| (Mark One) | ||
|
þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
| For the period ended April 4, 2009 | ||
| or | ||
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
| For the transition period from to |
| DELAWARE | 36-1115800 | |
| (State of Incorporation) | (I.R.S. Employer Identification No.) | |
|
1303 E. Algonquin Road
Schaumburg, Illinois |
60196 |
|
|
(Address of principal
executive offices) |
(Zip Code) |
|
Large accelerated
filer
þ
|
Accelerated filer o | |
|
Non-accelerated
filer
o
(Do not check if a smaller reporting company)
|
Smaller reporting company o |
|
Class
|
Number of Shares
|
|
| Common Stock; $3 Par Value | 2,292,406,133 |
8
Three Months Ended
April 4,
March 29,
(In millions, except per share
amounts)
2009
2008
$
5,371
$
7,448
3,875
5,303
1,496
2,145
869
1,183
847
1,054
229
177
(449
)
(269
)
(35
)
(2
)
(20
)
19
70
(5
)
15
12
(434
)
(257
)
(146
)
(67
)
(288
)
(190
)
60
—
(228
)
(190
)
3
4
$
(231
)
$
(194
)
$
(291
)
$
(194
)
60
—
$
(231
)
$
(194
)
$
(0.13
)
$
(0.09
)
0.03
—
$
(0.10
)
$
(0.09
)
$
(0.13
)
$
(0.09
)
0.03
—
$
(0.10
)
$
(0.09
)
2,280.5
2,257.0
2,280.5
2,257.0
$
0.05
$
0.05
1
Table of Contents
2
Table of Contents
Motorola, Inc. Shareholders
Accumulated Other Comprehensive Income (Loss)
Fair Value
Common
Adjustment
Foreign
Stock and
to Available
Currency
Retirement
Additional
for Sale
Translation
Benefits
Paid-in
Securities,
Adjustments,
Adjustments,
Other Items,
Retained
Noncontrolling
Comprehensive
(In millions, except share amounts)
Shares
Capital
Net of Tax
Net of Tax
Net of Tax
Net of Tax
Earnings
Interests
Earnings (Loss)
2,276.9
$
7,834
$
2
$
(133
)
$
(2,067
)
$
(7
)
$
3,878
$
88
(231
)
3
$
(228
)
7
7
(149
)
(149
)
16
16
16.0
68
54
3
3
2,292.9
$
7,956
$
9
$
(282
)
$
(2,051
)
$
(4
)
$
3,647
$
91
$
(351
)
3
Table of Contents
Three Months Ended
April 4,
March 29,
(In millions)
2009
2008
$
(231
)
$
(194
)
3
4
(228
)
(190
)
60
—
(288
)
(190
)
190
204
4
(1
)
76
78
20
(19
)
(67
)
—
(197
)
(278
)
(204
)
627
582
(46
)
217
(166
)
(1,355
)
(636
)
8
84
(1,014
)
(343
)
(15
)
(140
)
137
20
—
1
(71
)
(111
)
3
5
1,319
631
206
147
1,579
553
(31
)
(54
)
(129
)
(114
)
56
6
—
(138
)
(114
)
(114
)
—
(1
)
(218
)
(415
)
(146
)
146
201
(59
)
3,064
2,752
$
3,265
$
2,693
$
28
$
19
51
161
4
Table of Contents
April 4,
Three Months Ended
2009
$
19
(11
)
175
162
102
60
5
Table of Contents
Three Months Ended
April 4,
March 29,
2009
2008
$
158
$
74
71
83
—
20
$
229
$
177
Three Months Ended
April 4,
March 29,
2009
2008
$
(62
)
$
(78
)
27
76
$
(35
)
$
(2
)
$
67
$
—
8
—
6
1
(7
)
(18
)
(1
)
(4
)
—
24
(3
)
(8
)
$
70
$
(5
)
6
Table of Contents
Amounts attributable to Motorola, Inc.
common shareholders
Continuing Operations
Net Loss
April 4,
March 29,
April 4,
March 29,
Three Months Ended
2009
2008
2009
2008
$
(291
)
$
(194
)
$
(231
)
$
(194
)
2,280.5
2,257.0
2,280.5
2,257.0
$
(0.13
)
$
(0.09
)
$
(0.10
)
$
(0.09
)
$
(291
)
$
(194
)
$
(231
)
$
(194
)
2,280.5
2,257.0
2,280.5
2,257.0
2,280.5
2,257.0
2,280.5
2,257.0
$
(0.13
)
$
(0.09
)
$
(0.10
)
$
(0.09
)
Recorded Value
Temporary Unrealized
April 4, 2009
Current
Non-current
Gains
Losses
$
993
$
—
$
—
$
—
1,438
208
22
(75
)
89
23
—
(26
)
67
26
—
(14
)
$
2,587
$
257
$
22
$
(115
)
7
Table of Contents
Recorded Value
Temporary Unrealized
December 31,
2008
Current
Non-current
Gains
Losses
$
1,108
$
—
$
—
$
—
20
—
—
—
752
—
—
—
1,616
366
25
(88
)
113
59
—
(24
)
81
41
—
(14
)
$
3,690
$
466
$
25
$
(126
)
Table of Contents
Recorded Value
Less
Short-term
Unrealized
Unrealized
Cost
April 4, 2009
Investments
Investments
Gains
Losses
Basis
$
19
$
—
$
—
$
—
$
19
—
27
1
—
26
—
12
—
(1
)
13
—
1
—
—
1
—
3
—
—
3
—
118
17
(2
)
103
19
161
18
(3
)
165
—
274
—
—
274
—
63
—
—
63
$
19
$
498
$
18
$
(3
)
$
502
Recorded Value
Less
Short-term
Unrealized
Unrealized
Cost
December 31,
2008
Investments
Investments
Gains
Losses
Basis
$
225
$
—
$
—
$
—
$
225
—
28
1
—
27
—
11
—
—
11
—
1
—
—
1
—
4
—
—
4
—
117
5
(2
)
114
225
161
6
(2
)
382
—
296
—
—
296
—
60
—
—
60
$
225
$
517
$
6
$
(2
)
$
738
April 4,
December 31,
2009
2008
$
3,863
$
3,675
(174
)
(182
)
$
3,689
$
3,493
9
Table of Contents
April 4,
December 31,
2009
2008
$
1,384
$
1,710
1,497
1,709
2,881
3,419
(810
)
(760
)
$
2,071
$
2,659
April 4,
December 31,
2009
2008
$
995
$
1,094
900
861
393
378
193
278
438
529
$
2,919
$
3,140
April 4,
December 31,
2009
2008
$
140
$
148
1,850
1,905
5,404
5,687
7,394
7,740
(5,072
)
(5,298
)
$
2,322
$
2,442
April 4,
December 31,
2009
2008
$
798
$
869
266
289
157
136
94
117
54
52
339
353
$
1,708
$
1,816
10
Table of Contents
April 4,
December 31,
2009
2008
$
1,606
$
1,533
673
496
612
703
467
545
453
599
256
318
255
285
2,406
2,861
$
6,728
$
7,340
April 4,
December 31,
2009
2008
$
2,119
$
2,202
293
316
284
312
264
261
503
471
$
3,463
$
3,562
11
Table of Contents
Notional Amount
April 4,
December 31,
Net Buy (Sell) by
Currency
2009
2008
$
(566
)
$
(481
)
(488
)
(445
)
(407
)
(356
)
255
122
128
542
12
Table of Contents
Fair Values of Derivative Instruments
Assets
Liabilities
Balance
Balance
Fair
Sheet
Fair
Sheet
April 4, 2009
Value
Location
Value
Location
$
5
Other assets
$
10
Other liabilities
34
Other assets
26
Other liabilities
1
Other assets
6
Other liabilities
35
32
$
40
$
42
Gain
Statement of
Three Months Ended April 4,
2009
(Loss)
Operations Location
Foreign exchange contracts
$
—
Foreign currency gain (loss
)
(5
)
Other income (expense
)
(31
)
Other income (expense
)
$
(36
)
13
Table of Contents
Foreign
Exchange
Three Months Ended April 4,
2009
Contracts
Location
$
(5
)
(6
)
Cost of sales/Sales
—
Other income (expense
)
14
Table of Contents
April 4, 2009
March 29, 2008
Regular
Officers’
Non
Regular
Officers’
Non
Three Months Ended
Pension
and MSPP
U.S.
