ZEBRA TECHNOLOGIES CORP/DE (Form: 10-Q, Received: 04/30/2008 17:07:50)

Three Months Ended

March 29,

March 31,

Changes in unrealized gains and losses on available- for-sale securities, net of tax, recorded in accumulated other comprehensive income

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

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

For the quarterly period ended March 29, 2008

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 000-19406

Zebra Technologies Corporation

(Exact name of registrant as specified in its charter)

Delaware

36-2675536

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)


333 Corporate Woods Parkway, Vernon Hills, IL 60061
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (847) 634-6700

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

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


Large accelerated filer x		Accelerated filer ¨
Non-accelerated filer ¨ (Do not check if smaller reporting company)		Smaller reporting company ¨

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

As of April 25, 2008, there were the following shares outstanding:

Class A Common Stock, $.01 par value 65,013,638

ZEBRA TECHNOLOGIES CORPORATION

QUARTER ENDED MARCH 29, 2008

INDEX


		PAGE
PART I - FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

Consolidated Balance Sheets as of March 29, 2008 (unaudited) and December 31, 2007		3

Consolidated Statements of Earnings (unaudited) for the three months ended March 29, 2008 and March 31, 2007		4

Consolidated Statements of Comprehensive Income (unaudited) for the three months ended March 29, 2008 and March 31, 2007		5

Consolidated Statements of Cash Flows (unaudited) for the three months ended March 29, 2008 and March 31, 2007		6

Notes to Consolidated Financial Statements		7

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		19

Item 3. Quantitative and Qualitative Disclosures About Market Risk		27

Item 4. Controls and Procedures		28

PART II - OTHER INFORMATION

Item 1. Legal Proceedings		29

Item 1A. Risk Factors		29

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		29

Item 6. Exhibits and Reports on Form 8-K		30

SIGNATURES		31

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PART I - FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)


	March 29, 2008			December 31, 2007
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	56,814		$	38,211
Restricted cash		2,738			2,497
Investments and marketable securities		97,407			98,438
Accounts receivable, net		171,862			150,775
Inventories, net		89,443			85,038
Deferred income taxes		14,483			14,772
Prepaid expenses and other current assets		10,776			31,101

Total current assets		443,523			420,832

Property and equipment at cost, less accumulated depreciation and amortization		69,716			67,686
Long-term deferred income taxes		31,990			28,407
Goodwill		247,670			246,510
Other intangibles, net		115,287			119,424
Long-term investments and marketable securities		149,325			142,033
Other assets		9,095			9,386

Total assets	$	1,066,606		$	1,034,278

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	47,119		$	42,351
Accrued liabilities		85,229			69,437
Deferred revenue		11,111			9,633
Income taxes payable		13,300			751

Total current liabilities		156,759			122,172
Deferred rent		1,011			961
Other long-term liabilities		9,681			8,452

Total liabilities		167,451			131,585

Stockholders’ equity:
Preferred Stock		—			—
Class A Common Stock		722			722
Additional paid-in capital		143,457			141,522
Treasury stock		(236,722	)		(205,058	)
Retained earnings		988,156			960,512
Accumulated other comprehensive income		3,542			4,995

Total stockholders’ equity		899,155			902,693

Total liabilities and stockholders’ equity	$	1,066,606		$	1,034,278

See accompanying notes to consolidated financial statements.

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ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS

(Amounts in thousands, except per share data)

(Unaudited)


	Three Months Ended
	March 29, 2008			March 31, 2007
Net sales	$	246,277		$	208,576
Cost of sales		123,480			108,786

Gross profit		122,797			99,790
Operating expenses:
Selling and marketing		30,861			28,164
Research and development		19,789			14,185
General and administrative		25,045			17,932
Amortization of intangible assets		4,514			2,323
Exit costs		3,234			—
Acquired in-process research and development		—			1,853

Total operating expenses		83,443			64,457

Operating income		39,354			35,333

Other income (expense):
Investment income		2,405			5,304
Foreign exchange gains		700			175
Other, net		(254	)		76

Total other income		2,851			5,555

Income before income taxes		42,205			40,888
Income taxes		14,561			14,172

Net income	$	27,644		$	26,716

Basic earnings per share	$	0.42		$	0.39
Diluted earnings per share	$	0.42		$	0.39
Basic weighted average shares outstanding		66,134			68,908
Diluted weighted average and equivalent shares outstanding		66,518			69,367

See accompanying notes to consolidated financial statements.

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ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in thousands)

(Unaudited)


	Three Months Ended
	March 29, 2008			March 31, 2007
Net income	$	27,644		$	26,716
Other comprehensive income (loss):
Foreign currency translation adjustment		1,798			(179	)
Changes in unrealized losses on hedging transactions, net of tax benefit		(3,935	)		(81	)
Changes in unrealized gains on investments, net of tax		684			188

Comprehensive income	$	26,191		$	26,644

See accompanying notes to consolidated financial statements.

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ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)


	Three Months Ended
	March 29, 2008			March 31, 2007
Cash flows from operating activities:
Net income	$	27,644		$	26,716
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		9,088			5,853
Stock-based compensation		3,417			3,338
Excess tax benefit from share-based compensation		(51	)		(479	)
Acquired in-process research and development		—			1,853
Deferred income taxes		(3,553	)		(1,097	)
Changes in assets and liabilities, net of effects of acquisitions:
Accounts receivable, net		(21,393	)		(7,065	)
Inventories		(3,834	)		2,779
Other assets		1,256			(123	)
Accounts payable		2,901			(12,275	)
Accrued liabilities		7,085			(7,619	)
Deferred revenue		2,745			3,301
Income taxes payable		12,534			10,815
Other operating activities		(5,635	)		834

Net cash provided by operating activities		32,204			26,831

Cash flows from investing activities:
Purchases of property and equipment		(5,909	)		(5,333	)
Acquisition of businesses acquired, net of cash acquired		—			(127,200	)
Purchases of investments and marketable securities		(190,530	)		(166,285	)
Maturities of investments and marketable securities		128,723			195,424
Sales of investments and marketable securities		78,156			78,069

Net cash provided by (used in) investing activities		10,440			(25,325	)

Cash flows from financing activities:
Purchase of treasury stock		(24,600	)		(6,048	)
Proceeds from exercise of stock options and stock purchase plan purchases		667			4,337
Excess tax benefit from share-based compensation		51			479

Net cash used in financing activities		(23,882	)		(1,232	)

Effect of exchange rate changes on cash		(159	)		18

Net increase in cash and cash equivalents		18,603			292
Cash and cash equivalents at beginning of period		38,211			39,648

Cash and cash equivalents at end of period	$	56,814		$	39,940

Supplemental disclosures of cash flow information:
Income taxes paid		2,471			4,357
Supplemental disclosures of non-cash transactions:
Purchase of treasury shares not paid in the first quarter of 2008	$	9,153			—

See accompanying notes to consolidated financial statements.

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ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1—Basis of Presentation

Management prepared these unaudited interim consolidated financial statements for Zebra Technologies Corporation and subsidiaries (Zebra) according to the rules and regulations of the Securities and Exchange Commission (SEC) for interim financial information. Accordingly, they do not include all of the information and footnotes required by United States generally accepted accounting principles (GAAP) for complete financial statements. Therefore, these consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in Zebra’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007.

The consolidated balance sheet as of December 31, 2007, in this Form 10-Q is taken from the audited consolidated balance sheet in our Form 10-K. These interim financial statements include all adjustments (of a normal, recurring nature) necessary to present fairly Zebra’s consolidated financial position as of March 29, 2008, the consolidated results of operations for the three months ended March 29, 2008 and March 31, 2007, and cash flows for the three months ended March 29, 2008 and March 31, 2007. These results, however, are not necessarily indicative of results for the full year.

Note 2—Fair Value Measurements

In February 2007, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 159, The Fair Value Option for Financial Assets and Financial Liabilities — Including an amendment of FASB Statement No. 115 . SFAS No. 159 permits entities to elect to measure many financial instruments and certain other items at fair value. Unrealized gains and losses on items for which the fair value option has been elected will be recognized in earnings at each subsequent reporting date. SFAS No. 159 was effective for Zebra on January 1, 2008. We have currently chosen not to elect the fair value option for any items that are not already required to be measured at fair value in accordance with accounting principles generally accepted in the United States. The adoption of SFAS No. 159 did not have a material impact on our consolidated financial statements.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements , which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. SFAS No. 157 was effective for our Company on January 1, 2008. However, in February 2008, the FASB released FASB Staff Position (FSP FAS 157-2 — Effective Date of FASB Statement No. 157), which delayed the effective date of SFAS No. 157 for all nonfinancial assets and nonfinancial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). The adoption of SFAS No. 157 for our financial assets and liabilities did not have a material impact on our consolidated financial statements. We do not believe the adoption of SFAS No. 157 for our non-financial assets and liabilities, effective January 1, 2009, will have a material impact on our consolidated financial statements.

As defined in SFAS No. 157, fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, SFAS No. 157 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

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In determining fair value, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as consider counterparty credit risk in the assessment of fair value.

Financial assets and liabilities carried at fair value as of March 29, 2008 are classified in the table below in one of the three categories described above (in thousands):


	Level 1		Level 2		Level 3		Total
Assets:
Cash and cash equivalents (1)	$	56,814	$	—	$	—	$	56,814
Restricted cash		2,738		—		—		2,738
Available-for-sale securities		235,799		—		—		235,799
Money market investments related to the deferred compensation plan		4,071		—		—		4,071

Total assets at fair value	$	299,422	$	—	$	—	$	299,422

Liabilities:
Forward contracts (2)	$	4,019	$	13,372	$	—	$	17,391
Liabilities related to the deferred compensation plan		3,913		—		—		3,913

Total liabilities at fair value	$	7,932	$	13,372	$	—	$	21,304

1)	Includes cash, money market investments and certificates of deposits.

2)	The fair value of forward contracts are calculated as follows:

Fair value of forward collar contract associated with forecasted sales hedges are calculated using the midpoint of ask and bid rates for similar contracts.

Fair value of regular forward contracts associated with forecasted sales hedges are calculated using the month-end exchange rate adjusted for the discount rate (3 month LIBOR rate).

Fair value of balance sheet hedges are calculated at the month end exchange rate adjusted for current forward points unless the hedge has been traded but not settled at month end. If this is the case, the fair value is calculated at the rate at which the hedge is being settled.

Note 3—Stock-Based Compensation

As of March 29, 2008, Zebra had a stock option plan and a stock purchase plan available for future grants. We accounted for these plans in accordance with SFAS No. 123(R), Share-Based Payments . Zebra recognizes compensation costs over the vesting period of 1 month to 5 years.

The compensation expense and the related tax benefit for share-based payments were included in the Consolidated Statement of Earnings as follows (in thousands):


	Three Months Ended
	March 29, 2008		March 31, 2007
Cost of sales	$	309	$	452
Selling and marketing		691		424
Research and development		484		657
General and administration		1,933		1,805

Total compensation		3,417		3,338

Income tax benefit	$	1,179	$	1,151

SFAS No. 123(R) requires the cash flows resulting from the tax benefits from tax deductions in excess of the compensation cost recognized (excess tax benefits) to be classified as financing cash flows in the statement of cash flows. As a result, $51,000 of excess tax benefits for the three months ended March 29, 2008, have been classified as financing cash flows. The excess tax benefits for the three months ended March 31, 2007 was $479,000.

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For purposes of calculating the compensation cost consistent with SFAS No. 123(R), the fair value is estimated on the date of grant using a binomial model. Volatility is based on an average of the implied volatility in the open market and the annualized volatility of Zebra’s stock prices over our entire stock history. The following table shows the weighted-average assumptions used for stock option grants as well as the fair value of the options granted based on those assumptions:


	Three months ended
	March 29, 2008	March 31, 2007
Expected dividend yield	0%	0%
Forfeiture rate	7.69%	7.43%
Volatility	34.73%	38.30%
Risk free interest rate	4.55%	4.58%
- Range of interest rates	4.55% - 5.03%	4.38% - 4.73%
Expected weighted-average life	4.88 years	4.58 years
Fair value of options granted	$112,000	$985,000
Weighted-average grant date fair value of options granted	$11.20	$11.63

The fair value of the purchase rights of all Zebra employees issued under the Stock Purchase Plan is estimated using the following weighted-average assumptions for purchase rights granted. Expected lives of three months to one year have been used along with these assumptions.


	Three months ended
	March 29, 2008			March 31, 2007
Fair market value	$	33.32		$	38.61
Option price	$	28.32		$	29.57
Expected dividend yield		0	%		0	%
Expected volatility		37	%		23	%
Risk free interest rate		3.29	%		4.89	%

Stock option activity for the period ended March 29, 2008, was as follows:


	2008
Fixed Options	Shares			Weighted-Average Exercise Price
Outstanding at beginning of year		3,029,138		$	34.68
Granted		10,000			32.43
Exercised		(60,040	)		13.29
Forfeited		(28,408	)		38.08
Expired		(10,632	)		42.06

Outstanding at end of period		2,940,058		$	35.05
Options exercisable at end of period		1,640,617		$	32.06
Intrinsic value of options exercised	$	1,125,950

The following table summarizes information about fixed stock options outstanding at March 29, 2008:


	Options Outstanding				Options Exercisable
Range of Exercise Prices	Number of Shares	Weighted-Average Remaining Contractual Life	Weighted-Average Exercise Price		Number of Shares	Weighted-Average Exercise Price
$ 1.29-$20.22	300,414	4.83 years	$	13.09	189,801	$	12.67
$ 20.22-$28.22	781,863	4.08 years		23.94	739,876		24.03
$ 28.22-$41.25	730,919	8.52 years		38.52	88,610		35.75
$ 41.25-$46.18	662,191	7.76 years		44.22	325,912		45.15
$ 46.18-$53.92	464,671	6.28 years		49.42	296,418		49.03

	2,940,058				1,640,617

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	Options Outstanding		Options Exercisable
Aggregate intrinsic value	$	12,990,000	$	10,423,000
Weighted-average remaining contractual term		6.4 years		5.0 years

As of March 29, 2008, there was $21,495,000 of unearned compensation cost related to stock options granted under the plans. That cost is expected to be recognized over a weighted-average period of 2.8 years.

Note 4—Inventories

The components of inventories are as follows (in thousands):


	March 29, 2008		December 31, 2007
Raw materials	$	46,920	$	46,572
Work in process		3,026		2,124
Finished goods		39,497		36,342

Total inventories	$	89,443	$	85,038

Note 5—Business Combinations

Navis, LLC. On December 14, 2007, Zebra acquired all of the outstanding stock of Navis Holdings, LLC (Navis) for $143,942,000, which is net of cash acquired and transaction costs. Headquartered in Oakland, California, Navis provides solutions to optimize the flow of goods through marine terminals and other operations managing cargo in the supply chain. The consolidated statements of earnings reflect the results of operations of Navis since the effective date of the purchase. The pro forma impact of this acquisition was not significant.

The following table (in thousands) summarizes the estimated fair values of the assets acquired and the liabilities assumed at the date of acquisition.


	At December 14, 2007
Current assets	$	26,658
Property and equipment		2,807
Intangible assets		58,400
Goodwill		74,907

Total assets acquired	$	162,772

Current liabilities		(18,830	)

Net assets acquired	$	143,942

On a preliminary basis pending the receipt of final valuations, the purchase price was allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated fair values resulting in goodwill of $74,907,000. The intangible assets of $58,400,000 consist of the following (in thousands):


	Amount		Useful life
Trade names	$	2,300	2 years
Customer relationships		39,000	15 years
Developed technology		17,100	6 years

The goodwill is deductible for tax purposes.

Note 6—Investments and Marketable Securities

We classify our investments in marketable debt securities as available-for-sale in accordance with the classifications defined in SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities. As of March 29, 2008, all of our investments in marketable debt securities with maturities greater than one year are classified as long-term investments on the balance sheet due to our ability and intent to hold them until maturity.

SFAS No. 115 requires that changes in the market value of available-for-sale securities are reflected in the accumulated other comprehensive income caption of stockholders’ equity in the balance sheet, until we dispose of the securities. Once these securities are disposed of, either by sale or maturity, the accumulated changes in market

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value are transferred to investment income. On the cash flow statements, changes in the balances of available-for-sale securities are shown as purchases, sales and maturities of investments and marketable securities under investing activities.

Changes in market value of trading securities would be recorded in investment income as they occur, and the related cash flow statement would include changes in the balances of trading securities as operating cash flows.

All investments in marketable debt securities except the partnership interests are classified as available-for-sale securities. We account for the partnership interests using the cost method until our ownership percentage reaches 5% of the total partnership portfolio value, because at that point we begin using the equity method to account for the partnership interest. As of March 29, 2008, we were in the process of liquidating all of our interests in these partnerships, which totaled $10,933,000. This liquidation will be complete by July 2008. For the three months ended March 29, 2008, we did not record any activity related to these partnership interests. No other gains or losses on trading securities were recorded in investment income.

Change in unrealized gains and losses on available-for-sale securities are included in these financial statements as follows (in thousands):

Note 7—Stockholders’ Equity

Share count and par value data related to stockholders’ equity are as follows:


	March 29, 2008		December 31, 2007
Preferred Stock
Par value per share	$	0.01	$	0.01
Shares authorized		10,000,000		10,000,000
Shares outstanding		—		—
Common Stock - Class A
Par value per share	$	0.01	$	0.01
Shares authorized		150,000,000		150,000,000
Shares issued		72,151,857		72,151,857
Shares outstanding		65,396,514		66,370,248
Treasury stock
Shares held		6,755,343		5,781,609

Note 8—Other Comprehensive Income (Loss)

Stockholders’ equity includes certain items classified as accumulated other comprehensive income, including:

•

Foreign currency translation adjustment relates to our non-U.S. subsidiary companies that have designated a functional currency other than the U.S. dollar. We are required to translate the subsidiary functional currency financial statements to dollars using a combination of historical, month-end, and average foreign exchange rates. This combination of rates creates the foreign currency translation adjustment component of other comprehensive income.

•

Unrealized gains (losses) on foreign currency hedging activities relate to derivative instruments used to hedge the currency exchange rates for forecasted euro sales. These hedges are designated as cash flow hedges, and we have deferred income statement recognition of gains and losses until the hedged transaction occurs. See Note 11 for more details.

•

Unrealized gains (losses) on investments classified as available-for-sale are deferred from income statement recognition until the gains or losses are realized. See Note 6 above for more details.

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The components of other comprehensive income included in the Consolidated Statements of Comprehensive Income are as follows (in thousands):


	Three Months Ended
	March 29,			March 31,
	2008			2007
Foreign currency translation adjustments	$	1,798		$	(179	)

Changes in unrealized losses on foreign currency hedging activities:
Gross	$	(6,309	)	$	(130	)
Income tax benefit		(2,374	)		(49	)

Net	$	(3,935	)	$	(81	)

Changes in unrealized gains on investments classified as available-for-sale:
Gross	$	1,096		$	302
Income tax		412			114

Net	$	684		$	188

The components of accumulated other comprehensive income (loss) included in the Consolidated Balance Sheets are as follows (in thousands):


	As of
	March 29,			December 31,
	2008			2007
Foreign currency translation adjustments	$	12,475		$	10,677

Unrealized losses on foreign currency hedging activities:
Gross	$	(15,561	)	$	(9,252	)
Income tax benefit		(5,856	)		(3,482	)

Net	$	(9,705	)	$	(5,770	)

Unrealized gains on investments classified as available-for-sale:
Gross	$	1,237		$	141
Income tax		465			53

Net	$	772		$	88

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Note 9—Earnings Per Share

Earnings per share after the cumulative effect of the accounting change were computed as follows (in thousands, except per share amounts):


	Three Months Ended
	March 29, 2008		March 31, 2007
Basic earnings per share:
Net income	$	27,644	$	26,716

Weighted average common shares outstanding		66,134		68,908

Per share amount	$	0.42	$	0.39
Diluted earnings per share:
Net income	$	27,644	$	26,716

Weighted average common shares outstanding		66,134		68,908
Add: Effect of dilutive securities – stock options		384		459

Diluted weighted average and equivalent shares outstanding		66,518		69,367

Per share amount	$	0.42	$	0.39

Potentially dilutive securities that were excluded from the earnings per share calculation consist of stock options with an exercise price greater than the average market closing price of the Class A common stock. These options were as follows:


	Three Months Ended
	March 29, 2008	March 31, 2007
Potentially dilutive shares	1,858,000	1,107,000

Note 10—Goodwill and Other Intangible Asset Data

Intangible asset data are as follows (in thousands):


	March 29, 2008					December 31, 2007
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets
Current technology	$	51,975	$	(15,402	)	$	51,700	$	(13,526	)
Patent and patent rights		31,697		(7,440	)		31,697		(6,468	)
Customer relationships		60,859		(6,402	)		60,685		(4,664	)

Total	$	144,531	$	(29,244	)	$	144,082	$	(24,658	)

Unamortized intangible assets
Goodwill	$	247,670				$	246,510
Aggregate amortization expense
For the year ended December 31, 2007						$	11,128
For the three months ended March 29, 2008	$	4,514
Estimated amortization expense
For the year ended December 31, 2008		17,727
For the year ended December 31, 2009		17,338
For the year ended December 31, 2010		15,469
For the year ended December 31, 2011		15,117
For the year ended December 31, 2012		14,202
Thereafter		39,948

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We test the impairment of goodwill each year or between annual impairment dates whenever events or changes in circumstances indicate that the carrying value may not be recoverable. We completed our last assessment during June 2007. At that time, no adjustment to goodwill was necessary due to impairment.

We evaluate the impairment of identifiable intangibles and other long-lived assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable.

Factors considered that may trigger an impairment review consist of:

•

Significant underperformance relative to expected historical or projected future operating results,

•

Significant changes in the manner of use of the acquired assets or the strategy for the overall business,

•

Significant negative industry or economic trends,

•

Significant decline in Zebra’s stock price for a sustained period, and

•

Significant decline in market capitalization relative to net book value.

If we believe that one or more of the above indicators of impairment have occurred, we compare the carrying value to the undiscounted cash flows of the asset to determine if the carrying value is recoverable. If the carrying value is not determined to be recoverable, we measure impairment based on a projected discounted cash flow using a discount rate that incorporates the risk inherent in the cash flows.

Note 11—Derivative Instruments

In the normal course of business, portions of Zebra’s operations are subject to fluctuations in currency values. We manage these risks using derivative financial instruments.

Hedging of Net Assets

We use forward contracts and options to manage exposure related to our pound and euro denominated net assets. We record gains and losses on these contracts and options in income each quarter along with the transaction gains and losses related to our net euro asset position, which would ordinarily offset each other. Summary financial information related to these activities follows (in thousands):


	Three Months Ended
	March 29,			March 31,
	2008			2007
Change in losses from foreign exchange derivatives	$	(4,020	)	$	(223	)
Gain on net foreign currency assets		4,720			398

Net foreign exchange gain	$	700		$	175


	As of
	March 29, 2008		December 31, 2007
Notional balance of outstanding contracts:
Pound/US dollar	£	3,000	£	3,000
Euro/US dollar	€	17,000	€	14,000
Euro/Pound	€	18,000	€	20,500
Net fair value of outstanding contracts	$	74	$	(104	)

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Hedging of Anticipated Sales

We manage the exchange rate risk of anticipated euro denominated sales using forward contracts and option collars. We designate these contracts as cash flow hedges. Gains and losses on these contracts are deferred in other comprehensive income until the contracts are settled and the hedged sales are realized, at which time the deferred gains or losses will be reported as an increase or decrease to sales. Summary financial information related to the cash flow hedges of future revenues follows (in thousands, except percentages):


	As of
	March 29, 2008			December 31, 2007
Net unrealized losses deferred in other comprehensive income:
Gross	$	(15,561	)	$	(9,252	)
Income tax benefit		(5,856	)		(3,482	)

Net	$	(9,705	)	$	(5,770	)

Notional balance of outstanding contracts	€	79,900		€	108,500
Hedge effectiveness		100	%		100	%


	March 29, 2008			March 31, 2007
Net gains and (losses) included in revenue for the:
Three months ended	$	(2,788	)	$	(135	)

Note 12—Segment Information

As a result of the acquisitions of WhereNet Corp., proveo AG, and Navis Holdings, LLC, Zebra now has two reportable segments: Specialty Printing Group (SPG) and Enterprise Solutions Group (ESG).

SPG includes direct thermal and thermal transfer label and receipt printers, passive radio frequency identification (RFID) printer/encoders, dye sublimation card printers and digital photo printers. Also included in this group is a comprehensive range of specialty supplies consisting of self-adhesive labels, thermal transfer ribbons, thermal printheads, batteries and other accessories, including software for label design and printer network management.

ESG has evolved over the last year with the acquisitions of WhereNet Corp., proveo AG, and Navis Holdings, LLC. The solutions that these companies provide are sold on a contract basis and are typically installed over several quarters. These contracts cover a range of services, including design, installation and ongoing maintenance services.

Segment information is as follows (in thousands):


	Three Months Ended
	March 29, 2008			March 31, 2007
Net sales:
SPG	$	224,751		$	201,895
ESG		21,526			6,681

Total	$	246,277		$	208,576

Operating profit (loss):
SPG	$	61,605		$	51,792
ESG		(7,063	)		(3,580	)
Corporate and other		(15,188	)		(12,879	)

Total	$	39,354		$	35,333


	March 29, 2008		December 31, 2007
Identifiable assets:
SPG	$	393,319	$	370,786
ESG		324,478		320,689
Corporate and other		348,809		342,803

Total	$	1,066,606	$	1,034,278

Corporate and other includes corporate administration costs or assets that support both reporting segments.

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Prior period amounts have been restated to conform to requirements of SFAS No. 131, Disclosures about Segments of and Enterprise and Related Information.

Note 13—Costs associated with Exit or Disposal Activities

During the first quarter of 2008, we initiated two different plans to close facilities. These plans are being accounted for under SFAS No. 146, Accounting for Cost Associated with Exit or Disposal Activities. All exit costs associated with these activities are identified on a separate line of our Consolidated Statement of Earnings, as part of operating expenses. These plans are intended to reduce costs and improve manufacturing efficiency.

In January 2008, we initiated a plan to close our supplies manufacturing plant in Warwick, Rhode Island. This operation is being transferred to a new facility in Flowery Branch, Georgia, which is now our East Coast supplies manufacturing facility. This transition is expected to be completed during the second quarter. As of March 29, 2008, we expect to incur the following exit costs (in thousands):


Type of Cost	Cost incurred to date		Additional cost expected		Total costs expected to be incurred
Severance, stay bonuses, and other employee-related expenses	$	358	$	32	$	390
Other exit costs		—		238		238

Total	$	358	$	270	$	628

In February 2008, we announced plans to establish regional distribution and configuration centers, consolidate our supplier base, and transfer final assembly of thermal printers to Jabil Circuit, Inc., a global third-party electronics manufacturer. These actions are intended to optimize our global printer product supply chain by improving responsiveness to customer needs and increasing Zebra’s flexibility to meet emerging business opportunities. As a result, all printer manufacturing in our Vernon Hills, Illinois and Camarillo, California will be transferred to Jabil’s facility in HuangPu, China. This transition is expected to take 18 to 24 months to complete. As of March 29, 2008, we expect to incur the following exit costs (in thousands):


Type of Cost	Cost incurred to date		Additional cost expected		Total costs expected to be incurred
Severance, stay bonuses, and other employee-related expenses	$	1,081	$	4,919	$	6,000
Professional services		1,051		3,914		4,965
Relocation and transition costs		744		13,377		14,121

Total	$	2,876	$	22,210	$	25,086

Liabilities and expenses related to exit activities for the three months ended March 29, 2008, were as follows (in thousands):


	Warwick Closure			Manufacturing Transfer		Total
Accrued liabilities related to exit activities at December 31, 2007	$	—		$	—	$	—
Expenses incurred for the three months ended March 29, 2008		358			2,876		3,234
Less: Amounts paid for the three months ended March 29, 2008		(51	)		—		(51	)

Accrued liabilities related to exit activities at March 29, 2008	$	307		$	2,876	$	3,183

All current exit costs are included in operating expenses for the Specialty Printing Group.

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Note 14—Contingencies

On January 31, 2003, a Writ of Summons was filed in the Nantes Commercial Court, Nantes, France, by Printherm, a French corporation, and several of its shareholders (collectively, “Printherm”), against Zebra Technologies France (“ZTF”), a French corporation and wholly-owned subsidiary of Zebra. Printherm seeks damages in the amount of €15,304,000 and additional unspecified damages in connection with ZTF’s termination of negotiations in December 2000 respecting the proposed acquisition by Zebra of the capital stock of Printherm. The negotiation was terminated based on unsatisfactory results of the ongoing due diligence. We believe that Printherm’s claims are without merit and that a loss is not likely to occur. We will vigorously defend the action.

Printherm filed bankruptcy proceedings on August 30, 2004, and the Commercial Court ordered its liquidation on November 30, 2004. The case was put on hold until the Court-appointed liquidator filed a submission in August 2005, which started the proceedings again. ZTF filed its answer on November 19, 2005, in anticipation of a Court-ordered December 19, 2005, hearing date. In response to a request by Printherm’s liquidator, the Court postponed the hearing date until March 27, 2008 to provide time for Printherm to respond to ZTF’s answer. The Printherm liquidator filed its response to ZTF’s answer shortly before the March 27 hearing date. ZTF argued that the filing date provided ZTF with insufficient time to prepare for the hearing, and the Court struck the case from the docket as a sanction against Printherm. Printherm’s liquidator will now be required to reinstate the case before the Court, and the Court has not yet determined the calendar for doing so.

On April 9, 2008, a complaint was filed in the U.S. District Court for the Northern District of Illinois by Barcode Informatica, Ltd. (“Barcode”), a former Brazilian reseller, against Zebra. The complaint alleges that Zebra wrongfully terminated Barcode’s reseller status and tortiously interfered with Barcode’s alleged bid for the sale of printers to Brazilian Post. Barcode’s claim seeks an unspecified amount of damages. We believe that Barcode’s claims are without merit and we will vigorously defend the action.

Note 15—Warranty . In general, Zebra provides warranty coverage of one year on printers against defects in material and workmanship. Printheads are warranted for nine months and batteries are warranted for three months. A provision for warranty expense is recorded at the time of shipment and adjusted quarterly based on historical warranty experience. The following is a summary of Zebra’s accrued warranty obligation (in thousands).


	Three Months Ended March 29, 2008			Three Months Ended March 31, 2007
Balance at the beginning of the year	$	3,411		$	2,250
Warranty expense year-to-date		1,711			1,661
Warranty payments made year-to-date		(1,299	)		(879	)

Balance at the end of the period	$	3,823		$	3,032

During 2005, Zebra began providing for environmental recycling reserves similar to warranty reserves. In the European Union, we have an obligation in the future to recycle printers. This reserve is based on all new printers sold after August 13, 2005, and printers sold prior to that date that are returned to us upon our sale of a new printer to a customer. The following is a summary of Zebra’s accrued recycling obligation (in thousands).


	Three Months Ended March 29, 2008		Three Months Ended March 31, 2007
Balance at the beginning of the year	$	3,706	$	2,115
Recycling expense year-to-date		778		437
Recycling payments made year-to-date		—		—
Exchange rate impact		8		(6	)

Balance at the end of the period	$	4,492	$	2,546

Note 16—Income Taxes

On January 1, 2007, we adopted Financial Accounting Standards Board (FASB) Interpretation (FIN) No. 48, Accounting for Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109 . According to FIN No. 48, we identified, evaluated, and measured the amount of income tax benefits to be recognized for all of our income tax positions. The net income tax assets recognized under FIN No. 48 did not differ from the net assets recognized

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before adoption, and, therefore, we did not record an adjustment related to the adoption of FIN No. 48. Zebra did not have any unrecognized tax benefits as of March 29, 2008.

Zebra has concluded all U.S. federal income tax audits for years through 2004. The tax years 2004 through 2007 remain open to examination by multiple state taxing jurisdictions.

Zebra’s continuing practice is to recognize interest and/or penalties related to income tax matters as part of income tax expense. For the quarter ended March 29, 2008, we did not accrue any interest or penalties into income tax expense.

The effective income tax rate for the first quarter of 2008 was 34.5% compared with an income tax rate of 34.7% for the first quarter of 2007.

Note 17—New Accounting Pronouncements

In December 2007, the FASB issued SFAS No. 141(R), Business Combinations , to create greater consistency in the accounting and financial reporting of business combinations. SFAS No. 141(R) establishes principles and requirements for how the acquirer in a business combination (i) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any non-controlling interest, (ii) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase, and (iii) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. This statement applies to fiscal years beginning after December 15, 2008 and will generally affect acquisitions going forward.

Note 18—Subsequent Events

On April 1, 2008, Zebra acquired all of the outstanding stock of Multispectral Solutions, Inc., (MSSI) for $18,000,000 in cash. MSSI is based in Germantown, Maryland, and is a global provider of ultra wideband (UWB) real-time locating systems and other UWB-based wireless technology. MSSI will become part of the Enterprise Solutions Group.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Consolidated Results of Operations

Net sales for the first quarter of 2008, compared with the first quarter of 2007, increased 18.1% with strength in all international regions. Sales from recent acquisitions supplemented continued robust sales growth of our established printer and service lines. Gross margin increased because of a richer product mix combined with higher average unit prices on mobile and desktop printers, improved labor efficiency and overhead spending control. Higher operating expenses resulted from increases in payroll costs, outside commissions, project costs, professional service fees, travel and entertainment expenses, recruiting and relocation costs, offsite meetings. Much of the increased payroll and benefit costs was a result of our recent acquisitions. In addition, amortization of intangibles increased $2,191,000, and we incurred exit costs of $3,234,000 related to the transfer of our printer manufacturing to a third-party manufacturer and the closure of our Warwick, Rhode Island, supplies manufacturing facility.


	Three Months Ended
	March 29, 2008		March 31, 2007		Percent Change		Percent of Total Sales - 2008	Percent of Total Sales - 2007
Net sales	$	246,277	$	208,576	18.1		100.0	100.0
Cost of sales		123,480		108,786	13.5		50.1	52.2

Gross profit		122,797		99,790	23.1		49.9	47.8
Operating expenses		83,443		64,457	29.5		33.9	30.9

Operating income		39,354		35,333	11.4		16.0	16.9

Other income		2,851		5,555	(48.7	)	1.1	2.7

Income before income taxes		42,205		40,888	3.2		17.1	19.6

Income taxes		14,561		14,172	2.7		5.9	6.8

Net income	$	27,644	$	26,716	3.5		11.2	12.8

Diluted earnings per share	$	0.42	$	0.39

Sales by product category, percent change, and percent of total sales for the three months ended March 29, 2008, and March 31, 2007, were (in thousands, except percentages):


	Three Months Ended
Product Category	March 29, 2008			March 31, 2007			Percent Change	Percent of Total Sales - 2008		Percent of Total Sales - 2007
Hardware	$	180,181		$	159,588		12.9	73.2		76.5
Supplies		41,902			38,081		10.0	17.0		18.3
Service and software		25,180			9,394		168.0	10.2		4.5
Shipping and handling		1,802			1,648		9.3	0.7		0.8
Cash flow hedging activities		(2,788	)		(135	)	NM	(1.1	)	(0.1	)

Total sales	$	246,277		$	208,576		18.1	100.0		100.0

Sales to customers by geographic region, percent changes and percent of total sales for the three months ended March 29, 2008, and March 31, 2007, were (in thousands, except percentages):


	Three Months Ended
Geographic Region	March 29, 2008		March 31, 2007		Percent Change	Percent of Total Sales - 2008	Percent of Total Sales - 2007
Europe, Middle East and Africa	$	97,370	$	75,985	28.1	39.5	36.4
Latin America		15,983		12,523	27.6	6.5	6.0
Asia-Pacific		23,778		15,562	52.8	9.7	7.5

Total International		137,131		104,070	31.8	55.7	49.9
North America		109,146		104,506	4.4	44.3	50.1

Total sales	$	246,277	$	208,576	18.1	100.0	100.0

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Zebra’s non-operating income and expense items are summarized in the following table (in thousands):


	Three Months Ended
	March 29, 2008			March 31, 2007
Investment income	$	2,405		$	5,304
Foreign exchange gain (loss)		700			175
Other, net		(254	)		76

Total other income	$	2,851		$	5,555

Rate of Return Analysis:
Average cash and marketable securities balances	$	293,732		$	505,837
Annualized rate of return		3.3	%		4.2	%

Cash and marketable securities balances and resulting investment income for the first quarter of 2008 have decreased substantially compared to the first quarter of 2007 due to payments for recent acquisitions.

Specialty Printing Group


	Three Months Ended
	March 29, 2008		March 31, 2007		Percent Change	Percent of Total Sales - 2008	Percent of Total Sales - 2007
Net sales	$	224,751	$	201,895	11.3	100.0	100.0
Cost of sales		112,812		104,266	8.2	50.2	51.6

Gross profit		111,939		97,629	14.7	49.8	48.4
Operating expenses		50,334		45,837	9.8	22.4	22.7

Operating income		61,605		51,792	18.9	27.4	25.7

Net sales in our Specialty Printing Group (SPG) increased 11.3% during the first quarter of 2008, with virtually all growth outside of North America. New printer products (defined as printers released within 18 months prior to the end of the applicable fiscal period) accounted for 19.1% of printer sales in the first quarter of 2008, compared with 12.2% of printer sales in the first quarter of 2007 and 16.6% for the fourth quarter of 2007.

Our international sales are denominated in multiple currencies, primarily the dollar, pound and euro. This directly causes our reported sales to be subject to fluctuations based on changes in currency rates. We estimate that favorable foreign exchange movements of the euro and the pound versus the dollar had a positive impact of $9,315,000 on sales during the first quarter.

We currently hedge a portion of anticipated euro-denominated sales to partially protect Zebra against exchange rate movements. For the first quarter, this program resulted in a loss of $2,788,000. See Note 11 to the Consolidated Financial Statements included in this report for a more detailed discussion of this hedging program.

Printer unit volumes and average selling price information is summarized below:


	Three Months Ended
	March 29, 2008		March 31, 2007		Percent Change
Total printers shipped		242,401		229,787	5.5
Average selling price of printers shipped	$	614	$	566	8.5

For the first quarter of 2008, unit volumes increased in nearly all printer product lines compared to the first quarter of 2007 with notable volume increases in high-performance tabletop and mobile printers.

Gross profit margin for SPG was affected by favorable foreign currency movements, which increased first quarter gross profit by $8,494,000. A rich product mix combined with higher mobile and desktop average unit selling prices,

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improved labor efficiency and overhead spending control also contributed to the improvement in gross margin for SPG during the first quarter of 2008.

Operating expenses increased primarily due to increases in payroll and benefit costs of $920,000. We also incurred $3,234,000 of costs related to the transfer of our printer manufacturing to a third-party manufacturer and the closure of our Warwick, Rhode Island, supplies manufacturing facility. In addition, we incurred costs in the amount of $577,000 to move our High Wycombe, UK location into a new facility.

Enterprise Solutions Group


	Three Months Ended
	March 29, 2008			March 31, 2007			Percent Change	Percent of Total Sales - 2008		Percent of Total Sales - 2007
Net sales	$	21,526		$	6,681		222.2	100.0		100.0
Cost of sales		10,668			4,520		136.0	49.6		67.7

Gross profit		10,858			2,161		402.5	50.4		32.3
Operating expenses		17,921			5,741		212.2	83.2		85.9

Operating loss		(7,063	)		(3,580	)	NM	(32.8	)	(53.6	)

During 2007, Zebra acquired three companies which are being combined to make up our Enterprise Solutions Group (ESG). On January 25, 2007, we acquired WhereNet Corp., a provider of active radio frequency identification (RFID) based wireless solutions used to track and manage enterprise assets. On July 2, 2007, we acquired proveo AG, a provider of complete hardware and software systems for tracking motorized vehicles using global positioning systems (GPS). On December 14, 2007, we acquired Navis Holdings, LLC., a provider of software solutions to optimize the flow of goods through marine terminals and other operations managing cargo movement through ports and intermodal facilities. Together, these companies give Zebra the ability to deliver more high-value applications that help our customers identify, track and manage assets, transactions and people.

Sales and gross margins for both 2007 and 2008 are being affected by deferred revenue adjustments mandated by the purchase accounting requirements. Only a portion of the deferred revenue is allowed to be recognized on contracts that were in process at the acquisition dates. In addition, due to the timing of these acquisitions throughout 2007, the first quarter revenue and expense amounts for 2007 only reflect a portion of the operating expenses for ESG.

ESG operating expenses for the first quarter of 2008 reflect normal spending rates and should continue at this rate going forward. Operating expenses for ESG include amortization expense of $3,039,000 for the first quarter of 2008, and $932,000 for the first quarter of 2007. A charge for acquired in process technology $1,853,000 was also included in the first quarter of 2007.

On April 1, 2008, Zebra acquired all of the outstanding stock of Multispectral Solutions, Inc. (MSSI). MSSI is a global provider of ultra wideband (UWB) real-time locating systems and other UWB-based wireless technology. MSSI will become part of the Enterprise Solutions Group.

Liquidity and Capital Resources

As of March 29, 2008, Zebra had $306,284,000 in cash and investment and marketable securities, compared with $281,179,000 at December 31, 2007. Factors affecting cash and investment balances during the first three months of 2008 include (note that changes discussed below include the impact of foreign currency):

•

Operations provided cash in the amount of $32,204,000, primarily from net income.

•

Accounts receivable increased $21,393,000 year-to-date because of higher sales. Days sales outstanding increased to 64 days in the first quarter of 2008 compared to 59 days at the end of 2007.

•

Inventories increased $3,834,000. Inventory turns remained at 5.6 during the first quarter of 2008 compared to the end of 2007.

•

Accounts payable increased $2,901,000, due to timing of vendor payments.

•

Taxes payable increased $12,534,000 because of the timing of tax payments.

•

Purchases of property and equipment totaled $5,909,000.

•

Net purchases of investments totaled $16,349,000.

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•

Purchases of treasury shares totaled $24,600,000. Zebra made open market repurchases of our shares under authorizations of the Board of Directors dated July 30, 2007 and February 25, 2008. An additional 277,187 shares had been repurchased for $9,153,000 as of March 29, 2008, but the cash had not yet been transferred.

•

Stock option exercises and purchases under the stock purchase plan contributed $667,000.

In February 2008, we announced that printer manufacturing is being transferred to a third-party manufacturer. This transition is expected to occur over the next 18 to 24 months. See Note 13 to the Consolidated Financial Statements included in this report for further information.

Management believes that existing capital resources and funds generated from operations are sufficient to finance anticipated capital requirements. It is our intention to actively pursue opportunities to acquire other businesses.

Critical Accounting Policies and Estimates

Management prepared the consolidated financial statements of Zebra Technologies Corporation under accounting principles generally accepted in the United States of America. These principles require the use of estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions we used are reasonable, based upon the information available.

Our estimates and assumptions affect the reported amounts in our financial statements. The following accounting policies comprise those that we believe are the most critical in understanding and evaluating Zebra’s reported financial results.

Revenue Recognition

Product revenue is recognized once four criteria are met: (1) we have persuasive evidence that an arrangement exists; (2) delivery has occurred and title has passed to the customer, which happens at the point of shipment provided that no significant obligations remain; (3) the price is fixed and determinable; and (4) collectability is reasonably assured. Other items that affect our revenue recognition include:

Customer Returns

Customers have the right to return products that do not function properly within a limited time after delivery. We monitor and track product returns and record a provision for the estimated future returns based on historical experience and any notification received of pending returns. Returns have historically been within expectations and the provisions established, but Zebra cannot guarantee that it will continue to experience return rates consistent with historical patterns. Historically, our product returns have not been significant. However, if a significant issue should arise, it could have a material impact on our financial statements.

Growth Rebates

Some of our channel program partners are offered incentive rebates based on the attainment of specific growth targets related to products they purchase from us over a quarter or year. These rebates are recorded as a reduction to revenue. Each quarter, we estimate the amount of outstanding growth rebates and establish a reserve for them based on shipment history. Historically, actual growth rebates have been in line with our estimates.

Price Protection

Some of our customers are offered price protection by Zebra as an incentive to carry inventory of our product. These price protection plans provide that if we lower prices, we will credit them for the price decrease on inventory they hold. We estimate future payments under price protection programs quarterly and establish a reserve, which is charged against revenue. Our customers typically carry limited amounts of inventory, and Zebra infrequently lowers prices on current products. As a result, the amounts paid under these plans have been minimal.

Software Revenue

We sell four types of software and record revenue as follows:

•

Our Enterprise Solutions Group has fixed fee software implementation projects , for which we use the percentage of completion method for revenue recognition. Under this method of accounting,

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we recognize revenue based on the ratio of costs incurred to total estimated costs. If increases in projected costs-to-complete are sufficient to create a loss contract, the entire estimated loss is charged to operations in the period the loss first becomes known.

•

Our printers contain embedded firmware, which is part of the hardware purchase. We consider the sale of this firmware to be incidental to the sale of the printer and do not attribute any revenue to it.

•

We sell a limited amount of prepackaged, or off-the-shelf, software for the creation of bar code labels using our printers. There is no customization required to use this software, and we have no post-shipment obligations on the software. Revenue is recognized at the time this prepackaged software is shipped.

•

We sometimes provide custom software as part of a printer installation project. We bill custom software development services separate from the related hardware. Revenue related to custom software is recognized once the custom software development services have been completed and accepted by the customer.

Shipping and Handling

We charge our customers for shipping and handling services based upon our internal price list for these items. The amounts billed to customers are recorded as revenue when the product ships. Any costs incurred related to these services are included in cost of sales.

From time to time, Zebra will enter into sales transactions that include more than one product type. This bundle of products might include printers, current or future supplies, and services. When this type of transaction occurs, we allocate the purchase price to each product type based on the fair value of the individual products. The revenue for each individual product is then recognized when the recognition criteria for that product is fully met.

Investments and Marketable Securities

Investments and marketable securities at March 29, 2008, consisted of the following:


U.S. government securities	19.3	%
State and municipal bonds	75.1	%
Corporate bonds	1.2	%
Partnership interests	4.4	%

We classify our debt and marketable equity securities in one of three categories: trading, available-for-sale or held-to-maturity. Trading securities are bought and held principally for the purpose of selling them in the near term. Held-to-maturity securities are those debt securities that Zebra has the ability and intent to hold until maturity. All securities not included in trading or held-to-maturity are classified as available-for-sale except for partnership interests described below.

Trading and available-for-sale securities are recorded at fair value. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization or accretion of discounts or premiums. Unrealized holding gains and losses on trading securities are included in earnings. Unrealized holding gains and losses, net of the related tax effect, on available-for-sale securities are excluded from earnings and are reported as a separate component of stockholders’ equity until realized. As of March 29, 2008, Zebra’s investments in marketable debt securities are classified as available-for-sale. In addition, as of March 29, 2008, all of our investments in marketable debt securities with maturities greater than one year are classified as long-term in the balance sheet due to our ability and intent to hold them until maturity.

All investments in marketable securities except the partnership interests are classified as available-for-sale securities. We account for the partnership interests using the costs method until our ownership percentage in a partnership reaches 5% of the total partnership portfolio value. At that time, we begin using the equity method to account for the partnership. During 2006, we reached the 5% threshold on one of our partnership interests. During 2007, we liquidated this partnership. During the fourth quarter of 2007, we also liquidated 95% of two other partnership interests, with the balances in all remaining partnership interests to be liquidated in 2008.

Accounts Receivable

We have standardized credit granting and review policies and procedures for all customer accounts, including:

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•

Credit reviews of all new customer accounts,

•

Ongoing credit evaluations of current customers,

•

Credit limits and payment terms based on available credit information,

•

Adjustments to credit limits based upon payment history and the customer’s current credit worthiness, and

•

An active collection effort by regional credit functions, reporting directly to the corporate financial officers.

We reserve for estimated credit losses based upon historical experience and specific customer collection issues. Over the last three years, accounts receivable reserves varied from 0.6% to 3.3% of total accounts receivable. Accounts receivable reserves as of March 29, 2008, were $5,384,000, or 3.0% of the balance due. We feel this reserve level is appropriate considering the quality of the portfolio as of March 29, 2008. While credit losses have historically been within expectations and the provisions established, we cannot guarantee that our credit loss experience will continue to be consistent with historical experience.

Inventories

We value our inventories at the lower of the actual cost to purchase or manufacture using the first-in, first-out (FIFO) method, or the current estimated market value. We review inventory quantities on hand and record a provision for excess and obsolete inventory based on forecasts of product demand and production requirements for the subsequent twelve months.

Over the last three years, our reserves for excess and obsolete inventories have ranged from 8.2% to 14.2% of gross inventory. As of March 29, 2008, inventory reserves were $7,967,000, or 8.2% of gross inventory. We feel this reserve level is appropriate considering the quantities and quality of the inventories as of March 29, 2008.

Valuation of Long-Lived and Intangible Assets and Goodwill

We test the impairment of goodwill each year or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. We completed our last assessment during June 2007. At that time, no adjustment to goodwill was necessary due to impairment.

We evaluate the impairment of identifiable intangibles and other long-lived assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable.

Factors considered that may trigger an impairment review consist of:

•

Significant underperformance relative to expected historical or projected future operating results,

•

Significant changes in the manner of use of the acquired assets or the strategy for the overall business,

•

Significant negative industry or economic trends,

•

Significant decline in Zebra’s stock price for a sustained period, and

•

Significant decline in market capitalization relative to net book value.

If we believe that one or more of the above indicators of impairment have occurred and the undiscounted cash flow test is failed in the case of amortizable assets, we measure impairment based on projected discounted cash flows using a discount rate that incorporates the risk inherent in the cash flows. Net intangible assets, long-lived assets and goodwill amounted to $432,673,000 as of March 29, 2008.

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Income Taxes

On January 1, 2007, we adopted Financial Accounting Standards Board (FASB) Interpretation (FIN) No. 48, “Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement No. 109”. According to FIN No. 48, we identified, evaluated, and measured the amount of income tax benefits to be recognized for all of our income tax positions. The net income tax assets recognized under FIN No. 48 did not differ from the net assets recognized before adoption, and, therefore, we did not record an adjustment related to the adoption of FIN No. 48. Zebra did not have any unrecognized tax benefits as of March 29, 2008.

Zebra has concluded all U.S. federal income tax audits for years through 2003. The tax years 2002 through 2006 remain open to examination by multiple state taxing jurisdictions.

Contingencies

We record estimated liabilities related to contingencies based on our estimates of the probable outcomes. Quarterly, we assess the potential liability related to pending litigation, tax audits and other contingencies and confirm or revise estimates and reserves as appropriate.

For a discussion of open legal matters, see Note 14 to the Consolidated Financial Statements.

Stock-based Compensation

As of March 29, 2008, Zebra had an active stock option plan and a stock purchase plan available for future grants. We accounted for these plans in accordance with SFAS No. 123(R), Share-Based Payments . Zebra recognizes compensation costs over the vesting period of 1 month to 5 years. See Note 3 to the Consolidated Financial Statements included in this report for further information.

Significant Customer

ScanSource, Inc. is our most significant customer. Our net sales to ScanSource, Inc., an international distributor of Zebra products, as a percentage of total net sales, were as follows:


	March 29, 2008		March 31, 2007
For the three months ended	15.6	%	16.0	%

No other customer accounted for 10% or more of total net sales during these time periods.

Safe Harbor

Forward-looking statements contained in this filing are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995 and are highly dependent upon a variety of important factors which could cause actual results to differ materially from those reflected in such forward looking statements. These factors include:

•

Market acceptance of Zebra’s printer and software products and competitors’ product offerings and the potential effects of technological changes,

•

The effect of market conditions in North America and other geographic regions,

•

Our ability to control manufacturing and operating costs, including the success of migrating final printer product assembly offshore to a third-party manufacturer,

•

Success of integrating acquisitions,

•

Interest rate and financial market conditions because of our large investment portfolio,

•

Foreign exchange rates due to the large percentage of our international sales and operations, and

•

The outcome of litigation in which Zebra is involved, particularly litigation or claims related to infringement of third-party intellectual property rights.

When used in this document and documents referenced, the words “anticipate,” “believe,” “estimate,” “will” and “expect” and similar expressions as they relate to Zebra or its management are intended to identify such forward-looking statements. We encourage readers of this report to review Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2007, for a further discussion of issues that could affect Zebra’s future

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results. Zebra undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason after the date of this report.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

There were no material changes in Zebra’s market risk during the quarter ended March 29, 2008. For additional information on market risk, refer to the “Quantitative and Qualitative Disclosures About Market Risk” section of our Form 10-K for the year ended December 31, 2007. See Note 6 to the Consolidated Financial Statements included in this report for further discussion of investments and marketable securities.

In the normal course of business, portions of Zebra’s operations are subject to fluctuations in currency values. We manage these risks using derivative financial instruments.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this Form 10-Q. The controls evaluation was conducted under the supervision of our Disclosure Committee, and with the participation of management, including our Chief Executive Officer and Chief Financial Officer. Based on that evaluation, our Chief Executive Office and Chief Financial Officer, have concluded that our disclosure controls and procedures were effective to provide reasonable assurance that (i) the information required to be disclosed by us in this report on Form 10-Q was recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (ii) information required to be disclosed by us in our reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

Zebra completed acquisitions of WhereNet Corp., and Navis Holding, LLC during 2007. In our report on internal controls included in our Form 10-K for the period ended December 31, 2007, we excluded these acquisitions from the scope. For our report on internal controls to be included in Form 10-K for the period ended December 31, 2008, these acquisitions will be included in the scope. Management is currently in the process of documenting and evaluating the internal controls for these acquisitions.

In January 2008, Zebra began a program to update substantially all of its key financial systems over a three year period. As pieces of these systems are completed, they will be subject to the requirements related to internal controls over financial reporting. The requirements for internal controls over financial reporting will be a fundamental element of the design and implementation of these systems.

During 2008, we made additional changes to our controls and procedures as part of our ongoing monitoring of our controls. However, none of these changes has materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on the Effectiveness of Controls

Our management, including our Chief Executive Office and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within Zebra have been detected.

These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

See Note 14 to the Consolidated Financial Statements included in this report.

Item 1A. Risk Factors

In addition to the other information included in this report, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2007, and the factors identified under “Safe Harbor” at the end of Item 2 of Part I of this Quarterly Report on Form 10-Q, which could materially affect our business, financial condition or future results. The risks described in our Annual Report on Form 10-K are not the only risks facing Zebra. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and/or operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Treasury Shares

During the first quarter of 2008, Zebra purchased 1,029,187 shares of Zebra’s Class A Common Stock as follows:

ISSUER PURCHASES OF EQUITY SECURITIES


Period	Total number of shares purchased	Average price paid per share		Total number of shares purchased as part of publicly announced program	Maximum number of shares that may yet be purchased under the program
January 2008 (January 1 – January 26)	—		—	—	380,700
February 2008 (January 27 – February 23)	—		—	—	380,700
March 2008 (February 24 – March 29)	1,029,187	$	32.80	1,029,187	2,351,513

(1) On August 1, 2007, Zebra announced that the Board authorized the purchase of 3,000,000 shares of Zebra common stock at prices to be determined at management’s discretion. The authorization did not have an expiration. On February 25, 2008, Zebra announced that the Board authorized the purchase of an additional 3,000,000 shares under the same terms. The final shares authorized by the Board in 2007 were purchased during the quarter ended March 29, 2008, and all shares remaining authorized for purchase at March 29, 2008 were authorized under the Board’s 2008 authorization.

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Item 6. Exhibits and Reports on Form 8-K


10.1		Employment Agreement by and between Joanne Townsend and the Company dated March 17, 2008.

10.2		2008 Management Bonus Plan.

10.3		Manufacturing Services Agreement between Jabil Circuit, Inc. and the Company dated May 30, 2007.

10.4		2005 Executive Deferred Compensation Plan as amended.

31.1		Rule 13a-14(a)/15d-14(a) Certification

31.2		Rule 13a-14(a)/15d-14(a) Certification

32.1		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

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


	ZEBRA TECHNOLOGIES CORPORATION

Date: April 30, 2008	By:	/s/ Anders Gustafsson
		Anders Gustafsson
		Chief Executive Officer

Date: April 30, 2008	By:	/s/ Charles R. Whitchurch
		Charles R. Whitchurch
		Chief Financial Officer

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Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the “ Agreement ”) is made and entered into by and between Zebra Technologies Corporation, a Delaware corporation (the “ Employer ”), and Joanne Townsend (the “ Executive ”), to be effective as of March 17, 2008 (the “ Effective Date ”).

RECITALS

A. The Employer wishes to employ the Executive, and the Executive desires to accept employment with the Employer.

B. The Employer and the Executive desire to enter into this agreement to delineate the terms and conditions of the Executive’s employment.

NOW, THEREFORE, in consideration of the above premises and the following mutual covenants and conditions, the parties agree as follows:

1. Employment . As of the Effective Date, the Executive hereby accepts employment on the following terms and conditions. The Employer shall employ the Executive as Vice President Human Resources of the Employer. The Executive understands and agrees that she is an at-will employee, and the Executive and the Employer can, and shall have the right to, terminate the employment relationship at any time for any or no reason, with or without notice, and with or without cause, subject to the payment provisions contained in Paragraph 7 of this Agreement. Nothing contained in this Agreement or any other agreement shall alter the at-will relationship.

2. Duties . The Executive shall work for the Employer in a full-time capacity. The Executive shall, during the term of her employment, have the duties, responsibilities, powers, and authority customarily associated with the position of an executive officer. The Executive shall solely report to, and follow the direction of, the Chief Executive Officer of the Employer or to his designee or a designee of the Board of Directors of the Company (the “ Board ”). The Executive shall diligently, competently, and faithfully perform all duties, and shall devote her entire business time, energy, attention, and skill to the performance of duties for the Employer or its affiliates and will use her best efforts to promote the interests of the Employer. It shall not be considered a violation of the foregoing for the Executive to serve on business, industry, civic, religious or charitable boards or committees, so long as such service is in compliance with the Employer’s Corporate Governance Guidelines, the Chief Executive Officer of the Employer is provided notice of such service and, in his reasonable determination, such service does not individually or in the aggregate significantly interfere with the performance of the Executive’s responsibilities as an employee of the Employer in accordance with this Agreement.

3. Executive Loyalty . Subject to the terms of this Agreement and the Corporate Governance Guidelines, the Executive shall devote all of her time, attention, knowledge, and

skill solely and exclusively to the business and interests of the Employer, and the Employer shall be entitled to all benefits and profits arising from or incident to any and all work, services, and advice of the Executive. The Executive expressly agrees that during the term of her employment, she shall not engage, directly or indirectly, as a partner, officer, director, member, manager, stockholder, supplier, advisor, agent, employee, or in any other form or capacity, in any other business similar to that of the Employer. The foregoing notwithstanding, and except as otherwise set forth in Paragraph 8, and provided that none of the following reflects poorly on the Employer or, in the reasonable determination of the Employer’s Chief Executive Officer, individually or in the aggregate significantly interferes with the performance of the Executive’s responsibilities as an employee of the Employer in accordance with this Agreement, nothing herein contained shall be deemed to prevent the Executive from (1) otherwise managing her personal investments and financial affairs, or (2) investing her money in the capital stock or other securities of any corporation whose stock or securities are publicly-owned or are regularly traded on any public exchange, so long as (a) the Executive does not beneficially own stock in any such corporation if more than five percent (5%) of the Employer’s annual sales are to such corporation or if the Employer’s products comprise more than five percent (5%) of such corporation’s annual sales, or (b) the Executive does not beneficially own more than one percent (1%) of the outstanding capital stock of any such corporation.

4. Compensation .

A. Base Salary . So long as the Executive is employed by the Employer, the Employer shall pay the Executive a gross base salary at an annual rate of $235,000 (the “ Base Salary ”), payable in substantially equal installments in accordance with the Employer’s payroll policy from time to time in effect. The Executive’s Base Salary shall be subject to any payroll or other deductions as may be required to be made pursuant to law, government order, or by agreement with, or consent of, the Executive. The Base Salary shall be reviewed at least annually, and may be increased or decreased from time to time as shall be determined by the Employer, and once such Base Salary shall have been increased or decreased, it shall thereafter be treated for all purposes of this Agreement as the Executive’s Base Salary. Unless specifically agreed to in writing by the Employer and the Executive, any increase or decrease in Base Salary shall not limit or reduce any other obligation of the Employer or the Executive under this Agreement.

B. Performance Bonus . The Executive shall be eligible to earn a performance bonus for calendar year 2008 under the Employer’s 2008 Management Bonus Plan (the “ Bonus ”) upon the attainment of certain performance measures. The Compensation Committee of the Board (the “ Compensation Committee ”) shall set the performance targets for a given year. The Bonus shall be targeted at forty percent (40%) of the Executive’s Base Salary (the “ Target Bonus ”), with the actual Bonus earned to be calculated on that portion of the Executive’s Base Salary actually earned during the calendar year for which the Bonus is calculated. The foregoing notwithstanding, and subject to the final sentence of this subparagraph B, as the Executive’s Bonus for 2008 performance, the Executive shall receive the greater of the Bonus earned under the 2008 Management Bonus Plan or 20% of the Executive’s Base Salary actually earned from the Employer for 2008. The Bonus, if any, for a given year (the “ Bonus Year ”) shall be paid in the following year and on or about March 15 of such year, provided, and except as otherwise set

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forth in Paragraph 7B, the Executive must be employed by the Employer and in good standing as of the date that the Bonus is paid to earn any Bonus for the Bonus Year.

C. Equity . The Executive shall be entitled to the following equity awards, which awards shall be granted under and pursuant to the terms of the 2006 Zebra Technologies Corporation Incentive Compensation Plan as may be amended from time to time (the “ 2006 Incentive Compensation Plan ”):

(1) An initial non-qualified stock option (the “ Initial Option ”) to purchase ten thousand (10,000) shares of the Employer’s common stock shall be granted on the Effective Date or as soon as practical thereafter (the “ Grant Date ”) and shall vest in four (4) substantially equal annual installments on each anniversary of the Grant Date, subject to the Executive’s continued employment with the Employer on each such anniversary date. The Initial Option shall be granted at an exercise price equal to the fair market value of a share of the Employer’s common stock as reported on The NASDAQ Stock Market as of the closing of such market on the Grant Date. Upon the date of such grant, the Employer shall provide the Executive with a Stock Option Agreement substantially in the form of attached Exhibit A , which shall describe the terms and conditions of the Initial Option grant consistent with this Agreement.

(2) A restricted stock grant for Six Thousand (6,000) shares of the Employer’s common stock (the “ Long-Term Incentive Restricted Stock Grant ”) shall be granted to the Executive on the Grant Date. The Long-Term Incentive Restricted Stock Grant shall vest as follows (the “ Long-Term Incentive Targets ”), but subject to the provisions contained in Paragraph 7B, only if the Executive is employed by the Employer at the time of vesting:

(a) twenty-five percent (25%) of the shares subject to the Long-Term Incentive Restricted Stock Grant shall vest if at any time during the period from the Grant Date and ending on September 4, 2012 (the “ Vesting Period ”) the average of the Total Shareholder Return (as hereinafter defined) measured over any forty-five (45) consecutive trading-days is at least sixty percent (60%); and

(b) the final seventy-five percent (75%) of the shares subject to the Long-Term Incentive Restricted Stock Grant shall vest if at any time during the Vesting Period the average of the Total Shareholder Return measured over any forty-five (45) consecutive trading-days, is at least one hundred percent (100%).

If the average of the Total Shareholder Return measured over any forty-five consecutive trading-day period is between sixty percent (60%) and one hundred percent (100%), then the Executive shall vest in the Long-Term Incentive Targets in the aggregate (which Vested Percentage shall include the 25% reflected in subparagraph (a), above), as follows:


Total Shareholder Return		Vested Percentage
65% but less than 70%		28.8%
70% but less than 75%		33.4%
75% but less than 80%		39.3%
80% but less than 85%		46.8%

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85% but less than 90%		56.2%
90% but less than 95%		68.4%
95% but less than 100%		83.8%

Subject to the provisions contained in Paragraph 7B, any shares which are unvested at the expiration of the Vesting Period as a result of the failure to attain the Long-Term Incentive Targets shall be forfeited.

For purposes of this Agreement, “ Total Shareholder Return ” shall be calculated pursuant to the following formula:

(The fair market value of a share of the Employer’s common stock as reported on The NASDAQ Stock Market as of the close of business on any particular date—the Effective Date Stock Price) + Dividends

Effective Date Stock Price.

For purposes of this Agreement, “ Effective Date Stock Price ” shall mean $36.80.

To prevent dilution or enlargement of the Total Shareholder Return, the Compensation Committee shall make or authorize to be made an adjustment to the foregoing formula for Total Shareholder Return to prevent dilution or enlargement of the Total Shareholder Return, as a result of the following: (1) any adjustment, recapitalization, reorganization or other changes in the Employer’s capital structure or its business; (2) any merger or consolidation of the Employer (other than a Change in Control); (3) any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Employer’s common stock or the rights thereof; (4) the dissolution or liquidation of the Employer; (5) any sale or transfer of all or any part of the Employer’s assets or business; or (6) any other corporate act or proceeding, whether of a similar character or otherwise.

