3333 Warrenville Road

XYZ Products 3333 Warrenville Road Lisle, IL 60532-1157 T: 630.555.5555 [email protected]

Letter of Agreement

February 17, 2012

Ray Smith Street Address City, State, Zip Code

Dear Ray: Subject: Letter of Agreement – VP Supply Chain Management, Asia

We are pleased that you have accepted our offer to assume the position of VP Supply Chain Management, Asia and look forward to you joining our organization as a key executive. We have outlined below the major elements of our agreement and ask that you review and confirm your understanding with your signature.

1. Position: VP Supply Chain Management, Asia XYZ Corporation

2. Job responsibilities: Reporting to the EVP Supply Chain –Lou Jones. The VP Supply Chain Management- Asia is responsible for the cost, quality, and supply assurance of outbound supply chain products and services in support of sites in the US. Leads team of fifteen (15) located in Hong Kong, Guangzhou and Ningbo, China. Provides instructions, guidance, and assistance in the overall performance of the Asia team. Also responsible for the selection, retention, relationships, quality and on-time delivery in the form of corporate purchasing agreements and logistic efficiencies.

3. Start date: No later than February 17, 2012

4. Base Salary: $ 85,000.00 per annum. Paid weekly at $ 1634.62 per paycheck. 52 times per year.

5. Performance and Salary review: Merit and salary each year in June thereafter.

6. Incentive compensation: Bonus factor of 18.5% (scaled 0-37%) of base per year, paid annually. 50% payout in December, 50% payout in February, and each December and February thereafter. Bonus is paid based on metrics as follows. On time delivery=45%, Profitability of the account=45%, Days Sales Outstanding=10%.

7. Vacation Employees start to earn vacation on their first day of active employment. Years 1- 5 80 hours (2 weeks) Years 6 - 14 120 hours (3 weeks) Years 15 - 19 160 hours (4 weeks) Years 20 - 24 200 hours (5 weeks) Years 25 + 240 hours (6 weeks)

9042 Pimpernel Drive, San Diego, CA 92129 858.750.9391 www.TransLogic.com XYZ Products 3333 Warrenville Road Lisle, IL 60532-1157 T: 630.555.5555 [email protected]

8. Health Benefits All active, regular, full time employees are covered under the Health Plan. The Plan provides coverage for a broad range of health care needs, including hospital, surgical and medical care, prescription drug, dental care and vision care. Coverage begins the first day of regular, active employment. The cost of premium for coverage depends on the health plan selected.

9. Medical Care: Plan Choices PPO Plus - offers employee and eligible dependents the opportunity to choose in network or out of network providers. Under this plan, there are no premiums for coverage. When using in network providers, there are deductibles and co-insurance. Using out of network providers requires higher deductibles and co-insurance costs.

CIGNA HMO - offers employee and eligible dependents health care coverage as provided by the CIGNA Network of Medical Providers. Under this plan, there is a weekly premium for coverage. At the time of service, co-pay is paid for services provided. Refer to Health Plan Program Highlights for more details on coverage. $20.00 per week for family coverage with no deductible.

Local HMO – Local Health Maintenance Organization (HMO) options exist in certain geographical areas. Under this plan, there is a weekly premium for coverage. At the time of service, co-pay is paid for services provided. Plan details vary by local HMO provider. Refer to Health Plan Program Highlights for more details on coverage.

Opt Out – to decline health coverage for the employee and dependents for the current calendar year because all are covered under another health insurance plan. There is a monetary bonus of up to $750 per year if this option is selected.

10.Prescription Drug Program Retail Network Pharmacy: For up to a 30-day supply $10 generics $25 brand name formulary drugs $40 brand name non-formulary drugs

Mail Order Program: For up to a 90-day supply $20 generic $50 brand name formulary drugs $80 brand name non-formulary drugs

11.Vision Care $250 maximum benefit per member in 24-month period for all vision services.

12.Dental Care $50.00 deductible per individual ($150 family limit) Preventative- 100% (twice a year routine services) not subject to deductible. Restorative- 20% employee coinsurance cost after deductible (basic), 50% after deductible Annual max. -$2,000 per person

Orthodontics- For dependants under age 19- 50%of Usual & Customary- $1,500 per person max.

13.Employee Assistance Program Mental Health & Substance Abuse - Managed through CIGNA Behavioral Offers employee choice of in network or out of network services and provides coverage for inpatient and outpatient treatment. No lifetime maximum for mental health; $36,000 substance abuse lifetime maximum.