Pension
and MSPP
U.S.
$
4
$
—
$
6
$
26
$
1
$
13
85
2
16
81
2
32
(95
)
—
(14
)
(98
)
(1
)
(29
)
20
—
1
13
1
—
—
—
—
(8
)
—
—
—
2
—
—
3
—
$
14
$
4
$
9
$
14
$
6
$
16
Three Months Ended
April 4,
March 29,
2009
2008
$
1
$
3
7
6
(4
)
(5
)
2
1
(1
)
(1
)
$
5
$
4
15
Table of Contents
Three Months Ended
April 4,
March 29,
2009
2008
$
9
$
8
41
47
26
23
76
78
24
24
$
52
$
54
$
(0.02
)
$
(0.02
)
$
(0.02
)
$
(0.02
)
16
Table of Contents
April 4, 2009
Level 1
Level 2
Level 3
Total
$
—
$
993
$
—
$
993
—
1,545
101
1,646
—
112
—
112
—
85
8
93
—
27
—
27
—
12
—
12
—
1
—
1
—
3
—
3
118
—
—
118
—
40
—
40
—
42
—
42
Three Months Ended
April 4,
March 29,
2009
2008
$
134
$
35
1
10
(24
)
—
(1
)
(4
)
(1
)
—
—
(2
)
$
109
$
39
17
Table of Contents
April 4,
December 31,
2009
2008
$
205
$
169
(4
)
(7
)
201
162
(147
)
(110
)
$
54
$
52
18
Table of Contents
19
Table of Contents
•
The
Mobile Devices
segment designs, manufactures, sells
and services wireless handsets with integrated software and
accessory products, and licenses intellectual property.
•
The
Home and Networks Mobility
segment designs,
manufactures, sells, installs and services: (i) digital
video, Internet Protocol video and broadcast network interactive
set-tops (“digital entertainment devices”), end-to-end
video delivery systems, broadband access infrastructure
platforms, and associated data and voice customer premise
equipment to cable television and telecom service providers
(collectively, referred to as the “home business”),
and (ii) wireless access systems, including cellular
infrastructure systems and wireless broadband systems, to
wireless service providers (collectively, referred to as the
“network business”).
•
The
Enterprise Mobility Solutions
segment designs,
manufactures, sells, installs and services analog and digital
two-way radio, voice and data communications products and
systems for private networks, wireless broadband systems and
end-to-end enterprise mobility solutions to a wide range of
enterprise markets, including government and public safety
agencies (which, together with all sales to distributors of
two-way communication products, are referred to as the
“government and public safety market”), as well as
retail, energy and utilities, transportation, manufacturing,
healthcare and other commercial customers (which, collectively,
are referred to as the “commercial enterprise market”).
Operating Earnings
Net Sales
(Loss)
April 4,
March 29,
April 4,
March 29,
Three Months Ended
2009
2008
2009
2008
$
1,801
$
3,299
$
(509
)
$
(418
)
1,991
2,383
115
153
1,599
1,806
156
250
5,391
7,488
(238
)
(15
)
(20
)
(40
)
(211
)
(254
)
$
5,371
$
7,448
(449
)
(269
)
15
12
$
(434
)
$
(257
)
Three Months Ended
April 4,
March 29,
2009
2008
$
71
$
83
61
69
54
73
25
9
—
20
$
211
$
254
(1)
Primarily comprised of: (i) compensation expense related to
the Company’s employee stock options, stock appreciation
rights and employee stock purchase plans, and
(ii) compensation expenses related to the restricted stock
and restricted stock units granted to the corporate employees.
(2)
Primarily comprised of: (i) general corporate-related
expenses, (ii) various corporate programs, representing
developmental businesses and research and development projects,
which are not included in any reporting segment, and
(iii) the Company’s wholly-owned finance subsidiary.
20
Table of Contents
Three Months Ended
April 4, 2009
$
128
21
30
179
25
$
204
Accruals at
Accruals at
January 1,
Additional
Amount
April 4,
2009
Charges
Adjustments(1)
Used
2009
$
80
$
4
$
(5
)
$
(27
)
$
52
170
204
(20
)
(148
)
206
$
250
$
208
$
(25
)
$
(175
)
$
258
(1)
Includes translation adjustments.
21
Table of Contents
Three Months Ended
March 29, 2008
$
71
20
9
100
9
$
109
Accruals at
Accruals at
January 1,
Additional
Amount
March 29,
2009
Charges
Adjustments(1)
Used
2008
$
42
$
5
$
2
$
(5
)
$
44
193
113
(1
)
(74
)
231
$
235
$
118
$
1
$
(79
)
$
275
(1)
Includes translation adjustments.
22
Table of Contents
April 4, 2009
December 31, 2008
Gross
Gross
Carrying
Accumulated
Carrying
Accumulated
Amount
Amortization
Amount
Amortization
$
1,126
$
673
$
1,127
$
633
292
139
292
125
277
116
277
104
129
119
129
118
150
129
150
126
$
1,974
$
1,176
$
1,975
$
1,106
April 4, 2009
December 31, 2008
Gross
Gross
Carrying
Accumulated
Carrying
Accumulated
Segment
Amount
Amortization
Amount
Amortization
$
44
$
44
$
45
$
45
722
537
722
522
1,208
595
1,208
539
$
1,974
$
1,176
$
1,975
$
1,106
23
Table of Contents
January 1,
April 4,
Segment
2009
Adjustments(1)
Dispositions
2009
$
1,409
$
(4
)
$
—
$
1,405
1,428
—
(11
)
1,417
$
2,837
$
(4
)
$
(11
)
$
2,822
(1)
Includes translation adjustments.
24
Table of Contents
•
The
Mobile Devices
segment designs, manufactures, sells
and services wireless handsets with integrated software and
accessory products, and licenses intellectual property. In the
first quarter of 2009, the segment’s net sales were
$1.8 billion, representing 34% of the Company’s
consolidated net
sales.
*
•
The
Home and Networks Mobility
segment designs,
manufactures, sells, installs and services: (i) digital
video, Internet Protocol video and broadcast network interactive
set-tops (“digital entertainment devices”), end-to-end
video delivery systems, broadband access infrastructure
platforms, and associated data and voice customer premise
equipment to cable television and telecom service providers
(collectively, referred to as the “home business”),
and (ii) wireless access systems, including cellular
infrastructure systems and wireless broadband systems, to
wireless service providers (collectively, referred to as the
“network business”). In the first quarter of 2009, the
segment’s net sales were $2.0 billion, representing
37% of the Company’s consolidated net
sales.
*
•
The
Enterprise Mobility Solutions
segment designs,
manufactures, sells, installs and services analog and digital
two-way radio, voice and data communications products and
systems for private networks, wireless broadband systems and
end-to-end enterprise mobility solutions to a wide range of
enterprise markets, including government and public safety
agencies (which, together with all sales to distributors of
two-way communication products, are referred to as the
“government and public safety market”), as well as
retail, energy and utilities, transportation, manufacturing,
healthcare and other commercial customers (which, collectively,
are referred to as the “commercial enterprise
market”). In the first quarter of 2009, the segment’s
net sales were $1.6 billion, representing 30% of the
Company’s consolidated net
sales.
*
•
Net Sales were $5.4 Billion:
Our net sales
were $5.4 billion in the first quarter of 2009, down 28%
compared to net sales of $7.4 billion in the first quarter
of 2008. Compared to the year-ago quarter, net sales decreased
45% in the Mobile Devices segment, decreased 16% in the Home and
Networks Mobility segment and decreased 11% in the Enterprise
Mobility Solutions segment.
•
Operating Loss of $449 Million:
We incurred an
operating loss of $449 million in the first quarter of
2009, compared to an operating loss of $269 million in the
first quarter of 2008. Operating margin was (8.4)% of net sales
in the first quarter of 2009, compared to (3.6)% of net sales in
the first quarter of 2008.
•
Loss From Continuing Operations of $291 Million, or $0.13 per
Share:
We incurred a net loss from continuing
operations of $291 million, or $0.13 per diluted
common share, in the first quarter of 2009, compared to a net
loss from continuing operations of $194 million, or $0.09
per diluted common share, in the first quarter of 2008.
