**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**






**FORM
      10-Q**




(Mark
      One)


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




For
      the
      quarterly period ended February 29, 2008




**OR**


o **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. 0-11003




**WEGENER
      CORPORATION**





(Exact
      name of registrant as specified in its charter)


**Delaware**
              
              **81–0371341**(State
                  or other jurisdiction
              
              (I.R.S.
                  Employerof
                  incorporation or organization)
              
              Identification
                  No.)
  **11350
                  Technology Circle, Duluth, Georgia**
              
              **30097-1502**(Address
                  of principal executive offices)
              
              (Zip
                  Code)




**Registrant's
      telephone number, including area code:** (770)
      623-0096




**Registrant’s
      web site: HTTP://WWW.WEGENER.COM**




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
      o**





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 o **** **** Accelerated
      filer o **** **** Non-accelerated
      filer o **** **** Smaller
      reporting company x ****




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Act).  **Yes
      x** **No
      o**




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


Common
                  Stock, $.01 par value
              12,647,051
                  SharesClass
              Outstanding
                  at March 28, 2008







**WEGENER
          CORPORATION**
 **Form
          10-Q For the Quarter Ended February 29, 2008**
 
 **INDEX**
 **PART
                    I. Financial Information**Item
                    1.
                Financial
                    StatementsIntroduction
                3Consolidated
                    Statements of Operations(Unaudited)
                    - Three and Six Months EndedFebruary
                    29, 2008 and March 2, 2007
                4Consolidated
                    Balance Sheets - February 29, 2008(Unaudited)
                    and August 31, 2007
                5Consolidated
                    Statements of Shareholders' Equity(Unaudited)
                    - Six Months Ended February 29,2008
                    and March 2, 2007
                6Consolidated
                    Statements of Cash Flows(Unaudited)
                    - Six Months Ended February 29,2008
                    and March 2, 2007
                7Notes
                    to Consolidated FinancialStatements
                    (Unaudited)
                8Item
                    2.
                Management's
                    Discussion and Analysis of FinancialCondition
                    and Results of Operations
                16Item
                    3.
                Quantitative
                    and Qualitative Disclosures About Market Risk
                21Item
                    4.
                Controls
                    and Procedures
                21Item
                    4T.
                Controls
                    and Procedures
                21**PART
                    II. Other Information**Item
                    1A.
                Risk
                    Factors
                22Item
                    4.
                Submission
                    of Matters to a Vote of Security Holders
                22Item
                    6.
                Exhibits
                23Signatures
                24




2




**PART
      I. FINANCIAL INFORMATION**





**ITEM
      1.**  **FINANCIAL
      STATEMENTS**




**INTRODUCTION
      - CONSOLIDATED FINANCIAL STATEMENTS**








The
      consolidated financial statements of Wegener ’ Corporation (the “Company”, “we”, “our” or “us”) included herein have been
      prepared pursuant to the rules and regulations of the Securities and Exchange
      Commission. The consolidated balance sheet as of February 29, 2008; the
      consolidated statements of shareholders' equity as of February 29, 2008, and
      March 2, 2007; the consolidated statements of operations for the three and
      six
      months ended February 29, 2008, and March 2, 2007; and the consolidated
      statements of cash flows for the six months ended February 29, 2008, and March
      2, 2007, have been prepared without audit. The consolidated balance sheet as
      of
      August 31, 2007 has been audited by independent registered public accountants.
      Certain information and footnote disclosures normally included in financial
      statements prepared in accordance with generally accepted accounting principles
      have been condensed or omitted pursuant to such rules and regulations, although
      the Company believes that the disclosures herein are adequate to make the
      information presented not misleading. It is suggested that these consolidated
      financial statements be read in conjunction with the financial statements and
      the notes thereto included in the Company's Annual Report on Form 10-K for
      the
      fiscal year ended August 31, 2007, File No. 0-11003.





In
      the
      opinion of the Company, the statements for the unaudited interim periods
      presented include all adjustments, which were of a normal recurring nature,
      necessary to present a fair statement of the results of such interim periods.
      The results of operations for the interim periods presented are not necessarily
      indicative of the results of operations for the entire year.




3





**WEGENER
      CORPORATION AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF OPERATIONS**


(Unaudited)





Three
                    months ended
                
                Six
                    months ended**February
                      29,**
                
                March
                    2,
                
                **February
                    29,**
                
                March
                    2,**2008**
                
                2007
                
                **2008**
                
                2007Revenues,
                    net
                
                **$**
                **6,666,420**
                
                $
                4,770,665
                
                **$**
                **11,692,349**
                
                $
                9,554,142Operating
                    costs and expensesCost
                    of products sold
                
                
                **4,125,365**
                
                
                2,821,550
                
                
                **7,088,104**
                
                
                6,427,052Selling,
                    general and administrative
                
                
                **1,405,225**
                
                
                1,338,073
                
                
                **2,668,742**
                
                
                2,636,592Research
                    and development
                
                
                **769,546**
                
                
                773,205
                
                
                **1,578,583**
                
                
                1,594,167Operating
                    costs and expenses
                
                
                **6,300,136**
                
                
                4,932,828
                
                
                **11,335,429**
                
                
                10,657,811Operating
                    income (loss)
                
                
                **366,284**
                
                
                (162,163
                )
                
                **356,920**
                
                
                (1,103,669
                )Interest
                    expense
                
                
                **(30,136**
                **)**
                
                (24,761
                )
                
                **(71,842**
                **)**
                
                (50,525
                )Interest
                    income
                
                
                **177**
                
                
                3,650
                
                
                **740**
                
                
                8,970Net
                    earnings (loss )
                
                **$**
                **336,325**
                
                $
                (183,274
                )
                **$**
                **285,818**
                
                $
                (1,145,224
                )Net
                    earnings (loss) per share:Basic
                
                **$**
                **0.03**
                
                $
                (0.01
                )
                **$**
                **0.02**
                
                $
                (0.09
                )Diluted
                
                **$**
                **0.03**
                
                $
                (0.01
                )
                **$**
                **0.02**
                
                $
                (0.09
                )Shares
                    used in per share calculationBasic
                
                
                **12,647,051**
                
                
                12,582,875
                
                
                **12,647,051**
                
                
                12,580,963Diluted
                
                
                **12,651,835**
                
                
                12,582,875
                
                
                **12,658,476**
                
                
                12,580,963





See
      accompanying notes to consolidated financial statements.




4


**WEGENER
      CORPORATION AND SUBSIDIARIES**


**CONSOLIDATED
      BALANCE SHEETS**


**February
                  29,**
                **2008**
                **(Unaudited)**
              
              August
                  31,
                2007**Assets**Current
                assetsCash
                  and cash equivalents
              
              **$**
              **4,855**
              
              $
              6,728Accounts
                  receivable, net
              
              
              **4,201,693**
              
              
              5,172,348Inventories,
                  net
              
              
              **4,083,313**
              
              
              3,380,410Other
              
              
              **234,095**
              
              
              194,847Total
                  current assets
              
              
              **8,523,956**
              
              
              8,754,333Property
                  and equipment, net
              
              
              **1,778,015**
              
              
              1,777,677Capitalized
                  software costs, net
              
              
              **1,166,300**
              
              
              1,241,577Other
                  assets
              
              
              **577,298**
              
              
              684,238Land
                  held for sale
              
              
              **353,712**
              
              
              353,712Total
                  assets
              
              **$**
              **12,399,281**
              
              $
              12,811,537**Liabilities
                  and Shareholders’ Equity**Current
                  liabilitiesBank
                  line of credit
              
              **$**
              **1,728,093**
              
              $
              2,015,704Accounts
                  payable
              
              
              **1,837,131**
              
              
              1,145,327Accrued
                  expenses
              
              
              **2,331,420**
              
              
              2,609,222Deferred
                  revenue
              
              
              **699,035**
              
              
              774,183Customer
                  deposits
              
              
              **1,113,676**
              
              
              1,870,673Total
                  current liabilities
              
              
              **7,709,355**
              
              
              8,415,109Commitments
                  and contingencies
              
              
              **-**
              
              
              -Shareholders’
                  equityCommon
                      stock, $.01 par value; 20,000,000 shares authorized; 12,647,051 and
                      12,647,051 shares issued and outstanding,
                      respectively
              
              
              **126,471**
              
              
              126,471Additional
                  paid-in capital
              
              
              **20,006,702**
              
              
              19,999,022Deficit
              
              
              **(15,443,247**
              **)**
              
              (15,729,065
              )Total
                  shareholders’ equity
              
              
              **4,689,926**
              
              
              4,396,428Total
                  liabilities and shareholders’ equity
              
              **$**
              **12,399,281**
              
              $
              12,811,537





See
      accompanying notes to consolidated financial statements.




5


**WEGENER
      CORPORATION AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF SHAREHOLDERS’ EQUITY**


(Unaudited)





AdditionalCommon
                Stock
            
            Paid-inShares
            
            Amount
            
            Capital
            
            DeficitBalance
                at September 1, 2006
            
            
            12,579,051
            
            $
            125,791
            
            $
            19,924,915
            
            $
            (14,976,303
            )Share-based
                compensation expense
            
            
            -
            
            
            -
            
            
            17,667
            
            
            -Common
                stock issued throughstock
                options
            
            
            68,000
            
            
            680
            
            
            56,440
            
            
            -Net
                loss for the six months
            
            
            -
            
            
            -
            
            
            -
            
            
            (1,145,224
            )BALANCE
                at March 2, 2007
            
            
            12,647,051
            
            $
            126,471
            
            $
            19,999,022
            
            $
            (16,121,527
            )Balance
                at August 31, 2007
            
            
            12,647,051
            
            $
            126,471
            
            $
            19,999,022
            
            $
            (15,729,065
            )Share-based
                compensation expense
            
            
            -
            
            
            -
            
            
            7,680
            
            
            -Net
                earnings for the six months
            
            
            -
            
            
            -
            
            
            -
            
            
            285,818**BALANCE
                at February 29, 2008**
            
            
            **12,647,051**
            
            **$**
            **126,471**
            
            **$**
            **20,006,702**
            
            **$**
            **(15,443,247**
            **)**





See
      accompanying notes to consolidated financial statements.





