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Item 1. Business

2022-09-29 compared with 2021-10-04 · 319 added, 337 removed, 202 unchanged (76% of the section changed)

We are a leading global provider of next-generation 911 emergency systems ("NG-911") and secure wireless communications technologies.

Our solutions fulfill our customers’ needs for secure wireless communications in some of the most demanding environments, including those where traditional communications are unavailable or cost-prohibitive, and in mission-critical and other scenarios where performance is crucial.

In recent years, an increase in market demand for global voice, video and data usage has contributed to our growth.

Founded in 1967, we are a leading global provider of next-generation 911 emergency systems ("NG-911") and secure wireless and satellite communications technologies.

We see these two end-markets as part of what Comtech has identified as the “Failsafe Communications Market.” This includes the critical communications infrastructure that people, businesses, and governments rely on when durable, trusted connectivity is required, no matter where they are – on land, at sea, or in the air – and no matter what the circumstances – from armed conflict to a natural disaster.

Our solutions are designed to fulfill our customers’ needs for secure wireless communications in the most demanding environments, including those where traditional communications are unavailable or cost-prohibitive, and in mission-critical and other scenarios where performance is crucial.

We anticipate future growth in our business due to increasing demand for global voice, video and data usage.

We provide our solutions to both commercial and governmental customers.

As more fully described elsewhere in this Form 10-K, we navigated the challenges of operating our global business during the period where COVID-19 impacted many of our customers.

We achieved fiscal 2021 consolidated net sales of $581.7 million and achieved significant year-over-year bookings and backlog growth.

We completed the acquisition of a leading provider of innovative and disruptive satellite ground station technology solutions.

We also entered into a multi-year agreement enabling a large new customer to potentially order hundreds of millions of dollars of our next-generation satellite earth station technology that can be used with thousands of Low-Earth-Orbit ("LEO") satellites reportedly being launched over the next several years.

Adding to our strength, we won over $200.0 million of new NG-911 contract awards that we believe can provide years of recurring revenue.

We believe that as COVID-19 subsides and the global economy fully reopens, our business performance in future periods will improve from current levels.

Our Business Outlook for Fiscal 2022 is discussed further in Part II - "Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations - Impact of COVID-19 and Business Outlook for Fiscal 2022 ." For a definition and explanation of Adjusted EBITDA, see Part II - "Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - Comparison of Fiscal 2021 and 2020 - Adjusted EBITDA ."

Our Internet website is www.comtechtel.com and we make available on our website:

our filings with the Securities and Exchange Commission ("SEC"), including annual reports, quarterly reports, current reports and any amendments to those filings.

The reference to our website address does not constitute incorporation by reference of the information contained therein into this Form 10-K.

We also use our website to disseminate other material information to our investors (on the Home Page and in the "Investor Relations" section).

Among other things, we post on our website our press releases and information about our public conference calls (including the scheduled dates, times and the methods by which investors and others can listen to those calls), and we make available for replay webcasts of those calls and other presentations for a limited time.

We also use social media channels to communicate with customers and the public about our Company, our products, services and other issues, and we use social media and the Internet to communicate with investors, including information about our stockholder meetings.

Information and updates about our Annual Meetings will continue to be posted on our website at www.comtechtel.com in the "Investor Relations" section.

We are incorporated in the state of Delaware and were founded in 1967.

Corporate Strategies

We intend to manage our business with the following principal corporate strategies:

• Seek leadership positions in markets where we can provide differentiated products and technology solutions;

• Identify and participate in emerging technologies that enhance or expand our product portfolio;

• Maximize responsiveness to our customers, including offering more integrated systems and solutions;

• Expand and further penetrate our diversified and balanced customer base;

• Pursue acquisitions of complementary businesses and technologies.

Competitive Strengths

The successful execution of our principal corporate strategies is based on our competitive strengths, including the following:

(1) We Have Significant Exposure to Large, Growing End Markets

We believe we are well positioned to capitalize on some of the most significant long-term technology trends occurring worldwide and that customers around the world will increasingly turn to us to fulfill their needs for secure wireless communications in some of the most demanding environments, including those where traditional communications are unavailable or cost-prohibitive, and in mission-critical and other scenarios where performance is crucial.

These important technology trends include the expansion of 5G mobile networks and the integration of satellite communications into mobile phones, the need for public safety agencies to seamlessly integrate various networks and protocols and utilize precise location to connect individuals with first responders, the expanding breadth of High Definition ("HD") and 4K broadcasting content, and the need for governments to have more modern and mobile communications and transmission equipment to successfully complete mission-critical goals.

We believe that all these long-term trends generate growth in global voice, video and data usage that, in turn, drives increased long-term demand for the secure wireless communications solutions that we provide.

We are in the process of further focusing both our research and development and marketing efforts to advance our next-generation satellite technology solution offerings that are targeted for use on new broadband satellite constellations.

Thousands of new LEO, medium-earth-orbit ("MEO") and even geosynchronous equatorial orbit ("GEO") satellites are reportedly being launched over the next several years.

Satellite constellations will provide internet access across the world, support increasing demand for data transmission, and will be facilitated by solutions that we provide, including ground station equipment such as Single Channel per Carrier ("SCPC") and time division multiple access (“TDMA”) modems, solid-state amplifiers and X/Y steerable antennas.

In fiscal 2021, we entered into a strategic and highly valued multi-year agreement enabling a large new customer to potentially order hundreds of millions of dollars of our next-generation satellite earth station technology that can be used with the thousands of LEO satellites reportedly being launched over the next several years.

Shortly after we signed this agreement, we received our first order valued at more than $13.0 million to make certain customizations on behalf of this customer.

Work on these efforts commenced immediately.

(2) We Believe We Are a Market Leader in the End-Markets That We Serve

Commercial Solutions Segment

Satellite Ground Station Technologies - We believe we are the leading provider of satellite earth station modems, solid-state amplifiers and traveling wave tube amplifiers.

Many of our key satellite earth station modems incorporate Turbo Product Code ("TPC") or Low Density Parity Check ("LDPC") forward error correction and bandwidth compression technologies, which enable our customers to optimize their satellite networks by either reducing their satellite transponder lease costs or increasing data throughput.

We hold leadership positions in the market for high throughput modems used in cellular backhaul, a market that has been rapidly growing due to increased mobile phone use as well as LTE and 5G deployments.

In fiscal 2021, we added to our product portfolio software-defined TDMA technology, which delivers industry-leading bandwidth-efficiency and flexibility to our customers.

Our amplifier products are used to amplify signals carrying voice, video or data for air-to-satellite-to-ground communications and are vital to satellite communication applications such as traditional broadcast, direct-to-home ("DTH") broadcast and satellite newsgathering.

We differentiate our amplifier product offerings by our ability to develop the most efficient size, weight and power profile.

We believe that our expertise complying with regulatory and performance restrictions, particularly in challenging frequency bands such as X, Ka and Q, is a key differentiator.

Demand for equipment in these challenging frequency bands is expected to grow over the coming years as new constellations are launched, such as Amazon Kuiper, SpaceX Starlink, Telesat Lightspeed and High Throughput Satellites ("HTS") from other providers.

Certain of our amplifiers are DO-160 certified (an airborne quality standard) and when incorporated into an aircraft satellite communication system, can provide passengers, both commercial and military, with email, Internet access and video conferencing.

Public Safety and Location Technologies - In fiscal 2021, we were recognized by Frost & Sullivan, a leading industry research firm, for registering the most significant year-over-year market share increase among all NG-911 primary contract holders, growing our market share from an estimated 17.3% in 2019 to 26.2% in 2020, as calculated by Frost & Sullivan.

By closing statewide contracts in Arizona, Iowa, Ohio, Pennsylvania and South Carolina, our direct NG-911 contracts now represent a population of over 60 million in the U.S., and over 25 million in Australia via Next Generation 000 contracts.

As such, we believe that we are a leader in public safety communication and location technologies.

We meet the ISO 27001 data security standard and believe we have significant market share in the routing of U.S.

wireless 911 calls, Voice over Internet Protocol ("VoIP") 911 calls and Text to 911 messaging.

We believe we are one of a limited number of companies fulfilling the Federal Communications Commission ("FCC") requirements for Enhanced 911 ("E911") call-routing to Public Safety Answering Points ("PSAPs") for wireless and VoIP network operators.

E911 refers to 911 calls for both wireline and wireless telephones that are enhanced to provide the caller's location information.

We are focusing our marketing and research and development efforts to meet system standards for NG-911, which refers to an Internet Protocol ("IP") based system that defines how digital information (e.g., voice, photos, videos and text messages) flows seamlessly from the public to the PSAPs, and on to emergency responders.

With more than 85 global deployments of our Location Based Services (“LBS”) platform, we are a leading global provider of device location for both public safety and commercial applications.

Leveraging decades of our location-based technology expertise, our solutions support the generation and distribution of location information for both indoor and outdoor environments.

We have developed industry leading 2G through 5G mobile network and WiFi location functions, robust mapping, navigation and geolocation solutions incorporated by industry verticals such as public safety, automotive manufacturing, mobile network operators (“MNOs”) and retail.

We provide a high-capacity, multiprotocol Short-Messaging-Service (“SMS”) platform for Person-to-Person (“P2P”), Application-to-Person (“A2P”) and Machine-to-Machine (“M2M”) communications.

In addition, we offer Location Studio®, a complete end-to-end location application platform consisting of maps, map data, geo-services, application program interfaces (“APIs”) and software development kits ("SDKs") enabling MNOs, application developers, public safety ecosystems, and enterprises to build custom and unique applications.

Government Solutions Segment

Tactical Communications Technologies - We are a key supplier to large governments (particularly the U.S.

government) and large prime contractors for tactical communications technologies, primarily tactical satellite-based technology solutions, field support services and satellite component supply chain management.

We are a prime contractor under several indefinite delivery, indefinite quantity ("IDIQ") defense contract vehicles, including the:

Army’s Global Tactical Advanced Communications Systems ("GTACS") contract;

Army’s Global Tactical Advanced Communications Systems (“GTACS II”) contract;

Navy’s Seaport Next Generation (“SeaPort-Nxg”) contract;

(iv) Complex Commercial SATCOM Solutions ("CS3") contract;

(v) Communications Electronics Command ("CECOM") Responsive Strategic Sourcing for Services ("RS3") contract with the U.S.

Army Contracting Command - Aberdeen Proving Ground (“ACC-APG”);

and (vi) Advanced Battle Management System ("ABMS") contract for the Air Force Life Cycle Management Center.

