0000028823 2009-07-01 2009-09-30 0000028823 2009-01-01 2009-12-31 0000028823 2009-09-30 0000028823 2008-12-31 0000028823 2010-07-01 2010-09-30 0000028823 2010-09-30 0000028823 2009-12-31 0000028823 2009-06-30 0000028823 2010-10-29 0000028823 2009-01-01 2009-09-30 0000028823 2010-01-01 2010-09-30 iso4217:USD xbrli:shares xbrli:shares iso4217:USD

<div align="left" style="font-family: 'Times New Roman',Times,serif">   <div align="center" style="font-size: 10pt; margin-top: 0pt"><b> </b> </div> <div align="left"> </div> <div align="center" style="font-size: 10pt"><b></b></div> <div align="center" style="font-size: 10pt"><b></b></div> <div align="center" style="font-size: 10pt"><b></b></div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 1:   CONSOLIDATED FINANCIAL STATEMENTS</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 5pt">The accompanying unaudited condensed consolidated financial statements of Diebold, Incorporated and its subsidiaries (collectively, the Company) have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with U.S. generally accepted accounting principles (GAAP); however, such information reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for a fair statement of the results for the interim periods. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in the Company’s annual report on Form 10-K for the year ended December 31, 2009. In addition, some of the Company’s statements in this quarterly report on Form 10-Q may involve risks and uncertainties that could significantly impact expected future results. The results of operations for the three and nine months ended September 30, 2010 are not necessarily indicative of results to be expected for the full year. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company has reclassified the presentation of certain prior-year information to conform to the current presentation. As discussed in Note 15, effective in the first quarter of 2010, the Company began management of its businesses on a geographic basis, changing from the previous model of sales channel segments. In order to align the Company’s external reporting of its financial results with this organizational change, the Company has modified its segment reporting and has reclassified prior period segment information to conform to the current period presentation of its segment information. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company’s Venezuelan operations consist of a fifty-percent owned subsidiary, which is consolidated. On January 8, 2010, the Venezuelan government announced the devaluation of its currency, the bolivar, and the establishment of a two-tier exchange structure. Subsequently, during May 2010, the Venezuelan government seized control of the parallel market, thereby creating a new government-controlled rate. Transitioning from the parallel rate to the new government-controlled rate did not have a material impact on the Company’s condensed consolidated financial statements. In the future, if the Company converts bolivares at a rate other than the new government-controlled rate, the Company may realize additional gains or losses that would be recorded in the statement of income. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The Company continues to work to remediate a control weakness in the area of application of accounting policies specific to multiple-deliverable arrangements. As part of remediation, during the third quarter of 2010, the Company recorded an out-of-period adjustment to defer revenue previously recognized that was not in accordance with GAAP. The immaterial out-of-period adjustment was recorded within the Company’s operations in China, included in the Diebold International (DI) reporting segment. The adjustment decreased revenue related to multiple-deliverable contracts that included revenue which was contingent upon the installation of the equipment. This deferred revenue will be recognized upon completion of installation. The out-of-period adjustment for the three and nine months ended September 30, 2010 represents a decrease in revenue of $18,688 and $19,822, respectively and a decrease to operating profit of $5,270 and $5,753, respectively. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company’s significant accounting policies as reported in the Company’s annual report on Form 10-K for the year ended December 31, 2009 were amended in the first quarter of 2010 upon the adoption of Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) 2009-13, <i>Multiple-Deliverable Revenue Arrangements </i>(ASU 2009-13), and FASB ASU 2009-14, <i>Certain Arrangements That Include Software Elements </i>(ASU 2009-14). On January 1, 2010, the Company elected to early adopt ASU 2009-13 and ASU 2009-14, which did not have a material impact on the Company’s condensed consolidated financial statements. However, the adoption of ASU 2009-13 and ASU 2009-14 modifies the Company’s previously disclosed revenue recognition policy, which is presented below as revised. ASU 2009-14 amends software revenue recognition guidance in FASB Accounting Standards Codification (ASC) 985-605 <i>Software — Revenue Recognition </i>(ASC 985-605), to exclude from its scope the Company’s tangible products that contain both software and non-software components that function together to deliver a product’s essential functionality. ASU 2009-13 modifies the requirements that must be met for the Company to recognize revenue from the sale of a delivered item that is part of a multiple-deliverable arrangement when other items have not yet been delivered. ASU 2009-13 establishes a selling price hierarchy for determining the selling price of a deliverable in a multiple-deliverable arrangement. The selling price must be based on vendor specific objective evidence (VSOE), if available, or third-party evidence (TPE), if VSOE is not available, or estimated selling price if neither VSOE nor TPE is available. Also, the residual method of allocating arrangement consideration has been eliminated. ASU 2009-13 and ASU 2009-14 were applied on a prospective basis for revenue arrangements entered into or materially modified after adoption. There were no changes to the Company’s units of accounting within its multiple-deliverable arrangements, how the Company allocates arrangement consideration or in the pattern or timing of revenue recognition as a result of the adoption of these updates. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>Revenue Recognition </b>The Company’s revenue recognition policy is consistent with the requirements of FASB ASC 605, <i>Revenue Recognition </i>(ASC 605). In general, the Company records revenue when it is realized, or realizable and earned. The Company considers revenue to be realized, or realizable and earned, when the following revenue recognition requirements are met: persuasive evidence of an arrangement exists, which is a customer contract; the products or services have been approved by the customer via delivery or installation acceptance; the sales price is fixed or determinable within the contract; and collectability is probable. For product sales, the Company determines that the earnings process is complete when title, risk of loss and the right to use equipment has transferred to the customer. Within the North America business segment, this occurs upon customer acceptance. Where the Company is contractually responsible for installation, customer acceptance occurs upon completion of the installation of all items at a job site and the Company’s demonstration that the items are in operable condition. Where the Company is not contractually responsible for installation, revenue recognition of these items is upon shipment or delivery to a customer location depending on the terms in the contract. Within the international business segment, customer acceptance is upon the earlier of delivery or completion of the installation depending on the terms in the contract with the customer. The Company has the following revenue streams related to sales to its customers: </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt; margin-left: 7%"><u><b><i>Financial Self-Service Product & Integrated Services Revenue</i></b></u> Financial self-service products pertain to automated teller machines (ATMs). Included with the ATM is a software component and a non-software component that function together to deliver the ATM’s essential functionality. The Company also provides service contracts on ATMs. Service contracts typically cover a 12-month period and can begin at any given month after the warranty period expires. The service provided under warranty is limited as compared to those offered under service contracts. Further, warranty is not considered a separate deliverable of the sale. The Company’s warranty covers only replacement of defective parts inclusive of labor. Service contracts are tailored to meet the individual needs of each customer. Service contracts provide additional services beyond those covered under the warranty, and usually include preventative maintenance service, cleaning, supplies stocking and cash handling, all of which are not essential to the functionality of the equipment. Outsourced and managed services include remote monitoring, trouble-shooting for self-service customers, training, transaction processing, currency management, maintenance services and full support via person to person or online communication. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt; margin-left: 7%">Revenue is recognized in accordance with ASC 605, the application of which requires judgment including the determination of whether an arrangement includes multiple deliverables. For stand-alone sales of service contracts, revenue is recognized ratably over the life of the contract period. In contracts that involve multiple-deliverable arrangements, product maintenance services are typically accounted for under FASB ASC 605-20, <i>Separately Priced Extended Warranty and Product Maintenance Contracts </i>(ASC 605-20). Amounts deferred for undelivered items are determined based upon the selling price of the deliverables as prescribed in FASB ASC 605-25, <i>Revenue Recognition — Multiple-Element Arrangements </i>(ASC 605-25). The Company determines the selling price of deliverables within a multiple-deliverable arrangement based on VSOE (price when sold on stand-alone basis) or the estimated selling price where VSOE is not established for undelivered items. Total arrangement consideration is allocated at the inception of the arrangement to all deliverables using the relative selling price method, which allocates any discount in the arrangement proportionately to each deliverable on the basis of each deliverable’s selling price. There have been no material changes to these estimates for the periods presented and the Company believes that these estimates generally should not be subject to significant changes in the future. However, changes to deliverables in future arrangements and the ability to establish the selling price could materially impact the amount of earned or deferred revenue. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt; margin-left: 7%"><u><b><i>Electronic Security Products & Integrated Services Revenue</i></b></u> The Company provides global product sales, service, installation, project management and monitoring of original equipment manufacturer (OEM) electronic security products to financial, government, retail and commercial customers. These solutions provide the Company’s customers a single-source solution to their electronic security needs. Revenue is recognized in accordance with ASC 605. Revenue on sales of the products described above is recognized upon shipment, installation or customer acceptance of the product as defined in the customer contract. In contracts that involve multiple deliverables, product maintenance services are typically accounted for under ASC 605-20. Amounts deferred for undelivered items are based upon the selling price of the deliverables as prescribed in ASC 605-25. The Company determines the selling price of deliverables within a multiple-deliverable arrangement based on the price charged when each deliverable is sold separately or estimated selling price. Total arrangement consideration is allocated at the inception of the arrangement to all deliverables using the relative selling price method, which allocates any discount in the arrangement proportionately to each deliverable on the basis of each deliverable’s selling price. There have been no material changes to these estimates for the periods presented and the Company believes that these estimates generally should not be subject to significant changes in the future. However, changes to deliverables in future arrangements and the ability to establish the selling price could materially impact the amount of earned or deferred revenue. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt; margin-left: 7%"><u><b><i>Physical Security & Facility Revenue</i></b></u> The Company designs and manufactures several of its physical security and facility products. These consist of vaults, safe deposit boxes and safes, drive-up banking equipment and a host of other banking facilities products. Revenue on sales of the products described above is recognized when the revenue recognition requirements of ASC 605 have been met. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt; margin-left: 7%"><u><b><i>Election and Lottery Systems Revenue</i></b></u> The Company offers election and lottery systems product solutions and support to the government in Brazil. Election systems revenue consists of election equipment, networking, tabulation and diagnostic software development, training, support and maintenance. Lottery systems revenue consists of lottery equipment. The election and lottery equipment components are included in product revenue. The software development, training, support and maintenance components are included in service revenue. The election and lottery systems contracts can contain multiple deliverables and custom terms and conditions. For contracts that do not contain multiple deliverables, revenue is recognized upon customer acceptance. In contracts that involve multiple deliverables, amounts deferred for undelivered items are based upon the selling price of the deliverables as prescribed in ASC 605-25. The Company determines the selling price of deliverables within a multiple-deliverable arrangement based on the estimated selling price. Total arrangement consideration is allocated at the inception of the arrangement to all deliverables using the relative selling price method, which allocates any discount in the arrangement proportionately to each deliverable on the basis of each deliverable’s selling price. There have been no material changes to these estimates for the periods presented and the Company believes that these estimates generally should not be subject to significant changes in the future. However, changes to deliverables in future arrangements and the ability to establish the selling price could materially impact the amount of earned or deferred revenue. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt; margin-left: 7%"><u><b><i>Software Solutions & Service Revenue</i></b></u> The Company offers software solutions consisting of multiple applications that process events and transactions (networking software) along with the related server. Sales of networking software represent software solutions to customers that allow them to network various different vendors’ ATMs onto one network and revenue is recognized in accordance with ASC 985-605. Included within service revenue is revenue from software support agreements, which are typically 12 months in duration and pertain to networking software. For stand-alone sales of software support, revenue is recognized ratably over the life of the contract period. In contracts that involve multiple deliverables, amounts deferred for support are based upon VSOE of the value of the deliverables as prescribed in ASC 985-605, which requires judgment about whether the deliverables can be divided into more than one unit of accounting and whether the separate units of accounting have value to the customer on a stand-alone basis. There have been no material changes to these deliverables for the periods presented. However, changes to deliverables in future arrangements and the ability to establish VSOE could affect the timing of revenue recognition. </div> <div align="justify" style="font-size: 10pt; margin-top: 12pt"><b>Recently Adopted Accounting Guidance</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In May 2010, the FASB issued ASU 2010-19, <i>Foreign Currency Issues: Multiple Foreign Currency Exchange Rates </i>(ASU 2010-19). ASU 2010-19 is effective as of the announcement date of March 18, 2010. ASU 2010-19 provides the Securities and Exchange Commission (SEC) staff’s views on certain foreign currency issues related to investments in Venezuela. These issues relate to Venezuela’s highly inflationary status. The adoption of the provisions of ASU 2010-19 did not have a material impact on the Company’s condensed consolidated financial statements. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">On January 1, 2010, the Company adopted ASU 2009-13 and ASU 2009-14, as noted above. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">On January 1, 2010, the Company adopted FASB ASU 2010-06, <i>Fair Value Measurements and Disclosures</i> (ASU 2010-06). ASU 2010-06 updates FASB ASC 820, <i>Fair Value Measurements</i>. ASU 2010-06 requires additional disclosures about fair value measurements including transfers in and out of levels 1 and 2 and a higher level of disaggregation for the different types of financial instruments. On January 1, 2010, the Company early adopted ASU 2010-06 related to the reconciliation of level 3 fair value measurements, requiring information about purchases, sales, issuances and settlements to be presented separately. There was no material impact on the Company’s condensed consolidated financial statements related to the adoption of this guidance. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">On January 1, 2010, the Company adopted updated guidance included in FASB ASC 860-10, <i>Transfers and Servicing — Overall. </i>This guidance requires additional disclosures about the transfer and de-recognition of financial assets and eliminates the concept of qualifying special-purpose entities. The adoption of this guidance did not have an impact on the Company’s condensed consolidated financial statements. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">On January 1, 2010, the Company adopted updated guidance included in FASB ASC 810, <i>Consolidation</i> (ASC 810), related to the consolidation of variable interest entities. This guidance requires ongoing reassessments of whether an enterprise is the primary beneficiary of a variable interest entity. In addition, this updated guidance amends the quantitative approach for determining the primary beneficiary of a variable interest entity. ASC 810 amends certain guidance for determining whether an entity is a variable interest entity and adds additional reconsideration events for determining whether an entity is a variable interest entity. Further, this guidance requires enhanced disclosures that will provide users of financial statements with more transparent information about an enterprise’s involvement in a variable interest entity. The adoption of this guidance did not have an impact on the Company’s condensed consolidated financial statements. </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="justify" style="font-size: 10pt; margin-top: 12pt"><b>NOTE 2: EARNINGS PER SHARE</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Basic and diluted earnings per share are calculated in accordance with FASB ASC 260, <i>Earnings Per Share</i>. Under this guidance, unvested share-based payment awards that contain rights to receive non-forfeitable dividends are considered participating securities and the two-class method of computing earnings per share is required for all periods presented. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company’s participating securities include restricted stock units, deferred shares and shares that were vested, but deferred by the employee. The Company has calculated basic and diluted earnings per share under both the treasury stock method and the two-class method. For the three and nine months ended September 30, 2010 and 2009, there was no impact in the per share amounts calculated under the two methods, therefore the treasury stock method is disclosed below. The following data shows the amounts used in computing earnings per share under the treasury stock method and the effect on the weighted-average number of shares of dilutive potential common stock: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="97%">  <tr valign="bottom" style="font-size: 10pt"> <td width="59%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Three Months Ended</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Nine Months Ended</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Numerator:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:25px; text-indent:-15px">Income used in basic and diluted earnings per share: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Income from continuing operations, net of tax </div></td> <td> </td> <td align="left">  $</td> <td align="right">44,062</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">24,486</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">99,370</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">65,203</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:25px; text-indent:-15px">Income (loss) from discontinued operations, net of tax </div></td> <td> </td> <td> </td> <td align="right">2,043</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(31,641)</td> <td> </td> <td> </td> <td> </td> <td align="right">390</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(40,280)</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Net income (loss) attributable to Diebold, Incorporated </div></td> <td> </td> <td align="left">  $</td> <td align="right">46,105</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(7,155)</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">99,760</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">24,923</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Denominator (in thousands):</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Weighted-average number of common shares used in basic earnings per share </div></td> <td> </td> <td> </td> <td align="right">65,705</td> <td> </td> <td> </td> <td> </td> <td align="right">66,279</td> <td> </td> <td> </td> <td> </td> <td align="right">65,982</td> <td> </td> <td> </td> <td> </td> <td align="right">66,236</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:25px; text-indent:-15px">Effect of dilutive shares </div></td> <td> </td> <td> </td> <td align="right">716</td> <td> </td> <td> </td> <td> </td> <td align="right">672</td> <td> </td> <td> </td> <td> </td> <td align="right">587</td> <td> </td> <td> </td> <td> </td> <td align="right">574</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Weighted-average number of shares used in diluted earnings per share </div></td> <td> </td> <td> </td> <td align="right">66,421</td> <td> </td> <td> </td> <td> </td> <td align="right">66,951</td> <td> </td> <td> </td> <td> </td> <td align="right">66,569</td> <td> </td> <td> </td> <td> </td> <td align="right">66,810</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Basic earnings per share:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Income from continuing operations, net of tax </div></td> <td> </td> <td align="left">  $</td> <td align="right">0.67</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">0.37</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1.50</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">0.99</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:25px; text-indent:-15px">Income (loss) from discontinued operations, net of tax </div></td> <td> </td> <td> </td> <td align="right">0.03</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(0.48)</td> <td> </td> <td> </td> <td> </td> <td align="right">0.01</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(0.61)</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Net income (loss) attributable to Diebold, Incorporated </div></td> <td> </td> <td align="left">  $</td> <td align="right">0.70</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(0.11)</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1.51</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">0.38</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Diluted earnings per share:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Income from continuing operations, net of tax </div></td> <td> </td> <td align="left">  $</td> <td align="right">0.66</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">0.37</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1.49</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">0.98</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:25px; text-indent:-15px">Income (loss) from discontinued operations, net of tax </div></td> <td> </td> <td> </td> <td align="right">0.03</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(0.48)</td> <td> </td> <td> </td> <td> </td> <td align="right">0.01</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(0.61)</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Net income (loss) attributable to Diebold, Incorporated </div></td> <td> </td> <td align="left">  $</td> <td align="right">0.69</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(0.11)</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1.50</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">0.37</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Anti-dilutive shares (in thousands):</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Anti-dilutive shares not used in calculating diluted weighted-average shares </div></td> <td> </td> <td> </td> <td align="right">2,160</td> <td> </td> <td> </td> <td> </td> <td align="right">2,146</td> <td> </td> <td> </td> <td> </td> <td align="right">2,047</td> <td> </td> <td> </td> <td> </td> <td align="right">2,372</td> <td> </td> </tr>  </table> </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 3: OTHER COMPREHENSIVE INCOME (LOSS)</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 5pt">The Company displays accumulated other comprehensive income separately from retained earnings and additional capital in the condensed consolidated balance sheets. Items recorded as other comprehensive income (loss) include adjustments made for foreign currency translation under FASB ASC 830, <i>Foreign Currency Matters, </i>pension adjustments, net of tax under FASB ASC 715, <i>Compensation — Retirement Benefits</i>, hedging activities under FASB ASC 815, <i>Derivatives and Hedging </i>and unrealized gains and losses on available-for-sale securities under FASB ASC 320, <i>Investments</i>. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The following table provides a reconciliation of total shareholders’ equity attributable to Diebold, Incorporated and the noncontrolling interests for the three months ended September 30, 2010: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="85%">  <tr valign="bottom"> <td width="50%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="6%"> </td> <td width="8%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Total Diebold,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Incorporated</b></td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="1"><b>Noncontrolling</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Total Equity</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">  <b>Shareholders’ Equity</b>  </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="1" style="border-bottom: 1px solid #000000"><b>Interests</b></td> <td> </td> </tr>   <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of July 1, 2010</b> </div></td> <td> </td> <td align="left">  $</td> <td align="right">1,046,818   </td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1,020,237   </td> <td> </td> <td> </td> <td align="left">$ </td> <td align="right">26,581   </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net income </div></td> <td> </td> <td> </td> <td align="right">47,477   </td> <td> </td> <td> </td> <td> </td> <td align="right">46,105   </td> <td> </td> <td> </td> <td> </td> <td align="right">1,372   </td> <td> </td> </tr> <tr style="font-size: 5pt" valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other comprehensive income (loss): </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Foreign currency hedges and translation </div></td> <td> </td> <td> </td> <td align="right">57,964   </td> <td> </td> <td> </td> <td> </td> <td align="right">57,591   </td> <td> </td> <td> </td> <td> </td> <td align="right">373   </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Interest rate hedges </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(227)  </td> <td nowrap="nowrap"></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(227)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Pensions and other postretirement benefits </div></td> <td> </td> <td> </td> <td align="right">1,501   </td> <td> </td> <td> </td> <td> </td> <td align="right">1,501   </td> <td> </td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Unrealized loss, net on available-for-sale securities </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,262)  </td> <td nowrap="nowrap"></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,262)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Comprehensive income </div></td> <td> </td> <td> </td> <td align="right">105,453   </td> <td> </td> <td> </td> <td> </td> <td align="right">103,708   </td> <td> </td> <td> </td> <td> </td> <td align="right">1,745   </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Common shares </div></td> <td> </td> <td> </td> <td align="right">57   </td> <td> </td> <td> </td> <td> </td> <td align="right">57   </td> <td> </td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Additional capital </div></td> <td> </td> <td> </td> <td align="right">3,981   </td> <td> </td> <td> </td> <td> </td> <td align="right">3,981   </td> <td> </td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Treasury shares </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(3,658)  </td> <td nowrap="nowrap"></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(3,658)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Dividends declared </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(17,913)  </td> <td nowrap="nowrap"></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(17,913)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Distribution to noncontrolling interest holders </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,217)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,217)  </td> <td nowrap="nowrap"></td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of September 30, 2010</b> </div></td> <td> </td> <td align="left">  $</td> <td align="right">1,133,521   </td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1,106,412   </td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">27,109   </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The following table provides a reconciliation of total shareholders’ equity attributable to Diebold, Incorporated and the noncontrolling interests for the three months ended September 30, 2009: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="85%">  <tr valign="bottom"> <td width="50%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="6%"> </td> <td width="8%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Total Diebold,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Incorporated</b></td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="1"><b>Noncontrolling</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Total Equity</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">  <b>Shareholders’ Equity</b>  </td> <td> </td> <td> </td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="1" style="border-bottom: 1px solid #000000"><b>Interests</b></td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of July 1, 2009</b> </div></td> <td> </td> <td align="left">  $</td> <td align="right">1,026,342   </td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1,002,880   </td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">23,462   </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net (loss) income </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(6,404)  </td> <td nowrap="nowrap"></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(7,155)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">751   </td> <td> </td> </tr> <tr style="font-size: 5pt" valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other comprehensive income (loss): </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Foreign currency hedges and translation </div></td> <td> </td> <td> </td> <td align="right">47,784   </td> <td> </td> <td> </td> <td> </td> <td align="right">48,988   </td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,204)  </td> <td nowrap="nowrap"></td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Interest rate hedges </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(427)  </td> <td nowrap="nowrap"></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(427)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Pensions and other postretirement benefits </div></td> <td> </td> <td> </td> <td align="right">1,170   </td> <td> </td> <td> </td> <td> </td> <td align="right">1,170   </td> <td> </td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Comprehensive income (loss) </div></td> <td> </td> <td> </td> <td align="right">42,123   </td> <td> </td> <td> </td> <td> </td> <td align="right">42,576   </td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(453)  </td> <td nowrap="nowrap"></td> </tr> <tr style="font-size: 5pt" valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Common shares </div></td> <td> </td> <td> </td> <td align="right">65   </td> <td> </td> <td> </td> <td> </td> <td align="right">65   </td> <td> </td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Additional capital </div></td> <td> </td> <td> </td> <td align="right">3,889   </td> <td> </td> <td> </td> <td> </td> <td align="right">3,889   </td> <td> </td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Treasury shares </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(41)  </td> <td nowrap="nowrap"></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(41)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Dividends declared </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(17,364)  </td> <td nowrap="nowrap"></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(17,364)  </td> <td nowrap="nowrap"></td> <td> </td> <td> </td> <td align="right">—   </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of September 30, 2009</b> </div></td> <td> </td> <td align="left">  $</td> <td align="right">1,055,014   </td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1,032,005   </td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">23,009   </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The following table provides a reconciliation of total shareholders’ equity attributable to Diebold, Incorporated and the noncontrolling interests for the nine months ended September 30, 2010: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="80%">  <tr valign="bottom"> <td width="54%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="2%">   </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="2%">   </td> <td