6




**WEGENER
      CORPORATION AND SUBSIDIARIES**


**CONSOLIDATED
      STATEMENTS OF CASH FLOWS**


(Unaudited)




Six
                months ended**February 29,**
              **2008**
            
            March 2,
              2007**Cash
                flows from operating activities**Net
                earnings (loss)
            
            **$**
            **285,818**
            
            $
            (1,145,224
            )Adjustments
                to reconcile net earnings (loss) to cash provided (used) by operating
                activitiesDepreciation
                and amortization
            
            
            **940,551**
            
            
            1,109,465Share-based
                compensation expense
            
            
            **7,680**
            
            
            17,667Provision
                for bad debts
            
            
            **35,000**
            
            
            (50,000
            )Provision
                for inventory reserves
            
            
            **-**
            
            
            75,000Provision
                for warranty reserves
            
            
            **-**
            
            
            100,000Changes
                in assets and liabilitiesAccounts
                receivable
            
            
            **935,655**
            
            
            (801,185
            )Inventories
            
            
            **(702,903**
            **)**
            
            (275,868
            )Other
                assets
            
            
            **(39,249**
            **)**
            
            42,976Accounts
                payable
            
            
            **691,804**
            
            
            276,173Accrued
                expenses
            
            
            **(277,802**
            **)**
            
            265,826Deferred
                revenue
            
            
            **(75,148**
            **)**
            
            (240,084
            )Customer
                deposits
            
            
            **(756,997**
            **)**
            
            (106,045
            )Net
                cash provided (used) by operating activities
            
            
            **1,044,409**
            
            
            (731,299
            )**Cash
                flows from investment activities**Property
                and equipment expenditures
            
            
            **(202,073**
            **)**
            
            (130,570
            )Capitalized
                software additions
            
            
            **(544,645**
            **)**
            
            (774,994
            )License
                agreement, patent, and trademark expenditures
            
            
            **(11,953**
            **)**
            
            (87,487
            )Net
                cash used for investing activities
            
            
            **(758,671**
            **)**
            
            (993,051
            )**Cash
                flows from financing activities**Net
                change in revolving line of credit
            
            
            **(287,611**
            **)**
            
            803,757Proceeds
                from stock options exercised
            
            
            **-**
            
            
            57,120Net
                cash (used) provided by financing activities
            
            
            **(287,611**
            **)**
            
            860,877Decrease
                in cash and cash equivalents
            
            
            **(1,873**
            **)**
            
            (863,473
            )Cash
                and cash equivalents, beginning of period
            
            
            **6,728**
            
            
            958,784Cash
                and cash equivalents, end of period
            
            **$**
            **4,855**
            
            $
            95,311Supplemental
                disclosure of cash flow information:Cash
                paid for Interest
            
            **$**
            **71,842**
            
            $
            50,525





See
      accompanying notes to consolidated financial statements.





7




**WEGENER
      CORPORATION AND SUBSIDIARIES**





**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**Note
      1 Significant Accounting Policies**


The
      significant accounting policies followed by the Company are set forth in Note
      1
      to the Company's audited consolidated financial statements included in the
      annual report on Form 10-K for the year ended August 31, 2007.





**Revenue
      Recognition**


Our
      revenue recognition policies are in compliance with Staff Accounting Bulletin
      (SAB) No. 104, “Revenue Recognition”, SAB No. 101, “Revenue Recognition in
      Financial Statements” and EITF Issue No. 00-21, "Revenue Arrangements with
      Multiple Deliverables." Revenue is recognized when persuasive evidence of an
      agreement with the customer exists, products are shipped or title passes
      pursuant to the terms of the agreement with the customer, the amount due from
      the customer is fixed or determinable, collectibility is reasonably assured,
      and
      when there are no significant future performance obligations. Service revenues
      are recognized at the time of performance. Extended service maintenance contract
      revenues are recognized ratably over the maintenance contract term, which is
      typically one year. The unrecognized revenue portion of maintenance contracts
      invoiced is recorded as deferred revenue. At February 29, 2008, deferred
      extended service maintenance revenues were $517,000 and deferred revenues
      related to the fair value of future performance obligations were $182,000 and
      are expected to be recognized as revenue in varying amounts throughout fiscal
      2008 and into fiscal 2009.





We
      have
      recognized revenue in certain circumstances before delivery has occurred
      (commonly referred to as “bill and hold” transactions). In such circumstances,
      among other things, risk of ownership has passed to the buyer, the buyer has
      made a written fixed commitment to purchase the finished goods, the buyer has
      requested the finished goods be held for future delivery as scheduled and
      designated by them, and no additional performance obligations exist by the
      Company. For these transactions, the finished goods are segregated from
      inventory and normal billing and credit terms are granted. For the six months
      ended February 29, 2008, no revenues were recorded as bill and hold
      transactions.





These
      policies require management, at the time of the transaction, to assess whether
      the amounts due are fixed or determinable, collection is reasonably assured,
      and
      if future performance obligations exist. These assessments are based on the
      terms of the agreement with the customer, past history and credit worthiness
      of
      the customer. If management determines that collection is not reasonably assured
      or future performance obligations exist, revenue recognition is deferred until
      these conditions are satisfied.





Our
      principal sources of revenues are from the sales of various satellite
      communications equipment. Embedded in our products is internally developed
      software of varying applications. Historically, we have not sold or marketed
      our
      software separately or otherwise licensed our software apart from the related
      communications equipment. Should we begin to market or sell software whereby
      it
      is more than an incidental component of the hardware, then we will recognize
      software license revenue in accordance with Statement of Position (SOP) No.
      97-2, “Software Revenue Recognition,” as amended by SOP No. 98-9, “Software
      Revenue Recognition, with Respect to Certain Transactions.” Significant
      judgment may be required in determining whether a product is a software or
      hardware product.





In
      accordance with EITF Issue 00-10, “Accounting for Shipping and Handling Fees and
      Costs,” we include all shipping and handling billings to customers in revenues,
      and freight costs incurred for product shipments are included in cost of
      products sold.





**Earnings
      Per Share**


Basic
      and
      diluted net earnings per share were computed in accordance with Statement of
      Financial Accounting Standards No. 128, “Earnings Per Share.” Basic net earnings
      per share is computed by dividing net earnings available to common shareholders
      (numerator) by the weighted average number of common shares outstanding
      (denominator) during the period and excludes the dilutive effect of stock
      options. Diluted net earnings per share gives effect to all dilutive potential
      common shares outstanding during a period. In computing diluted net earnings
      per
      share, the average stock price for the period is used in determining the number
      of shares assumed to be reacquired under the treasury stock method from the
      exercise of stock options.





8


**Share-Based
      Compensation**


We
      account for share-based payments to employees, including grants of employee
      stock options, in
      accordance with Statement
      of Financial Accounting Standards (SFAS) No. 123 (Revised 2004), “Share-Based
      Payment” (SFAS 123R). SFAS 123R requires that these awards be recognized as
      compensation expense in the consolidated financial statements based on their
      fair values. That expense will be recognized over the period during which an
      employee is required to provide services in exchange for the award, known as
      the
      requisite service period (usually the vesting period). For the three and six
      months ended February 29, 2008, share-based compensation expense included in
      selling, general and administrative expenses amounted to approximately $8,000
      and $8,000, respectively, compared to $16,000 and $17,700, respectively, for
      the
      same periods ended March 2, 2007. The weighted average fair value of options
      granted during the six months ended February 29, 2008 was $.51 with an aggregate
      total value of $8,000. The weighted average fair value of options granted during
      the six months ended March 2, 2007 was $.90 with an aggregate total value of
      $16,000. As of February 29, 2008, no compensation costs related to non-vested
      stock options remain to be recognized.





The
      fair
      value of each option was estimated on the date of grant using the Black-Scholes
      option-pricing model with the following weighted average
      assumptions:





Three
                months ended
            
            Six
                months ended**February
                29,**
            
            March
                2,
            
            **February
                29,**
            
            March
                2,**2008**
            
            2007
            
            **2008**
            
            2007Risk
                free interest rate
            
            
            **3.45**%****
            
            
            4.70%
            
            
            **3.45**%****
            
            
            4.70%Expected
                term
            
            
            **5.0
                years**
            
            
            10.0
                years
            
            
            **5.0
                years**
            
            
            10.0
                yearsVolatility
            
            
            **70**%****
            
            
            90%
            
            
            **70**%****
            
            
            90%Expected
                annual dividends
            
            
            **None**
            
            
            None
            
            
            **None**
            
            
            NoneForfeiture
                rate
            
            
            -
            
            
            -
            
            
            -
            
            
            -





The
      following table summarizes stock option transactions for the six months ended
      February 29, 2008:





**Range
                of**
            
            **Weighted****Number**
            
            **Exercise**
            
            **Average****of
                Shares**
            
            **Prices**
            
            **Exercise
                Price**Outstanding
                atAugust
                31, 2007
            
            
            971,531
            
            $
            .63 –
                2.72
            
            $
            1.55Granted
            
            
            15,000
            
            
            0.85
            
            
            0.85Forfeited
                or cancelled
            
            
            (53,000
            )
            
            1.41
                – 2.21
            
            
            1.43**Outstanding
                at****February
                29, 2008**
            
            
            **933,531**
            
            **$**
            **.63**–**2.72**
            
            **$**
            **1.55****Available
                for issue at****February
                29, 2008**
            
            
            **-**
            
            
            **-**
            
            
            **-****Options
                exercisable at****February
                29, 2008**
            
            
            **933,531**
            
            **$**
            **.63**–**2.72**
            
            **$**
            **1.55**August
                31, 2007
            
            
            971,531
            
            $
            .63
                – 2.72
            
            $
            1.56





The
      1998
      Incentive Plan expired and terminated effective December 31, 2007. The key
      terms
      of the stock options granted under our stock plans are included in the Company's
      Annual Report on Form 10-K for the fiscal year ended August 31,
      2007.





