3. Other Financial Data

Statement of Operations Information

Other Charges

Other charges included in Operating earnings consist of the following:


Years Ended December 31	*2011*			2010			2009
Other charges (income):
Intangibles amortization	$	200		$	203		$	218
Reorganization of businesses		52			54			88
IP settlements and reserve adjustment		—			(78	)		—
Legal and related insurance matters, net		88			(29	)		(75	)
Environmental reserve charge		—			—			24
Pension plan adjustments, net		(9	)		—			—
Long-term financing receivable reserve		10			—			—

	$	341		$	150		$	255

During 2011, the Company recorded $88 million of net charges for legal matters. These charges primarily relate to the Silverman litigation and legal matters related to the legacy paging business.

During 2010, the Company entered into a settlement agreement with another company to resolve certain intellectual property disputes between the two companies. As a result of the settlement agreement, the Company received $65 million in cash and was assigned certain patent properties. As a result of this agreement, the Company recorded a pre-tax gain of $39 million (and $55 million was recorded in discontinued operations) during the year ended December 31, 2010, related to the settlement of the outstanding litigation between the parties.

Other Income (Expense)

Interest income, net, and Other both included in Other income (expense) consist of the following:


Years Ended December 31	*2011*			2010			2009
Interest expense, net:
Interest expense	$	(132	)	$	(217	)	$	(207	)
Interest income		58			88			74

	$	(74	)	$	(129	)	$	(133	)

Other:
Investment impairments	$	(4	)	$	(21	)	$	(75	)
Gain (loss) from the extinguishment of the Company's outstanding long-term debt		(81	)		(12	)		67
Foreign currency gain		8			12			14
Gain on Sigma Fund investments		—			11			80
Other		8			3			5

	$	(69	)	$	(7	)	$	91

Earnings (Loss) Per Common Share

Basic and diluted earnings (loss) per common share from both continuing operations and net earnings (loss) attributable to Motorola Solutions, Inc., including discontinued operations, is computed as follows:


	Continuing Operations						Net Earnings (loss) attributable to Motorola Solutions, Inc.
Years Ended December 31	*2011*		2010		2009		*2011*		2010		2009
Basic earnings (loss) per common share:
Earnings (loss)	$	747	$	244	$	422	$	1,158	$	633	$	(51	)
Weighted average common shares outstanding		333.8		333.3		327.9		333.8		333.3		327.9

Per share amount	$	2.24	$	0.73	$	1.29	$	3.47	$	1.90	$	(0.16	)

Diluted earnings (loss) per common share:
Earnings (loss)	$	747	$	244	$	422	$	1,158	$	633	$	(51	)

Weighted average common shares outstanding		333.8		333.3		327.9		333.8		333.3		327.9
Add effect of dilutive securities: Share-based awards and other		5.9		4.8		2.0		5.9		4.8		2.0

Diluted weighted average common shares outstanding		339.7		338.1		329.9		339.7		338.1		329.9

Per share amount	$	2.20	$	0.72	$	1.28	$	3.41	$	1.87	$	(0.15	)

Presentation gives effect to the Reverse Stock Split, which occurred on January 4, 2011.

In the computation of diluted earnings per common share from both continuing operations and on a net earnings basis for the year ended December 31, 2011, the assumed exercise of 8.6 million stock options and vesting of 0.2 million restricted stock units were excluded because their inclusion would have been antidilutive. For the year ended December 31, 2010, the assumed exercise of 14.6 million stock options and vesting of 0.7 million restricted stock units were excluded because their inclusion would have been antidilutive. For the year ended December 31, 2009, the assumed exercise of 22.7 million stock options and vesting of 2.2 million restricted stock units were excluded because their inclusion would have been antidilutive.