Upon the date of the Long Term Incentive Restricted Stock Grant, the Employer shall provide the Executive with a Restricted Stock Agreement substantially in the form of attached Exhibit B , which shall describe the terms and conditions of such grants consistent with this Agreement.

D. Employee Benefits . During the term of the Executive’s employment, the Employer shall:

(3) include the Executive in any life insurance, disability insurance, medical, dental or health insurance, vacation (of four (4) weeks in each calendar year, which shall in all instances cease accruing beyond a cap of four (4) weeks of accrued but unused vacation, until said accrued but unused vacation bank drops below a four (4) weeks total), savings, pension and retirement plans and other benefit plans or programs (including, if applicable, any excess benefit or supplemental executive retirement plans) maintained by the Employer for the benefit of its executive officers; and

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(4) include the Executive in such perquisites as the Employer may establish from time to time that are commensurate with her position and at least comparable to those received by other executive officers of the Employer.

Nothing in this Agreement shall be construed to limit, condition, or otherwise encumber the rights of the Employer, in its sole discretion, to amend, discontinue, substitute or maintain any benefit plan, program, or perquisite.

E. One-Time Sign-On Bonus . The Executive shall receive a one-time, lump sum sign-on bonus in the gross amount of $25,000 (the “ Sign-On Bonus ”) upon her signing this Agreement and commencing her employment on the Effective Date. If the Executive’s employment with the Employer ends for any reason other than termination by the Company without Cause (as defined in subparagraph 6B) or by the Executive for Good Reason (as defined in subparagraph 6D), the Executive shall be obligated immediately to repay to the Employer the full amount of the Sign-On Bonus.

5. Expenses . While employed by the Employer, the Executive shall be entitled to receive prompt reimbursement for all reasonable and necessary business expenses incurred by the Executive, in accordance with the practices and policies applicable to other executive officers of the Employer, including professional and service company dues, journal subscriptions, educational seminars, conferences, and symposiums and as required by the Internal Revenue Service to qualify as ordinary and necessary business expenses under the Internal Revenue Code of 1986, as amended (the “ Code ”). The Executive shall be entitled to receive prompt reimbursement for travel expenses incurred in connection with the performance of her duties under this Agreement. To receive reimbursement, the Executive shall submit to the Employer such vouchers or expense statements that reasonably evidence expenses incurred in accordance with the Employer’s travel and expense reimbursement policy.

6. Termination . The Executive’s services shall terminate upon the first to occur of the following events:

A. Death or Disability . Upon the Executive’s date of death or the date the Executive is given written notice that she has been determined to be disabled by the Employer. For purposes of this Agreement, the Executive shall be deemed to be disabled if the Executive, as a result of illness or incapacity, shall be unable to perform substantially her required duties for a period of one hundred eighty (180) consecutive days; provided, however, that if the Executive, after being unable to perform substantially her required duties for a period of less than one hundred eighty (180) consecutive days as a result of illness or incapacity returns to active duty for less than thirty (30) days, the period of such active duty will be disregarded in determining whether the 180 consecutive day threshold has been accumulated (although it will not be accumulated as part of the 180 day period). A termination of the Executive’s employment by the Employer for disability shall be communicated to the Executive by written notice and shall be effective on the tenth (10th) business day after receipt of such notice by the Executive, unless the Executive returns to full-time performance of her duties before such tenth (10th) business day.

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B. Cause Termination . On the date the Chief Executive Officer or his designee provides the Executive with written notice that she is being terminated for Cause. For purposes of this Agreement, and as determined by the Chief Executive Officer or his designee in his sole discretion, the Executive shall be deemed terminated for “ Cause ” if the Chief Executive Officer or his designee terminates the Executive after the Executive:

(1) shall have committed, been indicted of, or been convicted of, or admitted, plea bargained, entered a plea of no contest or nolo contendere to, any felony of any kind or a misdemeanor, or violated any laws, involving fraud, dishonesty or an act of moral turpitude;

(2) shall have materially breached this Agreement or any other agreement to which the Executive and the Employer are parties;

(3) shall have materially violated any written Employer policy, regardless of whether within or outside the scope of her authority;

(4) shall have committed willful or intentional misconduct, gross negligence, or dishonest, fraudulent or unethical behavior, or other conduct involving serious moral turpitude in the performance of her duties hereunder;

(5) shall have failed or refused to materially comply (to the best of her ability) with a specific direction of the Employer, unless the Executive reasonably and in good faith believes such specific direction to be unlawful (in which case the Employer’s termination of the Executive’s employment shall not be for Cause under this provision); or

(6) engages in any conduct which breaches her fiduciary duty to the Employer, which materially injures the integrity, character or reputation of the Employer or which impugns Executive’s own integrity, character or reputation so as to cause Executive to be unfit to act in the capacity of an executive officer of the Employer.

A termination of employment by the Employer for Cause under subparagraphs 6B(2), (3), (4), (5) or (6) shall be effectuated by the Chief Executive Officer or his designee giving the Executive written notice of the termination within thirty (30) days of the event constituting Cause, or such longer period as the parties may agree, setting forth in reasonable detail the specific conduct of the Executive that constitutes Cause, the specific provisions of this Agreement on which the Employer relies and, to the extent such Cause is susceptible to cure, providing the Executive with a thirty (30) day cure period. If such Cause is susceptible to cure and the Executive fails to remedy the condition within such thirty (30) day cure period, the Employer may terminate the Executive’s employment within thirty (30) days after the expiration of the cure period, and if the Employer fails to so terminate the Executive’s employment, any subsequent termination based upon the same underlying facts shall not constitute a termination for Cause under this subparagraph 6B.

C. Employer Termination . On the date the Employer terminates the Executive’s employment for any reason, other than a reason otherwise set forth in this Paragraph 6.

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D. Good Reason Termination . On the date the Executive terminates her employment for Good Reason. The term “ Good Reason ” means the occurrence of any one of the following:

(1) demotion of the Executive by the Employer to a non-executive officer position (including a material diminution in the status of the Executive’s responsibilities, authorities, powers or duties taken as a whole) or assignment to the Executive of any duties materially inconsistent with her position, status or responsibilities under this Agreement;

(2) material breach of any provision of this Agreement by the Employer; or

(3) decrease in Base Salary as in effect on the Effective Date in an amount equal to or greater than ten percent (10%) (unless such decrease is applied on a proportionally equal basis to all executive officers of the Employer) (an “ Applicable Decrease ”), but only if the Executive terminates her employment with the Employer as a result of an Applicable Decrease within fifteen (15) business days of the later of (i) the effective date of the Applicable Decrease, or (ii) the Executive’s actual knowledge of Applicable Decrease (“ Applicable Decrease Date ”). For clarification purposes, should the Executive fail to terminate her employment with the Employer within fifteen (15) business days of the Applicable Decrease Date, such termination shall not constitute termination of employment by the Executive for Good Reason under this provision.

A termination of employment by the Executive for Good Reason under subparagraph 6D(1) or (2) shall be effectuated by giving the Employer written notice of the termination within thirty (30) days of the event constituting Good Reason, setting forth in reasonable detail the specific conduct of the Employer that constitutes Good Reason and the specific provisions of this Agreement on which Executive relies and providing the Employer with a thirty (30) day period during which it may remedy the condition constituting Good Reason. If the Employer fails to remedy the condition within such thirty (30) day period, the Executive must terminate her employment within thirty (30) days after the expiration of the cure period, and if the Executive fails to so terminate her employment, any subsequent termination based upon the same underlying facts shall not constitute a termination for Good Reason under this subparagraph 6D.

E. Resignation . On the date the Executive terminates her employment for any reason (other than Good Reason), provided that the Executive shall give the Chief Executive Officer sixty (60) days written notice prior to such date of her intention to terminate such employment. The Chief Executive Officer or his designee may, in its sole discretion, waive such sixty (60) day notice requirement.

7. Compensation Upon Termination .

A. Final Payments . If the Executive’s services are terminated pursuant to Paragraph 6, the Executive shall be entitled to her salary through her final date of active employment plus any accrued but unused vacation pay. The Executive also shall be entitled to any benefits mandated under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“ COBRA ”) or required under the terms of any death, insurance, or retirement plan, program, or agreement provided by the Employer and to which the Executive is a party or in which the

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Executive is a participant, including, but not limited to, any short-term or long-term disability plan or program, if applicable.

B. Severance Benefits .

(1) In addition to the salary and benefits described in Paragraph 7A, if the Executive’s employment is terminated pursuant to Paragraphs 6C or 6D, the Executive shall be entitled to the following: (i) the continuation of her Base Salary at the annual salary rate then in effect (before any reduction under Paragraph 6D(3) which is made on a proportionally equal basis to all executive officers and which is made within the one (1) year period preceding the date the Executive’s employment is terminated), for a period of one year following the termination of the Executive’s employment (the “ Severance Period ”), payable in accordance with the Employer’s payroll policy from time to time in effect and subject to the limitations imposed under subparagraph 7B(3); (ii) a pro-rata portion of the Bonus for the year in which the Executive’s employment terminates, if such Bonus would have been earned had the Executive been employed and in good standing as of the date the Bonus otherwise is paid to other senior level executive of the Employer, and payable at the time the Bonus otherwise is paid to other senior level executives of the Employer; (iii) the Bonus attributable to the calendar year prior to the calendar year in which the Executive’s employment terminates, if such Bonus would have been earned had the Executive been employed and in good standing as of the date the Bonus otherwise is paid to other senior level executive of the Employer, and provided such Bonus had not yet been paid in accordance with the timing provisions set forth in Paragraph 4B, and payable at the time the Bonus otherwise is paid to other senior level executives of the Employer; (iv) a payment equal to one hundred percent (100%) of the Target Bonus (before any reduction under Paragraph 6D(3) which is made on a proportionally equal basis to all executive officers and which is made within the one (1) year period preceding the date the Executive’s employment is terminated), based upon the Base Salary for such year, to be paid at the same time that performance bonuses are generally paid by the Employer to its executives for the year in which such termination occurs; (v) equity compensation, if any, subject to the terms of the Executive’s award agreement; (vi) professional outplacement services by a company selected by, and paid by, the Employer within one (1) year after the date of termination, in an amount not to exceed $32,000; and (vii) continued coverage of the Executive and her dependents in the medical and dental insurance plans sponsored by the Employer, as mandated by COBRA, which may continue to the extent required by applicable law and the Employer shall pay for such coverage, at the same rate the Employer pays for health insurance coverage for its active employees under its group health plan (with the Executive required to pay for any employee-paid portion of such coverage), through the earlier of (a) the last day of the Severance Period or (b) the date the Executive becomes eligible for coverage under another group health plan that does not impose preexisting condition limitations on the Executive’s coverage, provided, however, that nothing herein shall be construed to extend the period of time over which such COBRA continuation coverage may be provided to the Executive and her dependents beyond that mandated by law and, provided further, that the Executive shall be required to pay the entire cost of such COBRA continuation coverage for any time following the last day of the Severance Period.

(2) The foregoing notwithstanding, if at any time within one hundred twenty (120) days immediately preceding or one (1) year immediately following a “Change in Control,” the

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Executive’s employment is terminated pursuant to Paragraph 6C or 6D, the Executive shall be entitled to the following compensation, in lieu of any payments otherwise set forth in Paragraph 7B(1) above, and payable within sixty (60) days following the later of the Change in Control or the termination, subject, however, to the limitations imposed under subparagraph 7B(3): two (2.0) times the Executive’s Base Salary at the annual rate then in effect (before any reduction under Paragraph 6D(3) which is made on a proportionally equal basis to all executive officers and which is made within the one (1) year period preceding the date the Executive’s employment is terminated) and two (2.0) times the Target Bonus (before any reduction under Paragraph 6D(3) which is made on a proportionally equal basis to all executive officers and which is made within the one (1) year period preceding the date the Executive’s employment is terminated), based upon the Base Salary for such year. In addition, upon the termination of the Executive’s employment as set forth in this subparagraph 7B(2) the Executive and her dependents shall be offered continued coverage under the Employer’s group health plan for the duration of the COBRA continuation period on the same financial terms as described above in subparagraph 7B(1)(vii) and shall also be entitled to the compensation and benefits, if any, set forth in subparagraphs 7B(1)(ii), (iii), (v) and (vi), above.

(3) Notwithstanding the foregoing, if the Executive is a “specified employee” as such term is defined under Section 409A of the Code and the regulations and guidance promulgated thereunder, any payments described in this Paragraph 7B shall be delayed for a period of six (6) months following the Executive’s separation of employment to the extent and up to an amount necessary to ensure such payments are not subject to the penalties and interest under Section 409A of the Code. The payments to be made under this Paragraph 7B shall be further conditioned upon the Executive’s execution of an agreement acceptable to the Employer that (i) waives any rights the Executive may otherwise have against the Employer, and (ii) releases the Employer from actions, suits, claims, proceedings and demands related to the period of employment and/or the termination of employment. For purposes of this Paragraph 7B, “ Change in Control ” shall be as defined under the 2006 Incentive Compensation Plan, as in effect on the date hereof, which definition is incorporated herein by reference; provided, however, the definition of Change in Control as set forth herein is not intended to be broader than the definition of a “change in control event” as defined by reference to the regulations under Section 409A of the Code, and the payments described in Paragraph 7B(2) shall not be payable unless the applicable Change in Control constitutes a change in control event in accordance with Section 409A of the Code and the regulations and guidance promulgated thereunder.

C. Excise Tax . If it shall be determined that any payment to the Executive pursuant to this Agreement or any other payment or benefit from the Employer, any affiliate, any shareholder of the Employer or any other person would be subject to the excise tax imposed by Section 4999 of the Code because such payment equals or exceeds three times the “ Base Amount ” (as defined under Section 280G of the Code) by an amount in excess of ten percent (10%) of such three times the Base Amount, then the Executive shall receive a Tax Gross-Up Payment (as defined below) with respect to all such excise taxes. “ Tax Gross-Up Payment ” means an amount payable to the Executive such that, after payment of Taxes (as defined below) on such amount there remains a balance sufficient to pay the Taxes being reimbursed. “ Taxes” means the incremental United States federal, state and local income, excise and other taxes

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payable by the Executive with respect to any applicable item of income. If it shall be determined that any payment to the Executive pursuant to this Agreement or any other payment or benefit from the Employer, any affiliate, any shareholder of the Employer or any other person would be subject to the excise tax imposed by Section 4999 of the Code because such payment exceeds three times the Base Amount by an amount equal to ten percent (10%) or less of such three times the Base Amount, then the amount of any payments hereunder which shall be paid to the Executive shall be reduced to an amount equal to one dollar less than three times the Base Amount.

8. Restrictive Covenants .

A. Confidentiality .

(1) Confidential Information . The Executive understands that the Employer possesses Confidential Information which is important to its business, the Employer devotes significant financial, human and other resources to the development of its products, its customer base and the general goodwill associated with its business and the Employer diligently maintains the secrecy and confidentiality of its Confidential Information. For purposes of this Agreement, Confidential Information is information that was or will be developed, created, or discovered by or on behalf of the Employer, or which became or will become known by, or was or is conveyed to the Employer, which has commercial value in the Employer’s business. “ Confidential Information ” means any and all financial, technical, commercial or other information concerning the business and affairs of the Employer that is confidential and proprietary to the Employer, including without limitation, (i) information relating to the Employer’s past and existing customers and vendors and development of prospective customers and vendors, including specific customer product requirements, pricing arrangements, payment terms, customer lists and other similar information; (ii) inventions, designs, methods, discoveries, works of authorship, creations, improvements or ideas developed or otherwise produced, acquired or used by the Employer; (iii) the Employer’s proprietary programs, processes or software, consisting of but not limited to, computer programs in source or object code and all related documentation and training materials, including all upgrades, updates, improvements, derivatives and modifications thereof and including programs and documentation in incomplete stages of design or research and development; (iv) the subject matter of the Employer’s patents, design patents, copyrights, trade secrets, trademarks, service marks, trade names, trade dress, manuals, operating instructions, training materials, and other industrial property, including such information in incomplete stages of design or research and development; and (v) other confidential and proprietary information or documents relating to the Employer’s products, business and marketing plans and techniques, sales and distribution networks and any other information or documents which the Employer reasonably regards as being confidential.

(2) Employer Materials . Executive understands that the Employer possesses or will possess Employer Materials which are important to its business. For purposes of this Agreement, “ Employer Materials ” are documents or other media or tangible items that contain or embody Confidential Information or any other information concerning the business, operations or future/strategic plans of the Employer, whether such documents have been prepared by the Executive or by others.

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(3) Treatment of Confidential Information and Employer Property . In consideration of the Executive’s employment by the Employer, the compensation received by the Executive from the Employer, and the Employer’s agreement to give Executive access to certain Confidential Information, the Executive agrees as follows:

(a) All Confidential Information and trade secret rights, and other intellectual property and rights (collectively “ Rights ”) in connection therewith will be the sole property of the Employer. At all times, both during the Executive’s employment by the Employer and after its termination for any reason, Executive will keep in confidence and trust and will not use or disclose any Confidential Information or anything relating to it without the prior written consent of the Chief Executive Officer or his designee, except as may be necessary and appropriate in the ordinary course of performing the Executive’s duties to the Employer.

(b) All Employer Materials will be the sole property of the Employer. The Executive agrees that during the Executive’s employment by the Employer, the Executive will not remove any Employer Materials from the business premises of the Employer or deliver any Employer Materials to any person or entity outside the Employer, except in connection with performing the duties of her employment. The Executive further agrees that, immediately upon the termination of the Executive’s employment by the Executive or by the Employer for any reason, or during the Executive’s employment if so requested by the Employer, the Executive will return all Employer Materials, apparatus, equipment and other physical property, or any reproduction of such property, excepting only the Executive’s copy of this Agreement.

B. Noncompetition and Nonsolicitation . While employed by the Employer and for a period of twenty-four (24) consecutive months following the date of termination of employment for any reason, the Executive will not directly or indirectly:

(1) Contact, solicit, interfere with or divert any of the Employer’s customers;

(2) Accept employment or engage in a competing business, or engage in any activity that may result in the disclosure, divulging or otherwise use of Confidential Information acquired during Executive’s employment with the Employer; and

(3) Solicit any person who is employed by the Employer for the purpose of encouraging that employee to join the Executive as a partner, agent, employee, contractor or otherwise in any business activity.

In the event of any breach of this subparagraph B, the Executive agrees that the twenty-four (24) month restricted period shall be tolled during the time of such breach.

C. Nondisparagement . While employed by the Employer and indefinitely thereafter, the Executive shall refrain from (1) making any false statement about the Employer, and (2) all conduct, verbal or otherwise, that disparages or damages or could disparage or damage the reputation, goodwill, or standing in the community of the Employer or any of its subsidiaries, affiliates, or parents or any of their officers, directors, employees and stockholders, or that could have a deleterious effect upon the Employer’s or any of its subsidiaries’, affiliates’, or parents’

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business, provided, however, that nothing contained in this Paragraph 8C or any other paragraph of this Agreement shall preclude the Executive from making any statement in good faith that is required by law or order of any court or regulatory commission.

D. Forfeitures . In the event that the Executive breaches any of the restrictions in this Paragraph 8, she shall forfeit all of the applicable payments and benefits under this Agreement, including but not limited to such payments and benefits pursuant to Paragraph 7, and the Employer shall have the right to recapture and seek repayment of any such applicable payments and benefits under this Agreement. The Employer and the Executive acknowledge that the remedy set forth hereunder is not to be considered a form of liquidated damages and the forfeiture, recapture or repayment shall not be the exclusive remedy hereunder.

E. Intellectual Property . The Employer has adopted a policy on Inventions intended to encourage research and inventions by its executives, to appraise and determine relative rights and equities of all parties concerned, to facilitate patent applications, licensing, and the generation of royalties, if any, and to provide a uniform procedure in patent matters when the Employer has a right or equity. “ Inventions ” includes all improvements, inventions, designs, formulas, works of authorship, trade secrets, technology, computer programs, compositions, ideas, processes, techniques, know-how and data, whether or not patentable, made or conceived or reduced to practice or developed by the Executive, either alone or jointly with others, during the term of the Executive’s employment, including during any period prior to the date of this Agreement.

(1) Ownership and Assignment . Except as defined in this Agreement, all Inventions which the Executive makes, conceives, reduces to practice or develops (in whole or in part, either alone or jointly with others) during her employment will be the sole property of the Employer to the maximum extent permitted by law. The Executive agrees to assign such Inventions and all Rights in them to the Employer. Exemptions from this Agreement to assign may be authorized in those circumstances where the mission of the Employer is better served by such action, provided that overriding obligations to other parties are met and such exemptions are not inconsistent with other Employer policies. Further, the Executive may petition the Employer for license to make, market or sell a particular Invention. The Employer may release patent rights to the inventor in those circumstances when:

(a) the Employer provides the Executive with notification in writing that it elects not to file a patent application and the inventor is prepared to do so at her expense, or

(b) at the Employer’s discretion, the equity of the situation indicates that such release should be given, provided in either case that no further research or development to develop that invention will be conducted involving Employer support or facilities, and provided further that a shop right is granted to the Employer and, at the Employer’s discretion, the Employer shall have a royalty-free, assignable license to the Invention and any intellectual property rights related to it.

The provisions of Paragraph 8E(1) do not apply to an Invention for which no equipment, supplies, facility, or trade secret information of the Employer was used and which was developed entirely on the Executive’s own time, unless (a) the Invention relates (1) to the business of the

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Employer, or (2) to the Employer’s actual or demonstrably anticipated research or development, or (b) the Invention results from any work performed by the Executive for the Employer.

(2) Disclosure to the Employer . The Executive promptly will disclose in writing to the Chief Executive Officer, with a copy to the General Counsel of the Employer, all Inventions. The Executive also will disclose to the General Counsel of the Employer all things that would be Inventions if made during the term of the Executive’s employment, conceived, reduced to practice, or developed by the Executive within six months after the termination of her employment with the Employer, unless the Executive can demonstrate that the Invention has been conceived and first reduced to practice by the Executive following the termination of her employment with the Employer. Such disclosures will be received by the Employer in confidence (to the extent they are not assigned in this Paragraph and do not extend the assignment made in this Paragraph.) The Executive will not disclose Inventions to any person outside the Employer unless requested to do so by the Chief Executive Officer or the General Counsel of the Employer.

(3) Assistance with Rights . The Executive agrees to perform, during and after employment, all acts deemed necessary or desirable by the Employer to permit and assist it, at the Employer’s expense, in obtaining, maintaining, defending and enforcing Rights with respect to such Inventions and improvements in any and all countries. Such acts may include, but are not limited to, execution of documents and assistance or cooperation in legal proceedings. The Executive agrees to execute such declarations, assignments, or other documents as may be necessary in the course of Invention evaluation, patent prosecution, or protection of patent or analogous property rights, to assure that title in such Inventions will be held by the Employer or by such other parties designated by the Employer as may be appropriate under the circumstances. The Executive irrevocably designates and appoints the Employer and its duly authorized officers and agents, as her agents and attorneys-in-fact to act for and on the Executive’s behalf and instead of the Executive, to execute and file any documents and to do all other lawfully permitted acts to further the above purposes with the same legal force and effect as if executed by the Executive.

(4) Moral Rights . Any assignment of copyright pursuant to this Agreement includes all rights of paternity, integrity, disclosure and withdrawal and any other rights that may be known as or referred to as “moral rights” (collectively “ Moral Rights ”). To the extent such Moral Rights cannot be assigned under applicable law and to the extent the following is allowed by the laws in the various countries where Moral Rights exist, Executive hereby waives such Moral Rights and consents to any action of the Employer that would violate such Moral Rights in the absence of such consent. The Executive will confirm any such waivers and consents from time to time as requested by the Employer.

F. No Conflicts . The execution and delivery of this Agreement by the Executive does not conflict with, or result in a breach of or constitute a default under, any agreement or contract, whether oral or written, to which the Executive is a party or by which the Executive may be bound. In addition, the Executive has informed the Employer of, and provided the Employer with copies of, any non-competition, confidentiality, work-for-hire or similar agreements to which the Executive is subject or may be bound.

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G. Disclosure . The Executive acknowledges and agrees that the scope described above is necessary and reasonable in order to protect the Employer in the conduct of its business and that, if the Executive becomes employed by another employer, she shall be required to disclose the existence of this Paragraph 8 to such employer and the Executive hereby consents to and the Employer is hereby given permission to disclose the existence of this Paragraph 8 to such employer.

H. Market Information . The Executive acknowledges that she may become aware of “material” nonpublic information relating to the Employer’s vendors, suppliers, alliance and/or joint venture partners, customers, or competitors (each, a “ Business Partner ”) whose stocks are publicly traded. The Executive acknowledges that she is prohibited by law as well as by Employer policy from trading in the shares of such Business Partners while in possession of such information or directly or indirectly disclosing such information to any other persons so that they may trade in these shares. For purposes of this Paragraph H, “material” information may include any information, positive or negative, which might be of significance to an investor in determining whether to purchase, sell or hold the stock of publicly traded customers. Information may be significant for this purpose even if it would not alone determine the investor’s decision. Examples include a potential business acquisition, internal financial information that departs in any way from what the market would expect, the acquisition or loss of a major contract, or an important financing transaction.

I. Unauthorized Material . The Employer does not wish to incorporate any unlicensed or unauthorized material into its products or services or those of its subsidiaries. Therefore, the Executive agrees that she will not knowingly disclose to the Employer, use in the Employer’s business, or cause the Employer to use, any information or material which is confidential or proprietary to any third party including, but not limited to, any former employer, competitor or client, unless the Employer has a right to receive and use such information. The Executive will not incorporate into her work any material which is subject to the copyrights of any third party unless the Employer has a written agreement with such third party or otherwise has the right to receive and use such information.

J. Injunctive Relief . It is agreed that any breach or anticipated or threatened breach of any of the Executive’s covenants contained in this Paragraph 8 will result in irreparable harm and continuing damages to the Employer and its business and that the Employer’s remedy at law for any such breach or anticipated or threatened breach will be inadequate and, accordingly, in addition to any and all other remedies that may be available to the Employer at law or in equity in such event, any court of competent jurisdiction may issue a decree of specific performance or issue a temporary and permanent injunction, without the necessity of the Employer posting bond or furnishing other security and without proving special damages or irreparable injury, enjoining and restricting the breach, or threatened breach, of any such covenant, including, but not limited to, any injunction restraining the Executive from disclosing, in whole or part, any Confidential Information. The Executive further agrees to pay all of the Employer’s costs and expenses, including reasonable attorneys’ and accountants’ fees, incurred in successfully enforcing such covenants.

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9. Notices . Any and all notices required in connection with this Agreement shall be deemed adequately given only if in writing and (a) personally delivered, or sent by first class, registered or certified mail, postage prepaid, return receipt requested, or by recognized overnight courier, (b) sent by facsimile, provided a hard copy is mailed on that date to the party for whom such notices are intended, or (c) sent by other means at least as fast and reliable as first class mail. A written notice shall be deemed to have been given to the recipient party on the earlier of (a) the date it shall be delivered to the address required by this Agreement; (b) the date delivery shall have been refused at the address required by this Agreement; (c) with respect to notices sent by mail or overnight courier, the date as of which the Postal Service or overnight courier, as the case may be, shall have indicated such notice to be undeliverable at the address required by this Agreement; or (d) with respect to a facsimile, the date on which the facsimile is sent and receipt of which is confirmed. Any and all notices referred to in this Agreement, or which either party desires to give to the other, shall be addressed to her residence in the case of the Executive, or, if to the Employer, to:

Vice President, General Counsel and Secretary

Zebra Technologies Corporation

333 Corporate Woods Parkway

Vernon Hills, IL 60061

Either party may from time to time designate a new address by notice given in accordance with this Paragraph 9.

10. Waiver of Breach. A waiver by either party of a breach of any provision of this Agreement by the other party shall not operate or be construed as a waiver or estoppel of any subsequent breach by such other party. No waiver shall be valid unless in writing and signed by an authorized officer of the Employer or by the Executive, as the case may be.

11. Assignment . The Executive acknowledges that the services to be rendered by her are unique and personal. Accordingly, the Executive may not assign any of her duties or obligations under this Agreement. This Agreement shall be binding upon and inure to the benefit of the Executive, her estate and beneficiaries. The rights and obligations of the Employer under this Agreement shall inure to the benefit of and shall be binding upon the successors and assigns of the Employer.

12. Entire Agreement . This Agreement, together with the agreements referred to herein, sets forth the entire and final agreement and understanding of the parties and contains all of the agreements made between the parties with respect to the subject matter hereof. This Agreement supersedes the Prior Agreements and any and all other agreements, either oral or in writing, between the parties hereto, with respect to the subject matter hereof. No change or modification of this Agreement shall be valid unless in writing and signed by the Employer and the Executive.

13. Severability . If any provision of this Agreement shall be found invalid or unenforceable for any reason, in whole or in part, then such provision shall be deemed modified, restricted, or reformulated to the extent and in the manner necessary to render the same valid and

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enforceable, or shall be deemed excised from this Agreement, as the case may require, and this Agreement shall be construed and enforced to the maximum extent permitted by law, as if such provision had been originally incorporated herein as so modified, restricted, or reformulated or as if such provision had not been originally incorporated herein, as the case may be. The parties further agree to seek a lawful substitute for any provision found to be unlawful; provided, that, if the parties are unable to agree upon a lawful substitute, the parties desire and request that a court or other authority called upon to decide the enforceability of this Agreement modify those restrictions in this Agreement that, once modified, will result in an agreement that is enforceable to the maximum extent permitted by the law in existence at the time of the requested enforcement.

14. Headings . The headings in this Agreement are inserted for convenience only and are not to be considered a construction of the provisions hereof.

15. Execution of Agreement . This Agreement may be executed in several counterparts, each of which shall be considered an original, but which when taken together, shall constitute one agreement.

16. Recitals . The recitals to this Agreement are incorporated herein as an integral part hereof and shall be considered as substantive and not precatory language.

17. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Illinois, without reference to its conflict of law provisions. Furthermore, the Executive agrees and consents to submit to personal jurisdiction in the state of Illinois in any state or federal court of competent subject matter jurisdiction situated in Lake or Cook County, Illinois. The Executive further agrees that the sole and exclusive venue for any suit arising out of, or seeking to enforce, the terms of this Agreement shall be in a state or federal court of competent subject matter jurisdiction situated in Lake or Cook County, Illinois. In addition, the Executive waives any right to challenge in another court any judgment entered by such Lake or Cook County court or to assert that any action instituted by the Employer in any such court is in the improper venue or should be transferred to a more convenient forum . Further, the Executive waives any right she may otherwise have to a trial by jury in any action to enforce the terms of this Agreement.

18. Indemnification. The Employer shall obtain and maintain for the Executive directors’ and officers’ liability insurance coverage and shall indemnify the Executive to the extent permitted under the Employer’s By-Laws and/or Certificate of Incorporation.

19. No Mitigation. The Executive shall have no obligation or duty to seek subsequent employment or engagement as an employee (including self-employment) or as a consultant or otherwise mitigate the Employer’s obligation under this Agreement. Payments and benefits due under Paragraph 7 of this Agreement shall not be reduced by any compensation earned by the Executive as an employee or consultant from any employment or consulting arrangement after the Executive’s termination of employment.

IN WITNESS WHEREOF , the parties have set their signatures on the date set forth below.

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ZEBRA TECHNOLOGIES CORPORATION:		EXECUTIVE:

By:	/s/Anders Gustafsson	/s/ Joanne Townsend
	Anders Gustafsson, CEO	Joanne Townsend

Date signed: March 17, 2008		Date signed: March 17, 2008

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EXHIBIT A

Form of

N ON -Q UALIFIED S TOCK O PTION A GREEMENT

This NON-QUALIFIED STOCK OPTION AGREEMENT (this “Option Agreement”), dated as of <<Grant Date>> (the “Grant Date”), is between ZEBRA TECHNOLOGIES CORPORATION, a Delaware corporation (the “Company”), and Joanne Townsend (the “Participant”), relating to a non-qualified stock option granted under the 2006 Zebra Technologies Corporation Incentive Compensation Plan (the “Plan”). Capitalized terms used in this Option Agreement without definition shall have the meanings ascribed to such terms in the Plan.

Grant of Option.

Grant. Subject to the provisions of this Option Agreement and pursuant to the provisions of the Plan, the Company hereby grants to the Participant as of the Grant Date a Non-Qualified Stock Option (the “Option”) to purchase 10,000 shares (the “Option Shares”) of the Company’s Class A Common Stock, $.01 par value per share (the “Stock”), at a price of <<Strike Price>> per share (the “Option Price”).

Term of the Option. Unless the Option terminates earlier pursuant to other provisions of the Option Agreement, the Option shall expire on the tenth anniversary of the Grant Date (the “Expiration Date”).

Nontransferability. The Option shall be non-transferable, except by will or the laws of descent and distribution, or as otherwise permitted under the Plan.

Vesting of Option.

General Vesting Rule. Prior to the Expiration Date, the Option shall become and be exercisable as follows:


Grant Date Anniversary		Percentage of Option Exercisable
Prior to the first anniversary of the Grant Date		0%
On or after the first anniversary of the Grant Date		25%
On or after the second anniversary of the Grant Date, an additional		25%
On or after the third anniversary of the Grant Date, an additional		25%
On or after the fourth anniversary of the Grant Date, an additional		25%

provided, however, except as otherwise provided for under this Option Agreement, the Participant must remain employed by the Company or any Subsidiary continuously through the applicable vesting dates.

Death or Disability. Notwithstanding the provisions of Section 2(a) hereof, in the event the Participant’s employment with the Company and/or any Subsidiary is terminated due to death or Disability, any unvested Option Shares as of the date of the Participant’s

termination of employment shall immediately become fully vested and exercisable and, along with unexercised vested Option Shares, shall remain exercisable until the earlier of:

(i)

the Expiration Date; or

(ii)

one (1) year after the date of the Participant’s termination of employment due to death or Disability.

In the event of the Participant’s death, the Participant’s beneficiary or estate may exercise the vested Option Shares.

Retirement. In the event the Participant’s employment with the Company and/or any Subsidiary is terminated due to Retirement, any unexercised, vested Option Shares as of the date of Participant’s termination of employment shall remain exercisable until the earlier of:

(i)

the Expiration Date; or

(ii)

one (1) year after the date of the Participant’s termination of employment due to Retirement.

For purposes of this Option Agreement, “Retirement” means the Participant’s voluntary termination of employment with the Company and/or any Subsidiary after attaining either:

•

age 55 with ten (10) complete years of service or more with the Company and/or any Subsidiary; or

•

age 65.

Termination for Cause. In the event the Participant’s employment with the Company and/or any Subsidiary is terminated for Cause, all unvested Option Shares and all unexercised, vested Option Shares shall expire immediately, be forfeited and considered null and void. For purposes of this Option Agreement, “Cause” means, as determined by the Company, in its sole discretion, termination of the Participant’s employment with the Company or any Subsidiary because of:

(i)

the Participant’s material breach of this Option Agreement or of any other agreement to which the Participant and the Company are parties, as determined by the Committee in good faith; or

(ii)

material violation of Company policy, regardless of whether within or outside of his or her authority; or

(iii)

willful or intentional misconduct; gross negligence; or dishonest, fraudulent, or unethical behavior; or other conduct involving serious moral turpitude, by Participant in the performance of his or her duties; or

(iv)

dishonesty, theft or conviction of any crime or offense involving money or property of the Company or any Subsidiary; or

(v)

breach of any fiduciary duty owing to the Company or any Subsidiary

(vi)

unauthorized disclosure of Confidential Information or unauthorized dissemination of Company Materials; or

(vii)

conduct that is, or could reasonably be expected to be, materially harmful to the Company or any of its subsidiaries or affiliates, as determined by the Committee in good faith.

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Other Termination of Employment. In the event the Participant’s employment with the Company and/or any Subsidiary is terminated for any reason other than as provided in Sections 2(b), (c) or (d) hereof, any unexercised, vested Option Shares as of the date of Participant’s termination of employment shall remain exercisable until the earlier of:

(i)

the Expiration Date; or

(ii)

ninety (90) days after the date of the Participant’s involuntary (as to the Participant) termination of employment for reasons other than death, Disability, Retirement, or Cause; or

(iii)

thirty (30) days after the date of the Participant’s voluntary termination of employment for reasons other than Retirement.

Change in Control Vesting. Subject to the provisions of Section 15 of the Plan, if a Change in Control occurs, 100% of the remaining unvested Option Shares shall be immediately vested and exercisable upon the Change in Control and, along with unexercised vested Option Shares, shall remain exercisable through the Expiration Date.

Exercise of Option.

Manner of Exercise. The vested Option Shares may be exercised, in whole or in part, by delivering written notice to the Company in accordance with of Section 7(k) hereof and in such form as the Company may require from time to time. Such notice of exercise shall:

specify the number of Option Shares to be purchased;

specify the aggregate Option Price for such Option Shares; and

be accompanied by payment in full of such aggregate Option Price.

Payment Upon Exercise. The Option Price upon exercise of any Option Shares shall be payable to the Company in full either:

in cash or its equivalent;

by tendering previously acquired Stock that has been held for at least six months (or such longer period to avoid a charge to earnings for financial reporting purposes) and having an aggregate Fair Market Value at the time of exercise equal to the total Option Price, or

a combination of Sections 3(b)(i) and (ii) hereof.

In addition, payment of the Option Price may be payable by one or more of the following methods either upon written consent from the Committee or if one or more of the following methods will not result in a charge to earnings for financial reporting purposes:

by withholding Stock that otherwise would be acquired on exercise having an aggregate Fair Market Value at the time of exercise equal to the total Option Price,

by tendering other Awards payable under the Plan, or

by cashless exercise through delivery of irrevocable instructions to a broker to promptly deliver to the Company the amount of proceeds from a sale of shares having a Fair Market Value equal to the purchase price.

Any combination of Sections 3(b)(i)-(vi) upon written consent of the Committee.

Compliance with Federal and State Law. The Company reserves the right to delay a Participant’s exercise of an Option if the Company’s issuance of Stock upon such exercise would violate any applicable federal or state securities laws or any other applicable laws or

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regulations. The Participant may not sell or otherwise dispose of the Option Shares in violation of any applicable law. The Company may postpone issuing and delivering any Option Shares for so long as the Company reasonably determines to be necessary to satisfy the following:

its completing or amending any securities registration or qualification of the Option Shares or it or the Participant satisfying any exemption from registration under any federal or state law, rule, or regulation;

its receiving proof it considers satisfactory that a person seeking to exercise the Option after the Participant’s death is entitled to do so;

the Participant complying with any requests for representations under the Plan;

the Participant complying with any federal, state, or local tax withholding obligations;

its deferring payment of any amount that it reasonably determines would not be deductible under Code Section 162(m) until the earlier of:

•

the earliest date on which the Company reasonably determines that the deductibility of the payment will not be limited; or

•

the year following the Participant’s termination of employment; and

its compliance with the restrictions of Code Section 409A to the extent applicable, including any final regulations issued pursuant thereto, including the Committee’s right to amend any provision of this Option Agreement, to the extent necessary to comply with Code Section 409A.

No Fractions of Stock. The Company shall not be required to issue any fractional shares of Stock.

Payment of Taxes.

General Rule. If the Company is obligated to withhold an amount on account of any tax imposed as a result of the exercise of an Option, the Participant shall be required to pay such amount to the Company, as provided under Section 17 of the Plan. The Participant acknowledges and agrees that the Participant is responsible for the tax consequences associated with the grant of the Option and its exercise.

Changes in Company’s Capital Structure.

Adjustment in Authorized Stock. As may be determined to be appropriate and equitable by the Committee, in its complete and sole discretion, to prevent dilution or enlargement of rights, the Committee shall make or authorize to be made an adjustment in the number and class of Option Shares and/or the Option Price to prevent dilution or enlargement of rights, as a result of the following:

any adjustment, recapitalization, reorganization or other changes in the Company’s capital structure or its business;

any merger or consolidation of the Company;

any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Company’s Common Stock or the rights thereof;

the dissolution or liquidation of the Company;

any sale or transfer of all or any part of the Company’s assets or business; or

any other corporate act or proceeding, whether of a similar character or otherwise.

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Confidentiality, Non-Solicitation and Non-Compete. Participant agrees to, understands and acknowledges the following:

Confidential Information. Participant will be furnished, use or otherwise have access to certain Confidential Information of the Company. For purposes of this Option Agreement, Confidential Information means any and all financial, technical, commercial or other information concerning the business and affairs of the Company that is confidential and proprietary to the Company, including without limitation,

information relating to the Company’s past and existing customers and vendors and development of prospective customers and vendors, including specific customer product requirements, pricing arrangements, payments terms, customer lists and other similar information;

inventions, designs, methods, discoveries, works of authorship, creations, improvements or ideas developed or otherwise produced, acquired or used by the Company;

the Company’s proprietary programs, processes or software, consisting of but not limited to, computer programs in source or object code and all related documentation and training materials, including all upgrades, updates, improvements, derivatives and modifications thereof and including programs and documentation in incomplete stages of design or research and development;

the subject matter of the Company’s patents, design patents, copyrights, trade secrets, trademarks, service marks, trade names, trade dress, manuals, operating instructions, training materials, and other industrial property, including such information in incomplete stages of design or research and development; and

other confidential and proprietary information or documents relating to the Company’s products, business and marketing plans and techniques, sales and distribution networks and any other information or documents which the Company reasonably regards as being confidential.

The Company devotes significant financial, human and other resources to the development of its products, its customer base and the general goodwill associated with its business, and the Company diligently maintains the secrecy and confidentiality of its Confidential Information. Each and every component of the Confidential Information is sufficiently secret to derive economic value from its not being generally known to other persons. While employed by the Company and thereafter, Participant will hold in the strictest confidence and not use in any manner which is detrimental to the Company or disclose to any individual or entity any Confidential Information, except as may be required by the Company in connection with Participant’s employment.

All Company Materials are and will be the sole property of the Company. Participant agrees that during and after his or her employment by the Company, Participant will not remove any Company Materials from the business premises of the Company or deliver any Company Materials to any person or entity outside the Company, except as Participant is required to do so in connection with performing the duties of his or her employment. Participant further agrees that, immediately upon the termination of his or her employment for any reason, or during Participant’s employment if so requested by the Company, Participant will return all Company Materials and other physical property, and any reproduction thereof, excepting only Participant’s copy of this Agreement. For purposes of this Option Agreement, Company Materials means documents or other media or tangible items that contain or embody Confidential Information or any other information

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concerning the business, operations or future/strategic plans of the Company, whether such documents have been prepared by Participant or by others.

Non-Solicitation and Non-Compete. For the period beginning on the date hereof and ending twelve (12) months following the termination of employment with the Company, Participant will not directly or indirectly:

employ, recruit or solicit for employment any person who is (or was within the six (6) months prior to Participant’s employment termination date) an employee of the Company;

accept employment or engage in a competing business which may require contact, solicitation, interference or diverting of any of the Company’s customers, or that may result in the disclosure, divulging, or other use, of Confidential Information or Company Materials acquired during Participant’s employment with the Company; or

solicit or encourage any customer, vendor or potential customer or vendor of the Company with whom Participant had contact while employed by the Company to terminate or otherwise alter his, her or its relationship with the Company. Participant understands that any person or entity that Participant contacted during the twelve (12) months prior to the date of Participant’s termination of employment for the purpose of soliciting sales from such person or entity shall be regarded as a “potential customer” of the Company to whom the Company has a protectible proprietary interest.

Remedies for Violation.

Injunctive Action. Participant acknowledges that if he or she violates the terms of this Section 6, the injury that would be suffered by the Company as a result of a breach of the provisions of this Option Agreement (including any provision of Section 6 (a) or (b) hereof) would be irreparable and that an award of monetary damages to the Company for such a breach would be an inadequate remedy. Consequently, the Company will have the right, in addition to any other rights it may have, to obtain injunctive relief to restrain any breach or threatened breach or otherwise to specifically enforce any provision of this Option Agreement, and the Company will not be obligated to post bond or other security in seeking such relief. Without limiting the Company’s rights under this Section 6(c) (or Sections 6(a) or (b) hereof) or any other remedies of the Company, if the Participant breaches any of the provisions of Sections 6(a) or (b) hereof, the Company will have the right to cease making any payments otherwise due to the Participant under this Option Agreement.

Forfeiture of the Option and Repayment. In addition to the rights available to the Company under Section 6(c)(i) hereof, if Participant violates the terms of this Section 6 at any time, Participant, without any further action by the Company or Participant, shall forfeit, as of the first day of any such violation, all right, title and interest to this Option, any Option Shares then owned by Participant and any net proceeds received by Participant pursuant to any sales or transfer of any Option Shares prior to, on or after such date, and the Company shall have the right to issue a stop transfer order and other appropriate instructions to its transfer agent with respect to this Option and the Option Shares, and the Company further shall be entitled to reimbursement from Participant of any fees and expenses (including attorneys’ fees) incurred by or on behalf of the Company in enforcing the

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Company’s rights under this Section 6. By accepting this Option grant, Participant hereby consents to a deduction from any amounts the Company owes to Participant from time to time (including amounts owed to Participant as wages or other compensation, fringe benefits, or vacation pay, as well as any other amounts owed to Participant by the Company), to the extent of any amounts that Participant owes the Company under this Section 6. In addition to any injunctive relief sought under Section 6(c)(i) hereof and whether or not the Company elects to make any set-off in whole or in part, if the Company does not recover by means of set-off the full amount Participant owes to the Company, calculated as set forth in this Section 6(c)(ii), Participant agrees to immediately pay the unpaid balance to the Company.

Enforceability of Restrictive Covenants. The scope and duration of the restrictive covenants contained in this Option Agreement are reasonable and necessary to protect a legitimate, protectible interest of the Company. However, if one or more provisions of this Option Agreement are held to be unenforceable under applicable law to any extent, such provision(s) shall, to that extent, be excluded from this Option Agreement and the balance of the Option Agreement shall be interpreted as if such provision(s) were so excluded to that extent and shall be enforceable in accordance with its terms.

Written Acknowledgement by Participant. The Committee, in its sole discretion, may require the Participant, as a condition to the exercise of this Option, to acknowledge in writing that he or she has not engaged, and is not in the process of engaging, in any of the activities described in this Section 6.

Miscellaneous Provisions.

No Service or Employment Rights. No provision of this Option Agreement or of the Option granted hereunder shall give the Participant any right to continue in the service or employ of the Company or any Subsidiary, create any inference as to the length of employment or service of the Participant, affect the right of the Company or any Subsidiary to terminate the employment or service of the Participant, with or without Cause, or give the Participant any right to participate in any employee welfare or benefit plan or other program (other than the Plan) of the Company or any Subsidiary.

Stockholder Rights. Until the Option shall have been duly exercised to purchase such Option Shares and such shares have been officially recorded as issued on the Company’s official stockholder records, no person or entity shall be entitled to vote, receive dividends or be deemed for any purpose the holder of any Option Shares, and adjustments for dividends or otherwise shall be made only if the record date therefor is subsequent to the date such shares are recorded and after the date of exercise and without duplication of any adjustment.

Plan Document Governs. The Option is granted pursuant to the Plan, and the Option and this Option Agreement are in all respects governed by the Plan and subject to all of the terms and provisions thereof, whether such terms and provisions are incorporated in this Option Agreement by reference or are expressly cited. Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Plan. Any inconsistency between the Option Agreement and the Plan shall be resolved in favor of the Plan. Participant hereby acknowledges receipt of a copy of the Plan.

Investment Representation and Agreement. The Committee may require the Participant to furnish to the Company, prior to the issuance of any shares of Common Stock upon the

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exercise of all or any part of this Option, an agreement (in such form as the Committee may specify) in which the Participant represents that the shares of Common Stock acquired by him or her upon exercise are being acquired for investment and not with a view to the sale or distribution thereof.

Beneficiary Designation. The Participant may, from time to time, in accordance with procedures set forth by the Committee, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under this Option Agreement is to be paid in case of his or her death before he or she receives any or all of such benefit. Each such designation shall revoke all prior designations by the Participant, shall be in a form prescribed by the Company, and will be effective only when filed by the Participant in writing with the Committee during the Participant’s lifetime. In the absence of any such designation, benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s estate or exercised by the Participant’s estate.

Administration. This Option Agreement and the rights of the Participant hereunder are subject to all the terms and conditions of the Plan, as the same may be amended from time to time, as well as to such rules and regulations as the Committee may adopt for administration of the Plan. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Option Agreement, all of which shall be binding upon the Participant.

No Vested Right In Future Awards. Participant acknowledges and agrees (by executing this Option Agreement) that the granting of Options under this Option Agreement are made on a fully discretionary basis by the Company and that this Option Agreement does not lead to a vested right to further Option awards in the future.

Use Of Personal Data. By executing this Option Agreement, Participant acknowledges and agrees to the collection, use, processing and transfer of certain personal data, including his or her name, salary, nationality, job title, position, and details of all past Awards and current Awards outstanding under the Plan (“Data”), for the purpose of managing and administering the Plan. The Participant is not obliged to consent to such collection, use, processing and transfer of personal data, but a refusal to provide such consent may affect his or her ability to participate in the Plan. The Company, or its Subsidiaries, may transfer Data among themselves or to third parties as necessary for the purpose of implementation, administration and management of the Plan. These various recipients of Data may be located elsewhere throughout the world. The Participant authorizes these various recipients of Data to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Plan. The Participant may, at any time, review Data with respect to the Participant and require any necessary amendments to such Data. The Participant may withdraw his or her consent to use Data herein by notifying the Company in writing; however, the Participant understands that by withdrawing his or her consent to use Data, the Participant may affect his or her ability to participate in the Plan.

Severability. In the event that any provision of this Option Agreement shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of this Option Agreement, and this Option Agreement shall be construed and enforced as if the illegal or invalid provision had not been included.

Waiver; Cumulative Rights. The failure or delay of either party to require performance by the other party of any provision hereof shall not affect its right to require performance of such provision unless and until such performance has been waived in writing. Each and every

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right hereunder is cumulative and may be exercised in part or in whole from time to time.

Notices. Any notice which either party hereto may be required or permitted to give the other shall be in writing and may be delivered personally or by mail, postage prepaid, addressed to the Secretary of the Company, at its then corporate headquarters, and the Participant at the Participant’s address as shown on the Company’s records, or to such other address as the Participant, by notice to the Company, may designate in writing from time to time.

Counterparts. This Option Agreement may be signed in two counterparts, each of which shall be an original, but both of which shall constitute but one and the same instrument.

Successors and Assigns. This Option Agreement shall inure to the benefit of and be binding upon each successor and assign of the Company. All obligations imposed upon the Participant, and all rights granted to the Company hereunder, shall be binding upon the Participant’s heirs, legal representatives and successors.

Governing Law. This Option Agreement and the Option granted hereunder shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without giving effect to provisions thereof regarding conflict of laws.

Entire Agreement. This Option Agreement, together with the Plan, constitute the entire obligation of the parties hereto with respect to the subject matter hereof and shall supersede any prior expressions of intent or understanding with respect to this transaction.

Amendment. Any amendment to this Option Agreement shall be in writing and signed by the Company.

Headings. The headings contained in this Option Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Option Agreement.

IN WITNESS WHEREOF , the Company has caused this Option Agreement to be duly executed by an officer thereunto duly authorized, and the Participant has hereunto set his or her hand, all as of the day and year first above written.


ZEBRA TECHNOLOGIES CORPORATION				Participant


Charles R. Whitchurch, CFO and Treasurer				Joanne Townsend

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EXHIBIT B

Form of

R ESTRICTED S TOCK A GREEMENT

This RESTRICTED STOCK AGREEMENT (this “Stock Agreement”), dated as of March 17, 2008 (the “Grant Date”), is between ZEBRA TECHNOLOGIES CORPORATION , a Delaware corporation (the “Company”), and JOANNE TOWNSEND (the “Participant”), relating to restricted stock granted to the Participant under the 2006 Zebra Technologies Corporation Incentive Compensation Plan (the “Plan”). Capitalized terms used in this Stock Agreement without definition shall have the meanings ascribed to such terms in the Plan.

Grant of Restricted Stock.

Grant. Subject to the provisions of this Stock Agreement and pursuant to the provisions of the Plan, the Company hereby grants to the Participant as of the Grant Date 6,000 shares of the Company’s Class A Common Stock, $.01 par value per share (the “Restricted Stock”).

Nontransferability. Except as otherwise permitted under the Plan or this Stock Agreement, the Restricted Stock granted hereunder shall be non-transferable by the Participant during the Period of Restriction set forth under Section 2 of this Stock Agreement.

Vesting of Restricted Stock.

Period of Restriction. The Restricted Stock shall be forfeitable and non-transferable during the Period of Restriction. The Period of Restriction with respect to the Restricted Stock shall begin on the Grant Date and shall end on September 4, 2012; provided, however, the Period of Restriction will lapse in accordance with the following schedule:

twenty-five percent (25%) of the Restricted Stock shall vest (and the restrictions on nontransferability shall lapse on such Restricted Stock) if at any time during the Period of Restriction the average of the Total Shareholder Return (as hereinafter defined) measured over any forty-five (45) consecutive trading-days is at least sixty percent (60%); and

the final seventy-five percent (75%) of the Restricted Stock shall vest (and the restrictions on nontransferability shall lapse on such Restricted Stock) if at any time during the Period of Restriction the average of the Total Shareholder Return measured over any forty-five (45) consecutive trading-days, is at least one hundred percent (100%).

If the average of the Total Shareholder Return measured over any forty-five consecutive trading-day period is between sixty percent (60%) and one hundred percent (100%), then the Participant shall vest in the Restricted Stock in the aggregate (which Vested Percentage shall include the 25% reflected in subparagraph (i), above), as follows (rounded to the nearest whole share):


Total Shareholder Return		Vested Percentage
65% but less than 70%		28.8%
70% but less than 75%		33.4%
75% but less than 80%		39.3%
80% but less than 85%		46.8%
85% but less than 90%		56.2%
90% but less than 95%		68.4%
95% but less than 100%		83.8%

Except as otherwise provided for under this Stock Agreement or under the Employment Agreement between the Company and the Participant effective as of March 17, 2008 (the “Employment Agreement”), the Participant must remain employed continuously through each applicable vesting date. Any Restricted Stock which is unvested at the expiration of the Period of Restriction as a result of the failure to attain the required Total Shareholder Return shall immediately be forfeited to the Company.

“Total Shareholder Return” shall be equal to (i) the fair market value of a share of the Company’s Common Stock as reported on The NASDAQ Stock Market as of the close of business on any particular date minus $36.80 plus aggregate dividends paid on a share of the Company’s Common Stock since September 4, 2007, divided by (ii) $36.80.

The Committee shall make or authorize to be made an adjustment to the foregoing formula for Total Shareholder Return to prevent dilution or enlargement of the Total Shareholder Return, as a result of the following: (1) any adjustment, recapitalization, reorganization or other changes in the Company’s capital structure or its business; (2) any merger or consolidation of the Company (other than a Change in Control); (3) any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Company’s common stock or the rights thereof; (4) the dissolution or liquidation of the Company; (5) any sale or transfer of all or any part of the Company’s assets or business; or (6) any other corporate act or proceeding, whether of a similar character or otherwise.

Vesting Exceptions. Notwithstanding the provisions of Section 2(a) hereof, a Participant’s unvested Restricted Stock shall be subject to the following additional vesting rules in the following circumstances:

Termination of Employment. Except as provided in Section 2(b)(ii), in the event the Participant’s employment with the Company and/or any Subsidiary is terminated for any reason, any unvested Restricted Stock as of the date of the Participant’s termination of employment shall immediately be forfeited to the Company.

Change in Control Termination of Employment. Subject to the provisions of Section 15 of the Plan, in the event a Change in Control occurs during the Period of

Restriction and the Participant’s employment is terminated by the Company and/or any Subsidiary without Cause or is terminated by the Participant for Good Reason during the period beginning 120 days before and ending one (1) year after such Change in Control, any Restricted Stock which is unvested as of the date of the Change in Control shall be accelerated upon such a termination of employment and shall vest as follows:


Date of Change in Control		Percentage of Unvested That Vest
Prior to September 4, 2008		100%
On or after September 4, 2008, but prior to September 4, 2009		80%
On or after September 4, 2009 but prior to September 4, 2010		60%
On or after September 4, 2010 but prior to September 4, 2011		40%
On or after September 4, 2011 but prior to September 4, 2012		20%

“Cause” and “Good Reason” shall have the respective meanings assigned to such terms in the Employment Agreement.

Rights While Holding Restricted Stock.

Legend. Each certificate issued for shares of Restricted Stock under this Stock Agreement shall be registered in the Participant’s name and deposited by the Participant, together with a stock power endorsed in blank, with the Company and shall bear the following (or a similar) legend:

• “The transferability of this certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture) contained in a Stock Agreement entered into between the registered owner and Zebra Technologies Corporation.”

When shares of Restricted Stock become vested, the Company shall redeliver to the Participant (or the Participant’s legal representatives, beneficiaries or heirs) the number of shares which have then vested. The Participant agrees that any sale of shares of Restricted Stock received upon vesting shall be made in compliance with the registration requirements of the Securities Act of 1933 or an applicable exemption therefrom. The Committee may require the Participant to furnish to the Company, prior to the delivery of any vested shares of Restricted Stock, an agreement (in such form as the Committee may specify) in which the Participant represents that the shares of stock are being acquired for investment and not with a view to the sale or distribution thereof.

Rights as a Stockholder. During the period that shares of Restricted Stock remain unvested, the Participant shall have all of the rights of a stockholder of the Company with respect to the Restricted Stock including, but not limited to, the right to receive dividends paid on the shares of Restricted Stock and the full right to vote such shares.

Section 83(b) Election. Unless prior written consent of the Committee is secured, the Participant is not permitted to make a Section 83(b) election with respect to the Restricted Stock granted under this Stock Agreement. If the Committee consents to such Section 83(b) election, the Participant must notify the Committee within ten (10) days after filing the Section 83(b) election with the Internal Revenue Service.

Compliance with Federal and State Law. The Company may postpone issuing and delivering any Restricted Stock for so long as the Company reasonably determines to be necessary to satisfy the following:

it completing or amending any securities registration or qualification of the Restricted Stock or it or the Participant satisfying any exemption from registration under any federal or state law, rule or regulation;

the Participant complying with any requests for representations under the Plan; and

the Participant complying with any federal, state or local tax withholding obligations.

Payment of Taxes. If the Company is obligated to withhold an amount on account of any tax imposed as a result of the issuance of the Restricted Stock, the Participant shall be required to pay such amount to the Company, as provided under Section 17 of the Plan. The Participant acknowledges and agrees that the Participant is responsible for the tax consequences associated with the grant of the Restricted Stock and its vesting.

Confidentiality, Non-Solicitation and Non-Compete. Participant agrees to, understands and acknowledges the following:

Confidential Information. Participant will be furnished, use or otherwise have access to certain Confidential Information of the Company. For purposes of this Stock Agreement, “Confidential Information” means any and all financial, technical, commercial or other information concerning the business and affairs of the Company that is confidential and proprietary to the Company, including without limitation,

information relating to the Company’s past and existing customers and vendors and development of prospective customers and vendors, including, without limitation, specific customer product requirements, pricing arrangements, payment terms, customer lists and other similar information;

inventions, designs, methods, discoveries, works of authorship, creations, improvements or ideas developed or otherwise produced, acquired or used by the Company;

the Company’s proprietary programs, processes or software, consisting of, but not limited to, computer programs in source or object code and all related documentation and training materials, including all upgrades, updates, improvements, derivatives and modifications thereof and including, without limitation, programs and documentation in incomplete stages of design or research and development;

the subject matter of the Company’s patents, design patents, copyrights, trade secrets, trademarks, service marks, trade names, trade dress, manuals, operating instructions, training materials, and other industrial property, including, without limitation, such information in incomplete stages of design or research and development; and

All Company Materials are and will be the sole property of the Company. Participant agrees that during and after his or her employment by the Company, Participant will not remove any Company Materials from the business premises of the Company or deliver any Company Materials to any person or entity outside the Company, except as Participant is required to do so in connection with performing the duties of his or her employment. Participant further agrees that, immediately upon the termination of his or her employment for any reason, or during Participant’s employment if so requested by the Company, Participant will return all Company Materials and other physical property, and any reproduction thereof, excepting only Participant’s copy of this Agreement. For purposes of this Stock Agreement, “Company Materials” means documents or other media or tangible items that contain or embody Confidential Information or any other information concerning the business, operations or future/strategic plans of the Company, regardless of whether such documents have been prepared by Participant or by others.

Non-Solicitation and Non-Compete. For the period beginning on the date hereof and ending twenty-four (24) months following the termination of employment with the Company, Participant will not directly or indirectly:

employ, recruit or solicit for employment any person who is (or was within six (6) months prior to Participant’s employment termination date) an employee of the Company;

solicit or encourage any customer, vendor or potential customer or vendor of the Company with whom Participant had contact while employed by the Company to terminate or otherwise alter his, her or its relationship with the Company. Participant understands that any person or entity that Participant contacted during the twelve (12) months prior to the date of Participant’s termination of employment with the Company for the purpose of soliciting sales from such person or entity shall be regarded as a “potential customer” of the Company to whom the Company has a protectible proprietary interest.

Remedies for Violation.

Injunctive Action. Participant acknowledges that if he or she violates the terms of this Section 5 the injury that would be suffered by the Company as a result of a breach of the provisions of this Stock Agreement (including any provision of Section 5(a) or (b) hereof) would be irreparable and that an award of monetary damages to the Company for such a breach would be an inadequate remedy. Consequently, the Company will have the right, in addition to any other rights it may have, to obtain injunctive relief to restrain any breach or threatened breach or otherwise to specifically enforce any provision of this Stock Agreement, and the Company will not be obligated to post bond or other security in seeking such relief. Without limiting the Company’s rights under this Section 5(c) (or Sections 5(a) or (b) hereof) or any other remedies of the Company, if the Participant breaches any of the provisions of Sections 5(a) or (b) hereof, the Company will have the right to cease making any payments otherwise due to the Participant under this Stock Agreement.

Forfeiture of Restricted Stock and Repayment. In addition to the rights available to the Company under Section 5(c)(i) hereof, if Participant violates the terms of this Section 5 at any time, Participant, without any further action by the Company or Participant, shall forfeit, as of the first day of any such violation, all right, title and interest to unvested Restricted Stock, any Shares then owned by Participant due to vesting of Restricted Stock and any net proceeds received by Participant pursuant to any sales or transfer of any Restricted Stock (or Shares held as a result of the vesting of the Restricted Stock) prior to, on or after such date, and the Company shall have the right to issue a stop transfer order and other appropriate instructions to its transfer agent with respect to the Restricted Stock (and Shares held as a result of the vesting of the Restricted Stock), and the Company further shall be entitled to reimbursement from Participant of any fees and expenses (including attorneys’ fees) incurred by or on behalf of the Company in enforcing the Company’s rights under this Section 5. By accepting this Restricted Stock grant, Participant hereby consents to a deduction from any amounts the Company owes to Participant from time to time (including amounts owed to Participant as wages or other compensation, fringe benefits or vacation pay, as well as any other amounts owed to Participant by the Company), to the extent of any amounts that Participant owes to the Company under this Section 5. In addition to any injunctive

relief sought under Section 5(c)(i) hereof and whether or not the Company elects to make any set-off in whole or in part, if the Company does not recover by means of set-off the full amount Participant owes to the Company, calculated as set forth in this Section 5(c)(ii), Participant agrees to immediately pay the unpaid balance to the Company.

Enforceability of Restrictive Covenants. The scope and duration of the restrictive covenants contained in this Stock Agreement are reasonable and necessary to protect a legitimate, protectible interest of the Company.

Written Acknowledgement by Participant. The Committee, in its sole discretion, may require the Participant, as a condition to lapsing any restriction on the Restricted Stock, to acknowledge in writing that he or she has not engaged, and is not in the process of engaging, in any of the activities described in this Section 5.

Miscellaneous Provisions.

No Service or Employment Rights. No provision of this Stock Agreement or of the Restricted Stock granted hereunder shall give the Participant any right to continue in the service or employ of the Company or any Subsidiary, create any inference as to the length of employment or service of the Participant, affect the right of the Company or any Subsidiary to terminate the employment or service of the Participant, with or without Cause, or give the Participant any right to participate in any employee welfare or benefit plan or other program (other than the Plan) of the Company or any Subsidiary.

Plan Document Governs. The Restricted Stock is granted pursuant to the Plan, and the Restricted Stock and this Stock Agreement are in all respects governed by the Plan and subject to all of the terms and provisions thereof, regardless of whether such terms and provisions are incorporated in this Stock Agreement by reference or are expressly cited. Any inconsistency between the Stock Agreement and the Plan shall be resolved in favor of the Plan. Participant hereby acknowledges receipt of a copy of the Plan.

Beneficiary Designation. The Participant may, from time to time, in accordance with procedures set forth by the Committee, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under this Stock Agreement is to be paid in case of his or her death before he or she receives any or all of such benefit. Each such designation shall revoke all prior designations by the Participant, shall be in a form prescribed by the Company, and will be effective only when filed by the Participant in writing with the Committee during the Participant’s lifetime. In the absence of any such designation, benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s estate or exercised by the Participant’s estate.

