Discontinued Operations

12 Months Ended

Dec. 31, 2012

Discontinued Operations

Note 23 Discontinued Operations

Sale of Navis, LLC - On March 18, 2011, we sold our Navis marine terminal solutions business and the related WhereNet marine terminal solutions product line of our Zebra Enterprise Solutions (“ZES”) business segment for approximately $188,588,000 in cash to Cargotec Corporation. As of December 31, 2011, Zebra had a short term receivable from the buyer in the amount of $27,580,000 which represented funds held in escrow, of which, we received $13,790,000 in the first quarter of 2012 and the remaining $13,790,000 in the third quarter of 2012.

Sale of proveo AG - On August 3, 2011, we entered into a Share Purchase Agreement with F Two NV (a Belgium company) to sell all of our interest in Zebra Enterprise Solutions GmbH (formerly proveo AG) business. The loss recorded upon divestiture was $1,248,000. As part of the sale, Zebra agreed with the buyer to provide a revolving loan of up to €1,000,000 which was due on August 3, 2012 and bore interest at 6.5%. Zebra realized tax benefits in the amount of $13,308,000 with the divestiture of proveo AG. These tax benefits are primarily related to the difference in book basis versus tax basis. On June 29, 2012 F Two NV (a Belgium company) sold the business and assigned the revolving loan to OBQ SA (a Luxembourg company) with Zebra’s consent. The revolving loan commitment was reduced to a lesser amount of up to €526,058. The due date for borrowings under the agreement was extended from August 3, 2012 to December 31, 2012. The interest rate remains unchanged at 6.5%. In 2012, Zebra realized a gain of $930,000 related to payments received under the loan agreement. The balance of the loan outstanding at December 31, 2012 was € 376,058.

Beginning in the first quarter of 2011, Zebra reported the results of these businesses as discontinued operations. The amounts presented below for discontinued operations include Navis and proveo assets and liabilities, and the operating results of these businesses for the years ended December 31, 2012, 2011 and 2010. With the Navis sale, Zebra consolidated the remaining ZES location solutions operations.

Summary results for discontinued operations in our consolidated statement of earnings are as follows (in thousands):

	Year Ended December 31
	2012		2011		2010
Net sales	$	0	$	13,945	$	62,489
Loss from discontinued operations	$	(141)	$	(13,971)	$	(4,673)
Income tax benefit		218		1,299		1,837
Gain on sale of discontinued operations		930		68,745		0
Income tax expense on sale		0		(11,773)		0
Income (loss) from discontinued operations	$	1,007	$	44,300	$	(2,836)

The components of cash flows of discontinued operations in our consolidated statement of cash flows are as follows (in thousands):

	Year Ended December  31
	2012		2011			2010
Cash flows from discontinued operations:
Net cash (used) by operating activities	$	0	$	(1,301	)	$	(2,164)
Net cash provided by (used in) by investing activities		0		0			0
Net cash provided by (used in) by financing activities		0		0			0
Effect of exchange rate changes on cash		0		0			1,771
Net decrease in cash and cash equivalents		0		(1,301	)		(393)
Cash and cash equivalents at beginning of period		0		1,301			1,694
Cash and cash equivalents at end of period	$	0	$	0		$	1,301