•
First-Quarter Global Handset Market Share Estimated at 6.0%,
based on Handset Shipments of 14.7 Million
Units:
We estimate our share of the global
handset market in the first quarter of 2009 was approximately
6.0%, a decrease of approximately 3 percentage points
versus the first quarter of 2008. We shipped 14.7 million
handsets in the first quarter of 2009, a 46% decrease compared
to shipments of 27.4 million handsets in the first quarter
of 2008.
25
Table of Contents
•
Digital Entertainment Device Shipments were
4.3 Million:
We shipped 4.3 million
digital entertainment devices in the first quarter of 2009, an
increase of 2% compared to shipments of 4.2 million devices
in the first quarter of 2008.
•
Operating Cash Usage of $1.0 Billion:
We used
$1.0 billion of net cash for operating activities in the
first quarter of 2009, compared to using $343 million of
net cash for operating activities in the first quarter of 2008.
The increase in net cash used for operating activities was
primarily driven by: (i) a reduction in the volume of
accounts receivable sold to third parties, and (ii) an
increase in payments for employee severance and exit costs
related to the Company’s reorganization of business plans.
•
In Mobile Devices:
Net sales were
$1.8 billion in the first quarter of 2009, a decrease of
45% compared to net sales of $3.3 billion in the first
quarter of 2008. The decrease in net sales was primarily driven
by a 46% decrease in unit shipments, partially offset by a 2%
increase in average selling price (“ASP”). On a
geographic basis, net sales decreased substantially in all
regions. On a product technology basis, net sales decreased
substantially for GSM, CDMA and 3G technologies, partially
offset by an increase in sales of iDEN technologies.
•
In Home and Networks Mobility:
Net sales were
$2.0 billion in the first quarter of 2009, a decrease of
16% compared to net sales of $2.4 billion in the first
quarter of 2008. On a geographic basis, net sales decreased in
North America, the Europe, Middle East and Africa region and
Latin America and increased in Asia. The decrease in net sales
reflects a 21% decrease in net sales in the networks business
and a 12% decrease in net sales in the home business.
•
In Enterprise Mobility Solutions:
Net sales
were $1.6 billion in the first quarter of 2009, a decrease
of 11% compared to net sales of $1.8 billion in the first
quarter of 2008. On a geographic basis, net sales decreased in
all regions. The decrease in net sales was driven by a
double-digit percentage decline in net sales to the commercial
enterprise market and a single-digit percentage decline in net
sales to the government and public safety market.
26
Table of Contents
27
Table of Contents
Three Months Ended
April 4,
% of
March 29,
% of
(Dollars in millions, except
per share amounts)
2009
Sales
2008
Sales
$
5,371
$
7,448
3,875
72.1
%
5,303
71.2
%
1,496
27.9
%
2,145
28.8
%
869
16.2
%
1,183
15.9
%
847
15.8
%
1,054
14.2
%
229
4.3
%
177
2.3
%
(449
)
(8.4
)%
(269
)
(3.6
)%
(35
)
(0.6
)%
(2
)
(0.0
)%
(20
)
(0.4
)%
19
0.2
%
70
1.3
%
(5
)
(0.1
)%
15
0.3
%
12
0.1
%
(434
)
(8.1
)%
(257
)
(3.5
)%
(146
)
(2.7
)%
(67
)
(0.9
)%
(288
)
(5.4
)%
(190
)
(2.6
)%
3
0.0
%
4
0.0
%
(291
)
(5.4
)%
(194
)
(2.6
)%
60
1.1
%
—
—
%
$
(231
)
(4.3
)%
$
(194
)
(2.6
)%
$
(0.13
)
$
(0.09
)
0.03
—
$
(0.10
)
$
(0.09
)
*
Amounts attributable to Motorola, Inc. common shareholders.
28
Table of Contents
29
Table of Contents
30
Table of Contents
April 4,
Three Months Ended
2009
$
128
21
30
179
25
$
204
Accruals at
Accruals at
January 1,
Additional
Amount
April 4,
2009
Charges
Adjustments (1)
Used
2009
$
80
$
4
$
(5
)
$
(27
)
$
52
170
204
(20
)
(148
)
206
$
250
$
208
$
(25
)
$
(175
)
$
258
(1)
Includes translation adjustments.
31
Table of Contents
March 29,
Three Months Ended
2008
$
71
20
9
100
9
$
109
Accruals at
Accruals at
January 1,
Additional
Amount
March 29,
2008
Charges
Adjustments(1)
Used
2008
$
42
$
5
$
2
$
(5
)
$
44
193
113
(1
)
(74
)
231
$
235
$
118
$
1
$
(79
)
$
275
(1)
Includes translation adjustments.
32
Table of Contents
33
Table of Contents
34
Table of Contents
35
Table of Contents
36
Table of Contents
Name of
Long-Term
Commercial
Rating Agency
Debt Rating
Paper Rating
Date and Recent Actions Taken
BBB-
F-3
February 3, 2009,
downgraded
long-term debt to BBB- (negative outlook) from BBB (negative
outlook) and downgraded short-term debt to F-3 (negative
outlook) from F-2 (negative outlook).
Baa3
P-3
February 3, 2009,
downgraded
long-term debt to Baa3 (negative outlook) from Baa2 (review for
downgrade) and downgraded short-term debt to P-3 (negative
outlook) from P-2 (review for downgrade).
BB+
—
December 5, 2008,
downgraded
long-term debt to BB+ (stable outlook) from BBB (credit watch
negative) and withdrew the rating on commercial paper from A-2
(credit watch negative).
37
Table of Contents
38
Table of Contents
39
Table of Contents
Three Months Ended
April 4,
March 29,
(Dollars in millions)
2009
2008
% Change
$
1,801
$
3,299
(45
)%
(509
)
(418
)
22
%
40
Table of Contents
Three Months Ended
April 4,
March 29,
(Dollars in millions)
2009
2008
% Change
$
1,991
$
2,383
(16
)%
115
153
(25
)%
Three Months Ended
April 4,
March 29,
(Dollars in millions)
2009
2008
% Change
$
1,599
$
1,806
(11
%)
156
250
(38
%)
41
Table of Contents
42
Table of Contents
43
Table of Contents
Notional Amount
April 4,
December 31,
Net Buy (Sell) by
Currency
2009
2008
(566
)
$
(481
)
(488
)
(445
)
(407
)
(356
)
255
122
128
542
44
Table of Contents
45
Table of Contents
46
Table of Contents
(d) Maximum Number
(c) Total Number of
(or Approximate Dollar
Shares Purchased
Value) of Shares that
as Part of Publicly
May Yet be Purchased
(a) Total Number
(b) Average Price
Announced Plans or
Under the Plans or
Period
of Shares Purchased
Paid per Share
Programs(1)
Programs(1)
0
0
$
3,629,062,576
0
0
$
3,629,062,576
0
0
$
3,629,062,576
0
0
(1)
Through actions taken on July 24, 2006 and March 21,
2007, the Board of Directors has authorized the Company to
repurchase an aggregate amount of up to $7.5 billion of its
outstanding shares of common stock over a period ending on
June 30, 2009. The timing and amount of future repurchases,
if any, will be based on market and other conditions.
For
Against
Abstain
1,838,090,435
113,962,392
6,348,183
1,841,708,950
109,417,944
7,274,116
1,487,447,976
463,118,694
7,834,340
1,845,526,905
106,488,470
6,385,635
1,422,798,214
527,298,565
8,304,231
1,805,296,164
145,468,134
7,636,712
1,714,325,446
174,708,846
69,366,718
1,404,564,695
545,317,198
8,519,117
1,776,518,258
173,388,920
8,494,232
1,424,645,430
525,484,556
8,271,024
1,842,410,375
107,878,971
8,111,664
1,780,062,191
170,454,544
7,884,275
1,774,306,928
175,926,787
8,167,295
47
Table of Contents
48
Table of Contents
Exhibit
10
.1
2009 Motorola Incentive Plan (incorporated by reference to
Exhibit 10.1 to Motorola’s Report on
Form 8-K
filed on March 23, 2009 (File
No. 1-7221)).