Administration. This Stock Agreement and the rights of the Participant hereunder are subject to all the terms and conditions of the Plan, as the same may be amended from time to time, as well as to such rules and regulations as the Committee may adopt for administration of the Plan. It is expressly understood that the Committee is authorized to administer, construe, and make all determinations necessary or appropriate to the administration of the Plan and this Stock Agreement, all of which shall be binding upon the Participant.

No Vested Right In Future Awards. Participant acknowledges and agrees (by executing this Stock Agreement) that the granting of Restricted Stock under this Stock Agreement is made on a fully discretionary basis by the Company and that this Stock Agreement does not lead to a vested right to further restricted stock awards in the future.

Use Of Personal Data. By executing this Stock Agreement, Participant acknowledges and agrees to the collection, use, processing and transfer of certain personal data, including his or her name, salary, nationality, job title, position and details of all past Awards and current Awards outstanding under the Plan (“Data”), for the purpose of managing and administering the Plan. The Participant is not obliged to consent to such collection, use, processing and transfer of Data, but a refusal to provide such consent may affect his or her ability to participate in the Plan. The Company, or its Subsidiaries, may transfer Data among themselves or to third parties as necessary for the purpose of implementation, administration and management of the Plan. These various recipients of Data may be located elsewhere throughout the world. The Participant authorizes these various recipients of Data to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Plan. The Participant may, at any time, review Data with respect to the Participant and require any necessary amendments to such Data. The Participant may withdraw his or her consent to use Data herein by notifying the Company in writing; however, the Participant understands that by withdrawing his or her consent to use Data, the Participant may affect his or her ability to participate in the Plan.

Severability. If one or more provisions of this Stock Agreement (including, without limitations, the provisions of Section 5 hereof) are held to be unenforceable under applicable law to any extent, such provision(s) shall, to that extent, be excluded from this Stock Agreement and the balance of the Stock Agreement shall be interpreted as if such provision(s) were so excluded to that extent and shall be enforceable in accordance with its terms.

Counterparts. This Stock Agreement may be signed in two counterparts, each of which shall be an original, but both of which shall constitute but one and the same instrument.

Successors and Assigns. This Stock Agreement shall inure to the benefit of and be binding upon each successor and assign of the Company. All obligations imposed upon the Participant, and all rights granted to the Company hereunder, shall be binding upon the Participant’s heirs, legal representatives and successors.

Governing Law. This Stock Agreement and the Restricted Stock granted hereunder shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without giving effect to provisions thereof regarding conflict of laws.

Entire Agreement. This Stock Agreement, together with the Plan, constitute the entire obligation of the parties hereto with respect to the subject matter hereof and shall supersede any prior expressions of intent or understanding with respect to this transaction.

Amendment. Any amendment to this Stock Agreement shall be in writing and signed by the Company.

Headings and Construction. The headings contained in this Stock Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Stock Agreement. This Stock Agreement is intended to be a stock right excluded from the requirements of Code Section 409A. The terms of this Stock Agreement shall be administered and construed in a manner consistent with the intent that it be a stock right excluded from the requirements of Code Section 409A.

I N WITNESS WHEREOF, the Company has caused this Stock Agreement to be duly executed by an officer thereunto duly authorized, and the Participant has hereunto set his or her hand, all as of the day and year first above written.


ZEBRA TECHNOLOGIES CORPORATION						Participant

By:
Name:						Name:
Title:

Exhibit 10.2

LOGO

Zebra Technologies Corporation

and its Subsidiaries

2008 Management Bonus Plan

SECTION 1 – PURPOSE

1.1 Purpose: Zebra Technologies Corporation and its subsidiaries (“Zebra”) provides a Management Bonus Plan (the “Plan”) to focus the attention of participants on growing the business based on a specific set of goals and to reward performance in attaining these goals. While Associates play many different roles within the Company, the Company will be successful only if all Associates are focused on achieving common goals, strive individually for functional excellence in their assigned roles, and contribute to organizational excellence as a team. The Plan is established pursuant to the 2006 Zebra Technologies Corporation Incentive Compensation Plan and is subject to the provisions set forth therein.

SECTION 2 – DEFINITIONS

2.1 Definitions: Wherever used herein, the following terms shall have the respective meanings set forth below, unless otherwise expressly provided. When the defined meaning is intended, the term is capitalized.

(a)

“Associate” shall mean an employee of Zebra Technologies Corporation or one of its subsidiaries.

(b)

“Base Earnings” shall mean the actual gross base pay received, while an eligible Participant, during the Plan Year. Base Earnings shall exclude payments of all other bonuses, commissions, imputed income, and any other non-base pay forms of compensation.

(c)

“Bonus Award” shall mean the award earned by a Participant based on a comparison of actual year-end results against the Financial Performance Goals and Individual Performance Goals established at the beginning of the Plan Year.

(d)

“Cause” shall mean a Participant’s failure to follow directives and policies of the Company, the failure to follow the reasonable directives of a superior, willful malfeasance, gross negligence, acts of dishonesty, or conduct injurious to the Company.

(e)

“Committee” shall mean the Compensation Committee of the Board of Directors of Zebra Technologies Corporation.

(f)

“Company” shall mean Zebra Technologies Corporation and its subsidiaries.

(g)

“Financial Performance Goal” shall mean the budgeted level of operating profit, for the Company or applicable business unit, as further defined in Section 4.2 and Exhibit A.

(h)

“Individual Performance Goals” shall mean clear, specific, and measurable goals that are aligned with the overall goals of the Company or applicable business unit, and are approved by the applicable business unit or functional Vice President.

(i)

“Participant” shall mean an Associate of the Company who is in a position meeting the defined eligibility criteria for participation in the Plan, as stated in Sections 3.1 and 3.2.

(j)

“Performance Payout Percentage” shall mean the amount of Target Bonus Percentage awarded based on the level of goal achievement.

(k)

“Plan” shall mean the Zebra Technologies Corporation and Its Subsidiaries 2008 Management Bonus Plan in the form established and defined herein.

(l)

“Plan Year” shall mean the fiscal year of Zebra Technologies Corporation, which extends from January 1, 2008 through December 31, 2008.

(m)

“Section 16 Officers” shall mean any officers of the Company as defined in Rule 16a-1

under the Securities Exchange Act of 1934, as amended.

(n)

“Target Bonus Percentage” shall mean the percent of Base Earnings which would be paid to a Participant if the respective target levels of the Financial Performance Goals and Individual Performance Goals applicable to such Participant in the Plan Year were achieved.

SECTION 3 – ELIGIBILITY AND PARTICIPATION

3.1 Eligibility: Eligibility for participation in the Plan will be limited to those Associates who, by the nature and scope of their position, regularly and directly make or influence policy or operating decisions which impact the growth, profitability, and earnings results of the Company. For purposes of this Plan, such Associates are limited to the Chief Executive Officer, Vice Presidents, Directors, and Managers, by job title, provided they are assigned a salary grade of E-12 or above; provided, however, that non-US Associates and Associates within the Enterprise Solutions Group (ESG) who are not assigned salary grades will be eligible for participation in the Plan based upon job title only. Department supervisors also may be considered eligible for participation provided they are in an exempt salaried position and regularly supervise no less than four direct reports. Any Associate participating in a sales incentive or commission arrangement or any other bonus program shall be excluded from participation in this Plan unless otherwise determined by the Committee.

3.2 Participation: Participation in the Plan shall be determined annually by the Vice President, Human Resources; provided, however, that participation by Section 16 Officers of the Company shall be determined by the Committee. Associates approved for participation shall be notified of their selection.

3.3 Partial Plan Year Participation: The Vice President, Human Resources may allow an Associate who becomes eligible during the Plan Year, either as a new hire or as a result of an internal promotion, to participate in the Plan provided, however, that participation by Section 16 Officers of the Company shall be determined by the Committee. In such case, only Base Earnings received, while an eligible Participant, in the Plan Year shall be used in calculating the Bonus Award. Newly hired Associates or Associates who first become eligible as a result of an internal promotion must have a hire date or a promotion date prior to November 1, 2008.

3.4 Changes In Participation Level and/or Organizational Unit: A Participant who changes positions and/or is assigned to a different organizational unit (as defined by their reporting relationship), during the Plan Year, shall have their Bonus Award calculated on a prorated basis using the time eligible in each situation to account for changes in the calculation components. However, if such a change occurs on or after November 1, 2008, the Participant’s Bonus Award will be calculated for the full Plan Year using the measures of the immediately preceding position.

3.5 Leave of Absence: A Participant on an approved leave of absence, as defined by the Family and Medical Leave Act of 1993, shall be considered eligible for a full Bonus Award payable at the same time as other Participants. A Participant on any other form of approved leave of absence shall have their Bonus Award calculated on a partial year basis, payable at the same time as other Participants or upon their return to active duty, whichever is later.

3.6 No Right to Participate: Participation by an Associate in a bonus plan in any period prior to the Plan Year does not provide a right or entitlement to be selected for participation in the Plan Year or any future period.

SECTION 4 – BONUS AWARD DETERMINATION

4.1 Eligibility for Bonus Award: Except as provided in Section 6, in order to be eligible to receive a Bonus Award for any Plan Year, a Participant must be employed continuously as a Participant through the entire Plan Year (or partial Plan Year, in accordance with Section 3.3) and at the time that the Bonus Award is paid.

4.2 Financial Performance Goals: The Financial Performance Goals for the Company and its

business units are set forth in Exhibit A. The Financial Performance Goals shall represent the target level of performance required to earn one hundred percent (100%) of the Target Bonus Percentage. The Performance Payout Percentages that will be awarded for achievement of the respective Financial Performance Goals at various performance levels are set forth in Exhibit A. In no case shall the Performance Payout Percentage exceed 200%, nor shall payment of a Bonus Award be made to a Participant for achievement of a Financial Performance Goal that falls below the applicable minimum performance level set forth in Exhibit A for such Financial Performance Goal.

4.3 Individual Performance Goals: All Participants, except those assigned a job title of Vice President and above, shall be required to establish Individual Performance Goals for the Plan Year. Individual Performance Goals shall be clear, specific, measurable, aligned with overall Company goals and approved by their functional Vice President. The performance level, for each individual performance goal, shall be determined by dividing actual results by the applicable Individual Performance Goal. The Performance Payout Percentage for various achievement levels shall be determined in accordance with the following scale:

Maximum performance level = Maximum Performance Payout Percentage (200%)

Target performance level = Target Performance Payout Percentage (100%)

Minimum performance level = Minimum Performance Payout Percentage (0%)

Performance Payout Percentages for achievement between these levels shall be calculated on a linear basis. In no case shall the Performance Payout Percentage exceed 200%, nor shall payment be made for achievement that falls below the minimum performance level.

4.4 Bonus Components: All Participants, except those assigned a job title of Vice President and above, shall have their individual Bonus Award calculated on the basis of two independent bonus components: a financial performance component and an individual performance component. These two bonus components will be calculated separately and added together to determine the Participant’s Bonus Award. Participants assigned a job title of Vice President or higher shall have their individual Bonus Award calculated on the basis of the financial performance component only, with no individual performance component. The assignment and weighting of bonus components shall be communicated to Participants at the same time as their eligibility notification.

4.5 Bonus Award Calculation: At the end of each Plan Year, the Company shall evaluate actual results against Financial Performance Goals and, where applicable, against Individual Performance Goals, and compute Bonus Awards for each Participant. These computations shall be made using the following formula:

BONUS AWARD = (A x B x C x D) + (A x B x E x F)

Where:

A = Base Earnings

B = Target Bonus Percentage

C = Financial Performance Goal Performance Payout Percentage

D = Financial Performance Goal weighting percentage

E = Individual Performance Goal Performance Payout Percentage (where applicable)

F = Individual Performance Goal weighting percentage (where applicable)

4.6 Illustrative Example: The following example is provided for illustrative purposes only. If a Participant’s 2008 Base Earnings were equal to $80,000, and the Participant’s Target Bonus Percentage was equal to 10%, and the applicable Financial Performance Goal Performance Payout Percentage were equal to 95% with a 60% weighting percentage, and the Participant’s Individual Performance Goal Performance Payout Percentage were equal to 110% with a 40% weighting percentage; then the amount of Bonus Award earned would be equal to:

($80,000 X .10 X .95 X .60) + ($80,000 X .10 X 1.10 X .40) = $8,080

4.7 Multiple Financial Performance Goals: In cases where multiple Financial Performance Goals are

used, each Financial Performance Goal achievement percentage will be calculated separately and adjusted by applying the assigned weighting to each Financial Performance Goal used. The results of these independent calculations will then be added together to determine a single consolidated Financial Performance Goal achievement percentage.

4.8 Minimum Performance Standard: Participants whose personal performance is rated as “Substantially Below Expectations” as part of the Zebra Technologies Corporation Annual Performance Management Review process shall not be eligible to receive an award under this Plan, including any bonus resulting from the achievement of Financial Performance Goals and / or Individual Performance Goals.

SECTION 5 – PAYMENT OF BONUS AWARDS

5.1 Form and Timing of Payment: Payment of Bonus Awards shall be made in cash, subject to applicable payroll tax and benefit plan withholdings, as soon as administratively feasible after the end of the Plan Year following the final determination of the fiscal year’s financial results, but in any event, such payment shall be made during the calendar year following the end of the Plan Year.

SECTION 6 – TERMINATION OF EMPLOYMENT

6.1 Termination of Employment Due to Voluntary Resignation: In the event a Participant’s employment is terminated due to voluntary resignation, excluding retirement as determined by the Vice President, Human Resources, prior to the payment of his or her Bonus Award, the Bonus Award shall not be earned and the Participant shall not be entitled to payment.

6.2 Termination of Employment for Cause: In the event a Participant’s employment is terminated for Cause prior to payment of his or her Bonus Award, the Bonus Award shall not be earned and the Participant shall not be entitled to payment.

6.3 Termination of Employment Due to Death, Disability or Retirement: In the event a Participant’s employment is terminated by reason of death, Disability or retirement during the Plan Year or prior to payment of his or her Bonus Award, the Bonus Award shall be considered earned, calculated on a prorated basis, and paid at the same time as other Participants.

6.4 Termination of Employment for Reasons Other Than Voluntary Resignation, Cause, Death, Disability or Retirement: In the event a Section 16 Officer’s employment is terminated for reasons other than voluntary resignation, Cause, death, Disability or retirement prior to payment of his or her Bonus Award, a prorated Bonus Award may be paid in the sole discretion of the Committee. In the event any other Participant’s employment is terminated for reasons other than voluntary resignation, Cause, death, Disability, or retirement prior to payment of his or her Bonus Award, a prorated Bonus Award may be paid in the sole discretion of the Vice President, Human Resources.

SECTION 7 – RIGHTS OF PARTICIPANTS

7.1 Employment: Nothing in this Plan shall interfere with or limit in any way the right of the Company to terminate or change a Participant’s employment at any time, nor confer upon any Participant any right to continue in the employ of the Company. Nothing herein contained shall limit or affect in any manner or degree the normal and usual powers of management, exercised by the officers and the Board of Directors of the Company to change the duties or the character of employment of any Associate or to remove the individual from the employment of the Company at any time, all of which rights and powers are expressly reserved by the Company.

SECTION 8 – ADMINISTRATION

8.1 Administration: This Plan shall be administered by the Vice President, Human Resources in accordance with the provisions contained herein; subject to the direction and approval of the Committee with respect to matters relating to any Section 16 Officers of the Company.

8.2 Questions of Construction and Interpretation: The determination of the Vice President, Human Resources or the Committee in construing or interpreting this Plan or making any decision with respect to the Plan shall be final, binding, and conclusive upon all persons. The Vice President, Human Resources’ interpretative responsibility shall include any and all definitions in the Plan, including, but not limited to, interpretations of Cause. This Plan is established pursuant to the 2006 Zebra Technologies Corporation Incentive Compensation Plan and the provisions hereof are in all respects governed by the 2006 Zebra Technologies Corporation Incentive Compensation Plan and subject to all of the terms and provisions thereof. In the event of any inconsistency, between this Plan and the 2006 Zebra Technologies Corporation Incentive Compensation Plan, the terms of the 2006 Zebra Technologies Corporation Incentive Compensation Plan shall govern.

8.3 Conflicts: To the extent that a Participant and the Company have entered into a written Employment Agreement that contains provisions that conflict with the provisions of this Plan, the provisions contained in the Employment Agreement shall control.

8.4 Amendments: The Company, in its absolute discretion, without notice, at any time and from time to time, may modify or amend, in whole or in part, any or all of the provisions of this Plan, or suspend or terminate it entirely; provided, however, that no such modification, amendment, suspension, or termination, may without the consent of the Participant (or the Participant’s beneficiary in the case of death) reduce after the end of the Plan Year the right of a Participant (or the Participant’s beneficiary as the case may be) to a payment or distribution in accordance with the provisions contained in this Plan.

8.5 Governing Law: This Plan shall be construed in accordance with, and governed by, the laws of the State of Illinois without giving effect to conflicts of laws principles.

8.6 Committee Authority: Notwithstanding anything herein to the contrary, any and all determinations or actions to be taken with respect to the Plan that relate to a Section 16 Officer of the Company shall be determined or taken by the Committee.

Exhibit A

Financial Performance Goals for 2008

The Financial Performance Goal for the Company shall be the budgeted level of Consolidated Income From Operations, as defined in this Exhibit A.

The Financial Performance Goal for Consolidated SPG, SPG Americas, SPG EMEA, and SPG APAC shall be such business units’ respective budgeted levels of Direct Operating Profit, as defined in this Exhibit A.

The Financial Performance Goals for ESG shall be the budgeted levels of Revenue, EBITDA and Total Bookings, as each is defined in this Exhibit A, with Revenue given 25% weighting, EBITDA given 50% weighting and Total Bookings given 25% weighting of the overall Financial Performance Goals component of the Bonus Award.

Definitions


Performance Measure		Definition
Consolidated Income From Operations ¹		Income from Operations as reported in the Company’s management reports, adjusted to remove the impact of changes in foreign exchange rates.
Consolidated Income From Operations ¹		Acquisitions – generally, the acquired company budget and actual financial performance is applied to the Management Bonus Plan financial objectives as of the first of the quarter following 6 months after the acquisition closing.

Direct Operating Profit ¹		Direct Operating Profit as reported in the Company’s management reports for each of Consolidated SPG, SPG Americas, SPG EMEA, and SPG APAC adjusted to remove the impact of changes in foreign exchange rates only in Consolidated SPG and SPG EMEA.

Revenue		ESG Total GAAP revenue for the Plan year.

EBITDA		ESG Operating Profit (GAAP) as reported in the Company’s management reports, adjusted to remove the impact of Euromax bonus payments and labor expenses charged to the Marine Terminal Systems reserve, plus interest, taxes, depreciation, amortization, and 123R compensation expense.

Total Bookings		Total ESG bookings during the year after any allocations for GAAP Vendor Specific Objective Evidence calculations.

Specifically excludes such expense items as (i) Amortization of Intangibles; (ii) FAS123(R) compensation expense; (iii) One-time charges, non-operating charges or expenses incurred that are not under the control of operations management, as ratified by the Compensation Committee; (iv) Board of Directors Project Activities (eg. CEO search, directors searches); or (v) Gains or losses on the sale of assets. The above list is NOT exhaustive and is meant to represent EXAMPLES of the kind of expenses typically EXCLUDED from the calculations of Consolidated Income from Operations and Direct Operating Profit. Unless otherwise noted, all amounts are expressed in US dollars.

Legend:

SPG = The Specialty Printer Group business unit of Zebra Technologies Corporation.

ESG = The Enterprise Solutions Group business unit of Zebra Technologies Corporation.

Performance Payout Percentages

The Performance Payout Percentages that will be awarded for achievement of the following Financial Performance Goals at the indicated levels are set forth below. Performance between any of the stated achievement levels shall be interpolated on a straight line basis between such stated performance levels.

The Performance Payout Percentages for each of Consolidated Income From Operations and Direct Operating Profit shall be as follows:


% of Goal Achievement		Performance Payout Percentage (% of Target Bonus)
85.0%		0%
92.5%		25%
95.0%		50%
97.5%		75%
100.0%		100%
101.9%		125%
103.8%		150%
105.6%		175%
107.5%		200%

The Performance Payout Percentages for each of Revenue and Total Bookings shall be as follows:


% of Goal Achievement		Performance Payout Percentage (% of Target Bonus)
80%		0%
83%		17%
87%		33%
90%		50%
93%		67%
97%		83%
100%		100%
103%		117%
107%		133%
110%		150%
113%		167%
117%		183%
120%		200%

The Performance Payout Percentages for EBITDA shall be as follows:


% of Goal Achievement		Performance Payout Percentage (% of Target Bonus)
80%		0%
83%		17%
87%		33%
90%		50%
93%		67%
97%		83%
100%		100%
112%		117%
123%		133%
135%		150%
147%		167%
158%		183%
170%		200%

Exhibit 10.3

MANUFACTURING SERVICES AGREEMENT

BETWEEN

JABIL CIRCUIT, INC.

AND

ZEBRA TECHNOLOGIES CORPORATION

May 30, 2007

Table of Contents


			PAGE
Article I.	GENERAL TERMS AND CONDITIONS		8

1.1	Definitions		8
1.2	Appointment of Manufacturer		8
1.3	Other Zebra Parties		8
1.4	Exclusivity		9
1.5	Non-competition		9
1.6	Most Favored Nation		9
1.7	Competitiveness		9
1.8	Quality Data		10
1.9	Management of the Relationship		10
	a.	Appointment of Project Team	10
	b.	Duties of Project Team	10
1.10	Critical Personnel		11

Article II.	ENGINEERING SERVICES; INTELLECTUAL PROPERTY		11

2.1	Value Engineering and Product Design Services		11
	a.	Value Engineering Services; DFX Analysis	11
	b.	Product Design Services	11
	c.	Prototype and Pilot Run Pricing	11
2.2	Statements of Work		11
2.3	Zebra Technology		12
	a.	Ownership of Zebra Technology	12
	b.	Assignment of Zebra Technology	12
	c.	Limited License to Zebra Technology	12
	d.	Zebra Covenant	13
2.4	Manufacturer Technology		13
	a.	Ownership of Manufacturer Technology	13
	b.	Restrictions on the Use of Manufacturer Technology in Products	13
	c.	License to Manufacturer Technology	13
	d.	Manufacturer Rebuild License	13
	e.	Transition Services Plan	13
	f.	Manufacturer Process Adaptation and Documentation	13
2.5	Manufacturer Covenants		14
	a.	Assigned or Licensed Technology	14
	b.	Non-Assignable Zebra Technology	14
2.6	No Rights in Either Party		14
	a.	Trademarks	14
	b.	Other Intellectual Property	15


Article III.	MANUFACTURING SERVICES		15

3.1	General Terms		15
3.2	Transfer Plan		15
3.3	Facilities		16
	a.	Designated Facilities	16
	b.	Line Down/Stop Ship	16
	c.	Business Continuity Plan	16
3.4	Tooling		17
	a.	Procurement of Unique Tooling	17
	b.	Ownership and Maintenance of Tooling	17
3.5	[*** Redacted]		18
3.6	[*** Redacted]		18
3.7	Zebra Materials		18
3.8	Other Materials		19
	a.	Approved Materials and Vendors	19
	b.	Manufacturer Direct Purchases	19
	c.	Consignments	19
	d.	Materials Declaration	19
	e.	Inbound Inspections	21
	f.	Last Buys	21
	g.	Initial Transfer of Materials to Manufacturer	21
3.9	Long-Lead Time Materials; Minimum Order Quantities		21
3.10	Destruction of Scrap		21
3.11	Inventory Management		21
	a.	Inventory Tracking	22
	b.	Inventory Reports	22
3.12	Change Orders		22
3.13	Subcontractors		23
3.14	Samples and Inspections		23
	a.	Samples	24
	b.	Inspections	24
3.15	Regulatory Audits/Actions		24
3.16	No Use of Prohibited Labor		24
3.17	Compliance with C-TPAT		25
3.18	Purchase of Materials		25
3.19	Support Life		25

Article IV.	FORECAST, RELEASE AND SHIPPING PROCEDURES		25

4.1	Forecasts		26
4.2	Purchase Order and Releases		26
	a.	Open Purchase Order	26
	b.	Releases	26
	c.	Flexibility of Forecasts and Releases	27

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-2-


	d.	Minimum Order Requirements	27
4.3	Excess Inventory and Obsolete Inventory During the Term		27
	a.	Excess Inventory	27
	b.	Obsolete Inventory	28
	c.	Duty to Minimize	28
	d.	Procedure	28
4.4	Safety Stock		28
4.5	Marking and Shipping Products		28
	a.	During Transfer Plan	28
	b.	After Transfer Plan	29
	c.	Shipping Costs	29
	d.	Deviations in Ship Dates	29
	e.	Marking, Packaging and Shipping Specifications	29
	f.	Title; Risk of Loss	29
	g.	Customs	29
4.6	Non-conforming Products		30
	a.	Inspection; Rejection	30
	b.	Replacement	30
	c.	Short Against Order	30
4.7	Vendor Managed Inventory		31
	a.	Approved Warehouses	31
	b.	Approved Warehouse Procedures	31
	c.	Inventory at Approved Warehouses	31
	d.	Performance at Approved Warehouses	32
4.8	Communications		33

Article V.	PRICING; PAYMENTS		33

5.1	Pricing		33
	a.	Pricing Method	33
	b.	Initial Price	33
	c.	Price Adjustments	33
5.2	Product Costs		34
	a.	Cost Model	34
	b.	Bill of Materials Review	34
	c.	Cost Reduction Initiatives	34
5.3	Invoice and Payment Procedure		34
5.4	Taxes; Fees		35
5.5	Currency		35

Article VI.	CONFIDENTIALITY; PUBLICITY		35

6.1	Confidential Information		35
6.2	Non-Disclosure of Confidential Information		36
6.3	Non-Disclosure of Agreement		36

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-3-


6.4	Exceptions		36
6.5	Return or Destruction of Confidential Information		37
6.6	Publicity		37

Article VII.	REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION		37

7.1	General Representations and Warranties		37
	a.	Corporate Existence and Power	37
	b.	Authorization and Enforcement of Obligations	37
	c.	Consents	38
	d.	No Conflict	38
7.2	Product-Specific Warranties		38
7.3	Epidemic Failures		39
7.4	Certain Representations, Warranties and Covenants of Manufacturer		40
7.5	Disclaimer		40
7.6	Indemnification		41
	a.	Manufacturer’s Indemnities	41
	b.	Zebra’s Indemnities	41
	c.	Notification and Procedure for Claims	41
7.7	Limitation of Liabilities		42
	a.	Exclusion of Consequential Damages	42
	b.	*[* Redacted]***	42
	c.	Exceptions Under Law	42
7.8	Remedies under Other Agreements		42
7.9	Insurance		42
	a.	Insurance to be Carried by Manufacturer	42
	b.	Minimum Insurance Requirements	43
	c.	Retentions	43
	d.	[* Redacted]**	43
	e.	[* Redacted]**	43

Article VIII.	TERM AND TERMINATION		43

8.1	Term		43
8.2	Termination for Breach		43
8.3	Additional Termination Rights		44
	a.	Zebra	44
	b.	Manufacturer	44
8.4	Partial Termination		44
8.5	Termination for Insolvency		44
8.6	Effect of Termination		44
	a.	Outstanding Orders	44
	b.	Payments Upon Termination	45
	c.	Duty to Minimize Costs	45
	d.	Outstanding SOWs	45

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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	e.	Materials Transfer	45
	f.	Survival	45

Article IX.	MISCELLANEOUS		46

9.1	Assignment		46
9.2	Successors		46
9.3	No Third Party Beneficiaries		46
9.4	Bankruptcy Events		46
9.5	Dispute Resolution		46
	a.	Exclusive Procedure	46
	b.	Escalation; Arbitration	47
	c.	Executives’ Negotiation	47
	d.	Formal Proceedings	47
	e.	Binding Arbitration	47
	f.	Continued Performance	48
	g.	Confidentiality	48
9.6		Governing Law; Jurisdiction	48
9.7	Relationship of Parties		49
9.8	Notices		49
9.9	Severability		50
9.10	Compliance with Foreign Corrupt Practices Act		50
9.11	Rights and Remedies Cumulative		51
9.12	Further Assurances		51
9.13	Force Majeure		51
	a.	General	51
	b.	Supply Preference	52
9.14	Counterparts		52
9.15	Construction		52
9.16	Consent		53
9.17	Other Terms		53
9.18	Entire Agreement		53
9.19	No Amendment; Waiver		53

Article X.	DEFINITIONS		53

Article XI.	Jabil Circuit		83

11.2	Page 82/9		83
11.3	Page 83/9		84
11.4	Page 84/9		85
11.5	Page 85/9		86
11.6	Page 86/9		87
11.7	Page 87/9		88

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBITS


EXHIBIT A		61
EXHIBIT B		62
EXHIBIT C		63
EXHIBIT D		74
EXHIBIT E		75
EXHIBIT F		85
EXHIBIT G		92
EXHIBIT H		97
EXHIBIT I		98
EXHIBIT J		99
EXHIBIT L		100
EXHIBIT M		101
EXHIBIT N		102

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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MANUFACTURING SERVICES AGREEMENT

This MANUFACTURING SERVICES AGREEMENT (this “ Agreement ”) is made this 30th day of May, 2007 (“ Effective Date ”) by and between JABIL CIRCUIT, INC. , a Delaware corporation, having a principal place of business at 10560 Dr. Martin Luther King, Jr. Street, North St. Petersburg, Florida 33716, on behalf of itself and its Affiliates (“ Manufacturer ”), and ZEBRA TECHNOLOGIES CORPORATION , having a principal place of business at 333 Corporate Woods Parkway, Vernon Hills, Illinois 60061 (“ Zebra ”). Zebra and Manufacturer are, collectively, referred to herein as the “ parties ,” or individually as a “ party .”

A. WHEREAS, Zebra is in the business of designing, developing, manufacturing, distributing, marketing and selling printers, including thermal bar code label and receipt printers, card printers, photo quality thermal dye transfer printers, RFID smart label printers/encoders, label design and integration software, supplies, accessories and certain related products;

B. WHEREAS, Manufacturer is in the business of providing comprehensive design, development, manufacturing, testing, configuring, assembling, packaging, shipping and product management services of electronics components, assemblies and systems;

C. WHEREAS, Zebra desires to purchase certain products from Manufacturer, including PCBAs and Box Builds, and Manufacturer desires to manufacture and sell such products to Zebra, on the terms and conditions set forth in this Agreement; and

D. WHEREAS, Zebra may, from time to time, desire Manufacturer to provide engineering, design or other services related to products under this Agreement, which services will be addressed as set forth in Section 2.1 .

NOW THEREFORE, in consideration of foregoing and the other promises and mutual covenants set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Manufacturer and Zebra hereby agree and covenant as follows.

Article I.

General Terms And Conditions

1.1

Definitions . Terms used herein with initial capital letters shall have the respective meanings set forth in Article X.

1.2

Appointment of Manufacturer . Zebra hereby appoints Manufacturer, and Manufacturer hereby accepts, the non-exclusive appointment to manufacture the Products for purchase by Zebra, at such times and from time to time as Zebra, in its sole discretion, may request by issuance of a binding forecast per Section 4.1 .

1.3

Other Zebra Parties . If Zebra provides Manufacturer with a parental guarantee, Zebra’s Affiliates shall have the right to purchase Products in accordance with the other terms of

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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this Agreement. Any and all pricing that is offered to Zebra shall also be made available to Zebra’s Affiliates.

1.4

Exclusivity . Manufacturer shall not manufacture, package, market or sell any finished Product, or any WIP, component, subassembly, assembly or print engine unique to any finished Product, to or for any Person, anywhere in the world, other than to Zebra or Zebra’s Affiliates.

1.5

Non-competition . Manufacturer acknowledges that Zebra possesses valuable Confidential Information, Technology and Intellectual Property Rights related to the Products, that Zebra derives significant competitive advantage from the foregoing, that Manufacturer will be exposed to Zebra’s Confidential Information and Technology in connection with its obligations under this Agreement and that money damages are insufficient to protect Zebra’s interest in its Confidential Information, Technology and Intellectual Property Rights. Manufacturer further acknowledges that the scope of Zebra’s business is independent of location such that is not practical to limit the restrictions contained in this Section 1.5 to specific countries. Therefore, in order to protect Zebra’s rights in its Confidential Information, Technology and Intellectual Property Rights, and the value of Zebra’s business, to the extent permitted by applicable Laws, [*** Redacted] Manufacturer acknowledges that the restrictions contained in this Section 1.5 are reasonable in all respects, necessary to protect Zebra’s Confidential Information, Technology and Intellectual Property Rights, constitute a material inducement of Zebra to enter into this Agreement and that, without such protection, Zebra’s competitive advantage would be materially adversely affected. If, at the time of enforcement of these provisions, a court or arbitrator’s award permitted by Section 9.5a holds that the restrictions stated in this Section 1.5 are unreasonable under circumstances then existing, the parties agree that the maximum period, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area.

1.6

Most Favored Nation . Manufacturer shall not, anywhere in the world, manufacture, package, market or sell thermal barcode printers or thermal card printers, at lower prices, or on better terms, than those offered to Zebra. If such better terms or pricing are provided to any Person, then Manufacturer shall promptly offer the same pricing or terms to Zebra. At its sole option, Zebra may elect to substitute such pricing or terms for the corresponding pricing or terms herein.

1.7

Competitiveness . Manufacturer understands that Zebra’s purchase of Products under this Agreement is dependent upon the Product pricing remaining competitive with that of other manufacturers and suppliers for thermal barcode printers or thermal card printers. Manufacturer shall be responsible for surveying the industry and benchmarking contract terms (including pricing, inventory levels, flexibility and lead time for Materials) and shall share all such information (including Manufacturer’s internal supply chain management report) in detail with Zebra during the Quarterly Business Review.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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1.8

Quality Data . Manufacturer shall submit to Zebra a mechanism for evaluating and scoring Manufacturer’s performance with respect to the Quality Data, consistent with generally accepted United States industry standards. Manufacturer shall monitor, evaluate and score its performance with respect to all Quality Data and shall provide Zebra with a monthly report of such performance, signed by Manufacturer’s Quality Manager, within five (5) Business Days after the last day of such month. Manufacturer shall discuss each such report with Zebra at the next Quarterly Business Review. Zebra shall have the right to terminate this Agreement for cause for Manufacturer’s failure to achieve performance standards under the Quality Data, subject to the same cure period as provided in Section 8.2 .

1.9

Management of the Relationship .

a. Appointment of Project Team . Each party shall initially designate the following personnel with respect to this Agreement: (i) a relationship manager that is a member of its business unit management staff (each a “ Relationship Manager ”); (ii) a technical contact that is a member of its engineering or product development staff (each a “ Technical Manager ”); and (iii) a quality manager that is a member of its quality management staff (each a “ Quality Manager ”). Zebra’s Relationship Manager shall be Zebra’s Commodity Manager, its Technical Manager shall be Zebra’s Director of Manufacturing Engineering and its Quality Manager shall be Zebra’s Director of Operational Quality. Manufacturer’s Relationship Manager shall be Manufacturer’s Business Unit Director, its Technical Manager shall be Manufacturer’s Business Unit Manager and its Quality Manager shall be Manufacturer’s Quality Manager. Each party may change any of such personnel upon notice to the other party.

b. Duties of Project Team . The Relationship Managers, Technical Managers and Quality Managers shall form the project management team (“ Project Team ”) and shall meet in person or by phone:

(i)

within fifteen (15) Business Days after the Effective Date, to promptly develop a Transfer Plan for the initial PCBA Product transfers and regularly thereafter for follow-on Product, including the criteria set forth in Exhibit C (“ Transfer Plan ”);

(ii)

each calendar quarter to (A) monitor and review the Quality Data from the previous calendar quarter, (B) review and discuss the results for the previous calendar quarter of the Bill of Materials and cost reduction reviews required by Section 5.2 , (C) review and monitor the Stored Inventory held at Approved Warehouses pursuant to Section 4.7c , (D) review and discuss the Long-lead Time Materials, and (E) review the business relationship generally, both forward- and backward- looking (collectively, the “ Quarterly Business Review ”); and

(iii)

at the reasonable request of either party.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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The Project Team shall attempt to achieve a timely resolution of any issues or potential issues related to this Agreement before such issues escalate into a Dispute between the parties; provided that, any amendments to this Agreement shall only be made in accordance with Section 9.19 . Any Dispute arising out of or relating to this Agreement shall be resolved solely in accordance with the procedures specified in Section 9.5 .

1.10

Critical Personnel . All employees, contractors and consultants of Manufacturer listed on Exhibit D (the “ Critical Personnel ”) shall dedicate a majority of their time to performing Services for Zebra. [*** Redacted] Manufacturer shall notify Zebra within two (2) Business Days after becoming aware that any Critical Personnel is reassigned or intends to terminate, or has terminated, his or her employment or engagement with Manufacturer and shall also provide Zebra with all information of which Manufacturer is aware with respect to any new employer of any Critical Personnel if such employer is a competitor of Zebra. Upon Zebra’s request, Manufacturer shall inform any such new employer of the Critical Personnel’s confidentiality obligations under this Agreement.

Article II.

Engineering Services; Intellectual Property

2.1

Value Engineering and Product Design Services .

a. Value Engineering Services; DFX Analysis . On an on-going basis during the Term, using normal workcell resources, Manufacturer shall provide value engineering services and DFX Analysis with respect to existing Products, upon Zebra’s request pursuant to the COR/COA process in Section 3.12 and/or the SOW process in Section 2.2 , at no cost to Zebra.

b. Product Design Services . Prior to Manufacturer performing any product design services for Zebra for new Products, the terms and conditions of such services shall be set forth in a mutually agreed upon design services agreement to be negotiated by the parties in good faith; provided that, nothing herein shall obligate either party to enter into any such agreement. If Manufacturer develops a new product for Zebra then, upon Zebra’s request, this Agreement shall be amended to update Exhibit A to add such product to the Products to be manufactured by Manufacturer for Zebra.

c. Prototype and Pilot Run Pricing . Prototypes of Products shall be accommodated by Manufacturer in the selected production plant unless the parties otherwise agree. Prototype pricing shall be agreed by the parties prior to Manufacturer manufacturing the initial prototype. Pilot runs of Products shall be priced at production pricing.

2.2

Statements of Work . An SOW shall be issued for each Product under this Agreement and for Services projects requested by Zebra hereunder. SOW’s shall include, at a minimum (i) the technical and testing specifications for the Product, which specifications shall be included in the Specifications, (ii) a detailed description of any other deliverables to be delivered by Manufacturer to Zebra, (iii) the dates for delivery of the Product and any other deliverables, (iv) testing and acceptance criteria and procedures for the Product and any other deliverables, (v) a mechanism for regularly reporting the project status, as

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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well as any unexpected occurrences, (vi) a detailed estimate of all fees and any NRE Costs in connection with the Product and/or other deliverables, and (vii) the actual cost of any new Unique Tooling required to implement the SOW, which Unique Tooling shall be owned and maintained in accordance with Section 3.4. SOWs shall, upon their execution and delivery, be incorporated into and become a part of this Agreement, and each SOW shall be subject at all times to the terms of this Agreement. Zebra shall have the right to cancel any SOW at any time upon notice to Manufacturer and Manufacturer shall deliver to Zebra all Work Product completed or in progress under such SOW, provided that, subject to Section 5.3 below, Zebra shall pay to Manufacturer all agreed to fees and NRE Costs incurred pursuant to the SOW budget for any Services that are performed to Zebra’s reasonable satisfaction prior to the date of such cancellation, but excluding any non-depreciable NRE Costs for which Manufacturer is responsible pursuant to Section 3.6 .

2.3

Zebra Technology .

a. Ownership of Zebra Technology . As between Manufacturer and Zebra, Zebra shall own all right, title and interest in and to all Zebra Technology. Manufacturer and/or Manufacturer’s personnel shall promptly and fully disclose to Zebra all Zebra Technology developed by Manufacturer under this Agreement.

b. Assignment of Zebra Technology . Manufacturer hereby assigns, and agrees to assign, and to cause its employees to assign, to Zebra, all right, title and interest in the Zebra Technology. In addition, all copyrights and copyrightable works included in the Zebra Technology shall be deemed works made for hire pursuant to United States copyright law and/or similar laws of other jurisdictions, and owned by Zebra from the moment of creation. For the avoidance of doubt, to the extent that any copyright or copyrightable work is deemed not to be a work made for hire, then such copyright or copyrightable work shall be included in the foregoing assignment. Manufacturer hereby agrees to take (and to cause its employee to take) such further action, at Zebra’s cost, as reasonably necessary to establish and perfect Zebra’s rights in the Zebra Technology, including by executing assignment documents, filings with patent offices, affidavits, declarations and powers of attorney as reasonably requested by Zebra. Manufacturer hereby represents, warrants and covenants to Zebra that (a) with respect to employees employed in the United States, it has and shall have, and (b) with respect to employees employed outside the United States, it shall use commercially reasonable efforts to have, written agreements with its employees containing valid and enforceable assignments of all Technology (and Intellectual Property Rights embodied therein) that is discovered, made, created, designed, developed or reduced to practice by or on behalf of each such employee (either alone or jointly with others) during the scope of his or her work for Manufacturer.

c. Limited License to Zebra Technology . Zebra hereby grants to Manufacturer a limited, non-exclusive, non-transferable license during the Term of this Agreement to use the Zebra Technology solely as necessary to manufacture Products for Zebra. Such license shall immediately terminate, and Manufacturer shall immediately cease to use the Zebra Technology, upon termination of this Agreement with respect to any Product or upon

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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expiration or termination of this Agreement as a whole, or upon Zebra’s earlier notification.

d. Zebra Covenant . During and after the Term, Zebra shall neither assert, nor transfer to another a right to assert, against Manufacturer or any of its Affiliates, or dealers or customers or suppliers thereof, any Intellectual Property Right of Zebra that is applicable or relates to any Reusable Technology licensed to Manufacturer or any of its Affiliates in the course of Zebra’s activity hereunder

2.4

Manufacturer Technology .

a. Ownership of Manufacturer Technology . As between Manufacturer and Zebra, Manufacturer shall own all right, title and interest in and to Manufacturer Technology.

b. Restrictions on the Use of Manufacturer Technology in Products . Manufacturer shall ensure that none of the Products may embody or incorporate any Manufacturer Technology except (i) the Reusable Technology, (ii) immaterial Manufacturer Technology, and (iii) material Manufacturer Technology particularly identified to Zebra and for which Zebra has given its express prior approval. With regards to this Section 2.4b , Manufacturer Technology shall be considered “ material ” if such Technology is protected by registration or asserted as a trade secret, otherwise such Technology shall be considered immaterial.

c. License to Manufacturer Technology . Manufacturer hereby unconditionally grants to Zebra a non-exclusive, perpetual, irrevocable, worldwide, fully-paid, royalty-free, fully-transferable license, with the right to grant sublicenses through multiple levels of sublicensees, under any and all Manufacturer Technology, only insofar as is required for Zebra to use, sell, offer to sell, distribute, reproduce, make or have made the same or similar models of the Products and derivatives of the Products; provided however, that no license to manufacturing processes and/or manufacturing process improvements shall be granted hereunder except to the extent such processes or process improvements are incorporated into the Specifications.

d. Manufacturer Rebuild License . Manufacturer hereby unconditionally and irrevocably grants to Zebra a non-exclusive, perpetual, irrevocable, worldwide, fully-paid, royalty-free, fully-transferable license, with the right to grant sublicenses through multiple levels of sublicensees, under any and all Manufacturer Technology, to rebuild and have rebuilt the Products.

e. Transition Services Plan . Upon termination of this Agreement as to any Product, the parties shall negotiate a transition services plan, to be set forth in an SOW, for an efficient transition of the manufacture of the Product to an alternate manufacturing source.

f. Manufacturer Process Adaptation and Documentation . Manufacturer shall initially retain all right, title and ownership to any Manufacturer Process Adaptation and

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Documentation that is prepared as part of the Services. Upon full payment of Transition

Service Fees, (i) Manufacturer hereby assigns, and agrees to assign, to Zebra all right, title and interest in and to the Manufacturer Process Adaptation and Documentation, (ii) Zebra shall grant to Manufacturer a worldwide, non-exclusive, fully paid-up, royalty-free right and license in and to the Manufacturer Process Adaptation and Documentation to the extent that the same is deemed applicable to Reusable Technology, and (iii) Manufacturer shall collect and deliver to the Zebra Technical Manager any documentation provided by Zebra or obtained or created by Manufacturer on Zebra’s behalf, (including specifications, drawings and blueprints for tooling, equipment, fixtures and molds).

2.5

Manufacturer Covenants .

a. Assigned or Licensed Technology . During and after the Term, Manufacturer shall neither assert nor transfer to another a right to assert against Zebra or any of its Affiliates, or dealers or customers or suppliers thereof, any Intellectual Property Right of Manufacturer that is applicable or relates to any Intellectual Property Right licensed or transferred to Zebra or any of Zebra’s Affiliates in the course of Manufacturer’s activity hereunder.

b. Non-Assignable Zebra Technology . Manufacturer hereby (i) unconditionally and irrevocably waives the enforcement of all Non-Assignable Zebra Technology and all causes of action of any kind against Zebra, its Affiliates, and its and their customers, successors and assigns, with respect to such Zebra Technology, and (ii) unconditionally grants to Zebra an exclusive, perpetual, irrevocable, worldwide, fully-paid, royalty-free, fully-transferable license, with the right to grant sublicenses through multiple levels of sublicensees, under any and all Non-Assignable Zebra Technology, without any restrictions, for any and all uses, and in whatever medium or format (whether now known or hereafter existing), including (A) to reproduce, create derivative works of, distribute, publicly perform, publicly display, digitally transmit, and otherwise use the Non-Assignable Zebra Technology, in any medium or format, whether now known or hereafter discovered, (B) to use, make, have made, sell, offer to sell, import, and otherwise exploit any product or service based on, embodying, incorporating, or derived from any Non-Assignable Zebra Technology, and (C) to exercise any and all other present or future rights in or to Non-Assignable Zebra Technology.

2.6

No Rights in Either Party .

a. Trademarks . Manufacturer shall have the right to use Zebra’s Trademarks during the Term solely in connection with the Products and solely as necessary to perform Manufacturer’s obligations under this Agreement to ship marked Product to Zebra or, at Zebra’s direction, to Zebra’s designee. Except as expressly authorized by the foregoing sentence, Manufacturer and Manufacturer’s Affiliates, agents and representatives shall not use the English or any translation of any of Zebra’s Trademarks or any Trademarks confusingly similar thereto. Manufacturer acknowledges that no right, title or interest in or to any such Trademark is conferred, assigned or transferred by virtue of this

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Agreement or otherwise. Manufacturer may not use, adopt, register or attempt to register as a trademark any word, symbol or emblem that is identical or similar to any such Trademark, whether during the continuance of this Agreement or after its expiration or termination, howsoever arising. Manufacturer agrees to cooperate at Zebra’s expense with the registration of any new Trademark by Zebra to the extent such cooperation is reasonable and related to a Product.

b. Other Intellectual Property . Except as expressly set forth herein, nothing in this Agreement or the relationship between Zebra and Manufacturer shall grant to either party any rights to or interest in the other party’s Intellectual Property Rights or Confidential Information, and no implied licenses are granted by this Agreement. For the avoidance of doubt, Manufacturer shall not, during or after the Term: (i) copy, or willfully or negligently permit the copying, by any means any Product for which Zebra owns the tooling, equipment, fixtures, molds and/or design rights therefor; (ii) use, or willfully or negligently permit the use of, any tooling, equipment, fixtures, molds or design rights therefor owned by, or licensed to, Zebra for the benefit of any Person other than Zebra, or (iii) sell, transfer or otherwise dispose of any Product that incorporates any trademark, patentable invention, copyrighted work, industrial design or other Intellectual Property Right of Zebra or any of its Affiliates to any Person other than Zebra . All property now or hereafter owned by any party under the terms of this Agreement shall be returned to such party by, and at the cost and risk of loss of, the other immediately upon request therefor or upon expiration or termination of this Agreement.

Article III.

Manufacturing Services

3.1

General Terms . Manufacturer shall manufacture, test and supply the Products to Zebra (a) fully tested and released for quality by Manufacturer according to the Specifications, the Transfer Plan and such test criteria as provided by Zebra in writing, (b) with respect to finished Products, subject to the completion of the Transfer Plan, in a fully-assembled, packaged and labeled form ready for use, (c) in strict accordance with the Specifications and the other terms and conditions of this Agreement and (d) in accordance with all applicable Laws. All Services hereunder shall be performed in a competent, professional and workmanlike manner, in accordance with industry best practices for manufacturing products of the same or similar type as the respective Product, including ISO 9001-2000 standards, IPC-A 610 Class 2 Standards and Zebra specification standards.

3.2

Transfer Plan . The purpose of the Transfer Plan is to transfer full production of a Product to Manufacturer in stages. Manufacturer shall manufacture only those Products as specified by Zebra in the Transfer Plan. Completion of any activities set forth in the Transfer Plan shall be determined by Zebra in the exercise of its sole but reasonable discretion. Manufacturer shall ensure that its production line for a Product (each, a “ Production Line ”) shall be the same as the pilot production line for such Product (each, a “ Pilot Line ”) as established pursuant to the respective Transfer Plan for such Product unless approved in writing by Zebra. Manufacturer shall maintain the Pilot Line

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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substantially intact until the Production Line is fully operational and qualified by both Zebra and Manufacturer.

3.3

Facilities .

a. Designated Facilities . Manufacturer shall manufacture the Products only at the Designated Facility and shall not change such facility, or product lines within such facility, unless by COA as provided in Section 3.12(ix) . Manufacturer shall operate all facilities for Products in accordance with United States generally accepted industry standards, including with respect to environmental conditions (e.g., plumbing and electrical lines and equipment, and heating, ventilating and air conditioning systems).

b. Line Down/Stop Ship . Manufacturer shall notify Zebra promptly (but in no event longer than twenty-four (24) hours) if any defect or other problem affects a significant portion of a Product line, and Zebra shall have the right to halt the affected Production Line from producing the Products and to issue a stop ship order on all affected Products. If any such condition occurs for any reason, then Manufacturer shall provide additional resources and escalation as needed to accelerate resolution of the problem and to rework affected Product. Manufacturer shall within twenty-four (24) hours of the occurrence of such condition provide Zebra with a report setting forth the status and location of all affected Materials and Products (e.g., finished goods, WIP, etc.).

c. Business Continuity Plan . The Manufacturer’s business continuity plan for the Services and Products (“ BCP ”) shall be attached as Exhibit E to this Agreement. Manufacturer and Zebra shall work together in good faith to promptly resolve any objections Zebra may have with respect to any component of the BCP. If the BCP attached in Exhibit E applies to a specific Designated Facility, then the BCP for each other Designated Facility shall consist of a similar document in similar detail with the same approach to business continuity. As any new Service(s) or Product(s) is added under this Agreement, the respective BCP will be updated to include such new Service(s) or Product(s) prior to the first purchase thereof hereunder. Each BCP shall at a minimum: (i) be designed to prevent any disruption in the supply of the Services and Products, notwithstanding the occurrence of any Force Majeure event or other failure; (ii) specify procedures and frequency of BCP plan testing; (iii) specify alternate facilities (subject to Zebra’s pre-approval) and how quickly they will be activated; (iv) specify priority rights of Zebra for BCP services from Manufacturer in the event of a broad-based failure; and (v) be consistent with current United States generally accepted industry standards, and shall be maintained and updated consistent with then-current United States generally accepted industry standards. If a problem should arise within such facility, or with any such Product line, that would adversely impact Manufacturer’s ability to manufacture any of the Products for Zebra, then Manufacturer shall promptly (but in no event longer than twenty-four (24) hours) notify Zebra in detail of such problem. If Zebra’s supply of the Products is affected or may reasonably be deemed to be threatened (whether by a Force Majeure event or otherwise), Manufacturer shall promptly implement the BCP with respect to the Services and Products. The occurrence of a crisis (including any Force

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Majeure event) will not relieve Manufacturer of its obligation to implement the BCP and to provide disaster recovery services. If the Services and supply of Products are not restored within the period specified in the BCP, Zebra may terminate this Agreement, subject to the same cure period as provided in Section 8.2 .

3.4

Tooling .

a. Procurement of Unique Tooling . Manufacturer shall use any Unique Tooling specified by Zebra in writing to manufacture a Product or perform other Services for Zebra. Before beginning any work hereunder, Manufacturer shall promptly notify Zebra of (i) any Unique Tooling that Manufacturer will need to acquire or manufacture to meet Product or other Service requirements, and the cost thereof, and (ii) the cost to acquire or manufacture any Unique Tooling specified by Zebra. Within thirty (30) days after receipt of Manufacturer’s notification, Zebra shall notify Manufacturer either that (i) it is willing to incur the cost of such Unique Tooling or (ii) it is not willing to incur the cost of such Unique Tooling. If Zebra notifies Manufacturer that it is unwilling to incur such cost, then Manufacturer shall not proceed with the Services for which such Unique Tooling is required. If Zebra notifies Manufacturer that it is willing to incur the costs of such Unique Tooling, then Zebra shall also indicate whether (i) it will provide such Unique Tooling to Manufacturer, or (ii) that it will not provide such Unique Tooling, in which case Manufacturer shall acquire or manufacture such Unique Tooling and Zebra shall reimburse Manufacturer for the cost thereof as provided in Section 5.3 , unless the parties agree in writing that the cost of such Unique Tooling will be included in the price of the affected Product or Service. If Manufacturer purchases Unique Tooling at Zebra’s request and Zebra chooses to include the cost of such Unique Tooling in the price of the affected Product, Zebra will reimburse Manufacturer for any costs not yet recovered through purchases where such shortfall results from Zebra’s failure to purchase the requisite quantity of affected Products or upon termination of this Agreement. To the extent that Unique Tooling must be procured from third parties, unless Zebra notifies Manufacturer that Zebra will procure such Unique Tooling, Manufacturer agrees to be responsible for handling such procurement from the third party designated by Zebra. Upon payment by Zebra for Unique Tooling or, if acquired by Zebra, upon Zebra’s request, Manufacturer shall promptly provide Zebra with the Specifications, drawings and blueprints for all Unique Tooling, whether provided by Zebra or Manufacturer.

b. Ownership and Maintenance of Tooling . Manufacturer shall own all tooling, equipment, fixtures and molds not provided or paid for, directly or indirectly, by Zebra (including all such materials included in thenon-depreciable costs for which Manufacturer is responsible pursuant to Section 3.6 ). Manufacturer shall at its cost take all such maintenance and repair actions as are required to ensure that all tooling, equipment, fixtures and molds used by Manufacturer for the Products and components (whether owned by Zebra or Manufacturer) are and remain capable of producing components and/or finished Products that meet the Specifications. In the event that any tool, equipment, fixture or mold used for the manufacture of the Products is damaged, lost or destroyed during the Term of this Agreement, Manufacturer shall promptly repair or

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replace such tool, equipment or mold at its sole cost. For any tool, equipment, fixture or mold that Zebra pays for through adjustments in the Product pricing (“ Amortized Tooling ”), if it must be replaced due to normal wear and tear or at the end of its normal life, then Manufacturer shall pay for its replacement (and Zebra shall pay for such Amortized Tooling through adjustments in Product pricing) and Zebra shall pay for the remaining unpaid balance of the replaced Amortized Tooling. All substitutions, replacements and renewals made in or to any tool, equipment, fixture or mold shall be the property of the party that owned such tool, equipment, fixture or mold immediately prior to such substitution, replacement or renewal, free and clear of all Liens. Manufacturer shall create and maintain a maintenance checklist file for one hundred percent (100%) of the tooling used to manufacture the Products and shall distribute an updated list to Zebra quarterly.

3.5

[*** Redacted]

3.6

[*** Redacted]

3.7

Zebra Materials . All Unique Tooling and other materials and property provided by or paid for, directly or indirectly (including all such materials included in the non-depreciable NRE Costs described in Section 3.6 ), by Zebra shall be: (i) owned exclusively by Zebra; (ii) used by Manufacturer exclusively to manufacture the Products or to provide the Services for Zebra; (iii) at Zebra’s request, marked with ownership tags furnished by Zebra; (iv) promptly surrendered by Manufacturer and shipped to Zebra at Zebra’s designated facility, at Zebra’s expense, upon the expiration or termination of this Agreement or Zebra’s earlier request; (v) fully insured by Manufacturer for its replacement value as provided below in Section 7.9b(iii)(A) , and (vi) maintained by Manufacturer as provided above in Section 3.4b . Manufacturer shall not encumber Unique Tooling or other materials or property or assign, convey, mortgage or transfer any right or interest in Unique Tooling or other materials or property, and Manufacturer agrees to execute and deliver any evidence of title, bill of sale, assignment or other document or take any other action which Zebra may require in order to evidence Zebra’s rights in its materials and property. Manufacturer grants to Zebra a limited and irrevocable power of attorney, coupled with an interest, to execute and record on Manufacturer’s behalf any notice financing statements with respect to Zebra’s materials and property that Zebra determines are reasonably necessary to reflect Zebra’s interest in such materials and property.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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3.8

Other Materials .

a. Approved Materials and Vendors . Manufacturer shall use only the Materials specified in the Bill of Materials for a Product or Service to manufacture such Product or perform such Service and shall obtain all such Materials only from the vendor specified in the Approved Vendor List for the respective Materials. Zebra may add or remove vendors from the Approved Vendor List at any time upon notice to Manufacturer. Manufacturer may suggest the addition or removal of vendors from the Approved Vendor List at any time, but such changes to the Approved Vendor List shall only be made with Zebra’s prior approval. Manufacturer shall be responsible for qualifying new vendors for the Approved Vendor List for Materials for finished Products (but not for the finished Products themselves), according to procedures specified by Zebra in writing. Manufacturer shall provide a data package for all Materials with sufficient details for Zebra to qualify such Materials at the system level.

b. Manufacturer Direct Purchases .

(i)

At Zebra’s request, Manufacturer shall purchase certain of the Materials directly from a vendor designated by Zebra on terms and conditions that are no less favorable than the terms and conditions such vendor offers to Zebra for such Materials; provided that, Zebra’s vendors permit Manufacturer to purchase under such terms and conditions. By way of example and without limitation, during the transfer of production from Zebra’s suppliers to Manufacturer, Zebra may request that Manufacturer purchase suppliers’ remaining inventory prior to ordering Materials from Manufacturer’s suppliers on the Approved Vendor List. Pricing for this Material will reflect Manufacturer’s purchase price from such supplier.

(ii)

Without limiting the foregoing, Zebra may elect to assign to Manufacturer some or all of Zebra’s purchasing obligations and/or rights to purchase, as applicable, under an agreement with a vendor of Materials, and Manufacturer shall not unreasonably refuse such assignment of rights and assumption of obligations.

c. Consignments . In the event that the parties determine that consignments of Materials are necessary or desirable, the parties will negotiate in good faith the transfer of such consigned Materials, including the amount of mark-up, if any, on such consigned Materials.

d. Materials Declaration . Zebra shall notify Manufacturer, in reasonable detail, with respect to each Product on Exhibit A as of the Effective Date, whether or not the Product is exempt from Materials Declaration Requirements. For Products that have been identified in writing to Manufacturer as subject to Materials Declaration Requirements, Manufacturer shall use commercially reasonable efforts to procure, or assist Zebra in procuring (if applicable), Materials that are compliant with Materials Declaration

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Requirements. Upon Zebra’s request, Manufacturer shall use commercially reasonable efforts to collect documentation from suppliers on the Approved Vendor List as of the Effective Date, certifying compliance with Materials Declaration Requirements with respect to Materials, the form of which certification has been provided, or approved, by Zebra (“ Compliance Certification ”). For suppliers added to the Approved Vendor List after the Effective Date, Manufacturer shall obtain such Compliance Certification as part of the supplier qualification process pursuant to Section 3.8a . Upon Zebra’s request, Manufacturer shall promptly provide copies of all requested Compliance Certifications to Zebra. In the event that any supplier does not provide Compliance Certification, Manufacturer shall promptly notify Zebra and cooperate with Zebra to remove such supplier from the Approved Vendor List or take such other action that the parties mutually agree upon in writing. In addition, Manufacturer shall fully cooperate and render all necessary assistance to Zebra in its efforts to recover on any claims against any suppliers related to Materials Declaration Requirements. In the event that a supplier fails to provide a Compliance Certification, Manufacturer has notified Zebra of such failure and Zebra has notified Manufacturer that Zebra still chooses to accept Materials from such supplier, then Manufacturer shall bear no responsibility or liability for the lack of such Compliance Certification. Zebra understands and agrees that:

(i)

Zebra is responsible for notifying Manufacturer of the specific Materials Declaration Requirements and any exemptions thereto that Zebra determines to be applicable to the Product and, as between Zebra and Manufacturer, shall be solely liable for the adequacy and sufficiency of such determination of Materials Declaration Requirements;

(ii)

Any information or certification regarding Materials Declaration Requirements of a Product as well as Materials used in the Product shall come from the relevant supplier (which Manufacturer shall promptly pass on to Zebra). Manufacturer does not test, certify or otherwise warrant Materials compliance, on a homogenous material level or any other level, with Materials Declaration Requirements; and

(iii)

As between Zebra and Manufacturer, Zebra is ultimately and solely responsible for compliance with, Materials Declarations Requirements, including ensuring that any Materials used in the Product, as well as the Product itself, are compliant with applicable Materials Declaration Requirements, other than with respect to (A) the remedies provided for under Section 7.2b and (B) Manufacturer’s failure to perform its obligations under this Section 3.8d .

Notwithstanding anything to the contrary herein, if Zebra determines that any Materials received by Manufacturer for use in Products (whether directly from the supplier or in a rejected or returned Product) do not comply with Materials Declarations Requirements, then Zebra shall be entitled to the remedies provided in Section 7.2b .

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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e. Inbound Inspections . Manufacturer shall perform the inspection procedures set forth in Exhibit F (the “ Inspection Procedures ”) on all incoming Materials and shall not use any Materials that do not pass such inspection in any of the Products. Manufacturer shall not pass on any costs related to any such Materials to Zebra. If the Inspection Procedures apply to a specific Designated Facility, then the Inspection Procedures for each other Designated Facility shall consist of a similar document in similar detail with the same approach to Materials inspection.

f. Last Buys . Within fifteen (15) Business Days after the Effective Date, Manufacturer shall provide contact information for suppliers of Materials for the Products and shall promptly provide updated details to Zebra as such information changes. If Manufacturer becomes aware that a supplier plans to discontinue any Materials (by termination or otherwise), then Manufacturer shall promptly notify Zebra and work with Zebra to place a last-buy order sufficient for Zebra’s needs, it being understood that Manufacturer shall place such order and shall keep such Materials in Manufacturer’s inventory until consumed by Zebra. Zebra shall be responsible for inventory storage costs for that portion of the last-buy inventory that exceeds Zebra’s 90-day forecasted demand in the Weekly Forecast. Such cost shall be calculated in the same manner as for storage costs for Excess Inventory pursuant to Section 4.3a . Manufacturer shall work with Zebra to transition discontinued Materials to new Materials, including by performing a form, fit and function analysis, and comparison, of such Materials.

g. Initial Transfer of Materials to Manufacturer . During the initial transfer of a Product, Manufacturer shall not apply a mark-up to the Materials provided by Zebra.

3.9

Long-Lead Time Materials; Minimum Order Quantities . Manufacturer and Zebra shall agree in writing on the Materials that are Long-lead Time Materials or have minimum order quantities for each Bill of Materials and each Product or Service. If during the Term, Long-Lead Time Materials or Materials with minimum order quantities are required for any Product or Service, then Manufacturer shall notify Zebra of such Materials and quantities and shall not purchase such Materials without Zebra’s prior approval. Manufacturer shall keep Zebra apprised on an ongoing basis of any changes to any such Long-lead Time Materials or minimum order quantities. It is the intent of the parties that Long-lead Time Materials and minimum order quantities shall be a topic discussed by the parties at the Quarterly Business Review.

3.10

Destruction of Scrap . Not later than the tenth (10th) day after the end of each calendar month, Manufacturer shall destroy all Scrap accumulated during such month and shall provide written certification of such destruction to Zebra with the inventory report required by Section 3.11 . Manufacturer shall be solely responsible for the cost of all Scrap and all cost and expenses related to Scrap, including the cost of destruction.

3.11

Inventory Management .

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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a. Inventory Tracking . Manufacturer shall maintain the ability to trace individual Materials and Products via barcode, which barcode shall provide information necessary or useful for recalls, retrofits, field changes and root cause analysis (e.g., serial number, supplier, manufacture date, test history and repair history).

b. Inventory Reports . On a weekly basis during the Term, Manufacturer shall provide to Zebra (at Zebra’s option) reporting via online access to Manufacturer’s customer information system or in a file format meeting Zebra’s requirements a report setting forth as of the last business day of the prior week (a) clear to build for each Product, as well as all Products, (b) Materials inventory levels including those Materials identified to be used with the Products, (c) Materials on order quantities with expected delivery dates to Manufacturer, (d) WIP, (e) advanced shipping notices indicating both Materials and quantities thereof, (f) Materials details including costs and lead times, and (g) any Scrap not destroyed pursuant to S ection 3.10 , together with certification of the Scrap destroyed.