width="2%"> </td> <td width="10%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Total Diebold,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Incorporated</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Noncontrolling</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Total Equity</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">  <b>Shareholders’ Equity</b>  </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Interests</b></td> </tr>   <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of January 1, 2010</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">1,072,026</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,046,379</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">25,647</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net income </div></td> <td> </td> <td> </td> <td align="right">102,089</td> <td> </td> <td> </td> <td> </td> <td align="right">99,760</td> <td> </td> <td> </td> <td> </td> <td align="right">2,329</td> <td> </td> </tr> <tr valign="bottom" style="line-height: 6pt"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other comprehensive income (loss): </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Foreign currency hedges and translation </div></td> <td> </td> <td> </td> <td align="right">21,505</td> <td> </td> <td> </td> <td> </td> <td align="right">21,146</td> <td> </td> <td> </td> <td> </td> <td align="right">359</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Interest rate hedges </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,047</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,047</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Pensions and other postretirement benefits </div></td> <td> </td> <td> </td> <td align="right">4,199</td> <td> </td> <td> </td> <td> </td> <td align="right">4,199</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Unrealized loss, net on available-for-sale securities </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(607</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(607</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Comprehensive income </div></td> <td> </td> <td> </td> <td align="right">126,139</td> <td> </td> <td> </td> <td> </td> <td align="right">123,451</td> <td> </td> <td> </td> <td> </td> <td align="right">2,688</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Common shares </div></td> <td> </td> <td> </td> <td align="right">268</td> <td> </td> <td> </td> <td> </td> <td align="right">268</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Additional capital </div></td> <td> </td> <td> </td> <td align="right">15,089</td> <td> </td> <td> </td> <td> </td> <td align="right">15,089</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Treasury shares </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(24,786</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(24,786</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Dividends declared </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(53,989</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(53,989</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Distribution to noncontrolling interest holders </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,226</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,226</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of September 30, 2010</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">1,133,521</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,106,412</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">27,109</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The following table provides a reconciliation of total shareholders’ equity attributable to Diebold, Incorporated and the noncontrolling interests for the nine months ended September 30, 2009: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="80%">  <tr valign="bottom"> <td width="54%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="2%">   </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="2%">   </td> <td width="2%"> </td> <td width="10%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Total Diebold,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Incorporated</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Noncontrolling</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Total Equity</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">  <b>Shareholders’ Equity</b>  </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Interests</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of January 1, 2009</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">964,258</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">946,601</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">17,657</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net income </div></td> <td> </td> <td> </td> <td align="right">29,067</td> <td> </td> <td> </td> <td> </td> <td align="right">24,923</td> <td> </td> <td> </td> <td> </td> <td align="right">4,144</td> <td> </td> </tr> <tr valign="bottom" style="line-height: 6pt"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other comprehensive income: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Foreign currency hedges and translation </div></td> <td> </td> <td> </td> <td align="right">101,386</td> <td> </td> <td> </td> <td> </td> <td align="right">99,639</td> <td> </td> <td> </td> <td> </td> <td align="right">1,747</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Interest rate hedges </div></td> <td> </td> <td> </td> <td align="right">1,296</td> <td> </td> <td> </td> <td> </td> <td align="right">1,296</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Pensions and other postretirement benefits </div></td> <td> </td> <td> </td> <td align="right">2,965</td> <td> </td> <td> </td> <td> </td> <td align="right">2,965</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Comprehensive income </div></td> <td> </td> <td> </td> <td align="right">134,714</td> <td> </td> <td> </td> <td> </td> <td align="right">128,823</td> <td> </td> <td> </td> <td> </td> <td align="right">5,891</td> <td> </td> </tr> <tr valign="bottom" style="line-height: 6pt"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Common shares </div></td> <td> </td> <td> </td> <td align="right">337</td> <td> </td> <td> </td> <td> </td> <td align="right">337</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Additional capital </div></td> <td> </td> <td> </td> <td align="right">10,200</td> <td> </td> <td> </td> <td> </td> <td align="right">10,200</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Treasury shares </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,879</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,879</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Dividends declared </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(52,077</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(52,077</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Distribution to noncontrolling interest holders </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(539</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(539</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of September 30, 2009</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">1,055,014</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,032,005</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">23,009</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 4: SHARE-BASED COMPENSATION</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">The Company’s share-based compensation payments to employees are recognized in the statement of income based on their grant-date fair values during the period in which the employee is required to provide services in exchange for the award. Share-based compensation is recognized as a component of selling and administrative expense. Total share-based compensation expense for the three and nine months ended September 30, 2010 was $3,155 and $9,520, respectively. Total share-based compensation expense for the three and nine months ended September 30, 2009 was $2,841 and $8,898, respectively. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Options outstanding and exercisable as of September 30, 2010 under the Company’s 1991 Equity and Performance Incentive Plan (as Amended and Restated as of April 13, 2009) and changes during the nine months ended September 30, 2010, were as follows: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="92%">  <tr valign="bottom"> <td width="40%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%">  </td> <td width="10%"> </td> <td width="1%"> </td> <td width="1%">   </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="1%">   </td> <td width="2%"> </td> <td width="9%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Weighted-</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Weighted-</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Average</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Average</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Remaining</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Aggregate</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Number of</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Exercise</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Contractual</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>Intrinsic</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Shares</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Price</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Term</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value (1)</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>(in thousands)</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>(per share)</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"><b>(in years)</b></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Outstanding at January 1, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">3,103</td> <td> </td> <td> </td> <td align="right" nowrap="nowrap"> $</td> <td align="right">37.84</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expired or forfeited </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(239)</td> <td> </td> <td> </td> <td> </td> <td align="right">41.91</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Exercised </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(67)</td> <td> </td> <td> </td> <td> </td> <td align="right">26.00</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Granted </div></td> <td> </td> <td> </td> <td align="right">411</td> <td> </td> <td> </td> <td> </td> <td align="right">27.88</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Outstanding at September 30, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">3,208</td> <td> </td> <td> </td> <td align="right"> $</td> <td align="right">36.51</td> <td> </td> <td> </td> <td> </td> <td align="right">5</td> <td> </td> <td> </td> <td align="right"> $</td> <td align="right">5,927</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Options exercisable at September 30, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">2,207</td> <td> </td> <td> </td> <td align="right"> $</td> <td align="right">40.25</td> <td> </td> <td> </td> <td> </td> <td align="right">4</td> <td> </td> <td> </td> <td align="right"> $</td> <td align="right">1,851</td> <td> </td> </tr>  </table> </div> <div style="margin-top: 6pt"> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 8pt; text-align: left"> <tr valign="top" style="font-size: 8pt; color: #000000; background: transparent"> <td width="1%" nowrap="nowrap" align="left">(1) </td> <td> <div align="justify">The aggregate intrinsic value represents the total pre-tax intrinsic value (the difference between the closing price of the Company’s common shares on the last trading day of the third quarter of 2010 and the exercise price, multiplied by the number of “in-the-money” options) that would have been received by the option holders had all option holders exercised their options on September 30, 2010. The amount of aggregate intrinsic value will change based on the fair market value of the Company’s common shares. </div></td> </tr> </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Unvested performance shares are based on a maximum potential payout. Actual shares granted at the end of the performance period may be less than the maximum potential payout level depending on achievement of performance share objectives. The following tables summarize information on unvested restricted stock units (RSUs), performance shares and deferred shares for the nine months ended September 30, 2010: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="65%">  <tr valign="bottom"> <td width="65%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="5%">   </td> <td width="1%"> </td> <td width="11%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">   <b>Number of</b>   </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">  <b>Weighted-Average</b>  </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Shares</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">  <b>Grant-Date Fair Value</b>  </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> <b>(in thousands)</b> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>RSUs:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Unvested at January 1, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">470</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">32.64</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Forfeited </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(33)</td> <td> </td> <td> </td> <td> </td> <td align="right">36.66</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Vested </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(88)</td> <td> </td> <td> </td> <td> </td> <td align="right">45.19</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Granted </div></td> <td> </td> <td> </td> <td align="right">249</td> <td> </td> <td> </td> <td> </td> <td align="right">27.16</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Unvested at September 30, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">598</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">29.04</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Performance Shares:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Unvested at January 1, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">719</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">36.70</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Forfeited </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(162)</td> <td> </td> <td> </td> <td> </td> <td align="right">57.16</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Vested </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(52)</td> <td> </td> <td> </td> <td> </td> <td align="right">58.65</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Granted </div></td> <td> </td> <td> </td> <td align="right">237</td> <td> </td> <td> </td> <td> </td> <td align="right">35.89</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Unvested at September 30, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">742</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">31.15</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Director Deferred Shares:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Oustanding at January 1, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">65</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">34.15</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Granted </div></td> <td> </td> <td> </td> <td align="right">25</td> <td> </td> <td> </td> <td> </td> <td align="right">33.28</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Outstanding at September 30, 2010</b> </div></td> <td> </td> <td> </td> <td align="right">90</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">33.91</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 5: INCOME TAXES</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">The effective tax rate on continuing operations for the three months ended September 30, 2010 was 25.0 percent compared to 13.9 percent for the same period of 2009. The effective tax rate on continuing operations for the nine months ended September 30, 2010 was 27.4 percent compared to 23.2 percent for the same period of 2009. The 11.1 and 4.2 percentage point increase in the effective tax rate for the three and nine months ended September 30, 2010, respectively, was due to a higher percentage of income generated in regions with higher statutory tax rates, certain foreign income subject to tax in the United States. and tax benefits in 2009 related to the U.S. research and development credit and certain look-through rules that expired in 2010. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">As previously noted, the tax rates for the three months and nine months ended September 30, 2009 included benefits related to the U.S. research and development credit and certain “look-through” rules related to foreign corporations, which expired on December 31, 2009. These benefits are not incorporated into the Company’s 2010 results as they have not been extended by the U.S. Congress. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Additionally, in March 2010, the Patient Protection and Affordable Care Act as well as the Health Care and Education Reconciliation Act of 2010 (the Acts) were signed into law. Beginning in 2013, the Acts eliminate the tax deduction of retiree prescription drug expenses that are reimbursed under Medicare Part D. The resulting deferred tax charge of $339 from enactment of the Acts was recognized in the results for the nine months ended September 30, 2010. </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 6: INVESTMENTS</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">The Company’s investments, primarily in Brazil, consist of certificates of deposit and U.S. dollar indexed bond funds, which are classified as available-for-sale and stated at fair value based upon quoted market prices and net asset values, respectively. Unrealized gains and losses are recorded in other comprehensive income. Realized gains and losses are recognized in investment income. Realized gains, net from the sale of securities for the nine months ended September 30, 2010 were $33. Proceeds from the sale of available-for-sale securities were $35,624 during the nine months ended September 30, 2010. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company has deferred compensation plans that enable certain employees to defer receipt of a portion of their cash or share-based compensation and non-employee directors to defer receipt of director fees at the participants’ discretion. For deferred cash-based compensation, the Company established a rabbi trust which is recorded at fair value of the underlying securities within securities and other investments. The related deferred compensation liability is recorded at fair value within other long-term liabilities. Realized and unrealized gains and losses on marketable securities in the rabbi trust are recognized in investment income. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company’s investments, excluding cash surrender value of insurance contracts of $66,299 and $65,489 as of September 30, 2010 and December 31, 2009, respectively, consist of the following: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="55%">  <tr valign="bottom"> <td width="46%"> </td> <td width="5%">    </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="5%">   </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="5%">   </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2">  <b>Unrealized</b>  </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">  <b>Cost Basis</b>  </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Loss</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000">  <b>Fair Value</b>  </td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>As of September 30, 2010</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Short-term investments: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:22px; text-indent:-15px">Certificates of deposit </div></td> <td> </td> <td align="right">  $</td> <td align="right">183,561</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">-    </td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">183,561</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:22px; text-indent:-15px">U.S. dollar indexed bond funds </div></td> <td> </td> <td> </td> <td align="right">12,500</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(607</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">11,893</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right">  $</td> <td align="right">196,061</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(607</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">  $</td> <td align="right">195,454</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Long-term investments: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:22px; text-indent:-15px">Assets held in a rabbi trust </div></td> <td> </td> <td align="right">  $</td> <td align="right">8,363</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(421</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">  $</td> <td align="right">7,942</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>As of December 31, 2009</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Short-term investments: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:22px; text-indent:-15px">Certificates of deposit </div></td> <td> </td> <td align="right">  $</td> <td align="right">157,216</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">-    </td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">157,216</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:22px; text-indent:-15px">U.S. dollar indexed bond funds </div></td> <td> </td> <td> </td> <td align="right">20,226</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> <td> </td> <td> </td> <td align="right">20,226</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right">  $</td> <td align="right">177,442</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">-    </td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">177,442</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Long-term investments: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:22px; text-indent:-15px">Assets held in a rabbi trust </div></td> <td> </td> <td align="right">  $</td> <td align="right">9,400</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">  $</td> <td align="right">(900</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">  $</td> <td align="right">8,500</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 7: INVENTORIES</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">Major classes of inventories are summarized as follows: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="70%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="5%" nowrap="nowrap">          </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">  <b>September 30, 2010</b>  </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">  <b>December 31, 2009</b>  </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Finished goods </div></td> <td> </td> <td align="right">  $</td> <td align="right">216,449</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">196,110</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Service parts </div></td> <td> </td> <td> </td> <td align="right">168,094</td> <td> </td> <td> </td> <td> </td> <td align="right">168,281</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Raw materials and work in process </div></td> <td> </td> <td> </td> <td align="right">100,286</td> <td> </td> <td> </td> <td> </td> <td align="right">83,852</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Total inventories </div></td> <td> </td> <td align="right">  $</td> <td align="right">484,829</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">448,243</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 8: OTHER ASSETS</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">Included in other assets are net capitalized software development costs of $57,193 and $57,143 as of September 30, 2010 and December 31, 2009, respectively. Amortization expense on capitalized software of $4,562 and $12,492 was included in product cost of sales for the three and nine months ended September 30, 2010, respectively and $4,288 and $12,536 for the three and nine months ended September 30, 2009, respectively. Other long-term assets also consist of patents, trademarks and other intangible assets. Where applicable, other assets are stated at cost and, if applicable, are amortized ratably over the relevant contract period or the estimated life of the assets. Fees to renew or extend the term of the Company’s intangible assets are expensed when incurred. Impairment of long-lived assets is recognized when events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If the expected future undiscounted cash flows are less than the carrying amount of the asset group, an impairment loss may be recognized at that time to reduce the asset to its fair value in accordance with FASB ASC 360, <i>Property, Plant and Equipment</i>. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In the third quarter of 2010, the Company recorded a $3,000 other-than-temporary impairment within Diebold North America (DNA) continuing operations related to a cost method investment. The Company determined this investment was fully impaired as of September 30, 2010 due to a decline in fair value. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In the second quarter of 2010, the Company recorded a $4,096 intangible asset impairment within DNA continuing operations related to the 2004 acquisition of TFE Technology Holdings, a maintenance provider of network and hardware service solutions to federal and state government agencies and commercial firms. The impairment was a result of negative cash flows which were projected to persist related to this business due to non-renewal of certain contracts. Based on an analysis of the discounted and undiscounted future cash flows related to this business, the Company determined these customer contract intangible assets were fully impaired as of June 30, 2010. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>Investment in Affiliate </b>Investment in the Company’s non-consolidated affiliate is accounted for under the equity method and consists of a 50 percent ownership in Shanghai Diebold King Safe Company, Ltd. The balance of this investment as of September 30, 2010 and December 31, 2009 was $11,242 and $11,308, respectively, and fluctuated based on equity earnings and dividends. Equity earnings from the non-consolidated affiliate are included in miscellaneous, net in the condensed consolidated statements of income and were $680 and $2,106 for the three and nine months ended September 30, 2010, respectively, and $447 and $1,720 for the three and nine months ended September 30, 2009, respectively. The non-consolidated affiliate declared dividends of $2,172 for both the three and nine months ended September 30, 2010. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 9: DEBT</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Outstanding debt balances were as follows: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="70%">  <tr valign="bottom"> <td width="66%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="5%" nowrap="nowrap">     </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">  <b>September 30, 2010</b>  </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">  <b>December 31, 2009</b>  </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Notes payable - current: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Uncommitted lines of credit </div></td> <td> </td> <td align="right">$</td> <td align="right">611</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">16,915</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Long-term debt: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Credit facility </div></td> <td> </td> <td align="right">$</td> <td align="right">293,050</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">240,000</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Senior notes </div></td> <td> </td> <td> </td> <td align="right">300,000</td> <td> </td> <td> </td> <td> </td> <td align="right">300,000</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Industrial development revenue bonds </div></td> <td> </td> <td> </td> <td align="right">11,900</td> <td> </td> <td> </td> <td> </td> <td align="right">11,900</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Other </div></td> <td> </td> <td> </td> <td align="right">2,831</td> <td> </td> <td> </td> <td> </td> <td align="right">1,108</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:30px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right">$</td> <td align="right">607,781</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">553,008</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">As of September 30, 2010, the Company had various international short-term uncommitted lines of credit with borrowing limits of $67,973. The weighted-average interest rate on outstanding borrowings on these lines of credit as of September 30, 2010 and December 31, 2009 was 14.00 and 9.15 percent, respectively. Short-term uncommitted lines mature in less than one year. The amount available under the short-term uncommitted lines at September 30, 2010 was $67,362. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In October 2009, the Company entered into a three-year credit facility. As of September 30, 2010, the Company had borrowing limits under this facility totaling $502,240 ($400,000 and €75,000, translated). Under the terms of the credit facility agreement, the Company has the ability, subject to various approvals, to increase the borrowing limits by $200,000 and €37,500, respectively. Up to $30,000 and €15,000 of the revolving credit facility is available under a swing line subfacility. The weighted-average interest rate on outstanding credit facility borrowings as of September 30, 2010 and December 31, 2009 was 2.72 and 2.63 percent, respectively, which is variable based on the London Interbank Offered Rate (LIBOR). The amount available under the credit facility as of September 30, 2010 was $209,190. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In March 2006, the Company issued senior notes in an aggregate principal amount of $300,000 with a weighted-average fixed interest rate of 5.50 percent. The maturity dates of the senior notes are staggered, with $75,000, $175,000 and $50,000 becoming due in 2013, 2016 and 2018, respectively. Additionally, the Company entered into a derivative transaction to hedge interest rate risk on $200,000 of the senior notes, which was treated as a cash flow hedge. This reduced the effective interest rate by 14 basis points from 5.50 to 5.36 percent. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In 1997, industrial development revenue bonds were issued on behalf of the Company. The proceeds from the bond issuances were used to construct new manufacturing facilities in the United States. The Company guaranteed the payments of principal and interest on the bonds by obtaining letters of credit. The bonds were issued with a 20-year original term and are scheduled to mature in 2017. Each industrial development revenue bond carries a variable interest rate, which is reset weekly by the remarketing agents. The weighted-average interest rate on the bonds was 0.57 and 0.80 percent as of September 30, 2010 and December 31, 2009, respectively. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company’s financing agreements contain various restrictive financial covenants, including net debt to capitalization and net interest coverage ratios. As of September 30, 2010, the Company was in compliance with the financial covenants in its debt agreements. </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 10: BENEFIT PLANS</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">The Company has pension plans covering certain U.S. employees. Plans that cover certain salaried employees provide pension benefits based on the employee’s compensation during the ten years before retirement. The Company’s funding policy for salaried plans is to contribute annually based on actuarial projections and applicable regulations. Plans covering certain hourly employees and union members generally provide benefits of stated amounts for each year of service. The Company’s funding policy for hourly plans is to make at least the minimum annual contributions required by applicable regulations. Employees of the Company’s operations in countries outside of the United States participate to varying degrees in local pension plans, which in the aggregate are not significant. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In addition to providing pension benefits, the Company provides healthcare and life insurance benefits (referred to as other benefits) for certain retired employees. Eligible employees may be entitled to these benefits based upon years of service with the Company, age at retirement and collective bargaining agreements. Currently, the Company has made no commitments to increase these benefits for existing retirees or for employees who may become eligible for these benefits in the future. There are no plan assets and the Company funds the benefits as the claims are paid. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The following table sets forth the net periodic benefit cost for the Company’s defined benefit pension plans and other benefits: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="90%">  <tr valign="bottom"> <td width="36%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="15"><b>Three Months Ended</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="15" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Pension Benefits</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Other Benefits</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Components of net periodic benefit cost</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Service cost </div></td> <td> </td> <td align="right">  $</td> <td align="right">2,500</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">2,726</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">-    </td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Interest cost </div></td> <td> </td> <td> </td> <td align="right">7,680</td> <td> </td> <td> </td> <td> </td> <td align="right">7,236</td> <td> </td> <td> </td> <td> </td> <td align="right">249</td> <td> </td> <td> </td> <td> </td> <td align="right">282</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expected return on plan assets </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(9,604)</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(9,244)</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Amortization of prior service cost </div></td> <td> </td> <td> </td> <td align="right">48</td> <td> </td> <td> </td> <td> </td> <td align="right">68</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(130</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(130</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Recognized net actuarial loss </div></td> <td> </td> <td> </td> <td align="right">1,512</td> <td> </td> <td> </td> <td> </td> <td align="right">1,122</td> <td> </td> <td> </td> <td> </td> <td align="right">71</td> <td> </td> <td> </td> <td> </td> <td align="right">110</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net periodic pension benefit cost</b> </div></td> <td> </td> <td align="right">  $</td> <td align="right">2,136</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">1,908</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">190</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">262</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>   <tr valign="bottom" style="font-size: 18pt"> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="15"><b>Nine Months Ended</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="15" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Pension Benefits</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Other Benefits</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Components of net periodic benefit cost</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Service cost </div></td> <td> </td> <td align="right">  $</td> <td align="right">7,498</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">8,177</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">-    </td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Interest cost </div></td> <td> </td> <td> </td> <td align="right">23,042</td> <td> </td> <td> </td> <td> </td> <td align="right">21,710</td> <td> </td> <td> </td> <td> </td> <td align="right">745</td> <td> </td> <td> </td> <td> </td> <td align="right">845</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expected return on plan assets </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(28,810)</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(27,730)</td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> <td> </td> <td> </td> <td align="right">-    </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Amortization of prior service cost </div></td> <td> </td> <td> </td> <td align="right">145</td> <td> </td> <td> </td> <td> </td> <td align="right">203</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(388</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(388</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Recognized net actuarial loss </div></td> <td> </td> <td> </td> <td align="right">4,229</td> <td> </td> <td> </td> <td> </td> <td align="right">2,819</td> <td> </td> <td> </td> <td> </td> <td align="right">213</td> <td> </td> <td> </td> <td> </td> <td align="right">331</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net periodic pension benefit cost</b> </div></td> <td> </td> <td align="right">  $</td> <td align="right">6,104</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">5,179</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">570</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">788</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 8pt"><b>Cash Flows</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 0pt">There have been no significant changes to the 2010 plan year contribution amounts previously disclosed. For the nine months ended September 30, 2010 and 2009, contributions of $14,673 and $16,978, respectively, were made to the qualified and non-qualified pension plans. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In addition to the qualified and non-qualified pension plans, union employees in one of the Company’s U.S. manufacturing facilities participated in the International Union of Electronic, Electrical, Salaried, Machine and Furniture Workers-Communications Workers of America (IUE-CWA) multi-employer pension fund. This facility was closed in 2008 which triggered a withdrawal liability from the pension fund. The withdrawal liability was settled for $5,632 and was paid in the second quarter of 2010. </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 11: GUARANTEES AND PRODUCT WARRANTIES</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">In September 2009, the Company sold its U.S. election systems business. The related sale agreement contained shared liability clauses pursuant to which the Company agreed to indemnify the purchaser for 70 percent of any adverse consequences to the purchaser arising out of certain defined potential litigation or obligations. As of September 30, 2010, there were no material adverse consequences related to these shared liability indemnifications. The Company’s maximum exposure under the shared liability indemnifications is $8,000. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">In 1997, industrial development revenue bonds were issued on behalf of the Company. The Company guaranteed the payments of principal and interest on the bonds (refer to note 9) by obtaining letters of credit. The carrying value of the bonds was $11,900 as of September 30, 2010 and December 31, 2009. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company provides its global operations guarantees and standby letters of credit through various financial institutions to suppliers, customers, regulatory agencies and insurance providers. If the Company is not able to make payment or fulfill contractual obligations, the suppliers, customers, regulatory agencies and insurance providers may draw on the pertinent bank. At September 30, 2010, the maximum future payment obligations related to these various guarantees totaled $70,036, of which $23,202 represented standby letters of credit to insurance providers, and no associated liability was recorded. At December 31, 2009, the maximum future payment obligations relative to these various guarantees totaled $53,419, of which $22,628 represented standby letters of credit to insurance providers, and no associated liability was recorded. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company provides its customers a manufacturer’s warranty and records, at the time of the sale, a corresponding estimated liability for potential warranty costs. Estimated future obligations due to warranty claims are based upon historical factors such as labor rates, average repair time, travel time, number of service calls per machine and cost of replacement parts. Changes in the Company’s warranty liability balance are illustrated in the following table: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="50%">  <tr valign="bottom"> <td width="50%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="15%"> </td> <td width="1%"> </td> <td width="5%">    </td> <td width="1%"> </td> <td width="15%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance at January 1</b> </div></td> <td> </td> <td align="right">  $</td> <td align="right">62,673</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">43,009</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Current period accruals (a) </div></td> <td> </td> <td> </td> <td align="right">50,409</td> <td> </td> <td> </td> <td> </td> <td align="right">50,186</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Current period settlements </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(41,343)</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(34,941)</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance at September 30</b> </div></td> <td> </td> <td align="right">  $</td> <td align="right">71,739</td> <td> </td> <td> </td> <td align="right">  $</td> <td align="right">58,254</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 8pt; margin-top: 6pt">(a) includes the impact of foreign exchange rate fluctuations </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 12: DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">The Company uses derivatives to mitigate the economic consequences associated with the fluctuations in currencies and interest rates. The Company records all derivative instruments on the balance sheet at fair value and the changes in the fair value are recognized in earnings unless specific hedge accounting criteria are met. Special accounting for qualifying hedges allows derivative gains and losses to be reflected in the statement of income or other comprehensive income together with the hedged exposure, and requires that the Company formally document, designate and assess the effectiveness of transactions that receive hedge accounting treatment. Gains or losses associated with ineffectiveness must be reported currently in earnings. The Company does not enter into any speculative positions with regard to derivative instruments. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company periodically evaluates its monetary asset and liability positions denominated in foreign currencies. The impact of the Company and the counterparties’ credit risk on the fair value of the contracts is considered as well as the ability of each party to execute its obligations under the contract. The Company uses investment grade financial counterparties in these transactions and believes that the resulting credit risk under these hedging strategies is not significant. </div> <div align="left" style="font-size: 10pt; margin-top: 8pt"><b>FOREIGN EXCHANGE</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt"><b>Non-Designated Hedges </b>A substantial portion of the Company’s operations and revenues are international. As a result, changes in foreign exchange rates can create substantial foreign exchange gains and losses from the revaluation of non-functional currency monetary assets and liabilities. The Company’s policy allows the use of foreign exchange forward contracts with maturities of up to 24 months to mitigate the impact of currency fluctuations on those foreign currency asset and liability balances. The Company elected not to apply hedge accounting to its foreign exchange forward contracts. Thus, spot-based gains/losses offset revaluation gains/losses within foreign exchange loss, net and forward-based gains/losses represent interest expense. For the three and nine months ended September 30, 2010, there were 229 and 636 non-designated foreign exchange contracts that settled, respectively. As of September 30, 2010, there were 54 non-designated foreign exchange contracts outstanding, primarily euro, British pound and Swiss franc, totaling $507,731, which represents the absolute value of notional amounts. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>Net Investment Hedges </b>The Company has international subsidiaries with assets in excess of liabilities that generate cumulative translation adjustments within other comprehensive income. During 2009, the Company used derivatives to manage potential adverse changes in value of its net investments in Brazil. The Company used the forward to forward method for its quarterly retrospective and prospective assessments of hedge effectiveness. No ineffectiveness results if the notional amount of the derivative matches the portion of the net investment designated as being hedged because the Company uses derivative instruments with underlying exchange rates consistent with its functional currency and the functional currency of the hedged net investment. Changes in value that are deemed effective are accumulated in other comprehensive income where they will remain until they are reclassified to income together with the gain or loss on the entire investment upon substantial liquidation of the subsidiary. </div> <div align="left" style="font-size: 10pt; margin-top: 8pt"><b>INTEREST RATE</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt"><b>Cash Flow Hedges </b>The Company has variable rate debt and is subject to fluctuations in interest related cash flows due to changes in market interest rates. The Company’s policy allows derivative instruments designated as cash flow hedges which fix a portion of future variable-rate interest expense. The Company has executed two pay-fixed receive-variable interest rate swaps, with a total notional amount of $50,000, to hedge against changes in the LIBOR benchmark interest rate on a portion of the Company’s LIBOR-based borrowings. In October 2009, the Company used borrowings of approximately $205,000 and €50,300 under its new credit facility to repay all amounts outstanding under (and terminated) the prior credit facility. While the LIBOR-based cash flows designated in the original hedge relationships remain probable of occurring, the Company elected to de-designate the original cash flow hedging relationships and designated new hedging relationships in conjunction with entering into its new credit facility. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The Company’s monthly retrospective assessment of hedge effectiveness to determine whether the hedging relationship continues to qualify for hedge accounting is performed using regression analysis. The Company’s monthly prospective assessment of hedge effectiveness to measure the extent to which exact offset is not achieved is performed by comparing the cumulative change in the fair value of the interest rate swaps to the cumulative change in the fair value of the hypothetical interest rate swaps with critical terms that match the LIBOR-based borrowings. When computing cumulative changes in fair values, the Company computes the difference between the current fair value and the sum of all future discounted cash flows projected at designation that are not yet paid or accrued as of the current valuation date in order to isolate changes in fair value primarily attributable to changes in interest rates. Changes in value that are deemed effective are accumulated in other comprehensive income and reclassified to interest expense when the hedged interest is accrued. For the three and nine months ended September 30, 2010, the Company recognized net losses of $228 and $307 representing the change in fair value of the interest rate swap that was deemed ineffective. To the extent that it becomes probable that the Company’s variable rate borrowings will not occur, the gains or losses on the related cash flow hedges will be reclassified from other comprehensive income to interest expense. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">In December 2005 and January 2006, the Company executed cash flow hedges by entering into receive-variable and pay-fixed interest rate swaps, with a total notional amount of $200,000, related to the senior notes issuance in March 2006. Amounts previously recorded in other comprehensive income related to the pre-issuance cash flow hedges will continue to be reclassified to income on a straight-line basis through February 2016. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The following table summarizes the fair value of derivative instruments designated and not designated as hedging instruments and their respective balance sheet location: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="94%">  <tr valign="bottom"> <td width="40%"> </td> <td width="3%">    </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="3%">    </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="3%">    </td> <td width="7%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>September 30, 2010</b></td> <td style="border-bottom: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>December 31, 2009</b></td> <td style="border-bottom: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Balance Sheet Location (1)</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Derivatives designated as hedging instruments</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:24px; text-indent:-15px">Liability derivatives: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:36px; text-indent:-15px">Interest rate contracts </div></td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(1,348</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(2,122</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom">Other current liabilities</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:36px; text-indent:-15px">Interest rate contracts </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(3,137</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,277</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom">Other long-term liabilities</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:24px; text-indent:-15px">Total liability derivatives </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(4,485</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(3,399</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total derivatives designated</b> </div></td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(4,485</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(3,399</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Derivatives not designated as hedging instruments</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:24px; text-indent:-15px">Asset derivatives: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:36px; text-indent:-15px">Foreign exchange contracts </div></td> <td> </td> <td align="left">  $</td> <td align="right">2,537</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1,047</td> <td> </td> <td> </td> <td align="left" valign="bottom">Other current assets</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:36px; text-indent:-15px">Foreign exchange contracts </div></td> <td> </td> <td> </td> <td align="right">1,100</td> <td> </td> <td> </td> <td> </td> <td align="right">399</td> <td> </td> <td> </td> <td align="left" valign="bottom">Other current liabilities</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:24px; text-indent:-15px">Total asset derivatives </div></td> <td> </td> <td> </td> <td align="right">3,637</td> <td> </td> <td> </td> <td> </td> <td align="right">1,446</td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:24px; text-indent:-15px">Liability derivatives: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:36px; text-indent:-15px">Foreign exchange contracts </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(999</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(560</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom">Other current assets</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:36px; text-indent:-15px">Foreign exchange contracts </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(3,858</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(2,171</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom">Other current liabilities</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:24px; text-indent:-15px">Total