14.Group Life Insurance Basic Coverage in the amount of two times basic annual salary is provided at no cost to employee. Employees may elect to enroll in Optional Life Coverage in the amount of an additional one or two times annual basic salary – the premium is paid through a weekly payroll deduction.

15.24-Hour Accidental Death & Dismemberment Insurance Optional coverage offered at group rate for employees and eligible dependents – the premium is paid through a monthly payroll deduction.

16.Sick Pay & Long Term Disability After 6 months of service, employees are eligible for up to 10 sick days each year. In cases of prolonged illness or disability, employees may be eligible for short-term disability benefits (two-thirds of regular pay) for up to 180 days. In qualifying cases, long-term disability coverage (two-thirds of regular pay) can begin for disabled employees after 180 consecutive days not worked due to disability.

17.Retirement Programs a. 401k Plan provides an opportunity for employees to contribute to their own retirement income through pre-tax payroll deductions. An employee is eligible to participate from the 1st day of employment and can contribute between 1% and 50% of their pre-tax income, up to a deferral of $13,000 annually. The Company contributes to the plan in the form of matching contributions at 50% of the first 3% of quarterly basic compensation. Employee is vested to receive the company match after 2 years of service. b. Retirement Plan provides monthly income during retirement. Depends on final average compensation and years of service with the Company. Company contribution pays full cost of Plan. Employee is vested in this plan after 5 years of service.

18.Stock Purchase Plan Voluntary opportunity to purchase common stock through regular and convenient payroll deductions.

19.Holidays It is the policy of XYZ Corporation to recognize nine days as paid holidays for regular full time, non- contractual employees. Those generally observed are: New Year’s Day, Memorial Day, Independence Day, Labor Day Thanksgiving, Day After Thanksgiving, Christmas Eve, Christmas Day, Floating Holiday (this date is determined by location manager)

20.Leaves of Absence XYZ Corporation provides regular, full time employees with Medical, Family Care, Emergency, Bereavement, Military and other legislated leaves as necessary.

21.Other Employee Benefits Programs  Direct Deposit  Incentive Compensation Programs (ICP)  Tuition Reimbursement  Scholarships for children of employees  Pre-tax medical care and dependent care spending accounts  Business Travel Insurance

22.Relocation:  Shipment of Household Goods  Storage of Household Goods ( 30-60 days)  “Gross-up” of Non-deductible Moving Expenses  Temporary Housing for Employee  Temporary Housing for Family  House Hunting Trip for New-hire  House Hunting trip for Spouse  Cover Closing Costs on Home Purchase  Home sale Assistance (Home Buyout)  Homesale Assistance (If Buyout is not Exercised)  Lease Breaking Penaliteis  Miscellaneous Allowance (1 Month’s Salary)

23.Business expenses: The Company will reimburse you for reasonable business expenses in accordance with Company policy. (i.e. lap top, cell phone, travel and entertainment)

24.Confidentiality Agreement: During and after any termination of employment for any reason you agree that all of the technological innovations, trademarks, tradenames, opyrights, customer lists, marketing programs, service programs, software programs, trade secrets and other proprietary rights (“Proprietary Information”) used or developed in XYZ Corporation business shall belong to and remain the property of XYZ Corporation and that you shall have no rights thereto. You acknowledge that the Proprietary Information constitutes valuable, unique, proprietary and confidential property of XYZ Corporation. You agree that you will not divulge or otherwise disclose, directly or indirectly, any Proprietary Information during employment or at any time thereafter while such information remains proprietary or confidential. Upon termination of employment for any reason you agree to immediately return to XYZ Corporation, all materials or information concerning XYZ Corporation regardless of their nature. You will not pursue or provide current XYZ Corporation customers’ services on business that XYZ Corporation currently services (ie lanes, dedicated equipment) for a period of one year.

25.Non-Disclosure, Non-Solicitation Agreement: Offer contingent on your signing Agreement. (Attached)

26.Offer of employment contingent upon satisfactory passing of drug screen, criminal background check, reference check and credit check.

Ray, if you are in accord with the above major elements, please sign your name in the space provided below signifying your agreement with the terms of this offer. Welcome aboard!!

Sincerely, Agreed to by:

Lou Jones Ray Smith Chief Executive Officer

9042 Pimpernel Drive, San Diego, CA 92129 858.750.9391 www.TransLogic.com