Business Segments

In the fourth quarter of fiscal 2022, we revised our business segments to better align them with end-markets for our products and services.

Our businesses have been re-organized into two new reportable segments:

“Satellite and Space Communications” and “Terrestrial and Wireless Networks.” All current and prior periods reflected in this Form 10-K have been presented according to these two new segments, unless otherwise noted.

For more information and for financial information about our business segments, including net sales, operating income, Adjusted EBITDA (a Non-GAAP financial measure), total assets, and our operations outside the United States, refer to " Notes to Consolidated Financial Statements - Note (11) Segment Information" included in "Part II - Item 8 - Financial Statements and Supplementary Data ."

We offer advanced secure wireless communications technologies founded on decades of expertise in the satellite communications and cellular markets.

We believe these markets are undergoing a period of long-term growth, reinvestment, and rapid technological change.

We manage our business through two reportable operating segments:

Satellite and Space Communications and Terrestrial and Wireless Networks.

Our senior management team supports these business segments by, among other things, actively seeking to identify and leverage synergies that exist between the segments, including in areas such as manufacturing, technology, sales, marketing, customer support and finance.

The diagram below summarizes our key products, systems, and services by our two reportable operating segments:

Satellite and Space Communications Segment

(Approximately 58% of fiscal 2022 net sales) Terrestrial and Wireless Networks Segment

(Approximately 42% of fiscal 2022 net sales)

• Satellite ground station technologies, services and system integration that facilitate the transmission of voice, video and data over GEO, MEO and LEO satellite constellations, including solid-state and traveling wave tube power amplifiers, modems, VSAT platforms and frequency converters

• Satellite communications and tracking antenna systems, including high precision full motion fixed and mobile X/Y tracking antennas, RF feeds, reflectors, and radomes

• Over-the-horizon microwave equipment that can transmit digitized voice, video, and data over distances up to 200 miles using the troposphere and diffraction, including the Comtech COMET TM

• Solid-state, RF microwave high-power amplifiers and control components designed for radar, electronic warfare, data link, medical and aviation applications

• Procurement and supply chain management of high reliability EEE parts for satellite, launch vehicle and manned space applications

• Field support sustainment services and technology insertion services primarily supporting tactical VSAT systems, Blue Force Tracking Systems and cybersecurity training services

• Wireless/VolP 911 location and routing services to connect emergency calls to Public Safety Answering Points

• SMS Text to 911 services, providing alternate paths for individuals who need to request assistance (via text messaging) a method to reach Public Safety Answering Points

• Next Generation 911 solutions, providing emergency call routing, location validation, policy-based routing rules, logging, and security functionality

• Emergency Services IP Network transport infrastructure for emergency services communications and support of Next Generation 911 services

• Call handling applications for Public Safety Answering Points

• Wireless emergency alerts solutions for network operators

• Software and equipment for location-based and text messaging services for various applications, including for public safety, commercial and government services

• Cybersecurity training, skills labs, and competency assessments for both technical and non-technical applications

The markets and key technologies for each segment are further described below.

Satellite and Space Communications Segment

Our Satellite and Space Communications segment designs, builds and supports a variety of sophisticated communications equipment that is designed to meet or exceed the highest standards for performance and quality by businesses and governments worldwide.

Applications of our equipment include high-throughput cellular backhaul solutions, modern troposcatter communications equipment, satellite ground station systems, electronic components engineered for use in outer space and high-powered RF/microwave amplifiers and control components.

Our customers and end-users include the world’s largest corporations, governments and defense agencies, including the U.S.

Our Satellite and Space Communications segment has four product areas:

Satellite Modem and Amplifier Technologies, Troposcatter and SATCOM Solutions, Space Components and Antennas, and High-Power Amplifiers and Switches.

Satellite Modem and Amplifier Technologies

We believe we are a leading provider of satellite earth station modems, solid-state amplifiers and traveling wave tube amplifiers.

Many of our key satellite earth station modems incorporate forward error correction and bandwidth compression technologies, which enable our customers to optimize their satellite networks by either reducing their satellite transponder lease costs or increasing data throughput.

We hold leadership positions in the market for high-throughput modems used in cellular backhaul, a market that has been rapidly growing due to increased mobile phone usage and increasing data throughput demands from LTE and 5G deployments worldwide.

An estimated 3 billion people globally remain unconnected to any wireless services, representing a significant opportunity.

In fiscal 2021, we introduced a Time Division Multiple Access ("TDMA") technology solution which offers best-in-class support for very large satellite networks that use Very Small Aperture Terminals (“VSATs”).

This technology allows our customers to cost-effectively provide wireless services to end-users in complex geographies or areas where cellular infrastructure is otherwise unavailable.

In fiscal 2022, we introduced ELEVATE™, a revolutionary solution that combines our Heights Dynamic Network Access ("H-DNA") and TDMA technologies into a single VSAT platform that delivers increased value to our customers by enabling private or shared VSAT networks of any size and topology on a single unified platform.

To date, although sales cycles are long, we have made good progress in securing several significant orders for ELEVATE™.

We also provide rugged, highly efficient, and reliable amplifiers for commercial and military applications around the world.

These High-Power Amplifiers (“HPAs”) are used in critical communications links on the ground, in the air and on the sea;

they support fixed traditional and direct-to-home broadcast, mobile news gathering, transportable and flyaway systems, secure high data rate communications, and broadband access over satcom.

These products include configurations that are formally qualified for use on aircraft.

Finally, we believe we are well-positioned in the millimeter wave ("mmWave") market and expect that market to continue to grow as new satellite constellations move into those higher, less crowded frequencies.

The Ka band LEO and MEO amplifiers that we design and manufacture for large commercial customers’ non-GEO constellations represent key strategic wins as we build position in higher frequency bands.

Troposcatter and SATCOM Solutions

With persistent threats from state and non-state actors, governments around the world are increasingly seeking ways to mitigate vulnerabilities using information and more reliable communication systems to increase decision-makers’ situational awareness.

Many of our mission-critical technologies are part of integrated communication infrastructure systems such as the U.S.

military's Command, Control, Communications, Computers, Cyber Intelligence, Surveillance and Reconnaissance (also known as "C5ISR") systems and similarly complex networks for international governments.

We believe we are a world leader in the design and supply of troposcatter equipment.

We have designed, manufactured, and delivered troposcatter systems (sometimes referred to as over-the-horizon ("OTH") microwave products and systems) for over fifty years.

Our OTH systems, which include our patented forward error correction technology, can transmit video and other broadband applications at high throughputs in the most demanding environments:

and foreign governments use our over-the-horizon microwave systems to, among other things, transmit radar tracking, run C5ISR applications and connect to remote border locations.

Additionally, energy companies use our systems to enable communication links for offshore oil rigs and other remote locations, as well as for exploration activities.

The Comtech COMET™, introduced two years ago, is a rapidly deployable OTH microwave system that directly addresses a void in capabilities that have long been desired by tactical communications planners:

low probability of intercept and low probability of detection (“LPI/LPD”), while providing high reliability, mission essential communications.

The COMET™ is capable of being transported in a carrying case by a single individual and set up in under fifteen minutes, extending critical services into areas where there is no communications infrastructure, or the infrastructure has been destroyed.

Special Forces, as well as non-U.S.

NATO forces, have already begun procuring and deploying the COMET™ for high reliability, mission essential communications.

We provide field support sustainment services, centralized and deployed depot services, and technology insertion services to the U.S.

Army’s AN/TSC-198 family of communication systems that are commonly referred to as "SNAP" (Secret Internet Protocol Router ("SIPR") and Non-secure Internet Protocol Router ("NIPR") Access Point) Very Small Aperture Terminals ("VSATs").

We also provide sustainment services for the U.S.

Army’s Blue Force Tracking-1 ("BFT-1") system in addition to support for Army IP networks.

Our field support services include providing U.S.

Department of Defense ("DoD") personnel with curriculum development and training services to support cybersecurity workforce development.

We provide high reliability Electrical, Electronic and Electromechanical (“EEE”) parts for use in satellite, launch vehicle and manned space applications.

We also provide services encompassing all aspects of ground station life cycle to include requirements definition and analysis;

design, development and integration of turnkey systems from antenna to data processing;

civil works and construction;

station installation and verification;

operations and maintenance;

and decommissioning at end of life.

We also provide to customers worldwide a line of X/Y steerable satellite tracking antenna systems ideal for LEO, MEO and GEO constellations.

High-Performance Transmission Technologies - We are a world leader in the design and supply of troposcatter equipment, and a key supplier of radio frequency ("RF") microwave solid-state, high-power amplifier and switching control technologies.

We have designed, manufactured and delivered troposcatter systems (sometimes referred to as over-the-horizon ("OTH") microwave products and systems) for over fifty years and are one of the largest independent suppliers of solid-state, high-power RF microwave amplifiers and integrated transmit receive hardware, which reproduce signals with higher power, are extremely complex, and are critical to the performance of the systems into which they are incorporated.

Our CS67PLUS software defined, adaptive troposcatter radio can operate at over 200 megabits per second ("Mbps").

The radio is MIL-STD 461 EMI and MIL-STD 810G environmentally compliant.

Our Modular Tactical Transmission System ("MTTS") provides a high capacity, troposcatter and beyond-line-of-sight modular communications system designed for easy and rapid deployment.

Our best-in-class troposcatter solutions led to our equipment being chosen to be used on the U.S.

Marine Corps’ next generation troposcatter system Program of Record.

These dual frequency systems are designed to operate in harsh environmental conditions and are protected from Electromagnetic Interference and Electromagnetic Pulse (“EMI/EMP”).

Many solid-state RF microwave amplifier and switching control technologies are produced in-house by large companies;

however, our expertise has created a cost-effective and technologically superior alternative to in-house sourcing.

Some of the companies who have outsourced amplifier development and production to us include Rockwell Collins, Inc., European Aeronautic Defense and Space Company ("EADS"), Lockheed Martin Corporation, L3Harris Technologies, Inc., Northrop Grumman Corporation, BAE Systems Plc, the U.S.

Navy and Raytheon Technologies Corporation.

Our amplifiers are also used in oncology treatment systems that allow physicians to give cancer patients higher doses of radiation that are more closely focused on cancerous tissue, thereby minimizing damage to healthy tissue.

(3) We Believe We Provide Industry Leading Innovation, Capabilities and Solutions

We have established a leading position of technology innovation in our fields through internal and customer-funded research and development activities, which have yielded significant advances.

Examples of our industry-leading innovation include:

Our VSAT Networking Technologies and Platforms – For the past several years, we have developed and manufactured Heights TM ("Heights").

