8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): January 11, 2007

ZEBRA TECHNOLOGIES CORPORATION

(Exact Name of Registrant as Specified in Charter)

Delaware	000-19406	36-2675536
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
333 Corporate Woods Parkway, Vernon Hills, Illinois		60061
(Address of Principal Executive Offices)		(Zip Code)

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

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13c-4(c))

Item 1.01 Entry into a Definitive Material Agreement.

The Merger Agreement

On January 11, 2007, Zebra Technologies Corporation, a Delaware corporation (“Zebra”), Waldo Acquisition Corp., a California corporation (“Merger Sub”), WhereNet Corp., a California corporation (the “Company”) and Crosspoint Venture Partners 1996, LLP (the “Shareholders’ Representative”), entered into an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement provides that, upon the terms and subject to the conditions set forth in the Merger Agreement, Zebra will acquire all of the capital stock of the Company through a merger of Merger Sub with and into the Company (the “Merger”), with the Company continuing as the surviving corporation.

At the effective time and as a result of the Merger, the purchase price to be paid by Zebra at closing is $126.0 million in cash, less applicable post-closing price adjustments, if any, as set forth in the Merger Agreement and subject to an escrow amount of $13.6 million to be deposited on behalf of the Company’s shareholders pursuant to the terms of an Escrow Agreement to be executed on the closing date, by Zebra, the Shareholders’ Representative and the escrow agent. The escrow will be distributed in one year, except for amounts reserved for claims pending at such time. In the Merger, (i) each issued and outstanding share of Company series A-1 preferred stock and warrants exercisable for shares of Company series A-1 preferred stock will be converted into the right to receive $1.68 per share, less any applicable exercise price (after payment of all Company transaction expenses, approximately $37 million) and (ii) each issued and outstanding share of Company common stock, Company series B-1 preferred stock and vested Company options shall receive the balance of the merger consideration, as set forth in the Merger Agreement.

The Company has made customary representations, warranties and covenants in the Merger Agreement, including, among others, representations relating to (i) the due organization and good standing of the Company, (ii) the requisite power and authority to execute and deliver the Merger Agreement and related documents to which it is a party, (iii) no conflicts of laws and agreements, (iv) capitalization of the Company, (v) financial statements of the Company, (vi) absence of undisclosed liabilities, (vii) possession of tangible personal property, (viii) absence of litigation, (ix) compliance with applicable laws, (x) insurance, (xi) payment of taxes and (xii) bank accounts. In addition, the Company made certain additional customary covenants, including, among others, covenants, (A) to allow Zebra between the execution of the Merger Agreement and the consummation of the Merger, to conduct due diligence and investigations with respect to the Company, (B) not to solicit proposals relating to alternative business combination transactions, (C) to conduct its business in the ordinary course between the execution of the Merger Agreement and the consummation of the Merger and (D) not to engage in certain kinds of transactions during such period. Consummation of the Merger is also subject to customary conditions, including, among others, (i) approval of the shareholders of the Company, (ii) delivery to Zebra of certain releases, payoff letters and opinion of counsel for the Company and (iii) subject to certain exceptions, the accuracy of representations and warranties with respect to the Company’s business and compliance by the Company with its covenants contained in the Merger Agreement.

The Merger Agreement also provides that each of the shareholders of the Company shall, jointly and severally, indemnify Zebra, the surviving corporation and the affiliates of the foregoing for any and all losses as a result of, among other things, any misrepresentation or breach of any representation or warranty under the Merger Agreement, in most cases only to the extent the losses exceed $250,000. Generally, Zebra’s recourse is limited to the amounts in the escrow.

The Support Agreements

Concurrently with the execution of the Merger Agreement, Zebra and Merger Sub entered into voting and support agreements (the “Support Agreements”), with the holders of shares of Company stock constituting 85% of such shares (the “Principal Shareholders”), representing shareholders holding more than the minimum number of votes necessary to approve the Merger and the transactions contemplated thereby. Pursuant to the Support Agreements and subject to the terms and conditions thereof, each of the Principal Shareholders agreed to vote his, her or its shares in favor of the Merger.

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Assumption of WhereNet Options

Pursuant to the Merger Agreement, Zebra will assume outstanding unvested options to acquire WhereNet common stock granted under the WhereNet 1997 Stock Option Plan (the “WhereNet Option Plan”). Each option that is outstanding and unexercised pursuant to the WhereNet Option Plan in effect on the date of the Merger Agreement and which is unvested immediately prior to the effective time, will become and represent a replacement stock option to purchase a proportionate number of shares of Zebra common stock in accordance with the terms of the Merger Agreement.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number	Description of Exhibit
10.1	Press Release

3

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 hereunto duly authorized.

	ZEBRA TECHNOLOGIES CORPORATION
Date: January 11, 2007	By:	/s/    Edward L. Kaplan
		Edward L. Kaplan
		Chairman of the Board and Chief Executive Officer

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EXHIBIT INDEX

Exhibit Number	Description of Exhibit
10.1	Press Release

5

EX-10.1

Exhibit 10.1

FOR IMMEDIATE RELEASE

Zebra Technologies to Enter Active RFID with Acquisition of WhereNet Corp.

Vernon Hills, IL, January 11, 2007–Zebra Technologies Corporation (NASDAQ: ZBRA) today announced that it has agreed to acquire all of the shares of WhereNet Corp., a leading global provider of active radio frequency identification (RFID) based wireless solutions to track and manage enterprise assets, for $126 million in cash. The transaction is expected to close by the end of January, and is subject to WhereNet shareholder approval and expiration of the H-S-R waiting period on January 13, 2007. Zebra has voting agreements from WhereNet shareholders representing more than 85% of the voting stock to vote in favor of the transaction.