**Bank
      Overdrafts**


Bank
      overdrafts consist of outstanding checks that have not cleared our bank.
      Overdrafts are offset against cash balances to the extent that cash balances
      are
      available in the account on which the checks are issued. Remaining balances
      of
      overdrafts are included in our accounts payable balances. At February 29, 2008,
      outstanding checks in the amounts of $265,000 were included in accounts payable
      balances.





**Use
      of Estimates**


The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires management to make estimates and assumptions
      that
      affect the reported amounts of assets and liabilities, the disclosure of
      contingent assets and liabilities at the date of the financial statements and
      the reported amounts of revenues and expenses during the reporting period.
      Examples include valuation allowances for deferred tax assets, provisions for
      bad debts, inventory obsolescence and warranties. Actual results could vary
      from
      these estimates.




9





**Fiscal
      Year**


We
      use a
      fifty-two, fifty-three week year. The fiscal year ends on the Friday closest
      to
      August 31. Fiscal years 2008 and 2007 contain fifty-two weeks.





**Note
      2 Accounts Receivable**


Accounts
      receivable are summarized as follows:




**February
                29,**
              **2008**
            
            August
                31,
              2007**(Unaudited)**Accounts
                receivable – trade
            
            **$**
            **4,411,754**
            
            $
            5,345,196Other
                receivables
            
            
            **75,864**
            
            
            78,468**4,487,618**
            
            
            5,423,664Less
                allowance for doubtful accounts
            
            
            **(285,925**
            **)**
            
            (251,316
            )Accounts
                receivable, net
            
            **$**
            **4,201,693**
            
            $
            5,172,348





**Note
      3 Inventories**


Inventories
      are summarized as follows:


**February
                  29,**
                **2008**
              
              August
                  31,
                2007**(Unaudited)**Raw
                  material
              
              **$**
              **3,753,020**
              
              $
              3,482,396Work-in-process
              
              
              **1,002,429**
              
              
              962,286Finished
                  goods
              
              
              **3,398,169**
              
              
              3,028,041**8,153,618**
              
              
              7,472,723Less
                  inventory reserves
              
              
              **(4,070,305**
              **)**
              
              (4,092,313
              )Inventories,
                  net
              
              **$**
              **4,083,313**
              
              $
              3,380,410




Our
      inventory reserve of approximately $4,070,000 at February 29, 2008 is to provide
      for items that are potentially slow-moving, excess or obsolete. During the
      first
      six months of fiscal 2008, inventory reserves were reduced by writeoffs of
      approximately $22,000. Changes in market conditions, lower than expected
      customer demand and rapidly changing technology could result in additional
      obsolete and slow-moving inventory that is unsaleable or saleable at reduced
      prices. No estimate can be made of a range of amounts of loss from obsolescence
      that are reasonably possible should our sales efforts not be
      successful.





**Note
      4**  **Land
      Held for Sale**


During
      the third quarter of fiscal 2007, the Company’s Board of Directors authorized
      and approved the listing for sale of the 4.4 acres of undeveloped land located
      adjacent to the Company’s headquarters facility in Duluth (Johns Creek),
      Georgia. The Company evaluated the criteria of SFAS No. 144 (as amended),
“Accounting for the Impairment or Disposal of Long-Lived Assets” (SFAS No. 144)
      and concluded that these assets qualified as assets held for sale.  In
      accordance with SFAS No. 144, the land was reclassified to land held for sale
      at
      its historic carrying value of $354,000 (lower of carrying amount or fair value
      less costs to sell) in the consolidated balance sheet as of February 29, 2008.
      The land was acquired in August 1989 and no impairment charges were recorded
      related to the reclassification.





10





**Note
      5 Other Assets**


Other
      assets consisted of the following:





**February
                29, 2008 (unaudited)****Cost**
            
            **Accumulated**
              **Amortization**
            
            **Net**License
                agreements
            
            **$**
            **933,800**
            
            **$**
            **(909,448**
            **)**
            **$**
            **24,352**Patents
                and patent applications
            
            
            **491,420**
            
            
            **(28,413**
            **)**
            
            **463,007**Trademarks
            
            
            **82,820**
            
            
            **(33,103**
            **)**
            
            **49,717**Loan
                facility fees
            
            
            **137,500**
            
            
            **(104,167**
            **)**
            
            **33,333**Other
            
            
            **6,889**
            
            
            **-**
            
            
            **6,889****$**
            **1,652,429**
            
            **$**
            **(1,075,131**
            **)**
            **$**
            **577,298**




August
                31, 2007Cost
            
            Accumulated
              Amortization
            
            NetLicense
                agreements
            
            $
            933,800
            
            $
            (862,198
            )
            $
            71,602Patents
                and patent applications
            
            
            472,551
            
            
            (14,006
            )
            
            458,545Trademarks
            
            
            89,736
            
            
            (25,867
            )
            
            63,869Loan
                facility fees
            
            
            137,500
            
            
            (54,167
            )
            
            83,333Other
            
            
            6,889
            
            
            -
            
            
            6,889$
            1,640,476
            
            $
            (956,238
            )
            $
            684,238




Amortization
      expense of other assets for the three and six months ended February 29, 2008,
      amounted to $47,000 and $119,000, respectively. Amortization expense of other
      assets for the three and six months ended March 2, 2007, amounted to $66,000
      and
      $123,000, respectively.





We
      conduct an ongoing review of our intellectual property rights and potential
      trademarks. At February 29, 2008, the cost of registered patents and trademarks
      amounted to $251,000 and $82,000, respectively. Additionally, as of February
      29,
      2008, we have cumulatively incurred $241,000 of legal fees related to the filing
      of applications for various patents and $1,000 related to the filing of
      trademarks. Upon issuance, these legal costs will be amortized on a
      straight-line basis over the lesser of the legal life or the estimated useful
      lives of the patent or trademark. If it becomes more likely than not that
      application will not be granted, we will write-off the deferred cost at that
      time. Patents and trademarks are amortized over their estimated useful life
      of
      four to ten years. License agreements are amortized over their estimated useful
      life of one to five years. Loan facility fees are amortized over twelve
      months.





**Note
      6**  **Accrued
      Expenses**


Accrued
      expenses consist of the following:





**February
                29,**
              **2008**
            
            August
                31,
              2007**(Unaudited)**Vacation
            
            **$**
            **603,080**
            
            $
            541,503Payroll
                and related expenses
            
            
            **394,180**
            
            
            382,690Royalties
            
            
            **154,776**
            
            
            76,989Warranty
            
            
            **520,052**
            
            
            534,052Taxes
                and insurance
            
            
            **264,082**
            
            
            61,935Commissions
            
            
            **83,699**
            
            
            104,876Professional
                fees
            
            
            **284,049**
            
            
            425,433Other
            
            
            **27,502**
            
            
            481,744**$**
            **2,331,420**
            
            $
            2,609,222




11




Accrued
      Warranty


We
      warrant our products for a 12 to 14 month period beginning at the date of
      shipment. The warranty provides for repair or replacement of defective products
      returned during the warranty period at no cost to the customer. We expense
      costs
      for routine warranty repairs as incurred. Additional provisions are made for
      non-routine warranty repairs based on estimated costs to repair at the point
      in
      time in which the warranty claim is identified. Accrued warranty liabilities
      amounted to $520,000 at February 29, 2008 and $534,000 at August 31, 2007.
      For
      the six months ended February 29, 2008, the accrual was reduced by $14,000
      for
      satisfied warranty claims.





**Note
      7**  **Deferred
      Revenue**


Deferred
      revenue consists of the unrecognized revenue portion of extended service
      maintenance contracts and fair value of revenue related to future performance
      obligations. Extended service maintenance contract revenues are recognized
      ratably over the maintenance contract term, which is typically one year. At
      February 29, 2008, deferred extended service maintenance revenues were $517,000
      and deferred revenues related to future performance obligations were $182,000
      and are expected to be recognized as revenue in varying amounts throughout
      fiscal 2008 and into fiscal 2009.




**Note
      8**  **Liquidity**


Revolving
      Line of Credit and Term Loan Facility





WCI’s
      bank loan facility provides a maximum available credit limit of $5,000,000
      subject to availability advance formulas. The loan facility matures on September
      30, 2008, or upon demand, and requires an annual facility fee of 2% of the
      maximum credit limit. The loan facility consists of a term loan and a revolving
      line of credit bearing interest at the bank’s prime rate (6.0% at February 29,
      2008). The bank retained the right to adjust the interest rate, subject to
      the
      financial performance of the Company.