liability derivatives </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(4,857</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(2,731</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total derivatives not designated</b> </div></td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(1,220</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(1,285</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total derivatives</b> </div></td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(5,705</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(4,684</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left" valign="bottom"> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td align="left" valign="bottom"> </td> </tr>  </table> </div> <div align="left"> <div style="font-size: 10pt; margin-top: 0pt; width: 18%; border-top: 0px solid #000000">  </div> </div> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 8pt; text-align: left"> <tr> <td width="1%"></td> <td width="98"></td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(1) </td> <td> <div style="text-align: justify">The balance sheet location noted above represents the balance sheet line item where the respective contract types are reported using a net basis due to master netting agreements with counterparties. However, the asset derivative and liability derivative categories noted above represent the Company’s derivative positions on a gross contract by contract basis. </div></td> </tr> </table>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 20pt">The following tables summarize the gain (loss) recognized on designated derivative instruments: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="98%">  <tr valign="bottom"> <td width="52%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Three Months Ended</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Nine Months Ended</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Interest rate contracts</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">(Loss) gain recognized in OCI (effective portion) </div></td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(127</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(419</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(778</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left">  $</td> <td align="right">1,090</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Gain (loss) reclassified from accumulated OCI (effective portion) </div></td> <td> </td> <td> </td> <td align="right">100</td> <td> </td> <td> </td> <td> </td> <td align="right">8</td> <td> </td> <td> </td> <td> </td> <td align="right">269</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(206</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Loss recognized in income (ineffective portion) </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(228</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(307</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> </tr> <tr> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Foreign exchange contracts</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Loss recognized in OCI (effective portion) </div></td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(2,051</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(4,533</td> <td nowrap="nowrap">)</td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">Gains and losses related to interest rate contracts that are reclassified from accumulated OCI are recorded in interest expense on the statement of income. The Company anticipates reclassifying $1,019 from other comprehensive income to interest expense within the next 12 months. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The following table summarizes the gain (loss) recognized on non-designated derivative instruments: </div> <div align="left" style="margin-left: 1%"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="94%">  <tr valign="bottom"> <td width="36%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="18%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Three Months Ended</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Nine Months Ended</b></td> <td> </td> <td nowrap="nowrap" align="center"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td nowrap="nowrap" align="center"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Income Statement Location</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign exchange contracts </div></td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(1,805</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(2,250</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(4,864</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(7,445</td> <td nowrap="nowrap">)</td> <td> </td> <td align="center" valign="bottom">Interest expense</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign exchange contracts </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(12,285</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">366</td> <td> </td> <td> </td> <td> </td> <td align="right">9,870</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(17,622</td> <td nowrap="nowrap">)</td> <td> </td> <td align="center" valign="bottom" nowrap="nowrap">Foreign exchange gain (loss), net</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td align="center" valign="bottom"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(14,090</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(1,884</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left">  $</td> <td align="right">5,006</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">  $</td> <td align="right">(25,067</td> <td nowrap="nowrap">)</td> <td> </td> <td align="center" valign="bottom"> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td align="center" valign="bottom"> </td> </tr>  </table> </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 13:   RESTRUCTURING AND OTHER CHARGES</b> </div> <div align="left" style="font-size: 10pt; margin-top: 5pt"><b>Restructuring Charges</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 5pt">The following table summarizes the impact of the Company’s restructuring charges (benefits) on the condensed consolidated statements of income: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="85%">  <tr valign="bottom"> <td width="52%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Three Months Ended</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Nine Months Ended</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Cost of sales - products </div></td> <td> </td> <td align="left">  $</td> <td align="right">305</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">700</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">787</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">3,104</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Cost of sales - services </div></td> <td> </td> <td> </td> <td align="right">35</td> <td> </td> <td> </td> <td> </td> <td align="right">536</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(175</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">3,936</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Selling and administrative expense </div></td> <td> </td> <td> </td> <td align="right">100</td> <td> </td> <td> </td> <td> </td> <td align="right">411</td> <td> </td> <td> </td> <td> </td> <td align="right">2,336</td> <td> </td> <td> </td> <td> </td> <td align="right">3,086</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Research, development and engineering expense </div></td> <td> </td> <td> </td> <td align="right">43</td> <td> </td> <td> </td> <td> </td> <td align="right">125</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(155</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">102</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td align="left">  $</td> <td align="right">483</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1,772</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">2,793</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">10,228</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The following table summarizes the Company’s restructuring charges (benefits) within continuing operations for its DNA and DI reporting segments: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="85%">  <tr valign="bottom"> <td width="52%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Three Months Ended</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Nine Months Ended</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">DNA </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Severance </div></td> <td> </td> <td align="left">  $</td> <td align="right">352</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">583</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">2,235</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">2,777</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Other (1) </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(98</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">774</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(215</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">2,908</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">DI </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Severance </div></td> <td> </td> <td> </td> <td align="right">178</td> <td> </td> <td> </td> <td> </td> <td align="right">187</td> <td> </td> <td> </td> <td> </td> <td align="right">556</td> <td> </td> <td> </td> <td> </td> <td align="right">3,900</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Other (2) </div></td> <td> </td> <td> </td> <td align="right">51</td> <td> </td> <td> </td> <td> </td> <td align="right">228</td> <td> </td> <td> </td> <td> </td> <td align="right">217</td> <td> </td> <td> </td> <td> </td> <td align="right">643</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:30px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td align="left">  $</td> <td align="right">483</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1,772</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">2,793</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">10,228</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left"> <div style="font-size: 1pt; margin-top: 12pt; width: 80%; border-top: 1px solid #000000">  </div> </div> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 8pt; text-align: left"> <tr> <td width="2%"></td> <td width="1%"></td> <td width="96"></td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(1)</td> <td> </td> <td> <div style="text-align: justify">Net other restructuring charges (benefits) included in the DNA segment include pension obligation, gain on sale of assets and costs to move products. </div></td> </tr> <tr style="font-size: 2pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(2)</td> <td> </td> <td> <div style="text-align: justify">Net other restructuring charges included in the DI segment include legal and professional fees. </div></td> </tr> </table> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Net restructuring charges of $2,354 and $4,098 for the nine months ended September 30, 2010 and 2009, respectively, related to reductions in the Company’s global workforce, including realignment of the organization and resources to better support opportunities in emerging growth markets and consolidation of certain international facilities in efforts to optimize overall operational performance. In December 2009, the Company began to implement a workforce reduction of 350 employees, which primarily affects its Canton, Ohio area facilities. The Company expects to complete this workforce reduction no later than the end of 2010. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Net restructuring charges of $408 and $2,859 for the nine months ended September 30, 2010 and 2009, respectively, related to the Company’s strategic global manufacturing realignment plans. The Company’s global manufacturing realignment plans include the closure of its manufacturing facilities in Newark, Ohio and Cassis, France in 2008 and 2006, respectively as well as the movement of Opteva product manufacturing out of Lexington, North Carolina in 2009. The Company believes these plans are substantially complete. Security manufacturing operations continue in the Lexington facility. Restructuring charges in 2010 were primarily the result of legal and professional fees related to these plans. These charges were partially offset by benefits related to a pension obligation which was settled in the first quarter of 2010 (refer to note 10) and a gain on the sale of assets. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Other restructuring charges were $31 and $3,271 for the nine months ended September 30, 2010 and 2009, respectively. The 2009 costs were primarily related to employee severance costs in connection with the Company’s sale of a manufacturing facility in Argentina. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The following table summarizes the Company’s cumulative total restructuring costs for the significant plans: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="75%">  <tr valign="bottom"> <td width="72%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="10%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Global</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 0px solid #000000"><b>Workforce</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Manufacturing</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Reductions</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Realignment</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Costs incurred to date: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">DNA </div></td> <td> </td> <td align="left">  $</td> <td align="right">20,441</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">12,430</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">DI </div></td> <td> </td> <td> </td> <td align="right">19,743</td> <td> </td> <td> </td> <td> </td> <td align="right">24,767</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Total costs incurred to date </div></td> <td> </td> <td align="left">  $</td> <td align="right">40,184</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">37,197</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Remaining costs: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">DNA </div></td> <td> </td> <td align="left">  $</td> <td align="right">250</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">62</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">DI </div></td> <td> </td> <td> </td> <td align="right">250</td> <td> </td> <td> </td> <td> </td> <td align="right">410</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:30px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Remaining costs as of September 30, 2010 </div></td> <td> </td> <td align="left">  $</td> <td align="right">500</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">472</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The following table summarizes the Company’s restructuring accrual balances and related activity for the nine months ended September 30, 2010: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="75%">  <tr valign="bottom"> <td width="64%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Severance</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Other</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Total</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of January 1, 2010</b> </div></td> <td> </td> <td align="left">  $</td> <td align="right">15,195</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">6,722</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">21,917</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Liabilities incurred/changes in estimates </div></td> <td> </td> <td> </td> <td align="right">2,791</td> <td> </td> <td> </td> <td> </td> <td align="right">2</td> <td> </td> <td> </td> <td> </td> <td align="right">2,793</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Liabilities paid </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(14,642</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(6,724</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(21,366</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of September 30, 2010</b> </div></td> <td> </td> <td align="left">  $</td> <td align="right">3,344</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">3,344</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 12pt"><b>Other Charges and Expense Reimbursements</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 5pt">Other charges and expense reimbursements consist of items that the Company determines are non-routine in nature and are not expected to recur in future operations. Net non-routine income of $4,130 impacted the nine months ended September 30, 2010 compared to net non-routine expenses of $15,005 in the same period of 2009. Net non-routine income for 2010 consisted primarily of reimbursements from the Company’s director and officer (D&O) insurance carriers related to legal and other expenses incurred as part of the SEC and Department of Justice (DOJ) investigations (government investigations) and was recorded in selling and administrative expense. The Company continues to pursue reimbursement with its D&O insurance carriers of approximately $6,900 of previously incurred legal and other expenditures related to the government investigations. In June 2010, the SEC finalized the settlement of civil charges stemming from the government investigations. The Company had previously reached an agreement in principle in 2009 with the staff of the SEC and the Company accrued a $25,000 penalty in the first quarter of 2009, which was paid in June 2010. Net non-routine expenses in 2009 consisted of $1,328 in legal and other consultation fees recorded in selling and administrative expense related to the government investigations and a $25,000 