DEF 14A 1 d299701ddef14a.htm DEF 14A DEF 14A
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

Filed by the Registrant  ☒                            Filed by a Party other than the Registrant  ☐

Check the appropriate box:

 

  Preliminary Proxy Statement
  Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
  Definitive Proxy Statement
  Definitive Additional Materials
  Soliciting Material under §240.14a-12

Motorola Solutions, Inc.

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check all boxes that apply):

  No fee required
  Fee paid previously with preliminary materials
  Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11

 

 

 

 


Table of Contents

                    

 

 

 

 

 

 

 

 

 

Notice of

 

2022 ANNUAL MEETING

 

of Shareholders and Proxy Statement

 

 

LOGO

 


Table of Contents

LOGO

Dear Fellow Motorola Solutions Shareholder:

In February 2021, a good Samaritan called 911 and, in a couple of clicks, was streaming live video of a car driving recklessly, allowing first responders to “be in the car with her” with an exact location to coordinate a safe response – and ultimately arrest the driver. This was possible because Okaloosa County, Florida uses Motorola Solutions’ CommandCentral Citizen Input, an application enabling public safety agencies to work in partnership with citizens to help keep us all safe.

This is just one example of the mission-critical technology Motorola Solutions innovates every day – capabilities that often go unnoticed but deliver tangible results in the real world, in the moments that matter most. On behalf of Motorola Solutions, its board of directors and employees, we thank you for your investment in our company. Your support enables us to continue driving innovation and delivering on our commitment to advance the technologies that help to create a safer world.

As we look back at 2021 – another year of unprecedented and overall challenging moments, including record natural disasters, supply chain disruptions, inflation and COVID-19 variants – we are incredibly proud of what Motorola Solutions accomplished. Throughout the year, we focused on:

 

   

Prioritizing the safety and welfare of our people and those we serve.

 

   

Continuing to invest in human capital through recruiting, training and diversity initiatives designed to support a thriving and inclusive global workforce that reflects a range of perspectives, skills and experiences.

 

   

Operating exceptionally well and delivering the solutions relied on by thousands of public safety agencies and enterprise customers – and millions of people around the world.

 

   

Strengthening our critical technologies – Land Mobile Radio Communications, Video Security and Access Control and Command Center Software – that create an integrated ecosystem for public safety and enterprise security.

 

   

Setting a new goal of reducing Scope 1 and Scope 2 greenhouse gas emissions by 95% by 2031, after reaching our 2022 goal of reducing Scope 1 and Scope 2 greenhouse gas emissions by 38% in 2020.

 

   

Maintaining our disciplined and strategic approach to capital allocation, with a focus on investing for the long term and delivering superior value to shareholders, resulting in total shareholder return of 62%, compared to the S&P 500’s total shareholder return of 29%.

Our approximately 18,700 employees around the world continue to be the driving force behind our momentum and success. They are passionate about our purpose to “help people be their best in the moments that matter,” and their support for our customers, communities and each other is unwavering.

Motorola Solutions is resilient and well-positioned to continue growing and delivering strong returns. In 2021 we achieved record sales, earnings and operating cash flow, ended the year with a record $13.6 billion backlog position and increased our total addressable market to $47 billion.

Our accomplishments and performance in 2021 again demonstrate that by operating responsibly, supporting our employees and communities and investing in the future, we can continue to deliver best-in-class solutions for our customers and create value for our shareholders.

Thank you for your continued support.

 

LOGO

Gregory Q. Brown

Chairman and CEO


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LOGO

 

PRINCIPAL EXECUTIVE OFFICES:

500 West Monroe Street

Chicago, Illinois 60661

March 31, 2022

NOTICE OF 2022 VIRTUAL ANNUAL MEETING OF SHAREHOLDERS

Annual Meeting Date: Tuesday, May 17, 2022

Time: 9:30 a.m. Central Time

Virtual Meeting Site: www.virtualshareholdermeeting.com/MSI2022

This year’s virtual annual meeting (the “Annual Meeting”) will be held entirely online via live audio webcast. The Annual Meeting will begin promptly at 9:30 a.m. Central Time. For more information regarding how to attend the Annual Meeting online, please see the section titled “User’s Guide” on page 95 of this Proxy Statement. Shareholders will be able to listen, vote, and submit questions from their home or from any remote location that has internet connectivity. There will be no physical location for shareholders to attend. Shareholders may only attend, vote, and submit questions during the Annual Meeting by logging in at www.virtualshareholdermeeting.com/MSI2022 and entering the 16-digit control number included in their Notice of Internet Availability of Proxy Materials (the “Notice”), voting instruction form, or proxy card.

The purpose of the meeting is to:

1.

elect the eight director nominees named in this Proxy Statement for a one-year term;

2.

ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2022;

3.

hold a shareholder advisory vote to approve the Company’s executive compensation;

4.

approve the Motorola Solutions Amended and Restated Omnibus Incentive Plan of 2015; and

5.

act upon such other matters as may properly come before the Annual Meeting.

Only Motorola Solutions shareholders of record at the close of business on March 18, 2022 (the “record date”) will be entitled to notice of, and to vote at, the meeting or any adjournment or postponement thereof. The Notice, which contains instructions regarding how to access this Proxy Statement, the proxy card and the Company’s 2021 Annual Report, is first being mailed to shareholders on or about March 31, 2022. In addition, this Proxy Statement, the proxy card and the Company’s 2021 Annual Report are available at www.ProxyVote.com.

If you are a “street name” shareholder (meaning that your shares are registered in the name of your broker, bank or other nominee), you will receive instructions from such bank, broker or other nominee describing how to vote your shares.

By order of the Board of Directors,

 

LOGO

Kristin L. Kruska

Secretary

 

 

  REVIEW YOUR PROXY STATEMENT AND VOTE IN ONE OF FOUR WAYS:

 

   

   LOGO

 

 

 

VIA THE INTERNET

 

 

 

LOGO

 

 

 

BY MAIL

 

 
  Visit the website shown on your Notice or proxy card to vote via the internet.  

If you received a printed copy of the proxy card, mark, sign, date and return the proxy card using the postage-paid envelope provided.

 

 

     LOGO

 

 

 

BY TELEPHONE

 

 

    LOGO

 

 

 

AT THE VIRTUAL ANNUAL MEETING

 

   
 

Use the toll-free telephone number listed on your proxy card.

 

 

Via the internet at the virtual Annual Meeting at www.virtualshareholdermeeting.com/MSI2022

 

 

THIS MEETING WILL TAKE PLACE ONLINE ONLY. THERE IS NO PHYSICAL LOCATION. In order to attend the meeting as a shareholder, you will need the 16-digit control number included on your Notice, proxy card or voting instruction form.

 

     


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TABLE OF CONTENTS

 

 

    

PROXY STATEMENT

 

PROXY STATEMENT SUMMARY

    1  

MOTOROLA SOLUTIONS’ ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) PROGRAM

    6  

OUR BOARD

    12  

PROPOSAL NO.  1 — ELECTION OF DIRECTORS NAMED IN THIS PROXY STATEMENT FOR A ONE-YEAR TERM

    12  

WHO WE ARE – BOARD

    12  

OUR BOARD’S QUALIFICATIONS

    17  

HOW OUR BOARD IS SELECTED AND ASSESSED

    17  

HOW OUR BOARD GOVERNS THE COMPANY

    20  

OUR BOARD’S LEADERSHIP STRUCTURE

    24  

COMMITTEES OF THE BOARD

    25  

INDEPENDENCE

    27  

RELATED PERSON TRANSACTION POLICY AND PROCEDURES

    27  

HOW YOU CAN COMMUNICATE WITH OUR BOARD

    28  

HOW WE DETERMINE DIRECTOR COMPENSATION

    28  

HOW OUR DIRECTORS ARE COMPENSATED

    29  

OUR COMPANY

    32  

WHO WE ARE

    32  

OUR LEADERSHIP TEAM

    33  
PROPOSAL NO. 2 — RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2022     35  
OUR PAY     36  
PROPOSAL NO. 3 — ADVISORY APPROVAL OF THE COMPANY’S EXECUTIVE COMPENSATION     36  
COMPENSATION DISCUSSION AND ANALYSIS     37  

