MOTOROLA OMNIBUS INCENTIVE PLAN
OF 2006
(as amended through March 19,
2009, subject to stockholder approval as indicated)
1.
Purpose . The purposes of the Motorola Omnibus Incentive
Plan of 2006 (the “Plan”) are (i) to encourage
outstanding individuals to accept or continue employment with
Motorola, Inc. (“Motorola” or the
“Company”) and its Subsidiaries or to serve as
directors of Motorola, and (ii) to furnish maximum incentive to
those persons to improve operations and increase profits and to
strengthen the mutuality of interest between those persons and
Motorola’s stockholders by providing them stock options and
other stock and cash incentives.
2.
Administration . The Plan will be administered by a
Committee (the “Committee”) of the Motorola Board of
Directors consisting of two or more directors as the Board may
designate from time to time, each of whom shall satisfy such
requirements as:
(a) the
Securities and Exchange Commission may establish for administrators
acting under plans intended to qualify for exemption under
Rule 16b-3 or its successor under the Securities Exchange Act
of 1934 (the “Exchange Act”);
(b) the
New York Stock Exchange may establish pursuant to its rule-making
authority; and
(c) the
Internal Revenue Service may establish for outside directors acting
under plans intended to qualify for exemption under Section 162(m)
of the Internal Revenue Code of 1986, as amended (the
“Code”).
The
Compensation and Leadership Committee shall serve as the Committee
administering the Plan until such time as the Board designates a
different Committee.
The Committee
shall have the discretionary authority to construe and interpret
the Plan and any benefits granted thereunder, to establish and
amend rules for Plan administration, to change the terms and
conditions of options and other benefits at or after grant, to
correct any defect or supply any omission or reconcile any
inconsistency in the Plan or in any option or other benefit granted
under the Plan, and to make all other determinations which it deems
necessary or advisable for the administration of the Plan. The
determinations of the Committee shall be made
in accordance
with their judgment as to the best interests of Motorola and its
stockholders and in accordance with the purposes of the Plan. Any
determination of the Committee under the Plan may be made without
notice or meeting of the Committee, in writing signed by all the
Committee members. The Committee may authorize one or more officers
of the Company to select employees to participate in the Plan and
to determine the number of option shares and other awards to be
granted to such participants, except with respect to awards to
officers subject to Section 16 of the Exchange Act or officers
who are, or who are reasonably expected to be, “covered
employees” within the meaning of Section 162(m) of the Code
(“Covered Employees”) and any reference in the Plan to
the Committee shall include such officer or officers.
3.
Participants . Participants may consist of all employees of
Motorola and its Subsidiaries and all non-employee directors of
Motorola; provided, however, the following individuals shall be
excluded from participation in the plan: (a) contract labor
(including without limitation black badges, brown badges,
contractors, consultants, contract employees and job shoppers)
regardless of length of service; (b) employees whose base wage
or base salary is not processed for payment by a Payroll Department
of Motorola or any Subsidiary; (c) any individual performing
services under an independent contractor or consultant agreement, a
purchase order, a supplier agreement or any other agreement that
the Company enters into for service. Any corporation or other
entity in which a 50% or greater interest is at the time directly
or indirectly owned by Motorola and which Motorola consolidates for
financial reporting purposes shall be a “Subsidiary”
for purposes of the Plan. Designation of a participant in any year
shall not require the Committee to designate that person to receive
a benefit in any other year or to receive the same type or amount
of benefit as granted to the participant in any other year or as
granted to any other participant in any year. The Committee shall
consider all factors that it deems relevant in selecting
participants and in determining the type and amount of their
respective benefits.