Heights TM is an advanced satellite earth station networking platform that combines our most efficient waveforms, compression engines and the ability to provide dynamic bandwidth and power management to meet the demands of customers operating on traditional fixed satellite service systems ("FSS"), while providing advantages for customers who plan to transition to HTS systems in the future.

Heights TM is ideally suited for cellular backhaul, universal service obligation networks and other applications that require high performance in a hub-spoke environment.

Heights TM solutions are designed to deliver the highest Internet Protocol bits per Hertz in its class.

In fiscal 2021, we introduced a TDMA technology solution which offers best-in-class support for very large networks.

With an estimated 3 billion people globally who are not connected to any wireless services, this technology allows our customers to cost-effectively provide services to end-users with the quality and reassurance of the Comtech brand and service offerings.

We also intend to offer a solution that combines our Heights Dynamic Network Access ("H-DNA") and TDMA technologies in a single VSAT platform so that we can deliver a solution that will deliver increased value to our customers.

Additionally, at the start of our fiscal 2022, we announced a technology and business development partnership with Kymeta Corporation, a satellite communications company to broaden network offerings by combining the Kymeta TM u8 terminal with our SLM-5650B modem and UHP-200 Universal Satellite Router.

This solution will enable new and existing U.S.

Department of Defense and commercial customers to operate state-of-the art technologies using cost-effective and seamless VSAT router solutions.

Our Solacom Software Solutions – We offer a best-in-class call handling solution marketed under the Solacom Guardian brand name, which provides an integrated text-to-and-from 911 solution on a unified platform.

Space Components and Antennas

For over 45 years, we have been recognized as an industry leader and global supplier of high-reliability products and supply chain management and engineering services, supporting selection of space-qualified parts for satellite and launch vehicle tracking solutions geared for critical NASA programs as well as several international space and defense agencies.

Our engineers are not only involved in the design of products, but our technical team is heavily involved with the customer development of electronic parts and testing specifications to assure capability, reliability and radiation tolerance to specific mission/project requirements both as an individual service and for Electrical, Electronic, and Electromechanical (“EEE”) parts supplied to our customers.

We also lead and conduct failure analysis investigations and assist with manufacturing and test problems at the source and support reporting and selloff with the customer and its prime (such as the Japanese Space Exploration Agency (“JAXA”) and NASA).

Our quality engineering team assures that the product received from our suppliers and test facilities are compliant to their respective specifications prior to shipment to our end customers.

Most recently, our service offerings have been expanded to include kitting to customer Bill of Materials with direct shipments to customer designated contract manufacturers.

Within the satellite communications market, we are a leading provider of X/Y terminal solutions that fully support the mission requirements of LEO, MEO and GEO satellite communication and tracking requirements, offering a host of high-performance single-band and multi-band feed solutions.

We also supply maritime antenna solutions that are fielded by foreign governments.

High Power Amplifiers and Switches

We offer several unique high-performance transmit and receive technologies used in sophisticated communication systems, including electronic warfare, radar, data link, medical and identification friend or foe ("IFF").

As our customers push the envelope for mobility, speed and frequency, we believe that demand for high-performance transmission products will increase over time.

Our solid-state, high-power RF microwave amplifiers and related switching control technologies are utilized in many critical applications, including electronic warfare, communications, radar, data link, IFF and medical applications (such as oncology treatment systems).

In the electronic warfare marketplace, we support a variety of legacy systems and are participating in the ongoing migration to platforms that require smaller and lighter amplifiers integrated with additional signal processing functionality, providing more complete transmit and receive functionality.

Our solutions are designed to increase the flexibility of systems by providing wider bandwidth capabilities to address increased data transmission needs in challenging environments.

We also believe the desire for increased airspace situational awareness will create increased opportunities for our radar and IFF products, which are used by government and commercial customers around the world.

Our high power and highly reliable Gallium Nitride ("GaN") amplifier technology is increasingly used both to update existing radar systems for improved sensitivity and range, as well as for new radar applications and installations.

In addition to technologies that enhance performance of primary radars, we also supply solutions for IFF systems that provide positive identification of radar targets for secondary surveillance systems.

Satellite and Space Communications:

Key Markets and Growth Drivers

Combined, our Satellite and Space Communications segment offers our customers one-stop-shopping for sophisticated satellite ground station technologies and solutions, including SCPC and TDMA modems, amplifiers, antennas, frequency converters and network software for customers who utilize satellite communications.

Our products are used to modulate, demodulate and amplify signals, carry voice, video and/or data over networks and are vital to satellite communication applications, including air-to-ground communications, video broadcasting and the backhaul of cellular traffic.

Our Satellite and Space Communications segment manufactures most of the satellite ground station equipment we sell to our customers.

We believe that the overall satellite ground station equipment industry will grow from current levels and will be increasingly combined with existing and new cellular networks.

This growth is expected to occur because of widespread deployment of, and upgrades to, 4G and 5G ground-based systems, including satellite earth stations, as well as the integration of high-performance amplifiers necessary to meet long-term demand for high-performance satellite communications applications, such as satellite-based wireless backhaul, DTH, HD and 4K broadcasting, and in-flight connectivity.

We believe that Comtech is well-positioned to capitalize on this demand through sales of our market-leading satellite ground station technologies, including new next-generation satellite earth station technologies that can be used with the thousands of new LEO, MEO and large HTS satellite constellations that are expected to be deployed over the next several years.

Examples of end-market applications that are driving long-term demand for our satellite-based communication technologies include:

• New LEO, MEO and HTS Satellites:

Thousands of new satellites are reportedly being launched over the next several years, according to announcements by companies including Telesat Lightspeed, OneWeb, SpaceX Starlink, Amazon Kuiper and Viasat, which we believe will lead to increasingly complex satellite networks.

As service providers work to offer connectivity to these high-speed, high-bandwidth satellites and expand their networks to handle the demand for new LEO, MEO and HTS applications, we believe our ELEVATE ™ , Heights TM and UHP networking platforms, our solid-state amplifiers and our X/Y antennas will ultimately be incorporated into many new installations and equipment upgrades.

We continue to provide modems and amplifiers to existing LEO and MEO communications satellite providers and expect to see growth in imaging satellites alongside commercial imaging constellations, including conventional, thermal, and hyperspectral.

• Satellite-Based Cellular Backhaul:

Demand for satellite-based cellular backhaul services is anticipated to grow rapidly as a result of the increased penetration of smart cellular phones and network upgrades to 4G and 5G in developing regions of the world.

Ultimately, as 5G services continue to be deployed, we expect that mobile data services will become more critical.

As mobile data penetration expands and mobile data consumption increases, wireless carriers must invest in their mobile network infrastructures, and we believe businesses will require back-up communications.

In developing regions of the world, and in remote areas where terrestrial network infrastructure is lacking (or where challenging geography prohibits it), wireless network operators often backhaul, or transport, their wireless data traffic using satellite-based networking technologies.

Comtech is well positioned to serve the high-performance, high availability needs of satellite-based cellular backhaul through sales of our SCPC and TDMA satellite modems as well as our Heights TM , ELEVATE TM and UHP networking platforms.

• Government and Military Satellite Communications:

Government users rely on high-speed connectivity in a variety of conditions throughout the world to provide real time information sharing, including Situational Awareness (“SA”), dissemination of Intelligence, Surveillance, and Reconnaissance (“ISR”) information, and communications.

Our communications solutions provide command and control and satellite networking capabilities that support U.S.

and allied government initiatives for assured and resilient communications capabilities, as well as supporting interoperability objectives, including the Joint All Domain Command and Control (“JADC2”) efforts.

• Enterprise Networks and Internet of Things (“IoT”):

Satellite services are increasingly used for Machine-to-Machine data connectivity for both critical infrastructure applications such as utility companies (electrical grid, oil rigs, gas pipelines, water companies) as well as IoT networks.

Comtech TDMA equipment is widely used in these applications, where it delivers superior network availability (by making use of geographical hub redundancy and other technologies), and high Quality of Service (“QoS”).

Terrestrial and Wireless Networks Segment

Our Terrestrial and Wireless Networks segment is a leading provider of the hardware, software, and solutions critical to any modern 911 public safety and mobile network operator (“MNO”) infrastructure, as well as for applications services requiring the specific location of a mobile user's geospatial position.

From the moment a 911 call is made, Comtech provides highly reliable solutions that contribute to emergency calls being processed instantly, with proper routing to first responders.

Our solutions include feature-rich data sets (such as:

precise location information, route optimization, text messaging, photos and real-time video), putting first responders in the best possible position to make decisions when every second counts.

Our customers are the businesses, communities and governments that need to implement and improve 911 infrastructure in the U.S., as well as MNOs in the U.S.

and abroad that have a need to determine subscriber location within a network or to facilitate messaging services.

In 2021, we were recognized by Frost & Sullivan, a leading third-party research firm, for registering the most significant year-over-year market share increase among all NG-911 primary contract holders.

As such, we believe that we are a leader in public safety communication and location technologies.

The Terrestrial and Wireless Networks segment is organized into four product areas:

Next Generation 911 & Call Delivery, Solacom Call Handling Solutions, Trusted Location and Messaging Solutions, and Cyber Security Training & Services.

Next Generation 911 & Call Delivery

In addition to 911 call routing, we provide systems integration, geospatial location information, satellite and location infrastructure terminals, and linkage to NG-911 Emergency Services IP Networks ("ESInet").

We also offer what we believe are best-in-class 911 call handling solutions under the Solacom brand name.

We believe state and local governments need to upgrade existing legacy networks, location technologies, and call handling systems to modern NG-911 systems infrastructure, including 911 text messaging services, advanced data, real-time photos, and other types of information sharing over IP networks.

and Canada broadly adopt upgraded NG-911 and call handling solutions, we believe that other countries will follow similar technology and telecommunications advancements.

Comtech’s public safety and location technology solutions have been deployed since 2006 and are utilized by domestic MNOs, as well as internationally, to provide reliable device location determination for public safety and commercial applications.

Many of our technologies, such as positioning, mapping, and text messaging, are embedded in our public safety and location offerings to help address mapping, routing, and geolocations.

Our solutions address Federal Communications Commission ("FCC") mandates for emergency services as they relate to location delivery by supporting precise caller location.

Our text messaging platforms are used by wireless carriers to provide short messaging services (“SMS”) to their end-customers as well as being used to communicate with 911 public safety answering points (“PSAPs”).

Solacom Call Handling Solutions

We offer what we believe is a best-in-class call handling solution marketed under the Solacom Guardian brand name, which provides an integrated text-to-and-from 911 solution on a unified platform.