SAY ON PAY VOTE RESULTS AND SHAREHOLDER ENGAGEMENT

    38  

EXECUTIVE SUMMARY

    39  

PROCESS FOR DETERMINING EXECUTIVE COMPENSATION

    49  

2021 ANNUAL COMPENSATION ELEMENTS

    54  

COMPARATIVE MARKET DATA

    56  

EQUITY USAGE UNDER OUR COMPENSATION PROGRAMS

    57  

OTHER COMPENSATION POLICIES AND PRACTICES

    58  

COMPENSATION AND LEADERSHIP COMMITTEE REPORT

    61  

COMPENSATION AND LEADERSHIP COMMITTEE INTERLOCKS AND  INSIDER PARTICIPATION

    61  

NAMED EXECUTIVE OFFICER COMPENSATION

    62  

2021 SUMMARY COMPENSATION TABLE

    62  

GRANTS OF PLAN-BASED AWARDS IN 2021

    65  

OUTSTANDING EQUITY AWARDS AT 2021 FISCAL YEAR-END

    67  

OPTION EXERCISES AND STOCK VESTED IN 2021

    69  

NONQUALIFIED DEFERRED COMPENSATION IN 2021

    69  

RETIREMENT PLANS

    70  

PENSION BENEFITS IN 2021

    71  

EMPLOYMENT CONTRACTS

    71  

TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL ARRANGEMENTS

    72  

CEO PAY RATIO

    80  

EQUITY COMPENSATION PLAN INFORMATION

    81  

PROPOSAL NO.  4 — APPROVAL OF THE MOTOROLA SOLUTIONS AMENDED AND RESTATED OMNIBUS INCENTIVE PLAN OF 2015

    82  

AUDIT COMMITTEE MATTERS

    89  

REPORT OF AUDIT COMMITTEE

    89  

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FEES

    91  

AUDIT COMMITTEE PRE-APPROVAL POLICIES

    91  

OUR SHAREHOLDERS

    92  

SECURITY OWNERSHIP INFORMATION

    92  

USER’S GUIDE

    95  

VIRTUAL ANNUAL MEETING PHILOSOPHY

    95  

INSTRUCTIONS FOR VIRTUAL ANNUAL MEETING

    95  

VOTING MATTERS

    96  

IMPORTANT DATES FOR THE 2023 ANNUAL MEETING

    99  

OTHER MATTERS

    101  

APPENDIX A — MOTOROLA SOLUTIONS AMENDED AND RESTATED OMNIBUS INCENTIVE PLAN OF 2015

    A-1  

 

     


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LOGO

 

 

PROXY STATEMENT SUMMARY

This proxy statement (the “Proxy Statement”) is being furnished to holders of common stock, $0.01 par value per share (the “Common Stock”) of Motorola Solutions, Inc. (“we,” “our,” “Motorola Solutions,” “MSI” or the “Company”). Proxies are being solicited on behalf of the Board of Directors of the Company (the “Board”) to be used at the 2022 Annual Meeting of Shareholders (the “Annual Meeting”) to be held virtually at www.virtualshareholdermeeting.com/MSI2022 on Tuesday, May 17, 2022 at 9:30 a.m. Central Time, for the purposes set forth in the Notice of 2022 Virtual Annual Meeting of Shareholders. This Proxy Statement is dated March 31, 2022 and is being distributed to shareholders on or about March 31, 2022.

WHAT IS MOTOROLA SOLUTIONS?

Motorola Solutions is a global leader in public safety and enterprise security. Our technologies in Land Mobile Radio Communications (“LMR” or “LMR Communications”), Video Security and Access Control and Command Center Software, bolstered by managed and support services, create an integrated technology ecosystem to help make communities safer and businesses stay productive and secure. We serve more than 100,000 public safety and commercial customers in over 100 countries, providing “purpose-built” solutions designed for their unique needs. Headquartered in Chicago, we have a rich heritage of innovation dating back to 1928 that our approximately 18,700 employees continue today.

PERFORMANCE AND ACCOMPLISHMENTS

TOTAL SHAREHOLDER RETURN (in percent)

 

LOGO

PERFORMANCE HIGHLIGHTS SINCE 2011

 

 

  792.5%

  TOTAL  

  SHAREHOLDER  

RETURN*

 

   

 

  51%

REDUCTION

IN SHARE

COUNT

 

   

 

$17.3

BILLION

 IN CAPITAL

RETURN 

 

 

*

Based on the split adjusted closing price of MSI common stock on December 31, 2010 and the closing price of MSI common stock on December 31, 2021, illustrating the growth of an initial investment of $100 on December 31, 2010, including payment of dividends.

 

Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement   1


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     2021 HIGHLIGHTS

 

   

 

  Grew sales 10% to record $8.2 billion

 

  Grew Software and Services sales by 13%

 

  Grew backlog 19% compared to 2020, to record $13.6 billion

 

  Increased quarterly dividend 11% to $0.79 per share

 

  Capital allocation of cash included $528 million of share repurchases, $482 million of dividends, and $457 million for acquisitions

 

  Generated $1.8 billion of operating cash flow

 

  Issued $850 million of new long-term debt and redeemed $324 million of outstanding debt

 

  

 

  Announced $2 billion increase to share repurchase program

 

  Acquired Openpath Security Inc., a provider of cloud-based mobile access control

 

  Acquired Envysion, Inc., a leader in enterprise security and business analytics

 

  Acquired 911 Datamaster, Inc., a provider of Next Generation 911 data solutions

  

 

   Employees volunteered a record of approximately 65,000 hours during the year

 

  The Motorola Solutions Foundation donated more than $12 million to charitable organizations

 

  Ranked No. 5 in Fortune World’s Most Admired Companies List for Network and Other Communications Equipment (fourth consecutive year in Top 5)

 

  Named No. 15 on Investor’s Business Daily’s Top 100 ESG Stocks

 

 

  2022 ANNUAL MEETING OF SHAREHOLDERS

 

     

Date and Time: Tuesday, May 17, 2022, 9:30 a.m. Central Time

 

     

Virtual Meeting Site: www.virtualshareholdermeeting.com/MSI2022

 

     

Record Date: March 18, 2022

 

     

Voting: Shareholders as of the close of business on the record date are entitled to vote. Each share of common stock is entitled               to one                vote for each director nominee and one vote for each of the other proposals to be voted on.

 

     

Online meeting only: No physical location

 

 
  Items to be Voted On       Our Board’s Recommendation    
 

  Election of the Eight Director Nominees Named in this Proxy Statement for a One-Year Term (page 12)

 

FOR

 

  Ratification of the Appointment of PricewaterhouseCoopers LLP as the Company’s Independent Registered Public Accounting Firm for 2022 (page 35)

 

FOR

 

  Advisory Approval of the Company’s Executive Compensation (page 36)

 

FOR

 

  Approval of the Motorola Solutions Amended and Restated Omnibus Incentive Plan of 2015 (page 82) 

 

FOR

 

2   Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement


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DIRECTOR NOMINEE HIGHLIGHTS (page 12)

 

      

Board Committees

(as of March 31, 2022)

               
 Name  

Director  

Since  

  Indep.    

Other

Public Co.  

Boards

  Position     Audit       Comp.    

  Gov. &  

Nom.

    Exec.  
               

 Gregory Q. Brown

  2007             0    

 

Chairman and CEO,

Motorola Solutions, Inc.