4. Shares
Available under the Plan . There is hereby reserved for
issuance under the Plan an aggregate of 80 million shares of
Motorola common stock. In connection with approving this Plan, and
contingent upon receipt of stockholder approval of this Plan, the
Board of Directors has approved a merger of the Motorola Omnibus
Incentive Plan of 2003, Motorola Omnibus Incentive Plan of 2002,
the Motorola Omnibus Incentive Plan of 2000, and the
Motorola
Amended and Restated Incentive Plan of 1998 (collectively, the
“Prior Plans”) into this Plan, so that on or after the
date this Plan is approved by stockholders, the maximum number of
shares reserved for issuance under this Plan shall not exceed
(a) the total number of shares reserved for issuance under
this Plan plus (b) the number of shares approved and available
for grant under the Prior Plans as of the date of such stockholder
approval plus (c) any shares that become available for
issuance pursuant to the remainder of this section 4. If there is
(i) a lapse, expiration, termination, forfeiture or
cancellation of any Stock Option or other benefit outstanding under
this Plan, a Prior Plan or under the Motorola Share Option Plan of
1996 (the “1996 Plan”), prior to the issuance of shares
thereunder or (ii) a forfeiture of any shares of restricted
stock or shares subject to stock awards granted under this Plan, a
Prior Plan or the 1996 Plan prior to vesting, then the shares
subject to these options or other benefits shall be added to the
shares available for benefits under the Plan (to the extent
permitted under the terms of the Prior Plans or the 1996 Plan if
the award originally occurred under such plan). Shares covered by a
benefit granted under the Plan shall not be counted as used unless
and until they are actually issued and delivered to a participant.
Any shares covered by a Stock Appreciation Right (including a Stock
Appreciation Right settled in stock which the Committee, in its
discretion, may substitute for an outstanding Stock Option) shall
be counted as used only to the extent shares are actually issued to
the participant upon exercise of the right. In addition, any shares
of common stock exchanged by an optionee as full or partial payment
of the exercise price under any stock option exercised under the
Plan, any shares retained by Motorola to comply with applicable
income tax withholding requirements, and any shares covered by a
benefit which is settled in cash, shall be added to the shares
available for benefits under the Plan (to the extent permitted
under the terms of the Prior Plans or the 1996 Plan if the award
originally occurred under such plan). All shares issued under the
Plan may be either authorized and unissued shares or issued shares
reacquired by Motorola. All of the available shares may, but need
not, be issued pursuant to the exercise of Incentive Stock Options
(as defined in Section 422 of the Code); provided, however,
notwithstanding an Option’s designation, to the extent that
Incentive Stock Options are exercisable for the first time by the
Participant during any calendar year with respect to Shares whose
aggregate Fair Market Value exceeds $100,000 (regardless of whether
such Incentive Stock Options were granted under this Plan, the
Prior Plans or the 1996 Plan), such Options shall be treated as
nonqualified Stock Options.
Under
the Plan, no participant may receive in any calendar year
(i) Stock Options relating to more than 3,000,000 shares,
(ii) Stock Appreciation Rights relating to more than 3,000,000
shares, (iii) Restricted Stock or Restricted Stock Units
relating to more than 1,500,000 shares, (iv) Performance Shares
relating to more than 1,500,000 shares, or (v) Deferred Stock
Units relating to more than 50,000 shares. No non-employee director
may receive in any calendar year Stock Options relating to more
than 50,000 shares or Restricted Stock Units or Deferred Stock
Units relating to more than 50,000 shares.
The
shares reserved for issuance and each of the limitations set forth
above shall be subject to adjustment in accordance with section 16
hereof.
5. Types
of Benefits . Benefits under the Plan shall consist of Stock
Options, Stock Appreciation Rights, Restricted Stock, Restricted
Stock Units, Deferred Stock Units, Performance Shares, Performance
Cash Awards, Annual Management Incentive Awards and Other Stock or
Cash Awards, all as described below.
6. Stock
Options . Stock Options may be granted to participants, at any
time as determined by the Committee. The Committee shall determine
the number of shares subject to each option and whether the option
is an Incentive Stock Option. The exercise price for each option
shall be determined by the Committee but shall not be less than
100% of the fair market value of Motorola’s common stock on
the date the option is granted. Each option shall expire at such
time as the Committee shall determine at the time of grant. Options
shall be exercisable at such time and subject to such terms and
conditions as the Committee shall determine; provided, however,
that no option shall be exercisable later than the tenth
anniversary of its grant. The exercise price, upon exercise of any
option, shall be payable to Motorola in full by (a) cash
payment or its equivalent, (b) tendering previously acquired
shares having a fair market value at the time of exercise equal to
the exercise price or certification of ownership of such
previously-acquired shares, (c) to the extent permitted by
applicable law, delivery of a properly executed exercise notice,
together with irrevocable instructions to a broker to promptly
deliver to Motorola the amount of sale proceeds from the option
shares or loan proceeds to pay the exercise price and any
withholding taxes due to Motorola, and (d) such other methods
of payment as the
Committee, at
its discretion, deems appropriate. Notwithstanding any other
provision of the Plan to the contrary, upon approval of the
Company’s stockholders, the Committee may provide for, and
the Company may implement, a one time only option exchange offer,
pursuant to which certain outstanding Stock Options could, at the
election of the person holding such Stock Option, be tendered to
the Company for cancellation in exchange for the issuance of a
lesser amount of Stock Options with a lower exercise price, or
other equity benefit as approved by the Committee, provided that
such one time only option exchange is implemented within twelve
months of the date of such stockholder approval. (Subject to
stockholder approval)
7. Stock
Appreciation Rights . Stock Appreciation Rights
(“SARs”) may be granted to participants at any time as
determined by the Committee. Notwithstanding any other provision of
the Plan, the Committee may, in its discretion, substitute SARs
which can be settled only in stock for outstanding Stock Options.
