This policy applies to all LSI employees, temporary agency employees and contract employees

PURPOSE:

LSI prides itself on the high standards of excellence embodied by our operating principles. We expect our employees to personify these ideals in their dealing with persons both inside and outside the Company. The highest standards of business ethics, honesty, respect, fairness, and integrity are expected from all LSI employees.

The LSI Business Ethics policy was designed to make our employees aware of the responsibility we all share in promoting and protecting the Company’s best interests, and is based on the principle that an employee’s business decisions must be made in the best interest of LSI, its subsidiaries and divisions, and advance the interest of our shareholders.

This policy requires all personnel to conduct themselves to avoid any conflict with LSI’s best interest and to act in careful and unwavering compliance with the law, domestic and foreign. Not every instance of a violation of this policy can be anticipated; however, we have listed specific examples of conflicts with this standard. In general, employees should apply good judgment and common sense, together with a desire simply to do the right thing, in making business and personal decisions where no stated guideline exists. When in doubt about whether a particular matter violates the policy, seek guidance from your Manager or the Human Resources Department.

As a public company, LSI is committed to advancing the long-term interests of its shareholders and to protecting and improving the value of their investment by observing the highest standards of ethical and legal conduct in all business dealings.

POLICY:
Confidential Information
Your position within LSI may give you access to confidential information about our business, customers, suppliers and other organizations with which we do business. You should consider all information gained through your employment as confidential LSI information and handle all confidential information with care to avoid inadvertent or careless disclosure. Accessing or attempting to access confidential or personal information for non-business related purposes is strictly prohibited.

Phone, Faxes, E-Mail and Internet
Company equipment, including phone lines, faxes, e-mail, modems, hard drives, etc., are to be used only for business purposes. Employees are not to use unauthorized codes, passwords, or other means to gain access information belonging to others. Employees shall not disclose their codes or passwords to others.

Employees are expected to comply with all laws and LSI policies which may apply to the use of Company equipment, including, but not limited to illegal use of software, copyright laws, use of company equipment only for a company purpose, confidentiality, solicitation, moonlighting, and harassment. Employees are expressly forbidden from using Company equipment to play games, sell personal items, solicit, harass or discriminate, and view or download pornographic material.

The Company monitors its phone system, faxes, e-mail, network, and computers. Information stored in or on Company equipment is subject to inspection at any time without notice.

Employees are expected to treat employees, customers and suppliers alike with courtesy, dignity and respect in all communications. Employees should not use the e-mail system when a personal telephone call is more appropriate for maintaining cordial relationships with our vendors and customers.

Trade Secrets
LSI has invested in the development of systems, processes, products, knowledge and technology that give us a competitive edge. We call this information, knowledge and technology our "trade secrets." All employees have a responsibility to protect and maintain the confidentiality of LSI trade secrets.

Professional Integrity
Relationships with customers, manufacturers, suppliers, competitors, and employees are to be based on integrity, honesty, and respect. If you hire a service provider, you should take reasonable steps to ensure that the service provider has a reputation and record of integrity and ethical conduct and that the service provider acts in a manner that reflects the highest ethical standards. Under no condition will employees of LSI enter into arrangements with competitors affecting pricing or marketing policies.

Conflicts of Interest
You may not use your position with LSI or any of LSI’s resources, property or information for you, or your immediate family members' personal gain or benefit. In addition, you have a responsibility to avoid situations and relationships that involve actual or possible conflicts of interest. Situations or transactions that create the appearance or perception that you cannot carry out your duties and responsibilities with integrity and impartiality are to be avoided.

You are responsible for advancing LSI’s business interests when the opportunity to do so arises. You may not compete with LSI in any way during your employment with LSI. You may not take any opportunities or use any confidential information for your benefit, or for the benefit of your immediate family members, that you discover or obtain through your employment with LSI.

You may not carry on Company business with a firm in which you or a close relative have a substantial ownership or interest. You may not hold a substantial interest in, or participate in the management of, a firm in which the Company makes sales or from which it makes purchases.

You may not borrow money from customers or firms, other than recognized loan institutions, from which LSI buys services, materials, equipment, or supplies.

Employment by Other Companies
It is permissible for an employee to hold a second job, as long as it has nothing to do with the Company’s business. An employee may not moonlight or work on the side for a Company that engages in a line of business similar to or in direct competition with LSI's.

Insider Trading
Inside information is any non-public information that a reasonable investor is likely to consider important in making an investment decision. Common examples of inside information include:

• Projections of future earnings or losses
• News of a pending merger, acquisition or offer
• News of a sale of assets or the disposition of a subsidiary
• Changes in dividend policy, the declaration of a stock split, or the offering of additional securities
• Changes in management
• Significant new products or discoveries
• Impending bankruptcy or financial liquidity problems
• The gain or loss of a significant supplier or customer
• The possible awarding or cancellation of a significant contract to either LSI or to a supplier

It is illegal to buy or sell LSI stock or other securities because of material, nonpublic inside information. It is also illegal to communicate or "tip" inside information to others so that they may buy or sell stock or other securities.