charge, recorded in miscellaneous, net, related to the 2009 agreement in principle with the staff of the SEC to settle civil charges. In addition, in 2009 selling and administrative expense was offset by $11,323 of non-routine income, primarily related to reimbursements from the Company’s D&O insurance carriers related to legal and other expenses incurred as part of the government investigations. </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>NOTE 14: FAIR VALUE OF ASSETS AND LIABILITIES</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 5pt">The Company measures its financial assets and liabilities using one or more of the following three valuation techniques: </div> <div style="margin-top: 8pt"> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left"> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="1%" style="background: transparent"> </td> <td width="1%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td> <div style="text-align: justify"><u>Market approach</u> — Prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. </div></td> </tr> <tr> <td style="font-size: 5pt"> </td> </tr> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="1%" style="background: transparent"> </td> <td width="1%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td> <div style="text-align: justify"><u>Cost approach</u> — Amount that would be required to replace the service capacity of an asset (replacement cost). </div></td> </tr> <tr> <td style="font-size: 5pt"> </td> </tr> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="1%" style="background: transparent"> </td> <td width="1%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td> <div style="text-align: justify"><u>Income approach</u> — Techniques to convert future amounts to a single present amount based upon market expectations. </div></td> </tr> </table> </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div style="margin-top: 6pt"> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The hierarchy that prioritizes the inputs to valuation techniques used to measure fair value is divided into three levels: </div> <div style="margin-top: 8pt"> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left"> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="1%" style="background: transparent"> </td> <td width="1%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td> <div style="text-align: justify"><u>Level 1</u> — Unadjusted quoted prices in active markets for identical assets or liabilities. </div></td> </tr> <tr> <td style="font-size: 5pt"> </td> </tr> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="1%" style="background: transparent"> </td> <td width="1%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td> <div style="text-align: justify"><u>Level 2</u> — Unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active or inputs, other than quoted prices in active markets, that are observable either directly or indirectly. </div></td> </tr> <tr> <td style="font-size: 5pt"> </td> </tr> <tr valign="top" style="font-size: 10pt; color: #000000; background: transparent"> <td width="1%" style="background: transparent"> </td> <td width="1%" nowrap="nowrap" align="left"><b>•</b></td> <td width="1%"> </td> <td> <div style="text-align: justify"><u>Level 3</u> — Unobservable inputs for which there is little or no market data. </div></td> </tr> </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 12pt"><b>Summary of Assets and Liabilities Recorded at Fair Market Value</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">Assets and liabilities subject to fair value measurement are as follows: </div> <div align="center"> <table style="font-size: 8pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="28%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="6%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="15" style="border-bottom: 1px solid #000000"><b>September 30, 2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="15" style="border-bottom: 1px solid #000000"><b>December 31, 2009</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="11" style="border-bottom: 1px solid #000000"><b>Fair Value Measurements Using</b></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="11" style="border-bottom: 1px solid #000000"><b>Fair Value Measurements Using</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Fair Value</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Level 1</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Level 2</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Level 3</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Fair Value</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Level 1</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Level 2</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Level 3</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Assets</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Short-term investments </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:24px; text-indent:-15px">Certificates of deposit </div></td> <td> </td> <td align="left">  $</td> <td align="right">183,561</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">183,561</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">157,216</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">157,216</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:24px; text-indent:-15px">U.S. dollar indexed bond funds </div></td> <td> </td> <td> </td> <td align="right">11,893</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">11,893</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">20,226</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">20,226</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Assets held in a rabbi trust </div></td> <td> </td> <td> </td> <td align="right">7,942</td> <td> </td> <td> </td> <td> </td> <td align="right">7,942</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">8,500</td> <td> </td> <td> </td> <td> </td> <td align="right">8,500</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign exchange forward contracts </div></td> <td> </td> <td> </td> <td align="right">1,538</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">1,538</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">487</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">487</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Contingent consideration on sale of business </div></td> <td> </td> <td> </td> <td align="right">1,652</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">1,652</td> <td> </td> <td> </td> <td> </td> <td align="right">2,386</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">2,386</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:30px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Total</b> </div></td> <td> </td> <td align="left">  $</td> <td align="right">206,586</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">191,503</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">13,431</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">1,652</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">188,815</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">165,716</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">20,713</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">2,386</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Liabilities</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Deferred compensation </div></td> <td> </td> <td align="left">  $</td> <td align="right">7,942</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">7,942</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">8,500</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">8,500</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign exchange forward contracts </div></td> <td> </td> <td> </td> <td align="right">2,758</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">2,758</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">1,772</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">1,772</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Interest rate swaps </div></td> <td> </td> <td> </td> <td align="right">4,485</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">4,485</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">3,399</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td> </td> <td align="right">3,399</td> <td> </td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:30px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Total</b> </div></td> <td> </td> <td align="left">  $</td> <td align="right">15,185</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">7,942</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">7,243</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">13,671</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">8,500</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">5,171</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">-</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>Short-Term Investments </b>The Company has investments in certificates of deposit that are recorded at cost, which approximates fair value. Additionally, the Company has investments in U.S. dollar indexed bond funds that are classified as available-for-sale and stated at fair value. U.S. dollar indexed bond funds are reported at net asset value, which is the practical expedient for fair value as determined by banks where funds are held. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>Assets Held in a Rabbi Trust / Deferred Compensation </b>The fair value of the assets held in a rabbi trust (refer to note 6) is derived from investments in a mix of money market, fixed income and equity funds managed by Vanguard. The related deferred compensation liability is recorded at fair value. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>Foreign Exchange Forward Contracts </b>A substantial portion of the Company’s operations and revenues are international. As a result, changes in foreign exchange rates can create substantial foreign exchange gains and losses from the revaluation of non-functional currency monetary assets and liabilities. The foreign exchange contracts are valued using the market approach based on observable market transactions of forward rates. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>Interest Rate Swaps </b>The Company has variable rate debt and is subject to fluctuations in interest related cash flows due to changes in market interest rates. The Company’s policy allows it to periodically enter into derivative instruments designated as cash flow hedges to fix some portion of future variable rate based interest expense. The Company has executed two pay-fixed receive-variable interest rate swaps to hedge against changes in the LIBOR benchmark interest rate on a portion of the Company’s LIBOR- based borrowings. The fair value of the swap is determined using the income approach and is calculated based on LIBOR rates at the reporting date. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>Contingent Consideration on Sale of Business </b>The Company’s September 2009 sale of its U.S. elections systems business included contingent consideration related to 70 percent of any cash collected over a five-year period on the accounts receivable balance of the sold business as of August 31, 2009. The fair value of the contingent consideration was determined based on recent collections on the accounts receivable as well as the probability of future anticipated collections (level 3 inputs) and was recorded at the net present value of the future anticipated cash flows. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The following table summarizes the changes in fair value of the Company’s level 3 assets: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="45%">  <tr valign="bottom"> <td width="82%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="13%"> </td> <td width="1%"> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of January 1, 2010</b> </div></td> <td> </td> <td align="left">$</td> <td align="right">2,386</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Cash collections </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1,815</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Fair value adjustments </div></td> <td> </td> <td> </td> <td align="right">1,081</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td nowrap="nowrap" colspan="4" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Balance as of September 30, 2010</b> </div></td> <td> </td> <td align="left">$</td> <td align="right">1,652</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td nowrap="nowrap" colspan="4" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><b>Summary of Assets and Liabilities Recorded at Carrying Value</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 5pt">The fair value of the Company’s cash and cash equivalents, trade receivables and accounts payable, approximates the carrying value due to the relative short maturity of these instruments. The fair value and carrying value of the Company’s debt instruments are summarized as follows: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="75%">  <tr valign="bottom"> <td width="52%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="7%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30, 2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>December 31, 2009</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Carrying</b></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Carrying</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Fair Value</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Value</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Fair Value</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Value</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Current notes payable </div></td> <td> </td> <td align="left">  $  </td> <td align="right">611</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">611</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">16,915</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">16,915</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Long-term debt </div></td> <td> </td> <td> </td> <td align="right">614,656</td> <td> </td> <td> </td> <td> </td> <td align="right">607,781</td> <td> </td> <td> </td> <td> </td> <td align="right">550,254</td> <td> </td> <td> </td> <td> </td> <td align="right">553,008</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total debt instruments </div></td> <td> </td> <td align="left">  $</td> <td align="right">615,267</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">608,392</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">567,169</td> <td> </td> <td> </td> <td align="left">  $</td> <td align="right">569,923</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The fair value of the Company’s industrial development revenue bonds are measured using unadjusted quoted prices in active markets for identical assets categorized as level 1 inputs. The fair value of the Company’s current and long-term credit facility debt instruments approximates the carrying value due to the relative short maturity of the revolving borrowings under these instruments. The fair values of the Company’s long-term senior notes was estimated using market observable inputs for the Company’s comparable peers with public debt, including quoted prices in active markets, market indices and interest rate measurements, considered level 2 inputs. </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="justify" style="font-size: 10pt; margin-top: 8pt"><b>NOTE 15: SEGMENT INFORMATION</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 5pt">In the first quarter of 2010, the Company began management of its businesses on a geographic basis, changing from the previous model of sales channel segments. In order to align the Company’s external reporting of its financial results with this organizational change, the Company has modified its segment reporting. The Company now reports the following two segments: DNA and DI. The Company’s chief operating decision maker regularly assesses information relating to these segments to make decisions, including the allocation of resources. Management evaluates the performance of the segments based on revenue and segment gross margin. Prior period segment information has been reclassified to conform to the current period presentation. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The DNA segment sells and services financial and retail systems in the United States and Canada. The DI segment sells and services financial and retail systems over the remainder of the globe as well as voting and lottery solutions in Brazil. Each segment buys the goods it sells from the Company’s manufacturing plants or through external suppliers. Intercompany sales between legal entities are eliminated in consolidation and intersegment revenue is not significant. Each year, intercompany pricing is agreed upon which drives operating profit contribution. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">The reconciliation between segment information and the condensed consolidated financial statements is disclosed. Revenue summaries by geographic area and product and service solutions are also disclosed. Certain information not routinely used in the management of the DNA and DI segments, information not allocated back to the segments or information that is impractical to report is not shown. Items not allocated are as follows: investment income; interest expense; equity in the net income of investees accounted for by the equity method; income tax expense or benefit; and discontinued operations. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 6pt">The following table presents information regarding the Company’s segment information: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="75%">  <tr valign="bottom"> <td width="41%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="2%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>DNA</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>DI</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Total</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>For the three months ended September 30, 2010</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Customer revenue </div></td> <td> </td> <td align="left">  $  </td> <td align="right">349,673</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">398,947</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">748,620</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Operating profit </div></td> <td> </td> <td> </td> <td align="right">34,270</td> <td> </td> <td> </td> <td> </td> <td align="right">18,109</td> <td> </td> <td> </td> <td> </td> <td align="right">52,379</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Capital expenditures </div></td> <td> </td> <td> </td> <td align="right">6,872</td> <td> </td> <td> </td> <td> </td> <td align="right">4,203</td> <td> </td> <td> </td> <td> </td> <td align="right">11,075</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Depreciation </div></td> <td> </td> <td> </td> <td align="right">8,624</td> <td> </td> <td> </td> <td> </td> <td align="right">7,437</td> <td> </td> <td> </td> <td> </td> <td align="right">16,061</td> <td> </td> </tr> <tr valign="bottom" style="line-height: 9pt"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>For the three months ended September 30, 2009</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Customer revenue </div></td> <td> </td> <td align="left">  $  </td> <td align="right">325,363</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">319,859</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">645,222</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Operating profit </div></td> <td> </td> <td> </td> <td align="right">19,544</td> <td> </td> <td> </td> <td> </td> <td align="right">11,626</td> <td> </td> <td> </td> <td> </td> <td align="right">31,170</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Capital expenditures </div></td> <td> </td> <td> </td> <td align="right">3,480</td> <td> </td> <td> </td> <td> </td> <td align="right">2,797</td> <td> </td> <td> </td> <td> </td> <td align="right">6,277</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Depreciation </div></td> <td> </td> <td> </td> <td align="right">6,383</td> <td> </td> <td> </td> <td> </td> <td align="right">4,605</td> <td> </td> <td> </td> <td> </td> <td align="right">10,988</td> <td> </td> </tr> <tr valign="bottom" style="line-height: 9pt"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>As of and for the nine months September 30, 2010</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Customer revenue </div></td> <td> </td> <td align="left">  $  </td> <td align="right">968,508</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">1,064,291</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">2,032,799</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Operating profit </div></td> <td> </td> <td> </td> <td align="right">67,096</td> <td> </td> <td> </td> <td> </td> <td align="right">72,723</td> <td> </td> <td> </td> <td> </td> <td align="right">139,819</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Capital expenditures </div></td> <td> </td> <td> </td> <td align="right">24,373</td> <td> </td> <td> </td> <td> </td> <td align="right">13,618</td> <td> </td> <td> </td> <td> </td> <td align="right">37,991</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Depreciation </div></td> <td> </td> <td> </td> <td align="right">19,877</td> <td> </td> <td> </td> <td> </td> <td align="right">18,991</td> <td> </td> <td> </td> <td> </td> <td align="right">38,868</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Property, plant and equipment, at cost </div></td> <td> </td> <td> </td> <td align="right">456,974</td> <td> </td> <td> </td> <td> </td> <td align="right">176,533</td> <td> </td> <td> </td> <td> </td> <td align="right">633,507</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Total assets </div></td> <td> </td> <td> </td> <td align="right">1,046,254</td> <td> </td> <td> </td> <td> </td> <td align="right">1,544,088</td> <td> </td> <td> </td> <td> </td> <td align="right">2,590,342</td> <td> </td> </tr> <tr valign="bottom" style="line-height: 9pt"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>As of and for the nine months ended September 30, 2009</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Customer revenue </div></td> <td> </td> <td align="left">  $  </td> <td align="right">1,043,500</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">949,869</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">1,993,369</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Operating profit </div></td> <td> </td> <td> </td> <td align="right">68,353</td> <td> </td> <td> </td> <td> </td> <td align="right">53,901</td> <td> </td> <td> </td> <td> </td> <td align="right">122,254</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Capital expenditures </div></td> <td> </td> <td> </td> <td align="right">18,746</td> <td> </td> <td> </td> <td> </td> <td align="right">9,668</td> <td> </td> <td> </td> <td> </td> <td align="right">28,414</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Depreciation </div></td> <td> </td> <td> </td> <td align="right">19,309</td> <td> </td> <td> </td> <td> </td> <td align="right">15,425</td> <td> </td> <td> </td> <td> </td> <td align="right">34,734</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Property, plant and equipment, at cost </div></td> <td> </td> <td> </td> <td align="right">439,004</td> <td> </td> <td> </td> <td> </td> <td align="right">166,232</td> <td> </td> <td> </td> <td> </td> <td align="right">605,236</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Total assets </div></td> <td> </td> <td> </td> <td align="right">1,139,171</td> <td> </td> <td> </td> <td> </td> <td align="right">1,384,890</td> <td> </td> <td> </td> <td> </td> <td align="right">2,524,061</td> <td> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 18pt">The following table presents information regarding the Company’s revenue by geographic region: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="87%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Three Months Ended</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Nine Months Ended</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Revenue summary by geography</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Diebold North America </div></td> <td> </td> <td align="left">  $  </td> <td align="right">349,673</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">325,363</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">968,508</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">1,043,500</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Diebold International: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:25px; text-indent:-15px">Latin America including Brazil </div></td> <td> </td> <td> </td> <td align="right">248,649</td> <td> </td> <td> </td> <td> </td> <td align="right">150,154</td> <td> </td> <td> </td> <td> </td> <td align="right">573,976</td> <td> </td> <td> </td> <td> </td> <td align="right">437,757</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:25px; text-indent:-15px">Asia Pacific </div></td> <td> </td> <td> </td> <td align="right">68,391</td> <td> </td> <td> </td> <td> </td> <td align="right">98,142</td> <td> </td> <td> </td> <td> </td> <td align="right">257,249</td> <td> </td> <td> </td> <td> </td> <td align="right">280,762</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:25px; text-indent:-15px">Europe, Middle East and Africa </div></td> <td> </td> <td> </td> <td align="right">81,907</td> <td> </td> <td> </td> <td> </td> <td align="right">71,563</td> <td> </td> <td> </td> <td> </td> <td align="right">233,066</td> <td> </td> <td> </td> <td> </td> <td align="right">231,350</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total Diebold International </div></td> <td> </td> <td> </td> <td align="right">398,947</td> <td> </td> <td> </td> <td> </td> <td align="right">319,859</td> <td> </td> <td> </td> <td> </td> <td align="right">1,064,291</td> <td> </td> <td> </td> <td> </td> <td align="right">949,869</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Total revenue </div></td> <td> </td> <td align="left">  $  </td> <td align="right">748,620</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">645,222</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">2,032,799</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">1,993,369</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">The following table presents information regarding the Company’s revenue by product and service solution: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="75%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%">   </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%">   </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%">   </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Three Months Ended</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6"><b>Nine Months Ended</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td nowrap="nowrap" align="left" style="border-bottom: 0px solid #000000"><b>Revenue summary by product and service solution</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Financial self-service: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Products </div></td> <td> </td> <td align="left">  $    </td> <td align="right">237,686</td> <td> </td> <td> </td> <td align="left">  $    </td> <td align="right">216,520</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">645,127</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">722,020</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Services </div></td> <td> </td> <td> </td> <td align="right">273,049</td> <td> </td> <td> </td> <td> </td> <td align="right">268,816</td> <td> </td> <td> </td> <td> </td> <td align="right">806,306</td> <td> </td> <td> </td> <td> </td> <td align="right">798,275</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:35px; text-indent:-15px">Total financial self-service </div></td> <td> </td> <td> </td> <td align="right">510,735</td> <td> </td> <td> </td> <td> </td> <td align="right">485,336</td> <td> </td> <td> </td> <td> </td> <td align="right">1,451,433</td> <td> </td> <td> </td> <td> </td> <td align="right">1,520,295</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Security: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Products </div></td> <td> </td> <td> </td> <td align="right">49,150</td> <td> </td> <td> </td> <td> </td> <td align="right">61,173</td> <td> </td> <td> </td> <td> </td> <td align="right">149,545</td> <td> </td> <td> </td> <td> </td> <td align="right">177,002</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Services </div></td> <td> </td> <td> </td> <td align="right">103,970</td> <td> </td> <td> </td> <td> </td> <td align="right">97,201</td> <td> </td> <td> </td> <td> </td> <td align="right">298,243</td> <td> </td> <td> </td> <td> </td> <td align="right">292,081</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:35px; text-indent:-15px">Total security </div></td> <td> </td> <td> </td> <td align="right">153,120</td> <td> </td> <td> </td> <td> </td> <td align="right">158,374</td> <td> </td> <td> </td> <td> </td> <td align="right">447,788</td> <td> </td> <td> </td> <td> </td> <td align="right">469,083</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Total financial self-service & security </div></td> <td> </td> <td> </td> <td align="right">663,855</td> <td> </td> <td> </td> <td> </td> <td align="right">643,710</td> <td> </td> <td> </td> <td> </td> <td align="right">1,899,221</td> <td> </td> <td> </td> <td> </td> <td align="right">1,989,378</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Election and lottery systems: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Products </div></td> <td> </td> <td> </td> <td align="right">84,760</td> <td> </td> <td> </td> <td> </td> <td align="right">1,512</td> <td> </td> <td> </td> <td> </td> <td align="right">133,553</td> <td> </td> <td> </td> <td> </td> <td align="right">3,991</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Services </div></td> <td> </td> <td> </td> <td align="right">5</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">25</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:35px; text-indent:-15px">Total election and lottery systems </div></td> <td> </td> <td> </td> <td align="right">84,765</td> <td> </td> <td> </td> <td> </td> <td align="right">1,512</td> <td> </td> <td> </td> <td> </td> <td align="right">133,578</td> <td> </td> <td> </td> <td> </td> <td align="right">3,991</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:30px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Total revenue </div></td> <td> </td> <td align="left">  $    </td> <td align="right">748,620</td> <td> </td> <td> </td> <td align="left">  $    </td> <td align="right">645,222</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">2,032,799</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">1,993,369</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> </div>

<div style="font-family: 'Times New Roman',Times,serif"> <div align="justify" style="font-size: 10pt; margin-top: 10pt"><b>NOTE 16: DISCONTINUED OPERATIONS</b> </div> <div align="justify" style="font-size: 10pt; margin-top: 5pt">During the third quarter of 2009, the Company sold its U.S. election systems business, primarily consisting of its subsidiary Premier Election Solutions, Inc. (PESI), for $12,147, including $5,000 of cash and contingent consideration with a fair value of $7,147, which represents 70 percent of any cash collected over a five-year period on the accounts receivable balance of the sold business as of August 31, 2009. The sale agreement contained indemnification clauses pursuant to which the Company agreed to indemnify the purchaser for any and all adverse consequences relating to certain existing liabilities. In addition, the sale agreement contained shared liability clauses pursuant to which the Company agreed to indemnify the purchaser for 70 percent of any adverse consequences to the purchaser arising out of certain defined potential litigation or obligations. As of September 30, 2010, there were no material adverse consequences related to these shared liability indemnifications. The Company’s maximum exposure under the shared liability indemnifications is $8,000. The carrying value of the indemnified and shared liabilities related to the PESI sale was $1,531 as of September 30, 2010. </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">During the fourth quarter of 2008, the Company decided to discontinue its enterprise security operations in the Europe, Middle East and Africa region. </div> <div align="justify" style="font-size: 10pt; margin-top: 10pt">Summarized financial information for discontinued operations is as follows: </div> <div align="left"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="80%">  <tr valign="bottom"> <td width="60%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="3%">   </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="3%">   </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="3%">   </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Three Months Ended</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Nine Months Ended</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>September 30,</b></td> </tr> <tr style="font-size: 9pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>2009</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total revenue </div></td> <td> </td> <td align="left">  $    </td> <td align="right">199</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">5,194</td> <td> </td> <td> </td> <td align="left">  $    </td> <td align="right">510</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">23,018</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Loss from discontinued operations </div></td> <td> </td> <td nowrap="nowrap" align="left">  $    </td> <td align="right">(167</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $  </td> <td align="right">(2,633</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $    </td> <td align="right">(2,634</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="left">  $  </td> <td align="right">(14,781</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Loss on sale of discontinued operations </div></td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(50,750</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">-</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(50,750</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Income tax benefit </div></td> <td> </td> <td> </td> <td align="right">2,210</td> <td> </td> <td> </td> <td> </td> <td align="right">21,742</td> <td> </td> <td> </td> <td> </td> <td align="right">3,024</td> <td> </td> <td> </td> <td> </td> <td align="right">25,251</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Income (loss) from discontinued operations, net of tax </div></td> <td> </td> <td align="left">  $    </td> <td align="right">2,043</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">(31,641</td> <td nowrap="nowrap">)</td> <td> </td> <td align="left">  $    </td> <td align="right">390</td> <td> </td> <td> </td> <td align="left">  $  </td> <td align="right">(40,280</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td nowrap="nowrap" colspan="3" align="right" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="justify" style="font-size: 10pt; margin-top: 8pt">During the third quarter of 2010, the Company finalized and filed its consolidated U.S. federal tax return and recorded an additional tax benefit of $2,147 included within income (loss) from discontinued operations, net of tax. </div> </div>

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