10
.2
2009 Performance Measures under the 2009 Motorola Incentive Plan
(incorporated by reference to Exhibit 10.2 to
Motorola’s Report on
Form 8-K
filed on March 23, 2009 (File
No. 1-7221)).
10
.3
Motorola Long Range Incentive Plan (LRIP) of 2009 (incorporated
by reference to Exhibit 10.3 to Motorola’s Report on
Form 8-K
filed on March 23, 2009 (File
No. 1-7221).
10
.4
2009 Performance Measures under the Motorola Long Range
Incentive Plan (LRIP) of 2009 (incorporated by reference to
Exhibit 10.4 to Motorola’s Report on
Form 8-K
filed on March 23, 2009 (File
No. 1-7221)).
*10
.5
Motorola Omnibus Incentive Plan of 2006, as amended through
May 4, 2009.
*10
.6
Motorola Omnibus Incentive Plan of 2003, as amended through
May 4, 2009.
*10
.7
Motorola Omnibus Incentive Plan of 2002, as amended through
May 4, 2009.
*10
.8
Motorola Omnibus Incentive Plan of 2000, as amended through
May 4, 2009.
*10
.9
Motorola Amended and Restated Incentive Plan of 1998, as amended
through May 4, 2009.
*10
.10
Motorola Compensation/Acquisition Plan of 2000, as amended
through May 4, 2009.
*10
.11
Aircraft Time Sharing Agreement dated May 4, 2009, by and
between Motorola, Inc. and Gregory Q. Brown.
*10
.12
Aircraft Time Sharing Agreement dated May 4, 2009, by and
between Motorola, Inc. and Sanjay K. Jha.
*10
.13
Form of Motorola, Inc. Award Document-Terms and Conditions
Related to Employee Nonqualified Stock Options for Gregory Q.
Brown, relating to the Motorola Omnibus Incentive Plan of 2006
for a grant on or after May 7, 2009.
*10
.14
Form of Stock Option Consideration Agreement for Gregory Q.
Brown for grants on or after May 7, 2009.
*10
.15
Form of Motorola, Inc. Restricted Stock Unit Award Agreement for
Gregory Q. Brown relating to the Motorola Omnibus Incentive Plan
of 2006, for a grant on or after May 7, 2009.
*31
.1
Certification of Gregory Q. Brown pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.
*31
.2
Certification of Dr. Sanjay K. Jha pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
*31
.3
Certification of Edward J. Fitzpatrick pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
*32
.1
Certification of Gregory Q. Brown pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.
*32
.2
Certification of Dr. Sanjay K. Jha pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
*32
.3
Certification of Edward J. Fitzpatrick pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
*
filed herewith
49
Table of Contents
By:
50
Table of Contents
10
.1
2009 Motorola Incentive Plan (incorporated by reference to
Exhibit 10.1 to Motorola’s Report on Form 8-K filed on
March 23, 2009 (File No. 1-7221)).
10
.2
2009 Performance Measures under the 2009 Motorola Incentive Plan
(incorporated by reference to Exhibit 10.2 to Motorola’s
Report on Form 8-K filed on March 23, 2009 (File No. 1-7221)).
10
.3
Motorola Long Range Incentive Plan (LRIP) of 2009 (incorporated
by reference to Exhibit 10.3 to Motorola’s Report on Form
8-K filed on March 23, 2009 (File No. 1-7221).
10
.4
2009 Performance Measures under the Motorola Long Range
Incentive Plan (LRIP) of 2009 (incorporated by reference to
Exhibit 10.4 to Motorola’s Report on Form 8-K filed on
March 23, 2009 (File No. 1-7221)).
*10
.5
Motorola Omnibus Incentive Plan of 2006, as amended through May
4, 2009.
*10
.6
Motorola Omnibus Incentive Plan of 2003, as amended through May
4, 2009.
*10
.7
Motorola Omnibus Incentive Plan of 2002, as amended through May
4, 2009.
*10
.8
Motorola Omnibus Incentive Plan of 2000, as amended through May
4, 2009.
*10
.9
Motorola Amended and Restated Incentive Plan of 1998, as amended
through May 4, 2009.
*10
.10
Motorola Compensation/Acquisition Plan of 2000, as amended
through May 4, 2009.
*10
.11
Aircraft Time Sharing Agreement dated May 4, 2009, by and
between Motorola, Inc. and Gregory Q. Brown.
*10
.12
Aircraft Time Sharing Agreement dated May 4, 2009, by and
between Motorola, Inc. and Sanjay K. Jha.
*10
.13
Form of Motorola, Inc. Award Document-Terms and Conditions
Related to Employee Nonqualified Stock Options for Gregory Q.
Brown, relating to the Motorola Omnibus Incentive Plan of 2006
for a grant on or after May 7, 2009.
*10
.14
Form of Stock Option Consideration Agreement for Gregory Q.
Brown for grants on or after May 7, 2009.
*10
.15
Form of Motorola, Inc. Restricted Stock Unit Award Agreement for
Gregory Q. Brown relating to the Motorola Omnibus Incentive Plan
of 2006, for a grant on or after May 7, 2009.
*31
.1
Certification of Gregory Q. Brown pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.
*31
.2
Certification of Dr. Sanjay K. Jha pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
*31
.3
Certification of Edward J. Fitzpatrick pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
*32
.1
Certification of Gregory Q. Brown pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.
*32
.2
Certification of Dr. Sanjay K. Jha pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
*32
.3
Certification of Edward J. Fitzpatrick pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
*
filed herewith
51
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
2
3
4
5
6
7
8
2
3
4
5
6
7
2
3
4
5
6
7
| 1. | NAME AND PURPOSE |
| 2. | Administration |
| 3. | SHARES AVAILABLE UNDER THE PLAN |
| 4. | TYPES OF BENEFITS |
| 5. | STOCK OPTIONS |
2
| 6. | STOCK APPRECIATION RIGHTS |
| 7. | CHANGE IN CONTROL |
3
| 8 | ADJUSTMENT PROVISIONS |
| 9. | NONTRANSFERABILITY |
4
| 10. | TAXES |
| 11. | DURATION, AMENDMENT AND TERMINATION |
| 12. | FAIR MARKET VALUE |
| 13. | OTHER PROVISIONS |
5
| 14. | GOVERNING LAW |
6
1
2
3
4
5
6
| (a) | Fuel, oil, lubricants and other additives; | ||
| (b) | Travel expenses of the crew, including fuel, lodging, and ground transportation; | ||
| (c) | Hangar and tie-down costs away from the aircraft’s base of operation; | ||
| (d) | Insurance obtained for the specific flight; | ||
| (e) | Landing fees, airport taxes, and similar assessments; | ||
| (f) | Customs, foreign permit, and similar fees directly related to the flight, if applicable; | ||
| (g) | In-flight food and beverages; | ||
| (h) | Passenger ground transportation; | ||
| (i) | Flight planning and weather contract services; and | ||
| (j) | An additional charge equal to 100 percent of the expenses listed in Section 2.1(a). |
-2-
| (a) | maintain the Aircraft in good operating condition; | ||
| (b) | keep the Aircraft duly certified as airworthy at all times under the regulations of the FAA; | ||
| (c) | maintain the Aircraft in accordance with the standards prescribed by applicable law as the same may be in effect from time to time; and | ||
| (d) | maintain all records, logs and other documents required to be maintained with respect to the Aircraft. |
-3-
| (a) | Owner has title to the Aircraft and has all necessary authority to enter into this Agreement for the lease of the Aircraft to Lessee; and | ||
| (b) | Owner has not entered into this Agreement for the purpose of engaging in the sale of air transportation services for compensation or hire in contravention of the rules and regulations of the FAA. |
| (a) | Lessee has all necessary authority to enter into this Agreement for the lease of the Aircraft from Owner; and | ||
| (b) | Lessee has not entered into this Agreement for the purpose of engaging in the sale of air transportation services or for compensation or hire in contravention of the rules and regulations of the FAA. |
| (a) | Lessee shall be named as an additional insured; | ||
| (b) | Such insurance shall be primary without any right of contribution from any insurance carried by the Lessee; | ||
| (c) | The underwriter of such insurance shall waive any right of subrogation with respect to potential claims against Lessee. |
-4-
-5-
| MOTOROLA, INC. | LESSEE | |||||||||
|
|
||||||||||
|
|
||||||||||
| /s/ Greg A. Lee | /s/ Gregory Q. Brown | |||||||||
| Name: | Greg A. Lee | Name: | Gregory Q. Brown | |||||||
|
Title:
|
Senior Vice President,
Human Resources |
|||||||||
-6-
|
Aircraft
|
||
|
|
||
|
Dassault Falconjet 50EX
|
||
|
|
||
|
Gulfstream G450
|
||
|
|
||
|
Gulfstream G450
|
||
|
|
||
|
Gulfstream G550
|
| (a) | Fuel, oil, lubricants and other additives; | ||
| (b) | Travel expenses of the crew, including fuel, lodging, and ground transportation; | ||
| (c) | Hangar and tie-down costs away from the aircraft’s base of operation; | ||
| (d) | Insurance obtained for the specific flight; | ||
| (e) | Landing fees, airport taxes, and similar assessments; | ||
| (f) | Customs, foreign permit, and similar fees directly related to the flight, if applicable; | ||
| (g) | In-flight food and beverages; | ||
| (h) | Passenger ground transportation; | ||
| (i) | Flight planning and weather contract services; and | ||
| (j) | An additional charge equal to 100 percent of the expenses listed in Section 2.1(a). |
-2-
| (a) | maintain the Aircraft in good operating condition; | ||
| (b) | keep the Aircraft duly certified as airworthy at all times under the regulations of the FAA; | ||
| (c) | maintain the Aircraft in accordance with the standards prescribed by applicable law as the same may be in effect from time to time; and | ||
| (d) | maintain all records, logs and other documents required to be maintained with respect to the Aircraft. |
-3-
| (a) | Owner has title to the Aircraft and has all necessary authority to enter into this Agreement for the lease of the Aircraft to Lessee; and | ||
| (b) | Owner has not entered into this Agreement for the purpose of engaging in the sale of air transportation services for compensation or hire in contravention of the rules and regulations of the FAA. |
| (a) | Lessee has all necessary authority to enter into this Agreement for the lease of the Aircraft from Owner; and | ||
| (b) | Lessee has not entered into this Agreement for the purpose of engaging in the sale of air transportation services or for compensation or hire in contravention of the rules and regulations of the FAA. |
| (a) | Lessee shall be named as an additional insured; | ||