Balance Sheet Information

Sigma Fund

Sigma Fund consists of the following:


	*December 31, 2011*				December 31, 2010
Fair Value	*Current*		*Non-current*		Current		Non-current
Cash	$	264	$	—	$	2,355	$	—
Securities:
U.S. government, agency and government-sponsored enterprise obligations		2,944		—		2,291		—
Corporate bonds		—		—		—		58
Asset-backed securities		—		—		—		1
Mortgage-backed securities		—		—		—		11

	$	3,208	$	—	$	4,646	$	70

Securities with a significant temporary unrealized loss and a maturity greater than 12 months and defaulted securities have been classified as non-current in the Company's consolidated balance sheets. At December 31, 2011, no Sigma Fund investments were classified as non-current. At December 31, 2010, $70 million of the Sigma Fund investments were classified as non-current, and the weighted average maturity of the Sigma Fund investments classified as non-current (excluding defaulted securities) was 164 months. During 2011, the Company received $3 million of principal payments from non-current securities and sold the balance of the remaining securities for $67 million.

Investments

Investments consist of the following:


	Recorded Value				Less
December 31, 2011	Short-term Investments		Investments		Unrealized Gains		Unrealized Losses			Cost Basis
Available-for-sale securities:
U.S. government, agency and government-sponsored enterprise obligations		—		16		—		—			16
Corporate bonds		2		10		—		—			12
Mortgage-backed securities		—		2		—		—			2
Common stock and equivalents		—		11		2		(1	)		10

		2		39		2		(1	)		40
Other securities, at cost		—		106		—		—			106
Equity method investments		—		21		—		—			21

	$	2	$	166	$	2	$	(1	)	$	167


	Recorded Value				Less
December 31, 2010	Short-term Investments		Investments		Unrealized Gains		Unrealized Losses		Cost Basis
Certificates of deposit	$	7	$	—	$	—	$	—	$	7
Available-for-sale securities:
U.S. government, agency and government-sponsored enterprise obligations		—		17		—		—		17
Corporate bonds		2		11		—		—		13
Mortgage-backed securities		—		3		—		—		3
Common stock and equivalents		—		12		4		—		8

		9		43		4		—		48
Other securities, at cost		—		113		—		—		113
Equity method investments		—		16		—		—		16

	$	9	$	172	$	4	$	—	$	177

During the years ended December 31, 2011, 2010 and 2009, the Company recorded investment impairment charges of $4 million, $21 million and $75 million, respectively, representing other-than-temporary declines in the value of the Company's available-for-sale investment portfolio. Investment impairment charges are included in Other within Other income (expense) in the Company's consolidated statements of operations.

Gains on sales of investments and businesses, consists of the following:


Years Ended December 31	*2011*		2010		2009
Gains on sales of investments, net	$	17	$	49	$	91
Gains on sales of businesses, net		6		—		17

	$	23	$	49	$	108

During the year ended December 31, 2011, the $23 million of net gains primarily relate to sales of certain of the Company's equity investments. During the year ended December 31, 2010, the $49 million of net gains primarily related to sales of a number of the Company's equity investments, of which $31 million of gain was attributable to a single investment. During the year ended December 31, 2009, the $108 million of net gains primarily relates to: (i) sales of certain of the Company's equity investments, of which $32 million of gain was attributable to a single investment, and (ii) a net gain on the sales of specific businesses.

Accounts Receivable, Net

Accounts receivable, net, consist of the following:


December 31	*2011*			2010
Accounts receivable	$	1,911		$	1,596
Less allowance for doubtful accounts		(45	)		(49	)

	$	1,866		$	1,547

Inventories, Net

Inventories, net, consist of the following:


December 31	*2011*			2010
Finished goods	$	398		$	386
Work-in-process and production materials		284			292

		682			678
Less inventory reserves		(170	)		(157	)

	$	512		$	521

Other Current Assets

Other current assets consist of the following:


December 31	*2011*		2010
Costs and earnings in excess of billings	$	302	$	291
Contract-related deferred costs		142		160
Tax-related refunds receivable		85		116
Other		147		181

	$	676	$	748

Property, Plant and Equipment, Net

Property, plant and equipment, net, consist of the following:


December 31	*2011*			2010
Land	$	69		$	71
Building		774			804
Machinery and equipment		2,052			2,094

		2,895			2,969
Less accumulated depreciation		(1,999	)		(2,047	)

	$	896		$	922

Depreciation expense for the years ended December 31, 2011, 2010 and 2009 was $165 million, $150 million and $170 million, respectively.