Gifts and Entertainment
LSI employees or members of their families may not request, encourage or accept a gift or gratuity from a supplier, potential supplier, customer, or any person who you believe may seek to influence any business decision or transaction involving LSI. Examples of gifts or gratuities include the following:

• "free goods" (e.g., shirts, coffee mugs, alcohol)
• tickets to sporting or entertainment events
• kickbacks in the form of money or merchandise
• discontinued or no longer used
• supplier paid trips
• supplier paid golf outings
• liquor or meals
• personal services or favors

Any gift or gratuity received from a supplier must be returned with an explanation of this policy. Where return is impractical, any gift that is not returned becomes the property of LSI.

Relations with Suppliers
LSI bases its relationships with suppliers on lawful, efficient and fair business practices. The selection of suppliers is made based on objective criteria, including quality, price, delivery, adherence to schedules, product suitability, maintenance of adequate sources of supply, and LSI’s purchasing practices and procedures. Employees will treat LSI suppliers with respect, fairness and honesty.

Bribes, Kickbacks or Payoffs
The U.S. Foreign Corrupt Practices Act, other U.S. laws, and similar laws of other countries, prohibit you, on behalf of LSI, from directly or indirectly making, promising, authorizing or offering anything of value to a government official or employee, political party, or any candidate for political office.

LSI does not permit or condone bribes, kickbacks, or any other illegal, secret, or improper payments, transfers, or receipts. This prohibition applies to both the giving and the receiving of payments or gifts.

Duty to Shareholders
LSI will provide full, fair, accurate, timely and understandable disclosure in the reports and documents it files with the Securities and Exchange Commission, as well as in its other public communications. LSI will also conduct its operations in accordance with accepted principles of good corporate governance.

Financial Integrity
LSI requires honest and accurate recording and reporting of financial information in order to make responsible business decisions. All financial books, records and accounts must accurately reflect transactions and events and conform to generally accepted accounting principles and to LSI's system of internal controls. No LSI document or record may be falsified for any reason, and no undisclosed or unrecorded accounts of LSI's funds or assets may be established for any purpose. No false or fictitious entries shall be made in books, records, accounts, or in Company communications for any reason. No payment or transfer of funds or assets shall be made for any purpose other than described by the supporting documents, and specifically as authorized.

LSI Assets
LSI property is to be used only for LSI business and is not be used for any type of personal gain. You are responsible for maintaining LSI property under your control and should take reasonable steps to protect LSI property from theft, misuse, loss, damage, or sabotage.

LSI employees have no expectation of privacy as to the use of LSI communication tools, and LSI has the right to, and does monitor your communication tools, including their content, and your usage of such tools.

Media Statements
You may not make any media statement (written or verbal) on behalf of LSI to media, news publications, trade publications or any other source without prior approval from the CEO.

Antitrust
Antitrust laws protect free enterprise by ensuring vigorous competition. These laws prohibit activities that restrain trade. LSI is committed to doing its part to preserve free enterprise by requiring that all employees follow all applicable antitrust laws. The following are examples of activities that are to be avoided under antitrust laws:

• Agreements with competitors with respect to price, terms of sale, costs, profits, profit margins or the division or allocation of markets, territories, or customers;
• Exchanging any unpublished information concerning prices, terms of sale or any other competitive information with a customer;
• Knowingly inducing a supplier to give a lower price or better terms to LSI than to a competitor of LSI, unless either (1) it is based on actual differences in cost of manufacture, sale or distribution or (2) you believe another supplier will offer the same goods at a lower price and you express that belief to the supplier (without specifically identifying the other supplier or the amount it is likely to bid);
• Tie-in sales, where the supplier refuses to sell product A to LSI unless LSI also buys product B, are illegal.
• Agreements to boycott a third party. It is legal for LSI to decide that it will not do business with other companies, but you should never discuss with others LSI's intention to do or not do business with such companies.

Political Activities
LSI encourages you to participate in the political process outside of work and during non-work time. You have the right to make lawful contributions to political parties, candidates or political action committees; however, under no circumstances will LSI reimburse you for political activities. LSI will not reimburse employees for tickets for personal attendance at any political fundraising event, even if business is discussed at the event.

Except as required by law or allowed by LSI policy, employees may not use their work time or other employees' work time for political activities.

International Trade
Many countries regulate international trade restrictions, such as imports, exports and international financial transactions. All goods imported into the United States must pass through Customs where a duty must be paid, unless an exemption applies. Most other countries have similar requirements. LSI will follow all relevant international trade control regulations, including licensing, shipping documentation, duty requirements, import/export documentation, and reporting and record retention requirements of all countries in which it conducts business.

Whistleblower
LSI prohibits any employee from retaliating against anyone who in good faith raises or helps to resolve an ethics concern.

How to Raise an Ethics Concern
You may report ethics concerns or possible violations of LSI’s Business Ethics Policy or any other LSI policy by voicing your concerns to your immediate supervisor. If you believe your immediate supervisor is involved in misconduct, report the misconduct to the next level of management believed not to be involved or contact the LSI Corporate VP of Human Resources.

NO employee who in good faith reports a suspected violation will be subject to retaliation for having made the report.

Administration of the Policy
All allegations of improper or illegal behavior will be investigated promptly and thoroughly. The investigation will remain as confidential as practicable and those conducting the investigation will respect the privacy of all persons involved.

Violations of the Policy
Employees who violate this policy are subject to disciplinary action up to and including termination of employment. Disciplinary action will be taken not only against employees who authorize or participate directly in a violation of this policy, but also against:

• any employee who deliberately fails to report a violation of the policy;
• any employee who deliberately withholds relevant and material information concerning a violation of this policy.