 

             

LOGO

               

 Kenneth D. Denman

  2017    

 

LOGO

 

  2    

 

General Partner,

Sway Ventures

 

     

LOGO

 

LOGO

 

LOGO

               

 Egon P. Durban

  2015    

 

LOGO

 

  6     Co-CEO of Silver Lake      

LOGO

       
               

 Ayanna M. Howard

  2022    

 

LOGO

 

  1    

 

Dean of the College of Engineering at The Ohio State University

 

 

LOGO

           
               

 Clayton M. Jones

  2015    

 

LOGO

 

  1    

 

Former Chairman, CEO and President, Rockwell Collins, Inc.

 

 

LOGO

           
               

 Judy C. Lewent

  2011    

 

LOGO

 

  0    

 

Former EVP and CFO,

Merck & Co., Inc.

 

 

LOGO

         

LOGO

               

 Gregory K. Mondre

  2015    

 

LOGO

 

  1     Co-CEO of Silver Lake          

 

LOGO

   
               

 Joseph M. Tucci

  2017    

 

LOGO

 

  2    

 

Chairman of Bridge Growth Partners and Lead Director GTY Technology Holdings, Inc.

 

     

LOGO

 

LOGO

 

LOGO

LOGO  = Chair of Committee

 

LOGO

 

Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement   3


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DIVERSITY OF SKILLS AND EXPERIENCE

 

                 
 

 

Gregory Q.  

Brown  

Kenneth D.  
Denman  

Egon P.  

Durban  

Ayanna M.  

Howard  

Clayton M.  

Jones  

Judy C.  

Lewent  

Gregory K.  
Mondre  
Joseph M.  
Tucci  
                 

Independence

                 

Gender and/or racial diversity

                 

Relevant industry experience

                 

Public Company CEO, division CEO or CFO

                 

Financial and accounting expertise

                 

Technology expertise

                 

Cybersecurity, safety and security experience

                 

Software and services business experience

                 

Global business experience

                 

Developing markets experience

                 

Government, public policy, regulatory experience

                 

Private equity, investment banking or capital allocation experience

                 

Public company board experience

DIRECTOR NOMINEES STATISTICS

 

 

Independence

88%

 

 

 

Average Tenure  

6 Years  

 

 

 

Gender and/or Racial Diversity 

38%

 

 

 

Average Age  

61 Years 

 

 

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GOVERNANCE HIGHLIGHTS (page 17)

 

     

Proxy access provision in our amended and restated bylaws (our “Bylaws”)

 

     

Broad-reaching environmental, social and governance (“ESG”) program with Governance and Nominating Committee oversight of ESG matters as well as Audit Committee oversight of ESG-related risks

 

     

7 of our 8 directors are independent, including all committee members

 

     

Lead Independent Director

 

     

Regular executive session meetings of independent directors

 

     

Annual election of directors

 

     

Annual director self-assessment process

 

     

No supermajority voting provisions in our organizational documents

 

     

No “poison pill”

 

     

Robust oversight of risk

 

     

Director Independence Guidelines

 

     

Majority voting standard in uncontested director elections

 

     

20% threshold for shareholder right to call special meeting

 

     

Shareholder right to act by written consent

 

     

Succession planning

 

     

Proactive shareholder engagement

EXECUTIVE COMPENSATION PROGRAM HIGHLIGHTS (page 37)

 

     

Pay-for-performance and at-risk compensation

 

     

A significant portion of our targeted annual compensation is performance-based and/or subject to forfeiture (“at-risk”), with emphasis on variable pay to reward short- and long-term performance measured against pre-established objectives informed by the Company’s strategy. For 2021, performance-based compensation comprised approximately 93% of the targeted annual compensation for our CEO and, on average, approximately 83% of the targeted annual compensation for our other NEOs.

 

     

Compensation aligned with shareholder interests

 

     

Performance measures for incentive compensation are linked to the overall performance of the Company and are designed to be aligned with the creation of long-term shareholder value.

 

     

Emphasis on future pay opportunity vs. current pay

 

     

Our long-term incentive awards are equity-based, use multi-year vesting provisions to encourage retention, and are designed to align our NEOs’ interests with long-term shareholder interests. For 2021, long-term equity compensation comprised approximately 81% of the targeted annual compensation for our CEO and, on average, approximately 66% of the targeted annual compensation for the other NEOs.

 

     

Retention of independent compensation consultant

 

     

Annual “say on pay” vote

 

     

No excise tax gross-up provisions

 

     

A recoupment “clawback” policy for compensation paid to certain officers

 

     

Robust stock ownership guidelines for directors and officers

 

     

An anti-hedging policy

 

     

“Double trigger” severance benefits in the event of a change in control

 

     

No repricing of options without shareholder approval

 

     

No excessive perquisites

 

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MOTOROLA SOLUTIONS’ ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) PROGRAM

Our Vice President, Legal and ESG, works closely with the Executive Management ESG Governance Team (which is led by two members of our Executive Committee) to develop and implement our ESG-related strategies and programs across our global organization. In addition, our strategies and programs are influenced by the voices of our valued shareholders, the communities in which we serve, and inputs collected from numerous stakeholders. Our ESG program is comprised of six pillars:

 

 

 

LOGO

 

 

6   Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement


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The following table describes our 2021 ESG highlights, organized across our six pillars:

 

LOGO

 

Our Business

  

  We focused on partner employee diversity. We sent a survey to channel partners to understand the different diverse groups within their workplaces. We followed up with recruiting resources and training to leverage LinkedIn and other platforms to attract and hire more diverse talent.

 

  We expanded the scope and reach of our information security and privacy certifications and reporting activity. We achieved ISO 27001 certification, an international standard on information security management, for our information security management practices. We also achieved SOC2 Type II reporting, an internal controls reporting system concerning company safeguards of customer data, for security and privacy practices across 12 sites for our Command Center Software operation. Key development and support sites achieved certification to ISO 27017 (information security for cloud services) and ISO 27018 (protection of personally identifiable information in public clouds). As of the date of this Proxy Statement, certification to ISO 27001, 27017, 27018 and 27701 (privacy management system), as well as SOC2 Type II reporting, is in process across an additional 19 sites around the world encompassing our Video Security and Access Control and critical communications operations, with achievement dates anticipated throughout 2022.

 

  Our technology policy group, the Motorola Solutions Technology Advisory Committee (“MTAC”), published additional guidelines for positioning and selling sensitive technologies as well as responsible, transparent disclosure of product capabilities. The MTAC partnered with the Office of Ethics and Compliance and our international sales leadership to establish controls in our sales processes that aim to identify and ensure objective review of prospective transactions that contain sensitive technologies to customers and/or countries where misuse and/or abuse of the products may be of concern.

 

 

Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement   7


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LOGO

 

Community Engagement

  

  The Motorola Solutions Foundation (the “Foundation”), which has donated $100 million over the past 10 years to organizations supporting students, teachers, first responders, veterans and community members, once again allocated the majority of its 2021 grant funding to programs that directly support people of color.

 

  The Foundation granted more than $12 million to more than 1,000 charitable organizations around the world. Of this, $9.6 million was awarded to nearly 170 nonprofits in 25 countries through the Foundation’s strategic grants program, which prioritizes first responder programs and technology and engineering education. The Foundation’s funding toward mental health for first responders increased by 85% (compared to 2020), acknowledging the critical role that it plays in first responders’ ability to support their communities. Through initiatives that promote wellness and stress management training, scholarships to families of fallen first responders and more, the Foundation works to directly impact the availability of resources to first responders and their families. The Foundation’s support for technology and engineering education was also significant. In partnership with organizations that engage students through hands-on engineering activities like design, coding, and robotics, the Foundation continued its commitment to making these programs more accessible for everyone, awarding over $1 million in educational scholarships for individuals underrepresented in STEM. Further, 60% of funding in this area directly supported women, and 78% directly benefited people of color.

 

  Despite the pandemic, Motorolans never wavered in finding meaningful ways to give back. Employees in more than 40 countries logged nearly 65,000 volunteer hours—more than a 60% increase compared to 2020. The majority of those hours was logged during the Foundation-sponsored Global Months of Service, our annual volunteer-a-thon in September and October. Global Months of Service resulted in $230,000 in donations to nonprofits, many of which serve diverse and underrepresented populations.