The
      term
      loan facility provides for a maximum of $1,000,000 for advances of up to 80%
      of
      the cost of equipment acquisitions. Principal advances are payable monthly
      over
      60 months with a balloon payment due at maturity. The revolving line of credit
      is subject to availability advance formulas of 80% against eligible accounts
      receivable; 20% of eligible raw materials inventories; 20% of eligible
      work-in-process kit inventories; and 40% to 50% of eligible finished goods
      inventories and 50% of import letter of credit commitment balances. In addition,
      the facility provides for advances in excess of the availability formulas of
      up
      to $1,000,000 during the term of the facility. The loan is secured by a first
      lien on substantially all of WCI’s assets, including land and buildings, and is
      guaranteed by Wegener Corporation. At February 29, 2008, balances outstanding
      on
      the revolving line of credit amounted to $1,728,000. No borrowings were
      outstanding under the equipment term loan portions of the loan facility. The
      loan facility is also used to support import letters of credit issued to
      offshore manufacturers, which at February 29, 2008, amounted to
      $1,805,000.





At
      February 29, 2008, approximately $1,467,000, net of outstanding letters of
      credit, was available to borrow under the advance formulas. During the first
      six
      months of fiscal 2008, the line of credit average daily balance outstanding
      was
      $1,536,000 and the highest outstanding balance was $3,274,000. During the
      remainder of fiscal 2008 we expect the average daily balance to increase. We
      believe the loan facility will be sufficient to support operations over the
      next
      12 months.





At
      February 29, 2008, we had land and buildings with a cost basis of $4,457,000
      (including land held for sale of $354,000). Although land and buildings are
      subject to a lien under the loan facility, they are not currently used in the
      existing loan facility’s availability advance formulas and have no mortgage
      balances outstanding. While no assurances may be given, we believe these assets
      could be used to support additional overall borrowing capacities either with
      our
      existing bank or from other sources. During the third quarter of fiscal 2007,
      the Company’s Board of Directors authorized and approved the listing for sale of
      the 4.4 acres of undeveloped land located adjacent to the Company’s headquarters
      facility in Duluth (Johns Creek), Georgia (see note 4 to the consolidated
      financial statements). Proceeds from the sale of the land would be used to
      pay
      any balances outstanding on the revolving line of credit.





Under
      the
      loan facility, at the end of fiscal 2008 we are required to maintain a minimum
      tangible net worth. In addition, we are required to retain certain executive
      officers, maintain certain financial ratios, and are precluded from paying
      dividends.





**Note
      9 Income Taxes**


For
      the
      six months ended February 29, 2008, federal and state income tax expense
      provisions of $97,000 and $6,000, respectively, were fully offset by a decrease
      in the deferred tax asset valuation allowance which resulted in no income tax
      expense for the period. At February 29, 2008, net deferred tax assets of
      $5,916,000 were fully reserved by the valuation allowance.




12




At
      February 29, 2008, we had a federal net operating loss carryforward of
      approximately $9,439,000, which expires beginning fiscal 2020 through fiscal
      2028. Additionally, we had an alternative minimum tax credit of $138,000 and
      state income tax credits of $199,000 expiring in fiscal 2009, both of which
      were
      fully offset by the valuation allowance.




We
      adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income
      Taxes, an Interpretation of FASB Statement No. 109” (FIN 48) as of
      September 1, 2007, the first day of the first quarter of fiscal 2008. The
      adoption of FIN 48 had no impact on our financial position or results of
      operations. We are subject to U.S. federal income tax as well as income tax
      of
      numerous state jurisdictions. We are subject to U.S. federal tax examinations
      by
      tax authorities for fiscal years 2004 through 2007. Income tax examinations
      that
      we may be subject to from the various state taxing authorities vary by
      jurisdiction. Our policy under FIN 48 for penalties and interest is to include
      such amounts, if any, in income tax expense.





**Note
      10 Earnings Per Share**


The
      following tables represent required disclosure of the reconciliation of the
      numerators and denominators of the basic and diluted net earnings per share
      computations.


Three
                  months ended**February
                  29, 2008**
              
              March
                  2, 2007**Earnings**
                **(Numerator)**
              
              **Shares**
                **(Denominator)**
              
              **Per**
                **share**
                **amount**
              
              Earnings
                (Numerator)
              
              Shares
                (Denominator)
              
              Per
                share
                amountNet
                  earnings (loss)
              
              **$**
              **336,325**
              
              
              
              
              
              
              
              $
              (183,274
              )**Basic
                  earnings (loss) per share**:Net
                  earnings (loss) available to common shareholders
              
              **$**
              **336,325**
              
              
              **12,647,051**
              
              **$**
              **0.03**
              
              $
              (183,274
              )
              
              12,582,875
              
              $
              (0.01
              )Effect
                of dilutive potential common shares:Stock
                  options
              
              
              **-**
              
              
              **4,784**
              
              
              
              
              
              **-**
              
              
              **-****Diluted
                  earnings (loss) per share:**Net
                  earnings (loss) available to common shareholders
              
              **$**
              **336,325**
              
              
              **12,651,835**
              
              **$**
              **0.03**
              
              $
              (183,274
              )
              
              12,582,875
              
              $
              (0.01
              )
  Six
                    months ended**February
                    29, 2008**
                
                March
                    2, 2007**Earnings**
                  **(Numerator)**
                
                **Shares**
                  **(Denominator)**
                
                **Per**
                  **share**
                  **amount**
                
                Earnings
                  (Numerator)
                
                Shares
                  (Denominator)
                
                Per
                  share
                  amountNet
                    earnings (loss)
                
                **$**
                **285,818**
                
                
                
                
                
                
                
                $
                (1,145,224
                )**Basic
                    (loss) earnings per share:**Net
                    earnings (loss) available to common shareholders
                
                **$**
                **285,818**
                
                
                **12,647,051**
                
                **$**
                **0.02**
                
                $
                (1,145,224
                )
                
                12,580,963
                
                $
                (0.09
                )Effect
                    of dilutive potentialcommon
                    shares:Stock
                    options
                
                
                **-**
                
                
                **11,425**
                
                
                
                
                
                **-**
                
                
                **-****Diluted
                    earnings (loss) per share:**Net
                    earnings (loss) availableto
                    common shareholders
                
                **$**
                **285,818**
                
                
                **12,658,476**
                
                **$**
                **0.02**
                
                $
                (1,145,224
                )
                
                12,580,963
                
                $
                (0.09
                )
 13


Stock
      options excluded from the diluted net earnings (loss) per share calculation
      due
      to their anti-dilutive effect are as follows:





Three months ended
            
            Six months ended**February 29,**
              **2008**
            
            March 2,
              2007
            
            **February 29,**
              **2008**
            
            March 2,
              2007Common
                stock options:Number
                of shares
            
            
            **933,531**
            
            
            1,096,531
            
            
            **933,531**
            
            
            1,096,531Exercise
                price
            
            
            **$.63
                to $2.72**
            
            
            $.63
                to $2.72
            
            
            **$.63
                to $2.72**
            
            
            $.63
                to $2.72




**Note
      11 Segment Information and Significant Customers**




In
      accordance with Statement of Financial Accounting Standards No. 131, “Disclosure
      about Segments of an Enterprise and Related Information,” the Company operates
      within a single reportable segment, the manufacture and sale of satellite
      communications equipment.





In
      this
      single operating segment the Company has three sources of revenues as
      follows:





Three months ended
            
            Six months ended**February 29,**
              **2008**
            
            March 2,
              2007
            
            **February 29,**
              **2008**
            
            March 2,
              2007Product LineDirect
                Broadcast Satellite
            
            **$**
            **6,539,363**
            
            $
            4,580,032
            
            **$**
            **11,389,574**
            
            $
            9,212,253Analog
                and Custom Products
            
            
            **4,350**
            
            
            57,317
            
            
            **16,023**
            
            
            62,586Service
            
            
            **122,707**
            
            
            133,316
            
            
            **286,752**
            
            
            279,303**$**
            **6,666,420**
            
            $
            4,770,665
            
            **$**
            **11,692,349**
            
            $
            9,554,142




Concentrations
      of revenue are likely to occur in any one or more of our products in any of
      our
      reporting periods. Product revenues are subject to fluctuations from quarter
      to
      quarter and year to year as new products and technologies are introduced, new
      product features and enhancements are added and as customers upgrade or expand
      their network operations.


Concentration
        of products representing 10% or more of the respective period’s revenues are as
        follows:


Three months ended
              
              Six months ended**February 29,**
                **2008**
              
              March 2,
                2007
              
              **February 29,**
                **2008**
              
              March 2,
                2007ProductiPump
                  Media Servers
              
              
              **(a**
              **)**
              
              15.0
              %
              
              **(a**
              **)**
              
              23.1
              %Professional
                  and broadcast receivers
              
              
              **43.0**
              **%**
              
              22.1
              %
              
              **39.9**
              **%**
              
              24.3
              %Enterprise
                  media receivers
              
              
              **19.0**
              **%**
              
              (a
              )
              
              **14.3**
              **%**
              
              (a
              )Audio
                  broadcast receivers
              
              
              **(a**
              **)**
              
              10.1
              %
              
              **(a**
              **)**
              
              10.1
              %





(a)
      Revenues for the period were less than 10% of total revenues .




Concentration
      of products representing 10% or more of revenues in the prior three fiscal
      years
      are as follows:


Year
                  endedProducts
              
              **August
                  31,**
                **2007**
              
              September
                  1,
                2006
              
              September
                  2,
                2005iPump
                  Media Server
              
              
              **32.0**
              **%**
              
              (a
              )
              
              11.6
              %Professional
                  and broadcast receivers
              
              
              **20.6**
              **%**
              
              12.0
              %
              
              12.6
              %Audio
                  broadcast receivers
              
              
              **(a**
              **)**
              
              17.5
              %
              
              18.6
              %Nielsen
                  encoders
              
              
              **(a**
              **)**
              
              10.7
              %
              
              (a
              )Uplink
                  Equipment
              
              
              **(a**
              **)**
              
              (a
              )
              
              12.0
              %
 (a)
        Revenues for the period were less than 10% of total revenues.
 
