Exhibit 10.1

 

STOCK OPTION AGREEMENT

 

THIS STOCK OPTION AGREEMENT dated as of                                  (“Grant
Date”), is between ZEBRA TECHNOLOGIES CORPORATION, a Delaware corporation (the
“Company”), and                                  (the “Participant”).

 

WHEREAS, the Company desires, by affording the Participant an opportunity to
purchase shares of the Company’s Class A Common Stock, par value $.01 per share
(the “Common Stock”), as hereinafter provided, to carry out the purposes of the
ZEBRA TECHNOLOGIES CORPORATION 1997 STOCK OPTION PLAN (the “Plan”); and

 

WHEREAS, the Committee has duly made all determinations necessary or appropriate
to the grants hereunder;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth and for other good and valuable consideration, receipt of
which is hereby acknowledged, the parties hereto have agreed, and do hereby
agree, as follows:

 

1.             Grant of Option, Option Price and Term.

 

(a)           The Company hereby grants to the Participant, as a matter of
separate agreement and not in lieu of salary or any other compensation for
services, the right and option (the “Option”) to purchase
                           shares of the Common Stock of the Company (“Option
Shares”) on the terms and conditions herein set forth.

(b)           For each of the Option Shares purchased, the Participant shall pay
to the Company $                       per share (the “Option Price”). 
Accordingly, the aggregate Option Price to exercise all of the Option is
$                         .

(c)           The term of this Option shall be a period of ten (10) years from
the Grant Date (the “Option Period”).  During the Option Period, the Option
shall be exercisable in accordance with the following schedule:

 

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

 

15

%

 

 

 

 

On or after the second anniversary of the Grant Date

 

17.5

%

 

 

 

 

On or after the third anniversary of the Grant Date

 

20

%

 

 

 

 

On or after the fourth anniversary of the Grant Date

 

22.5

%

 

 

 

 

On or after the fifth anniversary of the Grant Date

 

25

%

 

Notwithstanding the foregoing, in the event the Participant incurs a Termination
of Employment due to death or Disability as an employee of the Company or an
Affiliate but prior to the fifth anniversary of the Grant Date, all or any
portion of the Option which is not exercisable on the date immediately
proceeding the date the Participant incurs a Termination of Employment due to
death or Disability shall become exercisable on or after the date the
Participant incurs a Termination of Employment due to death or Disability.

 

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(d)           The Option granted hereunder is designated as a nonqualified stock
option.

(e)           The Company shall not be required to issue any fractional Option
Shares.

 

2.             Termination of Option.

Subject to Section 1(c):

 

(a)           If a Participant has an involuntary (as to the Participant)
Termination of Employment for reasons other than Cause, Disability or death,
this Option shall be canceled ninety (90) days after the date of such
Termination of Employment or after the remaining Option Period, if shorter.

(b)           If a Participant has a Termination of Employment due to
Retirement, this Option shall be canceled one year after the date of such
Termination of Employment or after the remaining Option Period, if shorter. For
this purpose, Retirement means the Participant’s Termination of Employment after
attaining either (i) age 55 with the accrual of 10 years of service, or (ii) age
65.

(c)           If the Termination of Employment is on account of the Disability
or death of the Participant, this Option shall be canceled one year after the
date of the termination of employment or the appointment of a Representative in
the case of death or after the remaining Option Period, if shorter.

(d)           If the Participant has a voluntary Termination of Employment
(other than due to Retirement), this Option will be canceled thirty (30) days
after the date of such Termination of Employment.

(e)           If the Participant has a Termination of Employment for Cause, this
Option will automatically be canceled simultaneously with the date of such
Termination of Employment.

A Participant’s Termination of Employment due to death or Disability will result
in the Option’s being fully exercisable.  A Participant’s Termination of
Employment due to other than death or Disability does not accelerate the
percentage of the Option otherwise exercisable with respect to the Participant. 
Any portion of the Option which is not exercisable as of a Participant’s
Termination of Employment other than due to death or Disability is canceled
simultaneously with the date of such Termination of Employment.