 

  The increase in volunteerism during Global Months of Service also helped fuel a 40% increase compared to 2020 in the number of employees entering a volunteer grant request under the Foundation’s “Donations for Doers” program.

 

  Employees requested nearly $800,000 in matching gifts for charitable donations through the Foundation’s “Donations for Donors” program, supporting nearly 950 causes.

 

  On Giving Tuesday alone, many of our employees took advantage of the Foundation’s special 2:1 match incentive for gifts to select organizations focused on hunger relief, while others gave back to causes they were passionate about. Their generosity resulted in over $100,000 in Foundation gift matching.

 

  We partnered with our Chief Technology Office User Experience team on an initiative called Homebase—a project that will allow people experiencing homelessness or housing instability to connect directly with the services they need, and assist first responders when directing people in this situation to an appropriate resource. We assist and empower those experiencing homelessness or housing instability by:

 

   Providing time management / scheduling tools

 

   Providing easy access to food, shelter, and other services and resources

 

   Providing a way to organize and track their daily goals and activities

 

8   Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement


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LOGO

 

Human Capital Management

  

  We introduced “Inclusive” as a company value.

 

  We implemented enhancements to our employee performance management program that are better aligned with our company values and ensure that employees and managers are focused on having more structured ongoing career and development conversations that are centered on those values.

 

  We launched a required diversity, equity and inclusion (“DEI”) training course for all employees, with a 94% completion rate as of the end of 2021.

 

  We published our first public-facing DEI website, which contains information on our DEI commitment, efforts and recognitions, as well as EEO-1 level workforce demographic data.1

 

  We provided U.S. employees the ability to self-identify the following attributes in our internal employee database: gender identity, sexual orientation and preferred pronouns.

 

  We developed and published our first enterprise-wide DEI strategic plan and DEI action plans for each Executive Committee organization, outlining clear objectives, goals, metrics and accountabilities.

 

  Our Veterans Business Council (“VBC”) worked closely with Cadet Command and Reserve Officers’ Training Corps (ROTC) programs to provide radio support for training exercises. As a result, 825 cadets were trained on our LMR radios. Throughout the year, the VBC supported 17 veteran initiatives that included 3,258 participants contributing 1,175 volunteer hours. Their direct efforts led to the hiring of five veterans.

 

  We sponsored 300 employees to attend the Society of Women Engineers (“SWE”) conference, the world’s largest conference for female engineers. The conference promoted professional development and connection with women at all levels, to learn from one another and grow as individuals to impact the industry in profound ways.

 

  In the midst of the COVID-19 pandemic, Motorola Solutions Malaysia worked closely with both the federal and state governments, government agencies like the Ministry of International Trade and Industry (MITI), Malaysian Investment Development Authority (MIDA) and Ministry of Health (MOH), as well as key industry leaders, to accelerate the administration of the COVID-19 vaccine for the Malaysian public. As part of Malaysia’s COVID-19 Public-Private Partnership (PIKAS) Immunisation Programme, Motorola Solutions Malaysia was one of the first companies in Malaysia to have its employees receive all recommended initial doses of the COVID-19 vaccine.

 

  Our Worldwide Education Organization delivered instructor-led training to 24,000 students located in over 100 countries. 112,000 students took online training from our eLearning catalog, a 52% increase from 2020.

 

  The Talent Acquisition team, in collaboration with the Multicultural Business Council and Women’s Business Council, helped grow our diversity pipeline through partnerships with several organizations, including SWE, the National Society of Black Engineers and the Society of Hispanic Professional Engineers.

 

 

1 

The information contained in on or accessible through our corporate website is not incorporated by reference into and is not a part of this Proxy Statement.

 

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LOGO

 

Environment

  

  We set a new goal of reducing Scope 1 and Scope 2 greenhouse gas emissions by 95% by 2031, after reaching our 2022 goal of reducing Scope 1 and Scope 2 greenhouse gas emissions by 38% in 2020.

 

  Our global locations decreased their aggregate total electricity consumption across 17 sites worldwide, creating savings of 3,242,560 kWh compared to 2020. These savings were achieved, in part, by an interior LED lighting retrofit at sites in California, a variable frequency drive project implemented in Illinois, and the installation of a cooling tower water economizer in Illinois. These projects contributed to the portfolio consumption reduction by creating savings compared to 2020 of 95,715 kWh, 362,500 kWh and 183,332 kWh, respectively.

 

  In our battery and accessory portfolio, we reduced the power consumption of our products by applying innovative technologies and solutions. For example, we reduced the power consumption of our wireless accessories by supporting Bluetooth LE (low energy). We reduced the power consumption of our battery chargers and shipped solutions that detect less efficient batteries for timely replacement.

 

  We developed and shipped high-density lithium polymer cells to reduce battery waste. We continue to invest in maturing our battery platform to further reduce the number of battery cells used in our products, in an effort to reduce battery waste overall. In our LMR infrastructure portfolio, we shipped a new product line that replaced legacy hardware with a software-based architecture, which reduced our power consumption for this product line.

 

  All energy solutions (such as chargers) in our LMR portfolio are compliant with low power consumption requirements for standby mode as directed by EU standards and California Energy Commission standards, exceeding current low power consumption requirements in most other parts of the world where our LMR products are sold.

LOGO

 

Supply Chain

  

  Our Environmental Health and Safety Team implemented a supplier development program to address human rights and supply chain responsibility improvement opportunities across our suppliers. This program includes comprehensive training and individualized consulting support for underperforming suppliers. Through this program, participating suppliers were able to effectively close recurring priority findings such as forced labor, policy management and recruitment fees, reducing overall risk in our supply chain.

 

  We updated our Supplier Code of Conduct to align with version 7.0 of the Responsible Business Alliance Code of Conduct, demonstrating our ongoing commitment to support the rights and well-being of workers and communities worldwide that are affected by the global supply chain.

 

  Our commitment to provide economic opportunities to diverse-owned suppliers remains steadfast. We aim to leverage supplier diversity organizations that are aligned with our goal to drive resilient, inclusive and competitive supply and we strive to partner with local, agile and diverse suppliers to drive competition and innovation.

 

  We launched corporate responsibility surveys to suppliers requesting that they confirm their adherence to our diversity and labor policies.

 

  We leveraged one of our larger internal purchasing platforms to drive purchases of more eco-friendly products including those that are of reduced product size and weight, leading to a reduction in carbon emissions.

 

  We further reduced levels of business travel by approximately 50% as compared to 2019 normal levels.

 

  We drove a 40% increase compared to 2020 in electric vehicle purchases for our leased fleet.

 

  We strengthened business continuity by gaining compliance to ISO 22301:2019, the industry standard for Business Continuity Planning (BCP), in Krakow, Penang, Chicago, Schaumburg and Singapore.

 

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LOGO

 

Governance and Compliance

  

  We are committed to responsible and effective corporate governance to enhance the creation of sustainable, long-term shareholder value and to remain accountable and responsive to our stakeholders.

 

  We strengthened our anti-corruption program through additional training for targeted higher-risk audiences using upgraded course materials and formats.

 

  We improved our third-party sales representative due diligence protocols.

 

  We broadened our use of risk-based analysis for the countries in which we do business.

 

  We engaged with employees through our 35 Business Conduct Champions, who represent a wide range of cultural, business function, and geographic diversity and serve as local resources to whom ethics concerns and questions can be addressed.

 

  We enhanced our Corporate Responsibility website by creating a new public-facing ESG website to assist users in learning more about our efforts in ESG and corporate responsibility.2

 

  The Executive Management ESG Governance Team met once per quarter in 2021, with each meeting attended by no less than 85% of its members.

 

  The Audit Committee and Governance and Nominating Committee of the Board were briefed on ESG matters regularly.

 

  Investor’s Business Daily named us as #15 in top ESG stocks.