3.12

Change Orders . No change may be made to the manufacturing process or Specifications for a Product, or to the Services to be performed under an SOW, unless pursuant to a COA signed by authorized representatives of both parties. Either party may request such a change by issuing a COR substantially in the form set forth in Exhibit G , consistent with the following procedure:

(i)

The party requesting the COR shall submit the COR to the other party in writing.

(ii)

Zebra shall include with any COR submitted to Manufacturer sufficient documentation for the changes to enable Manufacturer to prepare a COR impact analysis as described in subsection (iv) below. Upon receipt of a COR and such documentation from Zebra, Manufacturer shall in good faith promptly (but in no event later than five (5) Business Days) perform a COR impact analysis and promptly forward it to Zebra.

(iii)

Manufacturer shall include a COR impact analysis as described in subsection (iv) below with any COR submitted to Zebra.

(iv)

Each COR impact analysis shall include (i) the feasibility of the changes, (ii) any update required to the Specifications to implement the COR, (iii) the actual cost of any new Unique Tooling required to implement the COR, which Unique Tooling shall be owned and maintained in accordance with Section 3.4, (iv) the effect of such changes, if any, on Manufacturer’s performance of the Services, including any anticipated changes to the delivery dates for affected Products, (v) status of affected Products, (vi) the estimated effect of such changes, if any, on the fees and NRE Costs for affected Services and/or Products, (vii) cost effect, if any, on WIP and (viii) any other information reasonably requested by Zebra.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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(v)

No COR shall be implemented until authorized representatives of each party have agreed in writing to such changes or modifications of the Products by executing a COA substantially in the form set forth in Exhibit H ; provided that, Manufacturer shall not unreasonably refuse to implement such changes if Zebra has agreed to pay the NRE Costs and changes in Product pricing set forth in Manufacturer’s COR impact analysis. Each COA signed by both parties shall be deemed an amendment to this Agreement including, where applicable, the Specifications.

(vi)

As requested by Zebra in writing, Manufacturer shall rework, at Zebra’s cost, all WIP and Products that are required by Zebra to be modified to the latest COA revision; provided that the corresponding COR was not initiated to correct a defect in Manufacturer’s manufacturing process and not required by the Specifications.

(vii)

Upon execution by both parties of a COA, Zebra shall issue an RCN to reflect any rework charge and any changes to delivery dates, and shall issue such update to the Specifications as necessary to implement changes required by the respective COA. In the event that such change results from a problem as described in Section 3.3 , then Manufacturer must provide the impact analysis required by this Section 3.12 to Zebra as soon as possible, but not later than two (2) Business Days after such problem arises.

(viii)

Manufacturer shall invoice Zebra for all costs of Unique Tooling and any rework costs for WIP or finished Products that are approved by Zebra and required to implement a COA.

(ix)

For the avoidance of doubt, any change in manufacturing location (e.g., facility or production line within a facility) shall be deemed an engineering change that requires approval of a COR prior to implementation.

3.13

Subcontractors . Manufacturer shall not subcontract any of its obligations under this Agreement to any Affiliate or third party, unless it obtains Zebra’s prior consent, which may be withheld in Zebra’s sole discretion. In the event that Manufacturer does subcontract any of its obligations under this Agreement, then the terms and conditions of this Agreement shall apply to all such subcontractors, and Manufacturer shall continue to be liable for performance of its obligations under this Agreement, as well as for the performance of its subcontractors. For purposes of clarification, it shall not be considered subcontracting for Manufacturer to purchase Materials from the vendors on the Approved Vendor List.

3.14

Samples and Inspections . To enable Zebra to verify that Products are being manufactured in strict conformity with Specifications, Manufacturer shall provide the samples and permit the inspections set forth below.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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a. Samples . Manufacturer shall, upon Zebra’s request, send to Zebra such samples of each Product from Manufacturer’s then most recent production of such Product as the parties shall in good faith agree. Initial samples of a Product shall be provided to Zebra at no charge, and Zebra shall pay for all additional requested samples, other than samples requested in connection with a COA. All Products under this Section 3.14 shall be shipped in accordance with Section 4.5 .

b. Inspections . Manufacturer shall allow, and shall cause its vendors to allow, Zebra or its designee the right as reasonably requested (but not less than twice annually, and upon reasonable prior notice (but not greater than three (3) Business Days), to enter the manufacturing and storage facilities (including each Designated Facility and Approved Warehouse) of such Person during regular business hours to inspect and test the Products, WIP, tools, equipment, fixtures, molds and Materials in order to confirm their compliance with the Specifications and compliance with the terms of this Agreement, including performance under Quality Data and key performance indicators. Zebra shall conduct all test and inspections in a manner that avoids unreasonable interference with the operation of such Person’s business. Manufacturer shall make available, and shall cause such vendor to make available, an authorized representative of its organization to facilitate Zebra’s exercise of the foregoing inspection rights. Zebra’s testing and inspection shall not excuse or reduce Manufacturer’s duty to comply with the Specifications or product Warranty set forth in Section 7.2 .

3.15

Regulatory Audits/Actions . During the Term and thereafter for so long as required by applicable Laws, Manufacturer shall maintain such books, records and data as customary in the industry for electronics manufacturing contractors to maintain on behalf of their customers for purposes of evidencing both the contractor’s and the customer’s compliance with environmental, waste, health, safety, labor, occupational, trade and similar and related Laws, and such other records as reasonably requested by Zebra for compliance with same. In the event that Zebra is the subject of a formal or informal investigation, inspection or request from a governmental agency for records related to Zebra’s and its manufacturer’s compliance with any of the foregoing Laws, Manufacturer shall fully cooperate and render all necessary assistance in assisting Zebra in cooperating with and responding to such investigation, inspection or request, including upon specific request (either directly to Manufacturer or indirectly through Zebra) of the requesting agency by promptly providing such books, records and data to the requesting agency and, if deemed reasonably necessary by both parties in order for Zebra to fully cooperate with such governmental agency, to provide access to such governmental agency to such of Manufacturer’s books, records, data, facilities and personnel as appropriate to enable Zebra and its Affiliates to evidence compliance with such Laws. Such access shall be as requested from time to time, upon reasonable notice to the Manufacturer, at reasonable hours.

3.16

No Use of Prohibited Labor . Zebra does not wish to do business with Manufacturers who manufacture or assemble items for sale anywhere in the world using Prohibited Labor, or who fail to satisfy all laws, rules, regulations, codes and standards protecting

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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their employees’ wages, benefits, working conditions, freedom of association, and other rights. Accordingly, Manufacturer shall not knowingly use any Prohibited Labor in manufacturing or assembling the Products or Materials. As part of the Approved Vendor List qualification process pursuant to Section 3.8 , Manufacturer shall verify, to the best of its ability, that all vendors, suppliers and production sources qualified by Manufacturer pursuant to Section 3.8 have not used and will not use Prohibited Labor in the manufacture of the Products or Materials, and Manufacturer shall provide Zebra with written certifications to that effect from such vendors, suppliers and production sources, which certifications Manufacturer shall deliver to Zebra before any such Person begins supplying Products or Materials. Without in any way limiting Zebra’s other rights and remedies under this Agreement, Manufacturer shall be in material breach of this Agreement to the extent any such Products or Materials are made in whole or in part by Prohibited Labor, and, in such event, Zebra shall be entitled to terminate this Agreement, and Manufacturer shall pay to Zebra as liquidated damages, and not as a penalty, a sum equal to the aggregate of the total cost of all such Products and Materials and all freight, import/export charges and other costs incurred for the shipment or return (or destruction, at Zebra’s election) of all seized or re-delivered Products and Materials.

3.17

Compliance with C-TPAT . Zebra is a member of the Customs-Trade Partnership Against Terrorism (“ C-TPAT ”). As such, Zebra imposes certain security measures on its suppliers. Manufacturer shall comply with the security measures which C-TPAT imposes on its members. In addition, Manufacturer shall make any amendments in these processes and procedures as recommended by U.S. Customs and Border Protection which may occur from time to time. Further, during the Term and thereafter for so long as required by applicable Laws, Manufacturer agrees to cooperate with any required verification, audits, reviews or other activities undertaken by U.S. Customs and Border Protection or any other governmental or quasi-governmental agency or representative thereof in connection with C-TPAT.

3.18

Purchase of Materials . Manufacturer shall make all Materials available for purchase by Zebra (either through Manufacturer or directly from the supplier of the Materials) at the Material Cost for such Materials. Zebra may purchase such Materials for use with the Products, including for service and repair of the Products and resale to Zebra’s authorized service providers. Manufacturer shall ship the Materials in accordance with Zebra’s order for such Materials and Article IV below; provided, however, Zebra shall not be obligated to provide a Weekly Forecast for the Materials.

3.19

Support Life . During the period starting with the date of last shipment of a Product and continuing through to the end of Manufacturer’s warranty period for such Product, the parties shall develop a plan to and actually train appropriate personnel, acquire and store spare parts, and transfer the necessary tools and equipment for such Product.

Article IV.

Forecast, Release And Shipping Procedures

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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4.1

Forecasts . On a weekly basis during the Term, Zebra shall provide Manufacturer with a forecast in the form set forth in Exhibit I (the “ Weekly Forecast ”) of the quantities of finished Product to be shipped by Manufacturer. The Weekly Forecast will provide expected quantities (a) on a weekly basis for the first five (5) weeks, (b) for the balance of the calendar month in which the fifth week occurs, and (c) for the three (3) calendar month period that follows the calendar month in which the fifth week occurs. Only the first two (2) weeks of the Weekly Forecast shall be binding upon Zebra to purchase such finished Products and Manufacturer to supply such finished Products; the remainder of such forecast is only an estimate for planning and Materials procurement purposes and shall not constitute a commitment to purchase. In addition, each calendar quarter Zebra shall provide a twelve (12) month view of its reasonably anticipated requirements for each Product (the “ Quarterly Forecast ”), no portion of which shall be binding on either party except for purposes of determining Zebra’s liability for Materials as otherwise stated herein. If such forecast is consistent with the flexibility table set forth in Section 4.2c , Zebra’s forecasts shall be deemed accepted by Manufacturer upon receipt. Manufacturer shall acknowledge each forecast within one (1) Business Day after receipt thereof. If such forecast is not consistent with the flexibility table set forth in Section 4.2c , Manufacturer shall respond with an acceptance or a rejection of such forecast within three (3) Business Days after receipt of such forecast. Manufacturer shall maintain production capacity for each Product based upon Zebra’s forecasts.

4.2

Purchase Order and Releases .

a. Open Purchase Order . Concurrently with submission of its first forecast, Zebra shall issue an open purchase order in the form of Zebra’s SDS contract (a form of which is attached hereto in Exhibit I ) to Manufacturer for each Product under this Agreement, which purchase order (a) shall remain open for one (1) year, at the end of which year Zebra will issue a new purchase order, (b) is issued solely for purposes of complying with Zebra’s internal account payable procedures for payments to Manufacturer, (c) shall contain the following statement on its face, “This Purchase Order is subject to the Manufacturing Services Agreement, dated May 30, 2007 between Zebra Technologies Corporation and Jabil Circuit, Inc.,” and (d) remains wholly subject to the provisions of this Agreement.

b. Releases. Manufacturer shall ship all Products on a first in, first out (i.e., “ FIFO ”) basis according to releases provided by Zebra (which Zebra may issue on a daily basis) against its open purchase order. Releases may be on Zebra’s standard form and shall specify the following (each, a “ Release ”): (i) name of each Product to be released, including model number and/or SKU and revision number (if applicable); (ii) the quantity of each such Product; (iii) shipping arrangements, including delivery destination; and (iv) delivery date. Releases shall be deemed accepted by Manufacturer upon receipt; provided that, Manufacturer shall have the right to reject a Release only if (i) such Release is, either individually, or in the aggregate, when compared against Zebra’s most recent forecast for the applicable period, outside the flexibility table below in Section 4.2c , (ii) the fees

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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reflected in the Release are inconsistent with the pricing set forth in Exhibit A , or (iii) such Release would extend Zebra’s credit beyond the credit line extended to Zebra by Manufacturer, which credit line shall not be unreasonably decreased by Manufacturer. Notwithstanding the foregoing, Manufacturer shall use commercially reasonable efforts to fulfill Releases that exceed the allowable quantity increase (per the flexibility table below in Section 4.2c ) over Zebra’s forecast, subject to the availability of Materials. Manufacturer shall notify Zebra of rejection of any such Release as soon as possible, but not later than one (1) Business Day after receipt thereof, unless the Release is rejected pursuant to the foregoing subsection (i), in which case, not later than three (3) Business Days after receipt thereof.

c. Flexibility of Forecasts and Releases. Manufacturer shall provide capacity and upside flexibility for each Product in accordance with the following:

[*** Redacted]

In the chart above, the Maximum Rescheduled Delivery Day indicates the number of days that Zebra may delay delivery of Products without incurring any additional obligation or liability for purchase of such Products. In the event the number of days for rescheduling a delivery day exceeds the parameters set forth above, with respect to the Products and Materials affected, Zebra at its option shall either purchase such Products and/or Unique Materials from Manufacturer or pay to Manufacturer storage charges for such Products and/or Unique Materials at rate equal to [*** Redacted] per month times the cost to purchase such Products and/or Unique Materials at the respective applicable cost set forth in Section 4.3a , 4.3b or 4.3c . The parties shall review on a quarterly basis Manufacturer’s capacity for Products.

d. Minimum Order Requirements . The parties shall agree on the minimum order quantities and minimum shipment quantities for Products.

4.3

Excess Inv entory and Obsolete Inventory During the Term .

a. Excess Inventory . The parties shall review Excess Inventory each calendar quarter at the Quarterly Business Review. Subject to the next succeeding sentence and the last sentence of this Section 4.3a , if Excess Inventory exceeds the amount of Materials that will be used to manufacture the aggregate total of Products to be purchased by Zebra over the following ninety (90) day horizon according to the Weekly Forecast for such period and such Excess Inventory remains in Manufacturer’s inventory for a period ending on the last day of the following calendar quarter, then at Zebra’s option (i) Zebra shall purchase such Excess Inventory at the following cost: (A) for Materials, at the Materials Costs; (B) for WIP [*** Redacted] and (C) for finished Products, the same pricing for which such Products were previously sold to Zebra prior to being deemed Excess Inventory; or (ii) Manufacturer shall store Excess Inventory and Zebra shall pay Manufacturer storage charges on a monthly basis for Excess Inventory at an amount equal to [*** Redacted] from Manufacturer at the respective cost set forth in the foregoing (A), (B) or (C), such charge going into effect on the first day of the calendar quarter following the calendar

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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quarter in which the Excess Inventory was recognized and ending at such time as Zebra either purchases the Excess Inventory or Manufacturer uses the Excess Inventory. Assuming Manufacturer has made all reasonable efforts to dispose of or otherwise mitigate the Excess Inventory, upon Manufacturer’s request, Zebra shall purchase, at the cost set forth in clause (i) of the immediately preceding sentence, any Excess Inventory that Manufacturer has had on-hand for a period greater than one-hundred and eighty (180) days. [*** Redacted]

b. Obsolete Inventory . Zebra shall be required to buy Obsolete Inventory from Manufacturer, at the following costs: (i) for Unique Materials, at the Materials Costs; (ii) for WIP, [*** Redacted] and (iii) for finished Products, the same pricing for which such Products were previously sold to Zebra prior to being deemed Obsolete Inventory. The parties will review Obsolete Inventory on a monthly basis and Zebra will issue a purchase order for any Obsolete Inventory for such month. Manufacturer shall at all times use Commercially Reasonable Efforts to minimize Obsolete Inventory and to mitigate the costs of Obsolete Inventory.

c. Duty to Minimize . Manufacturer shall at all times take all reasonable measures (including those requested by Zebra) to minimize the amounts payable by Zebra pursuant to this Section 4.3 , including by canceling all applicable purchase orders for Materials and reducing Materials inventory through return for credit programs or allocating such Materials for other Products, alternate company programs, if applicable, or other customer orders. Zebra will provide reasonable cooperation to assist Manufacturer with respect to the foregoing.

d. Procedure . Manufacturer shall invoice Zebra for Excess Inventory and Obsolete Inventory according to the procedures provided in Section 5.3 . All Excess Inventory and Obsolete Inventory for which Zebra has paid shall be, at Zebra’s sole option and cost, promptly destroyed according to Zebra’s written instructions per Section 3.10 , or promptly shipped to the destination designated by Zebra in the same manner as the Products pursuant to Section 4.5 and delivered to Zebra without damage.

4.4

Safety Stock . Manufacturer shall maintain a safety stock of Materials, or a vendor managed inventory program with suppliers, in order to meet Zebra’s production requirements as agreed by the parties. Safety stock levels will be reviewed by the parties at the Quarterly Business Review.

4.5

Marking and Shipping Products .

a. During Transfer Plan . Until the completion date of the Transfer Plan for a Product, Manufacturer shall ship the individual components, subassemblies and assemblies of such Product directly to the location specified in the Transfer Plan for testing and assembly by or on behalf of Zebra. Manufacturer shall ship such components to such location, to arrive by the delivery date specified in the Transfer Plan, but in no event earlier than five (5) Business Days before such date. Unless otherwise specified below, all Products shall

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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be shipped EXW the Designated Facility (INCOTERMS 2000) (except that additional or conflicting terms herein shall control over such Incoterms): (i) for Products manufactured in Mexico, DAF (INCOTERMS 2000) Nuevo Laredo, Mexico; (ii) for Products manufactured in Hungary, EXW (INCOTERMS 2000) Tiszjvaros, Hungary; and (iii) for Products manufactured in the People’s Republic of China, EXW Huangpu, China.

b. After Transfer Plan . From and after the completion date of the Transfer Plan for a Box Build, Manufacturer shall ship such Product to the Zebra receiving facility, reseller, distributor or end user designated in the corresponding Release, to arrive by the delivery date specified in such Release, but in no event earlier than five (5) Business Days before such date. From and after the completion date of the Transfer Plan for a component, subassembly or assembly of a Product, Manufacturer shall ship such Product to the Zebra receiving facility specified in the Transfer Plan, or such other facility as Zebra may specify in writing from time to time.

c. Shipping Costs . Shipping costs shall initially be paid by the party indicated in Exhibit A; provided that, if Manufacturer pays such shipping costs, then Manufacturer may pass such shipping costs on to Zebra without mark-up and shall invoice Zebra for such costs according to the procedure provided in Section 5.3 .

d. Deviations in Ship Dates . Manufacturer shall use best efforts to meet expedited delivery dates for Releases; provided that, Zebra pays all pre-approved and documented expedite fees, express freight charges and/or incremental overtime directly related to the accelerated delivery date. In the event a delivery date will be missed, Manufacturer shall notify Zebra as soon as possible, which notification shall in no way adversely affect Zebra’s remedies.

e. Marking, Packaging and Shipping Specifications. Zebra shall include in the Specifications for each Product, (i) any instructions for patent marking of such Product, and (ii) all instructions for packaging and shipping such Product (including which party shall arrange for insurance and carriage for the Product). Zebra shall have the right to unilaterally change the Specifications for marking, packaging and/or shipping any Product at any time upon reasonable notice to Manufacturer.

f. Title; Risk of Loss . In accordance with the applicable Incoterm in Section 4.5 a, title to, and risk of loss of, all Products shall occur when such Product is delivered to the destination designated in the corresponding Transfer Plan or Release.

g. Customs . Unless otherwise provided herein, all customs formalities shall be carried out consistent with the terms of sale. The Manufacturer is responsible for all exporting from the country of manufacture as well as importing into the country of manufacture required or occasioned by this Agreement. Except as provided herein, Zebra is responsible for importing into the country to which the Products are shipped by the Manufacturer pursuant to the shipping Specifications (and Manufacturer shall not be the importer of record therefor) and for exporting to the country of manufacture data and

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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other Zebra owned items. Each party, as appropriate, shall carry out all customs formalities and bear all of the costs and risks resulting therefrom, including paying the taxes, fees, costs and import duties. Each party, as appropriate, shall be responsible for obtaining any required import or export licenses necessary to ship data or Product, including certificates of origin, manufacturer’s affidavits, and U.S. Federal Communications Commission’s identifier, if applicable and any other licenses required under United States or foreign law. Each party, as appropriate, shall be the exporter or importer of record. The parties agree that neither shall export, re-export, resell or transfer, or otherwise ship or deliver any Product, assembly, component or any technical data or software which violates any export controls or limitations imposed by the United States or any other governmental authority, or to any country for which an export license or other governmental approval is required at the time of export, without first obtaining all necessary licenses and approvals and paying all duties and fees. Each party, as appropriate, shall provide the other with all licenses, certifications, approvals and authorizations in order to permit the other party to comply with all import and export laws, rules and regulations for the shipment and delivery of the Product as well as to obtain the most favorable treatment possible for the item. Zebra shall be responsible for complying with any legislation or regulations governing the importation of the Product into the country of destination and for payment of any duties thereon.

4.6

Non-conforming Products .

a. Inspection; Rejection . Notwithstanding anything herein to the contrary, Zebra shall have the right, but not the obligation, to (i) inspect all or part of each shipment of Products, (ii) sort conforming Products from Non-conforming Products, (iii) if any Non-conforming Products are identified, to inspect all Products from the affected lots and sort out Non-conforming Products and (iv) return at Manufacturer’s cost all Products from any shipments or lots containing Non-conforming Products, or only the Non-conforming Products. Zebra shall give notice to Manufacturer, specifying the grounds for rejection, within [*** Redacted] days after receipt of the relevant shipment of Products at the destination designated in the Transfer Plan or corresponding Release, after which time such Products shall be deemed accepted but subject to the preceding sentence and to the representations and warranties set forth in Sections 7.2 and 7.3 .

b. Replacement . With respect to Non-conforming Product other than a shipment of Product that is short against order, the procedure shall be as set forth in Section 7.2d .

c. Short Against Order . In the event that a shipment of Product is short against order, Manufacturer shall, within [*** Redacted] Business Days after notice, supplement such shipment with the additional Product required to fulfill the Release. If Manufacturer fails to provide the supplemental Product, Zebra may, in its sole discretion, pay the appropriate pro rata portion of the total invoice amount for such order in accordance with Section 5.3 .

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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4.7

Vendor Managed Inventory .

a. Approved Warehouses . Except as contemplated by Section 4.5 or unless Zebra specifically requests in writing (including by Weekly Forecast or Release) that Product be delivered from inventory held by Manufacturer at an Approved Warehouse, all Product delivered under this Agreement shall be delivered directly to Zebra. Manufacturer shall maintain an Approved Warehouse for each of the following Zebra facilities: Camarillo, California, Vernon Hills, Illinois, Heerenveen, the Netherlands, Shanghai, People’s Republic of China, and any other major delivery locations agreed between Zebra and Manufacturer.

b. Approved Warehouse Procedures. Manufacturer shall: (i) ensure that Zebra may withdraw Products from the Approved Warehouse(s) as needed; (ii) retain title to Products until they are physically delivered to Zebra or its carrier following withdrawal from the Approved Warehouse(s); (iii) fully insure or require the Approved Warehouse(s) operator to fully insure all Products in transit to or stored at an Approved Warehouse against all risk of loss or damage until such time as Zebra takes title to them; (iv) arrange for and undertake to perform all activities to move the merchandise to the Approved Warehouse including customs formalities and being importer of record of the Products and (v) require that each Approved Warehouse operator take all steps necessary to protect all Products in an Approved Warehouse consistent with good commercial warehousing practice. [*** Redacted] At Zebra’s discretion, Manufacturer shall either invoice Zebra on a monthly basis for the costs of storing the Products at an Approved Warehouse, which invoice shall be payable in accordance with Section 5.3 , or shall include such costs as a separate line item in the Product cost model set forth in Exhibit J . The pricing methodology for determining the exact storage cost shall be agreed by both parties prior to such charge becoming effective.

c. Inventory at Approved Warehouses . At each Quarterly Business Review, parties shall mutually agree on appropriate quantities of Products at each Approved Warehouse (the “ Stored Inventory ”). Manufacturer agrees to maintain the Stored Inventory at each Approved Warehouse. The parties acknowledge that, based upon the weekly expected quantities set forth in the Quarterly Forecast, three (3) weeks of Zebra’s expected quantities for Products constitutes the benchmark amount for the Stored Inventory. The parties shall work together to determine the appropriate inventory of a Product required for end of life of a Product. Manufacturer shall replenish the inventory at Approved Warehouses as necessary to ensure the required inventory of Products is on hand at all times.

Manufacturer shall provide Zebra weekly inventory management reports indicating the operation and activity of each Approved Warehouse with respect to prudent inventory practices. Manufacturer’s reports must include at a minimum:

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Products in transit

Product inventory on hand

Minimum/Maximum levels for inventory volumes

Product inventory reorder/replenishment points

Zebra and Manufacturer shall meet (including by telephone) periodically not less than weekly for an inventory pipeline assessment. At this meeting, inventory status at both Zebra and Manufacturer will be reviewed, along with any changes in Zebra demand.

Zebra may, on reasonable notice to Manufacturer, require stocking level verification or other similar activity to be implemented at each Approved Warehouse.

Manufacturer shall ensure that all Products held in the Approved Warehouse storage facility are delivered to meet Zebra’s production demand on a strict implementation of first-in-first-out (i.e., “ FIFO ”) inventory management practice and shall record the latest engineering revision level of the Products stored in the Approved Warehouse.

Upon receipt of each shipment of Products for an Approved Warehouse, Manufacturer shall cause such Products to be placed in segregated storage (“ Warehouse Products Storage ”) at the Approved Warehouse, partitioned or electronically marked in such a way that the Products may be readily distinguished from other inventory by physical inspection.

Promptly after each shipment of Products for an Approved Warehouse, Manufacturer shall furnish to Zebra and, if Zebra so requests, to a designated party at the Approved Warehouse storage location, a report setting forth at least the following: (a) Zebra’s Order Number; (b) Approved Warehouse storage destination; (c) origin location; (d) name of carrier and truck number or railcar number; (e) lot identification number of each lot, if applicable; (f) net weight of each lot; and (g) description and quantity of Products in each lot.

d. Performance at Approved Warehouses . Within fifteen (15) Business Days after implementation of a vendor managed inventory program, Manufacturer shall provide Zebra with all key performance indicators applicable to Manufacturer’s management of Product inventory at the Approved Warehouses and monitored by Manufacturer, which shall include all generally accepted United States industry standards (e.g., inventory value, inventory turns, fill rates) and which, when approved by Zebra as provided below, shall be appended as Exhibit K to this Agreement. If a new Product added to this Agreement requires special or additional key performance indicators, Exhibit K shall be amended to reflect the parties’ mutual agreement on such key performance indicators. Exhibit shall also include a mechanism for evaluating and scoring Manufacturer’s performance of the key performance indicators, consistent with generally accepted United States industry standards. Manufacturer shall monitor, evaluate and score its performance with respect to such key performance indicators and shall provide Zebra with a quarterly

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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report of such performance and discuss each such report with Zebra at the next Quarterly Business Review. Zebra shall have the right to terminate this Agreement for cause for Manufacturer’s failure to achieve the key performance indicators, as such right to terminate shall be further described in Exhibit K . Exhibit K shall be subject in its entirety to Zebra’s approval prior to appending to this Agreement, and Zebra may terminate this Agreement upon ten (10) Business Days notice if the parties are unable to reach agreement upon the terms of Exhibit K within fifteen (15) Business Days after implementation of a vendor managed inventory program .

4.8

Communications . Manufacturer shall comply with Zebra’s communications processes with Zebra’s vendors, including any electronic data interchange (EDI) procedures.

Article V.

Pricing; Payments

5.1

Pricing .

a. Pricing Method .

(i)

Production Pricing. All Product prices shall at all times be at production pricing (i.e., excluding all ramp costs).

(ii)

[*** Redacted] . Pricing shall be determined based upon [*** Redacted] . Manufacturer agrees that [*** Redacted] . Such [*** Redacted] shall only be applied as set forth in Exhibit J . [*** Redacted]

(iii)

Marking, Packaging and Shipping Costs. All prices shall include marking and packaging costs and applicable Incoterms under the applicable terms of sale and as may be identified in the respective Specifications for a Product. Prices shall not include shipping costs.

(iv)

Notification of Costs. Notwithstanding any binding forecast or Release or anything else in this Agreement to the contrary, under no circumstances shall Zebra be compelled to purchase any Product until Manufacturer shall have advised Zebra in writing of, and Zebra shall have agreed to, all of the Materials Costs, Value-Added Costs and SG&A Costs for such Product.

b. Initial Price . The initial price for each Product shall be as set forth in Exhibit A in U.S. dollars.

c. Price Adjustments. [*** Redacted] the parties shall determine Product pricing [*** Redacted] . Prices shall [*** Redacted] . Without limiting the foregoing, the parties shall [*** Redacted] . All price adjustments of each Product shall [*** Redacted] . Exhibit A of this Agreement shall be updated [*** Redacted] by price sheet posted to Zebra’s FTP

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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site as necessary to adjust the price of each Product to account for changes expressly provided for in this Agreement. Neither party shall be [*** Redacted] .

5.2

Product Costs .

a. Cost Model . The parties agree that Product costs shall be [*** Redacted] . Exhibit J sets forth [*** Redacted] .

b. Bill of Materials Review . Manufacturer shall [*** Redacted] provide Zebra with [*** Redacted] . It is the parties’ expectation and intent that [*** Redacted] . Manufacturer shall [*** Redacted] . For further clarification, an example [*** Redacted] is set forth in Exhibit N . In the event that Zebra [*** Redacted].

c. Cost Reduction Initiatives . In addition to other cost reduction mechanisms provided herein, both parties shall establish mutually agreed cost reduction targets on an annual basis prior to the beginning of Zebra’s fiscal year by methods such as elimination of Materials, obtaining alternate sources of Materials, redefining Specifications, and improved assembly or test methods. The cost targets will consist of specific cost reduction initiatives mutually identified by both parties. These initiatives will be broken down by achievable target dates and tracked on a quarterly basis. An ongoing measurement shall be established to track cumulative quarterly costs savings. The format for establishing and tracking the various cost savings initiatives is detailed in Exhibit L . [*** Redacted] The parties shall mutually agree on the responsibility for any investment costs related to a particular cost savings initiative prior to beginning such cost savings initiative. All changes to implement cost reductions must be approved by Zebra in advance and must be in compliance with the Bill of Materials approved by Zebra and the Approved Vendor List.

5.3

Invoice and Payment Procedure . For each shipment of Products delivered hereunder, Manufacturer shall provide to Zebra an invoice (a) referencing the purchase order set forth in Section 4.2 and, for components, subassemblies and assemblies, the Transfer Plan or relevant Release number, and (b) specifying the amount of each Product delivered, the price of each Product, the total invoice amount (in U.S. dollars) and date of delivery of the Products. Manufacturer shall not issue any such invoice earlier than the respective date of shipment of the corresponding Products. For Services performed hereunder pursuant to an SOW or COR/COA, Manufacturer shall invoice Zebra upon Zebra’s acceptance of associated deliverables or Services delivered by Manufacturer to Zebra according to acceptance criteria set forth in such SOW or COR/COA, for all fees and NRE Costs (excluding those non-depreciable NRE Costs for which Manufacturer is responsible pursuant to Section 3.6 ) under such SOW or COR/COA that are consistent with the budget set forth therein and other fees and NRE Costs (excluding those non-depreciable NRE Costs for which Manufacturer is responsible pursuant to Section 3.6 ) pre-approved by Zebra. Manufacturer shall also invoice Zebra for its actual cost of any (a) Unique Tooling for which Zebra has agreed to pay in connection with any SOW or COR/COA, or pursuant to Section 3.4a , (b) rework of any WIP or finished Products

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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pursuant to a COR/COA, or (c) Excess or Obsolete Inventory pursuant to Section 4.3 . Provided that Manufacturer has complied with the foregoing invoicing guidelines and there is no good faith dispute related to such invoice or acceptance of such deliverables or Services, Zebra shall pay each such invoice according to the terms set forth in the Transfer Plan or relevant Release, SOW or COR/COA or, if no such terms are stated therein, within forty-five (45) days after its receipt of such invoice.

5.4

Taxes; Fees . Manufacturer shall be responsible for payment of all Manufacturer Taxes. Zebra shall be responsible for taxes as expressly set forth in Exhibit J . Under no circumstances shall either party be responsible for any United States or foreign, local, state or federal tax on the net income of the other party.

5.5

Currency .

a.	Manufacturer will invoice in U.S. dollars as agreed with Zebra in Exhibit A of this Agreement, and remain fixed in that currency unless otherwise mutually agreed by both parties in writing.

For materials that are purchased outside of the currencies identified in Exhibit A of this Agreement, pricing will be reset quarterly based on calendar quarters. Manufacturer will attempt to carry out all transactions and quoting will be carried out in U.S. dollars before proceeding to any other currency.

c.	For the purpose of establishing invoice prices, the exchange rates will be derived from the sources specified in Exhibit M on the second to last Thursday of the last month of each calendar quarter (i.e. March, June, September and December).

d.	As part of the pricing process in Section 5.1c , the parties shall establish the invoice prices for the next three (3) month period. The invoice prices shall be established based on the following principles:

(i)

Materials Costs and Value Add Costs, which are priced in various currencies, shall be recalculated into the invoicing currency at the exchange rates as established under Exhibit M .

(ii)

In general, the parties agree that under the Agreement, there will be a reconciliation process for realized foreign currency gains and losses (as set forth on the quarterly income statement provided to Zebra in accordance with Section 0 above) that exceed five percent (5.0%) for the previous calendar quarter. Any such realized foreign currency gains or losses shall be passed on to Zebra in the Product price.

Article VI.

Confidentiality; Publicity

6.1

Confidential Information . During the Term of this Agreement, each party may discover, receive, or otherwise acquire, whether directly or indirectly, non-public

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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information or materials related to the other party or its Affiliates or shareholders, or its or their businesses, or information of third parties that the other party is obligated to keep confidential (collectively, “ Confidential Information ”). For the avoidance of doubt, all of the Zebra Technology shall be the Confidential Information of Zebra, and all of the Manufacturer Technology shall be the Confidential Information of the Manufacturer. Confidential Information shall not include information that: (i) is, or becomes, publicly known through no wrongful act of the receiving party or its officers, employees, consultants or contractors; (ii) is received by the receiving party without restriction from a third party without breach of any obligation of nondisclosure; or (iii) was known to a party prior to receipt of information or materials from the other party, as demonstrated by written documentary evidence.

6.2

Non-Disclosure of Confidential Information . Confidential Information of a party has substantial value to such party, which value would be impaired if such information or materials were improperly used or disclosed to third parties. Accordingly, the party in receipt of the other party’s Confidential Information shall (i) use such Confidential Information solely for purposes of this Agreement and (ii) disclose such Confidential Information only to its officers, employees, consultants and contractors whose duties relate to this Agreement and reasonably require familiarity with such information in order for such party to perform its obligations hereunder. The receiving party shall obtain from any such consultant or contractor and, if Manufacturer, also from its employees, a legally enforceable written agreement not to disclose the other party’s Confidential Information, or knowledge or know-how derived therefrom, to any other Person or use such Confidential Information for any purposes other than those contemplated by this Agreement. Each party shall take such precautions to protect the other party’s Confidential Information from disclosure or misappropriation as it takes for its own most highly sensitive information (but in no event shall such party use less than a reasonable degree of care) and shall be responsible for compliance with the restrictions in this Agreement by its Affiliates and the officers, employees, consultants and contractors of itself and its Affiliates. The confidentiality obligation set forth in this Agreement shall be observed during the Term of the Agreement and after the Term of this Agreement for an indefinite period of time for trade secrets and for a period of two (2) years following the termination of this Agreement for all other types of Confidential Information.

6.3

Non-Disclosure of Agreement . The terms and conditions of this Agreement, and all information required to be provided from one party to another under the terms and conditions of this Agreement, shall be deemed Confidential Information that is subject to the non-disclosure provisions of Section 6.2 ; provided that, each party shall be permitted to disclose the terms and conditions of this Agreement to actual or potential acquirers, investors and lenders and their respective representatives under written confidentiality agreements at least as protective of the disclosing party’s rights as the terms and conditions of this Article VI.

6.4

Exceptions . The confidentiality obligations of the receiving party under this Article VI shall not apply solely to the extent that any information is required to be publicly disclosed

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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pursuant to a governmental or judicial requirement or other requirement of Law, but only after notifying the party owning such information of such requirement prior to disclosure and cooperating with the owner to eliminate or minimize such disclosure requirement to the greatest extent possible and to obtain confidential treatment for all Confidential Information to be disclosed.

6.5

Return or Destruction of Confidential Information . Upon request of either party, and in any case upon expiration or termination of this Agreement (except to the extent and only for so long as a party has rights to use such Confidential Information under a license that survives termination of this Agreement or must retain Confidential Information to perform obligations for the other party that continue after termination pursuant to Section 8.6 ), each party shall promptly return to the other party or destroy (and certify such destruction in writing) all of the other party’s Confidential Information, including all copies, excerpts or summaries thereof, in whatever form or medium. Thereafter, both parties shall make no further use, either directly or indirectly, of any such Confidential Information.

6.6

Publicity . Without limiting the generality of the foregoing terms of this Article VI, neither party shall make any press release or similar public statement or, subject to Section 6.4 , otherwise generally disclose the existence of arrangements between Zebra and Manufacturer or the existence of this Agreement, without the other party’s prior consent.

Article VII.

Representations And Warranties; Indemnification

7.1

General Representations and Warranties . Zebra hereby represents and warrants to Manufacturer, and Manufacturer hereby represents and warrants to Zebra, as follows:

a. Corporate Existence and Power. Such party: (i) is duly organized and validly existing under the laws of the state or country in which it is incorporated or formed and duly qualified under the laws of each jurisdiction where its ownership or lease of property or the conduct of its business requires such qualification; (ii) has the requisite power and authority and the legal right to own and operate its property and assets, to lease the property and assets it operates under lease, and to carry on its business as it is now being conducted; (iii) is in compliance with all requirements of applicable laws and regulations, except to the extent that any noncompliance would not materially adversely affect such party’s ability to perform its obligations under this Agreement; and (iv) is in compliance with its formation documents.

b. Authorization and Enforcement of Obligations . Such party: (i) has the requisite power and authority and the legal right to enter into this Agreement and to perform its obligations hereunder, without any violation of its formation documents; and (ii) has taken all necessary action on its part to authorize the execution and delivery of this Agreement and the performance of its obligations hereunder. This Agreement has been duly executed and delivered on behalf of such party, and constitutes a legal, valid, binding obligation, enforceable against such party in accordance with its terms.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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c. Consents . All necessary consents, approvals and authorizations of all governmental authorities and other Persons required to be obtained by such party in connection with the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby and the performance of its obligations hereunder have been obtained.

d. No Conflict . The execution and delivery of this Agreement and the performance of such party’s obligations hereunder (i) do not conflict with or violate any requirement of applicable laws or regulations of any governmental instrumentality or any contractual obligation of such party, and (ii) do not conflict with, or constitute a default or require any consent under, any contractual obligation of such party.

7.2

Product-Specific Warranties .

Manufacturer represents, warrants and covenants to Zebra that all Products and Services delivered by Manufacturer under this Agreement shall (i) be manufactured and performed (as applicable) in a competent, professional and workmanlike manner, including compliance with ISO 9001-2000, IPC-A 610 Class 2 Standards and Specifications, (ii) at the time of delivery, strictly conform to the Specifications, [*** Redacted] (collectively, the “ Warranty ”).

b.	The parties acknowledge and agree that for the purposes of this Section 7.2, the Warranty [* Redacted] . Manufacturer shall [* Redacted] and shall [* Redacted] . Without limiting the foregoing, Manufacturer shall [* Redacted] .

The Warranty shall not apply to any Product to the extent that such Product suffers a Defect due to (i) the Specifications or design of the Product, (ii) tooling or other materials provided by Zebra, (iii) alteration or repair work by any party other than Manufacturer (except to the extent authorized by Manufacturer) or (iv) use of a Product in contravention of the Specifications.

If any Product suffers a Defect, Zebra will notify Manufacturer, and Manufacturer shall repair or replace, at Manufacturer’s sole option and Manufacturer’s cost and expense, any such Product. Manufacturer shall provide an RMA number to Zebra within twenty-four (24) hours after receipt of Zebra’s notice of a Defect. Products returned to Manufacturer pursuant to an RMA shall be deemed to be the property of Manufacturer, including all risk of loss, and Zebra shall not be obligated to make any further payment for such Products. Manufacturer shall pay for all costs for the return of any Product to Manufacturer and for the shipment of any Product back to Zebra or to Zebra’s customer to whom such Product was originally drop shipped. Manufacturer shall promptly analyze any such RMA Product and, if a Defect is found, then Manufacturer shall repair or replace the RMA Product within twenty (20) Business Days of receipt by Manufacturer of the RMA Product and all required associated documentation. Zebra shall bear responsibility for all transportation costs to and from Manufacturer’s designated repair facility and diagnostic costs as agreed upon by the parties for non-Defective Products.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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This Warranty (and the warranties set forth in Section 7.3 ) shall survive inspection, acceptance, and payment by Zebra and shall extend to Zebra and its Affiliates. Manufacturer shall not reject any Warranty claim on the basis that the claim arose after the Product or spare part has been sold or transferred by Zebra, or its Affiliates, to other parties. Zebra will not make any representations to end users or other third parties on behalf of Manufacturer, and Zebra will expressly indicate that the end users and third parties must look solely to Zebra in connection with any problems, warranty claim or other matters concerning the Product.

f.	For any Product repaired as a result of a Warranty issue, the Warranty period shall extend for the longer of ninety (90) days from date of shipment of the Product after repair and the remainder of the original Warranty period.

g.	[* Redacted] . Manufacturer shall [* Redacted] in its efforts to [* Redacted]** .

Notwithstanding anything herein to the contrary, the RMA procedure for a Box Build shall be as set forth in the respective Transfer Plan for such Box Build, which procedure the parties shall negotiate in good faith, subject to legal review by the parties. In the event the parties fail to obtain legal review, then the RMA procedure in this Section 7.2 shall apply.

7.3

Epidemic Failures .

In the event an Epidemic Failure occurs, or in a party’s reasonable belief is likely to occur, with respect to a Product during the Warranty Period, the party having knowledge of such Epidemic Failure shall inform the other party as soon as possible about the event. Manufacturer shall immediately propose a containment action plan and, as soon thereafter as reasonably possible, a corrective action plan. Manufacturer shall implement the proposed corrective action plan (including root cause analysis) promptly upon approval by Zebra.

b.	If it is determined based on a joint root cause analysis that an Epidemic Failure exists, then the following costs and expenses incurred by Zebra or Manufacturer as a direct result of the foregoing shall be borne by Manufacturer [* Redacted]** .

c.	In the event that an Epidemic Failure occurs, the Warranty Period shall extend for the longer of ninety (90) days from shipment of the Product after repair and the remainder of the original Warranty Period.

d.	So long as an Epidemic Failure occurs during the Warranty Period, Zebra shall have the right to the remedies set forth in (b) above, whether such remedies are exercised during the Warranty Period or after expiration of the Warranty Period.

e.	If Zebra desires to seek corrective action with respect to a safety or regulatory concern that is not caused by Manufacturer’s by breach of the warranty as set out in the definition

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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of “Epidemic Failure,” then the parties shall cooperate to develop a plan for Manufacturer to assist Zebra in such corrective action and in cooperating with any regulatory agencies.

7.4

Certain Representations, Warranties and Covenants of Manufacturer . Manufacturer hereby represents, warrants and covenants to Zebra that: (a) it has, and shall have, adequate facilities and equipment and sufficient technical capability and know-how to manufacture, package, label and supply the Products to or for Zebra and its Affiliates according to the Specifications and other terms and conditions of this Agreement, including ISO 9001-2000 standards; (b) it and shall obtain and maintain any local, national and international approvals required to manufacture and supply the Products to Zebra; (c) it shall comply with all applicable Laws in performing the Services; (d) use of its own manufacturing processes, techniques, materials and internal specifications to manufacture the Products does not and will not infringe or misappropriate the rights of any third party; (e) the use, reproduction, manufacture, sale, offer for sale, distribution and importation of any Work Product will not infringe or misappropriate the rights of any third party; (f) all Products supplied to Zebra shall include labeling, packaging and inserts that conform with the final labeling, packaging and inserts approved by Zebra; (g) Zebra shall receive good title to all Products delivered hereunder, free and clear of any security interests, liens, charges or other encumbrances of any kind (collectively, a “ Lien ”); (h) Manufacturer shall not create or permit to exist any Lien over any of Zebra’s property (including tooling, equipment, fixtures or molds) or any of the Products; and (i) it has not agreed to pay any commission, gift, compensation or other payment in connection with performance of the Services or the manufacture or sale of Products to Zebra. If Manufacturer becomes aware that any of the foregoing representations, warranties or covenants was untrue in any material respect upon the Effective Date or that any become untrue in any material respect during the term of the Agreement, then Manufacturer shall promptly notify Zebra and provide details of the same.

7.5

Disclaimer . THE REMEDIES SET FORTH IN SECTIONS 7.2, 7.3, 7.6a AND 8.2 SHALL CONSTITUTE ZEBRA’S SOLE AND EXCLUSIVE REMEDY FOR A BREACH OF THE WARRANTY MADE BY MANUFACTURER IN SECTION 7.2 .

EXCEPT TO THE EXTENT OF ANY EXPRESS WARRANTIES SET FORTH IN THIS AGREEMENT, EACH PARTY EXPRESSLY DISCLAIMS, AND EXPRESSLY WAIVES, ALL OTHER WARRANTIES AND REPRESENTATIONS OF ANY KIND WHATSOEVER WHETHER EXPRESS, IMPLIED, STATUTORY, ARISING BY COURSE OF DEALING OR PERFORMANCE, CUSTOM, USAGE IN THE TRADE OR OTHERWISE, INCLUDING COMPLIANCE WITH MATERIALS DECLARATION REQUIREMENTS, ANY WARRANTY OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE OR INFRINGEMENT OR MISAPPROPRIATION OF ANY RIGHT, TITLE OR INTEREST OF ANY THIRD PARTY.

ZEBRA UNDERSTANDS AND AGREES THAT, WITH RESPECT TO ANY PRODUCT, IT SHALL HAVE FULL AND EXCLUSIVE LIABILITY, WHETHER

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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FOR PRODUCT DESIGN LIABILITY, PRODUCT LIABILITY, DAMAGE TO PERSON OR PROPERTY AND/OR INFRINGEMENT OR MISAPPROPRIATION OF THIRD PARTY RIGHTS, EXCEPT IN EACH CASE TO THE EXTENT THAT THE SAME ARISES FROM MANUFACTURER’S FAILURE TO FOLLOW SPECIFICATIONS OR IS COVERED BY AN EXPRESS MANUFACTURER WARRANTY OR INDEMNITY SET FORTH IN THIS AGREEMENT OR ARISES FROM MANUFACTURER’S FAILURE TO PERFORM OBLIGATIONS UNDER SECTIONS 3.8d, 3.8e, 3.15, 3.16 OR 3.17 .

NO ORAL OR WRITTEN STATEMENT OR REPRESENTATION BY MANUFACTURER, ITS AGENTS OR EMPLOYEES SHALL CONSTITUTE OR CREATE A WARRANTY OR EXPAND THE SCOPE OF ANY WARRANTY HEREUNDER.

7.6

Indemnification .

a. Manufacturer’s Indemnities . Manufacturer agrees to indemnify, defend and hold harmless Zebra and its employees, Affiliates, successors and assigns (collectively, “ Zebra Indemnified Parties ”) from and against all Loss arising from any third party claims asserted against any Zebra Indemnified Party that is based in part or in whole on [*** Redacted]

b. Zebra’s Indemnities . [*** Redacted] Zebra hereby agrees to defend, indemnify and hold harmless Manufacturer and its Affiliates, employees, successors and assigns (collectively, the “Manufacturer Indemnified Parties”) from and against all Loss arising from any third party claim asserted against any Manufacturer Indemnified Party to the extent based on any of the following: (a) except in each case to the extent that Manufacturer has contributed to any of the items in this subsection (a), [*** Redacted] ; (b) that any item in subsection (a) [*** Redacted] , (c) except in each case to the extent that [*** Redacted] , (d) any [*** Redacted] , or (e) [*** Redacted] .

c. Notification and Procedure for Claims . Upon receipt of notice, whether formal or informal, direct or indirect, of any claim for which indemnification may be available under this Article VII , the party receiving notice shall promptly notify the other, and the management of both parties shall meet to discuss how to handle the matter. The indemnifying party shall promptly assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. The indemnified party shall reasonably cooperate with the indemnifying party or its counsel, at the indemnifying party’s expense, in its defense, settlement or other resolution of the claim. The indemnified party shall have the right to participate in the defense thereof and to employ counsel, at its own expense, separate from the counsel employed by the indemnifying party; provided that if such counsel is necessary because of a conflict of interest with the indemnifying party or its counsel or because the indemnifying party does not assume control of the defense of a claim for which it is obligated to indemnify the other party hereunder, then the indemnifying party shall bear such expense. The indemnifying party shall not, without

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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the indemnified party’s prior consent (not to be unreasonably withheld) enter into any settlement that requires the indemnified party to take any action, release any rights or pay any money other than for monetary damages for which the indemnifying party will indemnity the indemnified party.

7.7

Limitation of Liabilities .

a. Exclusion of Consequential Damages . UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR TO ANY OTHER PERSON OR ENTITY UNDER ANY CONTRACT, TORT, STRICT LIABILITY, NEGLIGENCE, OR OTHER LEGAL OR EQUITABLE CLAIM OR THEORY FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL, OR INDIRECT DAMAGES, LOSS OF GOODWILL OR BUSINESS PROFITS, LOST REVENUE, WORK STOPPAGE, DATA LOSS, COMPUTER FAILURE OR MALFUNCTION, OR FOR ANY EXEMPLARY OR PUNITIVE DAMAGES, WHETHER SUCH PARTY WAS INFORMED OR WAS AWARE OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE, EXCEPT IN EACH CASE WITH RESPECT TO (i) ANY LOSSES INDEMNIFIED BY SUCH PARTY PURSUANT TO SECTION 7.6 (AS LOSS IS DEFINED FOR PURPOSES OF SECTION 7.6 ), (ii) LOSSES ARISING FROM A PARTY’S BREACH OF CONFIDENTIALITY OBLIGATIONS HEREUNDER, OR (iii) LOSSES ARISING FROM A PARTY’S VIOLATION OF THE OTHER PARTY’S INTELLECTUAL PROPERTY RIGHTS.

[*** Redacted]

b. Exceptions Under Law . NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, NOTHING IN THIS SECTION 7.7 SHALL EXCLUDE OR LIMIT EITHER PARTY’S LIABILITY FOR DEATH OR PERSONAL INJURY RESULTING FROM ITS NEGLIGENCE TO THE EXTENT THAT SUCH LIABILITY CANNOT BY LAW BE LIMITED OR EXCLUDED.

7.8

Remedies under Other Agreements . Notwithstanding anything herein to the contrary, nothing herein shall limit Zebra’s remedies under any separate design services agreement as contemplated by Section 2.1b .

7.9

Insurance .

a. Insurance to be Carried by Manufacturer . During the Term of this Agreement, Manufacturer shall carry and maintain in full force and effect the insurance coverage stated below in subsection b . All insurance policies providing such coverage must be written on an occurrence basis. The insurer(s) providing such coverage must be licensed and admitted in the state of California and have a rating of “A” and policyholder’s surplus size “VII” or better as listed in the then-current Best’s Insurance Report published by A.M. Best Company, Inc. All insurance coverage shall protect Manufacturer and Zebra and each of the Additional Insured from and against all Loss arising from death, bodily

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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injury or tangible property damage to the extent a claim relating thereto is based on Manufacturer’s negligence.

b. Minimum Insurance Requirements . The required insurance coverage and limits which Manufacturer shall obtain and maintain shall include the following:

[*** Redacted]

c. Retentions . [*** Redacted] must be accepted by Zebra, such acceptance not to be unreasonably withheld. [*** Redacted] .

d. [*** Redacted] . Manufacturer shall [*** Redacted] insurance policy obtained by Manufacturer pursuant to the requirements contained in this Section 7.9 . [*** Redacted]

e. [*** Redacted]

Before commencement of this Agreement and prior to Zebra having any obligation [*** Redacted] Manufacturer shall [*** Redacted] . Further, the [*** Redacted] . [*** Redacted] policy that meets the minimum insurance coverage set forth in subsection b of this Section 7.9.

Zebra’s approval of any of Manufacturer’s insurance coverage does not relieve or limit any of Manufacturer’s obligations under this Agreement, for claims exceeding required insurance limits.

In no event shall Zebra’s allowing Manufacturer to begin or complete its obligations under this Agreement, or acceptance of any such performance or payment therefore, be construed as a waiver of the Zebra’s right to assert a claim against Manufacturer for breach of Manufacturer’s obligations under this Section 7.9 , or to declare Manufacturer in default of this Agreement for failure to comply with any of Manufacturer’s obligations under this Section 7.9 , all and each of which are deemed material.

Article VIII.

Term And Termination

8.1

Term . The initial term of this Agreement shall be three (3) years from the Effective Date (the “ Initial Term ”). Thereafter, this Agreement shall automatically renew for successive one (1) year periods (each a “ Renewal Term ”) unless, prior to the relevant term, either party provides not less than one hundred eighty (180) days prior written notice to the other party of its intent not to renew this Agreement.

8.2

Termination for Breach . Either party may terminate this Agreement (or, at the option of the non-breaching party, any portion thereof relating to a Product with respect to which a breach relates) upon notice to the other party in the event that the other party breaches any material term or condition of this Agreement (including the provisions of Section 7.9 ), if

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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such breach remains uncured for longer than thirty (30) days after receipt of notice from the non-breaching party.

8.3

Additional Termination Rights .

a. Zebra. Zebra shall also have the right to terminate this Agreement without regard to any other provisions herein regarding notice periods, (i) at any time, for any or no reason, [*** Redacted] (ii) upon notice, upon Manufacturer’s Change of Control, (iii) upon notice, in the event of an Epidemic Failure, or (iv) upon notice, if Manufacturer breaches the insurance provisions of Section 7.9 and such breach has resulted in Loss to Zebra, or (v) upon notice, [*** Redacted] .

b. Manufacturer . Manufacturer shall also have the right to terminate this Agreement without regard to any other provisions herein regarding notice periods, at any time, for any or no reason, [*** Redacted] prior notice to Zebra.

8.4

Partial Termination . In the event that either party has the right to terminate this Agreement as to any Product, then such party shall have the right, in its sole election, to terminate this Agreement with respect to only such Product, in which case this Agreement shall continue in full force and effect with respect to all other Products. Similarly, a party may elect not to renew this Agreement with respect to any Product, in which case this Agreement shall continue in full force and effect with respect to all other Products for which the Agreement is renewed. In connection with termination of this Agreement with respect to only certain Products, each provision of this Agreement related to termination shall, where context permits, apply in connection with only such terminated Products.

8.5

Termination for Insolvency . This Agreement shall terminate without the need for further action by either party: (a) in the event that the other party becomes insolvent or generally fails to pay, or admits in writing its inability to pay its debts as they become due; (b) the other party ceases active operation of its business; (c) the other party adopts a resolution for discontinuance of its business or for dissolution; or (d) the other party takes any corporate or similar action authorizing any of the foregoing.

8.6

Effect of Termination .

a. Outstanding Orders . Upon expiration or termination of this Agreement for any reason except Zebra’s non-payment of undisputed amounts, with respect to any portion of a binding forecast for a component, subassembly or assembly Product, or a Release for a Box Build, that remains outstanding at the time of termination, Manufacturer shall either, in Zebra’s sole discretion (i) complete, in whole or in part at Zebra’s sole discretion, Manufacturer’s obligations under this Agreement with respect to such binding forecast or Release, or (ii) terminate all work and commitments made under or pursuant to this Agreement with respect to such binding forecast or Release as quickly and effectively as

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possible, in which event Manufacturer shall provide Zebra written proof that such termination has been accomplished in a timely manner.

b. Payments Upon Termination . In the event of termination of all of part or this Agreement, then Zebra shall pay amounts due and owing for (i) the affected Obsolete Inventory in accordance with Section 5.3 and (ii) affected Unique Tooling; in each case provided that Manufacturer has delivered all such Obsolete Inventory and Unique Tooling to Zebra without any damage and has handled Unique Tooling as provided in Section 3.7 .

c. Duty to Minimize Costs . In every case, Manufacturer shall take all reasonable measures (including those requested by Zebra) to minimize the amounts payable by Zebra pursuant to this Section 8.6 , including by canceling all applicable purchase orders for Materials and reducing Materials inventory through return for credit programs or allocating such Materials for other Products, alternate company programs, if applicable, or other customer orders. Zebra will provide reasonable cooperation to assist Manufacturer with respect to the foregoing.

d. Outstanding SOWs . SOWs outstanding upon expiration or termination of this Agreement shall be handled according to Section 3.12(ix) .

e. Materials Transfer . Upon expiration or termination of this Agreement for any reason, in Zebra’s sole discretion and upon full payment by Zebra of all amounts due and owing for such items, Manufacturer shall promptly transfer to Zebra according to Zebra’s reasonable instructions, all Unique Tooling, Materials, orders for Materials, Obsolete Inventory, WIP and finished Products in Manufacturer’s possession or control. If the Agreement expires without renewal or is terminated by Manufacturer for cause pursuant to Section 8.2 or is terminated by Zebra pursuant to Section 8.3a(i) or terminated pursuant to Section 8.5 as a result of Zebra’s bankruptcy or insolvency, then Zebra shall pay the cost of transferring such materials. If the Agreement is terminated for any other reason, then Manufacturer shall pay the cost of transferring such materials. In addition, Manufacturer shall consent to Zebra, or any Person on Zebra’s behalf, contracting directly with any vendor on the Approved Vendor List.

f. Survival . Termination of this Agreement for any reason shall not relieve the parties of any obligation accruing prior to such expiration or termination. Any provisions of this Agreement that by their terms or nature will or may entail obligations to be performed after termination shall survive such termination until they are performed. Notwithstanding anything herein to the contrary, the following provisions shall survive indefinitely (or for such shorter period as specifically referenced in the particular section) the expiration or termination of this Agreement for any reason: Sections 1.1 1.5, 2.3b (further assurances), 2.3d, 2.4c, 2.4d, 2.4f (duty to collect and delivery), 2.5, 2.6a (as provided therein), 2.6b (as provided therein), 3.15 (as provided therein), 3.17 (as provided therein), 3.19, 4.6 and 8.6 and Article VI, Article VII, Article IX, and Article X .

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Article IX.

Miscellaneous

9.1

Assignment . Zebra is entering into this Agreement based upon the special knowledge, skill and abilities of Manufacturer and, as a result thereof, providing Manufacturer with Confidential Information and a non-transferable license to Zebra Technology. Accordingly, neither this Agreement, nor any license granted to Manufacturer hereunder, may be assigned or otherwise transferred, including by Change of Control, by Manufacturer without Zebra’s prior written consent. Any attempted assignment or transfer by Manufacturer of its rights or obligations under this Agreement shall be void and of no affect, unless the prior written consent of Zebra has been obtained. Notwithstanding the foregoing, Manufacturer shall have the right to assign its rights to receive monies hereunder without the prior consent of Zebra. Zebra may assign or otherwise transfer this Agreement (and all rights and licenses hereunder): (i) pursuant to a Change of Control; (ii) to an Affiliate; or (iii) otherwise to a third party with the prior consent of Manufacturer.

9.2

Successors . The terms and conditions of this Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their respective permitted successors and assigns.

9.3

No Third Party Beneficiaries . This Agreement shall not be deemed to confer any rights or remedies upon any person not a party hereto, except for the indemnities and Warranty.

9.4

Bankruptcy Events . The rights and licenses granted to Zebra under this Agreement are and shall otherwise be deemed to be, for the purposes of Section 365(n) of the United States Bankruptcy Code and similar or related laws in other jurisdictions, a license of “intellectual property” rights as defined in Section 101(35A) of the United States Bankruptcy Code or under similar or related laws in other jurisdictions. Zebra, as licensee of intellectual property rights under this Agreement, may fully exercise all of its rights under the United States Bankruptcy Code or any similar or related laws of other jurisdictions, including, without limitation, its right to continue to exercise the intellectual property rights licensed hereunder, notwithstanding any rejection or assignment of this Agreement by Manufacturer; provided that in the event that Zebra elects to exercise such rights, it shall also be obligated to make all payments hereunder not disputed in good faith.

9.5

Dispute Resolution .

a. Exclusive Procedure . Any Dispute between the parties shall be resolved as provided in this Section 9.5 , which shall be the sole and exclusive procedure for the resolution of Disputes. Notwithstanding the foregoing, each party may institute formal proceedings at any time to seek a preliminary injunction or other provisional judicial relief, if in its sole judgment such action is necessary to avoid irreparable damage (including as a result of a failure to supply Product) or to preserve the status quo. Despite such action, the parties shall continue to participate in good faith in the procedures specified in this Section 9.5 .

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Any provisional relief obtained pursuant to this Section 9.5a shall be limited as appropriate to preserve the jurisdiction of the American Arbitration Association to resolve the Dispute between the parties.

b. Escalation; Arbitration . The parties shall first attempt in good faith to resolve any Dispute between them by negotiation among the Project Team. Either party may give the other party notice of any Dispute not resolved in the normal course of business. Within five (5) Business Days after receipt of such notice, the receiving party shall submit to the other a written response. The notice and the response shall include a statement of each party’s position, a summary of arguments supporting that position and any supporting documentation. Within five (5) Business Days after receipt of the response by the other party, the Project Team shall meet at a mutually agreeable time and place, and thereafter as often as they reasonably deem necessary, to attempt to resolve the Dispute.

c. Executives’ Negotiation . If the Project Team is unable to resolve, or does not anticipate resolving, the Dispute within thirty (30) days (or such longer period as the parties may agree) after notice of such Dispute is received by the non-disputing party, then the Dispute shall be referred to executives at Zebra and Manufacturer who have authority to settle the Dispute and who are at a higher level of management than the persons who comprise the Project Team. Such executives shall attempt to resolve the Dispute by good faith negotiation.

d. Formal Proceedings . If the parties’ executives are unable to resolve any Dispute within ten (10) Business Days (or such longer period as the parties may agree) after such Dispute is referred to them, then a party may pursue arbitration in accordance with Section 9.5(e) after providing notice to the other party. Except as provided in Section 9.5a , neither party may bring a formal proceeding relating to any Dispute arising out of or relating to this Agreement until the dispute resolution and escalation procedures set forth in this Section 9.5 have been exhausted.

e. Binding Arbitration . In accordance with Section 9.5d and except as permitted by Section 9.5a , any Dispute not resolved by the escalation procedures set forth in this Section 9.5 shall be resolved by binding arbitration, and each party hereby waives any right to institute a court or other dispute resolution proceeding with respect to such Dispute and acknowledges arbitration in accordance with this Section 9.5e as the sole and exclusive means of resolving such Dispute. The Commercial Rules of the American Arbitration Association, as modified herein, shall apply to such arbitration. The arbitration shall be heard and determined by a panel of three (3) arbitrators, each of whom shall be a disinterested attorney having experience and familiarity with manufacturing and supply arrangements in the thermal on demand printer industry. Each party shall choose one (1) arbitrator, with the third arbitrator chosen by agreement of the two (2) arbitrators chosen by the parties. In the event the two (2) arbitrators chosen by the parties cannot agree on a third arbitrator, such third arbitrator shall be selected by the American Arbitration Association. The arbitrators shall decide all disputes primarily based on the terms of this Agreement and secondarily on the laws of the State of Illinois, United States of America

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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(without regard to conflicts of law principles). The decision of a majority of the arbitrators shall be final and binding on the parties and may be enforced before any court of competent jurisdiction in accordance with Section 9.6 and cannot be the subject of any appeal. The arbitration proceeding shall occur in Chicago, Illinois, and be conducted in the English language, each party shall bear its own costs relating to such arbitration, the parties shall equally share the arbitrators’ fees and expenses, and the arbitration and all related proceedings and discovery shall take place pursuant to a protective order entered by the arbitrators that adequately protects the confidential nature of each party’s Confidential Information. Unless otherwise agreed by the parties, the arbitration proceeding shall commence not later than thirty (30) days after a party provides notice of arbitration, shall not continue for longer than thirty (30) days and the arbitrators shall issue their decision within fifteen (15) Business Days after the conclusion of the proceeding. In no event shall any arbitration award provide a remedy beyond those permitted under this Agreement, and any award providing a remedy beyond those permitted under this Agreement shall not be confirmed, no presumption of validity shall attach, and such award shall be vacated.

f. Continued Performance . Each party shall have an unconditional and absolute obligation to continue to perform its obligations under this Agreement during the pendency of efforts to resolve any Dispute unless and until such obligations are terminated by this Agreement or prohibited by order of the arbitrators or a court of competent jurisdiction (as permitted by Section 9.5a) .

g. Confidentiality . All negotiations pursuant to this Section 9.5 are confidential and shall be treated as compromise and settlement negotiations for purposes of applicable rules of evidence.