The solution provides a flexible user interface, adapts to varying customer environments and preferences, provides powerful call conferencing capabilities, enhanced reporting capabilities and offers geospatial 911 location call display directly from a customized map.

Because of its advanced features, it allows us to offer an immediate upgrade path to existing and new customers and has expanded our presence in the public safety solutions market.

We are investing in product enhancements of the Guardian software, including developing a cloud-based version so that we can offer software as a service ("SaaS") type solutions to our public safety customers.

Our Compact Over-the-horizon Mobile Expeditionary Terminal (“COMET TM ”) – We offer the Comtech COMET TM , the world’s smallest OTH microwave troposcatter terminal.

Our Comtech COMET TM is rapidly deployable, low power and highly portable.

Troposcatter technology has long been associated with large antennas and high-power amplifiers that require kilowatts of prime power and large trucks to transport them to the field.

The COMET TM has fundamentally changed this paradigm.

The COMET TM is capable of being transported in a carrying case by a single individual and set up in under fifteen minutes.

The COMET TM is ideally suited for situations where high bandwidth backhaul communications are required, extending critical services into areas where there is no communications infrastructure, or the infrastructure has been destroyed.

Special Forces, as well as non-U.S.

NATO forces, have already begun procuring and deploying the COMET TM for high reliability, mission essential communications.

Our "XyPoint ® " Mobile Location Platform – Provided to MNOs globally, our virtualized LBS platform is a high availability robust solution with multiple positioning technologies, that allows authorized users to locate and track specific mobile devices and monitor specific areas of interest.

Because of its advanced features, it allows us to offer an immediate upgrade path to existing and new customers and has expanded our presence in the public safety solutions market with more than 700 PSAPs and emergency call centers installed in 5 countries.

The Guardian platform includes an integrated cloud-based texting solution (“Guardian Messenger”) which provides call takers / dispatchers with the ability to collect, process and share previously unavailable live incident information such as text, photos, and video via SMS and multimedia messaging services (“MMS”), from one integrated desktop.

The Guardian platform also offers a cloud-based reporting and analytics solution (“Guardian Insights”), designed to assist emergency call center directors to know their operations, so they can better plan and manage resources and workloads.

We are investing in product enhancements for our Guardian platform including additional cloud-based capabilities, analytics, and cyber security solutions.

We have significantly increased our “911-as-a-Service" (“911aaS”) offering, deploying hosted 911 call centers solutions across numerous states and regions in the U.S.

and provinces in Canada.

Trusted Location and Messaging Solutions

We believe that as the industry moves toward digital transformation, customers will be looking for situational awareness solutions that are built on top of mapping and geo-services.

Our location technology solutions enable the determination of a mobile phone's geospatial position in a variety of environments, leveraging a wide range of signals including Global Positioning System ("GPS"), Global Navigation Satellite Systems ("GNSS") and multiple cellular positioning technologies ranging from 2G through 5G mobile networks.

For our installed base of systems, we provide ongoing operational support, including administration of system components, system optimization, configuration management and maintenance services, including tracking customer support issues, troubleshooting, and developing and installing maintenance releases.

Our Location Studio TM platform enables customers, particularly public safety agencies, to build their own applications with end-user functionality, such as maps, search, geocoding, routing, and navigation, using their own brand.

We believe that customers and prospects are increasingly looking for alternatives to mapping services that are subject to change by the provider, and which meet market privacy and security requirements.

The Location Studio TM platform is a complete end-to-end location application consisting of maps, map data, including our Trusted OpenStreetMap ("TOSM") geo-services, application program interfaces ("APIs") and software development kits ("SDKs") enabling public safety ecosystems and enterprises to customize unique mapping applications.

Map data includes positioning, search, enhanced local content, custom maps, navigation, geo-fencing, tracking integrated with third party data sources like camera feeds and IoT sensor data via cross-platform APIs and SDKs supporting all leading operating systems.

In fiscal 2022, we began marketing SmartResponse TM , a newly developed cloud-based solution that offers a common operational picture to PSAPs and first responders, enabling an effective data-driven response for security agencies and first responders by providing a holistic information environment for them.

This new solution offers streaming live feeds from traffic cameras at and near incident location, and accesses caller information like past residences, criminal history, or next-of-kin information at the tap of a button.

Offering a bird's-eye view of integrated data, the SmartResponse TM solution empowers first responders to ensure appropriate resources are on the scene and to better serve the public in emergency situations.

Cyber Security Training & Services

During the first quarter of fiscal 2022, Comtech launched a new cybersecurity brand, CyberStronger™, to provide cybersecurity solutions and services tailored to threat monitoring and assessment, training, and workforce development.

Offerings include cyber threat detection and management, off-the-shelf and custom training, hands-on skills labs, and competency-based assessments mapped to cybersecurity job roles.

The CyberStronger™ solutions also include the CYBRScore® set of products that provide hands-on assessments and training to upskill and reskill cybersecurity workforces.

These solutions were created by a team of former national intelligence community members who have the practical cybersecurity experience and abilities required to meet the demanding needs of Comtech’s customer base which includes government entities, large universities, and enterprise-level corporations.

Our offerings are suitable for both technical and non-technical teams to close the skills gap in the cyber security field and also provide continuous feedback and evidence to the organizations about their teams’ proficiency.

Our PerformanScore® is a performance-based scoring platform that uniquely and adaptively measures skills across a range of credible responses to a defined set of tasks, allowing for a consistent and immediate evaluation.

Terrestrial and Wireless Networks:

Key Markets and Growth Drivers

We are a leading provider of modern public safety and location technologies.

Our next generation solutions enable rich, multimedia information to be delivered alongside 911 calls.

Also, our E911 and NG-911 call routing solutions allow cellular carriers and voice over the Internet ("VoIP") carriers, as well as legacy telecommunications carriers, to deliver emergency calls to public safety emergency call centers nationwide.

When someone places an emergency call, our technologies identify the call as an emergency call, access the user’s location information from the wireless or VoIP networks and location databases, and route the call to the assigned public safety jurisdiction.

Today, we provide public safety and location technologies to many U.S.

telecommunication carriers, the largest being Verizon (for which we provide 911 call routing via cellular service).

We believe we service a significant portion of the carrier market for 911 cellular call routing applications, along with one other leading competitor.

With the advent of 5G networks, new network-based positioning technologies are poised to deliver opportunities thanks to the ongoing digital transformation of multiple industry verticals, including the Public Safety, Transportation, Manufacturing, Healthcare and Retail industries.

As these industries increasingly rely on data from connected devices, using location information in real-time is expected to enhance existing business processes and outcomes as well as end user experiences.

We believe end-market applications such as worker’s safety in high-risk areas, smart manufacturing, and autonomous driving would benefit enormously from new precision-positioning techniques.

Also, MNOs can now provide even more advanced location-based services, in addition to existing connectivity solutions.

Examples of end-market applications that are driving long-term demand for our Terrestrial and Wireless Networks technologies include:

• Our XyPoint® Mobile Location Platform:

Provided to MNOs globally, our virtualized location-based services (“LBS”) platform is a high availability robust solution with multiple positioning technologies, that allows authorized users to locate and track specific mobile devices and monitor specific areas of interest.

MNOs can use this platform for location accuracy to support a wide variety of use cases, including public safety, location intelligence, network optimization and big data analytics.

On the legacy front, our LBS platform is compatible within 2G through 4G wireless networks, as well as an enabler to the MNOs to seamlessly migrate to cloud native environments, as they start their migrations to 5G.

(4) We Have a Diverse Global Customer Base

We have established long-standing relationships with thousands of customers worldwide, including leading system and network suppliers in the global satellite (such as Intelsat S.A.

and SES S.A.), mobile cellular (such as Verizon Wireless), defense, broadcast and aerospace industries, as well as the U.S.

federal government (such as the U.S.

Army and Navy), U.S.

• Comtech INSIGHTS™ LightSource™:

Provides first responders a reporting and analytics platform for the rich data created in Comtech’s NG-911 core systems.

Authorized users at state, regional, and jurisdiction organizations can see reports and analysis of call, behavior, and location characteristics in both time and geospatial visualizations.

Users are able to interact directly with the visualization in real time to focus on desired characteristics to include timeframes, call types, media types, and other information.

Authorized users can also schedule reports for automatic delivery via email.

• Comtech INSIGHTS™ SmartResponse™:

Provides first responders of all types (fire, police, medical, state, regional emergency communications centers, dispatch centers, emergency management agencies, fusion cells, intelligence centers, etc.) access to real-time 911 call information and related supplemental information for situational awareness in a geospatial, mapped context.

Authorized users can view 911 calls and emergency response vehicles/assets in a 3-D map via a single pane of glass view to enhance response.

SmartResponse™ is available for use in both emergency centers and response vehicles.

• Wireless Emergency Alerts (“WEA”):

WEA, also known as Commercial Mobile Alerts System (“CMAS”) in the US, enable authorized officials to inform the public about life-threatening events by automatically delivering emergency alerts to mobile devices (including roaming users) via the government alert gateway.

Using standardized infrastructure, ensuring compliance with government regulations globally, our patented technology facilitates the origination and accurate delivery of geo-targeted emergency alerts, empowering emergency services providers to better serve the public.

Using this technology, for example, MNOs can quickly broadcast emergency communications, such as severe weather alerts, to all devices in a specific geographical area.

Opportunities in Convergence

We believe that significant advances in technology have been driving a convergence across multiple aspects of the Terrestrial and Wireless Networks market and the Satellite and Space Communications market.

We believe we have an advantage in having identified this convergence, and in combining our native expertise in both to develop innovative new products and solutions to meet growing customer demands.

Broadly, the increasing digitization of people and businesses, and the ongoing migration to the cloud, means a growing reliance on communications and connectivity, and a corresponding increase in the volumes of data transmission.

We believe this is a long-term secular opportunity for Comtech given our market-leading positions in, and understanding of, the fast-evolving Failsafe Communications markets.

We are watching in real-time as the once clear line separating terrestrial and non-terrestrial communications networks is dissolving.

The need for connectivity (more precisely:

constant, reliable connectivity) is growing on a worldwide basis.

People, devices, and machines need constant connectivity, regardless of whether they are proximate to a cellular tower.

Because of this, satellite communications are increasingly bridging gaps created by challenging geographies, or a lack of terrestrial infrastructure altogether.

Comtech is increasingly delivering solutions to companies and countries seeking to bridge these gaps, whether across legacy 4G networks, or through the introduction of 5G networks, as operators seek ways to optimize implementation, control costs, and mitigate security risks.