 

  For more information on our robust corporate governance structure, see the section of this Proxy Statement titled “Proposal No. 1 – Election of Directors Named in this Proxy Statement for a One-Year Term” beginning on page 12.

 

 

LOGO

We anticipate that our 2021 corporate responsibility report will be available during the summer of 2022, and we expect to publish our first Task Force on Climate-Related Financial Disclosures (TCFD) report this year.2

 

 

2 

The information contained in on or accessible through our corporate website is not incorporated by reference into and is not a part of this Proxy Statement.

 

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OUR BOARD

 

 

 

 

PROPOSAL NO. 1 — ELECTION OF DIRECTORS NAMED IN THIS PROXY STATEMENT FOR A ONE-YEAR TERM

 

Proposal Number 1 of this Proxy Statement enables you to vote on the members of your Board.* We open the Proxy Statement with this proposal because we believe there is no more important vote than that of electing the fiduciaries who oversee Motorola Solutions on your behalf.

To inform that vote, we provide you information here on, among other topics:

 

     

Who our Board is – including their qualifications

 

     

How our Board is selected and assessed

 

     

How the Board governs the Company

 

     

How our Board is organized

 

     

How you can communicate with the Board

 

     

How our Board is compensated

WHO WE ARE – BOARD

The Board believes that each nominee has the skills, experience and personal qualities the Board seeks in its directors, and that the combination of these nominees creates an effective and well-functioning Board, with a diversity of perspectives, viewpoints, backgrounds and professional experiences that best serves the Board, the Company and our shareholders.

Each of the nominees named below is currently a director of the Company. Each of the director nominees (other than Dr. Howard) was elected at the Annual Meeting of Shareholders held on May 18, 2021. As previously announced, on January 16, 2022, the Board increased the number of directors of the Company from seven to eight, and elected Dr. Howard to serve as a director, with each action effective as of February 15, 2022. The ages shown are current as of the date of this Proxy Statement. Included in each nominee’s biography is a description of select key qualifications, experience and characteristics, including each nominee’s self-identified race, that led the Board to conclude that each nominee is qualified to serve as a member of the Board.

 

 

 GREGORY Q.

 BROWN

  

 

Mr. Brown joined the Company in 2003, was appointed as Chief Executive Officer of Motorola, Inc. in January 2008, and since May 2011 has been the Chairman and Chief Executive Officer of Motorola Solutions, Inc.

 

Other Public Company Boards: In the last five years, Mr. Brown served on the board of Xerox Corporation from January 2017 to May 2019.

 

Board Committees: Executive (Chair)

 

Director Qualifications:

 

  Public company CEO, relevant industry, technology, software and services business, and cybersecurity, safety and security experience as Chairman and CEO of the Company and former Chairman and CEO of Micromuse, Inc.

 

  Financial and accounting expertise, global business, capital allocation, developing markets, government, public policy, and regulatory experience as Chairman and CEO of the Company, former chair and board member of the Federal Reserve Bank of Chicago, former Vice Chair of the U.S. – China Business Council, and former member of the President of the United States’ Management Advisory Board

 

  Government, public policy, and regulatory experience as a member of the Business Roundtable and The Business Council, and former member of the President’s National Security Telecommunications Advisory Committee (NSTAC)

 

  Public company board experience

  LOGO  

 

 Principal Occupation:

 Chairman and Chief
 Executive Officer,
 Motorola Solutions, Inc.    

 

 Age: 61

 Race: White

 Director since: 2007

 Chairman since: 2011

    

    

    

 

* 

The number of directors of the Company to be elected at the Annual Meeting is eight. If elected by our shareholders at the Annual Meeting, each director nominee will serve a one-year term ending at the 2023 Annual Meeting of Shareholders. Each director will hold office until his or her respective successor is elected and qualified or until his or her earlier death or resignation. Each of the nominees has consented to being named in this Proxy Statement and to serve as a director if elected. However, if any nominee is not available to serve as a director for any reason at the time of the Annual Meeting, the proxies will be voted for the election of such other person or persons as the Board may designate, unless the Board, in its discretion, reduces the number of directors. The Board has the authority under our Bylaws to increase or decrease the size of the Board and to fill vacancies between Annual Meetings of Shareholders.

 

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 KENNETH D.

 DENMAN

  

 

Mr. Denman is a General Partner at Sway Ventures, a venture capital firm that invests in early to mid-stage technology companies. He was the CEO and President of Emotient, Inc., a company that uses artificial intelligence to analyze facial expressions to detect emotions, from 2012 to 2016. He also served as the Chief Executive Officer of Openwave Systems Inc. from 2008 to 2011 and as a director from 2004 to 2011. He served as the Chief Executive Officer and President and director of iPass, Inc. from 2001 to 2008 and as its Chairman from 2003 to 2008. Mr. Denman is also a member of the Board of Trustees of Seattle Children’s Hospital.

 

Other Public Company Boards: Costco Wholesale Corporation and VMware, Inc. In the last five years, Mr. Denman served on the boards of LendingClub Corporation from July 2017 to February 2021, Mitek Solutions, Inc. from December 2016 to December 2019, and ShoreTel, Inc. from May 2007 to September 2017.

 

Board Committees: Compensation and Leadership, Governance and Nominating (Chair), Executive

 

Director Qualifications:

 

  Relevant industry and technology experience, and financial and accounting expertise as former CEO and President of Emotient, Inc., Openwave Systems, Inc. and iPass, Inc.

 

  Software and services business, cybersecurity and safety and security experience as former CEO and President of Emotient, Inc., Openwave Systems, Inc. and iPass, Inc.

 

  Public company CEO, global business, and developing markets experience as former CEO and President of iPass, Inc. and Openwave Systems, Inc.

 

  Private equity, investment banking, and capital allocation experience as a General Partner of Sway Ventures

 

  Public company board experience

 

  LOGO  

 

 Principal Occupation:

 General Partner,

 Sway Ventures

 

 Age: 63

 Race: Black

 Director since: 2017

 Lead Independent Director  

 since 2019

 Independent

    

    

    

    

 

 

 EGON P.

 DURBAN

  

 

Mr. Durban is Co-CEO of Silver Lake, a global private equity firm, and is based in the firm’s Menlo Park office. Mr. Durban joined Silver Lake in 1999 as a founding principal and was previously Managing Partner and Managing Director from January 2013 to December 2019. He has previously worked in the firm’s New York office, as well as the London office, which he launched and managed from 2005 to 2010.

 

Other Public Company Boards: Dell Technologies Inc., Endeavor Group Holdings, Inc., which completed an initial public offering in May 2021, Qualtrics International Inc., Twitter, Inc., Unity Software Inc. and VMware, Inc. In the last five years, Mr. Durban served on the boards of Pivotal Software, Inc. from April 2018 to January 2020 and SecureWorks Corp. from December 2015 to May 2020.

 

Board Committees: Compensation and Leadership

 

Director Qualifications:

 

  Relevant industry, technology, global business, developing markets, and software and services business experience as Co-CEO of Silver Lake

 

  Financial and accounting expertise and private equity, investment banking and capital allocation experience as Co-CEO of Silver Lake and as a former associate with Morgan Stanley’s Investment Banking Division

 

  Public company board experience

  LOGO  

 

 Principal Occupation:

 Co-CEO,

 Silver Lake

 

 Age: 48

 Race: White

 Director since: 2015

 Independent

 

 

 

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 AYANNA M.

 HOWARD

  

 

Dr. Howard is the dean of the College of Engineering at The Ohio State University, as well as a tenured professor in the college’s Department of Electrical and Computer Engineering with a joint appointment in Computer Science and Engineering, positions that she has held since 2021. Dr. Howard is also the founder and board president of Zyrobotics, INC, a non-profit organization that provides AI-powered STEM tools for early childhood education. Dr. Howard held various positions at the Georgia Institute of Technology (“Georgia Tech”) from 2005 to 2021, including as the Chair of the School of Interactive Computing from 2018 to 2021, and as the Linda J. and Mark C. Smith Professor, School of Electrical & Computer Engineering from 2015 to 2021. Prior to her time at Georgia Tech, Dr. Howard worked at NASA’s Jet Propulsion Laboratory in various roles from 1993 to 2005.