9.6

Governing Law; Jurisdiction . This Agreement shall be governed by and interpreted in accordance with, and the legal relations between the parties hereto shall be determined in accordance with, the laws of the State of Illinois, United States of America, as if agreed to and performed entirely within the State of Illinois, United States of America, without regard to conflicts of law principles. WITH RESPECT TO ANY AND ALL JUDICIAL PROCEEDINGS RELATED TO THIS AGREEMENT, EACH PARTY HEREBY IRREVOCABLY CONSENTS TO THE EXCLUSIVE JURISDICTION OF, AND VENUE IN, ANY FEDERAL OR STATE COURT OF COMPETENT JURISDICTION LOCATED IN COOK COUNTY, ILLINOIS, UNITED STATES OF AMERICA, EXCLUDING ALL OTHER COURTS IN THE WORLD FOR THE PURPOSES OF ADJUDICATING ANY MATTER ARISING FROM OR IN CONNECTION WITH THIS AGREEMENT, EXCEPT WITH RESPECT TO THE ENFORCEMENT OF ANY JUDGMENT OR ARBITRAL AWARD AND WITH RESPECT TO INTERIM RELIEF, WHICH ENFORCEMENT AND/OR RELIEF MAY BE SOUGHT BEFORE ANY COURT OF COMPETENT JURISDICTION. WITH RESPECT TO ANY AND ALL DISPUTES OR BREACH OR ALLEGED BREACH OF THIS AGREEMENT, EACH PARTY HEREBY CONSENTS TO THE PROVISIONS OF SECTION 9.5 , AND SHALL INSTITUTE PROCEEDINGS ONLY AS PERMITTED BY SECTION 9.5 . The parties

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agree that the United Nations Convention on Contracts for the International Sale of Goods is specifically excluded from application to this Agreement.

9.7

Relationship of Parties . The relationship hereby established between Zebra and Manufacturer is solely that of customer and supplier. Manufacturer is an independent contractor, and nothing in this Agreement shall be construed to create a partnership, agency, joint venture, pooling, franchise, employer-employee or any other legal relationship or association between the parties. Neither party shall be responsible for the acts or omissions or the compensation, payroll-related taxes, workers’ compensation, accident or health insurance or other benefits of employees of the other party. Neither party has the power or authority to act for, represent, or bind the other (or its Affiliates) in any manner.

9.8

Notices . Any consent, agreement, approval, notice, or report or other communication required or permitted to be given or made under this Agreement by one of the parties hereto to other party shall be in writing and in English and shall be delivered in person or by a recognized overnight courier, by facsimile, by e-mail or by posting to Zebra’s FTP site or other similar electronic method. Such notice shall be deemed received on the date on which it is hand-delivered, on the third business day following the day on which it is deposited with an overnight delivery service (prepaid), on the day sent by facsimile with confirmation of receipt, if sent by e-mail, during normal business hours on a business day (in the country in which the recipient is located) and confirmed by one of the other aforesaid means of service, or if by posting to Zebra’s FTP site, on the day of posting. For purposes of notice, the addresses of the parties shall be as follows:

If to Zebra:

Zebra Technologies Corporation

333 Corporate Woods Parkway

Vernon Hills, Illinois 60061


Attention:		Chester Trocha
		Vice President, Global Supply Chain

Phone: 1-847-793-6700

Facsimile: 1-847-913-8766

E-mail: ctrocha@zebra.com

With a copy (which shall not constitute notice), to:

Zebra Technologies Corporation

333 Corporate Woods Parkway

Vernon Hills, Illinois 60061-3109


Attention:		Noel Elfant, Esq.
		Vice President and General Counsel

Phone: 1-847-793-6772

Fax: 1-847-821-1492

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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If to Manufacturer:

Jabil

10560 Dr. Martin Luther King, Jr., St .

North St. Petersburg, Florida 33716

Attention: Michael J. Loparco

Phone: 1-727-403-6646

Facsimile: 1-727-579-8529

E-mail: mike_loparco@jabil.com

With a copy (which shall not constitute notice), to:

Jabil

10560 Dr. Martin Luther King, Jr., St .

North St. Petersburg, Florida 33716

Attention: General Counsel, Legal Department

Phone: 1-727-577-9749

Facsimile: 1-727-579-8529

Any party may, by written notice to the other party in accordance with this Section 9.8 , change the address or addressee to which notices, requests or other communications shall be given. The parties may not use the FTP Site for purposes of providing notice under Sections 7.6 and 9.5 and Article VIII.

9.9

Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any action in any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein, and Zebra and Manufacturer agree that any arbitral or judicial authority permitted by Sections 9.5 or 9.6 shall be empowered to reform any invalid, illegal or unenforceable provision of this Agreement so as to be valid, legal and enforceable.

9.10

Compliance with Foreign Corrupt Practices Act . Neither Manufacturer nor any of its directors, officers, employees or owners will make any payment (including any offer to pay, promise to pay or gift of money or anything else of value) in connection with this Agreement or any Services provided pursuant to this Agreement to:

a. any government official, any political party or official of a political party, or any candidate for political office (in any country); or

b. any other person, while knowing, having reason to know or having credible information suggesting in any way that all or a portion of such money or thing of value

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will be offered, given or promised, directly or indirectly, to any government official, to any political party, or official thereof or to any candidate for political office (in any country), where the purpose of the payment was or is to influence or induce any government official, political party, official of a political party or candidate for political office:

(i)

to take any act or make any decision in that person’s official capacity;

(ii)

to fail to take an act in violation of that person’s official duty;

(iii)

affect or influence any act or decision by a government; or

(iv)

take or fail to take any other action that would violate the laws or regulations of the United States of America or any other country,

in order to assist Manufacturer, any of Manufacturer’s directors, officers, employees or owners, or Zebra in obtaining or retaining business for or with, or directing business to, any Person. The term “government official” means any officer or employee of a government or a department, agency, or instrumentality thereof, or any such person acting in an official capacity for or on behalf of such government or department, agency, or instrumentality, in any country. Manufacturer represents and warrants that none of its directors, officers, employees or owners is a government official, an official of a political party or a candidate for political office, in any country, except as has been disclosed in writing to Zebra. Manufacturer further agrees that it will notify Zebra before any of its directors, officers, employees or owners becomes in the future a government official, an official of a political party, or candidate for political office, so that Zebra can implement any precautions that it deems necessary to maintain compliance with the Foreign Corrupt Practices Act. In addition to the foregoing, neither Manufacturer nor any of its personnel shall make any payment (including any offer to pay, promise to pay or gift of money or anything else of value) to any Zebra employee in connection with the solicitation or award of this Agreement or any SOW.

9.11

Rights and Remedies Cumulative . Notwithstanding anything herein to the contrary, Zebra’s termination rights under this Agreement are cumulative with any warranty or other remedies set forth in this Agreement.

9.12

Further Assurances . The parties shall execute and deliver such further documents and take such further actions as may be necessary or appropriate to effectuate more fully this Agreement and to carry out the business contemplated by this Agreement.

9.13

Force Majeure .

a. General . Neither party shall be in breach of its obligations hereunder to the extent that performance is prevented or delayed due to circumstances of Force Majeure;

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provided that, Manufacturer shall not be excused from any of its obligations unless Manufacturer has complied with all procedures in connection with its business continuity plan pursuant to Section 3.3c , and then only for such period of time as is reasonable to resume the Services under the business continuity plan. In the event that either party is unable to perform its respective obligations, covenants and promises under this Agreement, in whole or in part, due to circumstances of Force Majeure, such party shall give the other party prompt notice of such circumstances and shall exercise every reasonable means to remove or alleviate such impediments to its performance as soon as possible. Subject to the provisions of Section 9.13b , performance under the terms of this Agreement shall be suspended only to the extent and only for such time as the Force Majeure persists and shall resume as soon as practicable after the Force Majeure has abated. In the event that a party’s obligations hereunder are suspended due to a Force Majeure event, then the other party’s obligations shall also be suspended for a corresponding period of time. Regardless of the excuse of Force Majeure, if a party is unable to perform within sixty (60) days after such event, then the other party may terminate this Agreement upon notice.

b. Supply Preference . In the event of a shortage of manufacturing capacity, or any Materials for a Product, as a result of a Force Majeure event, Manufacturer shall use commercially reasonable efforts to fulfill from such limited manufacturing capacity and/or supply of Materials or other facilities a proportional share of Zebra’s Weekly forecast for Products, such share to be based upon the volume of Zebra’s unfulfilled Weekly forecast for Products as compared to the outstanding orders of Manufacturer’s other customers (or its or its Affiliates’ internal needs) for products that also depend upon such manufacturing capacity or incorporate such Materials.

9.14

Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

9.15

Construction . This Agreement is executed in the English language and shall be deemed to comprise the language mutually chosen by the parties. This Agreement is governed by the English language and, if any translations are prepared of this Agreement and there is any conflict between the English version and such translation, the English version shall control. The parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement. As used in this Agreement, the singular shall include the plural and vice versa, and the terms “include” and “including” shall be deemed to be immediately followed by the phrase “without limitation.” The terms “herein” and “hereunder” and similar terms shall be interpreted to refer to this entire Agreement. The captions and headings in this Agreement are inserted for convenience and reference only and in no way define or limit the scope or content of this Agreement and shall not affect the interpretation of its provisions.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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9.16

Consent . Unless otherwise stated herein, all consents, approvals or agreements required to be obtained from a party shall not be unreasonably withheld or delayed.

9.17

Other Terms . The parties agree that time is of the essence for all deliveries of Product under this Agreement.

9.18

Entire Agreement . Any exhibits, schedules and other attachments to this Agreement, any subsequently accepted Release, any executed SOW or approved COR/COA, and all terms and conditions contained in any of the foregoing, are hereby incorporated by reference; provided that, in the event of a conflict between any term or condition of the main body of the Agreement and any term or condition of any exhibit, schedule, attachment, Release or SOW, the terms and conditions of the main body of the Agreement shall control except, in the case of Releases, SOWs or CORs/COAs as provided below in this Section 9.18 . This Agreement constitutes the entire agreement between the parties with respect to the Products and Services to be provided by Manufacturer to Zebra under this Agreement, and supercedes all other prior agreements, understandings and negotiations, both written and oral, among the parties with respect to such Products and Services. No representative of Zebra or Manufacturer is authorized to make any representation, warranty or promise not contained in this Agreement, except as provided by the next succeeding sentence. For purposes of clarity, the terms and conditions of this Agreement shall supersede and control any conflicting terms and conditions in any form of Release, SOW, COR/COA or any other business forms used by the parties for the purposes of ordering, acknowledging, invoicing or shipping, unless such business form is signed by authorized representatives of both parties and specifically references this Agreement and the provision(s) that is superseded.

9.19

No Amendment; Waiver . No change, amendment, termination, waiver or other modification of any of the provisions of this Agreement shall be binding on either party unless in writing and signed by an officer of each party who is authorized to take such action. No change, amendment, termination, waiver or other modification of this Agreement (including the expiration hereof) shall affect the rights of either party to enforce any claim which was incurred prior to the date of such modification. No waiver of any provision hereof or default, or exercise of any election provided under this Agreement, shall affect the right of either party thereafter to enforce said provision or to exercise any right or remedy or election in the event of any other default, whether or not similar.

Article X.

Definitions

The following terms, when used herein with initial capital letters, shall have the respective meanings set forth in this Article X .

“ Additional Insureds ” shall have the meaning provided in Section 0 .

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“ Affiliate ” means, with respect to a Person, any Person that directly or indirectly controls, is controlled by, or is under common control with such Person. For purposes of this definition, “control” shall mean direct or indirect beneficial ownership of more than fifty percent (50%) of the voting stock or other voting interests in the Person.

“ Agreement ” shall have the meaning provided in the Preamble.

“ Amortized Tooling ” shall have the meaning provided in Section 3.4b .

“ Approved Vendor List ” means, for a Product or other Service, the exclusive list of vendors for such Product or Service from which Manufacturer may purchase Materials, which list is communicated via Zebra’s Bill of Materials.

“ Approved Warehouse ” means a Zebra-approved warehouse.

“ BCP ” shall have the meaning provided in Section 3.3b .

“ Bill of Materials ” means the list of materials, including subassemblies, components, devices and packaging materials that comprise a Product or are used to provide other Services, and that is provided by Zebra in writing or approved by Zebra in advance in writing, including any changes thereto.

“ Box Build ” means a printer engine or a fully assembled printer.

“ Business Day ” means any day in which the Zebra location in Illinois, United States, is open for regular business.

“ COA ” means a change order approval as further described in Section 3.12(v) , the form of which is set forth in Exhibit H .

“ COR ” means a change order request as further described in Section 3.12 , the form of which is set forth in Exhibit G .

“ Change of Control ” means, with respect to a party, (a) the direct or indirect change in the ownership of fifty percent (50%) or more of the voting securities of such party, as applicable, in a single transaction or series of related transactions, or all or substantially all of the assets of such party, as applicable, are acquired by any entity, or such party, as applicable, is merged with or into another entity to form a new entity or (b) the direct or indirect change of the power to direct or cause the direction of the management policies of an such party, whether through the ownership of voting securities, by trust, management agreement, contest or otherwise, whether in a single transaction or series of related transactions.

“ Child Labor ” means a person younger than the greater of the following: (i) the age for completing compulsory education in the country in which such person is employed, (ii) the local legal minimum age for employment, or (iii) sixteen (16) years of age.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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“ Compliance Certification ” shall have the meaning provided in Section 3.8d .

“ Confidential Information ” shall have the meaning provided in Section 6.1

“ Contract Year ” means each one-year period commencing on the Effective Date and each anniversary thereof.

“ Critical Personnel “ shall have the meaning provided in Section 1.10 .

“ Defect ” means any failure to comply with the Warranty.

“ Designated Facility ” means any facility in which Services are being provided by Manufacturer to Zebra, such locations to be mutually agreed upon.

“ DFX Analysis ” means continuous improvement in concurrent Product and manufacturing process development to focus developers’ attention from the beginning on all key product lifecycle considerations such as customer requirements, quality, time to market, cost of ownership, and operational complexity.

“ Dispute ” means any dispute, controversy or claim arising out of, or relating to, this Agreement, including any of the foregoing with respect to the interpretation of any provision of this Agreement, the performance of either party of its obligations under this Agreement and situations or circumstances in which the parties are supposed to, but cannot, mutually agree, but excluding such situations and circumstances where a party is provided a right of termination hereunder in the event of such failure to agree.

“ Effective Date ” shall have the meaning provided in the Preamble.

“ Epidemic Failure ” means [*** Redacted]

“ Exporting Party ” shall have the meaning provided in Section 4.5g .

“ Excess Inventory ” means Materials, WIP and finished Products that Manufacturer has actually manufactured or procured in amounts that (a) for Materials, do not exceed the amount reasonably required to manufacture Products to fulfill the most recent Weekly Forecast, taking into account Long-lead Time Materials and minimum order requirements and subject to cancellations by Zebra as permitted by the flexibility table in Section 4.2c and (b) for WIP and finished Products, do not exceed the amount reasonably required to fulfill orders for Products set forth in Releases issued by Zebra. Excess Inventory shall not include any of the following: (i) amounts of Materials that exceed the amount reasonably required to manufacture Products to fulfill the most recent Weekly Forecast, taking into account Long-lead Time Materials and minimum order requirements, (ii) amounts of WIP and finished Product in excess of amounts reasonably required to fulfill orders for Products set forth in Releases issued by Zebra; (iii) damaged Materials, WIP or finished Products; (iv) any WIP or finished Products that can be reworked for other Products (upon Zebra’s prior approval) scheduled for Release within the next calendar quarter; (v) any WIP or finished Products not located at a Designated Facility or

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Approved Warehouse; or (vi) any Materials, WIP or finished Products that will be used to satisfy Manufacturer’s support obligations pursuant to Section 3.19 .

“ Force Majeure ” means acts of God (including fire, storm, flood, disease, pestilence, and earthquake), government action which frustrates the economic positions of the parties under the agreement or other acts beyond the reasonable control of a party, but expressly excluding strikes or other labor stoppages, slowdowns or disputes.

[*** Redacted]

“ Initial Transfer Date ” shall have the meaning provided in Section 3.6 .

“ Intellectual Property Rights ” means all intellectual property rights and other proprietary rights in any jurisdiction throughout the world (a) including (i) patents and patent applications and any divisions, continuations, continuations-in-part, reissues, extensions, or reexaminations thereof, (ii) rights in inventions, invention disclosures, trade secrets, know-how and other confidential or proprietary information, and (iii) copyrights and copyright applications and rights in copyrightable works and mask works, but (b) excluding Trademarks and applications therefor.

“ Laws ” means all statutory, civil or common laws, rules, regulations, codes and standards of the United States and those jurisdictions in which the Products will be manufactured.

“ Lien ” shall have the meaning provided in Section 7.4 .

“ Long-lead Time Materials ” means any Materials with lead times greater than ninety (90) days.

“ Loss ” means any and all loss, damage, liability, obligation, settlement payment, award, judgment, fine, penalty, deficiency, diminution in value, cost or expense, including all expenses incurred in connection with investigating, defending or asserting any claim, action, suit or proceeding incident to any matter indemnified against hereunder (including reasonable and documented fees and disbursements of legal counsel). Only for purposes of indemnification obligations of a party pursuant to Section 7.6 , Losses shall mean and be limited to (i) all finally awarded or adjudicated interest, fines or damages (including penalties) or settlement amounts, in each case including taxes, and (ii) reasonable and documented fees and disbursements of legal counsel. For the avoidance of doubt, a Loss for which an Indemnified Party is entitled to indemnification hereunder shall be direct damages of such Indemnified Party for the purposes of Section 7.6 and shall not be subject to Section 7.7a .

[*** Redacted] .

“ Manufacturer ” shall have the meaning provided in the Preamble.

“ Manufacturer Indemnified Parties ” shall have the meaning provided in Section 7.6b .

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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“ Manufacturer Process Adaptation and Documentation ” means all documentation, in whatever form, prepared by Manufacturer at the onset of and during the course of Services memorializing the procedures used to manufacture the Product. For the avoidance of doubt, Manufacturer Process Adaptation and Documentation does not include any Intellectual Property Rights or Technology.

“ Manufacturer Taxes ” means all taxes and duties on assets and properties that Manufacturer uses to manufacture Products or provide other Services to Zebra, including taxes and duties on Manufacturer’s real property, facilities, equipment and tooling and Materials, as well as all taxes and duties related to its employees.

“ Manufacturer Technology ” means all of the following: (a) Technology related to the manufacture of the Products that Manufacturer owned or possessed prior to the Effective Date; (b) Reusable Technology; (c) Technology developed by Manufacturer outside of this Agreement, except for such Technology that is incorporated into the Specifications for any Product; and (d) all Intellectual Property Rights embodied in any of the foregoing.

“ Materials ” means materials, including components, subassemblies, assemblies, devices and packaging materials that appear on the Bill of Materials for a Product or other Service.

“ Materials Costs ” means [*** Redacted] as set forth in Exhibit J [*** Redacted] .

“ Materials Declaration Requirements ” means Directive 2002/95/EC of the European Parliament and of the Council of 27 January 2003 on the restriction of the use of certain hazardous substances in electrical and electronic equipment as amended from time to time (“ RoHS Directive ”), Directive 2002/96/EC of the European Parliament and of the Council of 27 January 2003 on waste electrical and electronic equipment, as amended from time to time (“ WEEE Directive ”), any European Union Member State implementations thereof, and/or other similar environmental and/or materials declaration laws, directives, regulations and requirements, including international laws and treaties regarding such subject matter, as amended from time to time.

“ NRE Costs ” means the actual cost of testing and development, including ICT fixtures and software, FCT development, software and hardware (if needed in combination with ICT, or stand-alone), process equipment, stencils, dedicated solder carriers, and assembly tools and equipment for PCBA and final assembly, in each case that are unique to the Products and that cannot be leveraged by Manufacturer for its general benefit or for the benefit of other customers of Manufacturer.

“ Non-Assignable Zebra Technology ” means any of the Zebra Technology that cannot (as a matter of Law) be assigned by Manufacturer (or its Subcontractor) to Zebra as provided for above.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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“ Non-conforming Product ” means any shipment of Product that is damaged, short against order, contains the wrong type of Product, does not function as represented, or suffers any Defect.

“ Obsolete Inventory ” means Unique Materials, WIP and finished Products that (a) Manufacturer has actually manufactured or procured in amounts that (i) for Unique Materials, do not exceed the amount reasonably required to manufacture Products to fulfill the most recent Weekly Forecast, taking into account Long-lead Time Materials and minimum order requirements and subject to cancellations by Zebra as permitted by the flexibility table in Section 4.2c and (ii) for WIP and finished Products, do not exceed the amount reasonably required to fulfill orders for Products set forth in Releases issued by Zebra and (b) are not useful for Products for purchase by Zebra because such Materials, WIP or finished Products have been rendered obsolete by (i) the implementation of a COR or a COA, or (ii) termination of this Agreement by Zebra pursuant to Sections 8.2 or 8.3 , or pursuant to Section 8.5 as a result of Manufacturer’s bankruptcy or insolvency. Obsolete Inventory shall not include any of the following: (A) amounts of Materials that exceed the amount reasonably required to manufacture Products to fulfill the most recent Weekly Forecast, taking into account Long-lead Time Materials and minimum order requirements, (B) amounts of WIP or finished Product in excess of amounts reasonably required to fulfill orders for Products set forth in Releases issued by Zebra; (B) damaged Materials, WIP or finished Products; (C) any WIP or finished Products that can be reworked for other Products (upon Zebra’s prior approval); (D) any WIP or finished Products not located at a Designated Facility or Approved Warehouse; or (E) any Materials, WIP or finished Products that will be used to satisfy Manufacturer’s support obligations pursuant to Section 3.19 .

“ PCBA ” means printed circuit board assemblies.

“ Person ” means any natural person, corporation, company, partnership, limited partnership, limited liability company, firm, association, trust, government, governmental agency, or any other entity, whether acting in an individual, fiduciary or other capacity.

“ Pilot Line ” shall have the meaning provided in Section 3.2 .

[*** Redacted]

“ Product ” means the product(s) (including full assemblies and subassemblies) manufactured and assembled by Manufacturer on behalf of Zebra under this Agreement as identified in Exhibit A (or any subsequent Exhibit A prepared for any of the foregoing) including any updates, renewals, modifications or amendments thereto.

“ Production Line ” shall have the meaning provided in Section 3.2 .

[*** Redacted]

“ Prohibited Labor ” means Child Labor or prison, slave, bonded, indentured, or involuntary labor.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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“ Project Team ” shall have the mean provided in Section 1.9b .

“ Quality Data ” means information and data relating to the quality and status of Services and Products provided under this Agreement, including in-process yields, a Pareto chart of quality failures, final quality audit data, factory PPM data, supplier quality performance, on-time deliveries, return rates, failure rates, no fault found rates, and corrections.

“ Quarterly Business Review ” shall have the meaning provided in Section 1.9b(ii) .

“ Quarterly Forecast ” shall have the meaning provided in Section 4.1 .

“ RCN ” means a release change notice issued to reflect changes in quantities or delivery dates in issued Releases.

“ Relationship Manager ” shall have the meaning provided in Section 1.9a .

“ Release ” shall have the meaning provided in Section 4.2b .

“ Retentions ” shall have the meaning provided in Section 7.9c .

“ Reusable Technology ” means Technology that is developed by or on behalf of Manufacturer under this Agreement, that (i) does not contain, embody or reference any Zebra Technology or any Confidential Information of Zebra, (ii) is not unique to any of the Products, and (iii) can be used by Manufacturer in its business generally to manufacture other products for third parties.

“ Reporting Quarter ” shall have the meaning provided in Section 0 .

“ RMA ” means a Return Materials Authorization from Manufacturer to Zebra authorizing the return of Products or other materials to Manufacturer.

“ Scrap ” means Materials or WIP that are deemed no longer useful for manufacturing Products, and finished Products that do not meet Specifications. For purposes of determining whether a finished Product constitutes Scrap, Manufacturer shall, in accordance with the Specifications, quality test such finished Product at most three (3) times. If such finished Product fails all three (3) quality tests, then such item shall constitute Scrap. If a finished Product passes the quality test on any of the three (3) tries, then such item shall not constitute Scrap. Manufacturer may repair and/or rework such finished Product between tests. Manufacturer shall complete all three tests within one (1) month of the date of the first test.

“ Services ” means all work to be performed by or on behalf of Manufacturer for Zebra under this Agreement, including any manufacturing, design, development, engineering, consulting, or training services for which Zebra engages Manufacturer on an independent consultant basis and the manufacturing, testing, configuring, assembling, packaging, shipping and product management of the Products for which Zebra engages Manufacturer on a contract manufacturing basis.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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“ SG&A Costs ” means[*** Redacted] general and administrative operating expenses [*** Redacted] .

“ SOW ” means a statement of work for design, development, engineering, consulting, testing or training Services to be performed by Manufacturer for Zebra, as described in Section 2.2 .

“ Specifications ” means, for each Product, (a) the physical characteristics of sample products provided by Zebra and/or product and/or industry specifications provided to Manufacturer via Zebra’s FTP site, (b) testing specifications (c) marking, packaging and shipping specifications, (d) adherence to the Approved Vendor List, (e) adherence to the Bill of Materials, (f) conformance with the requirements of the Underwriters Laboratory, or similar entity, for the same or similar products, and (g) conformance with ISO 9001 standards. Specifications may be amended from time to time by amendments in the form of an SOW or COR/COA agreed to by the parties.

“ Statement of Work ” shall have the meaning provided in Section 2.1 .

“ Stored Inventory ” shall have the meaning provided in Section 4.7c .

“ Technical Manager ” shall have the meaning provided in Section 1.9a .

“ Technology ” means all inventions, ideas, know-how, specifications, proprietary information, product and component designs, drawings, blueprints, schematics, manufacturing methods and processes, process documentation, calibration techniques, molds and mold designs, tooling and tooling designs, placement files, materials and test specifications, bill of materials list, vendor information, test documentation and data and software (including source code, executable code, middleware, firmware, data, databases and documentation) embedded in a Product or used for programming and calibrating the Product.

“ Term ” means the Initial Term (as defined in Section 8.1 ) and all Renewal Terms (as defined in Section 8.1 ).

“ Trademarks ” means trademarks, service marks, trade names, brand names, corporate names, trade dress, logos, labels, package designs and other source identifiers.

“ Transition Service Fees ” means all reasonable fees mutually agreed to between the parties as defined in an SOW for the transition of a Product to an alternate manufacturing source.

“ Transfer Plan ” shall have the meaning provided in Section 1.9b(i) .

“ Unique Materials ” means those non-standard Materials procured exclusively for incorporation into the Products and that are not reasonably usable for other products or other customers.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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“ Unique Tooling ” means, with respect to any Product or Service that Manufacturer provides to Zebra under this Agreement, any tooling, molds, fixtures or equipment unique to any such Product or Service.

“ Value-Added Costs ” means [*** Redacted] as set forth in Exhibit J [*** Redacted] .

“ Warehouse Inventory ” shall have the meaning provided in Section 4.7 .

“ Warehouse Products Storage ” shall have the meaning provided in Section 4.7c .

“ Warranty ” means, collectively, the product-specific warranties, as more fully defined in Section 7.2 .

“ Warranty Period ” means, for any Product, [*** Redacted] from the date of delivery of such Product.

“ Weekly Forecast ” shall have the meaning provided in Section 4.1 .

“ WIP ” means a work-in-process, which consists of a partially completed Product.

“ Work Product ” means all Technology, deliverables and other materials and information that are discovered, made, created, designed, developed or reduced to practice by or on behalf of Manufacturer in connection with this Agreement (including under any SOW or COR/COA) and that are related to the current or currently proposed business of Zebra or any of its Affiliates. For purposes of clarity, any calibration technique or process developed under this Agreement and used to test or calibrate a Product shall be considered a Work Product owned by Zebra.

“ Zebra ” shall have the meaning provided in the Preamble.

“ Zebra Technology ” means all of the following in any jurisdiction throughout the world: (a) all Technology that is related to the Products that Zebra owned or possessed prior to the Effective Date, and any additions, advances, changes, derivatives, improvements, enhancements, refinements or modifications made thereafter to any such Technology by or on behalf of either of the parties; (b) all other Technology developed by either party in connection with this Agreement, other than Reusable Technology; (c) all Technology developed by Zebra outside of this Agreement; (d) any Technology developed by Manufacturer outside this Agreement that is incorporated into the Specifications for any Product; and (e) all Intellectual Property Rights embodied in any of the foregoing.

“ Zebra Indemnified Parties ” shall have the meaning provided in Section 7.6a .

[ Signature Page Follows]

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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IN WITNESS WHEREOF, each of the parties, acting through its duly authorized representative, signs this Agreement on the date indicated.


Zebra Technologies Corporation		Jabil Circuit, Inc.

By:	/s/ Hugh Gagnier	By:	/s/ Michael J. Loparco
Print Name:	Hugh Gagnier	Print Name:	Michael J. Loparco
Title:	Senior Vice President	Title:	VP, Global Business Units
Date:	May 30, 2007	Date:	May, 29, 2007

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT A

[*** Redacted]

See attached.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT B

[*** Redacted]

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT C

Form of Transfer Plan


ID	Name	Duration	Start	Finish	Predecessors
3	Existing Zebra Supplier(s) PCA Buffer Stock Build	125.15d	10/19/2005 8:00	4/11/2006 9:12
4	Freeze ecn/mco that are affecting material beyond 03/31/06	124.15d	10/20/2005 8:00	4/11/2006 9:12
5	No ECO for ROHS parts after October ‘05	8.d	10/20/2005 8:00	10/31/2005 17:00
6	Analysis for Buffer and ROHs convertion	5.d	11/1/2005 8:00	11/7/2005 17:00	5
7	Compilation of Obsolete material with ECN	117.d	10/20/2005 8:00	4/11/2006 9:12	6
8	Material & Planning	125.d	10/19/2005 8:00	4/10/2006 17:00
9	Cap model exercise SMT,FRONT END	1.d	10/19/2005 8:00	10/19/2005 17:00
10	Cap model exercise backend	1.d	10/19/2005 8:00	10/19/2005 17:00	9
11	PCA MPS LOAD jan into DEC. Feb into JAN .1/2 march into P2	3.d	10/20/2005 8:00	10/24/2005 17:00	9,10
12	CTS report for Buffer build plan	92.d	10/25/2005 8:00	2/28/2006 17:00	11
13	All MPS Loaded	.d	10/24/2005 8:00	10/24/2005 8:00
14	MRP Requirement to Vendor	1.d	10/25/2005 8:00	10/25/2005 17:00	11
15	Compile Critical Material list	5.d	10/26/2005 8:00	11/1/2005 17:00	14,11
16	Review the critical material list with SBM weekly basis	95.d	11/2/2005 8:00	3/13/2006 17:00	15
17	3 mths. demand window shortage report BI-weekly	95.d	11/2/2005 8:00	3/13/2006 17:00	11
18	Define Packaging requirements ( MOQ )	11.d	12/12/2005 8:00	12/26/2005 17:00
19	Drive demand for packaging	76.d	12/27/2005 8:00	4/10/2006 17:00	18
20	PO cut Over open POs for production material	111.d	11/8/2005 8:00	4/10/2006 17:00	11FS+10 days
21	Change schedule agreements with vendors	111.d	11/8/2005 8:00	4/10/2006 17:00	11FS+10 days
22	Communicate ship to site for open PO to suppliers (supplier letter)	111.d	11/8/2005 8:00	4/10/2006 17:00	20FS-111 days,11
23	Transfer Excess material to Selected Jabil Manufacturing Location(s)	99.d	11/8/2005 8:00	3/23/2006 17:00
24	Disposition RTV before Existing Zebra Supplier(s) shutdown	99.d	11/9/2005 9:12	3/27/2006 9:12	7FS-110 days,11
25	Disposition RTC and Obsolete material before Existing Zebra Supplier(s) shutdown	99.d	11/9/2005 9:12	3/27/2006 9:12	7FS-110 days,11
26	Space to store raw material for buffer build	20.d	10/24/2005 8:00	11/18/2005 17:00	11
27	Space to store PCA WIP	20.d	10/24/2005 8:00	11/18/2005 17:00	11
28	Additional Storage and Capacity	34.d	11/8/2005 8:00	12/23/2005 17:00
29	Additional Storage Racks	18.d	11/21/2005 8:00	12/14/2005 17:00	11,26FS-60 days,27FS-60 days

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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30	Additional Storage Boxes	34.d	11/8/2005 8:00	12/23/2005 17:00	11,26FS-60 days,27FS-60 days
31	Additional PCA holding Trays	34.d	11/8/2005 8:00	12/23/2005 17:00	11,26FS-60 days,27FS-60 days
32	Additional PCA holding Carts	34.d	11/8/2005 8:00	12/23/2005 17:00	11,26FS-60 days,27FS-60 days
33	Machine Support for 2nd shift	34.d	11/8/2005 8:00	12/23/2005 17:00	11,26FS-60 days,27FS-60 days
34	Additional Wave Pallets and Tooling	34.d	11/8/2005 8:00	12/23/2005 17:00	11,26FS-60 days,27FS-60 days
35	Ship PCAs for Selected Jabil Manufacturing Location(s) DF Qualification	46.d	11/7/2005 8:00	1/9/2006 17:00
36	List of PCA to ship to Selected Jabil Manufacturing Location(s) for Qual process	14.d	11/7/2005 8:00	11/24/2005 17:00	490
37	Quantity of PCA for DF qual to ship to Selected Jabil Manufacturing Location(s)	20.d	11/10/2005 8:00	12/7/2005 17:00	490
38	Purchase Boxes to ship PCA to Selected Jabil Manufacturing Location(s) for Qual	13.d	12/8/2005 8:00	12/26/2005 17:00	37
39	Ship PCAs to Selected Jabil Manufacturing Location(s) per DF Qual Plan list	10.d	12/13/2005 8:00	12/26/2005 17:00	38FS-10 days,490
40	PCAs for DF Qual to arrive in Selected Jabil Manufacturing Location(s)	10.d	12/27/2005 8:00	1/9/2006 17:00	39
41	Existing Zebra Supplier(s) SMT Shutdown	.d	3/15/2006 8:00	3/15/2006 8:00
42	Transfer SMT / DF Operation to Selected Jabil Manufacturing Location(s)	129.d	10/17/2005 8:00	4/12/2006 17:00
43	MPS	121.d	10/17/2005 8:00	3/31/2006 17:00
44	Transfer MPS List	108.d	10/17/2005 8:00	3/14/2006 17:00	359,360,361,362
45	Production schedule by platform	43.d	1/16/2006 8:00	3/15/2006 17:00	11
46	Transfer of WIP to Pg	27.d	2/23/2006 8:00	3/31/2006 17:00	36,37,38
47	MPS Transfer document	87.d	11/15/2005 8:00	3/14/2006 17:00	44SS
48	ZERO backlog for orders	33.d	2/15/2006 8:00	3/31/2006 17:00
49	Last call for Existing Zebra Supplier(s) orders	30.d	2/1/2006 8:00	3/14/2006 17:00
50	Flexibility management process documented	46.d	11/10/2005 8:00	1/12/2006 17:00
51	PO Transfer for purchase of parts by Selected Jabil Manufacturing Location(s)	5.d	12/21/2005 8:00	12/27/2005 17:00	56,370
52	Transfer any Excess raw material to Selected Jabil Manufacturing Location(s)	10.d	3/16/2006 8:00	3/29/2006 17:00	49
53	Disposition of Obsolete material	117.d	10/20/2005 8:00	3/30/2006 17:00	7SS
54	Disposition of MRB material	117.d	10/20/2005 8:00	3/30/2006 17:00	7SS
55	Resolve all outstanding invoices	35.d	2/10/2006 8:00	3/30/2006 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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56	Send vendor contact info. To Jabil MS	1.d	11/8/2005 8:00	11/8/2005 17:00
57	SME Support for SAP BOM mass upload from Existing Zebra Supplier(s) facility	14.d	12/9/2005 8:00	12/28/2005 17:00	277
58	Verify and Update open EC into Pg SAP BOM	7.d	12/9/2005 8:00	12/19/2005 17:00	277
59	MPS Loading in Jabil Site (s)	5.d	12/29/2005 8:00	1/4/2006 17:00	57
60	Setup Product Matrix & run rate cap model	10.d	1/5/2006 8:00	1/17/2006 17:00	59
61	Forward Customer Forecast History ( waterfall chart)	12.d	11/8/2005 8:00	11/23/2005 17:00
62	Pull in MPS from Existing Zebra Supplier(s) for safety stock	1.d	10/18/2005 8:00	10/18/2005 17:00
63	Swap MPS ensuring Zero Duplication	25.d	10/17/2005 8:00	11/18/2005 17:00	44SS
64	Determine the product order to run	5.d	11/21/2005 8:00	11/25/2005 17:00	59
65	Prepare a production schedule for buffer build in Existing Zebra Supplier(s)	5.d	11/28/2005 8:00	12/2/2005 17:00	64
66	Run CTS for production schedule for buffer build	10.d	12/5/2005 8:00	12/16/2005 17:00	65
67	Manufacturing Process Material and Documentation	106.d	11/7/2005 8:00	3/31/2006 17:00
68	Visual Aids to be placed in FTP or Shared folder site	66.d	11/8/2005 8:00	2/6/2006 17:00
69	Need resource for translation and convert to Adobe	60.d	11/8/2005 8:00	2/6/2006 17:00
70	Process Flow	40.d	11/8/2005 8:00	1/2/2006 17:00
71	Transfer SMT programs	3.d	11/7/2005 8:00	11/9/2005 17:00	490
72	Transfer tooling like Stencil,Wave Pallet,Inspection Templates	13.d	3/15/2006 8:00	3/31/2006 17:00	41
73	Special nozzles for SMT	1.d	3/15/2006 8:00	3/15/2006 17:00	41
74	SMT and Wave Solder profile	15.d	11/7/2005 8:00	11/25/2005 17:00	490
75	Process flow charts	3.d	11/7/2005 8:00	11/9/2005 17:00	490
76	Tooling for Manual ASSY.	13.d	3/15/2006 8:00	3/31/2006 17:00	41
77	List of chemicals used	1.d	11/7/2005 8:00	11/7/2005 17:00	490
78	FMEA documents	1.d	11/7/2005 8:00	11/7/2005 17:00	490
79	Diag WIP	65.d	1/2/2006 8:00	3/30/2006 17:00
80	Mark and package boards still in process after testing is completed	12.d	3/15/2006 8:00	3/30/2006 17:00	41
81	Disposition Engineering hold boards	55.d	1/2/2006 8:00	3/16/2006 17:00
83	Transfer dedicated PCA Test Equipment	126.d	10/19/2005 8:00	4/11/2006 17:00	41
84	Provide inventory of all Zebra test equip.	1.d	11/8/2005 8:00	3/15/2006 10:00	91,41
85	Build crates for ICT and Functional tester	15.d	3/15/2006 8:00	4/4/2006 17:00	41
86	Ship ICT and Functional fixtures	15.d	3/16/2006 8:00	4/5/2006 17:00	85SS+1 day,41
87	Ship reference boards/systems /memory	11.d	3/15/2006 8:00	3/29/2006 17:00
88	Transfer 5dx,ICT,FT and ESS test scripts	16.d	3/15/2006 8:00	4/5/2006 17:00	158
89	Ship flash cards duplicators	11.d	3/15/2006 8:00	3/29/2006 17:00	41
90	Transfer Debug/Diag tools and equip.	11.d	3/15/2006 8:00	3/29/2006 17:00	41
91	Inventory of all DF Zebra test equipment	6.d	10/19/2005 8:00	10/26/2005 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-67-


92	Ship flash/disk duplicators	20.d	3/15/2006 8:00	4/11/2006 17:00	41
93	Transfer 2 ESS chambers	20.d	3/15/2006 8:00	4/11/2006 17:00	41
94	Ship system Test fixture	20.d	3/15/2006 8:00	4/11/2006 17:00	41
95	Ship Zebra test station / server	20.d	3/15/2006 8:00	4/11/2006 17:00	41
96	Acquire label printers for IB30 / IB40	20.d	3/15/2006 8:00	4/11/2006 17:00	179
98	Transfer dedicated DF Test Equipment	113.d	11/8/2005 8:00	4/12/2006 17:00
99	Transfer ESS chamber	20.d	3/15/2006 8:00	4/11/2006 17:00	41
100	Transfer sys. Test scripts	20.d	11/8/2005 8:00	12/5/2005 17:00
101	Ship Box test ESS Racks	20.d	3/15/2006 8:00	4/11/2006 17:00	41
102	Ship ESS Patch panels and Cables	20.d	3/15/2006 8:00	4/11/2006 17:00	41
103	Transfer Box ESS TEST scripts	20.d	3/15/2006 8:00	4/11/2006 17:00	41
104	Ship / acquire HI-POT test equipment	20.d	3/15/2006 8:00	4/11/2006 17:00	41
105	Transfer Debug/Diag tools and equip.	20.d	3/15/2006 8:00	4/11/2006 17:00	41
106	Transfer dedicated Chassis Assembly Equipment	20.d	3/16/2006 8:00	4/12/2006 17:00	41
108	Finance/ Business Unit	48.d	11/8/2005 8:00	1/12/2006 17:00
109	Pricing training for Jabil buyer	10.d	12/15/2005 8:00	12/28/2005 17:00
110	PPV Training for Jabil buyer	10.d	12/19/2005 8:00	12/30/2005 17:00
111	Revaluation of inventory	9.d	1/2/2006 8:00	1/12/2006 17:00
112	E&O	45.d	11/8/2005 8:00	1/9/2006 17:00
113	Forecasting Training	45.d	11/8/2005 8:00	1/9/2006 17:00
115	Quality	17.d	11/8/2005 8:00	11/30/2005 17:00
116	Transfer Lessons Learned	6.d	11/8/2005 8:00	11/15/2005 17:00
117	Transfer information on targets setting	1.d	11/8/2005 8:00	11/8/2005 17:00
118	Transfer Zebra format Reports	17.d	11/8/2005 8:00	11/30/2005 17:00
119	Transfer Get Well Plan methodology	6.d	11/8/2005 8:00	11/15/2005 17:00
120	Traffic	57.4d	10/20/2005 8:00	1/9/2006 11:12
121	Shipping and Customs Instructions	1.d	10/20/2005 8:00	10/20/2005 17:00
122	Carrier type and Lead time	1.d	10/20/2005 8:00	10/20/2005 17:00
123	Zebra tooling inventory list that will be shipped to Selected Jabil Manufacturing Location(s)	45.d	11/2/2005 8:00	1/9/2006 11:12	84SS,91
125	Workcell Activity Training	35.d	11/8/2005 8:00	12/26/2005 17:00
126	JOS Training Package	35.d	11/8/2005 8:00	12/26/2005 17:00
127	Train Pg Workcell Manager	35.d	11/8/2005 8:00	12/26/2005 17:00
128	Scorecard for Operation	35.d	11/8/2005 8:00	12/26/2005 17:00
129	Zebra Scorecard	35.d	11/8/2005 8:00	12/26/2005 17:00
130	Training by Function	35.d	11/8/2005 8:00	12/26/2005 17:00
131	Zebra Meetings	35.d	11/8/2005 8:00	12/26/2005 17:00
132	Training on Unique activities	35.d	11/8/2005 8:00	12/26/2005 17:00
134	Selected Jabil Manufacturing Location(s) Qualification Complete	145.d	10/6/2005 8:00	4/25/2006 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-68-


135	Overall IT	94.d	10/6/2005 8:00	2/13/2006 17:00
136	Selected Jabil Manufacturing Location(s) IT Systems	94.d	10/6/2005 8:00	2/13/2006 17:00
137	Networking	81.d	10/19/2005 8:00	2/7/2006 17:00
138	Identification & Discovery Phase	78.d	10/19/2005 8:00	2/2/2006 17:00
139	Communication/Meeting with Existing Zebra Supplier(s) IT	76.d	10/19/2005 8:00	1/31/2006 17:00
140	Identification Network Structure & Option propose(1 & 2)	25.d	10/24/2005 8:00	11/25/2005 17:00
141	Options Approval	5.d	11/18/2005 8:00	11/24/2005 17:00
142	Communication to Regional IT	65.d	11/7/2005 8:00	2/2/2006 17:00
143	Design Phase	10.d	11/15/2005 8:00	11/28/2005 17:00
144	PR for Circuits	10.d	11/15/2005 8:00	11/28/2005 17:00
145	Network Infrastructure	35.d	11/14/2005 8:00	12/30/2005 17:00
146	Verify Zebra Network Schema in Selected Jabil Manufacturing Location(s)	35.d	11/14/2005 8:00	12/30/2005 17:00
147	Verify and finalized deployment plan - review any risk or issues	30.d	11/14/2005 8:00	12/23/2005 17:00
148	Deployment Phase	36.d	12/14/2005 8:00	1/31/2006 17:00
149	UTP raiser cabling & patching	36.d	12/14/2005 8:00	1/31/2006 17:00
150	Network Equipment Installation	5.d	12/26/2005 8:00	12/30/2005 17:00
151	Network Equipment Configuration	8.d	12/26/2005 8:00	1/4/2006 17:00
152	Production Line cabling infrastructure	18.d	12/14/2005 8:00	1/6/2006 17:00
153	Finalize and review any risk or issues	18.d	12/14/2005 8:00	1/6/2006 17:00
154	Testing Phase	14.d	1/2/2006 8:00	1/18/2006 17:00
155	Network services (Trace-route and Ping Test)	5.d	1/2/2006 8:00	1/6/2006 17:00
156	Remote network access (telnet Servers)	8.d	1/4/2006 8:00	1/13/2006 17:00
157	Access to tester (all network services that Zebra required)	4.d	1/4/2006 8:00	1/9/2006 17:00
158	Review and buyoff over all infrastructure	12.d	1/4/2006 8:00	1/18/2006 17:00
159	Implementation Plan	1.d	1/15/2006 8:00	1/15/2006 17:00
160	Go-Live	1.d	1/15/2006 8:00	1/15/2006 17:00
161	Support Phase	5.d	1/15/2006 8:00	1/19/2006 17:00
162	Review Phase	5.d	1/15/2006 8:00	1/19/2006 17:00
163	Lessons Learned	5.d	2/1/2006 8:00	2/7/2006 17:00
164	MES (Manufacturing Execution System)	94.d	10/6/2005 8:00	2/13/2006 17:00
165	Identification Process	72.d	10/6/2005 8:00	1/13/2006 17:00
166	Communication/Meeting with Existing Zebra Supplier(s) IT team	72.d	10/6/2005 8:00	1/13/2006 17:00
167	Site Discovery	28.d	10/19/2005 8:00	11/25/2005 17:00
168	Hardware requirement	15.d	10/24/2005 8:00	11/11/2005 17:00
169	Shop Floor System (MES)	28.d	10/19/2005 8:00	11/25/2005 17:00
170	EPS	25.d	10/19/2005 8:00	11/22/2005 17:00
171	VB TARS	3.d	10/25/2005 8:00	10/27/2005 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-69-


172	VB CIQ	3.d	10/28/2005 8:00	11/1/2005 17:00
173	AMW	24.d	10/19/2005 8:00	11/21/2005 17:00
174	Test Result File(Parser)	10.d	11/14/2005 8:00	11/25/2005 17:00
175	Custom Code	25.d	10/19/2005 8:00	11/22/2005 17:00
176	Vantive Script - data feed to Zebra System	10.d	11/8/2005 8:00	11/21/2005 17:00
177	Identify Barcode labels (inline & offline)	20.d	10/24/2005 8:00	11/18/2005 17:00
178	Design Phase	37.d	10/24/2005 8:00	12/13/2005 17:00
179	PR - Hardware, Software license	15.d	11/1/2005 8:00	11/21/2005 17:00
180	Barcode Label (inline & off line)	20.d	11/16/2005 8:00	12/13/2005 17:00
181	Transfer Zebra Database as reference	4.d	10/24/2005 8:00	10/27/2005 17:00
182	Define MES Gaps	25.d	10/24/2005 8:00	11/25/2005 17:00
183	Development Phase	29.d	11/8/2005 8:00	12/16/2005 17:00
184	EPS Customisation & conversion	8.d	11/8/2005 8:00	11/17/2005 17:00
185	Custome Code	15.d	11/28/2005 8:00	12/16/2005 17:00
186	Vantive & Serial # Scripts	15.d	11/28/2005 8:00	12/16/2005 17:00
187	Test Phase	44.d	11/8/2005 8:00	1/6/2006 17:00
188	Hardware Testing	10.d	12/26/2005 8:00	1/6/2006 17:00
189	Setup Testing database - Zebra	2.d	11/8/2005 8:00	11/9/2005 17:00
190	Label testing - Label Matrix	15.d	11/21/2005 8:00	12/9/2005 17:00
191	Custom Code /Local apps customisation testing	10.d	11/21/2005 8:00	12/2/2005 17:00
192	EPS	22.d	11/17/2005 8:00	12/16/2005 17:00
193	Test EPS Functionality	10.d	11/17/2005 8:00	11/30/2005 17:00
194	BOM Manager	15.d	11/28/2005 8:00	12/16/2005 17:00
195	Part Manager	15.d	11/28/2005 8:00	12/16/2005 17:00
196	Kitting	15.d	11/28/2005 8:00	12/16/2005 17:00
197	Bundle Header	15.d	11/28/2005 8:00	12/16/2005 17:00
198	in line Label Printing (Linking stations)	15.d	11/28/2005 8:00	12/16/2005 17:00
199	Vantive Interface to Zebra	10.d	12/12/2005 8:00	12/23/2005 17:00
200	TARS	15.d	11/28/2005 8:00	12/16/2005 17:00
201	CIQ	15.d	11/28/2005 8:00	12/16/2005 17:00
202	EPS - SAP integration testing	25.d	11/16/2005 8:00	12/20/2005 17:00
203	EPS & SAP Delivery Noted info to TARS	25.d	11/16/2005 8:00	12/20/2005 17:00
204	Training Phase	25.d	12/12/2005 8:00	1/13/2006 17:00
205	HR Trainers	5.d	12/19/2005 8:00	12/23/2005 17:00
206	Operators	15.d	12/26/2005 8:00	1/13/2006 17:00
207	Superusers	5.d	12/12/2005 8:00	12/16/2005 17:00
208	Implementation Phase	30.d	12/5/2005 8:00	1/13/2006 17:00
209	Readiness meeting with Site Sups & IT	5.d	12/26/2005 8:00	12/30/2005 17:00
210	Setup	30.d	12/5/2005 8:00	1/13/2006 17:00
211	Database - Production	5.d	12/5/2005 8:00	12/9/2005 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-70-


212	Zebra DB - (TARS DB)	5.d	12/5/2005 8:00	12/9/2005 17:00
213	Store Procedure	3.d	12/5/2005 8:00	12/7/2005 17:00
214	Vantive Scripts	3.d	12/5/2005 8:00	12/7/2005 17:00
215	Hardware	15.d	12/26/2005 8:00	1/13/2006 17:00
216	Terminal Server	5.d	12/26/2005 8:00	12/30/2005 17:00
217	Complus Server	2.d	12/26/2005 8:00	12/27/2005 17:00
218	IIS Server	1.d	12/26/2005 8:00	12/26/2005 17:00
219	Parser	1.d	12/26/2005 8:00	12/26/2005 17:00
220	PCs apps ready (RDP)	10.d	1/2/2006 8:00	1/13/2006 17:00
221	Software	11.d	12/26/2005 8:00	1/9/2006 17:00
222	Application(MES) Setup - Terminal Server	3.d	12/26/2005 8:00	12/28/2005 17:00
223	EPS setup	5.d	1/3/2006 8:00	1/9/2006 17:00
224	Lable Matrix (Link stations)	5.d	1/3/2006 8:00	1/9/2006 17:00
225	Superuser configuration (Labels, MES & AMW)	20.d	12/19/2005 8:00	1/13/2006 17:00
226	Operators Ids (assign domain group)	10.d	12/26/2005 8:00	1/6/2006 17:00
227	Trial Run	48.d	11/8/2005 8:00	1/12/2006 17:00
228	Identify Boards going to Trial	2.d	1/2/2006 8:00	1/3/2006 17:00
229	Verification application is functioning correctly	3.d	1/10/2006 8:00	1/12/2006 17:00
230	Verify application reporting	3.d	1/10/2006 8:00	1/12/2006 17:00
231	Line(customer) Go Live	1.d	11/8/2005 8:00	11/8/2005 17:00
232	Support Phase	15.d	11/8/2005 8:00	11/28/2005 17:00
233	Review Phase	9.d	2/1/2006 8:00	2/13/2006 17:00
234	Lessons Learned	5.d	2/1/2006 8:00	2/7/2006 17:00
235	Closed out Implementation	1.d	2/13/2006 8:00	2/13/2006 17:00
236	Jabil Regional and Selected Jabil Manufacturing Location (s) SME	63.d	10/19/2005 8:00	1/13/2006 17:00
237	DEV30 ( 4.6)	10.d	10/19/2005 8:00	11/1/2005 17:00
238	Gap Analysis	10.d	10/19/2005 8:00	11/1/2005 17:00
239	SD Configuration	10.d	10/19/2005 8:00	11/1/2005 17:00
240	Testing ( manual)	10.d	10/19/2005 8:00	11/1/2005 17:00
241	DEV5.0 ( 010)	60.d	10/24/2005 8:00	1/13/2006 17:00	237
242	SD Configuration	1.d	11/2/2005 8:00	11/2/2005 17:00
243	Assign pricing procedure JZebra to sales area 0301/01/xx & 0301/02/xx	1.d	11/2/2005 8:00	11/2/2005 17:00
244	Maintain Transportation Planning Point ( MY01, Company 0301 )	1.d	11/2/2005 8:00	11/2/2005 17:00
245	Maintain transportation planning point for external systems ( MY01)	1.d	11/2/2005 8:00	11/2/2005 17:00
246	Maintain Statistics for each Transportation Planning Point ( MY01)	1.d	11/2/2005 8:00	11/2/2005 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-71-


247	DEV5.0 (020)	10.d	11/2/2005 8:00	11/15/2005 17:00
248	Gap Analysis	10.d	11/2/2005 8:00	11/15/2005 17:00
249	SD Configuration	10.d	11/2/2005 8:00	11/15/2005 17:00
250	Testing ( manual)	10.d	11/2/2005 8:00	11/15/2005 17:00
251	Basic Configuration for master data transfer from Guadalajara	11.d	10/24/2005 8:00	11/7/2005 17:00	242
252	MRP Controller	5.2d	10/24/2005 8:00	11/2/2005 17:00
253	Purchasing Group	8.d	10/24/2005 8:00	11/2/2005 17:00
254	Capacity Planner	8.d	10/24/2005 8:00	11/2/2005 17:00
255	Production Scheduler	8.d	10/24/2005 8:00	11/2/2005 17:00
256	Inactive Version	8.d	10/24/2005 8:00	11/2/2005 17:00
257	Sales Office	7.8d	10/24/2005 8:00	11/7/2005 17:00
258	Sales Group	7.8d	10/24/2005 8:00	11/7/2005 17:00
259	Profit Centre	8.d	10/24/2005 8:00	11/2/2005 17:00
260	Cost Centre	8.d	10/24/2005 8:00	11/2/2005 17:00
261	STG5.0	43.d	11/16/2005 8:00	1/13/2006 17:00
262	Functionality Unit Test ( manual)	30.d	11/16/2005 8:00	12/27/2005 17:00
263	Support Integration Test with B2B	30.d	11/16/2005 8:00	12/27/2005 17:00
264	Support Integration test with MES	30.d	11/16/2005 8:00	12/27/2005 17:00
265	Support Integration Test with Zebra	30.d	11/16/2005 8:00	12/27/2005 17:00
266	Support Config and Gap Analysis for Interfaces	30.d	11/16/2005 8:00	12/27/2005 17:00
267	Enablement of reporting & exception messages for B2B / FTP jobs to Zebra systems	30.d	11/16/2005 8:00	12/27/2005 17:00
268	Move additional transportation to PRD 5.0	5.d	1/9/2006 8:00	1/13/2006 17:00
269	Data Conversion Activities	30.d	11/21/2005 8:00	12/30/2005 17:00
270	Activate STO or STOSA to support PCBA supplies from Existing Zebra Supplier(s) (TX02) to MY initially	14.d	11/21/2005 8:00	12/8/2005 17:00
271	Create QN Task Group	14.d	11/21/2005 8:00	12/8/2005 17:00
272	Identify material master /BOM to transfer from Guad	14.d	11/21/2005 8:00	12/8/2005 17:00
273	Upload AMPL	14.d	11/21/2005 8:00	12/8/2005 17:00
274	Setup Quality Inspection Plan	14.d	11/21/2005 8:00	12/8/2005 17:00
275	Identify new source	30.d	11/21/2005 8:00	12/30/2005 17:00
276	Create Info record & source List	30.d	11/21/2005 8:00	12/30/2005 17:00
277	Extend customer 1821 to Malaysia Sales Organization	14.d	11/21/2005 8:00	12/8/2005 17:00
278	Upload all the ZROHs (Every ZROH must have accounting and costing views created and loaded with the correct price.	14.d	11/21/2005 8:00	12/8/2005 17:00
279	Verify ZROHs data loaded	14.d	11/21/2005 8:00	12/8/2005 17:00
280	Upload HALBs and FERTs	14.d	11/21/2005 8:00	12/8/2005 17:00
281	Verify HALBs and FERTs loaded	14.d	11/21/2005 8:00	12/8/2005 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-72-


282	Structure the BOMs (ZBOM upload)	14.d	11/21/2005 8:00	12/8/2005 17:00
283	Upload SAP BOMs	14.d	11/21/2005 8:00	12/8/2005 17:00
284	Verify BOM data	14.d	11/21/2005 8:00	12/8/2005 17:00
285	Create new rate routing and production versions for all BOMs and cost collectors	14.d	11/21/2005 8:00	12/8/2005 17:00
286	Cost rolls (can be done over night) - Planning asks finance to do this	14.d	11/21/2005 8:00	12/8/2005 17:00
287	Training Phase	47.d	11/2/2005 8:00	1/5/2006 17:00
288	Test Zebra solution in DEV5.0 (020)	40.d	11/2/2005 8:00	12/27/2005 17:00
289	Finalize Gap between 4.6 B & DEV 5.0	40.d	11/2/2005 8:00	12/27/2005 17:00
290	Documentation on Gap	40.d	11/2/2005 8:00	12/27/2005 17:00
291	Share current Existing Zebra Supplier(s) system process	47.d	11/2/2005 8:00	1/5/2006 17:00
292	Train PEN site SME	40.d	11/2/2005 8:00	12/27/2005 17:00
293	Train Pen site user	40.d	11/2/2005 8:00	12/27/2005 17:00
294	Existing Zebra Supplier(s) and Jabil Regonal IT	74.d	10/10/2005 8:00	1/18/2006 17:00
295	Identify Jabil IT equip. to be moved (if any)	15.d	10/14/2005 8:00	11/3/2005 17:00
296	Copy custom MFG systems and send to Pg IT	13.d	10/10/2005 8:00	11/7/2005 16:12
297	Assist Selected Jabil Manufacturing Location(s) Team in loading and testing custom MFG Systems software	24.d	11/1/2005 8:00	12/2/2005 17:00
298	Identify IT documents that will need to be translated	11.d	10/14/2005 8:00	10/28/2005 17:00
299	Participate in SAP upgrade testing - EPS Delivery Download	45.d	11/14/2005 8:00	1/13/2006 17:00
300	EPS configuration changes	45.d	11/14/2005 8:00	1/13/2006 17:00
301	Send Selected Jabil Manufacturing Location(s) Label Matrix software for label design	21.d	10/18/2005 8:00	11/15/2005 17:00
302	Moving Zebra test servers ,switches,test stations	1.d	11/8/2005 8:00	11/8/2005 17:00
303	Build History data transfer	3.d	1/16/2006 8:00	1/18/2006 17:00
304	Transfer ECN data base (with data)	5.d	10/24/2005 8:00	10/28/2005 17:00
305	Identify customer specific sys.	1.d	11/8/2005 8:00	11/8/2005 17:00
306	Identify Zebra owned equip.	1.d	10/19/2005 8:00	10/19/2005 17:00
307	Customer Order file for sys. Test	1.d	10/19/2005 8:00	10/19/2005 17:00
308	Identify Guad to Zebra Networking Infrastructure	4.d	10/25/2005 8:00	11/3/2005 17:00	307
309	Existing Zebra Supplier(s) SME and SAP Support	17.75d	10/19/2005 8:00	11/11/2005 15:00
310	Create Test Plan for SAP Upgrade	2.d	10/19/2005 8:00	10/20/2005 17:00
311	Create Test Data for SAP Upgrade Testing	1.d	10/21/2005 8:00	10/21/2005 17:00	310
312	SAP Upgrade Testing - SD Functionality	10.d	10/24/2005 8:00	11/4/2005 17:00	311
313	SAP Upgrade Testing - EPS Delivery Download	1.d	10/27/2005 8:00	11/7/2005 10:00	312
314	SAP Upgrade Testing - Serial Number scan at backflush	1.d	10/28/2005 8:00	11/8/2005 9:12	313
315	SAP Upgrade Testing - Financial	1.d	10/31/2005 8:00	11/9/2005 8:24	314
316	SAP Upgrade Testing - Custom Reports	1.d	10/28/2005 8:00	11/7/2005 11:12	313

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-73-


317	GAP analysis and Functional specifications for SAP Upgrade	3.d	11/1/2005 8:00	11/11/2005 11:36	311,312,313,314,315,316
318	Create Training Plan for Existing Zebra Supplier(s) SMEs	2.d	11/4/2005 8:00	11/11/2005 15:00	317
319	Corporate B2B & SAP	64.9d	10/19/2005 8:00	1/16/2006 16:12
320	Create BizTalk project	2.d	10/19/2005 8:00	10/20/2005 17:00
321	Import 3A4 PIP Schema	2.d	10/19/2005 8:00	10/20/2005 17:00
322	Generate IDoc interface schema	3.d	11/4/2005 8:00	11/8/2005 17:00	321
323	Generate BAPI interface schemas for RFC checks for IDoc delivery	6.d	10/19/2005 8:00	10/26/2005 17:00	322
324	Create initial IDOC Map based on Zebra Specs	2.d	10/27/2005 8:00	10/28/2005 17:00	323
325	Validate IDOC Map and Revise based on ECC 5.0 Testing	1.d	10/31/2005 8:00	10/31/2005 17:00	324
326	Map incoming 3A4 request to IDOC	17.5d	10/19/2005 8:00	11/18/2005 17:00	325
327	Import IDOC submit process from Alcatel Brest process for guaranteed delivery to SAP	3.d	11/4/2005 13:00	11/21/2005 16:12	326
328	Map incoming 3A4 request to RFC request	4.d	11/9/2005 13:00	11/22/2005 16:12	327
329	Map RFC response and 3A4 request to 3A4 response (confirmation) based on status success/fail	3.d	11/22/2005 16:12	11/25/2005 16:12	328
330	Correlate or pull RFC (3A4) from SAP and map to 3A4	1.d	11/25/2005 16:12	11/28/2005 16:12	329
331	Map RFC responses to Notification messages	1.d	11/28/2005 16:12	11/29/2005 16:12	330
332	Create an Orchestration for main process flow of Rcv’s, Mappings and Timeout/RFC retries	1.d	11/29/2005 16:12	11/30/2005 16:12	331
333	Create a Notification Orchestration	2.d	11/30/2005 16:12	12/2/2005 16:12	332
334	Extrapolate all environment settings, dependencies and constants into a configuration file	.5d	12/2/2005 16:12	12/5/2005 11:12	333
335	Create a setup script (required for a disaster recovery)	.5d	12/5/2005 11:12	12/5/2005 16:12	334
336	Create Rules for communication level error notifications	.5d	12/5/2005 16:12	12/6/2005 11:12	335
337	Create documentation	20.d	12/6/2005 11:12	1/3/2006 11:12	336
338	Unit Testing	6.d	11/28/2005 16:12	12/6/2005 16:12	330
339	Integration Testing	30.d	12/6/2005 16:12	1/16/2006 16:12	338
340	EDM	54.d	11/1/2005 8:00	1/13/2006 17:00
341	Provide name list for PDM uses to Zebra	4.d	11/7/2005 8:00	11/10/2005 17:00
342	Provide DUNN#s to Zebra	14.d	11/1/2005 8:00	11/18/2005 17:00
343	Zebra to grant Access to new users	30.d	11/11/2005 8:00	12/22/2005 17:00	341FS-6 days,342FS-6 days
344	Complete Training on PDM	5.d	1/9/2006 8:00	1/13/2006 17:00
345	Complete Training on ECN process	17.d	11/8/2005 8:00	11/30/2005 17:00
346	Prepare Selected Jabil Manufacturing Location(s) System for MPS Load	40.d	11/8/2005 8:00	1/2/2006 17:00	251
347	Grant SME admin to Existing Zebra Supplier(s) SAP	40.d	11/11/2005 15:00	1/6/2006 15:00	318
348	Upload Existing Zebra Supplier(s) AVL to Selected Jabil Manufacturing Location(s)	10.d	12/9/2005 8:00	12/22/2005 17:00	273

