18, 1993, SEC File No. 1-4837. Current list of covered executive officers is incorporated by
reference to Exhibit 10.1 of Form 10-Q filed January 4, 2006. SEC File No. 1-04837.+(iv)
    
    Retirement Equalization Plan, Restatement. Incorporated by reference to Exhibit 10(v) of Form 10-K filed August
22, 1996, SEC File No. 1-04837.+(v)
    
    Indemnity Agreement entered into between the Company and certain named officers and directors. Incorporated by
reference to Exhibit 10(ix) of Form 10-K filed August 20, 1993, SEC File No. 1-04837.+(vi)
    
    Executive Severance Agreement dated May 17, 2001 entered into between the Company and its Chief Executive Officer,
Richard H. Wills. Incorporated by reference to Exhibit 10(vii) of Form 10-K filed August 2, 2001, SEC File No.
1-04837.+(vii)
    
    Form of Executive Severance Agreement entered into between the Company and each of its executive officers (other
than the Chief Executive Officer). Incorporated by reference to Exhibit 10(vii) of Form 10-K filed August 12,
2004, SEC File No. 1-04837.+(viii)
    
    Tektronix, Inc. 2001 Non-Employee Directors Compensation Plan, 2005 Restatement, as amended March 15, 2006.
Incorporated by reference to Exhibit 10.1 of Form 8-K filed March 20, 2006, SEC File No. 1-04837.+(ix)
    
    1998 Stock Option Plan, as amended. Incorporated by reference to Exhibit 10(i) of Form 10-Q filed October 8,
1999, SEC File No. 1-04837.+(x)
    
    Tektronix, Inc. Deferred Compensation Plan, 2005 Restatement, effective January 1, 2005.+(xi)
    
    Tektronix, Inc. Stock Deferral Plan, 2005 Restatement, effective January 1, 2005.+(xii)
    
    Individual Cash Incentive Arrangements. Incorporated by reference to Exhibit 10(xii) of Form 10-K filed August 5,
2005, SEC File No. 1-04837.+(xiii)
    
    2001 Stock Option Plan. Incorporated by reference to Exhibit 10(xiv) of Form 10-K filed August 14, 2003, SEC File
No. 1-04837.+(xiv)
    
    2002 Stock Incentive Plan, as amended. Incorporated by reference to Exhibit 10(xiv) of Form 10-K filed August 5,
2005, SEC File No. 1-04827.+(xv)
    
    Agreement and plan of merger dated as of June 29, 2004, among Tektronix, Inc., Inet Technologies, Inc., Impala
Merger Corp. and Impala Acquisition Co. LLC. Incorporated by reference to Exhibit (2) of Form 8-K filed June 30,
2004, SEC File No. 1-04837.+(xvi)
    
    Form of Non-Statutory Stock Option Agreement for Executive Officers under the Tektronix 2005 Stock Incentive Plan.
Incorporated by reference to Exhibit 10.2 of Form 8-K filed January 23, 2006, SEC File No. 1-04837.+(xvii)
    
    Form of Restricted Stock Agreement for Executive Officers under the Tektronix 2005 Stock Incentive Plan.
Incorporated by reference to Exhibit 10.1 of Form 8-K filed January 23, 2006, SEC File No. 1-04837.




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##### Table of Contents



Exhibit No.
    

Exhibit
Description+(xviii)
    
    2005 Stock Incentive Plan.
Incorporated by reference to appendix B to the Companys Proxy Statement dated August 18, 2005 for the 2005 Annual Meeting of Shareholders.(14)
    
    (i)
    
    Code of Ethics for Financial Managers. Incorporated by reference to Exhibit
14(i) of Form 10-K filed August 12, 2004, SEC File No. 1-04837.(ii)
    
    Business Practices Guidelines, 2007 Restatement, effective as of May 28, 2006.(21)
    
    
    
    Subsidiaries of the registrant.(23)
    
    
    
    Consent of Independent Registered Public Accounting Firm.(24)
    
    
    
    Powers of Attorney.(31.1)
    
    
    
    302 Certification, Chief Executive Officer.(31.2)
    
    
    
    302 Certification, Chief Financial Officer.(32.1)
    
    
    
    906 Certification, Chief Executive Officer.(32.2)
    
    
    
    906 Certification, Chief Financial Officer.
 
 +
    
    Compensatory Plan or Arrangement