 

Other Public Company Boards: Autodesk, Inc.

 

Board Committees: Audit

 

Director Qualifications:

 

  Financial and accounting expertise and private equity, investment banking, and capital allocation experience as the founder of Zyrobotics, INC and from her receipt of her M.B.A. from the Drucker Graduate School of Management

 

  Government, public policy and regulatory experience as the dean of the College of Engineering at The Ohio State University and former roles at NASA’s Jet Propulsion Laboratory

 

  Relevant industry, technology, cybersecurity, safety and security, and software and services business experience as the founder of Zyrobotics, INC, dean of the College of Engineering at The Ohio State University and former roles at NASA’s Jet Propulsion Laboratory

 

  Public company board experience

 

In addition to the qualifications listed above, the Board also values Dr. Howard’s diverse perspective as an African American woman. Dr. Howard was recommended as a potential director nominee by Major Executive Search, with her nomination facilitated through our director nominating process with Russell Reynolds, which is managed by our Governance and Nominating Committee. Refer to “How Our Board is Selected and Assessed—Director Nominating Process” on page 17 of this Proxy Statement for additional information.

 

 

  LOGO  

 

 Principal Occupation:

 Dean of the College of  Engineering,

 The Ohio State University

 

 Age: 50

 Race: Black

 Director since: February 2022

 Independent

    

    

    

    

    

    

    

    

    

    

    

    

 

 

 CLAYTON M.

 JONES

  

 

Mr. Jones served as Chairman of the Board of Rockwell Collins from 2002 through July 2014, and as Chief Executive Officer from June 2001 until his retirement in July 2013. Mr. Jones also served as President of Rockwell Collins and Corporate Officer and Senior Vice President of Rockwell International, which he joined in 1979.

 

Other Public Company Boards: Deere & Company. In the last five years, Mr. Jones served on the board of Cardinal Health, Inc. from September 2012 to November 2018.

 

Board Committees: Audit

 

Director Qualifications:

 

  Public company CEO, financial and accounting expertise, and global business experience as former CEO of Rockwell Collins

 

  Relevant industry, technology, cybersecurity, safety and security and private equity, investment banking and capital allocation experience as former CEO of Rockwell Collins and Corporate Officer and Senior Vice President of Rockwell International

 

  Government, public policy and regulatory experience as a former member of The Business Council, the Business Roundtable and the President’s National Security Telecommunications Advisory Committee

 

  Public company board experience

 

 

  LOGO  

 

 Principal Occupation:

 Retired; Formerly  Chairman, Chief Executive    Officer and President,  Rockwell Collins, Inc.  (“Rockwell Collins”)

 

 Age: 72

 Race: White

 Director since: 2015

 Independent

 

 

 

 

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 JUDY C.

 LEWENT

  

 

Ms. Lewent served as Chief Financial Officer of Merck, a pharmaceutical company, from 1990 until her retirement in 2007. Prior roles at Merck include Executive Vice President from 2001 to 2007 and President, Human Health Asia from 2003 to 2005.

 

Other Public Company Boards: In the last 5 years, Ms. Lewent served on the boards of GlaxoSmithKline plc from April 2011 to May 2021, and Thermo Fisher Scientific, Inc. from May 2008 to May 2021. Ms. Lewent also served on the board of Motorola, Inc. from May 1995 to May 2010.

 

Board Committees: Audit (Chair), Executive

 

Director Qualifications:

 

  Public company CFO, financial and accounting expertise, capital allocation experience, and global business experience as the former CFO of Merck

 

  Technology experience as a life member of the Massachusetts Institute of Technology

 

  Developing markets experience as the former CFO of Merck and board member of GlaxoSmithKline

 

  Government, public policy, and regulatory experience as former CFO at Merck and former board member of GlaxoSmithKline and Thermo Fisher

 

  Public company board experience

  LOGO  

 

 Principal Occupation:

 Retired; Formerly Executive  

 Vice President & Chief

 Financial Officer, Merck &

 Co., Inc. (“Merck”)

 

 Age: 73

 Race: White

 Director since: 2011

 Independent

 

 

 

 GREGORY K.

 MONDRE

  

 

Mr. Mondre is Co-CEO of Silver Lake, and is based in New York. Mr. Mondre joined Silver Lake in 1999 and was previously Managing Partner and Managing Director from January 2013 to December 2019. Prior to his time at Silver Lake, Mr. Mondre was a principal at TPG, where he focused on private equity investments across a wide range of industries, with a particular focus on technology.

 

Other Public Company Boards: GoodRx Holdings, Inc. In the last five years, Mr. Mondre served on the boards of Expedia Group from May 2020 to October 2021, GoDaddy, Inc. from May 2014 to February 2020, and Sabre Corporation from March 2007 to December 2018.

 

Board Committees: Governance and Nominating

 

Director Qualifications:

 

  Relevant industry, technology, global business, developing markets, and software and services business experience as Co-CEO of Silver Lake

 

  Financial and accounting expertise and private equity, investment banking, and capital allocation experience as Co-CEO of Silver Lake and as former principal at TPG

 

  Public company board experience

 

  LOGO  

 

 Principal Occupation:

 Co-CEO,

 Silver Lake

 

 Age: 47

 Race: White

 Director since: 2015

 Independent

 

 

 

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 JOSEPH M.

 TUCCI

  

 

Mr. Tucci is the Chairman of Bridge Growth Partners and Lead Director of GTY Technology Holdings, Inc. Mr. Tucci serves as a founder and director, and formerly as the Co-Chairman and Co-Chief Executive Officer from September 2016 to February 2019, of GTY Technology Holdings, Inc., a software-as-a-service company that offers a cloud-based suite of solutions for the public sector in North America. Mr. Tucci was the Chairman and Chief Executive Officer of EMC Corporation, a provider of enterprise storage systems, software, and networks. He was EMC’s Chairman from January 2006 and CEO from January 2001 until September 2016, when Dell Technologies acquired the company.

 

Other Public Company Boards: GTY Technology Holdings, Inc. and Paychex, Inc.

 

Board Committees: Compensation and Leadership (Chair), Governance and Nominating, Executive

 

Director Qualifications:

 

  Public company CEO, technology, global business, software and services business experience, and financial and accounting expertise as former Chairman, CEO and President of EMC Corporation

 

  Relevant industry, developing markets, and private equity experience as former Co-CEO and Co-Chairman of GTY Technology Holdings, Inc. and founding member and current Chairman of Bridge Growth Partners

 

  Government, public policy, and regulatory experience as a former member of the Business Roundtable and Chair of its Task Force on Education and the Workforce and as a former member of the Technology CEO Council

 

  Public company board experience

 

  LOGO  

 

 Principal Occupation:

 Chairman of Bridge Growth  

 Partners and Lead Director

 of GTY Technology

 Holdings, Inc.

 

 Age: 74

 Race: White

 Director since: 2017

 Independent

 

    

 

    

 

RECOMMENDATION OF THE BOARD

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE ELECTION OF THE EIGHT NOMINEES NAMED HEREIN AS DIRECTORS. UNLESS OTHERWISE INDICATED ON YOUR PROXY, YOUR SHARES WILL BE VOTED FOR THE ELECTION OF SUCH EIGHT NOMINEES AS DIRECTORS.

