**CONFIDENTIAL**
 
 October
25, 2004
 
 Milos
Djokovic
 7730
Running Fox Way
 Parker,
Colorado 80134
 
 **Re:
Offer of Employment - Zi Corporation of America, Inc.**
 
 Dear
Milos:
 
 I am
pleased to herein offer you employment with Zi Corporation of America, Inc.
under the following terms and conditions.
 
 This
agreement will be between Zi Corporation of America, Inc. (hereafter called the
“Corporation”) and yourself (hereafter called the “Employee”). On acceptance of
the following terms and conditions, a Confidentiality and Non-Competitive
Agreement will be executed by both parties.
 
 **1.**
    **Position** In this
position of COO and CTO of Zi Corporation and the Corporation, the Employee will
report to Mike Donnell, the CEO. Until further notice the principal place of
business for this position is the Denver, Colorado metropolitan
area.
 
 **2.**
    **Terms** This
agreement shall be effective October 15, 2004, or such earlier date as the
parties may agree upon as practicable for the Employee. During the first three
months of this agreement either party may terminate this agreement upon one
month’s without notice or payment in lieu of notice. After the 3-month period,
if the Corporation terminates your employment for a reason other than wrongful
conduct on your part, then you will be entitled to 6 months of salary, and
maintenance of benefits for 6 months.
 
 **3.**
    **Duties
      and Responsibilities** Subject
to reasonable direction from the Employee’s direct report and other senior
management, the Employee shall travel to locations as defined by the
CEO.
 
 These
duties and responsibilities are not exhaustive and may be changed at the
Corporation’s discretion. In this regard, the Employee may not refuse any
reasonable employment request by the Corporation. However, the Corporation
agrees that it will not change your job title or executive status without your
mutual agreement.
 
 **4.**
    **Compensation** The
Employee’s base salary will be USD$230,000 per annum payable in twenty-four
equal instalments in arrears on the 15 th and last
day of the month. The Employee may be granted a bonus based on a target of 15%,
as shall be determined in the sole discretion of the board of directors, which
can be earned based upon performance goals set by the board of directors,
payable in cash, or, if mutually agreed to Restricted Share Units or
options.
 
 Subject
to regulatory approval, the Employee will be granted 230,000 options in Zi
Corporation at US$3.40. The options will vest as follows:  1/3 of
the options to vest six (6) months from date of grant, and 1/3 to vest twelve
(12) months from date of grant, and 1/3 to vest twenty-four (24) months from
date of grant.  Upon
change of control the vesting of all unvested stock options will accelerate.
Following the termination of employment for any reason other than
 just
cause, you shall have 90 days to exercise any vested stock options, or such
other period of time as may be required by regulatory authorities.
 
 
 ****
 ****5.**
    **Reimbursement
      of Expenses**** The
Corporation shall reimburse the Employee for all Corporation authorized business
expenses incurred by the Employee, in the course of employment provided that
such expenses are reasonable and are supported by reasonable written
documentation such as invoices and receipts where possible.
 
 **6.**
    **Holiday
      Entitlement** a)
    In
      addition to statutory holidays, the Employee is entitled to 15 working
      days non-cumulative vacation each year. b)
    It
      is understood and agreed that any ordinary vacation is subject to
      reasonable control over scheduling by the
Corporation. 
 **7.**
    **Benefits** As a
condition of employment, the Employee will participate in the Corporation’s
group benefits plan, subsequent to the plan’s three-month waiting
period.
 
 **8.**
    **Policies** The
Employee agrees to be bound by and to follow all workplace and employment
policies of the Corporation, as such may be implemented or changed from time to
time by the Corporation. The various policies will be made available to the
Employee.
 
 As
mentioned above, a condition of this Offer of Employment is the execution of a
Confidentiality and Non-Competition Agreement that will be prepared and
forwarded to you upon receipt of a signed copy of this Offer of
Employment.
 
 Should
the terms and conditions be agreeable to you, please execute a copy of this
letter and fax to the Office Administrator at (403) 231-4596.
 
 Yours
truly,
 **Zi
Corporation of America, Inc.**
  
 Mike
Donnell
 President
and CEO
 
 I hereby
accept the terms and conditions of this Offer of Employment as set out
herein.
 
 **__________________________**    **____________________**
 **Name** **Date**