Other Assets

Other assets consist of the following:


December 31	*2011*		2010
Intangible assets, net of accumulated amortization of $1,114 and $947	$	48	$	246
Long-term receivables, net of allowances of $10 and $1		37		251
Other		209		237

	$	294	$	734

Accrued Liabilities

Accrued liabilities consist of the following:


December 31	*2011*		2010
Deferred revenue	$	774	$	746
Compensation		471		558
Billings in excess of costs and earnings		250		226
Tax liabilities		126		179
Customer reserves		125		117
Networks purchase price adjustment		96		—
Distribution related obligation		75		—
Dividend payable		70		—
Other		734		748

	$	2,721	$	2,574

Other Liabilities

Other liabilities consist of the following:


December 31	*2011*		2010
Defined benefit plans, including split dollar life insurance policies	$	2,675	$	2,113
Postretirement health care benefits plan		295		277
Deferred revenue		275		272
Unrecognized tax benefits		112		70
Other		353		313

	$	3,710	$	3,045

Stockholders' Equity Information

Share Repurchase Program: On July 28, 2011, the Company announced that its Board of Directors approved a share repurchase program that allows the Company to purchase up to $2.0 billion of its outstanding common stock through December 31, 2012. On January 30, 2012, the Company announced that its Board of Directors authorized up to $1.0 billion in additional funds for use under the existing share repurchase program through the end of 2012.

During the year ended December 31, 2011, the Company repurchased 26.6 million of its common shares at an aggregate cost of $1.1 billion, or an average cost of $41.77 per share. All repurchased shares have been retired. During the years ended December 31, 2010 and 2009, the Company did not repurchase any of its common shares.

Payment of Dividends: During the year ended December 31, 2011, the Company announced that its Board of Directors approved the initiation of a regular quarterly cash dividend on the Company's outstanding common stock. The Company paid $72 million in cash dividends to holders of its common stock in 2011. During the year ended December 31, 2010, the Company did not pay cash dividends to holders of its common stock. During the year ended December 31, 2009, the Company paid $114 million in cash dividends to holders of its common stock, all of which was paid during the first quarter of 2009, related to the payment of a dividend declared in November 2008. In February 2009, the Company announced that its Board of Directors suspended the declaration of quarterly cash dividends on the Company's common stock.

During the years ended December 31, 2011, 2010, and 2009, the Company paid $8 million, $23 million, and $3 million, respectively, in dividends to minority shareholders in connection with subsidiary common stock.

Par Value Change: On May 4, 2009, the Company's stockholders approved a change in the par value of Motorola Solutions common stock from $3.00 per share to $.01 per share. The change did not have an impact on the amount of the Company's total stockholders' equity, but it did result in a reclassification of $6.9 billion between Common stock and Additional paid-in capital.

Motorola Mobility Distribution: On January 4, 2011, the Distribution of Motorola Mobility from Motorola Solutions was completed. On January 4, 2011, the stockholders of record as of the close of business on December 21, 2010 received one (1) share of Motorola Mobility common stock for each eight (8) shares of Motorola, Inc. common stock held.

As a result of the Distribution on January 4, 2011, certain equity balances were transferred by the Company to Motorola Mobility including: (i) $1 million in Foreign currency translation adjustments, (ii) $9 million in Fair value adjustments to available for sale securities, net of tax of $5 million, and (iii) $8 million in Retirement benefit adjustments, net of tax of $4 million. The distribution of net assets and these equity balances were effected by way of a pro rata dividend to Motorola Solutions stockholders, which reduced Retained earnings and Additional paid in capital by $5.3 billion.

Reverse Stock Split: On November 30, 2010, the Company announced the timing and details regarding the Separation and the approval of a reverse stock split at a ratio of 1-for-7. Immediately following the Distribution of Motorola Mobility common stock, the Company completed a 1-for-7 reverse stock split. All consolidated per share information presented gives effect to the Reverse Stock Split.