 Fiscal
        2007 product mix featured new iPump ® Media
        Server products for broadcast radio customers adopting store and forward
        technologies in their network upgrades and a new customer for a digital signage
        network. The professional and broadcast receivers products benefited from
        a new
        cable network and expansion of high definition television distribution by
        cable
        headends. A new audio broadcast receiver for business music applications
        was
        developed during fiscal 2007 and began shipping in the first quarter of fiscal
        2008.


14




Revenues
      by geographic area are as follows :


Three months ended
              
              Six months ended**February 29,**
                **2008**
              
              March 2,
                2007
              
              **February 29,**
                **2008**
              
              March 2,
                2007Geographic
                  AreaUnited
                  States
              
              **$**
              **6,585,772**
              
              $
              3,924,608
              
              **$**
              **10,434,459**
              
              $
              8,355,243Latin
                  America
              
              
              **2,356**
              
              
              5,649
              
              
              **829,352**
              
              
              42,170Canada
              
              
              **32,695**
              
              
              79,328
              
              
              **300,215**
              
              
              104,332Europe
              
              
              **38,237**
              
              
              752,965
              
              
              **95,917**
              
              
              1,040,002Other
              
              
              **7,360**
              
              
              8,115
              
              
              **32,406**
              
              
              12,395**$**
              **6,666,420**
              
              $
              4,770,665
              
              **$**
              **11,692,349**
              
              $
              9,554,142


All
      of
      the Company’s long-lived assets are located in the United States. Customers
      representing 10% or more of the respective periods’ revenues are as
      follows:





Three months ended
            
            Six
                months ended**February 29,**
              **2008**
            
            March 2,
              2007
            
            **February 29,**
              **2008**
            
            March 2,
              2007Customer
                1
            
            
            **(a**
            **)**
            
            (a
            )
            
            **(a**
            **)**
            
            18.2
            %Customer
                2
            
            
            **(a**
            **)**
            
            10.2
            %
            
            **(a**
            **)**
            
            10.2
            %Customer
                3
            
            
            **10.6**
            **%**
            
            12.6
            %
            
            **14.4**
            **%**
            
            10.6
            %Customer
                4
            
            
            **31.9**
            **%**
            
            (a
            )
            
            **26.4**
            **%**
            
            10.8
            %Customer
                5
            
            
            **18.8**
            **%**
            
            (a
            )
            
            **13.8**
            **%**
            
            (a
            )Customer
                6
            
            
            **(a**
            **)**
            
            12.3
            %
            
            **(a**
            **)**
            
            (a
            )Customer
                7
            
            
            **(a**
            **)**
            
            13.7
            %
            
            **(a**
            **)**
            
            (a
            )




(a)
      Revenues for the period were less than 10% of total revenues.




**Note** **12
      Commitments**


We
      have
      three manufacturing and purchasing agreements for certain finished goods
      inventories. At February 29, 2008, outstanding purchase commitments under these
      agreements amounted to $3,625,000. Pursuant to the above agreements, at February
      29, 2008, we had outstanding letters of credit in the amount of $1,805,000.





**Note
      13 Guarantees and Indemnifications**


Letters
      of Credit


We
      provide standby letters of credit in the ordinary course of business to certain
      suppliers pursuant to manufacturing and purchasing agreements. At February
      29,
      2008, outstanding letters of credit amounted $1,805,000.





Financing
      Agreements


The
      Company guarantees the bank loan facility of WCI. The bank facility provides
      a
      maximum available credit limit of $5,000,000. At February 29, 2008, $1,728,000
      was outstanding on the loan facility.





Indemnification
      Obligations


We
      are
      obligated to indemnify our officers and the members of our Board of Directors
      pursuant to our bylaws and contractual indemnity agreements. We routinely sell
      products with a limited intellectual property indemnification included in the
      terms of sale or in certain contractual arrangements. The scope of these
      indemnities varies, but in some instances includes indemnification for damages
      and expenses (including reasonable attorneys’ fees). Certain requests for
      indemnification have been received by us pursuant to these arrangements (see
      Part II, Item 1. Legal Proceedings in our Quarterly report on Form 10-Q for
      the
      period ended November 30, 2007 for further discussion).




15




**WEGENER
      CORPORATION AND SUBSIDIARIES**





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




This
      information should be read in conjunction with the consolidated financial
      statements and the notes thereto included in Item 1 of this Quarterly Report,
      and the audited consolidated financial statements and notes thereto and
      Management’s Discussion and Analysis of Financial Condition and Results of
      Operations for the year ended August 31, 2007, contained in the Company’s 2007
      Annual Report on Form 10-K.




Certain
      statements contained in this filing are “forward-looking statements” within the
      meaning of the Private Securities Litigation Reform Act of 1995, and the Company
      intends that such forward-looking statements are subject to the safe harbors
      created thereby.  Forward-looking statements may be identified by words
      such as "believes," "expects," "projects," "plans," "anticipates," and similar
      expressions, and include, for example, statements relating to expectations
      regarding  future sales, income and cash flows. Forward-looking statements
      are based upon the Company’s current expectations and assumptions, which are
      subject to a number of risks and uncertainties including, but not limited
      to:  customer acceptance and effectiveness of recently introduced products;
      development of additional business for the Company’s digital video and audio
      transmission product lines; effectiveness of the sales organization; the
      successful development and introduction of new products in the future; delays
      in
      the conversion by private and broadcast networks to next generation digital
      broadcast equipment; acceptance by various networks of standards for digital
      broadcasting; the Company’s liquidity position and capital resources; general
      market conditions which may not improve during fiscal year 2008  and
      beyond; and success of the Company’s research and development efforts aimed at
      developing new products. Additional potential risks and uncertainties include,
      but are not limited to, economic conditions, customer plans and commitments,
      product demand, government regulation, rapid technological developments and
      changes, intellectual property disputes, performance issues with key suppliers
      and subcontractors, delays in product development and testing, availability
      of
      raw materials, new and existing well-capitalized competitors, and other
      uncertainties detailed from time to time in the Company’s periodic Securities
      and Exchange Commission filings, including the Company’s most recent Form 10-K.
      Such forward-looking statements are subject to risks, uncertainties and other
      factors and are subject to change at any time, which could cause actual results
      to differ materially from future results expressed or implied by such
      forward-looking statements. Forward-looking statements speak only as of the
      date
      the statement was made. The Company does not undertake any obligation to update
      any forward-looking statements.




**OVERVIEW**




We
      design
      and manufacture satellite communications equipment through Wegener
      Communications, Inc. (WCI), a wholly-owned subsidiary. WCI is a leading provider
      of digital solutions for video, audio and Internet Protocol (IP) data networks.
      Applications include IP
      data
      delivery, broadcast television, cable television, radio networks, business
      television, distance education, business music and financial information
      distribution.




During
      the second quarter of fiscal 2008, we booked $5.8 million in new orders. These
      orders included approximately $1.4 million from one of our larger private
      network customers for our  new
      Unity ® 552
      Enterprise Media Receiver (Unity ® 552).
      The Unity ® 552 has
      bandwidth-efficient MPEG-4/h.264 video coding for both standard definition
      and
      high definition video, digital and analog outputs, as well as advanced DVB-S2
      demodulation. With these new features, network operators can reduce their
      bandwidth utilization by approximately half, resulting in considerably lower
      operational costs. The order shipped in the second quarter of fiscal 2008,
      and
      is expected to be the first of a series of orders from the customer for a
      complete network upgrade to the Unity ® 552. We
      received orders totaling over $2.1 million for our SMD 515 IPTV(internet
      protocol television) set top box from Conklin-Intracom for use by multiple
      telco
      operators in North America to provide premium IPTV services including high
      definition programming, video on demand and integrated personal video recording.
      The SMD 515, supporting Conklin-Intracom’s fs/cdn ® solution,
      is currently being used in field trials by five telco operators in North
      America. Approximately $230,000 of this order shipped in the second quarter
      with
      the remainder scheduled to ship in the third quarter of fiscal 2008. An order
      for $1.2 million was received for our new iPump ® 562
      enterprise media server from Satellite Store Link (SSL) to support the expansion
      of SSL’s digital signage projects in Latin America and is scheduled to ship in
      our third and fourth quarters of fiscal 2008. The iPump ® 562
      media
      server supports bandwidth-saving features, such as MPEG-4/h.264 video
      compression and file-based workflows. These features can be used in combination
      to create customized, high quality HD (high definition) and SD (standard
      definition) video channels for digital signage applications.





During
      the first quarter of fiscal 2008, bookings, consisting primarily of add-on
      orders from existing customers, were approximately $3.6 million.




16




**Financial
      Position and Liquidity**





At
      February 29, 2008, we had line of credit borrowings outstanding of $1,728,000.
      Our $5,000,000 bank loan facility is subject to availability advance formulas
      based on eligible accounts receivable, import letter of credit commitment
      balances and inventories. The loan facility matures on September 30, 2008,
      or
      upon demand. At February 29, 2008, **** approximately
      $1,467,000, net of outstanding letters of credit in the amount of $1,805,000,
      remained available to borrow under the advance formulas.