| (b) | Such insurance shall be primary without any right of contribution from any insurance carried by the Lessee; | ||
| (c) | The underwriter of such insurance shall waive any right of subrogation with respect to potential claims against Lessee. |
-4-
-5-
| MOTOROLA, INC. | LESSEE | |||||||||
|
|
||||||||||
|
|
||||||||||
| /s/Greg A. Lee | /s/ Sanjay K. Jha | |||||||||
|
Name:
|
Greg A. Lee | Name: Sanjay K. Jha | ||||||||
|
Title:
|
Senior Vice President,
Human Resources |
|||||||||
-6-
|
Aircraft
|
||
|
|
||
|
Dassault Falconjet 50EX
|
||
|
|
||
|
Gulfstream G450
|
||
|
|
||
|
Gulfstream G450
|
||
|
|
||
|
Gulfstream G550
|
|
|
Exhibit 10.13 | |
|
|
Greg Brown 5/09 | |
|
|
2006 Plan |
|
|
||||||||||
|
Recipient:
|
Date of Expiration: | |||||||||
|
|
||||||||||
|
|
||||||||||
|
|
||||||||||
|
Commerce ID#:
|
Number of Options: | |||||||||
|
|
||||||||||
|
|
||||||||||
|
|
||||||||||
|
Date of Grant:
|
Exercise Price: | |||||||||
|
|
||||||||||
|
|
||||||||||
|
|
| Percentage | Date | |
|
33.3%
|
May 7, 2010 | |
|
33.3%
|
May 7, 2011 | |
|
33.4%
|
May 7, 2012 |
-1-
-2-
-3-
-4-
-5-
-6-
| 1. | I acknowledge that my agreement to the following restrictive covenants are a condition of the grant of the Covered Options: |
| (a) | I agree that during the course of my employment and thereafter, I will not use or disclose, except on behalf of the Company and pursuant to its directions, any Company Confidential Information. Confidential Information means information concerning the Company and its business that is not generally known outside the Company. Confidential Information includes: (i) trade secrets; (ii) intellectual property; (iii) the Company’s methods of operation and Company processes; (iv) information regarding the Company’s present and/or future products, developments, processes and systems, including invention disclosures and patent applications; (v) information on customers or potential customers, including customer’s names, sales records, prices, and other terms of sales and Company cost information; (vi) Company personnel data; (vii) Company business plans, marketing plans, financial data and projections; and (viii) information received in confidence by the Company from third parties. Information regarding products or technological innovations in development, in test marketing or being marketed or promoted in a discrete geographic region, which information the Company or one of its affiliates is considering for broader use, shall not be deemed generally known until such broader use is actually commercially implemented. | ||
| (b) | I agree that during my employment and for a period of two years following my termination of employment for any reason, I will not hire, recruit, solicit or induce, or cause, allow, permit or aid others to hire, recruit, solicit or induce, or to communicate in support of those activities, any employee of the Company who possesses Confidential Information of the Company to terminate his/her employment with the Company and/or to seek employment with my new or prospective employer, or any other company. | ||
| (c) | I agree that during my employment and for a period of two years following the termination of my employment for any reason, I will not engage in activities which are entirely or in part the same as or similar to activities in which I engaged at any time during the two years preceding termination of my employment, for any person, company or entity in connection with products, services or technological developments (existing or planned) that are entirely or in part the same as, similar to, or competitive with, any products, services or technological developments (existing or planned) on which I worked at any time during the two years preceding the termination of my employment. This paragraph applies in the countries in which I have physically been present performing work for the Company at any time during the two years preceding termination of my employment. | ||
| (d) | I agree that during my employment and for a period of two years following the termination of my employment for any reason, I will not, directly or indirectly, on behalf of myself or any |
-1-
| other person, company or entity, solicit or participate in soliciting, products or services competitive with or similar to products or services offered by, manufactured by, designed by or distributed by the Company to any person, company or entity which was a customer or potential customer for such products or services and with which I had direct or indirect contact regarding those products or services or about which I learned Confidential Information at any time during the two years prior to my termination of employment with the Company. |
| (e) | I agree that during my employment and for a period of two years following the termination of my employment for any reason, I will not directly or indirectly, in any capacity, provide products or services competitive with or similar to products or services offered by the Company to any person, company or entity which was a customer for such products or services and with which customer I had direct or indirect contact regarding those products or services or about which customer I learned Confidential Information at any time during the two years prior to termination of my employment with the Company. |
| 2. | I acknowledge that the Covered Options are subject to the terms and conditions of the Company’s Policy Regarding Recoupment of Incentive Payments upon Financial Restatement (such policy, as it may be amended from time to time, being the “Recoupment Policy”). The Recoupment Policy provides for determinations by the Company’s independent directors that, as a result of intentional misconduct by me, the Company’s financial results were restated (a “Policy Restatement”). In the event of a Policy Restatement, the Company’s independent directors may require, among other things (a) cancellation of any of the Covered Options that remain outstanding; and/or (b) reimbursement of any gains realized in respect of the Covered Options, if and to the extent the conditions set forth in the Recoupment Policy apply. Any determinations made by the independent directors in accordance with the Recoupment Policy shall be binding upon me. The Recoupment Policy is in addition to any other remedies which may be otherwise available at law, in equity or under contract, to the Company. | |
| 3. | I agree that by accepting the Covered Options, if I violate the terms of paragraphs 1(a) through and including (e) of this Agreement, then, in addition to any other remedies available in law and/or equity in any country, all of my vested and unvested Covered Options will terminate and no longer be exercisable, and for all Covered Options exercised within two years prior to the termination of my employment for any reason or anytime after termination of my employment for any reason, I will immediately pay to the Company the difference between the exercise price on the date of grant as reflected in the Award Document for the Covered Options and the market price of the Covered Options on the date of exercise (the “spread”). | |
| 4. | The requirements of paragraphs 1(a) through and including (e) of this Agreement can be waived or modified only upon the prior written consent of Motorola, Inc. | |
| 5. | I acknowledge that the promises in this Agreement, not any employment of or services performed by me in the course and scope of that employment, are the sole consideration for the Covered Options. I agree the Company shall have the right to assign this Agreement which shall not affect the validity or enforceability of this Agreement. This Agreement shall inure to the benefit of the Company assigns and successors. | |
| 6. | I agree that during my employment and for a period of two years following the termination of my employment for any reason, I will immediately inform the Company of (i) the identity of my new employer (or the nature of any start-up business, consulting arrangements or self-employment), (ii) my new title, and (iii) my job duties and responsibilities. I hereby authorize the Company to provide a copy of this Agreement to my new employer. I further agree to provide information to |
-2-
| the Company as may from time to time be requested in order to determine my compliance with the terms of this Agreement. |
| 7. | I acknowledge that the harm caused to the Company by the breach or anticipated breach of paragraphs 1(a), (b), (c), (d) and/or (e) of this Agreement will be irreparable and I agree the Company may obtain injunctive relief against me in addition to and cumulative with any other legal or equitable rights and remedies the Company may have pursuant to this Agreement, any other agreements between me and the Company for the protection of the Company’s Confidential Information, or law, including the recovery of liquidated damages. I agree that any interim or final equitable relief entered by a court of competent jurisdiction, as specified in paragraph 10 below, will, at the request of the Company, be entered on consent and enforced by any such court having jurisdiction over me. This relief would occur without prejudice to any rights either party may have to appeal from the proceedings that resulted in any grant of such relief. | |
| 8. | With respect to the Covered Options, this Agreement is my entire agreement with the Company. No waiver of any breach of any provision of this Agreement by the Company shall be construed to be a waiver of any succeeding breach or as a modification of such provision. The provisions of this Agreement shall be severable and in the event that any provision of this Agreement shall be found by any court as specified in paragraph 10 below to be unenforceable, in whole or in part, the remainder of this Agreement shall nevertheless be enforceable and binding on the parties. I also agree that the court may modify any invalid, overbroad or unenforceable term of this Agreement so that such term, as modified, is valid and enforceable under applicable law. Further, I affirmatively state that I have not, will not and cannot rely on any representations not expressly made herein. | |