We expect the convergence of terrestrial and non-terrestrial networks to continue, leveraging the increasing numbers and density of satellite constellations to meet the growing terrestrial demand to connect and move more data, more quickly, reliably, and efficiently than ever.

Our Diverse Global Customer Base

We have established long-standing relationships with thousands of customers worldwide, including leading system and network suppliers in the global satellite, mobile cellular, defense, broadcast and aerospace industries, as well as the U.S.

federal government (including the U.S.

Army, Air Force, Marine Corps, and Navy), U.S.

state and local governments, and foreign governments.

Our global commercial and government customers are increasingly seeking integrated solutions to meet their operational needs.

Our global Satellite and Space Communications and Terrestrial and Wireless Networks customers are increasingly seeking integrated solutions to meet their operational needs.

We believe that our customers recognize our ability to develop improved technologies and to meet stringent program requirements.

Our ability to solve complex problems is well known and we believe we have strong relationships with our customers.

We hold prime positions on several key contracts and have had a long history of servicing key programs.

Business Segments

Fundamentally, we offer advanced secure wireless communications technologies with expertise in the satellite communications and cellular markets.

We believe these markets are undergoing a period of significant growth and rapid technological change.

We manage our business through two reportable operating segments:

Commercial Solutions and Government Solutions.

Our corporate senior management team supports the business segments by, among other things, actively seeking to exploit potential synergies that exist between the segments, including in areas such as manufacturing, technology, sales, marketing, customer support and finance.

The diagram below summarizes our key products, systems and services by our two reportable operating segments:

Commercial Solutions Segment Technologies

(approximately 61.9% of fiscal 2021 net sales) Government Solutions Segment Technologies

(approximately 38.1% of fiscal 2021 net sales)

Satellite Ground Station

Technologies Public Safety and Location

Technologies Tactical Communications

Technologies High-Performance Transmission

• Satellite ground station technologies such as SCPC modems, TDMA modems and networking platforms that facilitate the transmission of voice, video and data over satellite links including LEO and HTS satellite constellations

• Solid-state and traveling wave tube amplifiers used to amplify signals from satellite ground stations

• Wireless/VolP 911 service for network operators

• NextGen 911 solutions

• ESInet (Emergency Services IP Network)

• Call Handling applications for PSAPs

• Software and equipment for location-based and messaging services for various applications, including both public safety and commercial services

• Tactical satellite-based communications, field support and end-to-end integration

• Satellite-based mobile communications and tracking systems, including high precision full motion fixed and mobile X/Y satellite tracking antennas, RF feeds, reflectors and radomes

• Procurement and supply chain management of high reliability EEE parts for satellite, launch vehicle and manned space applications

• Over-the-horizon microwave equipment that can transmit digitized voice, video and data over distances up to 200 miles using the troposphere and diffraction, including the Comtech COMET TM

• Solid-state, RF microwave high-power amplifiers and control components designed for radar, electronic warfare, jamming, medical and aviation applications

Commercial Solutions Segment

Representative Customers Government Solutions Segment

A table illustrating representative customers is provided below.

Satellite and Space Communications Segment

Representative Customers Terrestrial and Wireless Networks Segment

Representative Customers

Satellite systems integrators, wireless and other communication service providers and broadcasters

Domestic and international defense customers, as well as U.S.

and foreign governments, prime contractors and system suppliers, such as General Dynamics Corporation, Lockheed Martin Corporation, L3Harris Technologies, Inc., Raytheon Technologies Corporation, SED Systems (a division of Calian Ltd.), and ViaSat Inc.

Satellite broadcasters, such as The DIRECTV Group and EchoStar Corporation

state and local governments, such as Arizona, the Commonwealth of Massachusetts, the Commonwealth of Pennsylvania, Iowa, Maine, South Carolina and the state of Washington

End-customers also include AT&T Inc., BT Group plc., China Mobile Limited, CenturyLink, Inc., Claro Argentina, Comcast Corporation, Intelsat S.A., Speedcast International Limited, Nokia Corporation, QUALCOMM Incorporated, SES S.A., T-Mobile USA, Inc.

and Verizon Communications Inc.

Satellite systems integrators, wireless and other communication service providers, and broadcasters, such as DIRECTTV Group and EchoStar Corporation

Army, the U.S.

2 unchanged sentences

Armed Forces, NATO and foreign governments (i.e., ministries of defense)

Domestic and international defense customers, prime contractors and system suppliers such as Lockheed Martin Corporation, L3 Harris Technologies, Inc., Northrop Grumman Corporation, Raytheon Technologies Corporation., SES S.A., and The Boeing Company

Medical equipment companies, such as Varian Medical Systems, Inc., and aviation industry system integrators such as Collins Aerospace (a subsidiary of Raytheon Technologies Corporation) and Telephonics Corporation

Foreign government customers in the Middle East, Europe, North Africa, Latin America and Asia Pacific and related prime contractors and systems integrators

Domestic and international defense customers, as well as prime contractors and system suppliers such as General Dynamics Corporation, Lockheed Martin Corporation, L3Harris Technologies, Inc., Northrop Grumman Corporation, Raytheon Technologies Corporation, Telephonics Corporation, The Boeing Company and ViaSat Inc.

Medical equipment companies, such as Varian Medical Systems, Inc., and aviation industry system integrators such as Collins Aerospace (a subsidiary of Raytheon Technologies Corporation)

End-customers also include BT Group plc., China Mobile Limited, Claro Argentina, Intelsat S.A., JAXA, NASA, QUALCOMM Incorporated, SED Systems (a division of Calian Ltd.), SES S.A.

and Speedcast International Limited

Oil companies such as Shell Oil Company and PETRONAS

Financial information about our business segments, including net sales, operating income, Adjusted EBITDA (a Non-GAAP financial measure), total assets, and our operations outside the United States, is provided in "Notes to Consolidated Financial Statements - Note (11) Segment Information" included in "Part II - Item 8.

- Financial Statements and Supplementary Data."

The markets and key technologies for each segment are further described below.

Commercial Solutions Segment

Our Commercial Solutions segment offers satellite ground station technologies (such as SCPC and TDMA modems and amplifiers) and public safety and location technologies (such as 911 call routing, 911 call handling and mapping solutions) to commercial customers and smaller government customers, such as state and local governments.

This segment also serves certain large government customers (including the U.S.

government) that have requirements for off-the-shelf commercial equipment.

Key Markets and Technology Solutions

Satellite Ground Station Technologies

We offer our customers one-stop-shopping for satellite ground station technologies, including SCPC and TDMA modems, amplifiers, frequency converters and network software for customers who utilize satellite communications.

Our Commercial Solutions segment manufactures most of the satellite ground station equipment we sell to our customers.

We believe that the overall satellite ground station equipment industry will grow over the next few years, and will be increasingly connected to existing and new cellular networks.

This growth is expected to occur as a result of widespread deployment and upgrades of 4G and 5G ground-based systems, including satellite earth stations, as well as the integration of high-performance amplifiers necessary to meet long-term demand for high-performance satellite communications applications, such as satellite-based wireless backhaul, DTH, HD and 4K broadcasting and in-flight connectivity.

We believe that Comtech is well positioned to capitalize on this demand through sales of our market leading satellite ground station technologies, including new next-generation satellite earth station technologies that can be used with the thousands of new LEO, MEO and large HTS satellite constellations that are reportedly being launched over the next several years.

Examples of end-market applications that are driving long-term demand for our satellite-based communication technologies include:

• Satellite-Based Cellular Backhaul.

Ultimately, as 5G services continue to be deployed, mobile data services will become more critical.

As mobile data penetration expands and mobile data consumption increases, wireless carriers must invest in their mobile network infrastructure and businesses will require back-up communications.

In developing regions of the world and in remote areas where terrestrial network infrastructure is lacking, wireless network operators often backhaul, or transport, their wireless data traffic using satellite-based networking technologies.

• New LEO, MEO and HTS Satellites.

There are thousands of new satellites reportedly being launched over the next several years, which believe will lead to increasingly complex satellite networks.

As service providers work to offer connectivity to these high-speed, high-bandwidth satellites and expand their networks to handle the demand for new LEO, MEO and HTS applications, we believe our Heights TM and UHP networking platforms, our solid-state amplifiers and our X/Y antennas will ultimately be incorporated into many new installations and necessary upgrades of equipment.

• High Definition and Ultra-High Definition Transmission.

Reports indicate that in recent years, consumers have purchased millions of HD televisions and Ultra-High Definition or "4K" televisions and streaming high-definition videos over mobile devices.

We believe this will require a significant amount of satellite bandwidth, which will require satellite service providers to upgrade equipment and find new ways to manage the cost and transmission efficiency of their networks.

We believe that these requirements will drive increased demand for our satellite ground station technologies.

• Integration of Satellite Systems into 911 Systems.

911 service is a vital part of the U.S.

government's nationwide emergency response and disaster preparedness system.

In recent years, the FCC has taken steps to increase public safety by encouraging and coordinating development of a nationwide, seamless communication system for emergency systems.

Increasingly, satellite services are playing a more important role in the nationwide 911 network not only in rural areas but as back-up for Public Safety Answering Points ("PSAP") and individual callers.

For instance, in August 2021, it was reported that Apple was developing satellite capabilities for its iPhone models that would allow users to call and/or send texts in emergency situations.

We believe that satellite systems, supported by our SCPC and TDMA networking platforms, will be incorporated into 911 systems.

Given our expertise in public safety and location technology solutions, we believe we are uniquely positioned to be a leader in this growing market.

Public Safety and Location Technologies

We are a leading provider of public safety and location technologies.

Our next generation solutions enable rich, multimedia information to be delivered with 911 calls;

our E911 call routing solutions allow cellular carriers and voice over the Internet ("VoIP") carriers to deliver emergency calls to Public Safety emergency call centers nationwide.

When someone places an emergency call, our technologies can identify the call as an emergency call, access the user’s location information from the wireless network and route the call to the assigned public safety jurisdiction.

Today, we provide public safety and location technologies to many U.S.

telecommunication carriers, the largest being Verizon for which we provide their 911 call routing via cellular service.

We believe we service a significant portion of the carrier market for 911 cellular call routing applications, along with another leading competitor.

In addition to 911 call routing, we provide systems integration, satellite and location infrastructure terminals, and linkage to NG-911 Emergency Services IP Networks ("ESInet").

We also offer best-in-class 911 call handling solutions under the Solacom brand name.