 

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OUR BOARD’S QUALIFICATIONS

We believe the Board should be comprised of individuals with appropriate skills and experiences to meet its board governance responsibilities and contribute effectively to the Company. Our Governance and Nominating Committee carefully considers the skills and experiences of current directors and new candidates to ensure that they meet the needs of the Company before nominating directors for election to the Board. All of our non-employee directors serve on Board committees, further supporting the Board by providing expertise to those committees. The needs of the committees also are reviewed when considering nominees to the Board. The Board has a deep working knowledge of matters common to large companies and is comprised of individuals with a mix of skills and qualifications which include:

 

     

Independence: Seven of eight director nominees

 

     

Gender and/or racial diversity: Three of eight director nominees

 

     

Relevant industry experience: Seven of eight director nominees

 

     

Public company CEO, division CEO or CFO: Five of eight director nominees

 

     

Financial and accounting expertise: All director nominees

 

     

Technology experience: All director nominees

 

     

Cybersecurity, safety and security experience: Four of eight director nominees

 

     

Software and services business experience: Six of eight director nominees

 

     

Global business experience: Seven of eight director nominees

 

     

Developing markets experience: Six of eight director nominees

 

     

Government, public policy and regulatory experience: Five of eight director nominees

 

     

Private equity, investment banking or capital allocation experience: All director nominees

 

     

Public company board experience: All director nominees

Specific experience, qualifications, attributes and skills of our nominees are listed in the biographies above.

HOW OUR BOARD IS SELECTED AND ASSESSED

Director Nominating Process

The Governance and Nominating Committee recommends candidates to the Board it believes are qualified and suitable to become members of the Board. The Governance and Nominating Committee also considers the performance of incumbent directors in determining whether to recommend them for re-election. The Governance and Nominating Committee considers recommendations from many sources, including members of the Board, management and search firms. From time to time, Motorola Solutions hires search firms to help identify and facilitate the screening and interview process of director candidates. In 2021, we continued our retention of Russell Reynolds to assist with this process. Russell Reynolds compiles a list of candidates (which may include candidates recommended by other search firms, e.g., Dr. Howard), evaluates each candidate and makes recommendations to the Governance and Nominating Committee. They screen candidates based on the Board’s criteria, perform reference checks, prepare a biography of each candidate for the Governance and Nominating Committee’s review and help arrange interviews if necessary. The Governance and Nominating Committee and the Chairman of the Board will conduct interviews with candidates who meet the Board’s criteria. Subject to the requirements set forth below in the section of this Proxy Statement titled “Agreement with Silver Lake” on page 19, the Governance and Nominating Committee has full discretion in considering potential candidates and making its nominations to the Board.

In connection with the Investment Agreement (as defined herein) entered into with affiliates of Silver Lake, Messrs. Durban and Mondre are Silver Lake designees on the Company’s slate of nominees for election to the Board. For more information, see the section of this Proxy Statement titled “Agreement with Silver Lake” on page 19.

The Governance and Nominating Committee will consider nominees recommended by Motorola Solutions shareholders as described below. A description of certain considerations our Governance and Nominating Committee reviews in evaluating director nominees is described in “Skills, Experience, and Commitment to Diversity” on page 18 of this Proxy Statement. A shareholder wishing to propose a candidate for consideration should forward the candidate’s name and information about the candidate’s qualifications in writing to Secretary, Motorola Solutions, Inc., 500 West Monroe Street, Chicago, IL 60661. Our Secretary will forward all recommendations received to the Chair of our Governance and Nominating Committee for discussion and consideration. A shareholder who wishes to directly nominate an individual as a director candidate, rather than recommending the individual to the Governance and Nominating Committee as a nominee, must comply with the advance notice requirements for shareholder nominations set forth in Article III, Section 13 of our Bylaws or the proxy access process set forth in Article III, Section 17 of our Bylaws. See the section titled “Important Dates for the 2023 Annual Meeting” on page 99 of this Proxy Statement for further information on these procedures.

 

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Skills, Experience, and Commitment to Diversity

The Board seeks members with varying professional backgrounds and other differentiating personal characteristics who combine a broad spectrum of experience and expertise with a reputation for integrity. The Board believes that maintaining a diverse membership enhances the Board’s discussions and enables the Board to better represent all of the Company’s constituents. As stated in our Board Governance Guidelines, when selecting directors, the Board and the Governance and Nominating Committee review and consider many factors, including: experience in the context of the Board’s needs; integrity; leadership qualities; diversity; ability to exercise sound judgment; existing time commitments; years to retirement age; and independence. They also consider ethical standards. Our Board Governance Guidelines maintain that diversity is one of the many factors considered by the Board and the Governance and Nominating Committee when selecting director nominees. The Board and the Governance and Nominating Committee recognize the importance of a Board representing diverse knowledge and experiences and strive to nominate directors with a variety of complementary skills, backgrounds and perspectives so that, as a group, the Board will possess the appropriate talent, skills, experience and expertise to oversee the Company’s businesses. The Governance and Nominating Committee annually assesses the effectiveness of its director nomination process and the Board Governance Guidelines.

Board Assessment and Director Peer Review Process

The Board recognizes that a robust evaluation and assessment process is an essential component of strong corporate governance practices and promoting Board effectiveness. The Governance and Nominating Committee oversees an annual assessment process of our director nominees. Our Board Governance Guidelines provide that, at a minimum, such assessment will address the overall effectiveness, achievement of mission, discharge of responsibilities, structure, meetings, processes, relationships with management and Board and committee development. Such assessment process also includes the following steps:

 

     

The Governance and Nominating Committee reviews the format of the Board assessment and director peer review process as necessary to help ensure that the solicited feedback remains relevant and appropriate.

 

     

Each director completes an annual self-assessment of the Board and the committees on which he or she serves. These self-assessments are designed to help assess the skills, qualifications, and experience represented on the Board and its committees, and to determine whether the Board and its committees are functioning effectively.

 

     

The results of this annual self-assessment are discussed by the full Board and each committee, as applicable, and changes to the Board’s and its committees’ practices are implemented as appropriate.

 

     

The Lead Independent Director also conducts a confidential director peer review process. As part of this process, the Lead Independent Director speaks with each other director individually to obtain insights regarding the contributions of other directors (and the Chairman of the Board may speak with each other director regarding the contributions of the Lead Independent Director), and to discuss issues in greater depth and obtain more targeted feedback with respect to Board, committee and individual director effectiveness.

With respect to Mr. Brown, the Compensation and Leadership Committee also conducts an annual review of his performance as CEO, as described in our Board Governance Guidelines and the charter of the Compensation and Leadership Committee.

 

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Board Refreshment

The Board believes that a degree of Board refreshment is important to ensure that Board composition is aligned with the changing needs of the Company and the Board, and that fresh viewpoints and perspectives are regularly considered. The Board also believes that directors develop an understanding of the Company and an ability to work effectively as a group over time that provides significant value, and therefore a significant degree of continuity year-over-year should be expected. Our current director nominee tenure as of March 31, 2022 is as follows:

 

   
DIRECTOR NOMINEE TENURE DIVERSITY  

BOARD REFRESHMENT

 

   
LOGO         

+6

 

Directors

added

   

-5

 

Directors

retired

 
 

over the last 7 years

 

   

The Board does not have absolute limits on the length of time that a director may serve, but considers the tenure of directors as one of several factors in re-nomination decisions. As set forth in our Board Governance Guidelines, the Board requires that a director must offer to resign if a significant change in personal circumstances, including job responsibilities, occurs, and has established a retirement age of 75 for non-executive directors, requiring such directors to tender their resignation from the Board at the annual meeting of shareholders following their 75th birthday. Directors who are members of management will retire from the Board upon retirement from the Company. The CEO may remain on the Board after retirement from the Company with the approval of the Board. There are no additional exemptions or conditions to this retirement policy other than what is set forth in our Board Governance Guidelines.

While the Board believes that refreshment is an important consideration in assessing Board composition, it also believes the best interests of the Company are served by being able to take advantage of all available talent. Therefore, the Board does not make determinations with regard to its membership based solely on age or tenure.