 

3.             Exercise.

The Option shall be exercisable during the Participant’s lifetime only by the
Participant (or his or her Representative), and after the Participant’s death
only by a Representative.  The Option may only be exercised by the delivery to
the Company of a properly completed written notice, in form satisfactory to the
Committee, which notice shall specify the number of Option Shares to be
purchased and the aggregate Option Price for such shares, together with payment
in full of such aggregate Option Price.  Payment shall only be made:

 

(a)           in cash or by check;

(b)           by the delivery to the Company of a valid and enforceable stock
certificate (or certificates) representing shares of Common Stock already owned
by the Participant for a period of at least six (6) months prior to such
payment;

(c)           if the Committee shall so permit, by delivery to the Company of a
full recourse promissory note or other full recourse evidence of indebtedness;

(d)           by authorizing the Company to retain shares of Common Stock,
thereby reducing the number of shares of Common Stock to be issued and delivered
to the Participant upon such exercise;

(e)           if the Committee shall so permit, by a “cashless” exercise as
described in the Plan; or

(f)            in any combination of (a), (b), (c), (d) or (e).

 

If any part of the payment of the Option Price is made in shares of Common
Stock, such shares shall be valued by using their Fair Market Value as of their
date of delivery.

 

The Option shall not be exercised unless there has been compliance with all the
preceding provisions of this Section 3, and, for all purposes of this Stock
Option Agreement, the date of the exercise of the Option shall be the date upon
which there is compliance with all such requirements.  The Committee may deny
any method of exercise permitted hereunder if such method would result in
liability under federal securities law to the Participant or the Company or
result in an expense charge to the Company.

 

4.             Payment of Withholding Taxes.

If the Company is obligated to withhold an amount on account of any tax imposed
as a result of the exercise of the Option, the Participant shall be required
to pay such amount to the Company, as provided in the Plan.

 

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The Participant acknowledges and agrees that he or she is responsible for the
tax consequences associated with the grant of the Option and its exercise.

 

5.             Requirements of Law; Registration and Transfer Requirements.

The Company shall not be required to sell or issue any shares under the Option
if the issuance of such shares shall constitute a violation of any provision of
any law or regulation of any governmental authority.  This Option and each and
every obligation of the Company hereunder are subject to the requirement that
the Option may not be exercised or performed, in whole or in part, unless and
until the Option Shares are listed, registered or qualified, properly marked
with a legend or other notation, or otherwise restricted, as is provided for in
the Plan or required by the Committee.

 

6.             Changes in Company’s Capital Structure.

The existence of an Option will not affect in any way the right or authority of
the Company or its stockholders to make or authorize (a) any or all adjustments,
recapitalizations, reorganizations or other changes in the Company’s capital
structure or its business; (b) any merger or consolidation of the Company’s
capital structure or its business; (c) any merger or consolidation of the
Company; (d) any issue of bonds, debentures, preferred or prior preference stock
ahead of or affecting the Common Stock or the rights thereof; (e) the
dissolution or liquidation of the Company; (f) any sale or transfer of all or
any part of its assets or business; or (g) any other corporate act or
proceeding, whether of a similar character or otherwise.  In the event of a
Change in Control or other corporate restructuring provided for in the Plan, the
Participant shall have such rights, and the Committee shall take such actions,
as are provided for in the Plan.

 

7.             Nontransferability.

The Option and any interest in the Option may not be sold, assigned, conveyed,
gifted, pledged, hypothecated or otherwise transferred in any manner other than
by will or the laws of descent and distribution.  Notwithstanding any other
provision of this Stock Option Agreement, any such attempted sale, assignment,
conveyance, gift, pledge, hypothecation or transfer shall be null and void and
shall nullify the Option immediately.

 

8.             Plan.

Notwithstanding any other provision of this Stock Option Agreement, the Option
is granted pursuant to the Plan, as in effect on the date hereof, and is subject
to all the terms and conditions of the Plan, as the same may be amended from
time to time.  The interpretation and construction by the Committee of the Plan,
this Stock Option Agreement, the Option, and such rules and regulations as may
be adopted by the Committee for the purpose of administering the Plan, shall be
final and binding upon the Participant.  Until the Option shall expire,
terminate or be exercised in full, the Company shall, upon written request
therefor, send a copy of the Plan, in its then-current form, to the Participant
or any other person or entity then entitled to exercise the Option. Participant
hereby acknowledges receipt of a copy of the Plan.