We believe state and local governments have a need to upgrade existing call handling systems and old networks to more modern NG-911 systems, including 911 text messaging services, advanced data, real-time photos and other types of information sharing over IP networks.

adopts upgraded call handling and NG-911 solutions, we believe that other countries will do so as well.

Our public safety and location technology solutions have been deployed since 2006 and are utilized by domestic MNOs as well as internationally to provide reliable device location determination for public safety and commercial applications.

Many of our technologies, such as positioning, mapping and text messaging, are embedded in our public safety and location offerings to help address mapping, routing and geolocations.

We address the FCC mandates for emergency services as it relates to location by supporting precise location in our solutions.

Our text messaging platforms are used by wireless carriers to provide SMS to their end-customers and are also used to communicate with 911 PSAPs through major network operators.

In order to maximize market growth opportunities, we have repositioned certain of our location technology solutions to increase our penetration into the public safety space and are focusing on international markets.

As satellite services play a more important role in the nationwide 911 network, we believe demand for our location products will grow.

Our Location Studio TM platform enables customers, especially public safety agencies, to build their own applications with end-user functionality, such as maps, search, geocoding, routing and navigation, using their own brand.

We believe that customers and prospects are increasingly looking for alternatives to mapping services that are subject to change by the provider and which meet market privacy and security requirements.

Map data includes positioning, search, enhanced local content, custom maps, navigation, geo-fencing, tracking integrated with third party data sources like camera feeds and Internet of Things ("IoT") sensor data via cross-platform APIs and SDKs supporting all leading operating systems.

We believe that as the industry moves toward digital transformation, customers will be looking for situational awareness solutions that are built on top of mapping and geo-services.

For our installed base of systems, we provide ongoing operational support, including administration of system components, system optimization, configuration management and maintenance services, including tracking customer support issues, troubleshooting and developing and installing maintenance releases.

In fiscal 2022, we have begun marketing Smart Response TM , a newly developed cloud-based solution, that offers a common operational picture to first responders for an effective data-driven response for security agencies and first responders.

This new solution can offer streaming live feeds from traffic cameras at and near incident location, access caller information like past residences, criminal history, or next-of-kin information at the tap of a button.

Offering a bird-eye view of integrated data, the Smart Response TM solution empowers PSAP employees to ensure the appropriate resources are on the scene and to better serve the public in emergency situations.

Government Solutions Segment

Our Government Solutions segment provides tactical satellite-based networks and ongoing support for complicated communications networks, troposcatter systems and solid-state, high-power amplifiers to large government end-users (including those of foreign countries), large international customers and domestic prime contractors.

Key Markets and Technology Solutions

Tactical Communications Technologies

In response to this demand, we offer a variety of mission-critical technologies, including the supply and field support of tactical satellite-based networks (including satellite modems, ruggedized routers and solid-state drives), sustainment services for the AN/TSC-198A SNAP (SIPR and NIPR Access Point) VSATs.

Many of our mission-critical technologies are part of integrated communication infrastructure systems such as the U.S.

Military Command, Control, Communications, Computers, Cyber Intelligence, Surveillance and Reconnaissance (also known as "C5ISR") systems and similar complicated networks for international governments.

We also provide a variety of in-class and on-line training services, labs and assessments to our customers to help them protect networks from cyber attacks.

We are recognized as an industry leader and global supplier of high reliability products.

Our solutions include supply chain management and engineering services for high reliability EEE space parts and satellite and launch vehicle tracking solutions in support of critical National Aeronautics and Space Administration ("NASA") programs and for international space and defense agencies.

Through our acquisition of CGC Technology Limited, we are also a leading, world-wide provider of high precision, full motion fixed and mobile X/Y satellite tracking antennas, reflectors, RF feeds, radomes and other ground station equipment.

High-Performance Transmission Technologies

We offer several unique high-performance transmission technologies that are used in sophisticated communication systems, such as electronic warfare, radar and identification friend or foe ("IFF").

As our customers push the envelope for mobility, speed and higher frequency, we believe that demand for high-performance transmission products will grow from current levels.

Our troposcatter technologies (sometimes referred to as over-the-horizon or "OTH" microwave systems) are extremely reliable and secure and are a cost-effective alternative or compliment to satellite communication as it does not require the leasing of expensive satellite transponder space with its attendant recurring costs.

Our over-the-horizon microwave systems, which include our patented forward error correction technology, can transmit video and other broadband applications at throughputs of up to 200 Mbps.

and foreign governments use our over-the-horizon microwave systems to, among other things, transmit radar tracking, run C4ISR applications and connect to remote border locations.

Additionally, energy companies use our systems to enable communication links for offshore oil rigs and other remote locations, as well as for exploration activities.

Our MTTS, the first truly modular, rapidly deployable transit case-based troposcatter system, has been purchased by the U.S.

Army, incorporated into the SNAP family of products used by the U.S.

military and designated the Tactical Transportable TROPO ("SNAP 3T") or AN/TRC 198(V3).

We also recently introduced the Comtech COMET TM , a rapidly deployable OTH microwave system.

The Comtech COMET TM has a medium range (up to 60 km) and high bandwidth (up to 210 Mbps) that fills a void in distances that have long been desired by tactical communications planners.

The Comtech COMET TM uniquely addresses the special operations command (or “SOCOM”) community’s concern of low probability of intercept and low probability of detection (“LPI/LPD”), while providing high reliability, mission essential communications.

Our solid-state, high-power RF microwave amplifiers and related switching control technologies are utilized in several critical applications, including electronic warfare, communications, radar, IFF and medical applications such as oncology cancer treatment systems.

Our solutions increase the flexibility of systems by providing wider bandwidth capabilities to address communication needs.

We also believe that the desire for increased situational awareness of the airspace may create increased opportunities for our radar and IFF products, which are used by government and commercial customers around the world.

Our high power and highly reliable Gallium Nitride ("GaN") amplifier technology is increasingly used both to update existing radar systems for improved sensitivity and range as well as for new radar installations.

In order to position ourselves to take advantage of additional growth opportunities and meet our strategic objectives, we have followed, and will continue to follow, a disciplined approach in identifying, executing and capitalizing on acquisitions.

Completed Acquisitions

In the past several years, we have acquired businesses and enabling technologies.

On February 23, 2016, we acquired TeleCommunication Systems Inc.

("TCS"), a leading provider of commercial solutions (such as public safety and location technologies) and government solutions (such as tactical communications technologies).

The TCS acquisition had an aggregate purchase price for accounting purposes of $340.4 million (also referred to as the transaction equity value) and an enterprise value of $423.6 million.

The TCS acquisition, which has been fully integrated into our business, resulted in Comtech entering complementary markets and expanding our domestic and international commercial offerings.

On February 28, 2019, we completed our acquisition of Solacom, a leading provider of NG-911 solutions for public safety agencies.

The acquisition of Solacom was a significant step in our strategy of enhancing our public safety and location technologies.

The Solacom acquisition had an aggregate purchase price for accounting purposes of $32.9 million and was fully integrated into our Commercial Solutions segment.

On April 29, 2019, we acquired the state and local government NG-911 business from General Dynamics Information Technology, Inc.

(the "GD NG-911 business") and at the same time announced a five-year contract award in excess of $100.0 million to develop, implement and operate a NG-911 emergency communications system for a Northeastern state.

The acquisition strengthened our position in the growing NG-911 solutions market.

The GD NG-911 business had an aggregate purchase price for accounting purposes of $11.0 million and was fully integrated into our Commercial Solutions segment.

state and local governments, such as the Commonwealth of Massachusetts, the Commonwealth of Pennsylvania and the states of Arizona, Iowa, Maine, New Hampshire, South Carolina, Vermont and Washington

End-customers also include AT&T Inc., Lumen Technologies, Inc.

(formerly CenturyLink, Inc.), Comcast Corporation, Nokia Corporation, T-Mobile USA, Inc.

and Verizon Communications Inc.

Different solutions deployed with telephone companies and federal, provincial, and local governments in Australia, Canada, Cayman Islands and New Zealand

Business Results and Challenges:

In fiscal 2022, we achieved consolidated net sales of $486.2 million and Adjusted EBITDA of $39.3 million.

As more fully described elsewhere in this Form 10-K, we navigated the challenges of operating our global business during the period where COVID-19 continues to impact many of our customers and suppliers.

Like businesses everywhere, we confront one of the most difficult operating environments in memory, as the global economy struggles to find its footing amidst a pandemic, geopolitical conflict, surging inflationary pressures, changes in government spending priorities, and adverse supply chain disruptions.

Nevertheless, in fiscal 2022, we continued to strengthen the Comtech brand and its positioning within the key markets that we serve.

We believe that as COVID-19 subsides and the global economy recovers, our business performance in future periods will improve from current levels.

Our Business Outlook for Fiscal 2023 is discussed further in Part II – “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations – Business Outlook for Fiscal 2023 .” For a definition and explanation of Adjusted EBITDA, see Part II – “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations – Comparison of Fiscal 2022 and 2021 – Adjusted EBITDA .”

More Information and Where to Find It

Our Internet website is www.comtech.com , at which you can find our filings with the Securities and Exchange Commission ("SEC"), including investor letters, press releases, annual reports, quarterly reports, current reports, and any amendments to those filings.

We also make announcements regarding company developments and financial and operating performance through our blog, Signals, at www.comtech.com/comtech-signals .

We also use our website to disseminate other material information to our investors (on the Home Page and in the "Investor Relations" section).

We also use social media channels to communicate with customers and the public about our Company, our products, services, and other issues, and we use social media and the Internet to communicate with investors, including information about our stockholder meetings.

Information and updates about our Annual Meetings will continue to be posted on our website at www.comtech.com in the "Investor Relations" section.

None of the information on our website, blog or any other website identified herein is incorporated by reference in this annual report and such information should not be considered a part of this annual report.

Material acquisitions in the past several years include:

On January 27, 2020, we completed the acquisition of CGC Technology Limited ("CGC"), a small privately held company located in the United Kingdom.

CGC is a leading provider of high precision full motion fixed and mobile X/Y satellite tracking antennas, reflectors, RF feeds, radomes and other ground station equipment around the world.

CGC is a leading provider of high-precision full-motion fixed and mobile X/Y satellite tracking antennas, reflectors, RF feeds, radomes and other ground station equipment for customers around the world.

The acquisition brought established relationships with several top-tier European aerospace companies and other government entities, and we expect it to allow us to participate in the anticipated growth in the number of LEO and MEO satellite constellations.

The CGC business had an aggregate purchase price for accounting purposes of $23.7 million and was fully integrated into our Government Solutions segment.