Headquartered in Santa Clara, CA, WhereNet provides integrated wireless Real Time Locating Systems (RTLS) to companies primarily in the industrial manufacturing, transportation and logistics, and aerospace and defense sectors. Founded in 1997, it has more than 150 installations currently in operation helping companies locate and track high-value assets with wireless tags, fixed-position antennas and Web-enabled software. WhereNet solutions are successfully used to increase the accuracy, velocity, efficiency, and security of time-critical processes throughout the supply chain. They are employed in parts replenishment, vehicle inventory tracking, truck yard management, marine cargo tracking, and work-in-process tracking, among many other applications. WhereNet’s solutions span hardware, middleware, application software, and services for project management, maintenance and support.

“WhereNet adds another high-growth platform to Zebra’s business,” stated Edward Kaplan, Zebra’s chairman and chief executive officer. “Active RFID is a natural complement to passive RFID and barcoding, two key Zebra strengths, as it enhances our ability to deliver business improvement solutions to customers worldwide. We are very pleased to welcome WhereNet into Zebra and believe this transaction is an important step in building value for our stockholders.”

“Combining with Zebra gives WhereNet the resources to expand its global footprint and become the definitive leader in our industry,” said Dan Doles, WhereNet’s chief executive officer. “We are pleased to become a part of Zebra’s larger, stronger organization, which will help us accelerate the market growth for active RFID and RTLS.”

Independent industry analysts forecast sales of active RFID systems to increase to $6.8 billion in 2016 from $550 million in 2006, a compound annual growth rate of 29%. Analysts project growth in RTLS to $1.6 billion in 2010 from $15 million in 2005.

Zebra management expects WhereNet to generate sales of approximately $50 million in 2007, up from $36 million in 2006. The acquisition is expected to be minimally dilutive to Zebra’s net income in 2007 and be accretive thereafter. Zebra will operate WhereNet as a separate business unit, which will be led by Mr. Doles.

Forward-looking Statement

This press release contains forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements regarding the company’s sales forecast for WhereNet and the acquisition’s impact on net income stated in the paragraph directly above. Actual results may differ from those expressed or implied in the company’s forward-looking statements. These statements represent estimates only as of the date they were made. Zebra may elect to update forward-looking statements but expressly disclaims any obligation to do so, even if the company’s estimates change.

These forward-looking statements are based on current expectations, forecasts and assumptions and are subject to the risks and uncertainties inherent in Zebra’s industry, market conditions, general domestic and international economic conditions, and other factors. These factors include market conditions in North America and other geographic regions and market acceptance of Zebra’s printer and software products and competitors’ product offerings and the potential effects of technological changes. Other factors include U.S. and foreign regulations that pertain to electrical and electronic equipment, including European directives relating to the collection, recycling, treatment and disposal of products and the reduction or elimination of certain specified materials in such products. Zebra’s failure to comply with these regulations may subject Zebra to penalties, prevent Zebra from selling its products in a certain country, or increase the cost of supplying the products. Profits and profitability will be affected by the company’s ability to control manufacturing and operating costs. Because of a large investment portfolio, interest rate and financial market conditions will also have an impact on results. Foreign exchange rates will have an effect on financial results because of the large percentage of our international sales. The outcome of litigation in which Zebra is involved, and particularly litigation or claims related to infringement of third party intellectual property rights, is another factor. Similar factors apply equally to WhereNet’s business. In addition, the acquisition of WhereNet has risks relating to integrating WhereNet’s business and operations with Zebra’s. These and other factors could have an adverse effect on Zebra’s revenues, gross profit margins and results of operations and increase the volatility of our financial results. When used in this release and documents referenced, the words “anticipate,” “believe,” “estimate,” and “expect” and similar expressions, as they relate to the company or its management are intended to identify such forward-looking statements, but are not the exclusive means of identifying these statements. Descriptions of the risks, uncertainties and other factors that could affect the company’s future operations and results can be found in Zebra’s filings with the Securities and Exchange Commission. In particular, readers are referred to Zebra’s Form 10-K for the year ended December 31, 2005, and the Risk Factors in Zebra’s Form 10-Q for the quarter ended September 30, 2006.

Zebra Technologies Corporation delivers innovative and reliable on-demand printing solutions for business improvement and security applications in 100 countries around the world. More than 90 percent of Fortune 500 companies use Zebra-brand printers. A broad range of applications benefit from Zebra-brand thermal bar code, “smart” label, receipt, and card printers, resulting in enhanced security, increased productivity, improved quality, lower costs, and better customer service. The company has sold more than 5 million printers, including RFID printer/encoders and wireless mobile solutions, as well as ZebraDesigner label formatting software, ZebraLink connectivity solutions, Genuine Zebra supplies and ZebraCare services and support. Information about Zebra bar code, card and RFID products can be found at http://www.zebra.com.

Conference Call Invitation

Investors are invited to listen to a live Internet broadcast of Zebra’s conference call discussing the WhereNet acquisition. The conference call will be held at 11:00 Eastern Time, Friday, January 12, 2007. To listen to the call, visit the company’s Web site at www.zebra.com. To join the conference call, please dial: 706-645-9200; Leader: Charles Whitchurch. Please call several minutes before 11:00 AM Eastern Time.

Inquiries:

For information about Zebra Technologies, contact:

Investors:

Douglas A. Fox, 847-793-6735

Media:

Cindy Lieberman, 847-793-5518