| 9. | I accept the terms of this Agreement and the above option(s) to purchase shares of the Common Stock of the Company, subject to the terms of this Agreement, the 2006 Plan, and any Award Document issued pursuant thereto. I am familiar with the 2006 Plan and agree to be bound by it to the extent applicable, as well as by the actions of the Company’s Board of Directors or any committee thereof. | |
| 10. | I agree that this Agreement and the 2006 Plan, and any Award Document issued pursuant thereto, together constitute an agreement between the Company and me. I further agree that this Agreement is governed by the laws of Illinois, without giving effect to any state’s principles of Conflicts of Laws, and any legal action related to this Agreement shall be brought only in a federal or state court located in Illinois, USA. I accept the jurisdiction of these courts and consent to service of process from said courts solely for legal actions related to this Agreement and the Covered Options. |
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| 1. | Award of Restricted Stock Units . The Company hereby grants to Grantee a total of Motorola restricted stock units (the “ Units ”) subject to the terms and conditions set forth below and subject to adjustment as provided in the 2006 Omnibus Plan. The units are granted pursuant to the 2006 Omnibus Plan and are subject to all of the terms and conditions of the 2006 Omnibus Plan. | |
| 2. | Restrictions . The Units are being awarded to Grantee subject to the transfer and forfeiture conditions set forth below (the “ Restrictions ”): |
| a. | Grantee may not directly or indirectly, by operation of law or otherwise, voluntarily or involuntarily, sell, assign, pledge, encumber, charge or otherwise transfer any of the Units still subject to Restrictions. The Units shall be forfeited if Grantee violates or attempts to violate these transfer Restrictions. Motorola shall have the right to assign this Agreement, which shall not affect the validity or enforceability of this Agreement. This Agreement shall inure to the benefit of assigns and successors of Motorola. | ||
| b. | Any Units still subject to the Restrictions shall be automatically forfeited upon the Grantee’s termination of employment with Motorola or a Subsidiary for any reason other than death, Total and Permanent Disability, or Involuntary Termination due to (i) a Divestiture or (ii) for a reason other than for Serious Misconduct. For purposes of this Agreement, a “Subsidiary” is any corporation or other entity in which a 50 percent or greater interest is held directly or indirectly by Motorola and which is consolidated for financial reporting purposes. Total and Permanent Disability is defined in Section 3(f). | ||
| c. | If Grantee engages in any of the following conduct for any reason, in addition to all remedies in law and/or equity available to the Company or any Subsidiary, Grantee shall forfeit all restricted stock units under the Award whose Restrictions have not lapsed, and, for all restricted stock units under the Award whose |
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| Restrictions have lapsed, Grantee shall immediately pay to the Company the Fair Market Value (as defined in Section 7 below) of Motorola Common Stock (“ Common Stock ”) on the date(s) such Restrictions lapsed, without regard to any taxes that may have been deducted from such amount. For purposes of subparagraphs (i) through and including (v) below, “Company” or “Motorola” shall mean Motorola, Inc. and/or any of its Subsidiaries: |
| (i) | During the course of Grantee’s employment and thereafter, Grantee uses or discloses, except on behalf of the Company and pursuant to the Company’s directions, any Company Confidential Information. “Confidential Information” means information concerning the Company and its business that is not generally known outside the Company, and includes (A) trade secrets; (B) intellectual property; (C) the Company’s methods of operation and Company processes; (D) information regarding the Company’s present and/or future products, developments, processes and systems, including invention disclosures and patent applications; (E) information on customers or potential customers, including customers’ names, sales records, prices, and other terms of sales and Company cost information; (F) Company personnel data; (G) Company business plans, marketing plans, financial data and projections; and (H) information received in confidence by the Company from third parties. Information regarding products, services or technological innovations in development, in test marketing or being marketed or promoted in a discrete geographic region, which information the Company or one of its affiliates is considering for broader use, shall be deemed not generally known until such broader use is actually commercially implemented; and/or | ||
| (ii) | During Grantee’s employment and for a period of two years following the termination of Grantee’s employment for any reason, Grantee hires, recruits, solicits or induces, or causes, allows, permits or aids others to hire, recruit, solicit or induce, or to communicate in support of those activities, any employee of the Company who possesses Confidential Information of the Company to terminate his/her employment with the Company and/or to seek employment with Grantee’s new or prospective employer, or any other company; and/or | ||
| (iii) | During Grantee’s employment and for a period of two years following the termination of Grantee’s employment for any reason, Grantee engages in activities which are entirely or in part the same as or similar to activities in which Grantee engaged at any time during the two years preceding termination of Grantee’s employment with the Company, for any person, company or entity in connection with products, services or technological developments (existing or planned) that are entirely or in part the same as, similar to, or competitive with, any products, services or technological developments (existing or planned) on which Grantee worked at any time during the two years preceding termination of Grantee’s employment. This paragraph applies in countries in which Grantee |
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| has physically been present performing work for the Company at any time during the two years preceding termination of Grantee’s employment; and/or |
| (iv) | During Grantee’s employment and for a period of two years following the termination of Grantee’s employment for any reason, Grantee, directly or indirectly, on behalf of Grantee or any other person, company or entity, solicits or participates in soliciting, products or services competitive with or similar to products or services offered by, manufactured by, designed by or distributed by the Company to any person, company or entity which was a customer or potential customer for such products or services and with which Grantee had direct or indirect contact regarding those products or services or about which Grantee learned confidential information at any time during the two years prior to Grantee’s termination of employment with the Company; and/or | ||
| (v) | During Grantee’s employment and for a period of two years following the termination of Grantee’s employment for any reason, Grantee, directly or indirectly, in any capacity, provides products or services competitive with or similar to products or services offered by the Company to any person, company or entity which was a customer for such products or services and with which customer Grantee had direct or indirect contact regarding those products or services or about which customer Grantee learned Confidential Information at any time during the two years prior to Grantee’s termination of employment with the Company. |
| d. | The Units are subject to the terms and conditions of the Company’s Policy Regarding Recoupment of Incentive Payments upon Financial Restatement (such policy, as it may be amended from time to time, being the “ Recoupment Policy ”). The Recoupment Policy provides for determinations by the Company’s independent directors that, as a result of intentional misconduct by Grantee, the Company’s financial results were restated (a “ Policy Restatement ”). In the event of a Policy Restatement, the Company’s independent directors may require, among other things (a) cancellation of any of the Units that remain outstanding; and/or (b) reimbursement of any gains in respect of the Units, if and to the extent the conditions set forth in the Recoupment Policy apply. Any determinations made by the independent directors in accordance with the Recoupment Policy shall be binding upon Grantee. The Recoupment Policy is in addition to any other remedies which may be otherwise available at law, in equity or under contract, to the Company. | ||
| e. | The Company will not be obligated to pay Grantee any consideration whatsoever for forfeited Units. |
| 3. | Vesting . Subject to the remaining terms and conditions of this Award, and provided the Units have not been forfeited as described in Section 2 above, the Units will vest as follows. |
| a. | Eligible Units will vest upon the earlier of (i) a Separation (as defined in Section 19) or (ii) a Public Announcement (as defined in Section 19); provided, |
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| however, that any Units that are not Eligible Units on such Separation or Public Announcement will vest upon the date that such Units become Eligible Units. |
| b. | The Units will become “Eligible Units” in accordance with the following schedule: |
| Percentage | Date | |
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33.3%
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May 7, 2010 | |
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33.3%