On February 21, 2020, we acquired NG-911, Inc.

("NG-911"), a small privately held company based in Iowa, Illinois and Missouri.

NG-911 is a pioneer in providing next generation 911 solutions, including those designed by Solacom, to public safety agencies in the Midwest.

The acquisition allows us to cost-effectively expand sales of our industry leading Solacom Guardian call management solutions for public safety.

The NG-911 product line had an aggregate purchase price for accounting purposes of $1.2 million and was fully integrated into our Commercial Solutions segment.

The aggregate purchase price for accounting purposes for the acquisition of CGC was $23.7 million and CGC was fully integrated into our Satellite and Space Communications segment.

On March 2, 2021, we completed our acquisition of UHP Networks Inc.

("UHP"), a leading provider of innovative and disruptive satellite ground station technology solutions.

With end-markets for high-speed satellite-based network anticipated to significantly grow, our acquisition allows us to enhance our Commercial Solutions segment's offerings with low cost TDMA satellite modems.

The UHP business has a preliminary purchase price for accounting purposes of $37.5 million and was fully integrated into our Commercial Solutions segment.

With end-markets for high-speed satellite-based networks anticipated to significantly grow, our acquisition allows us to enhance our offerings with TDMA satellite modems.

The aggregate purchase price for accounting purposes for the acquisition of UHP was $37.5 million and UHP was fully integrated into our Satellite and Space Communications segment.

Sales, Marketing and Customer Support

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We devote resources to evaluating and responding to requests for proposals by governmental agencies around the world and, as needed, we employ the use of specialized consultants to develop our proposals and bids.

We intend to continue to expand international marketing efforts by engaging additional independent sales representatives, distributors and value-added resellers and by establishing additional foreign sales offices.

In addition, we also leverage our relationships with larger companies (such as prime contractors to the U.S.

In addition, we expect to leverage our relationships with larger companies (such as prime contractors to the U.S.

government and large mobile wireless operators) to market our technology solutions.

In fiscal 2022, we expect to significantly expand our social media and Internet presence and develop an updated marketing and branding strategy.

In fiscal 2023, we expect to continue expanding our social media and Internet presence and developing an updated marketing and branding strategy.

We are pre-qualified as an approved vendor for certain government contracts.

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2022 2021 2020 2022 2021 2020 2022 2021 2020

Commercial Solutions Government Solutions Consolidated

Satellite and Space Communications Terrestrial and Wireless Networks Consolidated

government 45.6 % 52.8 % 53.7 % 2.4 % 1.4 % 1.2 % 27.2 % 34.6 % 36.2 %

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Sales to U.S.

government customers include sales to the DoD, intelligence and civilian agencies, as well as sales directly to or through prime contractors.

government customers include sales to the U.S.

Department of Defense ("DoD"), intelligence and civilian agencies, as well as sales directly to or through prime contractors.

Domestic sales include sales to commercial customers, as well as to U.S.

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Included in domestic sales are sales to Verizon Communications Inc.

("Verizon"), which represented 10.7% of consolidated net sales for fiscal 2021.

("Verizon"), which represented 11.1% and 10.7% of consolidated net sales for fiscal 2022 and 2021, respectively.

Except for the U.S.

government, there were no customers that represented more than 10.0% of consolidated net sales during fiscal 2020 and 2019.

government, there were no customers that represented more than 10.0% of consolidated net sales during fiscal 2020.

International sales for fiscal 2022, 2021 and 2020 (which include sales to U.S.

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domestic companies for inclusion in products that are sold to a foreign country) represented more than 10% of consolidated net sales for fiscal 2022, 2021 and 2020.

Our backlog as of July 31, 2021 was $658.9 million (of which $526.4 million was attributed to the Commercial Solutions segment and $132.5 million was attributed to the Government Solutions segment).

Our backlog as of July 31, 2022 was $618.1 million (of which $192.4 million was attributed to the Satellite and Space Communications segment and $425.7 million was attributed to the Terrestrial and Wireless Networks segment).

We estimate that a substantial portion of the backlog as of July 31, 2022 will be recognized as sales during the next twenty-four month period, with the rest thereafter.

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In some cases, such as contracts received from large U.S.

based telecommunication companies, our backlog is computed by multiplying the most recent month’s contract or revenue by the months remaining under the existing long-term agreements, which we consider to be the best available information for anticipating revenue under those agreements.

based telecommunication companies, our backlog may include the value of customer authorizations to proceed or may be computed by multiplying the most recent month’s contract or revenue by the months remaining under the existing long-term agreements, which we consider to be the best available information for anticipating revenue under those agreements.

When we acquire a company with existing contracts, we only record bookings for those contracts that meet our definition.

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government) are subject to modification, cancellation at the convenience of the customer, or for default in the event that we are unable to perform under the contract.

Please see Item 1A – “ Risk Factors ” under Part I of this Form 10-K for more information about risks pertaining to recognition of our backlog.

A significant portion of the backlog from our U.S.

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In addition to adjustments from these types of contingencies, variations in backlog from time to time are attributable, in part, to changes in sales mix, the timing of contract proposals, the timing of contract awards, delivery schedules on specific contracts and new bookings obtained through acquisitions.

A large majority of the solutions in our satellite ground station technologies product line operate under short lead times.

Our Government Solutions segment backlog is highly influenced by the nature and timing of orders received from the U.S.

government, which is subject to unpredictable funding, deployment and technology decisions.

A large majority of the solutions in our satellite ground station technologies product line within our Satellite and Space Communications segment operate under short lead times.

Backlog in both our Satellite and Space Communications segment and Terrestrial and Wireless Networks segment and has been, and could be, highly influenced by the nature and timing of orders received from federal, state and local governments and defense-related agencies, causing such orders to be subject to unpredictable funding, deployment and technology decisions by such customers.

As a result, we believe our backlog and orders, at any point in time, are not necessarily indicative of the total sales anticipated for any future period.

Manufacturing and Service

Our manufacturing operations consist principally of the assembly and testing of electronic products that we design and build from purchased fabricated parts, printed circuits and electronic components.

We consider our facilities to be well maintained and adequate for current and planned production requirements.

All our manufacturing facilities, including those that serve the military market, must comply with stringent customer specifications.

We employ formal quality management programs and other training programs, including the International Standard Organization’s quality procedure registration programs.

To support our long-term business goals, in fiscal 2021, we commenced a 15-year lease for a new 146,000 square foot facility in Chandler, Arizona and began shifting production of our satellite earth station products from our existing Tempe, Arizona locations.

We also signed a new 10-year lease in the United Kingdom to expand our Government Solutions segment's manufacturing capabilities.

This facility is expected to support the production of X/Y satellite tracking antennas that can be used in connection with the thousands of new LEO, MEO and large HTS satellite constellations reportedly being launched over the next several years.

COVID-19 has delayed efforts to get our new technology manufacturing centers operational and has increased our start-up costs.

Although things can be further delayed, we anticipate that our new facilities will be operational by the end of our fiscal 2022 or early part of fiscal 2023.

Increased usage of our high-volume technology manufacturing centers will allow us to secure volume discounts on key components, better control the quality of our manufacturing process and maximize the utilization of our manufacturing capacity.

All of our other manufacturing facilities are located in the United States.

Our ability to deliver products to customers on a timely basis is dependent, in part, upon the availability and timely delivery by subcontractors and suppliers (including, at times, the U.S.

government) of the components and subsystems that we use in manufacturing our products.

Electronic components and raw materials used in our products are generally obtained from independent suppliers.

Some components are standard items and are available from several suppliers.

Others are manufactured to our specifications by subcontractors.

Although we obtain certain components and subsystems from a single source or a limited number of sources, we believe that most components and equipment are available from multiple sources.

government contracts may require us to incorporate government furnished parts into our products.

Delays in receipt of such parts can adversely impact the timing of our performance on the related contracts.

While not individually material, during fiscal 2021, as a result of COVID-19, we have experienced longer lead times for certain components and raw materials from certain suppliers as well as higher freight costs due to an overwhelmed global transport network.

We expect that these supply chain issues will ease during the second half of fiscal 2022.

Research and Development

We have established a leading technology position in our fields through internal and customer-funded research and development activities.

We have established leading technology positions in our fields through internal and customer-funded research and development activities.

Internal research and development expenses are reported as research and development expenses for financial reporting purposes and were $52.5 million, $49.1 million and $52.2 million in fiscal 2022, 2021 and 2020, respectively, representing 10.8%, 8.4% and 8.5% of total consolidated net sales, respectively, for these periods.

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During fiscal 2022, 2021 and 2020, we were reimbursed by customers for such activities in the amounts of $9.8 million, $13.6 million and $11.9 million, respectively.

During fiscal 2021, we incurred $0.3 million of strategic emerging technology costs for next-generation satellite technology to advance our solutions offerings to be used with new broadband satellite constellations.

We are evaluating this new market in relation to our long-term business strategies, and we may incur additional costs in fiscal 2022.

During fiscal 2022 and 2021, we incurred $1.2 million and $0.3 million, respectively, of strategic emerging technology costs for next-generation satellite technology to advance our solutions offerings to be used with new broadband satellite constellations.

We are evaluating this new market in relation to our long-term business strategies, and likely to incur additional costs in fiscal 2023.

Intellectual Property

We rely upon trade secrets, technical know-how, continuing technological innovation and, with respect to certain technologies, patents to develop and maintain our competitive position.

We rely upon trade secrets, technical know-how, continuing technological innovation and, with respect to certain key technologies, patents to develop and maintain our competitive position.

The products we sell require significant engineering design and manufacturing expertise.

For technological capabilities that are not protected by patents or licenses, we generally rely on the expertise of our employees and our learned experiences in both the design and manufacture of our products and the delivery of our services.

Some of our key Commercial Solutions segment technology is protected by patents that are significant to protecting our proprietary technology.

Some of our key Satellite and Space Communications segment technology is protected by patents that are significant to protecting our proprietary technology.

We have been issued several U.S.

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We do not believe that any single patent or group of patents, patent application or patent license agreement is material to our operations.

We have filed additional patent applications for certain apparatus and processes we believe we have invented covering key features of the location services, wireless text alerts, SMS Center, mobile-originated data and E911 network software.

We have filed additional patent applications for certain apparatus and processes we believe we have invented covering key features of location services, wireless text alerts, SMS Center, mobile-originated data and E911 network software.

There is no assurance that any patent application will result in a patent being issued by the U.S.