During
      the first six months of fiscal 2008, our line of credit net outstanding
      borrowings decreased $288,000 from $2,016,000 at August 31, 2007 to $1,728,000
      at February 29, 2008. Operating activities provided $1,044,000 of cash and
      investing activities used $759,000 of cash, which consisted of capitalized
      software additions of $545,000, equipment additions of $202,000, and $12,000
      for
      legal fees related to the filing of applications for various patents and
      trademarks.





(See
      the
      Liquidity and Capital Resources section on page 20 for further
      discussion.)





**RESULTS
      OF OPERATIONS**


**THREE
      AND SIX MONTHS ENDED FEBRUARY 29, 2008 COMPARED TO THREE AND SIX MONTHS ENDED
      MARCH 2, 2007**




The
      following table sets forth, for the periods indicated, the components of our
      results of operations as a percentage of sales:




Three months ended
            
            Six months ended**February 29,**
              **2008**
            
            March 2,
              2007
            
            **February 29,**
              **2008**
            
            March 2,
              2007Revenues
            
            
            **100.0**
            **%**
            
            100.0
            %
            
            **100.0**
            **%**
            
            100.0
            %Cost
                of products sold
            
            
            **61.9**
            
            
            59.1
            
            
            **60.6**
            
            
            67.3Gross
                margin
            
            
            **38.1**
            
            
            40.9
            
            
            **39.4**
            
            
            32.7Selling,
                general, and administrative
            
            
            **21.1**
            
            
            28.0
            
            
            **22.8**
            
            
            27.6Research
                & development
            
            
            **11.5**
            
            
            16.2
            
            
            **13.5**
            
            
            16.7Operating
                income (loss)
            
            
            **5.5**
            
            
            (3.4
            )
            
            **3.1**
            
            
            (11.6
            )Interest
                expense
            
            
            **(
                .5**
            **)**
            
            (
                .5
            )
            
            **(
                .6**
            **)**
            
            (
                .5
            )Interest
                income
            
            
            **-**
            
            
            -
            
            
            **-**
            
            
            .1Earnings
                (loss) before income taxes
            
            
            **5.0**
            
            
            (24.1
            )
            
            **2.4**
            **)**
            
            (18.2
            )Income
                tax (expense) benefit
            
            
            **-**
            
            
            -
            
            
            **-**
            
            
            -Net
                earnings (loss)
            
            
            **5.0**
            **%**
            
            (24.1
            )%
            
            **2.4**
            **%**
            
            (18.2
            )%




The
      operating results for the three and six months ended February 29, 2008 were
      net
      earnings of $336,000 or $0.03 per share and $286,000 or $0.02 per share,
      respectively, compared to net losses of $(183,000) or $(0.01) per share and
      $(1,145,000) or $(0.09) per share, respectively, for the three and six months
      ended March 2, 2007.





**Revenues** -
      Revenues for the three months ended February 29, 2008 increased $1,895,000
      or
      39.7% to $6,666,000 from $4,771,000 for the same period in fiscal 2007. Revenues
      for the six months ended February 29, 2008 increased $2,138,000 or 22.4% to
      $11,692,000 from $9,554,000 for the same period in fiscal 2007.





Direct
      Broadcast Satellite (DBS) revenues (including service revenues) increased
      $1,949,000 or 41.3% in the second quarter of fiscal 2008 to $6,662,000 from
      $4,713,000 in the same period of fiscal 2007. For the six months ended February
      29, 2008, DBS revenues increased $2,184,000 or 23.0% to $11,676,000 from
      $9,492,000 for the six months ended March 2, 2007. The second quarter and first
      six months of fiscal 2008 benefited from completion of shipments of our
      Unity ® 4600 to
      the Big Ten Network for the new cable network being distributed by Fox Cable
      Networks and shipments of our SMD 515 IPTV set top box to Conklin-Intracom
      for
      use in providing premium IPTV services by telco operators in North America.
      Second quarter revenues included shipments of our Unity ® 552
      Enterprise Media Receiver to a private network customer for initial upgrades
      to
      its network. Shipments continued in the second quarter to MegaHertz for
      distribution of our products to the U.S. cable market and to business music
      provider Muzak LLC, of our new Encompass LE2, our next generation business
      music
      audio receiver. Revenues and order backlog are subject to the timing of
      significant orders from customers and new product introductions, and as a result
      revenue levels may fluctuate from quarter to quarter.




17




For
      the
      three months ended February 29, 2008, three customers accounted for 31.9%,
      18.8%
      and 10.6% of revenues, respectively. For the three months ended March 2, 2007,
      four customers accounted for 13.7%, 12.6%, 12.3% and 10.2% of revenues,
      respectively. For the six months ended February 29, 2008, the same three
      customers accounted for 26.4%, 13.8% and 14.4% of revenues, respectively. For
      the six months ended March 2, 2007, four customers accounted for 18.2%, 10.8%,
      10.6% and 10.2% of revenues, respectively. Sales to a relatively small number
      of
      major customers have typically comprised a majority of our revenues and that
      trend is expected to continue throughout fiscal 2008 and beyond.


Concentrations
        of revenue are likely to occur in any one or more of our products in any
        of our
        reporting periods. Product revenues are subject to fluctuations from quarter
        to
        quarter and year to year as new products and technologies are introduced,
        new
        product features and enhancements are added and as customers upgrade or expand
        their network operations (See note 11).
  Our
        backlog is comprised of undelivered, firm customer orders which are scheduled
        to
        ship within eighteen months. The backlog was approximately $9.8 million at
        February 29, 2008, compared to $10.2 million at August 31, 2007, and $8.4
        million at March 2, 2007. Four customers accounted for 31.5 %, 15.3 %, 13.3%
        and
        11.7 %, respectively, of the backlog at February 29, 2008. The total multi-year
        backlog at February 29, 2008, was approximately $15.7 million compared to
        $17.1
        million at August 31, 2007 and $16.3 million at March 2,
        2007.





**Gross
      Profit Margins** - The
      Company's gross profit margin percentages were 38.1% and 39.4 % for the three
      and six month periods ended February 29, 2008, compared to 40.9% and 32.7%
      for
      the three and six month periods ended March 2, 2007. Gross profit margin dollars
      increased $592,000 and $1,477,000, respectively, for the three and six months
      ended February 29, 2008, compared to the same periods in fiscal 2007. The
      decrease in margin percentages for the three months ended February 29, 2008
      was
      mainly due to a product mix with higher variable costs which were partially
      offset by lower unit fixed overhead costs resulting from increased revenues.
      The
      increase in margin dollars is mainly due to the increase in revenues for the
      period. The increase in margin percentages and dollars for the six months ended
      February 29, 2008 was mainly due to the increased revenues and lower unit fixed
      overhead costs resulting from the higher revenues which offset higher unit
      variable costs of the product mix. Profit margins in the three and six month
      periods of fiscal 2008 were favorably impacted by decreases in capitalized
      software amortization expense of $39,000 and $152,000, respectively. In
      addition, profit margins in the first six months of fiscal 2007 included
      inventory reserve charges of $75,000 and warranty provisions of $100,000
      compared to none in the first six months of fiscal 2008.





**Selling,
      General and Administrative** -
      Selling, general and administrative (SG&A) expenses increased $67,000, or
      5.0%, to $1,405,000 for the three months ended February 29, 2008, from
      $1,338,000 for the three months ended March 2, 2007. For the six months ended
      February 29, 2008, SG&A expenses increased $32,000, or 1.2%, to $2,669,000
      from $2,637,000 for the same period ended March 2, 2007. Corporate SG&A
      expenses in the second quarter of fiscal 2008 decreased $37,000, or 11.7%,
      to
      $280,000 from $317,000 for the same period in fiscal 2007. For the six months
      ended February 29, 2008, corporate SG&A expenses decreased $77,000, or
      13.6%, to $492,000 from $569,000 in the same period in fiscal 2007. The
      decreases for the periods were mainly due to lower professional fees and
      share-based compensation expense. WCI’s SG&A expenses increased $104,000, or
      10.2%, to $1,125,000 from $1,021,000 and $109,000, or 5.3%, to $2,177,000 from
      $2,067,000 for the three and six months ended February 29, 2008, compared to
      the
      same periods in fiscal 2007. The increase in WCI’s SG&A expenses for the
      three months ended February 29, 2008 was mainly due to increases in recruiting
      placement fees of $19,000, general overhead costs of $14,000 and professional
      fees of $24,000, which were offset by lower sales and marketing expenses of
      $25,000. SG&A expenses in the second quarter of fiscal 2007 benefited from
      the reversal of bad debt provisions of $50,000 related to collection of
      previously reserved accounts receivable, compared to a bad debt provision
      expense of $20,000 in the same period of fiscal 2008. The increase in WCI’s
      SG&A expenses for the six months ended February 29, 2008 was mainly due to
      increases in employee placement fees of $19,000, general overhead costs of
      $15,000 and professional fees of $17,000, which were offset by lower sales
      and
      marketing expenses of $19,000. WCI’s SG&A expenses in the first six months
      of fiscal 2007 benefited from the reversal of bad debt provisions of $50,000
      compared to a bad debt provision expense of $35,000 in the same period in fiscal
      2008.





For
      the
      three and six months ended February 29, 2008, share-based compensation expense
      included in SG&A expenses amounted to $8,000 and $8,000, respectively,
      compared to $16,000 and $17,700, respectively, for the same periods in fiscal
      2007. As a percentage of revenues, SG&A expenses were 21.1% and 22.8% for
      the three and six month periods ended February 29, 2008, compared to 28.0%
      and
      27.6% in the same periods in fiscal 2007.