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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349	Order Administration	57.d	11/8/2005 8:00	1/24/2006 17:00
350	Training documentation for OA	15.d	11/8/2005 8:00	11/28/2005 17:00
351	Define process for cutting over sales orders to include ESD set dates	24.d	11/25/2005 8:00	12/28/2005 17:00
352	Cut Over Sales Orders	57.d	11/8/2005 8:00	1/24/2006 17:00
353	Material	59.d	11/10/2005 8:00	1/30/2006 17:00
354	Pull material documentation from Existing Zebra Supplier(s)	2.d	11/10/2005 8:00	11/11/2005 17:00
355	Data Verification of MM and AMPL	5.d	11/14/2005 8:00	11/18/2005 17:00	354
356	Create Material Group	2.d	11/21/2005 8:00	11/22/2005 17:00	355
357	Create Profit Centre	1.d	11/21/2005 8:00	11/21/2005 17:00	355
358	Create QN Task Group	2.d	11/21/2005 8:00	11/22/2005 17:00	355
359	Upload Material master	5.d	11/23/2005 8:00	11/29/2005 17:00	356
360	Upload AMPL	5.d	11/21/2005 8:00	11/25/2005 17:00	355
361	Setup Quality Inspection Plan	3.d	11/25/2005 8:00	11/29/2005 17:00	359FS-3 days,360FS-3 days
362	Issue STO to Guadalajara for material transfer	3.d	11/25/2005 8:00	11/29/2005 17:00	359FS-3 days,360FS-3 days
363	PCBA and Material kitted by Existing Zebra Supplier(s) for verification	14.d	11/30/2005 8:00	12/19/2005 17:00	362
364	Material Verifictaion,buy off and Packing Existing Zebra Supplier(s)	17.d	11/30/2005 8:00	12/22/2005 17:00	363SS
365	Ship Material from Existing Zebra Supplier(s)	20.d	12/8/2005 8:00	1/4/2006 17:00
366	Receive Material in Pg - SMT and DF	5.d	12/29/2005 8:00	1/4/2006 17:00	365FS-5 days
367	Verification of material received in terms of Quantity,Part# and Condition	5.d	1/5/2006 8:00	1/11/2006 17:00	366
368	IQA Buy-off and QN clearance to stock in store	14.d	1/12/2006 8:00	1/30/2006 17:00	367
369	Define Material Transfer Process flow	8.d	11/30/2005 8:00	12/9/2005 17:00	362
370	Provide Blanket Order for shipment of all material from Existing Zebra Supplier(s)	15.d	11/30/2005 8:00	12/20/2005 17:00	362
371	Traffic and Shipping	40.d	11/1/2005 8:00	12/26/2005 17:00
372	Understand requirements for shipment to / from Israel	40.d	11/1/2005 8:00	12/26/2005 17:00
373	Understand requirements for shipment to / from Existing Zebra Supplier(s)	12.d	11/7/2005 8:00	11/22/2005 17:00
374	Understand Trade American Act (TAA) requirements and impact	12.d	11/7/2005 8:00	11/22/2005 17:00
375	QA	91.d	10/21/2005 8:00	2/23/2006 17:00
376	FA / NPI readiness checklist	17.d	11/8/2005 8:00	11/30/2005 17:00
377	Review with Zebra	17.d	11/8/2005 8:00	11/30/2005 17:00
378	Document Control	7.d	11/28/2005 8:00	12/6/2005 17:00
379	Set up DMS for Zebra project	7.d	11/28/2005 8:00	12/6/2005 17:00	169
380	Set-up database for Zebra Vas	7.d	11/28/2005 8:00	12/6/2005 17:00	169

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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381	Label Configuration	40.d	1/2/2006 8:00	2/23/2006 17:00
382	Require Label printing functional specs.	40.d	1/2/2006 8:00	2/23/2006 17:00	178
383	Verify on use of Loftware type software	40.d	1/2/2006 8:00	2/23/2006 17:00	178
384	Require Image files	40.d	1/2/2006 8:00	2/23/2006 17:00	178
385	EPS Configuration	25.d	11/28/2005 8:00	12/30/2005 17:00
386	Configurate for each platform - DF	20.d	12/1/2005 8:00	12/30/2005 17:00	192
387	Configurate for each platform - SMT	20.d	11/28/2005 8:00	12/23/2005 17:00	169
388	Need Zebra to assign factory code for Jabil Pg.	7.d	12/1/2005 8:00	12/20/2005 15:00	192
389	Regulatory Requirements	14.d	11/8/2005 8:00	11/25/2005 17:00
390	Any specific requirements	14.d	11/8/2005 8:00	11/25/2005 17:00
391	Platforms that are being subjected to this requirement	14.d	11/8/2005 8:00	11/25/2005 17:00
392	Copy of Regulatory certification document from Zebra	10.d	11/8/2005 8:00	11/21/2005 17:00
393	Need Zebra to include Jabil Selected Jabil Manufacturing Location(s) as the manufacturing plant	14.d	11/8/2005 8:00	11/25/2005 17:00
394	ESD Control	20.d	11/8/2005 8:00	12/5/2005 17:00
395	Require Zebra ESD specification	14.d	11/8/2005 8:00	11/25/2005 17:00
396	Check on use of ESD chairs in Existing Zebra Supplier(s)	3.d	11/8/2005 8:00	11/10/2005 17:00
397	Review Zebra ESD specifications against Pg and close gap	20.d	11/8/2005 8:00	12/5/2005 17:00
398	Mode of feedback from Zebra	7.d	11/8/2005 8:00	11/16/2005 17:00
399	Issuance of CAR	2.d	11/8/2005 8:00	11/9/2005 17:00
400	Zebra CAR system for Selected Jabil Manufacturing Location(s) response	2.d	11/8/2005 8:00	11/9/2005 17:00
401	Require Previous customer complaints and 8D report	3.d	11/8/2005 8:00	11/10/2005 17:00
402	Mode of reporting to Zebra	1.d	11/8/2005 8:00	11/8/2005 17:00
403	Type of reports and frequency	7.d	11/8/2005 8:00	11/16/2005 17:00
404	Report format for NPI,QBR,FA or Pilot,etc.	7.d	11/8/2005 8:00	11/16/2005 17:00
405	History card on Existing Zebra Supplier(s) quality control/assurance activities	36.d	10/21/2005 8:00	12/9/2005 17:00
406	Zebra Qualification Plan	3.d	10/21/2005 8:00	10/25/2005 17:00
407	Yield report , Defect Analysis & CA	7.d	11/8/2005 8:00	11/16/2005 17:00
408	Transfer FMEA and Control Plan from Existing Zebra Supplier(s)	19.d	10/31/2005 8:00	11/24/2005 17:00
409	RMA Process methodology	3.d	11/8/2005 8:00	11/10/2005 17:00
410	Transfer Incoming Material Inspection Plan from Guad	12.d	11/8/2005 8:00	11/23/2005 17:00
411	Gap analysis of Tools / Gauge / Calibration requirement	24.d	11/8/2005 8:00	12/9/2005 17:00
412	QBR Past Performance	10.d	11/8/2005 8:00	11/21/2005 17:00
413	Method used to set yield targets	2.d	11/8/2005 8:00	11/9/2005 17:00
414	When and why targets revised	2.d	11/8/2005 8:00	11/9/2005 17:00
415	Score Card Training	10.d	11/8/2005 8:00	11/21/2005 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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416	Quality Criteria	25.d	11/8/2005 8:00	12/12/2005 17:00
417	Specific Inspection criteria from Zebra -PCBA	25.d	11/8/2005 8:00	12/12/2005 17:00
418	Specific Inspection criteria from Zebra -DF	25.d	11/8/2005 8:00	12/12/2005 17:00
419	ROHS requirements	25.d	11/8/2005 8:00	12/12/2005 17:00
420	Test Engineering	122.d	11/8/2005 8:00	4/25/2006 17:00
421	List of all Zebra Test Equipment Needed	59.d	11/8/2005 8:00	1/26/2006 17:00
422	5DX -Use existing unit in Selected Jabil Manufacturing Location(s)	5.d	1/2/2006 8:00	1/6/2006 17:00
423	ICT - Use existing unit in Selected Jabil Manufacturing Location(s)	5.d	1/2/2006 8:00	1/6/2006 17:00
424	SMT FVT Station	20.d	1/2/2006 8:00	1/26/2006 17:00
425	SMT & DF ESS - use existing units in Selected Jabil Manufacturing Location(s)	5.d	1/2/2006 8:00	1/6/2006 17:00
426	Mock-up DF FVT Station in Selected Jabil Manufacturing Location(s)	40.d	11/8/2005 8:00	1/2/2006 17:00
427	DF Hi Pot Tester from Existing Zebra Supplier(s)	25.d	11/8/2005 8:00	12/12/2005 17:00
428	Mock-up PCA FVT Stations in Selected Jabil Manufacturing Location(s)	40.d	11/8/2005 8:00	1/2/2006 17:00
429	ICT Fixtures & Test Programs	63.d	1/27/2006 8:00	4/25/2006 17:00
430	Transfer existing fixtures from Existing Zebra Supplier(s) for Ramp and Mass Production	30.d	3/15/2006 8:00	4/25/2006 17:00	41
431	Transfer 5DX Programs	10.d	1/27/2006 8:00	2/9/2006 17:00	421
432	ESS time for Qual and Mass Production	24.d	1/27/2006 8:00	3/1/2006 17:00	421
433	Transfer Test Note Book from Existing Zebra Supplier(s) (History Book )	24.d	3/15/2006 8:00	4/17/2006 17:00	41
434	Control Tools and Matrics Transfer	30.d	1/27/2006 8:00	3/9/2006 17:00	421
435	PR Preparation & CER Preparation	47.d	1/27/2006 8:00	4/3/2006 17:00
436	POs approve	3.d	1/27/2006 8:00	1/31/2006 17:00	421
437	Purchase of fixtures/ESS chambers/modify configuration	40.d	2/1/2006 8:00	3/28/2006 17:00	436
438	Setup of chambers/ovens	4.d	3/29/2006 8:00	4/3/2006 17:00	437
439	Change of serial # format	61.d	11/8/2005 8:00	1/30/2006 17:00
440	Specify new Format	35.d	11/8/2005 8:00	12/26/2005 17:00
441	Integrate format into all test codes	10.d	12/27/2005 8:00	1/9/2006 17:00	440
442	Configure TARS to new format	10.d	1/10/2006 8:00	1/20/2006 17:00	441
443	Check TARS for new format	6.d	1/23/2006 8:00	1/30/2006 17:00	442
444	Receive Servers in Selected Jabil Manufacturing Location(s)(shared SMT/DF server,SWINST)	31.d	11/28/2005 8:00	1/9/2006 17:00
445	Connect servers and set-up test for trial	10.d	11/28/2005 8:00	12/9/2005 17:00	169
446	Validate transfer of failure data into TARS into test equipment	7.d	12/12/2005 8:00	12/20/2005 17:00	445

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-77-


447	Qualify Test functionality (parallel equipment sets)	7.d	12/21/2005 8:00	12/29/2005 17:00	446
448	Validate continuity of TARS data between sites	7.d	12/30/2005 8:00	1/9/2006 17:00	447
449	Training Travel Schedule	40.d	11/14/2005 8:00	1/6/2006 17:00
450	Quality Engineering Lead	15.d	11/14/2005 8:00	12/2/2005 17:00
451	Industrial Engineering Lead	15.d	11/14/2005 8:00	12/2/2005 17:00
452	Business Analyst	10.d	11/14/2005 8:00	11/25/2005 17:00
453	SAP Support Specialist	10.d	11/14/2005 8:00	11/25/2005 17:00
454	Program Analyst	10.d	11/14/2005 8:00	11/25/2005 17:00
455	Material Supervisor	15.d	12/5/2005 8:00	12/23/2005 17:00
456	ECO Coordinator	15.d	11/14/2005 8:00	12/2/2005 17:00
457	Test Engineer	10.d	12/5/2005 8:00	12/16/2005 17:00
458	Debug Technician	20.d	11/14/2005 8:00	12/9/2005 17:00
459	Lead Buyer	15.d	12/19/2005 8:00	1/6/2006 17:00
460	SMT Planner	15.d	12/5/2005 8:00	12/23/2005 17:00
461	Sr. Planner	11.d	12/19/2005 8:00	1/2/2006 17:00
462	Order Administrator	11.d	12/19/2005 8:00	1/2/2006 17:00
463	Debug Engineer	15.d	12/5/2005 8:00	12/23/2005 17:00
464	Production Supervisor	15.d	12/5/2005 8:00	12/23/2005 17:00
465	Warehouse Officer	20.d	12/5/2005 8:00	12/30/2005 17:00
466	Test Engineering Lead	10.d	11/14/2005 8:00	11/25/2005 17:00
467	Manufacturing Engineering Lead	10.d	12/5/2005 8:00	12/16/2005 17:00
468	Manufacturing Engineer	10.d	12/5/2005 8:00	12/16/2005 17:00
469	Work Cell Manager	10.d	12/5/2005 8:00	12/16/2005 17:00
470	Business Unit Manager	5.d	11/21/2005 8:00	11/25/2005 17:00
471	Traffic	5.d	12/12/2005 8:00	12/16/2005 17:00
472	Selected Jabil Manufacturing Location(s) DF Qualification	74.d	10/24/2005 8:00	2/1/2006 17:00
473	Generate Pg. Layout	2.d	11/29/2005 8:00	11/30/2005 17:00
474	Layout Approval	3.d	11/29/2005 8:00	12/1/2005 17:00
475	PR and PO issuance for facilitization work	5.d	12/2/2005 8:00	12/8/2005 17:00	474
476	PR and PO for manufacturing workstations and small tools	10.d	12/7/2005 8:00	12/20/2005 17:00
477	ReLocation(s) of machinery and facilitization work	15.d	12/14/2005 8:00	1/9/2006 12:00	475,476
478	Line set-up ,Install workbench ,small tools and IT links	10.d	12/26/2005 8:00	1/6/2006 17:00	482
479	Line Buy-Off for acceptance and ESD compliance	1.d	1/9/2006 8:00	1/9/2006 17:00	478
480	Documents - BOM,Engineering drawings,VA,PCF PCP	30.d	12/5/2005 8:00	1/13/2006 17:00	451
481	Details on Packaging Material & Labels	15.d	12/5/2005 8:00	12/23/2005 17:00	451
482	Network Requirement/PC requirement	15.d	12/5/2005 8:00	12/23/2005 17:00	451
483	DF Planning on SAP Transaction	20.d	12/15/2005 8:00	1/11/2006 17:00
484	Identify MRO items	12.d	12/15/2005 8:00	12/30/2005 17:00
485	Identify Mechanical rework process requirement	15.d	12/12/2005 8:00	12/30/2005 17:00
486	Identify Material Inspection Criterias	7.d	1/2/2006 8:00	1/10/2006 17:00

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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487	Identify Unique Process Details	12.d	11/30/2005 8:00	12/15/2005 17:00	450FF+4 days
488	Identify OBA Inspection Criterias	5.d	1/9/2006 8:00	1/13/2006 17:00	449
489	Planning of DL headcount	2.d	1/9/2006 8:00	1/10/2006 17:00	449
490	Receive Qual Plan from Zebra	10.d	10/24/2005 8:00	11/4/2005 17:00
491	Finalise Priority Product Build List	5.d	11/15/2005 8:00	11/21/2005 17:00	490
492	Zebra DF Qualification Start	1.d	1/16/2006 8:00	1/16/2006 17:00	39,125,350,371,376,398, 394,389,405,418,426,427, 448,339
493	Product Priority for Qualification	12.d	1/17/2006 8:00	2/1/2006 17:00
494	Hilo NBB7255000 IP1260 Flash Based w/Disk System qty=5 ( 2 ship to FCE IN Mt View & 3 units verified by Zebra MQE in Pg.)	4.d	1/17/2006 8:00	1/20/2006 17:00	492SS
495	Hilo NCZ0501000 North American/Japan Power Cord (15 Amp)	1.d	1/20/2006 8:00	1/20/2006 17:00	494FS-1 day
496	Hilo NIF4404000 Four Port 10/100 MBps Ethernet PMC Interface, IP12XX	1.d	1/20/2006 8:00	1/20/2006 17:00	494FS-1 day
497	TrooperNBB4385000 IP385 Flash Base System Bundle w/1 GB Memory qty=5( 2 ship to FCE IN Mt View & 3 units verified by Zebra MQE in Pg.)	2.d	1/19/2006 8:00	1/20/2006 17:00	494FS-2 days
498	Trooper NCZ0300000 North America/Japan Power Cord (10 Amp)	1.d	1/20/2006 8:00	1/20/2006 17:00	497FS-1 day
499	Trooper NIF4214000 Zebra Encryption Accelerator II PMC	1.d	1/20/2006 8:00	1/20/2006 17:00	497FS-1 day
500	Baja NBC0265000 Zebra IP265 Two-system Bundle qty= 5( 2 ship to FCE IN Mt View & 3 units verified by Zebra MQE in Pg.)	2.d	1/20/2006 8:00	1/23/2006 17:00	497FS-1 day
501	Baja NCZ0300000 North America/Japan Power Cord (10 Amp)	1.d	1/23/2006 8:00	1/23/2006 17:00	500FS-1 day
502	Kona NBB2250000 IP2250 Base System Bundle qty=5( 5 units verified by Zebra MQE in Pg.to be used against customer orders)	2.d	1/23/2006 8:00	1/24/2006 17:00	500FS-1 day
503	Kona NCZ0501000 North American/Japan Power Cord (15 Amp)	1.d	1/24/2006 8:00	1/24/2006 17:00	502FS-1 day
504	Kona NIF4500000 Dual Port Gigabit Ethernet ADP Interface Card, IP2250	1.d	1/24/2006 8:00	1/24/2006 17:00	502FS-1 day
505	710 NBB2710000 IP710 Base System Bundle qty=5( 5 units verified by Zebra MQE in Pg.to be used against customer orders)	2.d	1/24/2006 8:00	1/25/2006 17:00	502FS-1 day
506	710 NCZ0501000 North American/Japan Power Cord (15 Amp)	1.d	1/25/2006 8:00	1/25/2006 17:00	505FS-1 day
507	710 NIF4204000 Single Port Gigabit Ethernet cPCI MMF Interface Card	1.d	1/25/2006 8:00	1/25/2006 17:00	505FS-1 day

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-79-


508	Amigo NBB2403000 IP40 Satellite 16 Base System Bundle qty=5( 5 units verified by Zebra MQE in Pg.to be used against customer orders)	2.d	1/25/2006 8:00	1/26/2006 17:00	505FS-1 day
509	Amigo NCZ0300000 North America/Japan Power Cord (10 Amp)	1.d	1/26/2006 8:00	1/26/2006 17:00	508FS-1 day
510	Palomar NBB5011000 Zebra 10i Base System Bundle qty=5( 5 units verified by Zebra MQE in Pg.to be used against customer orders)	2.d	1/26/2006 8:00	1/27/2006 17:00	508FS-1 day
511	Palomar NCZ0300000 North America/Japan Power Cord (10 Amp)	1.d	1/27/2006 8:00	1/27/2006 17:00	510FS-1 day
512	IP-Vpn NBC5001000 Zebra 50i Two-system Bundle (2 units for clustering) qty=5 ( 5 units verified by Zebra MQE in Pg.to be used against customer orders)	2.d	1/27/2006 8:00	1/30/2006 17:00	510FS-1 day
513	IP-Vpn NCZ0300000 North America/Japan Power Cord (10 Amp)	1.d	1/30/2006 8:00	1/30/2006 17:00	512FS-1 day
514	NSAS NBL8100000 Zebra 100s SSL VPN w/100 User License qty=5( 5 units verified by Zebra MQE in Pg.to be used against customer orders)	2.d	1/30/2006 8:00	1/31/2006 17:00	512FS-1 day
515	NSAS NCZ0501000 North American/Japan Power Cord (15 Amp)	1.d	1/31/2006 8:00	1/31/2006 17:00	514FS-1 day
516	Zebra DF Quakification Finish	1.d	2/1/2006 8:00	2/1/2006 17:00	514
517	Selected Jabil Manufacturing Location(s) SMT Qualification	104.d	10/24/2005 8:00	3/15/2006 17:00
518	Generate Pg. Layout	2.d	11/8/2005 8:00	11/9/2005 17:00
519	Layout Approval	3.d	11/29/2005 8:00	12/1/2005 17:00	518FS+13 days
520	PR and PO issuance for facilitization work	5.d	12/2/2005 8:00	12/8/2005 17:00	519,518
521	PR and PO for manufacturing workstations ,small tools machines	5.d	12/2/2005 8:00	12/8/2005 17:00	519
522	Swap MPM 3000 Paste Printer	1.d	1/13/2006 8:00	1/13/2006 17:00	519FS+30 days
523	Purchase of HSP 4796(L) ( Any used or refurbished unit available?)	40.d	11/17/2005 8:00	1/11/2006 17:00	521FS-16 days
524	Purchase of 10Zone Reflow (Any used or refurbished unit available)	40.d	11/17/2005 8:00	1/11/2006 17:00	521FS-16 days
525	Purchase Wave Solder m/c for Lead free compatible	40.d	11/17/2005 8:00	1/11/2006 17:00	521FS-16 days
526	ReLocation(s) of machinery and facilitization work	10.d	1/2/2006 8:00	1/13/2006 17:00	520FS+16 days,521
527	Line set-up ,Install workbench ,small tools and IT links	15.d	1/2/2006 8:00	1/19/2006 17:00	521FS+16 days
528	Line Buy-Off for acceptance and ESD compliance	3.d	1/20/2006 8:00	1/24/2006 17:00	527
529	Gerber data transfer	59.d	11/7/2005 8:00	1/25/2006 17:00	545
530	SMT Program Transfer from Existing Zebra Supplier(s)	59.d	11/7/2005 8:00	1/25/2006 17:00	545
531	List of Tooling for Qual to be transferred from Existing Zebra Supplier(s) & scheduled dates	22.d	11/7/2005 8:00	12/6/2005 17:00	545

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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532	Identify Tooling to be fabricated in Pg.	50.d	12/7/2005 8:00	2/13/2006 17:00	531
533	Prepare VAs	56.d	11/7/2005 8:00	1/20/2006 17:00	545
534	PCP & PCF Document	45.d	11/8/2005 8:00	1/9/2006 17:00
535	FMEA and DFM report from Existing Zebra Supplier(s)	41.d	11/7/2005 8:00	1/2/2006 17:00	545
536	ROHS failure analysis report from Existing Zebra Supplier(s) for solder content	41.d	11/7/2005 8:00	1/2/2006 17:00	545
537	Process MRO item list from Existing Zebra Supplier(s)	35.d	11/7/2005 8:00	12/23/2005 17:00	545
538	Mechanical Samples of PCBA	35.d	11/8/2005 8:00	12/26/2005 17:00
539	Solder samples from Existing Zebra Supplier(s)	35.d	11/8/2005 8:00	12/26/2005 17:00
540	Temperature Profile boards from Existing Zebra Supplier(s)	34.d	11/8/2005 8:00	12/23/2005 17:00
541	Temperature Profile settings for Oven and Wave from Existing Zebra Supplier(s)	34.d	11/8/2005 8:00	12/23/2005 17:00
542	Information on Type of Chemistry used	13.d	11/8/2005 8:00	11/24/2005 17:00
543	Determine Compatibility for CAD,Crimbridge and Router Solutions,Licences..	13.d	11/8/2005 8:00	11/24/2005 17:00
544	TIC cross-over (JOS)	25.d	11/8/2005 8:00	12/12/2005 17:00
545	Receive Ouql Plan from Zebra	10.d	10/24/2005 8:00	11/4/2005 17:00
546	Finalise Priority Product Build List	5.d	11/15/2005 8:00	11/21/2005 17:00	545
547	Zebra SMT Qualification Start / Finish	31.d	2/1/2006 8:00	3/15/2006 17:00	351,352,417,419,428,424, 423,422,443,448
549	Product Priority for Qualification Process	29.d	2/2/2006 8:00	3/15/2006 8:00
550	Hilo N805827003 LNF , LED qty=30	2.d	2/2/2006 8:00	2/3/2006 17:00	547SS+1 day
551	Hilo N805926001 HT Crossover qty=30	2.d	2/3/2006 8:00	2/6/2006 17:00	547SS+2 days
552	Hilo N805826004 Power Supply MP qty=30	2.d	2/6/2006 8:00	2/7/2006 17:00	547SS+3 days
553	Hilo N805551002 Hilo HD qty=30	2.d	2/7/2006 8:00	2/8/2006 17:00	547SS+4 days
554	Hilo N806170006 Viper 4 qty=30	2.d	2/8/2006 8:00	2/9/2006 17:00	547SS+5 days
555	Hilo N805895002 IDE MP qty=30	3.d	2/10/2006 8:00	2/14/2006 17:00	547SS+7 days
556	Hilo N805894002 I/O MPqty=30	2.d	2/14/2006 8:00	2/15/2006 17:00	547SS+9 days
557	Hilo N805888001 Dual GigE qty=30	2.d	2/15/2006 8:00	2/16/2006 17:00	547SS+10 days
558	Hilo N805892003 Quad 10 100 PMC=30	2.d	2/17/2006 8:00	2/20/2006 17:00	547SS+12 days
559	Hilo N805945002 6U PMC Carrier qty=30	2.d	2/21/2006 8:00	2/22/2006 17:00	547SS+14 days
560	Hilo N806487001 IP 7210qty= 30	3.d	2/23/2006 8:00	2/27/2006 17:00	547SS+16 days
561	Trooper N806806002 IP385 Refresh qty=30	3.d	2/24/2006 8:00	2/28/2006 17:00	547SS+17 days
562	Baja N806262005 IP265 qty=30	3.d	2/27/2006 8:00	3/1/2006 17:00	547SS+18 days
563	SMT Qual finish	.d	3/15/2006 8:00	3/15/2006 8:00
564	Selected Jabil Manufacturing Location(s) Ramp up	.d	3/15/2006 8:00	3/15/2006 8:00	41,72FS-15 days

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT D

Critical Personnel

[*** Redacted]

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT E

Manufacturer’s Business Continuity Plan

LOGO

Jabil Circuit


CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 76/9.

1.0

PURPOSE

1.1

These guidelines are designed to govern all Jabil sites in Asia, the Americas and Europe to adhere to and understand the responsibilities on how to implement the Contagious Diseases Contingency Plan in the event the site is partially or completely shut down due to confirmed cases of a Contagious Disease among employees.

1.2	The contingency plans shall cater to continuous operation of Jabil’s business without disrupting production or creating downtime in order to meet customers’ needs according to the applicable Business Recovery Plan (BRP).

1.3	All sites are expected to act in strict compliance to with these guidelines, while working closely with the suppliers, local health and Customs authorities.

2.0

SCOPE

2.1	These guidelines are applicable and cover all Jabil sites throughout Asia, the Americas and Europe.

3.0

APPROVAL

3.1	These guidelines can only be revised or modified by the Vice President of Human Resources.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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3.2	Prior approval is required by individual sites if these guidelines have to be altered of its stated meaning and contents.

4.0

DEFINITION

4.1	CD: Contagious Diseases

4.2	BRP : Business Recovery Plan

4.3	WHO: World Health Organization

4.4	HR: Human Resource

4.5	Level One: Plant is still operational with confirmed cases of CD

4.6	Level Two: Plant is total shutdown with confirmed cases of CD


CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 77/9

4.7	Zone: A critical area in production

4.8	Task Force: Team identified to replace CD affected employees in their jobs.

5.0

REFERENCE

5.1	Contagious Diseases Guidelines – Global (refer to attached document in paragraph 9.2).

6.0

RESPONSIBILITY

6.1	It shall be the responsibility of the Operations Manager of each individual site to follow strictly all aspects of executing Level One and Level Two contingency plans in line with the applicable BRP.

6.2	The Operations Manager has to work closely with the local health authorities, Customs officials and suppliers to be proactive in having the contingency plans in place to meet production volumes as per customers’ orders.

6.3	Communication :

6.3.1

The site Operations Manager is responsible to advise Jabil’s Vice President of Communications and Vice President of Human Resources of any CD activity relating to Jabil employees and facilities immediately upon discovery.

6.3.2

No information should be provided to news sources (television, newspapers, magazines, radio) in the event CD is detected in a Jabil plant.

6.3.3

No worldwide messages or plant-wide messages should be sent without the consultation and review of Corporate Communications,

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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except when they include time-sensitive information critical to the health and safety of plant employees.

6.3.4

Corporate Communications should be copied on all plant-wide or company wide communications.


CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 78/9

7.0

GUIDELINES

7.1	Procedures set in these Guidelines can change as the situation on CD condition change and the Vice President of Human Resources will be responsible for notifying each site of any changes in the guidelines.

8.0

PROCEDURES

8.1	LEVEL ONE: PLANT IS STILL OPERATIONAL

8.1.1

The Operations Manager from each site is responsible to follow the general framework provided in the contingency guidelines and also have the CD Guidelines Global in place.

8.1.2

Each site shall have their own action plans developed as per the local government requirements and must be able to execute them in a timely manner working closely with their suppliers, local health and local custom authorities.

8.1.3

Materials expedite process shall be in place.

8.1.3.1

Materials manager must ensure Jabil’s material suppliers have their own Contagious Disease contingency plan in place so as not to disrupt the flow of materials for production when the plant is in need of parts.

8.1.3.2

The Materials manager shall work with the suppliers to assure that extra material demand (increased by the buffer build up) is available and at appropriate pricing (no price gouging/increases).

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.1.3.3

The Materials manager shall prepare an off site storage that is in a least likely to be affected “Contagious Disease free” zone—securing all logistics and security / fire hazard protection (insurance).

8.1.4

The site shall work closely with the local Customs and government authorities in advance to discuss and be prepared in all aspects of documentations, agreement, clearance and approvals to ship in or


CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 79/9

out production related gear from one state or country to another to remove red tape and unnecessary delays.

8.1.4.1

Respective Functional Managers should contact Custom officials and negotiate contingency plan support for moving any material and or gear (production related machineries, fixtures, testers, software, stencils) from the affected site to another location. The Functional Managers may need to deal with two separate Customs agencies for sending and receiving plants.

8.1.4.2

All necessary documentation and approvals should be prepared and be set on “stand by” to be invoked to active status by the authority of the local plant Operations Manager should Level 2 be realized. This must be ready for taking the gear out and returning the gear back to the original plant.

8.1.4.3

The materials manager is responsible to make contact with Customs officials and negotiate contingency plan support for moving any material and or gear from the affected site to another location. May need to deal with two separate Customs agencies for sending and receiving plants.

8.1.5

The Operations Managers and the respective Business Development personnel need to stay close to the situation to determine when to trigger

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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discussions with customers. Contact customer(s) and negotiate, reach agreement and approval on:

8.1.5.1

Appropriate level of buffer Finished Goods, demand adjustments, and cancellation protection.

8.1.5.2

Negotiate inventory buffer levels with customers, at their risk.

8.1.5.3

Agreement that customer pays for the buffer. Inventories shall be stored at an outside Contagious Disease free location or warehouse for shipment.

8.1.5.4

Negotiate with customer for creation of duplicate gear that is unique to the product (fixtures, jigs, test gear, etc.)

8.1.6

The Operations Manager in conjunction with the respective Business Development personnel is responsible to direct the


CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 80/9

shutdown of production by zones and setting a Task Force to continue running of production.

8.1.6.1

Areas such as Surface Mount Technology, back end, stores and any other production related location considered important shall be identified as critical zones.

8.1.6.2

People from other plants within the same site shall be considered to be in the task force as replacement work group.

8.1.6.3

For those sites with only one plant, production shall be relocated to other CD free sites in Asia, America or Europe which has the capabilities.

8.1.6.4

Each plant must develop a zone plan which shall include critical areas and names of assigned people to continue to run production for each Zone.

8.1.6.5

There shall be a procedure in place that spells out how the Task Force in the critical Zones carries out their day to day activities.

8.1.6.6

Before shutting down a Zone in the production floor, all possible avenues shall be explored and professional advice and help should have been received from the appropriate authorities.

8.1.6.7

In the event of a possible shutdown, the Operations Manager shall at all times negotiate with the local health authorities with reasons to convince them not to close down the Zones or at least push for a compromise and settle for partial close down of Zones.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.1.7

The affected site Operations Manager has to proactively identify and communicate with the other site Operations Managers to prepare all arrangements necessary in the event of transfer, full or partial production, to other locations or sites during a shutdown.

8.1.7.1

This should include assuring available capacity, technical expertise and experience (potential transfer and learning of the product(s) as target for transfer.


CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 81/9

8.1.7.2

Ensure other sites are ready to duplicate their production gears, fixtures, ME and Test programs, stencils for immediate use during an emergency.

8.1.7.3

Using methods NOT requiring travel, such as: drawing, data, specification, line layout, workcell staffing chart, VA’s, set up sheets, programs for Surface Mount Technology, and other pertinent documentation should be duplicated and transferred.

8.1.8

Develop process for material transfer and special gear transfer from the plant during the initial stages of the plant shut down.

8.1.8.1

Need full “Bio suits” and other such measures to get in and out of the contaminated plant.

8.1.8.2

Secure proper tools, chemicals, methods, etc. for disinfections process of the gear prior to shipping to the designated plant location.

8.1.9

Upon re-opening of the plant, assure proper acceptance of the employees returning to work, proper transfer of the gear back to the plant.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 82/9

8.1.10

Upon re-opening, the affected site’s Operations Manager shall have plans ready and in place to secure the appropriate manpower from other plants and sites to run production.

8.1.11

The local Operations Manager is the contact person who keeps an updated list of all available unoccupied properties suitable for setting up manufacturing operations.

8.1.12

Back-up on IT information in plant accessible are: The local Operations Manager is responsible to ensure there is appropriate and adequate back-up of electronic data.

8.1.13

The Senior Director, Vice President of Operations of the impacted site and the Business Unit Director(s) of affected customers are the personnel who determine/decide which product can be transferred or relocated to other facilities.

8.1.14

Communication :

8.1.14.1

The site Operations Manager shall advise Vice President of Human Resources, Vice President of Communications and local Regional Human Resource Director of any contagious

8.1.14.2

disease activity relating to Jabil employees and facilities immediately upon discovery.

8.1.14.3

No information should be provided to news sources (television, newspapers, magazines, radio) in the event contagious disease is detected in a Jabil plant. All media calls should be directed to Jabil Corporate communications (727-803-3511 or 3349) without comment. Internal communication in the event of an outbreak should be limited to only those persons required.

8.1.14.4

No worldwide messages or plant-wide messages should be sent without the consultation, review and approval by VP of Human Resources and VP of Communications, except when they include time-sensitive information critical to the health and safety of plant employees. Corporate

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Communications should be copied on all plant-wide or company wide communications.

8.2	LEVEL TWO: PLANT IS TOTAL SHUTDOWN

(Level One Contingency Plan Guideline Applies).

8.2.1

Site Operations Manager with authority from Senior Director or Vice President of Operations of the affected region, after consultations with the appropriate Business Development representative(s), shall make decisions to relocate or transfer production to other plants or sites.

8.2.2

Each site shall have in place its own site recovery plan. Key items to consider shall be as follows:


CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 83/9

8.2.2.1

Respective area functional manager ensure all production related equipment, gears, fixtures, testers, stencils, software, build materials are all readily available and in place.

8.2.2.2

Workcells shall execute plans to utilize the 10 to 14 days built inventory stocks available for customer shipment. The site Operations Manager appoints a liaison person to handle all communications with employees and authorities.

8.2.2.3

Status of plant shall be communicated to employees by the appointed liaison person.

8.2.2.4

8.2.2.5

Management shall provide full cooperation to local health and government authorities

8.2.2.6

Employees shall be sent home and no one is allowed to enter plant until further notice.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.2.2.7

The whole plant shall be sanitized according to established or recommended procedures issued by local health authority, if available.

8.2.2.8

Local Human Resource representatives shall set up a helpdesk at the main guardhouse or another appropriate location to facilitate communication on the plant’s status to employees, suppliers, vendors, visitors and customers.

8.2.2.9

Business, Materials and Functional Managers who normally have customer contact and visitors shall inform them on production status and alternate arrangements on product transfer and relocations.

8.2.2.10

The site Operations Manager with advice from the health authorities shall decide on the plant’s timeline for reopening and initiating production.

8.3

Authority: The Senior Director and Vice President of Operations in the affected region have the responsibility to determine what business / activity can be moved to other sites. The actual authority must come from Business Unit Manager / Business Unit Director who shall decide which work can be transferred or relocated to other facilities throughout Asia and United States since they need to work with customer on the best overall solution to their specific supply chain problem.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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9.0

ATTACHMENT

9.1

Contagious Disease: Contingency Plan Flow Chart


CONTAGIOUS DISEASES CONTINGENCY PLAN: GUIDELINES	Doc. No.
	Prep. by	Rajedar Singh
	Approved by	Tom O’Connor
	Effective Date	Feb 1st, 2006
	Revision: 0	Page 84/9

LOGO

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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LOGO

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

-93-

9.2

Contagious Diseases Guidelines – Global


CONTAGIOUS DISEASES CONTINGENCY PLAN:GLOBAL	Doc. No.
	Prep. by	Tom O’Connor
	Approved by	Bill Peters
	Effective Date	Dec 19 ^th 2003
	Revision: 0	Page

1.0

PURPOSE

1.4

This policy is designed to govern all Jabil sites in Asia, Europe and the Americas to adhere to and understand the responsibilities on how to manage Contagious Diseases under the three alert levels as stated in this guidelines and their implementation shall never be compromised. All sites are expected to act in strict compliance to these guidelines.

2.0

SCOPE

2.1	This policy and its guidelines are applicable and cover all Jabil sites and its subsidiaries throughout Asia, Europe and the Americas.

3.0

APPROVAL

3.1	This policy can only be revised or modified by the Regional HR Manager with corporate liaison, Tom O’Connor’s approval.

Prior approval is required from Tom O’Connor by individual site if this policy has to be altered of its stated meaning and contents.

4.0

DEFINITION

4.9	CD : Contagious Disease

4.10	WHO : World Health Organization

4.11	HR: Human Resource

4.12	Condition Monitor: Suspected cases of Contagious Disease in the State / Province / Country.

4.13	Condition Alert : Suspected, Confirmed and Death CD cases in State / Province / Country.

5.0

REFERENCE

5.1	WHO, Federal and Local Health Ministry / Government Communications and Reports.

6.0

RESPONSIBILITY

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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6.1

It shall be the responsibility of each individual site to follow strictly on all alert levels communicated by Tom O’Connor through VP Operation in Asia, Europe and Americas.

7.0

GUIDELINES

7.1

Guidelines in this procedure can change as situations on CD conditions change globally. Tom O’Connor, as corporate liaison person, will advise Regional HR Manager and VP Operations in Asia, Europe and Americas on new instructions.

8.0

PROCEDURES

8.1

CONDITION MONITOR: There is Suspected cases of CD in the State / Province / Country.

8.1.1

The Managing Director or Operations Manager from each site is responsible to execute individual action plans to manage CD prevention and control.

8.1.1

Human Resource Manager must ensure all employees in their sites are well informed of CD virus and its danger to human life. Basic prevention and control measures must be in place.

8.1.1.1

If employees feel they are developing CD symptoms, HR shall advice them to:

8.1.1.1.1

Minimize unnecessary contact with others.

8.1.1.1.2

Wash hands, as often as possible.

8.1.1.1.3

Keep clean office area and all common utilities, sanitation facilities in the plant.

8.1.1.1.4

Inform supervisor, department manager or HR manager.

8.1.1.1.5

Consult Company Nurse or Doctor. Nurse shall advice on the next step of action.

8.1.2

Other Jabil site employees coming into plant from suspected CD or Non CD affected Asian, European or Americas site, state, province or country shall report to guardhouse to be screened for CD symptoms before allowed to enter plant (Refer to document, 9.1 CD Symptoms List). Person responsible shall be the host department manager.

8.1.2.1

Host department manager or delegate shall arrange company nurse to screen employee for CD symptoms.

8.1.2.1.1

Body temperature shall be measured to confirm there is no fever. Only after cleared by nurse, employee is allowed to enter plant.

8.1.2.1.2

Document 9.3, CD Status Recording Form shall be filled and signed by employee.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.1.2.2

If body temperature of employees is greater than 38 degrees Celsius, they shall be send to company panel clinic or government hospitals for further check on CD.

8.1.4

Local, Out station or Inbound suppliers, vendors and visitors coming into plant from suspected CD or Non CD affected state, province or country shall not be allowed to enter plant. However, if there shall be exception to be granted for visitors, Managing Director’s approval is required.

8.1.2.3

Jabil host department manager or delegate shall fill in Document 9.2, Visitor Approval Form, signed by Managing Director and pass a copy to guardhouse.

8.1.2.4

Suppliers, Vendors, Visitors when visiting plant shall undergo CD screening checks at guardhouse and shall fill and sign Document 9. 3, CD Status Recording Form.

8.1.3

Cafeteria staff, Security personnel and Cleaners who daily visit plant will be treated like Jabil employees.

8.1.3.1

Cafeteria supervisor is responsible to check and ensure his or her people are free from CD symptoms.

8.1.3.2

Random screening checks will be done by supervisor and records send to company clinic nurse for monitoring. Document 9.4, CD Status Record Form – Non Jabil Employee shall be used.

8.1.4

The company clinic shall be equipped with all necessary precautionary measures and facilities in prevention and control of CD.

8.1.5

Company panel of clinics must be instructed to report to HR if any of Jabil employees are suspected of having CD symptoms.

8.1.6

Managers and Supervisors should walk around to check their people are not having any basic symptoms of CD.

8.1.7

Managers and Supervisors shall update their people on the latest development in controlling and prevention of CD during their daily department meetings. (HR Manager shall update FMs)

8.1.8

Awareness materials to educate employees on CD shall be displayed in public areas in the plant. Individual site HR has to prepare materials as per local need.

8.1.9

HR shall instruct all employees to practice the basic hygiene needs to be clean. (e.g. washing hands often, washing hands with soap and water before and after meals, etc).

8.1.10

Business travel is allowed but employee must get a “CD free” symptom check from company nurse or panel doctor before commence of travel. The traveler/traveler’s manager must alert the site to be visited of an alert status prior to obtaining an approval to travel.

8.1.11

VP Operations Asia shall activate Condition Monitor for affected sites and will formally notify Tom O’Connor who will be responsible for alerting key personnel of “condition monitor alert” and for what sites it has been imposed.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.2

CONDITION ALERT (LEVEL ONE): There are confirmed CD cases in State / Province / Country.

8.2.1

CONDITION MONITOR, Para 8.1 applies together with the following:

8.2.2

Immediate notification to Tom O’Connor of location of confirmed case of CD, indicating when it was reported, how this information was obtained the process by which it was confirmed.

8.2.3

If a site employee returns from a non-CD affected Asia site or country, the employee must report to guardhouse.

8.2.3.1

The guard will take employee to company nurse to check for CD symptom.

8.2.3.2

Body temperature shall be measured to confirm there is no fever, i.e > 38 degree Celsius.

8.2.3.3

Document 9.3, CD Status Recording Form shall be filled by nurse.

8.2.3.4

A clear recording of arrival and departure time should be maintained for all visitors, vendors, suppliers, and other Jabil site employees at guardhouse.

8.2.4

If there is no CD symptom or fever, employee will be allowed to report to work, otherwise will be sent to company clinic or government hospital for further CD checks.

8.2.5

Employees returning from a CD affected site or country, shall stay in home quarantine for duration of 10 days or more depending on the type of CD case.

8.2.6

During this period, employee shall not travel and shall go through a daily CD symptom tests at the company panel clinic nearby his or her home or by oneself using the correct medical instruments as per advised by company nurse or panel doctor.

8.2.6.1

Employee must daily update company nurse on CD symptoms condition. Company nurse shall follow-up.

8.2.6.2

For the duration of quarantine, employee shall be considered as working from home. Reasonable amount of work related expenses incurred shall be reimbursed.

8.2.7

Suppliers, customers schedule to visit plant must get prior approval from Managing Director.

8.2.7.1

Document 9.2, Visitor Arrival Application Form must be filled by requesting department.

8.2.7.2

A copy shall be given to security personnel at guardhouse.

8.2.8

Local vendors and suppliers who are considered regulars are allowed to visit plant but have to undergo CD symptom checks at guardhouse including body temperature test and has to complete and sign Document 9.3, CD Status Recording Form.

8.2.8.1

If CD symptom test is negative, vendors and suppliers are allowed to enter lobby area.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.2.8.1.1

Jabil employee shall meet them in a special room identified for this purpose in the lobby.

8.2.8.1.2

Employees shall be issued with facemask when interacting with visitors.

8.2.8.1.3

Vendors, suppliers, visitors shall be advised to wear their own facemasks.

8.2.8.1.4

Visitors shall wear the facemask at all time whilst in the company premise. For those who don’t have facemask, security at guardhouse shall provide one.

8.2.8.1.5

Security must maintain a name list of all Jabil employees who comes in direct contact when meeting their customers, visitors, vendors and suppliers during their course of work.

8.2.8.2

If CD symptom turns out to be positive, they will not be allowed entry into plant and will be advised to go for further checks at government hospital.

8.2.8.2.1

Security will inform host department manager or delegate of situation.

8.2.8.2.2

Vendor, supplier name will be recorded for monitoring purpose in Document 9.6, Visitor CD Suspect Form.

8.2.8.2.3

Security shall ensure CD suspected visitors in record are not allowed into plant for the next 10 days.

8.2.8.3

Non-Jabil employees (e.g. Cafeteria staff and cleaners) shall undergo similar CD screening tests including body temperature measurement.

8.2.8.3.1

The daily testing and recording will be done by their respective supervisor using Document 9.4, CD Status Record Form-Non Jabil Employee and passed to company nurse/doctor.

8.2.8.3.2

Company nurse shall educate the area supervisors in the use of clinical thermometer and identifying of CD symptoms.

8.2.9

For emergency situations, HR manager shall have identified a temporary room in the plant for isolation purpose with all the basic set-up of a workcell cubicle.

8.2.10

Facility department shall be responsible for more frequent cleaning/sanitizing of enclosed areas and areas of heavy human traffic. e.g. Doors, Lift, Cafeteria, Clinic, Wash basins, Production floor, Badge readers, Door switch and others shall be increased.

8.2.11

More frequent cleaning/maintenance of air-conditioning units especially filters cleaning shall be increased.

8.2.12

No plant tours are allowed except with the discretion of the site Operation Manager.

8.2.13

All outstation travel and visit to other Jabil sites has to be approved by VP Operations for their respective regional sites.

8.2.14

VP Operations for respective region shall activate Condition Alert for affected sites.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.3

CONDITION ALERT (LEVEL TWO): CD is confirmed in one of Jabil’s sites.

(The following action plans shall be activated immediately if a case of CD is confirmed in one of Jabil’s locations.)

8.3.1

(The Managing Director and/or the Vice President of Operations will immediately notify Tom O’Connor the corporate liaison and inform him of where the case was confirmed, by whom and what corrective actions were taken to curtail other employees from ongoing exposure.)

8.3.2

Employees who are confirmed of CD must be sent to the state run or government hospital for a thorough medical check-up and quarantine.

8.3.3

Employees who work in the affected area and come in close or direct contact with the patient, are to be temporarily isolated in a special room identified in the plant before arrangements made to send the employee to the company panel clinic or government hospital for further checks and if necessary for quarantine.

8.3.4

Communications with all employees shall be done through emails and notice boards. Avoid discussion in groups.

8.3.5

All transfers or movements of employees between workstations, departments, shifts and inter plants shall be put on-hold.

8.3.6

Close down the affected area, be it a Bay, Workshop, Office area or a Section until further instructions from site Managing Director.

8.3.7

Assess all personnel working in the area and arrange medical tests for the individuals who could have come in close contact with the patient.

8.3.8

Seal off the affected area to minimize and control the possible spread of the CD virus.

8.3.9

All common use items that come in contact with employees must be cleaned often to prevent accumulation of CD virus.

8.3.10

The company nurse shall submit daily report on CD status to top management using Document 9.5, CD Management Reporting Form.

8.3.11

If required, request professional medical help to sterilize the entire area of contamination and any other suspected areas adjacent to it.

8.3.12

Sanitize the whole plant and its premises, internal and external, to exterminate the CD virus.

8.3.13

In order to minimize the impact on production, the affected area must be re-opened as soon as possible after seeking professional medical advices from the local health ministry.

8.3.14

Vendors, suppliers, visitors and customers are not allowed into plant and its premises.

8.3.15

Travel to other sites is not allowed and visit by all Jabil personnel is to be prohibited. Tom O’Connor, upon notification by the VP Operation Asia, Europe and Americas , or the infected region, will immediately notify corporate travel to restrict all travel to effected site.

8.3.16

VP Operations Asia, Europe and Americas shall activate Condition Alert for affected sites.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.4

CONDITION ALERT( LEVEL THREE): Death caused by CD

8.4.1

In the event if any employee has died from CD, a crisis committee must be established immediately with the MD of the affected site as lead person. The VP Operation of the region where a death occurred will be immediately notified of the employee’s death and will be responsible for communicating the circumstances associated with the death to the corporate liaison, Tom O’Connor. The information provided will include, but not being limited to: the employees name, time of death, location, how Jabil became aware of the employee’s illness and death, what department the employee worked in, how long the employee was with the company, are there other infected employees in the deceased work group etc.

8.4.2

Follow-up decisions and activities associated with the employee’s death will be coordinated by the Managing Director of the employee’s site in coordination with the Vice President of Operations of the employee’s region and will be communicated to Tom O’Connor accordingly.

8.4.3

All relevant authorities should be notified and action plans including local health government support has to in place to prevent further deaths from recurring.

8.5

COMMUNICATION

Tom O’Connor will coordinate all internal communications from the regions concerning the different levels of alerts with Jabil’s Communications Department Vice President , Beth Walters, along with any other CD activity relating to Jabil employees and facilities immediately upon receiving an advisory from the regions.

8.5.1.1

Latest global news regarding the outspread and development of CD shall be managed by Jabil Communication Department and must be first notified to corporate liaison, Tom O’Connor.

8.5.1.2

No site must provide information to news sources (television, newspapers, magazines, radio) in the event CD is detected in a Jabil plant.

8.5.1.3

All media calls should be directed to Lisa Allison (lisa_allison@jabil.com or 727-803-3314) in the Communications Department without comment.

8.5.1.4

Internal communication in the event of an outbreak should be limited to only those persons required. No worldwide messages or plant-wide messages should be sent without the consultation and review of Tom O’Connor and / or Communications Department, except when they include time-sensitive information critical to the health and safety of plant employees.

8.5.1.5

The Communications Department should review all pant wide communications concerning CD advisories.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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8.6

AUTHORITY

8.6.1

Tom O’Connor is the corporate liaison authority who will instruct Regional VP Operations and Regional HR Managers on all matters of CD.

8.6.2

Jabil sites and countries that fall under conditions Monitor and Alert Levels will be advised by Local Regional HR Manager or VP Operations of their respective regions as and when required.

9.0

DOCUMENTS

9.1

CD Symptom List


S/No		Symptom Types
1		Fever and Chills
2		Shortness of Breadth
3		Cough, Sore Throat, Blocked or Running Nose
4		Muscles and Joint Aches
5		Weakness and Fatique
6		High Fever of 38 Degrees Celsius and above that comes very suddenly.

9.2

Visitor Approval Form


Descriptions		Details
Name of Customer / Visitor Company
Number of Customers / Visitors
Customer / Visitors Name
Purpose of Visit
Date and Time of Visit
Jabil Contact Person
Dept Manager Signature
Managing Director Signature

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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9.3

Visitor Status Recording Form

No.

Visitor
Name

Company

Contact
Tel

Time

Body
Temperature

Last
Country
and Date
of Visit

Signature of
Visitor

Jabil
Contact
Person

Department

Contact
Tel

Signature

Remark

9.4

Daily Record Form -Non Jabil Employee

CONTAGIOUS DISEASE : DAILY SYMPTOM STATUS REPORT

(Non Jabil Employees)


Area
Date
Time
Supervisor


		Symptoms
S/No	Name of employee	Temp	Cough Sneezing	Block/ Running Nose	Others	Status	Supervisor Signature

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

9.5

CD : Management Reporting Form

CONTAGIOUS DISEASE : MANAGEMENT REPORTING FORM


SITE LOCATION :						Prepared by :
Date :


S/No	Name	Department	Title	Symptoms	Status

9.6

CD : Visitor Suspect Monitoring Form

VISITOR : CONTAGIOUS DISEASE SUSPECT RECORDING FORM

S/No

Name of Visitor

IC No

Company

Contagious

Disease

Suspect Date

Jabil Host

Name

Contact Number

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT F

Incoming Materials Quality Control Procedures

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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LOGO

EXHIBIT G

Form of Change Order Request

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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LOGO

EXHIBIT H

Form of Change Order Approval

Same form as Exhibit G.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT I

Form of Weekly Forecast/SDS Contract

SDS Report

Example of an SDS Report:


SDS Purchase Order:		112417		Item: 207200-002 - FRAME LOWER TLP 4”		Revision Lvl: C MCC : A


Supplier Item Text—JIT PART/26PER BX/25 BXS PER PLT/2PLTS PER RI		Buyer: VDS/BIN; Jolly

—Contact Planner : VDS/BIN; Jolly—		CLASS CODE 496 :PLASTIC INJECTION MOLDED

Dlv Week

Past Due

05-JAN-07

12-JAN-07

19-JAN-07

26-JAN-07

02-FEB-07

Item

QTY

207200-002

3,900

2,600


“02	03	04	05,06,07
QTY	QTY	QTY	QTY
7,800	13,000	11,700	24,700

**	*Balance Remaining for Month*


SDS Purchase Order Qty:	130,000	Balance Remaining:	1690
Last Receipt Date:	12-29-2006	Last Receipt Quantity:	650	Total Received (12-24-06 To 12-30-06)	1,950
Effective Date:	03-23-2006

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT J

[*** Redacted]

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT K

KPIs for Approved Warehouses

[To be provided upon implementation of a vendor managed inventory program]

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT L

Format for Tracking Cost Savings Initiatives

[*** Redacted]

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT M

Foreign Currency Calculation Method

a)	All references to “month” in this section shall be read as “calendar month.”

b)	The following details how certain currencies will be established:

Euro Based Currencies

The Euro outright forward contract rates are calculated as follows (i) spot rate against Euro as defined by the European Central Bank (www.ECB.int) as at the second to last Thursday of the month plus (ii) the average forward points for two (2) months as calculated by the difference between forward minus spot rate from the table “Euro Spot Forward Against the Euro” published by the Financial Times (“ FT ”) on the second to last Thursday of the month for the closing values of the second to last Wednesday of the month of WM/Reuters. The average rate is determined from the one (1) month and three (3) month forward rates divided by two based on the FT.

United States Dollar Based Currencies

Rates against United States Dollar are calculated as follows (i) spot rate against United States Dollar calculated through cross rate based on the rate as defined by the European Central Bank (www.ECB.int) as at the second to last Thursday of the month plus (ii) the average forward points for two (2) months as calculated by the difference between forward minus spot rate from the table “Dollar Spot Forward Against the Dollar” published by the FT on the second to last Thursday of the month for the closing values of the second to last Wednesday of the month of WM/Reuters. The average rate is determined from the one (1) month and three (3) month forward rates divided by two based on the FT.

Indian Rupee

Rates for Indian Rupees are calculated as follows (i) spot rate against United States Dollar or Euro as defined by the Reserve Bank of India (www.rbi.org.in) as at the second to last Thursday of the month plus (ii) average forward points for two (2) months as calculated by the difference between forward minus spot rate from the table “Dollar Spot Forward Against the Dollar” or “Euro Spot Forward Against the Euro”, respectively (as applicable), published by the FT on the second to last Thursday of the month for the closing values of the second to last Wednesday of the month of WM/Reuters. The average rate is determined from the one (1) month and three (3) month forward rates divided by two based on the FT.

Brazilian Real

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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The Brazilian Real is an exception. The forward rates will be as published on the second to last Thursday of the month by Bolsa de Mercadorias e Futuros (“ BMF ”) (www.bmf.com.br) for the referential rates of exchange of Brazilian Real against United States Dollar as at the second to last Wednesday of the month. The average rate is determined from the one (1) month, two (2) month and three (3) month forward rates divided by three based on the BMF rates

The spot for Brazilian Real, if necessary, will be calculated as the average between bid and offer rates as published by the Central Bank of Brazil (www.bcb.gov.br) for the closing rate for the exchange of Brazilian Real against United States Dollar as at the second to last Wednesday of the month.

Mexican Peso

The spot rate for Mexican Peso, if necessary, will be established as the Auction Exchange Rate as published by the Bank of Mexico (www.banxico.org.mx) for the Average closing rate for the exchange of Mexican Peso against the United States Dollar as at the second to last Wednesday of the month plus (ii) average forward points for two (2) months as calculated by the difference between forward minus spot rate from the table “Dollar Spot Forward Against the Dollar” or “Euro Spot Forward Against the Euro”, respectively (as applicable), published by the FT on the second to last Thursday of the month for the closing values of the second to last Wednesday of the month of WM/Reuters. The average rate is determined from the one (1) month and three (3) month forward rates divided by two based on the FT.

Malaysian Ringgit

Rates for Malaysian Ringgits are calculated as follows (i) spot rate against United States Dollar or Euro as the Latest Published Rate at 1600 HR published by the Bank of Negara Malaysia (www.bnm.gov.my) as at the second to last Thursday of the month plus (ii) average forward points for two (2) months as calculated by the difference between forward minus spot rate from the table “Dollar Spot Forward Against the Dollar” published by the FT on the second to last Thursday of the month for the closing values of the second to last Wednesday of the month of WM/Reuters. The average rate is determined from the one (1) month and three (3) month forward rates divided by two based on the FT. The Euro forward points will be calculated from the cross rates of United States Dollar and Euro forward rates.

Chinese Renminbi

Rates for the Chinese Renminbi will be determined via a mutually agreeable process until publicly available websites are able to provide both the spot and forward rates as applicable.

Other Currencies

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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For other currencies not defined above, a mutually agreed process of establishing such rates will be defined.

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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EXHIBIT N

[*** Redacted]

***	Confidential treatment requested pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. Omitted portions have been filed separately with the Securities and Exchange Commission.

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Exhibit 10.4

Nonqualified

Deferred Compensation Plan

Adoption Agreement

(including Code §409A Provisions)

The undersigned Zebra Technologies Corporation (“Employer”) by execution of this Adoption Agreement hereby establishes this Nonqualified Deferred Compensation Plan (“Plan”) consisting of the Basic Plan Document, this Adoption Agreement and all other Exhibits and documents to which they refer. The Employer makes the following elections concerning this Plan. All capitalized terms used in the Adoption Agreement have the same meaning given in the Basic Plan Document. References to “Section” followed by a number in this Adoption Agreement are references to the Basic Plan Document.

Preamble

ERISA/Code Plan Type : The Employer establishes this Plan as ( choose one of (a) or (b) ):

[X]

(a) Nonqualified Deferred Compensation Plan . An unfunded nonqualified deferred compensation plan which is ( choose only one of (i), (ii), (iii) or (iv) ):

[ ]

(i) Excess benefit plan. An “excess benefit plan” under ERISA§3(36) and exempt from Title I of ERISA.

[X]

(ii) Top-hat plan. A “SERP” or other plan primarily for a “select group of management or highly compensated employees” under ERISA and partially exempt from Title I of ERISA.

[ ]

(iii) Contractors only. A plan benefiting only Contractors (non-Employees) and exempt from Title I of ERISA.

[ ]

(iv) Church plan . A church plan as described in Code §414(e) and ERISA §3(33) and maintained by a church or church controlled organization under Code §3121(w)(3).

[ ]

(b) Ineligible 457 Plan . An ineligible 457 Plan subject to Code §457(f). The Employer is ( choose only one of (i), (ii) or (iii) ):

[ ]

(i) Governmental Plan. A State.

[ ]

(ii) Tax-Exempt Plan. A Tax-Exempt Organization. The Plan is intended to be a “top-hat” plan or an excess benefit plan as described in (a)(ii) and (a)(ii) above or the Plan benefits only Contractors.

[ ]

(iii) Church plan . A church plan as described in Code §414(e) and ERISA §3(33) but which is not maintained by a church or church controlled organization under Code §3121(w)(3).

Note: If the Employer elects (a)(i), the Plan benefits only Employees. If the Employer elects (a)(ii), the Plan generally may not benefit Contractors based on the “primarily” requirement. If the Employer elects (a)(iii), the Plan benefits only Contractors. If the Employer elects (a)(iv), (b)(i), or (b)(iii) the Plan may benefit Employees and Contractors. If the Employer elects (b)(ii), the plan is either a top-hat plan, an excess benefit plan or benefits only Contractors.

409A Plan Type: The Employer establishes this Plan ( choose one of (a) or (b) ):

[X] (a) Account Balance Plan. As the following type(s) of Account Balance Plan(s) under Section 1.02 ( choose one of (i), (ii) or (iii) ):

Nonqualified Deferred Compensation Plan

Adoption Agreement

[ ] (i) Elective Deferral Account Balance Plan . See Section 2.02.

[ ] (ii) Employer Contribution Account Balance Plan . See Sections 2.03 and 2.04.

[X] (iii) Both. Both an Elective Deferral Account Balance Plan and an Employer Contribution Account Balance Plan.

Note: For purposes of aggregation under Section 1.05, a Separation Pay Plan based only on Voluntary Separation from Service is treated as an Account Balance Plan. Nevertheless, if the Employer maintains this Plan as any type of Separation Pay Plan, the Employer should elect (b) below.

[ ] (b) Separation Pay Plan. As the following type(s) of Separation Pay Plan(s) under Section 1.42 ( choose one of (i) through (iv) ):

[ ] (i) Involuntary Separation .

[ ] (ii) Window Program .

[ ] (iii) Voluntary Separation .

[ ] (iv) Combination : ( specify )

Note: Under a Separation Pay Plan, the Employer must limit its payment election to Separation from Service or death. Electing death as a separate payment event would permit a different payment election for death versus any other Separation from Service. Separation from Service may also result from Disability.

Uniformity or Nonuniformity: The nonuniformity provisions described in the Preamble to the Basic Plan Document ( choose one of (a) or (b) ):

[ ] (a) Do not apply. All Adoption Agreement elections and Plan provisions apply to all Participants.

[X] (b) Apply . See Exhibit A to the Adoption Agreement.

Article I

Definitions

1.11 Change in Control. Change in Control means ( choose (a) or choose one of (b), (c) or (d) ):

[ ]

(a) Not applicable. Change in Control does not apply for purposes of this Plan.

[X]

(b) All events. Change in Control means all events under Section 1.11.

[ ]

(c) Limited events. Change in Control means only the following events under Section 1.11 ( choose one or two of (i), (ii) and (iii) ):

[ ]

(i) Change in ownership of the Employer.

[ ]

(ii) Change in the effective control of the Employer.

[ ]

(iii) Change in the ownership of a substantial portion of the Employer’s assets.

[ ]

(d) (Specify): .

Nonqualified Deferred Compensation Plan

Adoption Agreement

Note: The Employer may not use the blank in (d) to specify events not described in Treas. Reg. §1.409A-3(i)(5). However, the Employer may increase the percentages required to trigger a Change in Control under one or all three of the listed events.

1.15 Compensation. The Employer makes the following modifications to the “gross W-2” definition of Compensation ( choose (a) or at least one of (b) – (e) ):

[X]

(a) No modifications .

[ ]

(b) Net Compensation. Exclude all elective deferrals to other plans of the Employer described in Section 1.15.

[ ]

(d) Bonus only. Exclude all Compensation other than Bonus.

[ ]

(e) ( Specify ): .

Note: See Section 1.15(B) as to Contractor Compensation.

1.17 Disability. Disability means ( choose one of (a) or (b)) ):

[X]

(a) All impairments. All impairments constituting Disability.

[ ]

(b) Limited. Only the following impairments constituting Disability: .

1.20 Effective Date. The effective date of the Plan is ( choose one of (a) or (b) ):

[ ]

(a) New Plan. This Plan is a new Plan and is effective .

Note: The effective date should be no earlier than January 1, 2008.

[X]

(b) Restated Plan. This Plan is a restated Plan and is restated effective as of January 1, 2008. The Plan is restated to comply with Code §409A. The Plan was originally effective 1/1/2005.

Note:

If the Plan (whether or not in written form) was in effect before January 1, 2008, the Plan is a restated Plan.

1.38 Plan Name . The name of the Plan as adopted by the Employer is: Zebra Technologies Corporation 2005 Executive Deferred Compensation Plan.

1.39 Retirement Age. A Participant’s Retirement Age under the Plan is ( choose only one of (a)-(d) ):

[ ]

(a) Not applicable. Retirement Age does not apply for purposes of this Plan.

[X]

(b) Age. The Participant’s attainment of age: 55.

[ ]

(c) Age and service. The Participant’s attainment of age ____ with ____ Years of Service (defined under 1.57) with the Employer.

[ ]

(d) ( Specify ): .

1.40 Separation from Service. In determining whether a Participant has incurred a Separation from Service under the Plan ( choose one or both or (a) and (b) ):

Nonqualified Deferred Compensation Plan

Adoption Agreement

[X]	(a) Determination of “Employer.” In determining the “Employer” under Section 1.40(E) and Code §§414(b) and (c), apply the following percentage: 80% ( specify percentage ).

Note:

The specified percentage may not be more than 80% and may not be less than 20%. If the percentage is less than 50%, there must be legitimate business criteria.