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May 7, 2011 | |
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33.4%
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May 7, 2012 |
| c. | Except as described below in Sections 2(e)(f) and (g) , no Units will vest unless and until such Units are Eligible Units. | ||
| d. | For purposes of this Agreement, the “Restriction Period” applicable to a Unit shall refer to the period of time beginning on the Date of Grant and ending on the date that the Restrictions applicable to such Unit shall lapse, as set forth in Section 3(a) (b) and (c) above. | ||
| e. | The Units will also vest as follows: |
| (i) | If a Change in Control of the Company occurs and the successor corporation (or parent thereof) does not assume this Award or replace it with a comparable award; provided, further, that with respect to any Award that is assumed or replaced, such assumed or replaced awards shall provide that the Restrictions shall lapse if Grantee is involuntarily terminated (for a reason other than “Cause”) or quits for “Good Reason” within 24 months of the Change in Control. For purposes of this paragraph, the terms “Change in Control”, “Cause ” and “Good Reason” are defined in the 2006 Incentive Plan; | ||
| (ii) | Upon termination of Grantee’s employment by Motorola or a Subsidiary by Total and Permanent Disability. “Total and Permanent Disability” means for (x) U.S. employees, entitlement to long term disability benefits under the Motorola Disability Income Plan, as amended and any successor plan or a determination of a permanent and total disability under a state workers compensation statute and (y) non-U.S. employees, as established by applicable Motorola policy or as required by local regulations; or | ||
| (iii) | If the Grantee dies. |
| f. | In the case of Involuntary Termination due to a Divestiture before the expiration of the Restriction Period, if the Units have not been forfeited as described in Section 2 above, then the Restrictions shall lapse on a pro rata basis determined by dividing (i) the number of completed full months of service by the Grantee |
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| from the Award Date to the employee’s date of termination by (ii) thirty-six months. |
| g. | In the case of Involuntary Termination for a reason other than for Serious Misconduct prior to a Separation or Public Announcement and before the expiration of the Restriction Period, the Units that are not vested shall be forfeited. | ||
| h. | In the case of Involuntary Termination for a reason other than for Serious Misconduct on or after a Separation or Public Announcement and before the expiration of the Restriction Period, if the Units have not been forfeited as described in Section 2 above, then the Restrictions shall lapse on a pro rata basis determined by dividing (i) the number of completed full months of service by the Grantee from the Award Date to the employee’s date of termination by (ii) thirty-six months. | ||
| i. | “Involuntary Termination due to a Divestiture” for purposes of this Agreement means if Grantee accepts employment with another company in direct connection with the sale, lease, outsourcing arrangement or any other type of asset transfer or transfer of any portion of a facility or any portion of a discrete organizational unit of Motorola or a Subsidiary that is not a Separation (as defined below), or if Grantee remains employed by a Subsidiary that is sold or whose shares are distributed to the Motorola stockholders in a spin-off or similar transaction that is not a Separation (a “Divestiture”). | ||
| j. | “Serious Misconduct” for purposes of this Agreement means any misconduct identified as a ground for termination in the Motorola Code of Business Conduct, or the human resources policies, or other written policies or procedures. | ||
| k. | If, during the Restriction Period, the Grantee takes a Leave of Absence from Motorola or a Subsidiary, the Units will continue to be subject to this Agreement. If the Restriction Period expires while the Grantee is on a Leave of Absence the Grantee will be entitled to the Units even if the Grantee has not returned to active employment. “Leave of Absence” means an approved leave of absence from Motorola or a Subsidiary that is not a termination of employment, as determined by Motorola. | ||
| l. | To the extent the Restrictions lapse under this Section 3 with respect to the Units, they will be free of the terms and conditions of this Award (other than 2(c)). |
| 4. | Adjustments . If the number of outstanding shares of Common Stock is changed as a result of a stock split or the like without additional consideration to the Company, the number of Units subject to this Award shall be adjusted to correspond to the change in the outstanding shares of Common Stock. | |
| 5. | Dividends . No dividends (or dividend equivalents) shall be paid with respect to Units credited to the Grantee’s account. |
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| 6. | Delivery of Certificates or Equivalent . |
| a. | Upon the lapse of Restrictions applicable to the Units, the Company shall, at its election, either (i) deliver to the Grantee a certificate representing a number of shares of Common Stock equal to the number of Units upon which such Restrictions have lapsed, or (ii) establish a brokerage account for the Grantee and credit to that account the number of shares of Common Stock of the Company equal to the number of Units upon which such Restrictions have lapsed. | ||
| b. | Subject to Section 18, the actions contemplated by clauses (i) and (ii) above shall occur within 60 days following the date that the applicable Units have vested. |
| 7. | Withholding Taxes . The Company is entitled to withhold applicable taxes for the respective tax jurisdiction attributable to this Award or any payment made in connection with the Units. Grantee may satisfy any minimum withholding obligation in whole or in part by electing to have the plan administrator retain shares of Common Stock deliverable in connection with the Units having a Fair Market Value on the date the Restrictions applicable to the Units lapse equal to the amount to be withheld. “Fair Market Value” for this purpose shall be the closing price for a share of Common Stock on the date the Restrictions applicable to the Units lapse (the “Restrictions Lapse Date”) as reported for the New York Stock Exchange- Composite Transactions in the Wall Street Journal at www.online.wsj.com or, for purposes of imposing sanctions under Section 2(d), on any date specified therein. In the event the New York Stock Exchange is not open for trading on the Restrictions Lapse Date, or if the Common Stock does not trade on such day, Fair Market Value for this purpose shall be the closing price of the Common Stock on the last trading day prior to the Restrictions Lapse Date. | |
| 8. | Voting and Other Rights . |
| a. | Grantee shall have no rights as a stockholder of the Company in respect of the Units, including the right to vote and to receive cash dividends and other distributions until delivery of certificates representing shares of Common Stock in satisfaction of the Units. | ||
| b. | The grant of Units does not confer upon Grantee any right to continue in the employ of the Company or a Subsidiary or to interfere with the right of the Company or a Subsidiary, to terminate Grantee’s employment at any time. |
| 9. | Agreement Following Termination of Employment . Grantee agrees that upon termination of employment with Motorola or a Subsidiary, Grantee will immediately inform Motorola of (a) the identity of any new employer (or the nature of any start-up business or self-employment), (b) Grantee’s new title, and (c) Grantee’s job duties and responsibilities. Grantee hereby authorizes Motorola or a Subsidiary to provide a copy of this Award Document to Grantee’s new employer. Grantee further agrees to provide information to Motorola or a Subsidiary as may from time to time be requested in order to determine his/her compliance with the terms hereof. | |
| 10. | Consent to Transfer Personal Data . By accepting this award, Grantee voluntarily acknowledges and consents to the collection, use, processing and transfer of personal data as described in this paragraph. Grantee is not obliged to consent to such collection, use, processing and transfer of personal data. However, failure to provide the consent may affect Grantee’s ability to participate in the Plan. Motorola, its Subsidiaries and Grantee’s employer |
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| hold certain personal information about Grantee, that may include his/her name, home address and telephone number, date of birth, social security number or other employee identification number, salary grade, hire data, salary, nationality, job title, any shares of stock held in Motorola, or details of all restricted stock units or any other entitlement to shares of stock awarded, canceled, purchased, vested, or unvested, for the purpose of managing and administering the Plan (“Data”). Motorola and/or its Subsidiaries will transfer Data amongst themselves as necessary for the purpose of implementation, administration and management of Grantee’s participation in the Plan, and Motorola and/or any of its Subsidiaries may each further transfer Data to any third parties assisting Motorola in the implementation, administration and management of the Plan. These recipients may be located throughout the world, including the United States. Grantee authorizes them to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing Grantee’s participation in the Plan, including any requisite transfer of such Data as may be required for the administration of the Plan and/or the subsequent holding of shares of stock on Grantee’s behalf to a broker or other third party with whom Grantee may elect to deposit any shares of stock acquired pursuant to the Plan. Grantee may, at any time, review Data, require any necessary amendments to it or withdraw the consents herein in writing by contacting Motorola; however, withdrawing consent may affect Grantee’s ability to participate in the Plan. |