 

9.             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.

 

10.           Confidentiality, Non-Solicitation and Non-Compete

Participant agrees to, understands and acknowledges the following:

 

(a)           Participant will be furnished, use or otherwise have access to
certain “Confidential Information” of the Company.  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, (i) 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; (ii) inventions, designs, methods, discoveries, works
of authorship, creations, improvements or ideas developed or otherwise produced,
acquired

 

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or used by the Company; (iii) 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; (iv) 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 (v) 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.

 

(b)           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 that 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.

 

(c)           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.

 

(d)           For the period beginning on the date hereof and ending twelve
months following the termination of employment with the Company, Participant
will not directly or indirectly (a) employ, recruit or solicit for employment
any person who is (or was within six months prior to Participant’s employment
termination date) an employee of the Company or (b) 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 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 as to whom the Company has a protectible proprietary
interest.

 

(e)           If Participant violates the terms of the Agreement, in addition to
all other remedies available under law or equity, the Company shall be entitled
to injunctive relief, issued by any court of competent jurisdiction, enjoining
Participant and each and every party connected with such violation from the
continuance of such violation.  Accordingly, Participant agrees to submit to the
jurisdiction of the courts of Illinois in relation to any violation by
Participant of the terms of this agreement or matters subject to enforcement
hereunder.

 

(f)            Notwithstanding the terms and conditions of Section 10(e) (above,
if Participant violates the terms of this Section 10 at any time, Participant,
without any further action by the Company or Participate, 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 Company’s rights under this Section 10(f).  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 to the Company under this Section 10.  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

 

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owes to the Company, calculated as set forth in this paragraph, Participant
agrees to pay immediately the unpaid balance to the Company.

 

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

 

11.           Employment Rights.

No provision of this Stock Option Agreement or of the Option granted hereunder
shall give the Participant any right to continue in the employ of the Company or
any Company Affiliates, create any inference as to the length of employment of
the Participant, affect the right of the Company or Company Affiliates to
Terminate the Employment 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 of the Company
Affiliates.

 

12.           Disclosure Rights.

The Company shall have no duty or obligation to affirmatively disclose to the
Participant or a Representative, and the Participant or Representative shall
have no right to be advised of, any material information regarding the Company
or an Affiliate at any time prior to, upon or in connection with the exercise of
an Option or the Company’s purchase of Common Stock in accordance with the terms
of this Stock Option Agreement.

 

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

 

14.           Governing Law.

This Stock Option Agreement and the Option granted hereunder shall be governed
by, and construed and enforced in accordance with, the laws of the State of
Illinois (other than its laws respecting choice of law) except to the extent the
General Corporation Law of the State of Delaware would be mandatorily
applicable.

 

15.           Entire Agreement.

This Stock 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.

 

16.           Definitions.

Wherever initial capitalization of a term is used in this Stock Option
Agreement, it shall have the same meaning as that given to it by the Plan,
except to the extent such meaning should conflict with any meaning afforded to
such term in this Stock Option Agreement.

 

17.           Amendment.

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

 

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

 

19.           Counterparts.

This Stock 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.

 

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20.           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 his address as shown on the Company’s
payroll records, or to such other address as the Participant, by notice to the
Company, may designate in writing from time to time.

 

21.           Headings.

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

 

22.           Severability.

If any provision of this Stock Option Agreement shall for any reason be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
effect any other provision hereof, and this Stock Option Agreement shall be
construed as if such invalid or unenforceable provision were omitted.

 

23.           Successors and Assigns.

This Stock 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 or a Representative, and all rights granted to the Company
hereunder, shall be binding upon the Participant’s or the Representative’s
heirs, legal representatives and successors.

 

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

 

On Behalf of the Option Committee

Participant:

 

 

 

 

Charles R. Whitchurch

 

 

 

Chief Financial Officer

 

 

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