[ ]	(b) Collectively Bargained Multiple Employer Plan. Under Section 1.40(H), the following reasonable definition of Separation from Service applies: ( specify ).

1.44 Specified Employees-Elections. The Employer makes the following elections relating to the determination of Specified Employees ( choose (a) or choose one or more of (b)-(e) ):

[ ]

(a) Not applicable. The Employer does not have any Specified Employees or none which benefit under the Plan.

[ ]

(b) Alternative Code §415 Compensation. The Employer elects the following alternative definition of Code §415 Compensation: ( specify ).

[ ]	(c) Alternative Specified Employee identification date. The Employer elects the following alternative Specified Employee identification date: ( specify ).

[ ]

(d) Alternative Specified Employee effective date. The Employer elects the following alternative Specified Employee effective date: ( specify ).

[X]

(e) Other elections. The Employer makes the following other elections relating to Specified Employees: Six (6) month Delay for all Distributions ( specify ).

Note:

See Treas. Reg. 1.409A-1(i)(8) as to uniformity requirements affecting the above Specified Employee elections.

1.51 Unforeseeable Emergency. Unforeseeable Emergency means (choose (a) or choose one of (b) or (c) ):

[ ]

(a) Not applicable. Unforeseeable Emergency does not apply for purposes of this Plan.

[X]

(b) All events. All events constituting Unforeseeable Emergency.

[ ]

1.56 Wraparound Election. The Plan ( choose one of (a) or (b) ) :

[ ]

(a) Permits. Permits Participants who participate in a 401(k) plan of the Employer to make Wraparound Elections.

[X]

(b) Not permitted. Does not permit Wraparound Elections (or the Employer does not maintain a 401(k) plan covering any Participants).

1.57 Year of Service. The following apply in determining credit for a Year of Service under the Plan ( choose (a) or choose one or more of (b) – (e) ):

Nonqualified Deferred Compensation Plan

Adoption Agreement

[ ]

(a) Not applicable. Year of Service does not apply for purposes of this Plan.

[X]

(b) Year of continuous service. To receive credit for one Year of Service, the Participant must remain in continuous employment with the Employer (or render contract service to the Employer) for the Participant’s entire Taxable Year.

[ ]

(c) Service on any day. To receive credit for one Year of Service, the Participant only need be employed by the Employer (or render contract service to the Employer) on any day of the Participant’s Taxable Year.

[ ]

(d) Pre-Plan service. The Employer will treat service before the Plan’s Effective Date for determining Years of Service as follows (choose one of (i) or (ii)) :

[ ]

(i) Include.

[ ]

(ii) Disregard.

[ ]

(e) (Specify) : .

Article II

Participation

2.01 Participant Designation. The Employer designates the following Employees or Contractors as Participants in the Plan ( choose one of (a), (b) or (c) ):

[ ]

(a) All top-hat Employees. All Employees whom the Employer from time to time designates in writing as part of a select group of management or highly compensated employees.

[ ]

(b) All Employees with maximum qualified plan additions or benefits. All Employees who have reached or will reach their limit under Code §§415(b) or (c) in the Employer’s qualified plan for the Taxable Year or for the 415 limitation year ending in the Taxable Year.

[X] (c) Specified Employees/Contractors by name, job title or classification: All non-Employee directors. Any Contractor (other than a non-Employee director) whom the Employer designates in writing as eligible for the Plan. Any Employee with a base salary at or above $150,000 per year (increased annually by the percentage increase in the Employer’s approved annual merit budget); provided that such Employee is part of a select group of management or highly compensated employees. Any Employee who was a Participant in the Plan on December 31, 2007. For this purpose, Employee shall mean “employee” of the Employer as defined in Basic Plan Section 1.23 provided that such an individual is on the Employer’s United States payroll. For this purpose, “Employer” shall include Zebra Technologies Corporation and any entity listed on Exhibit B hereto.

Note: An Employer might elect (c) and reference Exhibit B to maintain confidentiality within the workforce as to the identity of some or all Participants.

2.02 Elective Deferrals. Elective Deferrals by Participants are ( choose one of (a), (b) or (c) ):

[X]

(a) Permitted. Participants may make Elective Deferrals.

[ ]

(b) Not permitted. Participants may not make Elective Deferrals.

[ ]

Nonqualified Deferred Compensation Plan

Adoption Agreement

2.02(A) Amount limitation/conditions. A Participant’s Elective Deferrals for a Taxable Year are subject to the following amount limitation(s) or other conditions ( choose (a) or choose at least one of (b) – (d) ):

[ ]	(a) No limitation.

[X]

(b) Maximum Elective Deferral amount: 80% .

[ ]

(d) (Specify) : .

2.02(B) Election timing. A Participant must provide the Elective Deferral election under Section 2.02 to the Employer ( choose one of (a) or (b) ):

[X]

(a) By the deadline. No later than the applicable election deadline under Section 2.02(B).

[ ]

(b) Specified date. No later than days before the applicable election deadline under Section 2.02(B).

2.02(B)(6) Final payroll period. The Plan treats final payroll period Compensation under Section 2.02(B)(6) as ( choose one of (a) or (b) ):

[X]

(a) Current Year. As Compensation for the current Taxable Year in which the payroll period commenced.

[ ]

(b) Subsequent Year. As Compensation for the subsequent Taxable Year in which the Employer pays the Compensation.

2.02(C) Election changes/Irrevocability. A Participant who makes an Elective Deferral election before the applicable deadline under Section 2.02(B) ( choose one of (a) or (b) ):

[X]

(a) May change. May change the election until the applicable election deadline.

[ ]

(b) May not change. May not change the election as to the first Taxable Year to which the election applies.

Note: A payment election under Section 4.02(A) or (B) is a separate election which is not controlled by this Section 2.02(C). See Section 4.06(B).

2.02(D) Election duration. A Participant’s Elective Deferral election ( choose one of (a) or (b) ):

[ ]

(a) Taxable Year only. Applies only to the Participant’s Compensation for the Taxable Year for which the Participant makes the election.

[X]

(b) Continuing. Applies to the Participant’s Compensation for all Taxable Years, commencing with the Taxable Year for which the Participant makes the election, unless the Participant makes a new election or revokes or modifies an existing election.

2.03 Nonelective Contributions. During each Taxable Year the Employer will contribute a Nonelective Contribution for each Participant equal to ( choose (a) or (f) or choose one or more of (b) – (e) ):

[ ]

(a) None. The Employer will not make Nonelective Contributions to the Plan.

[ ]	(b) Fixed percentage. % of the Participant’s Compensation.

Nonqualified Deferred Compensation Plan

Adoption Agreement

[ ]

[X]

(d) Discretionary. Such Nonelective Contributions (or additional Nonelective Contributions) as the Employer may elect, including zero.

[ ]

(e) (Specify) : .

[ ]

(f) Frozen Nonelective Contributions. The Employer will not make any Nonelective Contributions as of: .

2.04 Matching Contributions. During each Taxable Year, the Employer will contribute a Matching Contribution equal to ( choose (a) or (i) or choose one or more of (b) – (h) ):

[ ]

(a) None. The Employer will not make Matching Contributions to the Plan.

[ ]

(b) Fixed match-flat. An amount equal to % of each Participant’s Elective Deferrals for each Taxable Year.

[ ]

(c) Fixed match-tiered. An amount equal to the following percentages for each specified level of a Participant’s Elective Deferrals or Years of Service for each Taxable Year:


Elective Deferrals				Matching Percentage
				%
				%
				%
				%

Note: Specify Elective Deferrals subject to match as a percentage of Compensation or a dollar amount.


Years of Service	Matching Percentage
		%
		%
		%
		%

[ ]

(d) No other caps. The Employer in applying the Matching Contribution formula under 2.04(b) or (c) above will not limit the Participant’s Elective Deferrals taken into account (except as indicated above) and otherwise will not limit the amount of the match.

[ ]

(e) Limit on Elective Deferrals matched. The Employer in making Matching Contributions will disregard a Participant’s Elective Deferrals exceeding ( specify percentage or dollar amount of Compensation ) for the Taxable Year.

[ ]

(f) Limit on matching amount. The Matching Contribution for any Participant for a Taxable Year may not exceed: (specify percentage or dollar amount of Compensation ) .

[X]

(g) Discretionary. Such Matching Contributions as the Employer may elect, including zero.

[ ]

(h) (Specify) : .

[ ]

(i) Frozen Matching Contributions. The Employer will not make any Matching Contributions as of: .

Nonqualified Deferred Compensation Plan

Adoption Agreement

2.05 Actual or Notional Contribution . The Employer’s Contributions will be ( choose one of (a) or (b) and choose (c) as applicable ):

[ ]

(a) Actual. Made in cash or property to Participant Accounts or to the Trust.

[ ]

(b) Notional. Credited to Participant Accounts only as a bookkeeping entry.

[X]

2.06 Allocation Conditions. To receive an allocation of Employer Contributions, a Participant must satisfy the following conditions during the Taxable Year ( choose (a) or choose one or both of (b) and (c) ):

[X]

(a) No allocation conditions.

[ ]

(b) Year of continuous service. The Participant must remain in continuous employment with the Employer (or render contract service to the Employer) for the entire Taxable Year.

[ ]

Article III

Vesting and Substantial Risk of Forfeiture

3.01 Vesting Schedule/Other Substantial Risk of Forfeiture. The following vesting schedule or other Substantial Risk of Forfeiture applies to a Participant’s Accrued Benefit ( choose (a) or choose one or more of (b) – (f) ):

[ ]

(a) Not applicable. The Plan does not apply a vesting schedule or other Substantial Risk of Forfeiture.

[ ]

(b) Immediate vesting. 100% Vested at all times with respect to the entire Accrued Benefit.

[X]

(c) Immediate vesting (Elective Deferrals)/vesting schedule (Employer Contributions) . A Participant’s Elective Deferral Account is 100% Vested at all times. A Participant’s Nonelective Contributions Account and Matching Contributions Account are subject to the following vesting schedule:


Years of Service		Vesting %
	or less	0	%
			%
			%
			%
	or more	100	%

[ ]

(d) Vesting schedule—entire Accrued Benefit. The Participant’s entire Accrued Benefit is subject to the following vesting schedule:


Years of Service		Vesting %
	or less	0	%
			%
			%
			%
			%
			%

Nonqualified Deferred Compensation Plan

Adoption Agreement


		or more		100	%

[ ]

(e) Vesting schedule – class year or all years. The Plan’s vesting schedule applies as follows ( Choose one of (i) or (ii) ):

[ ]

(i) Class year. Apply the vesting schedule separately to the Deferred Compensation for each Taxable Year.

[ ]

(ii) All years. Apply the vesting schedule to all Deferred Compensation based on all Years of Service.

[ ]	(f) Other Substantial Risk of Forfeiture. (Specify): .

Note: An Employer may elect both a vesting schedule and an additional Substantial Risk of Forfeiture. In such event, a Participant failing to satisfy the conditions resulting in a Substantial Risk of Forfeiture will forfeit his/her Account, even if 100% Vested under any vesting schedule. If the Plan is an Ineligible 457 Plan, the Employer must specify a Substantial Risk of Forfeiture, which may be a vesting schedule provided that under any “graded” vesting schedule, an Ineligible 457 Plan Participant will be taxed as and when each portion of his/her Deferred Compensation vests.

3.02 Immediate Vesting upon Specified Events. A Participant’s entire Accrued Benefit is 100% Vested without regard to Years of Service if the Participant’s Separation from Service with the Employer on or following or as a result of ( choose (a) or choose one or more of (b) – (e) ):

[ ]	(a) Not Applicable.

[ ]

(b) Retirement Age. On or following Retirement Age.

[X]

(d) Disability. As a result of Disability.

[ ]

(e) (Specify) : .

Note: An early vesting provision generally does not result in prohibited acceleration of benefits under Code §409A. See Section 4.03(C).

3.03 Application of Forfeitures. The Employer will ( choose only one of (a) – (d) ):

[ ]

(a) Not Applicable. Not apply any provision regarding allocation of forfeitures since there are no Plan forfeitures.

[X]

(b) Retain. Keep all forfeitures for the Employer’s account.

[ ]

(c) Allocate. Allocate (in the year in which the forfeiture occurs) any forfeiture to the Accounts of the remaining (nonforfeiting) Participants, in accordance with one of the following methods ( choose only one ):

[ ]

(i) Per Compensation. In the same ratio each Participant’s Compensation for the Taxable Year bears to the total Compensation of all Participants sharing in the forfeiture allocation for the Taxable Year.

[ ]

(ii) Per Account balances. In the same ratio each Participant’s Account balance at the beginning of the Taxable Year bears to the total Account balances of all Participants sharing in the forfeiture allocation for the Taxable Year.

Nonqualified Deferred Compensation Plan

Adoption Agreement

[ ]

(d) ( Specify ): .

Note: If the Employer elects to create the Trust under Section 5.03, the Employer should coordinate its forfeiture application elections with the provisions of the Trust.

Article IV

Benefit Payments

4.01 Payment Events/Elections. The Plan payment events are ( choose one or more of (a) through (i) as applicable ):

Note: The Employer must elect the Plan permitted payment events. The Employer may elect all of the 409A permitted events or limit the payment events, but the Employer must elect at least one payment event. If the Plan permits initial payment elections, change payment elections, or both, as to any or all of the Plan permitted payment events, the Employer should elect 4.01(d)(iv), (e)(ii) and (i) as applicable. The Employer also should elect under 4.02(A) and 4.02(B) as to who has election rights and to specify any limitations on such rights. If the Plan will not offer any initial or change payment elections, the Employer should not elect 4.01(d)(iv), (e)(ii) or (i). If the Plan will not offer any initial payment elections the Employer also should elect 4.02(A)(a). If the Plan will not offer change payment elections, the Employer also should elect 4.02(B)(a).

[X]	(a) Separation from Service.

[X]

(b) Death.

[X]

(d) Specified Time. The Plan permits payment to a Participant at a Specified Time ( choose one of (i)- (iv) ):

[ ]

(i) Forfeiture Lapse. At the time that the Deferred Compensation no longer is subject to a Substantial Risk of Forfeiture.

[ ]

(ii) Stated Age. Upon attainment of age: ( specify age ).

[ ]

(iii) ( Specify ): On: ( e.g ., January 1, 2015).

[X]

(iv) Election. In accordance with a Participant or Employer election under 4.02(A) or (B).

Note: The Employer must approve any Participant payment election. See Section 4.06. Payment at a Specified Time will be a lump-sum payment.

[ ]

(e) Fixed Schedule. The Plan Permits payment to a Participant in accordance with the following Fixed Schedule ( choose one of (i) or (ii) ):

[ ]

(i) Schedule: .

[ ]

(ii) Election. In accordance with a Participant or Employer election under 4.02(A) or (B).

Note: The Employer must approve any Participant payment election. See Section 4.06. Payment pursuant to a Fixed Schedule will be installments or an annuity commencing at a specific time.

Nonqualified Deferred Compensation Plan

Adoption Agreement

[X]

(f) Change in Control. The Plan permits payment to a Participant based on a Change in Control.

[X]

(g) Unforeseeable Emergency. The Plan permits payment to a Participant who has an Unforeseeable Emergency.

[ ]

(h) (Specify) : ( e.g., based on Unforeseeable Emergency, but only as the Elective Deferral Accounts).

Note: The Employer in (h) may modify any of (a)-(g) but only if such modifications are consistent with Code §409A.

[X]

(i) Election. As to 4.01 (a), (b), (c), (f), (g) and/or (h), in accordance with a Participant or Employer election under 4.02(A) or (B).

Note: The Employer must approve any Participant payment election. See Section 4.06.

4.01(E) Contractor deemed Separation from Service. In making any payment to a Contractor based on Separation from Service, the Plan ( choose (a) or choose one of (b) or (c) ):

[ ]

(a) Not applicable. \ Only Employees are Participants in the Plan.

[ ]

(b) Applies deemed Separation from Service. Applies the deemed Separation from Service provisions of Section 4.01(E).

[X]

4.02 Timing, Form and Medium of Payment/Elections. The Plan will pay a Participant’s Vested Accrued Benefit as follows ( complete (a), (b) and (c) ):

(a)

Timing. Payment will commence or be made ( choose only one of (i)—(vi) ):

[ ]

(i) 30 days. On a date which is 30 days following the payment event, unless otherwise made at a Specified Time or in accordance with a Fixed Schedule.

[ ]

(ii) 90 days . On a date which is within 90 days following the payment event, unless otherwise made at a Specified Time or in accordance with a Fixed Schedule.

Note: A Participant may not designate the Taxable Year of Payment under (a)(ii).

[ ]

(iii) 6 months. On a date that is 6 months following the payment event, unless otherwise made at a Specified Time or in accordance with a Fixed Schedule.

[ ]

(iv) Specified Time/Fixed Schedule. At the Specified Time under Section 4.01(d) or pursuant to the Fixed Schedule under Section 4.01(e).

[X]

(v) ( Specify ): First of the month following any payment event other than Separation from Service and the first of the seventh month following Separation from Service.

[ ]

(vi) Election. In accordance with a Participant or Employer election under Sections 4.02(A) or (B).

Note: The Employer must approve any Participant payment election. See Section 4.06(C).

Note: See Section 4.01(D) as to restrictions on timing of payments to Specified Employees.

Nonqualified Deferred Compensation Plan

Adoption Agreement

(b)

Form. The Plan will make payment in the form of ( choose one or more of (i) – (v) ):

[X]

(i) Lump-sum . A single payment.

[X]

(ii) Installments. In installments as follows: Five or Ten Years; provided the account balance equals or exceeds $50,000 on the date of the payment event.

[ ]

(iii) Annuity. An immediate annuity contract.

[ ]

(iv) ( Specify ) : .

[X]

(v) Election. In accordance with a Participant or Employer election under Sections 4.02(A) or (B).

Note: The Employer must approve any Participant payment election. See Section 4.06.

(c)

Medium. The form of payment will be ( choose only one of (i)—(iv) ):

[X]

(i) Cash only.

[ ]

(ii) Property only.

[ ]

(iii) Property or cash ( or both).

[ ]

(iv) Election. In accordance with a Participant or Employer election under 4.02(A) or (B).

Note: The Employer must approve all Participant payment elections. See Section 4.06.

Note: A choice between cash or property is not subject to Code §409A. See Treas. Reg. §1.409A-2(a)(1). The Plan treats this election as not being subject to the timing rules applicable to payment elections.

4.02(A) Initial payment elections. The Plan ( choose only one of (a)—(d) ):

[ ]

(a) No initial payment elections. The Plan and Adoption Agreement specify the payment events and the timing, form and medium of payment. If there are multiple payment events, the Plan will make payment based on the earliest event to occur except as follows: ( indicate no exceptions or specify sequencing ).

[X]

(b) Participant initial payment election. Permits a Participant initially to elect the payment event and the timing, form and medium of payment of his/her Deferred Compensation in accordance with Section 4.02(A) ( choose only one of (i) or (ii) ):

[X]

(i) All Accounts. The Plan applies a Participant’s elections to all of the Participant’s Accounts under the Plan.

[ ]

(ii) Elective Deferral Account. The Plan applies a Participant’s elections only to the Participant’s Elective Deferral Account. The Employer will make all payment elections as to Nonelective and Matching Contribution Accounts.

Note: A Participant must elect a payment event from those which the Employer has elected under 4.01 above, unless the Employer has permitted a Participant to elect the 409A permissible payment events. A Participant in his/her election form may limit the payment election to Compensation Deferred at the time of the election or also may apply the payment election to all future Deferred Compensation.

Nonqualified Deferred Compensation Plan

Adoption Agreement

[ ]

(c) Employer initial payment election . Permits the Employer (and not the Participant) initially to elect the payment events and the timing, form and medium of payment of all Participant Accounts in accordance with Section 4.02(A).

[ ]

(d) ( Specify ): ( e.g. , the Participant may make an election only as to the Participant’s Grandfathered Amounts).

Note: If a Participant or the Employer does not make an initial payment election, see Sections 4.01(B) and 4.02(A)(5).

4.02(B) Change payment elections. The Plan ( choose only one of (a) or (b); choose (c) if (b) applies and choose (d) if applicable) :

Note: Even if the Employer under 4.02(A)(a) elects not to permit any Participant or Employer initial payment elections, the Plan under Section 4.02(A)(1)treats a Plan designation of the payment events and of the timing, form and medium of payment as an initial election for purposes of applying any change election the Plan permits.

[ ]

(a) Change payment elections not permitted. Does not permit a Participant, a Beneficiary or the Employer to make a change payment election in accordance with Section 4.02(B).

[X]

(b) Permits change payment elections. Permits changes payment elections or changes to a change payment elections in accordance with Section 4.02(B) and as follows ( choose one or more of (i) -(iv) ):

[X]

(i) Participant election. Permits a Participant to make change payment elections.

[ ]

(ii) Employer election. Permits the Employer to make change payment elections.

[ ]

(iii) Beneficiary election. Permits a Beneficiary following the Participant’s death to make change payment elections.

[ ]

(iv) (Specify): ( e.g. , a Beneficiary may make a change payment election only if the Participant had the right to do so, OR a Participant may make a change payment election only after attaining age 60).

[X]

(c) Limit on number of change payment elections . The number of change payment elections (as to any initial payment election) that a Participant, a Beneficiary or the Employer (as applicable) may make is ( choose one of (i) or (ii) ):

[X]

(i) Unlimited. Not limited except as required under Section 4.02(B).

[ ]

(ii) Limited. Limited to: ( specify number ).

[ ]

(d) ( Specify ): ( e.g., permits change payment elections only as to Elective Deferral Account).

4.02(B)(3)(b) Installment payments. The Plan under Section 4.03(B)(3)(b) for purposes of application of the change payment election provisions treats an installment payment as a ( choose one of (a), (b) or (c) ):

[X]

(a) Single payment.

[ ]	(b) Series of payments.

[ ]

(c) Treatment for 2005 through 2007 . For the period spanning 2005 through 2007, treat installments as ( choose one of (i) or (ii) ):

Nonqualified Deferred Compensation Plan

Adoption Agreement

[ ]

(i) Single payment.

[ ]

(ii) Series of payments.

Note: If the Plan is a restated Plan, and the Employer otherwise before January 1, 2008, did not make a written designation regarding the treatment of installment payments, the Employer in (c) may elect to apply a different election for the period spanning 2005 through 2007, than applies after 2007 under (a) or (b). See Treas. Reg. 1.409A-2(b)(2)(iv).

[ ]

(d) Not applicable. The Plan does not permit installment payments.

4.06(B) Election changes/Irrevocability. A Participant who makes an initial payment election or a change payment election which the Employer has accepted ( complete (a) and (b) ):

(a)	Initial payment elections. ( choose one of (i), (ii) or (iii) ):

[X]

(i) May change. May change the initial payment election as to the Deferred Compensation to which the election applies, until the applicable election deadline under 4.02(A)(2)(a). Any change to an initial payment election made after the initial payment election becomes irrevocable is a change payment election.

[ ]

(ii) May not change. May not change the initial election as to the Deferred Compensation to which the election applies.

[ ]

(iii) Not applicable. As elected above, a Participant may not make an initial payment election.

(b)	Change payment elections. ( choose one of (i), (ii) or (iii) ):

[X]

(i) May change. May change the change payment election as to the Deferred Compensation to which the election applies. Where the payment event is a Specified Time or a Fixed Schedule, the Participant may change the election until the applicable deadline under Section 4.02(B)(1)(a). Where the change payment election relates to any other payment event (not a Specified Time or a Fixed Schedule), the Participant must make the change within 30 days following the Participant’s making of the change payment election which the Participant seeks to change. Any change to a change payment election made after the change payment election becomes irrevocable is a new change payment election.

[ ]

(ii) May not change. May not change the change payment election as to the Deferred Compensation to which the election applies.

[ ]

(iii) Not applicable. As elected above, a Participant may not make a change payment election.

Note: An Elective Deferral election under Section 2.02(C) is a separate election which is not controlled by this election 4.06(B).

Article V

Trust Election and Investments

5.02 No Trust. The Employer by electing (a) or (b) below does not create the Trust described in Section 5.03. Section 5.02 applies. The Employer will credit each Participant’s Account with ( choose one or both of (a) or (b) ):

[ X ]

(a) Actual Earnings ( choose only one of (i) through (iv) ):

Nonqualified Deferred Compensation Plan

Adoption Agreement

[ ]

(i) Employer direction. As a result of the Employer’s directed investment of the Account.

[X]

(ii) Participant direction. As a result of the Participant’s directed investment of his/her own Account.

[ ]

(iii) Participant direction over Elective Deferrals. As a result of the Participant’s directed investment of his/her own Elective Deferral Account, and the Employer’s directed investment of the balance of the Participant’s Account.

[ ]

(iv) ( Specify ): .

[ ]

(b) Notional Earnings. ( choose one or both of (i) or (ii) ):

[ ]

(i) Fixed/floating interest. Interest at the rate of and applied to (choose only one of (A), (B) or (C)) :

Note: use blank to specify rate, fixed or floating with index, time interval, simple or compounded interest, etc.

[ ]

(A) Total Account. The Participant’s entire Account.

[ ]

(B) Deferrals only. The Participant’s Elective Deferral Account, with the balance of the Account being subject to actual investment as specified in 5.02(a).

[ ]

(C) Employer Contribution only. The Participant’s Employer Contribution Accounts with the balance of the Account being subject to actual investment as specified in 5.02(a).

[ ] (ii) (Specify) : .

Nonqualified Deferred Compensation Plan

Adoption Agreement

5.03 Trust. The Employer by electing (a) or (b) below will establish the Trust described in Section 5.03 and designated as Exhibit C. The Trust will be identical in form to the Model Rabbi Trust issued by the Internal Revenue Service under Rev. Proc. 92-64 or any successor thereto. The Employer also may modify the Trust if necessary to comply with Applicable Guidance. The Employer will select among the optional and alternative features available under the Trust, and the Employer will not establish or adopt any other trust under the Plan. The version of the Trust the Employer adopts is ( choose one of (a) or (b) ):

[ ]	(a) Individually designed version .

[ ]	(b) Adoption agreement version.

Nonqualified Deferred Compensation Plan

Adoption Agreement

Employer Signature

The Employer hereby agrees to the provisions of this Plan, and in witness of its agreement, the Employer, by its duly authorized officer, has executed this Adoption Agreement on October 31, 2007.


Name of Employer:		Zebra Technologies

Employer’s EIN:		36-2675536

Signed:		/s/ Charles R. Whitchurch

Charles R. Whitchurch, CFO [Name/Title]

Nonqualified Deferred Compensation Plan

Adoption Agreement

Exhibit A

Special Provisions

[intentionally blank]

Nonqualified Deferred Compensation Plan

Adoption Agreement

Exhibit B

Participating Subsidiaries

ZIH Corporation

Zebra Atlantek Company

DDD, LLC

Wherenet Corp.

Wherenet Europe B.V.B.A.

Zebra Technologies International LLC

ZTI, UK LLC

Swecoin US Inc.

Zebra Technologies Asia Pacific, LLC

Zebra Technologies Asia Holding Ltd.

Genuine Zebra Technologies Trading Co., Ltd.

Zebra Technologies Latin America, LLC

Zebra Technologies Europe Limited

Zebra Technologies Service SP Zoo

Zebra Technologies Services SRL

Zebra Technologies B.V.

Zebra Technologies A.B.

Zebra Technologies Sp. Zoo

Swecoin AB

Zebra Technologies Brazil LLC

Zebra Technologies DO Brasil

Zebra Technologies Mexico, LLC

Zebra Technologies De Mexico, S DE RL DE

Proveo AG

Navis Holdings, LLC

Navis, LLC

Navis India Private Ltd.

Nonqualified

Deferred Compensation Plan

Basic Plan Document

(Including Code §409A provisions)

Nonqualified Deferred Compensation Prototype Plan

Nonqualified

Deferred Compensation Plan

Basic Plan Document

By execution of the Adoption Agreement associated with this Basic Plan Document, the Employer establishes this Nonqualified Deferred Compensation Plan (“Plan”) for the benefit of certain Employees and Contractors the Employer designates in its Adoption Agreement. The primary purpose of the Plan is to provide additional compensation to Participants upon termination of employment or service with the Employer. The Employer will pay benefits under the Plan only in accordance with the terms and conditions set forth in the Plan.

Preamble

ERISA/Code Plan Type. The Employer in its Adoption Agreement will specify whether it establishes the Plan as a nonqualified deferred compensation plan or as an ineligible Code §457(f) plan. A nonqualified deferred compensation plan is an unfunded plan that may be: (i) an “excess benefit plan” under ERISA §3(36); (ii) a plan maintained “primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees” (“top-hat plan”) under ERISA §§201(2), 301(a)(3) and 401(a)(1); (iii) a plan only for Contractors and exempt from Title I of ERISA; or (iv) a church plan under Code §414(e) and ERISA §3(33) and maintained by a church or church-controlled organization under Code §3121(w)(3). A top-hat plan includes a supplemental executive retirement plan (“SERP”). A tax-exempt Code §457(f) plan may include a church plan under Code §414(e) and ERISA §3(33) but which is not sponsored by a church or church-controlled organization under Code §3121(w)(3).

409A Plan Type. The Employer in its Adoption Agreement will specify whether it establishes the Plan as an Account Balance Plan or as a Separation Pay Plan.

Possible Nonuniformity. The Employer in its Adoption Agreement will specify such Plan terms as will apply to all Participants uniformly or as may apply to a given Participant. Except where the Plan or Applicable Guidance require uniformity in order to comply with Code §409A, the Employer need not provide the same Plan benefits or apply the same Plan terms and conditions to all Participants, even as to Participants who are of similar pay, title and other status with the Employer. The elections the Employer makes in its Adoption Agreement apply uniformly to all Participants, except to the extent the Employer adopts inconsistent provisions with respect to one or more Participants in a separate attachment designated as “Exhibit A” and attached to the Adoption Agreement. The Employer may create a separate Exhibit A for one or more Participants, specifying such terms and conditions as are applicable to a given Participant. The Employer, in Exhibit A, may modify any Plan provision or any Adoption Agreement election as to one or more Participants.

Definitions

“Account” means the account the Employer establishes under the Plan for each Participant and, as applicable, means a Participant’s Elective Deferral Account, Nonelective Contribution Account or Matching Contribution Account.

“Account Balance Plan” means an Elective Deferral Account Balance Plan or an Employer Contribution Account Balance Plan, or a combination of both, as the Employer elects in its Adoption Agreement.

Elective Deferral Account Balance Plan . An Elective Deferral Account Balance Plan is a plan comprised of an Elective Deferral Account as described under Treas. Reg. §1.409A-1(c)(2)(i)(A).

Employer Contribution Account Balance Plan . An Employer Contribution Account Balance Plan is a plan comprised of Employer Nonelective Contribution Accounts, Matching Contribution Accounts, or both, as described under Treas. Reg. §1.409A-1(c)(2)(i)(B).

“Accrued Benefit” means the total dollar amount credited to a Participant’s Account.


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“Adoption Agreement” means the document the Employer executes to establish the Plan and includes all Exhibits and other documents referenced therein.

“Aggregated Plans” means this Plan and any other like-type plan of the Employer in which a given Participant participates and as to which the Plan (see Sections 2.02(B)(2) and 6.03(B)) or Treas. Reg. §1.409A-1 (c)(2) requires the aggregation of all such nonqualified deferred compensation in applying Code §409A. For this purpose, the following rules apply:

Participants in Separate Plans . The plan for a Participant is treated as a separate plan from the plan for any other Participant, even though such plans may be incorporated into a single written plan in this Plan and covering all Participants.

Plan Types . The following plans under clauses (i), (ii) and (iii) are not “like-type plans” and are treated as separate from each other: (i) all Elective Deferral Account Balance Plans (including for aggregation purposes only, Separation Pay Plans based on Voluntary Separation from Service); (ii) all Employer Contribution Account Balance Plans (including for aggregation purposes only, Separation Pay Plans based on Voluntary Separation from Service); and (iii) all Separation Pay Plans based on Involuntary Separation from Service or under a Window Program.

Dual Status . If a Participant in two like-type plans participates in one plan as an Employee and in the other as a Contractor, the plans are not Aggregated Plans. If an Employee also serves on the Employer’s board of directors (or in a similar capacity with regard to a non-corporate entity) and participates in like-type plans but participates in one plan as an Employee and in the other as a director (or similar capacity with regard to a non-corporate entity) [a “director plan”], the plans are not Aggregated Plans provided that the director plan is substantially similar to a plan the maintains for non-employee directors. If the director plan is not substantially similar, for purposes of aggregation, the director plan is treated as a plan for Employees. Director plans and plans for Contractors are subject to aggregation under this Section 1.05.

“Applicable Guidance” means as the context requires Code §§83, 409A and 457, Treas. Reg. § 1.83, Treas. Reg. §§1.409A-1 through -6, Treas. Reg. § 1.457-11, or other written Treasury or IRS guidance regarding or affecting Code §§83, 409A or 457(f), including, as applicable, any Code §409A guidance in effect prior to January 1, 2008.

“Base Salary” means a Participant’s Compensation consisting only of regular salary and excluding any other Compensation.

“Basic Plan Document” means this Nonqualified Deferred Compensation Plan document.

“Beneficiary” means the person or persons entitled to receive Plan benefits in the event of a Participant’s death.

“Bonus” means a Participant’s Compensation consisting only of bonus and excluding any other Compensation. A Bonus also may be Performance-Based Compensation under Section 1.37.

“Change in Control” means, as to an Employer which is a corporation, a change: (i) in the ownership of the Employer (acquisition by one or more persons acting as a group of more than 50% of the total voting power or fair market value of the Employer); (ii) in the effective control of the Employer (acquisition or acquisition during a 12-month period ending on the date of the latest acquisition, by one or more persons acting as a group of 30% or more of the total voting power of the Employer or replacement of a majority of the members of the board of directors of the Employer [described below, but including only the entity for which no other corporation is a majority shareholder] during any 12-month period by directors not endorsed by a majority of the board before the appointment or election); or (iii) in the ownership of a substantial portion of the assets of the Employer (acquisition or acquisition during a 12-month period ending on the date of the latest acquisition, by one or more persons [other than related persons described in Treas. Reg. §1.409A-3(i)(5)(vii)(B)] acting as a group of assets with a total gross fair market value of 40% or more of the total gross fair market value of all assets of the Employer immediately

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before such acquisition or acquisitions), each within the meaning of Treas. Reg. §I .409A-3(i)(5) or in Applicable Guidance. For this purpose, the Employer includes the Employer, the corporation which is liable for the payment of the Deferred Compensation, a majority shareholder (more than 50% of total fair market value and voting power) of the foregoing or a corporation in a chain of corporations in which each is a majority owner of another corporation in the chain, ending in the Employer or in the corporation that is liable for payment of the Deferred Compensation, all in accordance with Treas. Reg. §1.409A-3(i)(5)(ii). An event constituting a Change in Control must be objectively determinable and any certification thereof by the Employer or its agents may not subject to the discretion of such person. For purposes of applying this Section 1.11, stock ownership is determined in accordance with Code §318(a) as modified under Treas. Reg. §1.409A-3(i)(5)(iii). The Employer in its Adoption Agreement will elect whether a Change in Control includes any or all the events described in clauses (i), (ii) or (iii) and also may elect to increase the percentage change required under any such event to constitute a Change in Control. Pending the issuance of Applicable Guidance as to the application of the Change in Control provisions to partnerships (or other non-corporate entities), if the Employer elects in its Adoption Agreement to permit Change in Control as a payment event, the Employer will apply clauses (i) and (iii) and clause (ii) as it relates to a change in the composition of the board of directors by analogy in accordance with Treas. Reg. §1.409A, Preamble, II.G.

“Change in the Employer’s Financial Health” means an adverse change in the Employer’s financial condition as described in Applicable Guidance.

“Code” means the Internal Revenue Code of 1986, as amended.

“Commissions” means Compensation or portions of Compensation consisting of Sales Commissions or of Investment Commissions. See Section 2.02(B)(5).

Sales Commissions . Sales Commissions means Compensation or portions of Compensation a Participant earns if: (i) a substantial portion of Participant’s services to the Employer consists of the direct sale of a product or a service to a customer that is not related or treated as related to the Employer or to the Participant (under Treas. Reg. §§1.409A-1(f)(2)(ii)) and (iv)); (ii) the Compensation the Employer pays to the Participant consists either of a portion of the purchase price for the product or service or of an amount substantially all of which is calculated by reference to volume of sales; and (iii) payment is either contingent upon the Employer receiving payment from an unrelated customer (as described in clause (i) above) for the product or services or, if consistently applied as to all similarly situated service providers, is contingent upon the closing of a sales transaction and such other requirements as the Employer may specify before the closing of the sales transaction.

Investment Commissions . Investment Commissions means Compensation or portions of Compensation a Participant earns if: (i) a substantial portion of the Participant’s services to the Employer to which the Compensation relates consists of sales of financial products or other direct customer services to a customer that is not related or treated as related to the Employer or to the Participant (under Treas. Reg. §§1.409A-1(f)(2)(ii)) and (iv)) as to customer assets or customer asset accounts; (ii) the customer retains the right to terminate the relationship and to move or liquidate the assets or asset accounts without undue delay (but subject to a reasonable notice period); (iii) the Compensation is based on a portion of the value of the overall assets or asset account balance, substantially all of the Compensation is calculated by reference to the increase in value of the overall assets of account balance, or both; and (iv) the value of the overall assets or account balance and Investment Commissions are determined at least annually.

Related Customer Commissions . This Section 1.14 also applies to Sales Commissions and to Investment Commissions involving a related customer provided: (i) the Employer as to unrelated customers makes substantial sales or provides substantial services giving rise to Commissions; and (ii) the sales, service and Commission arrangements with the related customer are bona fide, arise from the Employer’s ordinary course of business and are substantially the same, in terms and in practice, as those terms and practices that apply to unrelated customers to which substantial sales are made or substantial services are rendered.


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Nonqualified Deferred Compensation Prototype Plan

“Compensation”

Employees . Compensation means as to an Employee, gross W-2 compensation. “W-2 Compensation” means wages for federal income tax withholding purposes, as defined under Code §3401(a), plus all other payments to an Employee in the course of the Employer’s trade or business, for which the Employer must furnish the Employee a written statement under Code §§6041, 6051 and 6052, disregarding any rules limiting the remuneration included as wages under this definition based on the nature or location of the employment or service performed. “Gross W-2 compensation” means W-2 compensation plus all amounts excludible from a Participant’s gross income under Code §§125,132(0(4), 402(e)(3), 402(h)(2), 403(b), and 408(p), contributed by the Employer, at the Participant’s election, to a cafeteria plan, a qualified transportation fringe benefit plan, a 401(k) arrangement, a SEP, a tax sheltered annuity, or a SIMPLE plan.

Contractors . Compensation as to a Contractor means all payments by the Employer to the Contractor for services during a Taxable Year.

Modifications . The Employer in its Adoption Agreement will elect whether to modify the definition of Compensation. The Employer may modify the definition of Compensation or may specify a different definition of Compensation either as to Employees, as to Contractors or both.

“Contractor” means a person or entity providing services to the Employer (not as an Employee) as described in Treas. Reg. §1.409A-1(0(1) and which for any Taxable Year of the Contractor that the Contractor is on the cash receipts and disbursements method of accounting for Federal income tax purposes. A person serving on a board of directors is a Contractor as to Compensation for such service without regard to whether the person is an Employee for other purposes. A Contractor is not subject to this Plan or to Code §409A if in the Taxable Year in which the Legally Binding Right to Compensation arises: (i) the Contractor is actively engaged in the trade or business of performing services other than as an Employee or as a director (or similar position as to a non-corporate Employer); (ii) the Contractor provides significant services to the Employer and to at least 2 other unrelated service recipients, where the Contractor, the Employer and the other service recipient(s) are all unrelated to each other within the meaning of Treas. Reg. §§1.409A-1(f)(2)(i)(B) and (C) as applicable; and (iii) the services are not “management services” within the meaning of Treas. Reg. §1.409A-1(0(2)(iv). For purposes of clause (ii) “significant services” means as described in Treas. Reg. §1.409A-1(0(2)(iii). This Plan and Code §409A also do not apply to certain other “related” Contractor services as described in Treas. Reg. §1.409A-1(0(2)(v).

“Disability” except as the Plan otherwise provides means a condition of a Participant who by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months: (i) is unable to engage in any substantial gainful activity; or (ii) is receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering Employees. The Employer in its Adoption Agreement will elect whether Disability includes all impairments constituting Disability under this Section 1.17, or only certain specified Disabilities which satisfy the foregoing definition. The Employer will determine whether a Participant has incurred a Disability based on its own good faith determination and may require a Participant to submit to reasonable physical and mental examinations for this purpose. A Participant will be deemed to have incurred a Disability if: (i) the Social Security Administration or Railroad Retirement Board determines that the Participant is totally disabled; or (ii) the applicable insurance company providing disability insurance to the Participant under an Employer sponsored disability program determines that a Participant is disabled under the insurance contract definition of disability, provided such definition complies with the definition in this Section 1.17.

“Deferred Compensation” means the Participant’s Account Balance attributable to Elective Deferrals and Employer Contributions and includes Earnings on such amounts except where the Plan otherwise provides. “Compensation Deferred” is Compensation that the Participant or the Employer has deferred under this Plan. Compensation is Deferred Compensation if: (i) under the terms of the Plan and the relevant facts and circumstances, the Participant has a Legally Binding Right to Compensation during a Taxable Year that the Participant has not actually or constructively received and included in gross income; and (ii) pursuant to the Plan

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terms, the Compensation is or may be payable to or on behalf of the Participant in a later Taxable Year. Deferred Compensation includes Separation Pay paid pursuant to a Separation Pay Plan except as otherwise described in Treas. Reg. §1.409A-1(b)(9) relating to certain excluded Involuntary or Voluntary Separation from Service or Window Programs and certain reimbursements, medical benefits, in-kind benefits and limited payments. Deferred Compensation excludes certain “short-term deferrals” and all other items described in Treas. Reg. §§1.409A-1(b)(3), (4), (5), (6), (8), (10), (11) and (12) or in other Applicable Guidance.

“Earnings” means earnings, gain or loss applicable to a Participant’s Account provided that such amounts reflect actual predetermined investments or notional amounts which do not exceed a reasonable rate of interest. Amounts credited to an Account that do not reflect actual predetermined investments or a reasonable rate of interest are Deferred Compensation and are not Earnings. For purposes of making the determination of whether an amount is Earnings or is Deferred Compensation, the principles of Treas. Reg. §31.3121(v)(2)-1(d)(2) apply.

“Effective Date” of the Plan is the date the Employer specifies in the Adoption Agreement, but which is not earlier than January 1, 2008. If this Plan restates a Plan (written or otherwise) which was in effect before January 1, 2008, for periods before January 1, 2008, as to 409A Amounts, the standards and transition rules in effect under Notices 2006-79, 2006-64, 2003-33, 2006-4, Prop. Treas. Reg. §1.409A, Preamble, Section XI and Notice 2005-1 apply. See also the Treas. Reg. §1.409A Preamble, Section XII as to the treatment of certain actions which were in compliance with Applicable Guidance in effect before the issuance of such 409A Regulations on April 17, 2007, but which are not in compliance with such Regulations.

“Elective Deferral” means Compensation a Participant elects to defer into the Participant’s Account under the Plan.

“Elective Deferral Account” means the portion of a Participant’s Account attributable to Elective Deferrals and Earnings thereon.

“Employee” means a person providing services to the Employer as a common law employee (and not as a Contractor) as described in Treas. Reg. §1.409A-1(f)(1) and who, for any Taxable Year of the Employee, is on the cash receipts and disbursements method of accounting for Federal income tax purposes.

“Employer” means the person or entity: (i) receiving the services of the Participant (even if another person pays the Deferred Compensation); (ii) with respect to whom the Legally Binding Right to Compensation arises; and (iii) who or which executes an Adoption Agreement establishing the Plan. The Employer includes all persons with whom the Employer would be considered a single employer under Code §§414(b) or (c). In the case of an Ineligible 457 Plan, Employer means a State or a Tax-Exempt Organization. For purposes of this Plan, “Employer” means “service recipient” as that term in used in Treas. Reg. §1.409A1 through -6.

“Employer Contribution” means amounts the Employer contributes or credits to an Account under the Plan, including Nonelective Contributions and Matching Contributions but not including Elective Deferrals.

“Employer Contribution Account” means the portion of a Participant’s Account attributable to Employer Contributions and Earnings thereon.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“409A Amount” means: (i) any Compensation Deferred prior to January 1, 2005, unless such Deferred Compensation is a Grandfathered Amount; and (ii) any Compensation Deferred in Taxable Years beginning after December 31, 2004. In determining 409A Amounts, the rules of Section 1.05 regarding Aggregated Plans apply.

“Grandfathered Amount” means an amount of Deferred Compensation hereunder as to which, prior to January 1, 2005, a Participant: (i) had a Legally Binding Right to be paid Deferred Compensation; and (ii) was Vested. However, if the Employer after October 3, 2004, materially modifies the Plan as described in Treas. Reg.


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Nonqualified Deferred Compensation Prototype Plan

1.409A-6(a)(4), then such amount ceases to be a Grandfathered Amount. In determining Grandfathered Amounts, the rules of Section 1.05 regarding Aggregated Plans apply.

“Ineligible 457 Plan” means this Plan which is subject to Code §457(f) and that is not an eligible 457 plan under Code §457(b).

“Legally Binding Right” means, in reference to Compensation, the grant by the Employer to the Participant of an enforceable right (under contract, statute or other applicable law) to Compensation where, after the Participant has performed the services which created the Legally Binding Right, the Compensation is not subject to unilateral reduction or elimination by the Employer or any other person. The Employer, based on the facts and circumstances and in accordance with Treas. Reg. §1.409A-I (b)(1), will determine: (i) whether a Legally Binding Right exists; or (ii) whether a Legally Binding Right does not exist on account of the existence of negative discretion which has substantive significance to reduce or eliminate the Compensation. Negative discretion does not exist where the Participant has effective control over the person with the negative discretion, has effective control over any portion of compensation of the decision maker or is a family member of the decision maker (within the meaning of Code §267(c)(4) applied as if the family of an individual includes the spouse of any member of the family). Compensation is not subject to unilateral reduction or elimination merely because: (i) it may be reduced or eliminated by operation of objective Plan terms, such as a Substantial Risk of Forfeiture; (ii) the Compensation is determined under a formula that provides for an offset based on benefits provided under another plan, including a qualified plan; or (iii) benefits are reduced on account of actual or notional investment losses, or, in a final average pay plan, because of subsequent decreases in compensation.

“Matching Contribution” means a fixed or discretionary Employer contribution made with respect to a Participant’s Elective Deferral.

“Matching Contribution Account” means the portion of a Participant’s Account attributable to Matching Contributions and Earnings thereon.

“Nonelective Contribution” means a fixed or discretionary Employer Contribution that is unrelated to a Participant’s Elective Deferrals.

“Nonelective Contribution Account” means the portion of a Participant’s Account attributable to Nonelective Contributions and Earnings thereon.

“Participant” means an Employee or Contractor the Employer designates under Adoption Agreement Section 2.01 or in Exhibit “B” to the Adoption Agreement to participate in the Plan. For purposes of this Plan, “Participant” means a “service provider” as that term in used in Treas. Reg. 1.409A-1 through-6, who is a participant in the Plan. A reference herein to “service provider” means another service provider to the Employer, whether or not that person is a Participant.

“Performance-Based Compensation” means Compensation (including a Bonus) where the amount of, or entitlement to, the Compensation is contingent on satisfaction of preestablished organizational or individual performance criteria relating to a performance period of at least 12 consecutive months. The Employer must establish the organizational or individual performance criteria in writing not later than 90 days after commencement of the performance period and the outcome must be substantially uncertain at the time that the Employer establishes the performance criteria. The Employer may establish performance criteria without the necessity of action by its shareholders, board of directors, compensation committee or similar entities in the case of a non-corporate Employer. Performance-Based Compensation does not include any amount that will be paid regardless of performance or that will be paid based on a level of performance that is substantially certain to be met at the time the criteria are established. If the Plan will pay the Participant’s Performance-Based Compensation in the event of the Participant’s death or disability or if a Change in Control occurs, without regard to whether the performance criteria have been satisfied, the Compensation is not Performance-Based Compensation (and therefore is not entitled to the election timing under Section 2.02(B)(4)) if payment occurs as a result of any of such events. “Disability” for purposes of this Section 1.37 means any medically determinable physical or mental impairment resulting form the


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Nonqualified Deferred Compensation Plan

Adoption Agreement

Participant’s inability to perform the duties of his/her position or of any substantially similar position, where such impairment can be expected to result in death or to last for a continuous period of not less than 6 months. Performance-Based Compensation does not include an amount of Compensation which is based on a specified number of shares of stock multiplied by the share price at the end of the performance period, but may include an amount of Compensation based on an increase in share price over the performance period or which is not payable unless the share price is at or above a specified price. Performance-Based Compensation may be based on subjective performance criteria provided: (i) the criteria are bona fide and relate the Participant’s performance, a group of service providers that includes the Participant or a business unit for which the Participant provides services which may include the Employer; and (ii) the person who decides whether the subjective performance criteria have been met is someone other than the Participant, the Participant’s family member (within the meaning of Code §267(c)(4) applied as if the family of an individual includes the spouse of any member of the family), or a person under the effective control of the Participant or such a family member. In addition, the decision maker’s compensation may not be controlled in whole or in part by the Participant or such a family member. The Employer will determine the status of Compensation as Performance-Based Compensation in accordance with Treas. Reg. §1.409A-1(e) and Applicable Guidance.

“Plan” means the Nonqualified Deferred Compensation Plan of the Employer established by and including the Adoption Agreement, the Basic Plan Document, the Trust, if any, and all notices, forms, elections and other written documentation to which the Plan refers. The Employer will set forth the name of the Plan in its Adoption Agreement. For purposes of applying Code §409A requirements this Plan, as the Employer elects in its Adoption Agreement, is an Elective Deferral Account Balance Plan, an Employer Contribution Account Balance Plan or both, or is a Separation Pay Plan. This Plan does not constitute: (i) a Code §401(a) plan with and exempt trust under Code §501(a); (ii) a Code §403(a) annuity plan; (iii) a Code §403(b) annuity; (iv) a Code §408(k) SEP; (v) a Code §408(p) Simple IRA; (vi) a Code §501(c)(18) trust to which an active participant makes deductible contributions; (vii) a Code §457(b) plan; or (viii) a Code §415(m) plan.

“Retirement Age” means the date (if any) the Employer elects in the Adoption Agreement.

“Separation from Service”

Employees . Separation from Service means in the case of an Employee, the Employee’s termination of employment with the Employer whether on account of death, retirement, Disability or otherwise.

Insignificant or Significant Service/Presumptions . The Employer will determine whether an Employee has terminated employment (and incurred a Separation from Service) based on whether the facts and circumstances as described in Treas. Reg. §1.409A-1(h)(1)(ii). An Employee incurs a Separation from Service if the parties reasonably anticipate, based on the facts and circumstances, the Employee will not perform any additional services after a certain date or that the level of bona fide services (whether performed as an Employee or as a Contractor) will permanently decrease to no more than 20% of the average level of bona fide services performed (whether performed as an Employee or as a Contractor) over the immediately preceding 36-month period (or, if less, the period the employee has rendered service to the Employer) (“average prior service”). An Employee is presumed to have incurred a Separation from Service if the Employee’s service level decreases to 20% or less than the average prior service and an Employee is presumed to not have incurred a Separation from Service if the Employee’s service level continues at a rate which is 50% or more of the average prior service. No presumption applies where the Employee’s service level is more than 20% and less than 50% of the average prior service.

Effect of Leave . An Employee does not incur a Separation from Service if the Employee is on military leave, sick leave, or other bona fide leave of absence if such leave does not exceed a period of 6 months, or if longer, the period for which a statute or contract provides the Employee with the right to reemployment with the Employer. If a Participant’s leave exceeds 6 months but the Participant is not entitled to reemployment under a statute or contract, the Participant incurs a Separation from Service on the next day following the expiration of 6 months. A leave of absence constitutes a bona fide leave of absence for this Section 1.40 only if there is a reasonable expectation that the Employee will return to perform services for the Employer. Where a leave of absence is due to any medically determinable physical or mental impairment that can be expected to result in death or to last for a

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continuous period of at least 6 months, and where the Participant cannot perform his/her duties or the duties of any substantially similar position, in determining when a Separation from Service occurs, the above 6 month period is 29 months unless the Employer or the Employee terminate the leave sooner. For purposes of determining average prior service under Section 1.40 (A)(1), during a paid leave of absence which is not a Separation From Service, the Employee is treated as rendering bona fide services at a level that would have been required to earn the amount paid during the leave. If the leave of absence is unpaid, the leave period is disregarded in determining average prior service.

Alternative Definition . In lieu of applying Section 1.40(A)(1), the Employer or Participant in an initial payment election or in a change payment election may elect a percentage of reduced bona fide services resulting in a Separation from Service which percentage must be greater than 20% and less than 50% of prior average service, determined over the immediately preceding 36 months.

Contractors . Separation from Service, in the case of a Contractor, means the expiration of the contract (or all contracts) under which the Contractor performs services for the Employer provided that the expiration constitutes a good-faith and complete termination of the contractual relationship between the Contractor and the Employer. A good-faith and complete termination does not occur if the Employer anticipates a renewal of the service contract or the Employer anticipates the Contractor becoming an Employee. The Employer anticipates the renewal of the contract if the Employer intends to contract again for the services provided under the expired contract and neither the Employer nor the Contractor has eliminated the Contractor as a possible provider of such additional services. The Employer is deemed to intend renewal of the Contractor’s expired contract if renewal is conditioned only upon incurring a need for services, the Employer’s ability to pay for the services, or both. See Section 4.01(E) as to Contractor “deemed” Separation from Service provisions.

Involuntary Separation from Service (including for “good reason”) . “Involuntary Separation from Service” means a Separation from Service due to the Employer’s independent exercise of unilateral authority to terminate the Participant’s services (other than due the Participant’s implicit or explicit request), where the Participant was willing and able to continue performing services for the Employer. Involuntary Separation from Service may include the Employer’s failure to renew the service contract at the time the contract expires provided that the Participant was willing and able to execute a new contract on substantially the same terms and conditions as the expiring contract and to continue providing such services. The Employer will make the determination as to whether an Involuntary Separation from Service has occurred based on all of the facts and circumstances and in accordance with Treas. Reg. §1.409A-1(n). For this purpose, a Participant’s voluntary Separation from Service is treated as an Involuntary Separation from Service if it is for “good reason” as described in Treas. Reg. §§1.409A-1(n)(2). For this purpose, the Separation from Service is deemed to be for a good reason if it occurs during a limited period not to exceed 2 years following the initial existence of the following without the Participant’s: consent (i) a material reduction in the Participant’s base compensation (including Base Salary); (ii) a material reduction in the Participant’s authority, duties or responsibilities; (iii) a material reduction in the authority, duties or responsibilities of the Participant’s supervisor, including a change in the Participant’s reporting responsibilities to a lower level than the board of directors or similar authority in a non-corporate entity; (iv) a material reduction in the Participant’s budget; (v) a material change in the location at which the Participant renders service; or (vi) any other action or inaction that constitutes the Employer’s material breach of the agreement under which the Participant provides services to the Employer. In addition, to be a deemed “good reason” the amount, time and form of payment upon Separation from Service must be substantially identical to the amount payable upon an actual Involuntary Separation from Service, if such right exists, and the Participant must provide notice to the Employer within 90 days of the initial existence of the condition and afford the Employer at least 30 days to remedy the condition without having to pay the Compensation.

Voluntary Separation from Service . “Voluntary Separation from Service” means a Separation from Service which is not an Involuntary Separation from Service under Section 1.40(C).

“Employer” for Purposes of Separation Rules . The “Employer” for purposes of applying this Section 1.40 (determining Separation from Service under the Plan) means as defined under Section 1.24 but by applying 50% in lieu of 80% in applying Code §§414(b) and (c). The Employer in lieu of applying the previous sentence may elect in its Adoption Agreement to use a percentage equal to not less than 20% and not more than 80% in

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determining related employers under Code §§414(b) and (c); provided that the Employer may not elect to apply a percentage which is less than 50% unless there are legitimate business criteria for doing so.

Dual Capacity . If a Participant renders service to the Employer both in the capacity as an Employee and as a Contractor (or changes status from Employee to Contractor or vice versa), the Participant must incur a Separation from Service in both capacities to constitute a Separation from Service. For this purpose, if a Participant renders service both as an Employee and as a member of the Employer’s board of directors (or an analogous position in the case of a non-corporate Employer) the director services (or the Employee services if this Plan relates to director services) are disregarded in determining whether the Participant has incurred a Separation from Service as to this Plan provided that the plans are not Aggregated Plans.

Certain Asset Sales . In accordance with and subject to Treas. Reg. §1.409A-1(h)(4), if the Employer sells its assets to an unrelated party purchaser where the Participants otherwise would incur a Separation from Service and where such Participants will provide services to the purchaser after the sale closing, the Employer and the purchaser retain discretion no later than the asset sale closing date to specify in writing whether the Participants will incur a Separation from Service. In making such determination, the Employer and the purchaser must treat all affected Participants consistently.

Collectively Bargained Multiple Employer Plan . If the Plan is established pursuant to a bona fide collective bargaining agreement covering services rendered for multiple employers, the Employer (which for this purpose means the employer which executes the Adoption Agreement) in its Adoption Agreement may elect to define Separation from Service in a reasonable manner that treats an Employee as not having separated during periods in which the Employee is not providing services but is available to do so for one or more employers. However, such alternative definition must also provide that the Employee is deemed to have incurred a Separation from Service at a specified date not later than the end of any period of at least 12 consecutive months during which time the Employee has not provided any service covered by the collective bargaining agreement to any participating employer. The Employer will apply this section in accordance with the requirements of Treas. Reg. §1.409A-1(h)(6).

“Separation Pay” means any Deferred Compensation (applied before application of any exclusion applicable to Separation Pay Plans under Treas. Reg. §1.409A-1(b)(9)) that will not be paid under any circumstances unless the Participant incurs a Separation from Service, whether voluntary or involuntary, including payments in the form of reimbursements for expenses incurred and provision of in-kind benefits. Deferred Compensation that a Participant may receive without incurring a Separation from Service is not Separation Pay merely because the Participant elects to receive or receives payment upon or after Separation from Service. Deferred Compensation does not fail to constitute Separation Pay merely because the Participant must execute a release of claims, noncompetition agreement or nondisclosure agreement or is subject to similar requirements. Any amount or entitlement that acts as a substitute for, or replacement of, Deferred Compensation is a payment of Deferred Compensation and is not Separation Pay.

“Separation Pay Plan” means any plan that provides for Separation Pay, including the portion of any plan that provides for Separation Pay, under Treas. Reg. §§1.409A-1(m). The Employer in its Adoption Agreement will elect whether this Plan is a Separation Pay Plan and will elect whether the plan pays benefits in the event of Involuntary Separation from Service, Voluntary Separation from Service, pursuant to a Window Program or a combination thereof.

“Service Year” means a Participant’s Taxable Year in which the Participant performs services which give rise to Compensation. A “service period” or “performance period” means a Service Year or such other period in which a Participant performs services for the Employer giving rise to Compensation.

“Specified Employee” means a Participant who is a key employee as described in Code §416(i)(1)(A), disregarding paragraph (5) thereof and using compensation as defined under Treas. Reg. §1.415(c)-2(a). However, a Participant is not a Specified Employee unless any stock of the Employer is publicly traded on an established securities market or otherwise and the Participant is a Specified Employee on the date of his/her Separation from

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Nonqualified Deferred Compensation Plan

Adoption Agreement

Service. If a Participant is a key employee at any time during the 12 months ending on the Specified Employee identification date, the Participant is a Specified Employee for the 12 month period commencing on the Specified Employee effective date. The Specified Employee identification date is December 31. The Specified Employee effective date is the April 1 following the Specified Employee identification date. The Employer, in determining whether this Section 1.44 and all related Plan provisions apply, will determine whether the Employer has any publicly traded stock as of the date of a Participant’s Separation from Service. In the case of certain corporate transactions (a merger, acquisition, spin-off or initial public offering), or in the case of nonresident alien Employees, the Employer will apply the Specified Employee provisions of the Plan in accordance with Treas. Reg. §1.409A-1(i) and other Applicable Guidance. Notwithstanding the foregoing, the Employer in its Adoption Agreement, and in accordance with Treas. Reg. §1.409A-1(i) and other Applicable Guidance, may make the following elections: (i) use of any Code §415 definition of compensation for Specified Employee determination; (ii) designation of an alternative Specified Employee identification date; (iii) designation of an alternative Specified Employee effective date; (iv) use of an alternative method to identify Participants who will be subject to the 6 month delay rule in Section 4.01(D); (v) certain elections in the context of corporate transactions; and (vi) certain elections regarding nonresident alien Employees. The Employer’s election under clauses (ii) or (iii) regarding an identification date or effective date made on or before December 31, 2007, applies to any Separation from Service occurring on or after January 1, 2005, unless the Employer subsequently changes the identification date and/or effective date. Such elections are effective as of the date that all necessary corporate action has been taken to make the election binding as to all nonqualified deferred compensation plans in which service providers of the Employer who would become a Specified Employees participate. The Employer must apply all such elections consistently as to all service providers. The Employer will apply the Specified Employee provisions of the Plan, including the elections described in this Section 1.44, in accordance with Treas. Reg. §1.409A-1(i) and other Applicable Guidance.

“Specified Time or Fixed Schedule” means, in reference to a payment of Deferred Compensation, the Employer, at the time of the deferral of the Compensation can objectively determine: (i) the amount payable; and (ii) the payment date or dates. An amount is objectively determinable if the deferral election specifically identifies the amount or if the Employer can determine the amount at the time it is due pursuant to an objective, nondiscretionary formula specified at the time of deferral.

Dates and Period(s) . A payment is scheduled to occur at a specified time if it is a lump sum payment on a specific date, or a specific, objectively determinable date, including following the lapse of a substantial risk of forfeiture. A payment is scheduled to occur on a fixed schedule if it is a series of payments (which may include an annuity or a series of installments) payable on specific dates or on specifically, objectively determinable dates including following the lapse of a substantial risk of forfeiture. The designation of a Taxable Year of the Participant, or a defined period within a Taxable Year of the Participant, in which payment will occur is adequate designation of a specific date. For purposes of Sections 4.02 and 4.05, if the date specified is only a designated Taxable Year of the Participant, or a period of time during such a Taxable Year, the date specified under the plan is treated as the first day of such Taxable Year or the first day of the period of time, as applicable.

Limitations and Link to Employer Receipts . A Fixed Schedule may include certain: (i) limitations on the amount payable at a specified time of during a specified period expressed either as a stated limit or based on an objective nondiscretionary formula; and (ii) payment schedules based on the timing of payments received by the Employer as described in Treas. Reg. §§1.409A-3(i)(1)(ii) and (iii) and other Applicable Guidance.

Tax Gross-Up Payments . A Specified Time or Fixed Schedule may include tax gross-up payments made by the end of the Participant’s Taxable Year which follows the Taxable Year in which the Participant remits the related taxes resulting from compensation paid or made available to the Participant by the Employer, as described in Treas. Reg. §1.409A-3(i)(1)(v) and other Applicable Guidance.

“State” means: (i) one of the fifty states of the United States or the District of Columbia, or (ii) a political subdivision of a State, or any agency or instrumentality of a State or its political subdivision. A State does not include the federal government or an agency or instrumentality thereof.

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Nonqualified Deferred Compensation Plan

Adoption Agreement

“Substantial Risk of Forfeiture”

409A Amounts . Substantial Risk of Forfeiture means as to 409A Amounts, and other than for purposes of application of Code §457(f), Compensation which is payable conditioned: (i) on the performance of substantial future services by any person including the Participant; or (ii) on the occurrence of a condition related to a purpose of the Compensation, and where under clause (i) or (ii) the possibility of forfeiture is substantial. A condition related to the purpose of the Compensation relates to the Participant’s performance for the Employer or to the Employer’s business activities or organizational goals. A Substantial Risk of Forfeiture includes conditioning payment on the Participant’s Involuntary Separation from Service without cause provided the possibility of not incurring such a Separation from Service is substantial. Except as to payment of Compensation related to a Change in Control, a Substantial Risk of Forfeiture does not include any addition of a condition after a Legally Binding Right to the Compensation arises or any extension of a period during which the Compensation is subject to a Substantial Risk of Forfeiture. Compensation is not subject to a Substantial Risk of Forfeiture merely because payment is conditioned on the Participant’s refraining from performing services. Compensation is not subject to a Substantial Risk of Forfeiture beyond the date or time that the Participant otherwise could have elected to receive the Compensation unless the present value of the amount subject to the Substantial Risk of Forfeiture (determined without regard to the Substantial Risk of Forfeiture) is materially greater than the present value of the amount that the Participant otherwise could have elected to receive, absent the Substantial Risk of Forfeiture. As such, a Participant’s Elective Deferrals generally may not be made subject to a Substantial Risk of Forfeiture if the Participant could have elected to receive an equivalent amount in cash. In addition, Compensation the Participant would receive for continuing to perform service for the Employer (such as through the extension of an employment contract) is disregarded in determining whether the present value of such nonvested payment amount is materially greater than the Compensation which the Participant could have elected to receive presently. In determining whether the possibility of forfeiture is substantial in the case of rights to Compensation granted to a Participant who owns significant voting power or value in the Employer, the Employer in accordance with Treas. Reg. §1.409A-1(d)(3) and Applicable Guidance, will take into account all relevant facts and circumstances.