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Listed below, in alphabetical order, are some of our competitors in each of our two business segments:

Commercial Solutions - ACTIA Group, Advantech Co., Ltd., Agilis Satcom, AnaCom, Inc., Bandwidth.com, CalAmp Corp., Codan Limited, CPI International, Inc., Datum Systems, Inc., dB Control Corp.

(a subsidiary of HEICO Corp.), 8x8, Inc., ENENSYS Technologies, ETM, Inc., Gilat Satellite Networks Ltd., Google Inc.

(a subsidiary of Alphabet Inc.), Here Technologies, Honeywell Aerospace (a subsidiary of Honeywell International Inc.), Infinite Convergence Solutions, Inc., Intermap Technologies Corporation, Intrado Corporation, Iridium Communications Inc., ITS Electronics Inc., KVH Industries Inc., LM Ericsson Telephone Company, L3Harris Technologies, Inc., Mission Microwave Technologies, LLC., Motorola Solutions, Inc., ND Satcom GmbH, Nokia Networks (a subsidiary of Nokia Corporation), NOVELSAT, Novra Technologies Inc., Orbcomm Inc., Panasonic Corporation, Paradise Datacom Ltd.

(a subsidiary of Teledyne Technologies Incorporated), Polarity Inc., SatixFy Israel Ltd., SatPath Systems, Inc., Spacepath Communications Limited, Speedcast International Limited, ST Engineering iDirect, Inc.

(including Newtec), Telenav, Inc., Terrasat Communications Inc, TMD Technologies LLC., TomTom N.V.

and ViaSat, Inc.

Government Solutions - Aethercomm Inc., AMERGINT Technologies, Inc., CACI International Inc., CalAmp Corp., CPI International, Inc., Cubic Corporation, dB Control Corp.

(a subsidiary of HEICO Corp.), DXC Technology, Empower RF Systems, Inc., Envistacom, LLC, Escape Communications, Inc., General Dynamics Corporation, International Datacasting Corporation (a subsidiary of Novra Technologies Inc.), Kratos Defense & Security Solutions, Inc., L3Harris Technologies, Inc., Mercury Systems, Inc., NeuStar, Inc., Northrop Grumman Corporation (including the former Orbital ATK, Inc.), Raytheon Technologies Corporation, Teledyne Technologies Incorporated, The KeyW Holding Corporation, Ultra Electronics Holdings plc.

and ViaSat, Inc.

Satellite and Space Communications – ACTIA Group, Advantech Co., Ltd., Aethercomm Inc., Agilis Satcom, AMERGINT Technologies, Inc., AnaCom, Inc., Codan Limited, CPI International, Inc., Datum Systems, Inc., dB Control Corp.

(a subsidiary of HEICO Corp.), ENENSYS Technologies, ETM Electromatic Inc., Gilat Satellite Networks Ltd., Empower RF Systems, Inc., Envistacom, LLC, General Dynamics Corporation, Hughes Network Systems, LLC (a subsidiary of EchoStar), KVH Industries, Inc., L3Harris Technologies, Inc., Mission Microwave Technologies, LLC, ND Satcom GmbH, Panasonic Corporation, Paradise Datacom Ltd.

(a subsidiary of Teledyne Technologies Incorporated), Raytheon Technologies Corporation, SatixFy Israel Ltd., ST Engineering iDirect, Inc.

(including Newtec), Terrasat Communications Inc., and ViaSat, Inc.

Terrestrial and Wireless Networks – AT&T Inc., Atos, Bandwidth.com, CalAmp Corp., Carbyne, Central Square Technologies, 8x8, Inc., Everbridge, Inc., Google Inc.

(a subsidiary of Alphabet Inc.), Here Technologies, Immersive Labs, INdigital, Intrado Corporation (formerly West Corporation), LM Ericsson, Lumen Technologies, Inc.

(formerly CenturyLink, Inc.), Mobile Arts AB, Motorola Solutions, Inc., NGA911, Nokia Networks (a subsidiary of Nokia Corporation), RapidDeploy, Inc., Rave Mobile Safety, Sinch AB (Inteliquent), Synergem Technologies, ThriveDX, and TomTom N.V.

We believe that competition in all our markets is based primarily on technology innovation, product performance, reputation, delivery times, customer support and price.

Due to our proprietary know-how, we believe we can develop, produce and deliver products and services on a cost-effective basis faster than many of our competitors.

Corporate Responsibility and Sustainability

We recognize the need for driving corporate responsibility within our organization, throughout our supplier network and in our communities.

To drive this responsibility, we will continue to target effective corporate governance, ethical behavior in the workplace and social responsibility, while also updating and enhancing this focus with initiatives, such as:

• refreshing the roles and responsibilities of the committees of our Board of Directors, including with the establishment of an Environment, Social and Governance ("ESG") task force supervised by our Board of Directors,

• developing a company-wide People Strategy to foster and promote workplace talent and diversity, and

• organizing a company-wide strategic sourcing group that will be accountable for tracking and driving resource reduction targets, such as resource-efficient manufacturing, reduction of hazardous substances, and take-back, recycling and reuse of products.

Human Capital

We realize that our employees are one of our most valuable assets and believe our success depends on the talent we attract and retain, which is why we are developing what we call our People Strategy.

We are passionate about building meaningful employee engagement and happiness in a variety of ways that will be addressed in our People Strategy, including providing a foundation for a diverse, inclusive and equitable workplace where employees feel they belong;

developing and promoting talent;

supporting a competitive benefits program;

and enforcing the importance of our employees’ health, safety and wellness.

Diversity, Equity, Inclusion and Belonging

We believe a diverse, equitable, inclusive workplace is critical to our ability to develop innovative solutions and is key to the future of our success.

We encourage employees to be inspired and strive for them to feel like they belong.

We focus on expanding our diverse workforce by reaching out to institutions promoting the employment of minorities, attending recruiting events aimed at attracting talent of diverse heritage and veteran backgrounds, as well as by considering diversity of our workforce during our talent, promotion, and succession planning.

Through these and other efforts, during fiscal 2022, two additional female executives were hired onto our executive leadership team, including our first female Chief Operating Officer.

Three female professionals were also recently appointed to our Board of Directors ("Board") (which currently consists of 37.5% female and 62.5% male Board members).

Additionally, in fiscal 2022, a member of our executive leadership team was recognized as an honoree for diversity in business based on such individual's efforts in our organization and the community.

Our leadership team identified several company-wide diversity initiatives such as celebrating Black History Month, Asian American Pacific Islander Heritage Month, International Women’s Day and Pride Month, where employees and their families are encouraged to participate, celebrate, and showcase their views, culture, and history on our social media and company-wide communication platforms.

When unique stories are celebrated, employees feel connected in meaningful ways and support each other to reach our full potential.

Employee Workforce as of July 31, 2022

People of Color

People with Disabilities

* People of Color include employees who identify with any race other than white.

To meet and execute our strategic business goals, we are focused on sourcing, attracting, and retaining top talent, especially those with engineering, science, and technical backgrounds.

We recognize and reward performance while continually developing, engaging and retaining high-performing employees.

We have made significant investments to provide ongoing training and career development by offering courses on our online learning management system.

We offer job-specific skills training to promote and develop advancement within the organization and to enhance skills.

Training in and compliance with our Standards of Business Conduct and Trade and FCPA compliance is also mandatory among our employees.

Through certain government contracts that we participate in, we partner with our end customer to provide enlisted, active military personnel (whose service is expected to end within 6 months) onsite training to help them with a successful transition to a civilian life.

Also, in an effort to retain and attract new talent, we partner with local universities to hire interns throughout our organization.

During fiscal 2022, we engaged several interns throughout the company with interests ranging from procurement, engineering, and legal practice.

At July 31, 2022, we had 1,993 employees (including temporary employees and contractors), 1,143 of whom were engaged in production and production support, 498 in research and development and other engineering support, and 352 in marketing and administrative functions.

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based employees are represented by a labor union.

Of our 2,038 employees, 489 employees are based outside of the United States including 217 employees in the United Kingdom.

Of our 1,993 employees, 496 employees are based outside of the United States, including 148 employees in the United Kingdom, 139 employees in India and 138 employees in Canada.

We believe that our employee relations are good.

Safety and Wellness

We strive to maintain a robust health, safety and wellness program to ensure a healthy work environment, promote workforce resiliency, and enhance business value.

We encourage employee participation to identify opportunities for improvement and review and monitor our performance with safety committees on the local level.

Local safety committees identify safety programs and ensure completion of all training and target learning objectives.

We continue to review our business models to support flexible working arrangements, where possible, to meet the needs of our employees and our business.

We continue to review CDC guidelines to monitor safety measures in all facilities in light of the continuing COVID-19 pandemic.

Employee wellness is important to Comtech.

All employees and their households have access to an employee assistance program, as well as a health advocate program to help with all aspects of benefits, family life, financial concerns, legal issues and transition to retirement.

Assistance is available 365 days per year, 24 hours per day.

We rigorously review our benefit and compensation plans to maintain competitive packages that reflect the wellness needs of our workforce and the marketplace.

These programs include 401(k) plans, health and welfare benefits, among many others.

We support pay equity for all employees within the same geographic area, experience level, and performance standards.

We encourage our employees to respect our environment.

To compound these efforts, we offer recycling bins at our facilities and encourage employees to use environmentally friendly commuting options such as mass transit (providing company sponsored mass transit cards) and share ride programs.

Where appropriate, we also consider work from home arrangements to eliminate commuting altogether.

In 2022, we celebrated Earth Day in our company by encouraging our global employees to participate in environmentally-focused initiatives and then share their activities on social media.

Government Contracts and Security Clearances

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government may be unable to complete its budget process before the end of any given government fiscal year and when the fiscal budget is not approved in a timely manner, the U.S.

government is required either to shut down or be funded pursuant to a so-called "continuing resolution" that authorizes agencies of the U.S.

government is required either to shut down or be funded pursuant to a "continuing resolution" that authorizes agencies of the U.S.

government to continue operations but does not authorize new spending initiatives, either of which could result in reduced or delayed orders or payments for products and services we provide.

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A violation of any of the regulations enumerated above could materially adversely affect our business, financial condition and results of operations.

Additionally, changes in regulatory requirements which could further restrict our ability to deliver services to our international customers, including the addition of a country to the list of sanctioned countries under the IEEPA or similar legislation could negatively impact our business.

Additionally, changes in regulatory requirements could further restrict our ability to deliver services to our international customers, including the addition of a country to the list of sanctioned countries under the IEEPA or similar legislation could negatively impact our business.

In the past, we have self-reported violations of export control laws or regulations to the U.S.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business