**Research
      and Development** -
      Research and development (R&D) expenditures, including capitalized software
      development costs, were $1,121,000, or 16.8% of revenues, and $2,123,000, or
      18.2% of revenues, for the three and six month periods ended February
      29, 2008 ,
      compared to $1,172,000, or 24.6% of revenues, and $2,369,000, or 24.8% of
      revenues, for the same periods in fiscal 2007. The decreases in expenditures
      in
      the three and six months ended February 29, 2008, compared to the same periods
      of fiscal 2007, were mainly due to lower consulting costs, which were partially
      offset by increased salaries related to increases in compensation and headcount
      and increased recruiting costs related to new hires. Capitalized software
      development costs amounted to $352,000 and $545,000 for the second quarter
      and
      first six months of fiscal 2008 compared to $399,000 and $775,000 for the same
      periods in fiscal 2007. The decreases in capitalized software costs were related
      to completed projects. R&D expenses, excluding capitalized software
      expenditures, were $770,000, or 11.5% of revenues, and $1,579,000, or 13.5%
      of
      revenues, for the three and six months ended February 29, 2008, compared to
      $773,000, or 16.2% of revenues, and $1,594,000, or 16.7%, of revenues, in the
      same periods of fiscal 2007. The decreases in expenses in the three and six
      month periods of fiscal 2008 compared to the same periods in fiscal 2007 were
      mainly due to the decreases in expenditures discussed above partially offset
      by
      the reductions in capitalized software development costs.




18




**Interest
      Expense** -
      Interest expense increased $5,000 to $30,000 for the three months ended February
      29, 2008, from $25,000 for the three months ended March 2, 2007. For the six
      months ended February 29, 2008, interest expense increased $21,000 to $72,000
      from $50,000 for the same period ended March 2, 2007. The increases for the
      three and six month periods in fiscal 2008 were primarily due to an increase
      in
      average line-of-credit borrowings.





**Interest
      Income** **-** Interest
      income was less than $1,000 for the three and six month periods ended February
      29, 2008, compared to $4,000 and $9,000 for the same periods ended March 2,
      2007.





**Income
      Tax Expenses** **-** For the
      six months ended February 29, 2008, federal and state income tax expense
      provisions of $97,000 and $6,000, respectively, were fully offset by a decrease
      in the deferred tax asset valuation allowance which resulted in no income tax
      expense for the period. At February 29, 2008, net deferred tax assets of
      $5,916,000 were fully reserved by the valuation allowance. At February 29,
      2008,
      we had a federal net operating loss carryforward of approximately $9,439,000,
      which expires beginning fiscal 2020 through fiscal 2028. Additionally, we had
      an
      alternative minimum tax credit of $138,000 and state income tax credits of
      $199,000 expiring in fiscal 2009, both of which were fully offset by the
      valuation allowance.





**CRITICAL
      ACCOUNTING POLICIES**





Certain
      accounting policies are very important to the portrayal of our financial
      condition and results of operations and require management’s most subjective or
      difficult judgements. These policies are as follows:





**Revenue
      Recognition** –
      Our revenue recognition policies are in compliance with Staff Accounting
      Bulletin (SAB) No. 104, “Revenue Recognition”, SAB No. 101, “Revenue Recognition
      in Financial Statements” and EITF Issue No. 00-21, "Revenue Arrangements with
      Multiple Deliverables." Revenue is recognized when persuasive evidence of an
      agreement with the customer exists, products are shipped or title passes
      pursuant to the terms of the agreement with the customer, the amount due from
      the customer is fixed or determinable, collectibility is reasonably assured,
      and
      there are no significant future performance obligations. Service revenues are
      recognized at the time of performance. Extended service maintenance contract
      revenues are recognized ratably over the maintenance contract term, which is
      typically one year. The unrecognized revenue portion of maintenance contracts
      invoiced is recorded as deferred revenue. At February 29, 2008, deferred
      extended service maintenance revenues were $517,000 and deferred revenues
      related to the fair value of future performance obligations were $182,000 and
      are expected to be recognized as revenue in varying amounts throughout fiscal
      2008 and into fiscal 2009.





These
      policies require management, at the time of the transaction, to assess whether
      the amounts due are fixed or determinable, collection is reasonably assured,
      and
      if future performance obligations exist. These assessments are based on the
      terms of the agreement with the customer, past history and credit worthiness
      of
      the customer. If management determines that collection is not reasonably assured
      or future performance obligations exist, revenue recognition is deferred until
      these conditions are satisfied.





Our
      principal sources of revenues are from the sales of various satellite
      communications equipment. Embedded in our products is internally developed
      software of varying applications **.** We
      evaluate our products to assess whether software is more than incidental to
      a
      product. When we conclude that software is more than incidental to a product,
      we
      will account for the product as a software product. Revenue on software products
      and software-related elements is recognized in accordance with SOP
      No. 97-2,
      “Software Revenue Recognition” as amended by SOP No. 98-9, “Software Revenue
      Recognition, with Respect to Certain Transactions.” Significant
      judgment may be required in determining whether a product is a software or
      hardware product.





**Inventory
      Reserves** **-** Inventories
      are valued at the lower of cost (at standard cost, which approximates actual
      cost on a first-in, first-out basis) or market. Inventories include the cost
      of
      raw materials, labor and manufacturing overhead. We make inventory reserve
      provisions for obsolete or slow-moving inventories as necessary to properly
      reflect inventory value. These reserves are to provide for items that are
      potentially slow-moving, excess or obsolete. Changes in market conditions,
      lower
      than expected customer demand and rapidly changing technology could result
      in
      additional obsolete and slow-moving inventory that is unsaleable or saleable
      at
      reduced prices, which could require additional inventory reserve provisions.
      At
      February 29, 2008, inventories, net of reserve provisions, amounted to
      $4,083,000.




19




**Capitalized
      Software Costs** **-** Software
      development costs are capitalized subsequent to establishing technological
      feasibility. Capitalized costs are amortized based on the larger of the amounts
      computed using (a) the ratio that current gross revenues for each product bears
      to the total of current and anticipated future gross revenues for that product,
      or (b) the straight-line method over the remaining estimated economic life
      of
      the product. Expected future revenues and estimated economic lives are subject
      to revisions due to market conditions, technology changes and other factors
      resulting in shortfalls of expected revenues or reduced economic lives, which
      could result in additional amortization expense or write-offs. At February
      29,
      2008, capitalized software costs, net of accumulated amortization, amounted
      to
      $1,166,000 .





**Deferred
      Tax Asset Valuation Allowance** –
      Deferred tax assets are recognized for deductible temporary differences, net
      operating loss carryforwards, and credit carryforwards if it is more likely
      than
      not that the tax benefits will be realized. Realization of our deferred tax
      assets depends on generating sufficient future taxable income prior to the
      expiration of the loss and credit carryforwards. At **** February
      29, 2008, deferred tax assets in the amount of $5,916,000 were fully reserved
      by
      a valuation allowance. For the six months ended February 29, 2008, federal
      and
      state income tax expense provisions of $97,000 and $6,000, respectively, were
      fully offset by a decrease in the deferred tax asset valuation allowance which
      resulted in no income tax expense for the period.





**Accounts
      Receivable Valuation** –
      We maintain allowances for doubtful accounts for estimated losses resulting
      from
      the inability of our customers to make required payments. If the financial
      condition of our customers were to deteriorate, resulting in an impairment
      of
      their ability to make payments, additional allowances would be required. At
      February 29, 2008, accounts receivable, net of allowances for doubtful accounts,
      amounted to $4,202,000 .





**LIQUIDITY
      AND CAPITAL RESOURCES**


**SIX
      MONTHS ENDED FEBRUARY 29, 2008**




At
      February 29, 2008, our primary source of liquidity was a $5,000,000 bank loan
      facility, which is subject to availability advance formulas based on eligible
      accounts receivable, import letter of credit commitment balances and
      inventories. The loan facility consists of a term loan and a revolving line
      of
      credit with a combined borrowing limit of $5,000,000, bearing interest at the
      bank’s prime rate (6.0% at February 29, 2008). The bank retained the right to
      adjust the interest rate, subject to the financial performance of the Company.
      The loan facility matures on September 30, 2008, or upon demand, and requires
      an
      annual facility fee of 2% of the maximum credit limit. During the first six
      months of fiscal 2008, our line of credit net outstanding borrowings decreased
      $288,000 from $2,016,000 at August 31, 2007 to $1,728,000 at February 29, 2008.
      At February 29, 2008, **** approximately
      $1,467,000, net of outstanding letters of credit in the amount of $1,805,000,
      remained available to borrow under the advance formulas.





The
      term
      loan facility provides for a maximum of $1,000,000 for advances of up to 80%
      of
      the cost of equipment acquisitions. Principal advances are payable monthly
      over
      60 months with a balloon payment due at maturity. The revolving line of credit
      is subject to availability advance formulas of 80% against eligible accounts
      receivable; 20% of eligible raw materials inventories; 20% of eligible
      work-in-process kit inventories; and 40% to 50% of eligible finished goods
      inventories and 50% of import letter of credit commitment balances. In addition,
      the facility provides for advances in excess of the availability formulas of
      up
      to $1,000,000 during the term of the facility. The loan is secured by a first
      lien on substantially all of WCI’s assets, including land and buildings, and is
      guaranteed by Wegener Corporation. At February 29, 2008, balances outstanding
      on
      the revolving line of credit amounted to $1,728,000. No borrowings were
      outstanding under the equipment term loan portions of the loan facility. The
      loan facility is also used to support import letters of credit issued to
      offshore manufacturers, which at February 29, 2008, amounted to
      $1,805,000.