Grandfathered Amounts . A Substantial Risk of Forfeiture for Grandfathered Amounts is defined in Treas. Reg. §1.83-3(c) and in Notice 2005-1, Q/A-16(b) or in Applicable Guidance.

Ineligible 457 Plan . A Substantial Risk of Forfeiture for purposes of application of Code §457(f) under an Ineligible 457 Plan is described in Code §457(f)(3)(B), Treas. Reg. §1.83-3(c) and Applicable Guidance.

“Tax-Exempt Organization” means any tax-exempt organization other than: (i) a governmental unit; or (ii) a church or a qualified church-controlled organization within the meaning of Code §§3121(w)(3)(A) and 3121(w)(3)(B).

“Taxable Year” means as to the Participant, the Participant’s taxable year and means as to the Employer, the Employer’s taxable year, in each case as the Plan provides or as the context otherwise requires.

“Trust” means the trust, if any, described in Section 5.03 of the Basic Plan Document and which the Employer in its Adoption Agreement elects to create.

“Unforeseeable Emergency” means: (i) a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, a Beneficiary or the Participant’s dependent (as defined in Code § 152 but without regard to Code §§152(b)(1), (b)(2) and (d)(1)(B)); (ii) loss of the Participant’s property due to casualty; or (iii) other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the Participant’s control. The Employer in its Adoption Agreement will elect whether to permit payment based on a Participant’s Unforeseeable Emergency. The Employer will determine whether a Participant incurs an Unforeseeable Emergency based on the relevant facts and circumstances and in accordance with Treas. Reg. §1.409A-3(i)(3) or Applicable Guidance, but in any case, the Plan may not make payment to the extent that the Unforeseeable Emergency may be relieved: (i) through reimbursement or compensation from insurance or otherwise; (ii) by liquidation of the Participant’s assets to the extent that such liquidation of assets would not itself cause severe financial hardship; or (iii) by the

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Nonqualified Deferred Compensation Plan

Adoption Agreement

Participant’s cessation of Elective Deferrals under the Plan. The Plan must limit the amount of any payment based on Unforeseeable Emergency to the amount that is reasonably necessary to satisfy the emergency need, which may include amounts necessary to pay any Federal, state, local or foreign income taxes or penalties reasonably anticipated to result from the payment. The Employer in making the determination as to the amount of payment must take into account any additional Compensation available to the Participant upon cancellation of an Elective Deferral election under Section 4.03(D)(vii). However, the Employer in determining “necessity” may disregard amounts available as a hardship distribution or a loan from a qualified plan or as an unforeseeable emergency distribution from another nonqualified plan, regardless of whether such amount is 409A Amount or is a Grandfathered Amount. If the Employer in its Adoption Agreement elects to permit payment based on Unforeseeable Emergency, the Employer further will elect whether to permit payment based on all events that will constitute an Unforeseeable Emergency or to limit such events to a subset of specific events which will so qualify. The Employer will not pay a Participant any Deferred Compensation based an Unforeseeable Emergency unless the Participant requests such payment on a form the Employer provides for this purpose, the Employer determines that the payment would qualify under the Plan terms as being based on the Participant’s Unforeseeable Emergency, and the Employer in its sole discretion otherwise approves the payment. Neither a Participant’s request or failure to request an Unforeseeable Emergency payment nor the Employer’s acceptance or rejection of such a request is a change payment election under Section 4.02(B).

“USERRA” means the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended.

“Valuation Date” means the last day of each of the Employer’s Taxable Year and such other dates as the Employer may determine.

“Vested” means an amount of Deferred Compensation which is not subject to a Substantial Risk of Forfeiture or to a requirement to perform further services for the Employer. For purposes of determining whether an amount satisfies the vesting requirement for Grandfathered Amounts under Article VII, the definition of Substantial Risk of Forfeiture in Section 1.47(B) applies.

“Window Program” means a program the Employer establishes in connection with an impending Separation from Service to provide Separation Pay to separated Participants and which program is available only for a period of up to 12 months for Participants who separate during such period or who separate during such period under specified circumstances. A Window Program does not include a program the Employer establishes under which there is a pattern of repeated provision of similar Separation Pay in similar situations for substantially consecutive limited periods of time. Whether a recurrent program constitutes such a pattern depends upon all of the facts and circumstances, including whether the benefits are account of a specific event or condition, the degree to which the separation pay relates to the event or condition and whether the event or condition is temporary or discrete or is a permanent aspect of the Employer’s business.

“Wraparound Election” means as to a Participant who also is a participant in a 401(k) plan of the Employer, an election (or elections, if made separately) to defer compensation under both plans with the result that the Participant will achieve under the 401(k) plan, the maximum amount of elective deferrals and matching contributions, if any, as is permissible under the 401(k) plan terms and under Code §§402(g), 401(k)(3), 401(m), 415 and 414(v). For any Participant’s Taxable Year, the maximum amount of Elective Deferrals the Plan will transfer as to the Participant (and corresponding decrease in amounts of Compensation Deferred to this Plan) may not exceed the Code §402(g) limit (but increased by catch-up contributions under Code §414(v) for any year in which the Participant is catch-up eligible). For any Participant’s Taxable Year, the maximum amount of Matching Contributions the Plan will transfer as to the Participant (and corresponding decrease in amounts of Compensation Deferred to this Plan) may not exceed the maximum amount of matching contributions that would be provided under the 401(k) plan absent any plan-based restrictions which reflect Code limits on qualified plan contributions. Under a Wraparound Election, the Plan promptly following completion of 401(k) plan testing and within any time required under Applicable Guidance, will transfer from the Participant’s Account such Elective Deferrals and related Matching Contributions for the Taxable Year (but without Earnings thereon) as are consistent with the Wraparound Election, to the Participant’s account under the 401(k) plan to

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Nonqualified Deferred Compensation Plan

Adoption Agreement

be held and administered in accordance with the 401(k) plan. Any remaining amounts not transferred to the 401(k) plan will remain in and be administered in accordance with this Plan. The Employer in its Adoption Agreement will specify whether a participant may make a Wraparound Election. A Participant will make a Wraparound Election subject to any timing requirements of Applicable Guidance and on a form the Employer provides for this purpose.

“Year of Service” means the requirements, if any, the Employer specifies in its Adoption Agreement.

Participation

Participants Designated . The Employer will designate from time to time in its Adoption Agreement those Employees or Contractors (by name, job title or other classification) who are Participants in the Plan.

Elective Deferrals . The Employer will specify in its Adoption Agreement whether Participants may elect to make Elective Deferrals to their Accounts.

Limitations . The Employer will specify in its Adoption Agreement any amount limitations or conditions applicable to Elective Deferrals.

Election Form and Timing . A Participant must make his/her Elective Deferral election on an election form the Employer provides for that purpose. The Participant must make the election no later than the latest of the applicable times specified below. The Employer in its Adoption Agreement will elect that a Participant must make and deliver his/her election to the Employer no later than: (i) such applicable time; or (ii) the number of days prior to such applicable time as the Employer sets forth in its Adoption Agreement. The Employer will disregard any Elective Deferral election which is not timely under this Section 2.02(B).See Section 6.04.

General Timing Rule . Except as otherwise provided in this Section 2.02(B), a Participant must deliver to the Employer his/her Elective Deferral election regarding Service Year Compensation no later than the end of the Participant’s Taxable Year which is prior to the Service Year.

New Participant/New Plan . As to the Service Year in which an Employee or a Contractor first becomes a Participant (a “newly eligible Participant”), the Participant must make and deliver an Elective Deferral election for that Service Year not later than 30 days after the Employee or Contractor becomes a Participant. All Participants who are eligible to participate on the Effective Date of a new plan are newly eligible Participants as of the Effective Date.

Participant status . For purposes of this Section 2.02(B)(2), an Employee or Contractor is eligible to participate in the Plan at any time during which, under the Plan terms and without further amendment or action by the Employer, the Employee or Contractor is eligible to accrue Deferred Compensation under the Plan (other than Earnings on prior Deferred Compensation), even if the Employee or Contractor has elected not to accrue any such Deferred Compensation (or has made no election).

Changes in status . For purposes of this Section 2.02(B)(2),_if a Participant has been paid all Deferred Compensation and on or before the last payment ceases to be eligible to participate in the Plan, but thereafter becomes eligible to participate, the Employee or Contractor is treated as a newly eligible Participant. If a Participant ceases to be eligible to participate, other than as to Earnings, regardless of whether the Participant has been fully paid all Deferred Compensation under the Plan, and subsequently becomes eligible to participate, the Employee or Contractor is treated as a newly eligible Participant provided that the period during which the Employee or Contractor was ineligible was at least 24 months.

Compensation to which election applies . Under this Section 2.02(B)(2), a Participant’s election may apply only to Compensation for services the Participant performs subsequent to the date the Participant delivers the election to the Employer. For Compensation that is earned for a specified performance period, including an

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Nonqualified Deferred Compensation Plan

Adoption Agreement

annual bonus, if the newly eligible Participant makes an Elective Deferral election after the performance period commences, the Employer will pro rate the election by multiplying the performance period Compensation by the ratio of the number of days left in the performance period at the time of the election, over the total number of days in the entire performance period.

Excess benefit plan . For purposes of this Section 2.02(B)(2), if this Plan is an excess benefit plan, an Employee is a newly eligible Participant in the Plan as of the first day of the Employee’s Taxable Year immediately following the first year in which he or she accrues a benefit under the Plan. Any election the Employee makes within 30 days following such date applies to any benefits accrued for services provided before the election. An excess benefit plan for purposes of this Section 2.02(B)(2)(d) means a plan under which all Deferred Compensation is attributable to Employer Contributions and is based on the amount the Participant would have accrued under the Employer’s qualified plan(s) but for one or more Code limits which apply to the qualified plan(s) over the benefits the Participant actually accrues in such plan(s). Once a Participant has accrued a benefit or deferred compensation in any year, the Participant is not eligible to use the delayed election in this Section 2.02(B)(2)(d).

Aggregated Plans . All references to the Plan in this Section 2.02(B)(2) include Aggregated Plans. As such, an Employee or Contractor who participates in an Aggregated Plan is not a newly eligible Participant and this Section 2.02(B)(2) does not apply.

Certain Forfeitable Rights . If payment of Deferred Compensation is subject to a condition requiring the Participant to perform services for the Employer for at least 12 months after the Participant obtains the Legally Binding Right to the Compensation to avoid forfeiture of the payment, the Participant may make an Elective Deferral election no later than 30 days after the Participant obtains the Legally Binding Right to the Compensation, provided the Participant makes the election at least 12 months prior to the earliest date on which the service forfeiture condition could lapse. If the Plan provides for a waiver of the service condition upon the Participant’s death, Disability or upon a Change in Control, and such event occurs before the end of the 12 month minimum service period, the Participant’s elective Deferral election is valid only if the election is timely under the Plan without regard to this Section 2.02(B)(3).

Performance-Based Compensation . As to any Performance-Based Compensation, a Participant may elect no later than 6 months before the end of the performance period to defer such Compensation, provided that the Participant: (i) continuously performs services from the later of the beginning of the performance period or the date the Employer establishes the performance criteria and at least through the date of the Participant’s election; and (ii) may not make an election after the Compensation has become readily ascertainable. For purposes of this Section 2.02(B)(4), if the Performance-Based Compensation is a specified or calculable amount, the Compensation is readily ascertainable if and when the amount is first substantially certain to be paid. If the Performance-Based Compensation is not a specified or calculable amount, the Compensation or any portion thereof is readily ascertainable when the amount is first both calculable and substantially certain to be paid. In applying this Section 2.02(B)(4), the Employer will bifurcate any right to payment as between amounts which are readily ascertainable and amounts which are not readily ascertainable.

Commissions .

Sales Commissions . For purposes of election timing under this Section 2.02(B), if Compensation consists of Sales Commissions, the Participant is treated as providing the services giving rise to the Commissions in the Participant’s Taxable Year in which the customer remits payment to the Employer, or, if applied consistently to all similarly situated service providers, the Participant’s Taxable Year in which the sale occurs.

Investment Commissions . For purposes of election timing under this Section 2.02(B), if Compensation consists of Investment Commissions, the Participant is treated as providing the services giving rise to the Commissions over the 12 months preceding the date as of which the overall value of the assets or the asset accounts is determined for purposes of calculation of the Investment Commissions.

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Nonqualified Deferred Compensation Plan

Adoption Agreement

Final Payroll Period . If Compensation is payable after the last day of the Participant’s Taxable Year, but is Compensation for the Participant’s services during the final payroll period within the meaning of Code §3401(b) (or, as to a Contractor, a period not longer than such period) which contains the last day of the Participant’s Taxable Year, the Compensation is treated for purposes of an election under this Section 2.02(B), as Compensation: (i) for the current Taxable Year in which the final payroll period commenced; or (ii) for the subsequent Taxable Year in which the Employer pays the Compensation, as the Employer elects in its Adoption Agreement. This Section 2.02(B)(6) does not apply to Compensation for services performed over any period other than the final payroll period as described herein, including an annual bonus. If the Employer amends its Adoption Agreement after December 31, 2007, to alter the timing rule of this Section 2.02(B)(6), any such amendment may not take effect until 12 months after the later of the date the amendment is executed and is effective. If the Plan is a restated Plan, whatever election the Employer makes in it Adoption Agreement on or before December 31, 2007, applies to any period spanning 2005 through 2007, as applicable, unless the Employer indicates otherwise in its election.

Separation Pay/Window Program . If the Participant’s election relates to Separation Pay (based on voluntary or involuntary Separation from Service) and the Separation Pay is the subject of bona-fide, arm’s length negotiations at the time of Separation from Service, the Participant may make an election under this Section 2.02(B) at any time up to the time that the Participant has a Legally Binding Right to the Separation Pay. This Section 2.02(B)(7) does not apply to any Separation Pay to which the Participant obtained a Legally Binding Right before the negotiations at the time of Separation from Service, including a right to payment subject to a condition. If the Separation Pay results from a Window Program, the Participant may make the election at any time up to the time that the Participant’s election to participate in the Window Program becomes irrevocable.

Fiscal Year Employer . In the event that the Employer’s Taxable Year is a not the same as the Participant’s Taxable Year, a Participant may elect to defer Compensation which is co-extensive with one or more of the Employer’s consecutive Taxable Years, and no amount of which is paid or payable during the Employer’s Taxable Year or Years constituting the period of service, by making an election no later than the end of the Employer’s Taxable Year which precedes the Employer’s first Taxable Year in which the Participant performs the service for which the Compensation is payable.

Election Changes/ Irrevocability . The Employer in its Adoption Agreement will elect whether a Participant’s Elective Deferral election made prior to the Section 2.02(B) deadline becomes irrevocable as to a Taxable Year: (i) following the last day on which a Participant may make an election under Section 2.02(B) for such Taxable Year; or (ii) if earlier, when the Participant makes the election for a Taxable Year. For this purpose, a Participant’s Elective Deferral election is considered made when the Employer accepts the election. If the Employer elects to permit changes to an election up to the Section 2.02(B) election deadline, a Participant may make any number of changes to his/her Elective Deferral election during the period prior to the election becoming irrevocable. If the Employer elects in its Adoption Agreement and under Section 2.02(D) that a Participant’s election is continuing, the Participant is deemed to have made an irrevocable election as to each Taxable Year on the last day that the Participant could have made an election under Section 2.02(B). As such, the Participant may revoke or modify a continuing election for a Taxable Year up to the date that such election is deemed made and irrevocable for that Taxable Year. A change payment election under Section 4.02(B) or a permissible acceleration under Section 4.02(C)(3) does not render an Elective Deferral election and an accompanying initial payment election under Section 4.02(A) revocable within the meaning of this Section 2.02(C).

Election Duration/Cancellation . As the Employer elects in its Adoption Agreement, a Participant’s Elective Deferral election remains in effect: (i) only for the duration of the Taxable Year for which the Participant makes the election; or (ii) for the duration of the Taxable Year for which the Participant makes the election and for all subsequent Taxable Years unless the Participant executes a subsequent timely election, modification or revocation. A Participant, subject to Plan requirements regarding election timing, may make a new election, or may revoke or modify an existing election effective no earlier than for the next Taxable Year, provided that under Section 4.02(C)(3), a Participant may cancel an existing and otherwise irrevocable election for a Taxable Year at any time following the Participant’s receipt

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Nonqualified Deferred Compensation Plan

Adoption Agreement

of an Unforeseeable Emergency distribution or of a distribution from the Employer’s 401(k) plan based upon hardship within the meaning of Treas. Reg. §1.401(k)-1(d)(3).

“Non-Elections” or Deemed Compliance .

Linkage to Qualified or Certain Foreign Plans . The following are not elections under Section 2.02(B): (i) the amount of Compensation Deferred under this Plan is determined under a formula for determining benefits under the Employer’s qualified plan or broad-based foreign retirement plan (but applied without regard to Code or foreign law imposed limitations); or (ii) the amount of Compensation Deferred under this Plan is offset by some or all benefits provided under the Employer’s qualified plan or broad-based foreign plan and where in either case the amount of Compensation Deferred under the Plan increases on account of changes in the Code or foreign law imposed benefit limitations applicable to the qualified plan or foreign plan, provided in either case such operation does not result in a change in the time or form for payment under this Plan and that the change in the amounts of Compensation Deferred do not exceed the change in amounts deferred under the qualified plan or foreign plan.

Actions/Inactions (including Wraparound Elections) . The following Participant actions or in actions are not elections under Section 2.02(B), even if they result in an increase in Compensation Deferred under the Plan: (i) election or non-election under the Employer’s qualified plan or broad-based foreign plan as to receipt of a subsidized or ancillary benefit under such plans; (ii) an amendment of such other plans’ benefits to add or remove a subsidized or ancillary benefit or to freeze or limit future accruals under the qualified plan or foreign plan or to reduce existing benefits under the foreign plan; or (iii) a Participant’s Wraparound Election, provided in all cases such action or inaction does not result in a change in the time or form for payment under this Plan and that under clauses (i) and (ii) above, the change in the amounts of Compensation Deferred do not exceed the change in amounts deferred under the qualified plan or foreign plan.

Elections under a Cafeteria (125) Plan . If a Participant who is also a participant in a cafeteria (Code § 125) plan of the Employer, changes an election under the cafeteria plan with the result that the amount of Compensation Deferred under this Plan changes on account of an increase or decrease in Compensation under this Plan as a result of the cafeteria plan election, the cafeteria plan election is not an election for purposes of Section 2.02(B).

USERRA Rights . The requirements of Section 2.02(B) are deemed satisfied as to any Elective Deferral election (including an initial payment election) which the Plan provides to satisfy the requirements of USERRA.

Annualizing Recurrent Partial Year Compensation . If a Participant is receiving recurring part-year Compensation, the Participant’s election to defer all or a portion of such Compensation to be earned during a particular service period is deemed to satisfy the requirements of Section 2.02(B) if the Participant makes the election before the services giving rise to the Compensation begin and the election does not defer payment of any of such Compensation to a date beyond the last day of the 13 ^th month following the first date of the service period. For purposes of this Section 2.02(E)(5), recurring part-year Compensation means Compensation paid for services rendered as to a position the Participant and the Employer reasonably anticipate will continue on similar terms and on similar conditions in subsequent years, and will require services to be provided in successive service periods, each of which comprises less than 12 months and each of which begins in one Taxable Year of the Participant and ends in the next Taxable Year. This Section 2.02(E)(5) applies only once to Compensation Deferred such that the same amount may not again be treated as recurring part-year Compensation and subject to a second deferral election.

Nonelective Contributions . The Employer will specify in its Adoption Agreement whether the Employer will or may make Nonelective Contributions to the Plan, and the terms and conditions applicable to any Nonelective Contributions.

Matching Contributions . The Employer will specify in its Adoption Agreement whether the Employer will or may make Matching Contributions to the Plan, and the terms and conditions applicable to any Matching Contributions.

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Nonqualified Deferred Compensation Plan

Adoption Agreement

Actual or Notional Contribution . The Employer will specify in its Adoption Agreement whether it will make any Employer Contribution as a notional contribution or as an actual contribution. If the Employer establishes the Trust, any Employer Contributions to the Trust will be actual contributions.

Allocation Conditions . The Employer will specify in its Adoption Agreement or an exhibit thereto any employment or other condition applicable to the allocation of Employer Contributions for a Taxable Year.

Timing . The Employer may elect to make any Employer Contribution for a Taxable Year at such times as Code §409A or Applicable Guidance may permit. The Employer is not required to contribute any actual contribution (or to post any notional contribution) to an Account at the time that the Employer makes its contribution election.

Administration . The Employer will administer all Employer Contributions in the same manner as Elective Deferrals, and will treat the Employer’s election to make Employer Contributions as an Elective Deferral election, except as the Plan otherwise provides. If the Employer establishes the Trust, the Employer will remit any Elective Deferrals to the Trust and will make any Employer Contributions to the Trust. Any Employer Contribution is not subject to an immediate Participant right to elect a cash payment in lieu of the Employer Contribution and such amounts are payable only in accordance with the Plan terms.

Vesting and Substantial Risk of Forfeiture

Vesting Schedule or other Substantial Risk of Forfeiture . The Employer will specify in its Adoption Agreement any vesting schedule or other Substantial Risk of Forfeiture applicable to Participant Accounts. If the Plan is an Ineligible 457 Plan, the Employer must specify a Substantial Risk of Forfeiture.

Immediate Vesting on Specified Events . The Employer will specify in its Adoption Agreement whether a Participant’s Account is Vested without regard to Years of Service if the Participant Separates from Service on or following Retirement Age, or as a result of death, Disability, or other events.

Application of Forfeitures . A Participant will forfeit any non-Vested Accrued Benefit (where vesting is based on a service condition) upon Separation from Service. A Participant will forfeit any other non-Vested Accrued Benefit when the condition constituting a Substantial Risk of Forfeiture can no longer be satisfied, such as its expiration date. The Employer will specify in its Adoption Agreement how it will apply Participant forfeitures under the Plan.

Benefit Payments

Payment Events . The Employer in its Adoption Agreement will specify the Plan permissible payment events as all or some of the following payment events affecting a Participant: (i) Separation from Service; (ii) death; (iii) Disability; (iv) a Specified Time or pursuant to a Fixed Schedule; (v) Change in Control; or (vi) Unforeseeable Emergency. As to payment events (i), (ii),(iii) (v) and (vi), the Plan will pay to the Participant the Vested Accrued Benefit held in the Participant’s Account on the applicable payment event or on another specified payment date as provided in Section 4.01(A). Payment will commence at the time and payment will be made in the form and medium specified under Section 4.02. See Section 4.02 as to payment elections, including as to payment events under this Section 4.01.

Payment on Objective and Nondiscretionary (Specified) Payment Date(s) . The Plan or an initial payment election or change payment election must provide for a payment date that the Employer, at the time of the payment event, can determine objectively and without the exercise of discretion. Such payment date may, but need not, coincide with a payment event, but any payment date must be on or following and must relate to a Plan payment event.

Payment Schedule as Payment Date . A specified payment date may include a payment schedule which is objectively determinable and nondiscretionary based on the date of the payment event and that would qualify as a Fixed

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Schedule if the payment event were a fixed date. An election of a payment schedule must be made at the time of the election of the payment event.

Designation of Year or Other Period . A specified payment date or a specified payment schedule with regard to any payment event other than a Specified Time or pursuant to a Fixed Schedule may include: (i) a Participant’s Taxable Year or Years; or (ii) a designated period of time but only if the designated period both begins and ends within one Taxable Year of the Participant or the designated period is not more than 90 days and the Participant does not have the right to designate the Taxable Year of payment except under a change payment election under Section 4.02(B). For purposes of clause (ii), this includes designation of payment on or before the last date of the designated (maximum 90 day) period but after the payment event occurs.

Deemed Payment Date . If the Adoption Agreement or any such election provides for payment only in a designated Taxable Year or Years, the payment date is deemed to be January 1 of that Year or Years. If the Adoption Agreement or any such election provides for payment only in a designated period, the payment date is deemed to be the first day in the relevant period.

Payment Event Default . This Section 4.01(B) applies if the Employer in its Adoption Agreement fails to elect one or more payment events described in this Section 4.01, if a Participant or the Employer under Section 4.02 fails to elect one of more payment events where the Adoption Agreement affords them such an election, or if the Employer under Section 4.06 rejects the election and the Participant does not timely file a new election the Employer accepts. In such event, the Plan will pay the affected Participant’s Vested Benefit held in the Participant’s Account following the earlier of the Participant’s Separation from Service or death. See Section 4.02(A)(5) as to the applicable default for the time, form and medium of such payments. If this default provision applies, the default payment is deemed to be an initial payment election under the Plan.

Multiple Payment Events; Sequencing . The Plan or an initial payment election or a change payment election may provide for more than one permissible payment event and may provide for payment upon the earliest or latest of more than one permissible payment event. See Section 4.02(A)(4) as to limitations on the number of time and form of payment elections which may apply to a single payment event. In a Separation Pay Plan, the Plan or any election may provide for any payment only upon Separation from Service (including as a result of death or Disability).

Payment to Specified Employees . Notwithstanding anything to the contrary in the Plan or in a Participant or Employer payment election, the Plan may not make payment, based on Separation from Service to a Participant who, on the date of Separation from Service is a Specified Employee, earlier than 6 months following Separation from Service (or if earlier, upon the Specified Employee’s death), except as permitted under this Section 4.01(D). This limitation applies regardless of the Participant’s status as a Specified Employee or otherwise on any other date including the next Specified Employee effective date had the Participant continued to render services through such date. The Employer, operationally and without any direct or indirect Participant election, will elect whether any payments that otherwise would be payable to the Specified Employee during the foregoing 6 month period: (i) will be accumulated and payment delayed until the first day of the seventh month that is after the 6 month period; or (ii) will be delayed by 6 months as to each installment otherwise payable during the 6 month period. This Section 4.01(D) does not apply to payments made on account of a domestic relations order, payments made because of a conflict of interest, or payment of employment taxes, all as described in Treas. Reg. 1.409A-3(i)(2)(i). This Section 4.01(D) also does not apply to any reimbursement or in-kind benefit which is Separation Pay but which is not Deferred Compensation under Section 1.18(A).

Deemed Separation of Contractor . The Employer in its Adoption Agreement may elect to apply the special payment timing rules in this Section 4.01(E) as to Contractors. Compliance with this Section 4.01(E) results in the Contractor being deemed to have incurred a Separation from Service under Section 1.39. Under this Section 4.0I(E): (i) the Plan will not pay a Contractor’s Account, or any portion thereof, before a date that is at least 12 months after the expiration of the contract (or all contracts) under which the Contractor performs services for the Employer; and (ii) no

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Adoption Agreement

amount payable under clause (i) will be paid to the Contractor if the Contractor (whether as a Contractor or an Employee) performs services for the Employer after the contract(s)’ expiration and before the payment date.

Timing, Form and Medium/ Payment Elections . Unless the Employer under Section 4.02(A) and/or 4.02(B) permits Employer or Participant elections, the Employer (in addition to its election of permissible payment events under Section 4.01) will elect in its Adoption Agreement the permissible: (i) payment timing; (ii) payment form (lump-sum, installments, annuity or other form, including a combination thereof); and (iii) payment medium (cash or property) applicable to Plan Accounts (all of which elections are collectively, “payment elections”). Until the Plan pays a Participant’s entire Vested Accrued Benefit, the Plan will continue to credit the Participant’s Account with Earnings, in accordance with Section 5.02(A) or Section 5.03(B) as applicable. A permissible payment medium election may, but is not required to be, made at the same time as the initial payment election or change payment election, but must be made a reasonable time before any payment date. No election as to payment medium may change the time or form of payment.

Initial Payment Election . The Employer will elect in its Adoption Agreement: (i) whether a Participant or the Employer may make an initial payment election or whether there are no Participant or Employer initial payment elections and the payment events, timing, form and medium are controlled by the Employer’s Adoption Agreement elections; and (ii) whether any Participant payment election applies to all Account types or only applies to a Participant’s Elective Deferral Account. A Participant must make any permissible initial payment election on a form the Employer provides for that purpose.

No elections are a Deemed Initial Election . If the Employer elects in its Adoption Agreement not to provide any Participant or Employer initial payment elections, the elected Adoption Agreement and applicable Plan provisions constitute an initial payment election under the Plan.

Timing .

Participant Election . A Participant must make an initial payment election at the time of the Participant’s Elective Deferral election under Section 2.02(B), or in the absence of such an Elective Deferral election but where the Participant may make an initial payment election as to Employer Contributions, within the same time period as such an Elective Deferral election would be permitted.

Employer Election . The Employer must make an initial payment election as to a Participant at the time that the Employer grants a Legally Binding Right to Deferred Compensation to the Participant, or, if later, by the time that the Participant would have had to make such election, if the Plan had permitted the Participant to make such an election. In the case of a newly eligible Participant or a new Plan described under Section 2.02(B)(2), the Employer must make the initial payment election no later than 30 days after the date the Employee or Contractor becomes a Participant and the pro ration provisions of Section 2.02(B)(2)(c) do not apply to such Employer election.

Future Deferred Compensation and Earnings . A payment election may apply only to the Deferred Compensation that is the subject of the Elective Deferral election or the Employer Contribution or may apply to such Deferred Compensation and to all future Deferred Compensation, as the payment election indicates. A payment election separately may apply to Deferred Compensation and to the Earnings thereon provided that the Plan credits Earnings at least annually.

Limitations on Payment Time and Form; Multiple Payment Events . Except as otherwise provided in this Section 4.02(A)(4), the Plan or a payment election may designate only one time and form of payment for each of the following payment events: Separation from Service, Disability, death or Change in Control.

Disability, Death or Change in Control . In the case of payment in the event of Disability, death or Change in Control, the Plan or payment election may provide for one time and/or method of payment if the event occurs

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on or before one specified date and may provide for an alternative time and form of payment if the event occurs after the specified date.

Separation From Service. In the case of payment in the event of Separation from Service, the Plan or payment election may provide for an alternative time and form of payment where: (i) Separation from Service occurs within a limited period of time not exceeding two years following a Change in Control; (ii) Separation from Service occurs before or after a specified date or Separation occurs before or after the combination of a specified date and a specified period of service determined under a predetermined, nondiscretionary objective formula or pursuant to the method for crediting service under a qualified plan of the Employer (but not both of the options under clause (ii)); and Separation from Service which is not described in clause (i) or (ii). However, neither the Plan nor a payment election may provide for a different time and form of payment based on whether Separation from Service is Voluntary or Involuntary or based on the Participant’s marital status at the time of Separation from Service.

Unforeseeable Emergency . If the Employer in its Adoption Agreement elects to permit Unforeseeable Emergency as a payment event, a Participant at any time may request payment based on Unforeseeable Emergency by submitting to the Employer a form the Employer provides for this purpose. The Plan will make payment to the Participant within 90 days following the Employer’s acceptance of the Participant’s Unforeseeable Emergency payment request. If that 90-day period spans more than one Taxable Year of the Participant, the Participant will not have any discretion over the Taxable Year of payment. See Section 1.51 as to additional requirements relating to an Unforeseeable Emergency payment.

Addition, Change or Deletion of Time and Form . The addition, change, or deletion of an alternative time and form of payment (after the initial payment election has become irrevocable) as permitted under this Section 4.02(A)(4) is a change payment election subject to Section 4.02(B) and is subject to Section 4.02(C).

Time, Form and Medium Default . If the Participant or the Employer as applicable has the right to make an initial payment election but fails to do so, or if the Employer rejects the Participant’s election under Section 4.06 and the Participant does not make a new timely election the Employer accepts, the Plan will pay the affected Participant’s Vested Accrued Benefit attributable to the non-election under this default provision, in a lump-sum cash payment 13 months following the earliest event permitting payment of the Participant’s Account under Section 4.01 (including, if applicable, the default payment events under Section 4.01(B)). If this default provision applies, the default payment is deemed to be an initial payment election under the Plan.

Change Payment Election . The Employer will elect in its Adoption Agreement whether the Employer or a Participant may make a change payment election under this Section 4.02(B). If the Plan permits change elections, the Employer in its Adoption Agreement will elect whether to limit the number of change payment elections. If the Plan permits a Participant or the Employer to change existing payment elections (initial or change payment elections) as to any or all Deferred Compensation, including any Plan specified initial payment election or a default payment applicable in the absence of an actual initial payment election, any such change payment election must comply with this Section 4.02(B). A change payment election may add or delete payment events, may delay payment and/or may change the form of payment, provided the change does not result in an impermissible acceleration under Section 4.02(C). The Employer in its Adoption Agreement will elect whether a Beneficiary following a Participant’s death may make a change payment election under this Section 4.02(B). A Participant’s change of Beneficiary is not a change payment election provided that the time and method of payment is not otherwise changed. See Section 4.02(B)(3) as to changes of Beneficiary where the payment method is a life annuity. A Participant or Beneficiary must make any change payment election on a form the Employer provides for such purpose.

Conditions on Change Payment Elections .

Election Timing/Deferral of Payment . Any change payment election: (i) may not take effect until at least 12 months following the date the change payment election is made; (ii) if the change payment election relates to a

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payment based on Separation from Service or on Change in Control, or if the payment is at a Specified Time or pursuant to a Fixed Schedule, the change payment election must result in payment being made not earlier than 5 years following the date upon which the payment otherwise would have been made (or, in the case of a life annuity or installment payments treated as a single payment, 5 years from the date the first amount was scheduled to be paid); and (iii) if the change payment election relates to payment at a Specified Time or pursuant to a Fixed Schedule, the Participant or Employer must make the change payment election not less than 12 months prior to the date the payment is scheduled to be made (or, in the case of a life annuity or installment payments treated as a single payment, 12 months prior to the date the first amount was scheduled to be paid).

Application of Other Rules . A change payment election must satisfy the Plan provisions applicable to initial payment elections under Section 4.02(A)(4) related to multiple payment events and Section 4.02(A)(3) regarding scope and Earnings also applies to change payment elections. For purposes of application of Section 4.02(A)(4), Section 4.02(B)(1)(a) applies separately as to each Payment described under Section 4.02(B)(2) and due upon each payment event.

Rejection . If the Employer under Section 4.06 rejects a Participant or Beneficiary change payment election, the Participant’s initial payment election or deemed initial payment election continues to apply unless and until the Participant makes another change payment election which the Employer accepts.

USERRA Rights . The requirements of Section 4.02(B) are deemed satisfied as to any change payment election which the Plan provides to satisfy the requirements of USERRA. Such elections are not an acceleration under Section 4.02(C).

Definition of “Payment.” Except as otherwise provided in Section 4.02(B)(3), a “payment” for purposes of applying Section 4.02(B)(1) is each separately identified amount the Plan is obligated to pay to a Participant on a determinable date and includes amounts paid for the benefit of the Participant. An amount is “separately identified” only if the amount is objectively determinable under a nondiscretionary formula. A payment includes the provision of any taxable benefit, including payment in cash or in-kind. A payment includes, but is not limited to, the transfer, cancellation or reduction of an amount of Deferred Compensation in exchange for benefits under a welfare benefit plan, fringe benefits excludible under Code §§119 or 132, or any other benefit that is excluded from gross income. In the case of a Specified Time or a Fixed Schedule, “payment” for purposes of Section 4.02(B)(1) means as further described in Treas. Reg. §1.409A-3(i)(1).

Life Annuities and Installment Payments .

Life Annuities . A life annuity is treated as a single payment. For purposes of this Section 4.02(B)(3), a “life annuity” is a series of substantially equal periodic payments, payable not less frequently than annually, for the life (or life expectancy) of the Participant, or the joint lives (or life expectancies) of the Participant and of his/her Beneficiary. A change of Beneficiary which occurs before the initial payment of a life annuity is not a change payment election. A change in the form of payment before any annuity payment has been made from one type of life annuity to another with the same scheduled date for the first payment is not subject to the change payment election requirements provided that the annuities are actuarially equivalent applying reasonable actuarial assumptions and that at any given time, the same actuarial assumptions and methods are used to value each annuity. The requirement of actuarial equivalence applies for the duration of the Participant’s participation in the Plan such that the annuity payment must be actuarially equivalent at all times for the annuity payment options to be treated as a single time and method of payment. The Plan over time may change actuarial assumptions and methods provided such methods and assumptions are reasonable. The following features are disregarded in determining if the payment is a life annuity but are taken into account in determining if one life annuity is the actuarial equivalent of another: (i) term certain features under which payments continue for the longer of the annuitant’s life or for a fixed period of time; (ii) pop-up features under which payments increase upon the death of the Beneficiary or other event which eliminates the survivor annuity; (iii) cash refund features under which there is a payment on the death of the last annuitant in an amount not greater than the excess

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of the present value of the annuity at the annuity starting state over the total payments before the last annuitant’s death; (iv) a feature under which the annuity provides higher periodic payments before the expected commencement of Social Security or Railroad Retirement Act benefits and lower payments after the expected commencement of such benefits, such the combined payments are approximately level before and after the expected commencement date; and (v) features providing for a cost-of-living increase in the annuity payment in accordance with Treas. Reg. §1.409A-6, Q & A-14(A)(1) or (2). A joint and survivor annuity does not fail to be actuarially equivalent to a single life annuity solely due to the value of a subsidized survivor benefit provided the annual lifetime annuity to the Participant is not greater than the annual lifetime benefit to the Participant under the single life annuity and the annual survivor annuity benefit is not greater than the annual lifetime annuity to the Participant under the joint and survivor annuity.

Installments . The Employer in its Adoption Agreement will elect whether to treat a series of installment payments which are not a life annuity as a single payment or as a series of separate payments. If the Employer fails to so elect, the Employer must treat the installments as a single payment. Any election to treat installments as separate payments applies at all times with respect to the amount deferred. For purposes of this Section 4.02(B)(3), a “series of installment payments” means payment of a series of substantially equal periodic amounts to be paid over a predetermined number of years, except to the extent that any increase in the payment amounts reflects reasonable Earnings through the date of payment. For this purpose, a series of installment payments over a predetermined period and: (i) a series of installments over a shorter or longer period; and (ii) a series of installments over the same period but with a difference commencement date, are different times and methods of payment and a change in the predetermined period or commencement date is subject to this Section 4.02(B). An installment payment does not fail to be an installment solely because the plan provides for an immediate payment of all remaining installments if the present value of the Deferred Compensation to be paid in the remaining installments falls below a predetermined amount, and the immediate payment in not an acceleration under Section 4.02(C) provided that the payment election establishes this feature, including the predetermined amount triggering immediate payment and that any change to the feature is subject to this Section 4.02(B). If the Plan is a restated Plan, whatever election the Employer makes in it Adoption Agreement on or before December 31, 2007, applies to any period spanning 2005 through 2007, as applicable, unless the Employer indicates otherwise in its election.

Coordination with Anti-Acceleration Rule . The definition of “payment” in Sections 4.02(B)(2) and (3) also applies to Section 4.02(C). A change payment election may change the form of payment to a more rapid schedule (including a change from installments to a lump-sum payment) without violating Section 4.02(C), provided any such change remains subject to the change payment election provisions under this Section 4.02(B).

Multiple Payment Events . If the Plan permits multiple payment events, the change payment election provisions of Section 4.02(B)(1) apply separately as to each payment due upon each payment event. The addition or deletion of a permissible payment event to Deferred Compensation previously deferred is subject to the change election provisions of Section 4.02(B)(1) where the additional event may cause a change in the time or form of payment. However the addition of death, Disability or Unforeseeable Emergency as an “earliest of’ payment event is not a change payment election and is not an impermissible acceleration under Section 4.02(C).

Domestic Relations Orders . An election, pursuant to or reflected in a domestics relations order under Code §414(p)(1)(B), by someone other than the Participant, as to payments to a person other than the Participant, is not a change payment election subject to this Section 4.02(B).

Certain Payment Delays not Subject to Change Payment Election Rules . The Employer operationally will elect whether to apply the some or all of the following payment delay provisions. The Employer in applying such provisions must treat all payments to similarly situated service providers on a reasonably equivalent basis. If applicable, these provisions do not result in the Plan failing to provide for payment upon a permissible event as Code §409A requires nor are the delays treated as a change payment election under this Section 4.02(B).

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Adoption Agreement

Non-deductible Payment . The Plan may delay payment to a Participant if the Employer reasonably anticipates that the Employer’s deduction for the scheduled payment of the Participant’s Deferred Compensation will be barred under Code § 162(m). In such event, the Plan (without any Participant election as to timing) will pay such Deferred Compensation either in the Participant’s first Taxable Year in which the Employer reasonably anticipates or should reasonably anticipate that Code § 162(m) will not apply or during the period beginning on the date the affected Participant Separates from Service and ending on the later of the last day of the Participant’s Taxable Year in which the Separation occurs or the 15 ^th day of the third month following the Separation. If the Employer fails to delay under this Section 4.02(B)(7)(a) all scheduled payments during a Taxable Year which could be so delayed, the Employer’s delay of any payment is a change payment election subject to this Section 4.02(B). If the Employer delays payment until the Participant’s Separation from Service, the payment is considered as made based on Separation from Service for purpose of application of Section 4.01(D) and payment to a Specified Employee will be made on the date that is six months after Separation from Service.

Securities or Other Laws . The Plan may delay payment to a Participant if the Employer reasonably anticipates that the payment will violate Federal securities law or other applicable law. The Plan will pay such Deferred Compensation at the earliest date at which the Employer reasonably anticipates that the payment will not cause a violation of such laws. For purposes of this Section 4.02(B)(7)(b), a violation of “other applicable law” does not include a payment which would cause inclusion of the Deferred Compensation in the Participant’s gross income or which would subject the Participant to any Code penalty or other Code provision.

Change in Control . The Plan may delay payment to a Participant related to a Change in Control and that occur under the circumstances described in Treas. Reg. 1.409A-3(i)(5)(iv).

Other . The Plan may delay payment to a Participant upon such other events as Applicable Guidance may permit.

(8) Extension of Short-Term Deferral . A Participant who, after the deadline for an initial payment election under Section 4.02(A)(2)(a), makes an election to defer payment of an amount which, but for the election, would be a short-term deferral under Treas. Reg. 1.409A-I (b)(4) and not subject to 409A, makes a change payment election subject to this Section 4.02(B) and in applying Section 4.02(B), the Plan treats the scheduled payment date as the date the Substantial Risk of Forfeiture lapses; provided that a Participant making such an election may provide for payment upon a Change in Control without regard to the 5 year requirement under clause (ii) of Section 4.02(B)(1)(a).

No Acceleration .

General Rule . No person may accelerate the time or schedule of any Plan payment or amount scheduled to be paid under the Plan. For this purpose, the payment of an amount substituted for the Deferred Compensation is a payment of the Deferred Compensation, as provided in Treas. Reg. §1.409A-3(f).

Not an Acceleration . Certain actions as described in Treas. Reg. §§1.409A-3(j)(1), (2), (3), (5) and (6) are not an acceleration including: (i) certain payments made as a result of an intervening payment event and made in accordance with Plan provisions or pursuant to an initial payment election under Section 4.02(A) or a change payment election under Section 4.02(B); (ii) the Employer’s waiver or acceleration of the satisfaction of any condition constituting a Substantial Risk of Forfeiture provided that payment is made only upon a permissible payment event; (iii) the addition of death, Disability or Unforeseeable Emergency as payment events where such addition results in an earlier payment than would have occurred without the addition of such events (iv) an election to change Beneficiaries (including before the commencement of a life annuity) the if the time and form of payment does not change (except where under a life annuity a change in time of payments results solely from the different life expectancy of the new Beneficiary); (v) a decrease in the Compensation Deferred under the Plan as a result of certain linkage to qualified plans or broad-based

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Adoption Agreement

foreign plans or certain other actions or inactions, including related to Wraparound Elections; or (vi) a change to a cafeteria plan election (under Code § 125(d)) resulting in a change in the Compensation Deferred under this Plan.

Permissible Accelerations/ Including Cash-Out . Notwithstanding Section 4.02(C)(1), the Employer in its sole discretion and without any Participant discretion or election, operationally may elect accelerations of the time or schedule of payment from the Plan in any or all of the circumstances described in Treas. Reg. §§1.409A-3(j)(4)(ii) through (xiv). Such circumstances include, but are not limited to, the mandatory lump-sum payment of the Participant’s entire Vested Accrued Benefit at any time provided that the Employer evidences its discretion to make such payment in writing no later than the date of payment, the payment results in the termination and liquidation of the Participant’s interest under the Plan and under all Aggregated Plans, and the payment amount does not exceed the applicable dollar amount under Code §402(g)(1)(B). The Employer in applying this Section 4.02(C)(3) must treat all similarly situated service providers on a reasonably equivalent basis. See Section 6.03 as to Plan termination which also results in a permissible acceleration.

Withholding . The Employer will withhold from any payment made under the Plan and from any amount taxable under Code §409A, all applicable taxes, and any and all other amounts required to be withheld under Applicable Guidance.

Beneficiary Designation . A Participant may designate a Beneficiary (including one or more primary and contingent Beneficiaries) to receive payment of any Vested Accrued Benefit remaining in the Participant’s Account at death. The Employer will provide each Participant with a form for this purpose and no designation will be effective unless made on that form and delivered to the Employer. A Participant may modify or revoke an existing designation of Beneficiary by executing and delivering a new designation to the Employer. In the absence of a properly designated Beneficiary, the Employer will pay a deceased Participant’s Vested Accrued Benefit to the Participant’s surviving spouse and if none, to the Participant’s then living lineal descendants, by right of representation, and if none, to the Participant’s estate. If a Beneficiary is a minor or otherwise is a person whom the Employer reasonably determines to be legally incompetent, the Employer may cause the Plan or Trust to pay the Participant’s Vested Accrued Benefit to a guardian, trustee or other proper legal representative of the Beneficiary. The Plan’s or Trust’s payment of the deceased Participant’s Vested Accrued Benefit to the Beneficiary or proper legal representative of the Beneficiary completely discharges the Employer, the Plan and Trust of all further obligations under the Plan.

Payments Treated as Made on Payment Date .

Certain Late Payments . The Plan’s payment of Deferred Compensation is deemed made on the Plan required payment date or payment election required payment date even if the Plan makes payment after such date, provided the payment is made by the latest of: (i) the end of the Taxable Year in which the payment is due; (ii) the 15 ^`h day of the third calendar month following the payment due date provided that the Participant is not able, directly or indirectly, to designate the Taxable Year of payment; (iii) in case the Employer cannot calculate the payment amount on account of administrative impracticality which is beyond the Participant’s control (or the control of the Participant’s Beneficiary), in the first Taxable Year of the Participant in which payment is practicable; (iv) in case the making of the payment on the specified date would jeopardize the Employer’s ability to continue as a going concern, in the first Taxable Year of the Participant in which the payment would not have such effect. The Employer may cause the Plan or Trust to pay a Participant’s Vested Accrued Benefit on any date which satisfies this Section 4.05(A) and that is administratively practicable following any Plan specified payment date or the date specified in any valid payment election.

Change in Control . In the case of certain Change in Control events, as described in Treas. Reg. §1.409A-3(i)(5)(iv), certain transaction based compensation paid on the same schedule and on the same terms as apply to shareholders generally with respect the Employer’s stock or as the payments to the Employer, is treated as paid on the designated payment date. Further, such payments made within 5 years after the Change in Control event are deemed compliant with Sections 4.02(A) and (B).

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Nonqualified Deferred Compensation Plan

Adoption Agreement

Disputed Payments . In the event of a dispute between the Employer and a Participant as to whether Deferred Compensation is payable to the Participant or as to the amount thereof, or any other failure to pay, payment is treated as paid on the designated payment date if such payment is made in accordance with Treas. Reg. §1.409A-3(g).

Early Payments . The Employer also may cause the Plan or Trustee to pay on a date no earlier than 30 days before the specified payment date provided the Participant is not able, directly or indirectly, to designate the Taxable Year of the payment. Such “early” payments are not an accelerated payment under Section 4.02(C).

Payment Election Requirements . The term “payment election,” for purposes of this Section 4.06(B) and the Plan generally, means either an initial payment election under Section 4.02(A) or a change payment election under Section 4.02(B).

Compliance with Plan Terms . All initial payment elections and change payment elections must be consistent with the Plan and with the Adoption Agreement.

When Election is Considered Made; Irrevocability .

Participant Elections . A Participant’s payment election is not considered made for any purpose under the Plan until both: (i) the Employer approves the election; and (ii) the election has become irrevocable. A Participant’s payment election is always revocable until the Employer accepts the election, which acceptance must occur within the time period described in Section 4.06(C). A Participant’s payment election becomes irrevocable as the Employer elects in its Adoption Agreement.

Employer Elections . The Employer’s payment election is not considered made for any purpose under the Plan until the election has become irrevocable. The Employer’s initial payment election is irrevocable after the last permissible date for making the election under Section 4.02(A)(2)(b). The Employer’s change payment election relating to payment at a Specified Time or pursuant to a Fixed Schedule is irrevocable after the last permissible date for making the election under Section 4.02(B)(1)(a). The Employer’s change payment election relating to payment based on any other payment event (not a Specified Time or Fixed Schedule) remains revocable for 30 days following the Employer’s execution of the change payment election.

Effect of Changes While Election is Revocable . Any change made to a payment election while the election remains revocable is not a change payment election, either for purposes of Section 4.02(B)(1)(a) timing rules or in applying any Plan limit on the number of change payment elections a Participant may make as to any amount of Deferred Compensation. Any modification to a payment election after the election has become irrevocable is a change payment election (if made with respect to an initial payment election) or is a new change payment election (if made with respect to a change payment election).

Continuing Elections . If an initial payment election is continuing under Section 4.02(A)(3), such that it applies to Compensation Deferred in one or more Taxable Years beginning after the first Taxable Year to which the payment election applies, the payment election is revocable as to such future Taxable Years until the last permissible date under Section 402(A)(2)(b) for making the election with regard to such future Taxable Year or Years.

Employer Approval of Participant and Beneficiary Elections . The Employer expressly and in writing must approve any Participant or Beneficiary payment election as to timing, form and medium, even if the Plan and Adoption Agreement permit such election. The Employer, in its absolute discretion, may withhold approval for any reason, including, but not limited to, non-compliance with Plan terms. However, the Employer must approve or reject any such election within the time period during which the Participant or Beneficiary would have had to make the election. If the Employer does not so approve or reject a payment election, the election is deemed rejected within such time period. With regard to initial payment elections, unless the Participant subsequently makes a timely initial payment election the

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Nonqualified Deferred Compensation Plan

Adoption Agreement

Employer accepts, the Employer will pay the Participant’s Vested Accrued Benefit under the payment event, timing, form and medium default provisions of Sections 4.01(B) and 4.02(A)(5).

Preservation of Pre-2008 Payment Elections . If the Plan is a restatement of a Plan which was in effect before January 1, 2008, as to pre-2008 Deferred Compensation (and Earnings thereon) which is a 409A Amount, the Plan preserves any 409A permissible payment elections under the Plan which elections are not available under the Plan as to Compensation Deferred after 2007, subject to any change payment election made as to such pre-2008 Deferred Compensation.

Trust Election and Plan Earnings

Unfunded Plan . The Employer as it elects in its Adoption Agreement intends this Plan to be an unfunded plan that is wholly or partially exempt under ERISA. No Participant, Beneficiary or successor thereto has any legal or equitable right, interest or claim to any property or assets of the Employer, including assets held in any Account under the Plan except as the Plan otherwise permits. The Employer’s obligation to pay Plan benefits is an unsecured promise to pay. Any assets held in Plan Accounts remain subject to claims of the Employer’s general creditors and no Participant’s or Beneficiary’s claim to Plan assets has any priority over any general unsecured creditor of the Employer. Except as otherwise provided in the Plan or Trust, all Plan assets, including all incidents of ownership thereto, at all times will be the sole property of the Employer.

No Trust . Except as provided in its Adoption Agreement, this Plan does not create a trust for the benefit of any Participant. If the Employer does not establish the Trust: (i) the Employer may elect to make notional contributions in lieu of actual contributions to the Plan; and (ii) the Employer may elect not to invest any actual Plan contributions. If the Employer elects to invest any actual Plan contributions, such investments may be held for the Employer’s benefit in providing for the Employer’s obligations under the Plan or for such other purposes as the Employer may determine.

Earnings . If the Employer does not establish the Trust, the Employer will elect in its Adoption Agreement whether the Plan periodically will credit actual or notional Plan contributions with a determinable amount of notional Earnings (at a specified fixed or floating interest rate or other specified index) or will credit or charge each Participant’s Account with the Earnings actually incurred by the Account.

Investment Direction . If the Account is credited and charged with actual Earnings, the Employer will specify in the Adoption Agreement whether the Employer or the Participant has the right to direct the investment of the Participant’s Account and also may specify any limitations on the Participant’s right of investment direction. If the Adoption Agreement provides for Employer investment direction, the Employer may make any investment of Plan assets it deems reasonable or appropriate. If the Adoption Agreement provides for Participant investment direction, this right is limited strictly to investment direction and the Participant will not be entitled to the distribution of any Account asset except as the Plan otherwise permits.

Trust . If the Employer elects in its Adoption Agreement to create the Trust, the applicable provisions of the Basic Plan Document continue to apply, including those of Section 5.01. The Trustee will pay Plan benefits in accordance with the Plan terms or upon the Employer’s direction consistent with Plan terms.

Restriction on Trust Assets . If an Employer establishes, directly or indirectly, the Trust (or any other arrangement Applicable Guidance may describe), the Trust and the Trust assets must be and must remain located within the United States, except with respect to a Participant who performs outside the United States substantially all services giving rise to the Deferred Compensation. The Trust may not contain any provision limiting the Trust assets to the payment of Plan benefits upon a Change in the Employer’s Financial Health, even if the assets remain subject to claims of the Employer’s general creditors. For this purpose, the Employer, upon a Change in the Employer’s Financial Health, may not transfer Deferred Compensation to the Trust. The Employer (and any member of a controlled group which includes the Employer) during the “restricted period” also may not transfer Deferred Compensation to the Trust and the

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Nonqualified Deferred Compensation Plan

Adoption Agreement

Trust may not be restricted to payment of Plan benefits, to the extent that such transfer or restriction would violate the at-risk limitation of Code §409A(b)(3). Any Trust the Employer establishes under this Plan shall be further subject to Applicable Guidance, compliance with which is necessary to avoid the transfer of assets to the Trust being treated as a transfer of property under Code §83.

Trust Earnings and Investment . If the Employer establishes the Trust, the Trust earnings provisions apply to all Plan contributions and constitute Earnings for purposes of the Plan. The Trustee will invest the assets held in the Trust in accordance with the Trust terms but are not subject to Participant direction of investment.

Miscellaneous

No Assignment . No Participant or Beneficiary has the right to anticipate, alienate, assign, pledge, encumber, sell, transfer, mortgage or otherwise in any manner convey in advance of actual receipt, the Participant’s Account. Prior to actual payment, a Participant’s Account is not subject to the debts, judgments or other obligations of the Participant or Beneficiary and is not subject to attachment, seizure, garnishment or other process applicable to the Participant or Beneficiary.

Not Employment Contract . This Plan is not a contract for employment between the Employer and any Employee who is a Participant. This Plan does not entitle any Participant to continued employment with the Employer, and benefits under the Plan are limited to payment of a Participant’s Vested Accrued Benefit in accordance with the terms of the Plan.

Amendment and Termination .

Amendment . The Employer reserves the right to amend the Plan at any time to comply with Code §409A, Treas. Reg. §1.409A and other Applicable Guidance or for any other purpose, provided that such amendment will not result in taxation to any Participant under Code §409A. Except as the Plan and Applicable Guidance otherwise may require, the Employer may make any such amendments effective immediately.

Termination . The Employer may terminate, but is not required to terminate and liquidate the Plan which includes the distribution of all Plan Accounts under the following circumstances:

Dissolution/Bankruptcy . The Employer may terminate and liquidate the Plan within 12 months following a dissolution of a corporate Employer taxable under Code §331 or with approval of a Bankruptcy court under 11 U.S.C. §503(b)(l)(A), provided that the Deferred Compensation is paid to the Participants and is included in the Participants’ gross income in the latest of (or, if earlier, the Taxable Year in which the amount is actually or constructively received): (i) the calendar year in which the plan termination and liquidation occurs; (ii) the first calendar year in which the amounts no longer are subject to a Substantial Risk of Forfeiture; or (iii) the first calendar year in which the payment is administratively practicable.

Change in Control . The Employer may terminate and liquidate the Plan by irrevocable action taken within the 30 days preceding or the 12 months following a Change in Control, provided the Employer distributes all Plan Accounts (and must distribute the accounts under any Aggregated Plans which plan the Employer also must terminate and liquidate as to each Participant who has experienced the Change in Control) within 12 months following the date of Employer’s irrevocable action to terminate and liquidate the Plan and Aggregated Plans. Where the Change in Control results from an asset purchase transaction, the “Employer” with discretion to terminate and liquidate the Plan is the Employer that is primarily liable after the transaction to pay the Deferred Compensation.

Other . The Employer may terminate the Plan for any other reason in the Employer’s discretion provided that: (i) the termination and liquidation does not occur proximate to a downturn in the Employer’s financial health; (ii) the Employer also terminates all Aggregated Plans in which any Participant also is a participant; (ii) the Plan makes no payments in the 12 months following the date of Employer’s irrevocable action to terminate and liquidate the Plan other

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Nonqualified Deferred Compensation Plan

Adoption Agreement

than payments the Plan would have made irrespective of Plan termination; (iii) the Plan makes all payments within 24 months following the date of Employer’s irrevocable action to terminate and liquidate the Plan; and (iv) the Employer within 3 years following the date of Employer’s irrevocable action to terminate and liquidate the Plan does not adopt a new plan covering any Participant that would be an Aggregated Plan.

Applicable Guidance . The Employer may terminate and liquidate the Plan under such other circumstances as Applicable Guidance may permit.

Effect on Vesting . Any Plan amendment or termination will not reduce the Vested Accrued Benefit held in any Participant Account at the date of the amendment or termination and will not accelerate vesting except as the Employer may expressly provide for in connection with the amendment or termination, provided that any such vesting acceleration does not subject any Participant to taxation under Code §409A.

Cessation of Future Contributions . The Employer in its Adoption Agreement may elect at any time to amend the Plan to cease future Elective Deferrals, Nonelective Contributions or Matching Contributions as of a specified date. In such event, the Plan remains in effect (except those provisions permitting the frozen contribution type) until all Accounts are paid in accordance with the Plan terms, or, if earlier, upon the Employer’s termination of the Plan.

Fair Construction . The Employer, Participants and Beneficiaries intend that this Plan in form and in operation comply with Code 409A, the regulations thereunder, and all other present and future Applicable Guidance. The Employer and any other party with authority to interpret or administer the Plan will interpret the Plan terms in a manner which is consistent with Applicable Law. However, as required under Treas. Reg. §1.409A-1(c)(1), the “interpretation” of the Plan does not permit the deletion of material terms which are expressly contrary to Code §409A and the regulations thereunder and also does not permit the addition of missing terms necessary to comply therewith. Such deletions or additions may be accomplished only be means of a Plan amendment under Section 6.03(A). Any Participant, Beneficiary or Employer permitted Elective Deferral election, initial payment election, change payment election or any other Plan permitted election, notice or designation which is not compliant with Applicable Law is not an “election” or other action under the Plan and has no effect whatsoever. In the event that a Participant, Beneficiary or the Employer fail to make an election or fail to make a compliant election, the Employer will apply the Plan’s default terms under Sections 4.01(B) and 4.02(A)(5).

Notice and Elections . Any notice given or election made under the Plan must be in writing and must be delivered or mailed by certified mail, to the Employer, the Trustee or to the Participant or Beneficiary as appropriate. The Employer will prescribe the form of any Plan notice or election to be given to or made by Participants. Any notice or election will be deemed given or made as of the date of delivery, or if given or made by certified mail, as of 3 business days after mailing.

Administration . The Employer will administer and interpret the Plan, including making a determination of the Vested Accrued Benefit due any Participant or Beneficiary under the Plan. As a condition of receiving any Plan benefit to which a Participant or Beneficiary otherwise may be entitled, a Participant or Beneficiary will provide such information and will perform such other acts as the Employer reasonably may request. The Employer may cause the Plan to forfeit any or all of a Participant’s Vested Accrued Benefit, if the Participant fails to cooperate reasonably with the Employer in the administration of the Participant’s Plan Account, provided that this provision does not apply to a bona fide dispute under Section 4.05(A)(2). The Employer may retain agents to assist in the administration of the Plan and may delegate to agents such duties as it sees fit. The decision of the Employer or its designee concerning the administration of the Plan is final and is binding upon all persons having any interest in the Plan. The Employer will indemnify, defend and hold harmless any Employee designated by the Employer to assist in the administration of the Plan from any and all loss, damage, claims, expense or liability with respect to this Plan (collectively, “claims”) except claims arising from the intentional acts or gross negligence of the Employee.

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Nonqualified Deferred Compensation Plan

Adoption Agreement

Account Statements . The Employer from time to time will provide each Participant with a statement of the Participant’s Vested Accrued Benefit as of the most recent Valuation Date. The Employer also will provide Account statements to any Beneficiary of a deceased Participant with a Vested Accrued Benefit remaining in the Plan. Any such statements are for information purposes only prior to an actual Plan payment, are subject to adjustment or correction, and are not binding upon the Employer.

Accounting . The Employer will maintain for each Participant as is necessary for proper administration of the Plan, an Elective Deferral Account, a Matching Contribution Account, a Nonelective Contribution Account, and separate sub-accounts reflecting 409A Amounts and Grandfathered Amounts in accordance with Section 7.03.

Costs and Expenses . Investment charges which will be borne by the Account to which they pertain. The Employer will pay the other costs, expenses and fees associated with the operation of the Plan, excluding those incurred by Participants or Beneficiaries. The Employer will pay costs, expenses or fees charged by or incurred by the Trustee only as provided in the Trust or other agreement between the Employer and the Trustee.

Reporting . The Employer will report Deferred Compensation for Employee Participants on Form W-2 for and on Form 1099-MISC for Contractor Participants in accordance with Applicable Guidance.

ERISA Claims Procedure . If this Plan is established as a “top-hat plan” within the meaning of DOL Reg. §2520.104-23, the following claims procedure under DOL Reg. §2560.503-1 applies. For purposes of the Plan’s claims procedure under this Section 6.11, the “Plan Administrator” means the Employer. A Participant or Beneficiary may file with the Plan Administrator a written claim for benefits, if the Participant or Beneficiary disputes the Plan Administrator’s determination regarding the Participant’s or Beneficiary’s Plan benefit. However, the Plan Administrator will cause the Plan to pay only such benefits as the Plan Administrator in its discretion determines a Participant or Beneficiary is entitled to receive. The Plan Administrator under this Section 6.11 will provide a separate written document to affected Participants and Beneficiaries which explains the Plan’s claims procedure and which by this reference is incorporated into the Plan. If the Plan Administrator makes a final written determination denying a Participant’s or Beneficiary’s claim, the Participant or Beneficiary must file an action with respect to the denied claim within 180 days following the date of the Plan Administrator’s final determination.

409A Amounts and Grandfathered Amounts

409A Amounts . The terms of this Plan control as to any 409A Amount.

Grandfathered Amounts . A Grandfathered Amount remains subject to the terms of the Plan as in effect before January 1, 2005, unless the Employer makes a material modification to the Plan as described in Treas. Reg. §1.409A-6(a)(4).

Separate Accounting/Earnings . The Employer will account separately for 409A Amounts and for Grandfathered Amounts within each Participant’s Account. The Employer also will account separately for Earnings on the 409A Amounts and Earnings on the Grandfathered Amounts. Post-2004 Earnings on Grandfathered Amounts are included in the Grand fathered Amount.

* * * * * * * * * * * * * * *

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Exhibit 31.1

CERTIFICATION

I, Anders Gustafsson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Zebra Technologies Corporation;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and the internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this quarterly report based on such evaluation; and

d) Disclosed in this quarterly report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: April 30, 2008	By:	/s/ Anders Gustafsson
		Anders Gustafsson
		Chief Executive Officer

Exhibit 31.2

CERTIFICATION

I, Charles R. Whitchurch, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Zebra Technologies Corporation;

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: April 30, 2008	By:	/s/ Charles R. Whitchurch
		Charles R. Whitchurch
		Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Zebra Technologies Corporation (Zebra) on Form 10-Q for the period that ended March 29, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Anders Gustafsson, Chief Executive Officer of Zebra, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of Zebra.

A signed original of this written statement required by Section 906, or another document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Zebra and will be retained by Zebra and furnished to the Securities and Exchange Commission or its staff upon request.


Date: April 30, 2008	By:	/s/ Anders Gustafsson
		Anders Gustafsson
		Chief Executive Officer

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Zebra Technologies Corporation (Zebra) on Form 10-Q for the period that ended March 29, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Charles R. Whitchurch, Chief Financial Officer of Zebra, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of Zebra.


Date: April 30, 2008	By:	/s/ Charles R. Whitchurch
		Charles R. Whitchurch
		Chief Financial Officer