The grant price of a substitute SAR shall be equal to the exercise
price of the related option and the substitute SAR shall have
substantive terms ( e.g., duration) that are equivalent to
the related option. The grant price of any other SAR shall be equal
to the fair market value of Motorola’s common stock on the
date of its grant. An SAR may be exercised upon such terms and
conditions and for the term as the Committee in its sole discretion
determines; provided, however, that the term shall not exceed the
option term in the case of a substitute SAR or ten years in the
case of any other SAR and the terms and conditions applicable to a
substitute SAR shall be substantially the same as those applicable
to the Stock Option which it replaces. Upon exercise of an SAR, the
participant shall be entitled to receive payment from Motorola in
an amount determined by multiplying the excess of the fair market
value of a share of common stock on the date of exercise over the
grant price of the SAR by the number of shares with respect to
which the SAR is exercised. The payment may be made in cash or
stock, at the discretion of the Committee, except in the case of a
substitute SAR payment may be made only in stock. In no event shall
the Committee cancel any outstanding SAR for the purpose of
reissuing the right to the participant at a lower grant price or
reduce the grant price of an outstanding SAR.
8.
Restricted Stock and Restricted Stock Units . Restricted
Stock and Restricted Stock Units may be awarded or sold to
participants under such terms and conditions as shall be
established by the Committee. Restricted Stock provides
participants the rights to receive shares after vesting in
accordance with the terms of such grant upon the attainment of
certain conditions specified by the Committee. Restricted Stock
Units provide participants the right to receive shares at a future
date after vesting in accordance with the terms of such grant upon
the attainment of certain conditions specified by the Committee.
Restricted Stock and Restricted Stock Units shall be subject to
such restrictions as the Committee determines, including, without
limitation, any of the following:
(a) a
prohibition against sale, assignment, transfer, pledge,
hypothecation or other encumbrance for a specified
period;
(b) a
requirement that the holder forfeit (or in the case of shares or
units sold to the participant, resell to Motorola at cost) such
shares or units in the event of termination of employment during
the period of restriction; or
(c) the
attainment of performance goals including without limitation those
described in section 14 hereof.
All
restrictions shall expire at such times as the Committee shall
specify. In the Committee’s discretion, participants may be
entitled to dividends or dividend equivalents on awards of
Restricted Stock or Restricted Stock Units.
9.
Deferred Stock Units . Deferred Stock Units provide a
participant a vested right to receive shares of common stock in
lieu of other compensation at termination of employment or service
or at a specific future designated date. In the Committee’s
discretion, Deferred Stock Units may include the right to be
credited with dividend equivalents in accordance with the terms and
conditions of the units.
10.
Performance Shares . The Committee shall designate the
participants to whom long-term performance stock
(“Performance Shares”) is to be awarded and determine
the number of shares, the length of the performance period and the
other terms and conditions of each such
award; provided
the stated performance period will not be less than 12 months.
Each award of Performance Shares shall entitle the participant to a
payment in the form of shares of common stock upon the attainment
of performance goals and other terms and conditions specified by
the Committee.
Notwithstanding
satisfaction of any performance goals, the number of shares issued
under a Performance Shares award may be adjusted by the Committee
on the basis of such further consideration as the Committee in its
sole discretion shall determine. However, the Committee may not, in
any event, increase the number of shares earned upon satisfaction
of any performance goal by any participant who is a Covered
Employee (as defined in section 2 above). The Committee may, in its
discretion, make a cash payment equal to the fair market value of
shares of common stock otherwise required to be issued to a
participant pursuant to a Performance Share award.
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