| 11. | Nature of Award . By accepting this Award Agreement, the Grantee acknowledges his or her understanding that the grant of Units under this Award Agreement is completely at the discretion of Motorola, and that Motorola’s decision to make this Award in no way implies that similar awards may be granted in the future or that Grantee has any guarantee of future employment. Nor shall this or any such grant interfere with Grantee’s right or the Company’s right to terminate such employment relationship at any time, with or without cause, to the extent permitted by applicable laws and any enforceable agreement between Grantee and the Company. In addition, the Grantee hereby acknowledges that he or she has entered into employment with Motorola or a Subsidiary upon terms that did not include this Award or similar awards, that his or her decision to continue employment is not dependent on an expectation of this Award or similar awards, and that any amount received under this Award is considered an amount in addition to that which the Grantee expects to be paid for the performance of his or her services. Grantee’s acceptance of this Award is voluntary. The Award is not part of normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-service awards, pension, or retirement benefits or similar payments, notwithstanding any provision of any compensation, insurance agreement or benefit plan to the contrary, | |
| 12. | Remedies for Breach . Grantee hereby acknowledges that the harm caused to the Company by the breach or anticipated breach of Sections 2(c)(i), (ii), (iii), (iv) and/or (v) of this Agreement will be irreparable and further agrees the Company may obtain injunctive relief against the Grantee in addition to and cumulative with any other legal or equitable rights and remedies the Company may have pursuant to this Agreement, any other agreements between the Grantee and the Company for the protection of the Company’s Confidential Information, or law, including the recovery of liquidated damages. Grantee agrees that any interim or final equitable relief entered by a court of competent jurisdiction, as specified in Section 15 below, will, at the request of the Company, be entered on consent and enforced by any such court having jurisdiction over the Grantee. This relief would occur without prejudice to any rights either party may have to appeal from the proceedings that resulted in any grant of such relief. | |
| 13. | Acknowledgements . With respect to the subject matter of Sections 2(c)(i), (ii), (iii), (iv) and |
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| (v) and Sections 12 and 15 hereof, this Agreement is the entire agreement with the Company. No waiver of any breach of any provision of this Agreement by the Company shall be construed to be a waiver of any succeeding breach or as a modification of such provision. The provisions of this Agreement shall be severable and in the event that any provision of this Agreement shall be found by any court as specified in Section 15 below to be unenforceable, in whole or in part, the remainder of this Agreement shall nevertheless be enforceable and binding on the parties. Grantee hereby agrees that the court may modify any invalid, overbroad or unenforceable term of this Agreement so that such term, as modified, is valid and enforceable under applicable law. Further, by accepting any Award under this Agreement, Grantee affirmatively states that he has not, will not and cannot rely on any representations not expressly made herein. |
| 14. | Funding . No assets or shares of Common Stock shall be segregated or earmarked by the Company in respect of any Units awarded hereunder. The grant of Units hereunder shall not constitute a trust and shall be solely for the purpose of recording an unsecured contractual obligation of the Company. | |
| 15. | Governing Law . All questions concerning the construction, validity and interpretation of this Award shall be governed by and construed according to the law of the State of Illinois without regard to any state’s conflicts of law principles. Any disputes regarding this Award or Agreement shall be brought only in the state or federal courts of Illinois. | |
| 16. | Waiver . The failure of the Company to enforce at any time any provision of this Award shall in no way be construed to be a waiver of such provision or any other provision hereof. | |
| 17. | Actions by the Compensation Committee . The Committee may delegate its authority to administer this Agreement. The actions and determinations of the Compensation Committee or delegate shall be binding upon the parties. | |
| 18. | 409A Compliance . Notwithstanding any provision in this Award to the contrary, if the Grantee is a “specified employee” (certain officers of Motorola, within the meaning of Treasury Regulation Section 1.409A-1(i) and using the identification methodology selected by Motorola from time to time) on the date of the Grantee’s termination of employment, any payment which would be considered “nonqualified deferred compensation” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), that the Grantee is entitled to receive upon termination of employment and which otherwise would be paid or delivered during the six month period immediately following the date of the Grantee’s termination of employment will instead be paid or delivered on the earlier of (i) the first day of the seventh month following the date of the Grantee’s termination of employment and (ii) death. Notwithstanding any provision in this Award that requires the Company to pay or deliver payments with respect to Units upon vesting (or within 60 days following the date that the applicable Units vest) if the event that causes the applicable Units to vest is not a permissible payment event as defined in Section 409A(a)(2) of the Code, then the payment with respect to such Units will instead be paid or delivered on the earlier of (i) the specified date of payment or delivery originally provided for such Units and (ii) the date of the Grantee’s termination of employment (subject to any delay required by the first sentence of this paragraph). Payment shall be made within 60 days following the applicable payment date. For purposes of determining the time of payment or delivery of any payment the Grantee is entitled to receive upon termination of employment, the determination of whether the Grantee has experienced a termination of employment will be determined by Motorola in a manner consistent with the definition of “separation from service” under the default rules of Section 409A of the Code. |
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| 19. | Definitions . Any capitalized terms used herein that are not otherwise defined below or elsewhere in this Award Agreement shall have the same meaning provided under the 2006 Omnibus Plan. |
| a. | “Public Announcement” means the announcement by the Company to not effect a separation as described on page 41 of the Motorola, Inc. Form 10- K for fiscal year 2008. | ||
| b. | “Separation” means the separation of the business structures as described on page 41 of the Motorola Inc. Form 10- K for fiscal year 2008. |
| 20. | Acceptance of Terms and Conditions . By electronically accepting this Award within 30 days after the date of the electronic mail notification by the Company to Grantee of the grant of this Award (“ Email Notification Date ”), Grantee agrees to be bound by the foregoing terms and conditions, the 2006 Incentive Plan and any and all rules and regulations established by Motorola in connection with awards issued under the 2006 Incentive Plan. If Grantee does not electronically accept this Award within 30 days of the Email Notification Date Grantee will not be entitled to the Units. | |
| 21. | Plan Documents . The 2006 Incentive Plan and the Prospectus for the 2006 Incentive Plan are available at http://myhr.mot.com/pay.finances/awards_incentives/stock_options/plan_documents.jsp or from Global Rewards, 1303 East Algonquin Road, Schaumburg, IL 60196, (847) 576-7885. |
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| (a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| (d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| (a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| (e) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| (f) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (g) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
| (h) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| (c) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (d) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| (i) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
| (j) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| (k) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| (l) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
| (e) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| (f) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
| (1) | the quarterly report on Form 10-Q for the period ended April 4, 2009 (the “Quarterly Report”), which this statement accompanies fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and | |
| (2) | the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of Motorola, Inc. |
| (1) | the quarterly report on Form 10-Q for the period ended April 4, 2009 (the “Quarterly Report”), which this statement accompanies fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and | |
| (2) | the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of Motorola, Inc. |
| (1) | the quarterly report on Form 10-Q for the period ended April 4, 2009 (the “Quarterly Report”), which this statement accompanies fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and | |
| (2) | the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of Motorola, Inc. |