What is the primary purpose of the new 2009 incentive plans?

The primary purpose of the 2009 Motorola Incentive Plan (2009 MIP) and the 2009 Motorola Long Range Incentive Plan (2009 LRIP) is to retain and attract talent, align employee efforts with the company's business goals, and reward employees for strong business performance, thereby driving shareholder value.

How will employee performance be measured under these new plans?

Under the 2009 MIP, performance is measured annually based on Controllable Free Cash Flow and Operating Earnings. For the 2009 LRIP's first three-year cycle (2009-2011), performance is measured by Relative Total Shareholder Return. The Compensation Committee determines the specific metrics and achievement levels.

Are there any changes to executive compensation related to stock options?

Yes, the company is proposing an amendment to its Omnibus Incentive Plan to permit a one-time stock option exchange program, which will require stockholder approval. Additionally, an amendment clarifies that any repricing of equity awards will require stockholder approval, enhancing transparency and investor oversight.

When will awards earned under these plans be paid out?

Awards earned under the 2009 MIP will be paid in cash as soon as administratively practicable in the calendar year following the close of the plan year. Awards under the 2009 LRIP will be paid in cash or Motorola common stock, as determined by the committee, in the calendar year following the last year of the performance cycle.

MSI 8-K: Leadership Changes

Summary

This 8-K filing from Motorola, Inc. (MSI) on March 23, 2009, primarily announces the approval and details of two new incentive plans: the 2009 Motorola Incentive Plan (2009 MIP) and the 2009 Motorola Long Range Incentive Plan (2009 LRIP). These plans are designed to retain talent, attract new employees, align individual efforts with company goals, and reward strong business performance. The 2009 MIP replaces its 2008 predecessor and focuses on annual performance based on Controllable Free Cash Flow and Operating Earnings, with awards paid in cash. The 2009 LRIP, replacing the 2006 version, targets executive officers with multi-year performance periods, with the first cycle (2009-2011) based on Relative Total Shareholder Return, and awards payable in cash or stock. Additionally, the filing discloses amendments to the Motorola Omnibus Incentive Plan of 2006, including a proposed amendment to permit a one-time stock option exchange program (subject to stockholder approval) and an amendment clarifying that repricing equity awards requires stockholder approval. These updates reflect the company's strategy to motivate its workforce and align executive compensation with shareholder interests, particularly during a period of economic uncertainty.

Key Highlights

1Motorola, Inc. approved the 2009 Motorola Incentive Plan (2009 MIP), effective January 1, 2009, replacing the 2008 plan.
2The 2009 MIP is an annual incentive plan for eligible employees, including named executive officers, with awards based on Controllable Free Cash Flow and Operating Earnings.
3The company also approved the 2009 Motorola Long Range Incentive Plan (2009 LRIP) for executive officers, effective January 1, 2009, replacing the 2006 LRIP.
4The 2009 LRIP features multi-year performance periods, with the first cycle (2009-2011) measured by Relative Total Shareholder Return.
5Amendments to the Omnibus Incentive Plan of 2006 were approved, including a provision for a potential stock option exchange program requiring stockholder approval.
6An amendment clarifies that repricing of equity awards requires stockholder approval, reinforcing investor protections.
7Awards under the 2009 MIP will be paid in cash, while awards under the 2009 LRIP can be paid in cash or Motorola common stock.

Motorola Solutions, Inc. 8-K Report, Executive Changes (Mar 23, 2009)

Summary

Key Highlights

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