At
      February 29, 2008, approximately $1,467,000, net of outstanding letters of
      credit, was available to borrow under the advance formulas. During the first
      six
      months of fiscal 2008, the line of credit average daily balance outstanding
      was
      $1,536,000 and the highest outstanding balance was $3,274,000. During the
      remainder of fiscal 2008 we expect the average daily balance to increase. We
      believe the loan facility will be sufficient to support operations over the
      next
      12 months.





Under
      the
      loan facility, at the end of fiscal 2008 we are required to maintain a minimum
      tangible net worth. In addition, we are required to retain certain executive
      officers, maintain certain financial ratios, and are precluded from paying
      dividends.





During
      the first six months of fiscal 2008, operating activities provided $1,044,000
      of
      cash. Net earnings adjusted for expense provisions and depreciation and
      amortization (before working capital changes) provided $1,269,000 of cash,
      while
      changes in accounts receivable and customer deposit balances
      provided  $179,000
      of cash. Changes in accounts payable and accrued expenses, inventories, deferred
      revenue and other assets used  $403,000
      of cash. Cash used by investing activities was $202,000 for property and
      equipment expenditures, $545,000 for capitalized software additions and $12,000
      for legal fees related to the filing of applications for various patents and
      trademarks. Financing activities used $288,000 of cash for net line-of-credit
      repayments.




20




At
      February 29, 2008, we had land and buildings with a cost basis of $4,457,000
      (including land held for sale of $354,000). Although land and buildings are
      subject to a lien under the loan facility, they are not currently used in the
      existing loan facility’s availability advance formulas and have no mortgage
      balances outstanding. While no assurances may be given, we believe these assets
      could be used to support additional overall borrowing capacities either with
      our
      existing bank or from other sources. During the third quarter of fiscal 2007,
      the Company’s Board of Directors authorized and approved the listing for sale of
      the 4.4 acres of undeveloped land located adjacent to the Company’s headquarters
      facility in Duluth (Johns Creek), Georgia (see note 4 to the consolidated
      financial statements). Proceeds from the sale of the land would be used to
      pay
      any balances outstanding on the revolving line of credit.





We
      have
      three manufacturing and purchasing agreements for certain finished goods
      inventories. At February 29, 2008, outstanding purchase commitments under these
      agreements amounted to $3,625,000. Pursuant to the above agreements, at February
      29, 2008, we had outstanding letters of credit in the amount of
      $1,805,000.





The
      Company has never paid cash dividends on its common stock and does not intend
      to
      pay cash dividends in the foreseeable future.




A
      summary
      of the Company’s long-term contractual obligations as of February
      29, 2008 consisted of:




Payments Due by PeriodContractual
                Obligations
            
            Total
            
            Fiscal
              2008
            
            Fiscal
              2009-2010
            
            Fiscal
              2011-2012Operating
                leases
            
            $
            159,000
            
            $
            90,000
            
            $
            69,000
            
            $
            -Bank
                line of credit
            
            
            1,728,000
            
            
            -
            
            
            1,728,000
            
            
            -Purchase
                commitments
            
            
            3,625,000
            
            
            3,625,000
            
            
            -
            
            
            -Total
            
            $
            5,512,000
            
            $
            3,715,000
            
            $
            1,797,000
            
            $
            -




**ITEM
      3.**  **QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**




Our
      exposure to market rate risk for changes in interest rates relates primarily
      to
      our revolving line of credit and cash equivalents. The interest rate on certain
      advances under the line of credit and term loan facility fluctuates with the
      bank’s prime rate (6.0% at February 29, 2008). At February 29, 2008, line of
      credit outstanding borrowings amounted to  $1,728,000.





We
      do not
      enter into derivative financial instruments. All sales and purchases are
      denominated in U.S. dollars.




**ITEM
      4. CONTROLS AND PROCEDURES**




Not
      applicable





**ITEM
      4T.**  **CONTROLS
      AND PROCEDURES**




The
      Company carried out an evaluation, under the supervision and with the
      participation of the Company’s management, including the Chief Executive Officer
      (CEO) and the Chief Financial Officer (CFO), of the effectiveness of the design
      and operation of the Company’s disclosure controls and procedures as of the end
      of the period covered by this report (February 29, 2008). Based upon that
      evaluation, the Company’s CEO and CFO have concluded that the Company’s
      disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
      of the Securities Exchange Act of 1934, as amended) are effective. There has
      been no change in the Company’s internal control over financial reporting during
      our most recent fiscal quarter that has materially affected, or is reasonably
      likely to materially affect, the Company’s internal control over financial
      reporting.





21




**PART
      II. OTHER INFORMATION**





**ITEM
      1A. RISK FACTORS**





Our
      operations and financial results are subject to various risks and uncertainties
      that could adversely affect our business, financial condition, results of
      operations, and the market price for our Common Stock. Part I,
      Item 1A, “Risk Factors” of our Annual Report on Form
      10-K
      for the year ended August 31, 2007 ,
      includes a detailed discussion of these factors which have not changed
      materially from those included in the Form 10-K, other than as set forth
      below.




**The** **Nasdaq
      Stock Market may delist our securities, which could limit investors’ ability to
      trade in our securities.**





On
      December 26, 2007, we received a notice from The Nasdaq Stock Market (“Nasdaq”)
      indicating that for the last 30 consecutive business days, the bid price of
      our
      common stock has closed below the minimum $1.00 per share requirement for
      continued inclusion under Marketplace Rule 4310(c)(4) (the “Rule”). The notice
      also stated that we have been provided with 180 calendar days, or until June
      23,
      2008, to regain compliance in accordance with Marketplace Rule 4310(c)(8)(D).
      If, at anytime before June 23, 2008, the bid price of our common stock closes
      at
      $1.00 per share or more for a minimum of 10 consecutive business days, the
      Nasdaq staff will provide written notification that we comply with the
      Rule.





If
      we
      cannot regain compliance by June 23, 2008, the Nasdaq staff will determine
      whether we meet The Nasdaq Capital Market initial listing criteria set forth
      in
      Marketplace Rule 4310(c), except for the bid price requirement. If we meet
      the
      initial listing criteria, the Nasdaq staff will notify us that we have been
      granted an additional 180 calendar day compliance period. If we are not eligible
      for an additional compliance period, the Nasdaq staff will provide written
      notification that our securities will be delisted. At that time, we may appeal
      the Nasdaq staff’s determination to delist our securities to a Listing
      Qualifications Panel.





If
      our
      common stock is delisted by Nasdaq, the trading market for our common stock
      would likely be adversely affected, as price quotations may not be as readily
      obtainable, which would likely have a material adverse effect on the market
      price of our common stock.





**ITEM
      4.**  **SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**




On
      January 22, 2008, the Annual Meeting of Shareholders was held and the shares
      present voted on the following matters:




(1.)
            The
                  shareholders approved the election of the following nominees to
                  the Board
                  of Directors
                to serve for a term of three years expiring in
                2011:


Phylis
      A.
      Eagle-Oldson (Class I Director)


10,249,095
      votes FOR


2,002,918
      votes WITHHELD





C.
      Troy
      Woodbury, Jr. (Class I Director)


10,216,801
      votes FOR


2,035,212
      votes WITHHELD




The
      terms
      of office of Jeffrey J. Haas, Robert A. Placek and David W. Wright as Class
      II
      directors, and of Thomas G. Elliot, Stephen J. Lococo and Ned L. Mountain as
      Class III directors, continued subsequent to the Annual Meeting.





(2.)
            The
                appointment of BDO Seidman, LLP as auditors for the Company for the
                fiscal
                year 2008 was approved with 11,975,496 votes FOR, 228,206 votes AGAINST,
                and 48,312 votes ABSTAINING.





22




**I** **TEM** **6.** **EXHIBITS**





The
      following documents are filed as exhibits to this report. An asterisk identifies
      those exhibits previously filed and incorporated herein by reference. For each
      such asterisked exhibit there is shown below the description of the prior
      filing. Exhibits which are not required for this report are
      omitted.





**Exhibit
                No.**
            
            **Description
                of Exhibit**3.1
            *
            Certificate
                of Incorporation as amended through May 4, 1989. (1)3.1.1
            *
            Amendment
                to Certificate of Incorporation. (2)3.2
            *
            By-laws
                of the Company, as Amended and Restated May 17, 2006.
                (3)31.1
            
            Certification
                of the Chief Executive Officer pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.31.2
            
            Certification
                of the Chief Financial Officer pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002.32.1
            
            Certification
                of the Chief Executive Officer pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002.32.2
            
            Certification
                of the Chief Financial Officer pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002.




(1)
            
            Incorporated
                by reference to the Company's Annual Report on Form 10-K for the
                fiscal
                year ended September 1, 1989, as filed with the Commission on November
                30,
                1989.+(2)
            
            Incorporated
                by reference to the Company's Quarterly Report on Form 10-Q for the
                quarter ended May 30, 1997, as filed with the Commission on June
                30,
                1997.+(3)
            
            Incorporated
                by reference to the Company's Current Report on Form 8-K, dated May
                17,
                2006, as filed with the Commission on May 22, 2006.++
            
            SEC
                file No. 0-11003




23





SIGNATURES




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




WEGENER
                  CORPORATION(Registrant)Date:
                  April 10, 2008
              By:
              
              /s/
                  Robert A. PlacekRobert
                  A. PlacekChairman of the Board, President andChief Executive Officer(Principal Executive Officer)Date:
                  April 10, 2008
              By:
              
              /s/
                  C. Troy Woodbury, Jr.C.
                  Troy Woodbury, Jr.Treasurer and ChiefFinancial Officer(Principal
                  Financial and Accounting Officer)
  24