Agreement with Silver Lake

On September 5, 2019, in connection with the Company’s continuing relationship with Silver Lake and the Company’s repurchase and settlement of the outstanding principal amount of 2.00% senior convertible notes due 2020 issued to Silver Lake, the Company entered into an investment agreement with affiliates of Silver Lake (the “Investment Agreement”), relating to the issuance to Silver Lake (references to Silver Lake in this section “Agreement with Silver Lake” refer to such affiliates of Silver Lake mentioned above) $1 billion in aggregate principal amount of 1.75% senior convertible notes due 2024 (the “2024 Notes”). The Investment Agreement provides that Silver Lake will, subject to certain conditions, continue to have rights to representation on the Board and requires that, for so long as Silver Lake has rights to nominate a director to the Board, the Company will include a Silver Lake designee on its slate of nominees for election to the Board at each of the Company’s meetings of shareholders in which directors are to be elected and to use its reasonable efforts to cause the election of such person. In addition, with respect to the voting obligations in the Investment Agreement, Silver Lake is deemed to own only shares of Common Stock that have actually been issued upon conversion or repurchase by the Company of any of the 2024 Notes. These voting obligations require Silver Lake to vote any shares of Common Stock beneficially owned by it in support of Company-nominated directors and otherwise in accordance with the recommendations of the Board. However, as of the date of this Proxy Statement, Silver Lake has not converted any of the 2024 Notes into shares, and therefore has no shares related to the 2024 Notes to vote.

For further information regarding the Investment Agreement, including a description of certain obligations and restrictions binding on the parties, as well as a copy of such Investment Agreement, please refer to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on September 5, 2019, and see Note 5 Debt and Credit Facilities of our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021.

 

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HOW OUR BOARD GOVERNS THE COMPANY

We believe that the governance tone of a company is set at the top. The Board has:

 

     

Responsibility for overseeing management and providing strategic guidance

 

     

A belief in the steady refreshment of the Board to bring new and diverse perspectives

 

     

A belief in the importance of staying well informed

 

     

A willingness to manage risks, seize opportunities and embrace leadership

Board Governance Practices and Principles

We adhere to a number of good board governance practices and principles:

 

     

Governance and Nominating Committee oversight of ESG matters as well as Audit Committee oversight of ESG-related risks

 

     

7 of our 8 members are independent, including all committee members

 

     

A Lead Independent Director

 

     

Regular executive session meetings of independent directors

 

     

Annual director self-assessment process

 

     

Regular risk assessment processes

 

     

Board Governance Guidelines and Principles of Conduct

 

     

Director Independence Guidelines

Corporate Governance Practices and Principles

We maintain a strong foundation of corporate governance practices and principles:

 

     

Proxy access provision in our Bylaws

 

     

Annual election of directors

 

     

No super majority voting provisions in our organizational documents

 

     

No “poison pill”

 

     

Majority voting standard in uncontested director elections

 

     

20% threshold for shareholder right to call special meeting

 

     

Shareholder right to act by written consent

 

     

Succession planning (for additional information, see “Human Capital Management and Succession Planning” on page 21 of this Proxy Statement)

 

     

Proactive shareholder engagement (for additional information, see “Shareholder Engagement” on page 23 of this Proxy Statement)

Compensation Governance Practices and Principles

We maintain a robust compensation governance framework:

 

     

Pay-for-performance and at-risk compensation

 

     

A significant portion of our targeted annual compensation is performance-based and/or subject to forfeiture (“at-risk”), with emphasis on variable pay to reward short- and long-term performance measured against pre-established objectives informed by the Company’s strategy. For 2021, performance-based compensation comprised approximately 93% of the targeted annual compensation for our CEO and, on average, approximately 83% of the targeted annual compensation for our other NEOs.

 

     

Compensation aligned with shareholder interests

 

     

Performance measures for incentive compensation are linked to the overall performance of the Company and are designed to be aligned with the creation of long-term shareholder value.

 

     

Emphasis on future pay opportunity vs. current pay

 

     

Our long-term incentive awards are equity-based, use multi-year vesting provisions to encourage retention, and are designed to align our NEOs’ interests with long-term shareholder interests. For 2021, long-term equity compensation comprised approximately 81% of the targeted annual compensation for our CEO and, on average, approximately 66% of the targeted annual compensation for the other NEOs.

 

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Retention of independent compensation consultant

 

     

Annual “say on pay” vote

 

     

No excise tax gross-up provisions

 

     

A recoupment “clawback” policy for compensation paid to certain officers

 

     

Robust stock ownership guidelines for directors and officers

 

     

An anti-hedging policy

 

     

Double trigger” severance benefits in the event of a change in control

 

     

No repricing of options without shareholder approval

 

     

No excessive perquisites

Governance of Risks and Corporate Controls

We maintain comprehensive governance of risks and corporate controls:

 

     

Code of Business Conduct

 

     

Supplier Code of Conduct and regular supplier audits

 

     

Annual training programs for employees addressing information security, intellectual property protection and data protection and privacy

 

     

Anti-Human Trafficking Compliance Plan

 

     

Robust oversight of risk (for additional information, see “Risk Oversight” on page 21 of this Proxy Statement)

We encourage you to visit investors.motorolasolutions.com/corporate-governance/GovDocs to obtain more information and view our governance documents, including our Code of Business Conduct and our Board Governance Guidelines, which are publicly available on such website. The information contained on or accessible through our corporate website is not incorporated by reference into and is not a part of this Proxy Statement. Any legally required disclosures regarding amendments to, or waivers of, provisions of our Code of Business Conduct will be posted on our website within four business days following the date of the amendment or waiver. There were no waivers in 2021.

Human Capital Management and Succession Planning

The Board believes that human capital management and succession planning, including DEI initiatives, are critical to the Company’s success. Our Board’s involvement in leadership development and succession planning is ongoing throughout the year, and the Board provides input on important decisions in each of these areas. The Board has primary responsibility for succession planning for the CEO and oversight of other senior management positions. The Compensation and Leadership Committee oversees the development of the process and will periodically report to the Board on succession planning, as described in our Board Governance Guidelines. The entire Board will work with the Compensation and Leadership Committee, or a special committee designated by the Board, to nominate and evaluate potential successors to the CEO. In 2021, the Board reviewed short and long-term succession plans for the CEO and other members of management who are part of our Executive Committee. When assessing possible CEO candidates, the Board identified skills and behavioral characteristics it considers a requirement for the Company’s CEO. The Board evaluates these succession plans with the overall business strategy in mind. When possible, potential leaders are introduced to the Board through presentations or separate events. The Compensation and Leadership Committee is also regularly updated on key talent indicators for the overall workforce, including recruiting and attrition, diversity, equity and inclusion, and development programs.

Risk Oversight

Our approach to enterprise risk management is designed to effectively identify, assess, prioritize, mitigate, and monitor the Company’s principal risks. Management is responsible for the Company’s day-to-day risk management activities. The Board’s role is to exercise informed risk oversight, which is done both directly and indirectly through its committees. The Board oversees the business of the Company, including CEO and senior management performance and risk management, to assure that the long-term interests of the shareholders are being served. Each committee of the Board is also responsible for reviewing the risk exposure of the Company related to the committee’s areas of responsibility and providing input to management on such risks. Management and our Board have a robust process embedded throughout the Company to identify, analyze, manage and report all significant risks facing the Company. Our CEO and other senior managers regularly report to the Board on significant risks facing the Company, including financial, ESG, cyber-related (including cybersecurity, information security and data privacy), operational, strategic, reputational, M&A/integration and regulatory and compliance risks. Each of the Board committees reviews with management significant risks related to the committee’s area of responsibility and reports to the Board on such risks.

While each committee is responsible for reviewing significant risks in the committee’s area of responsibility, the entire Board is regularly informed about such risks through committee reports and presentations. The oversight of specific risks by Board committees enables the entire Board to oversee risks facing the Company more effectively and develop strategic direction taking into account the effects and magnitude of such risks. The independent Board members also discuss the Company’s significant risks when they meet in executive session without management.

 

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Our audit services department has a very important role in the risk management program, providing management and the Audit Committee with an overarching and objective view of the risk management activities of the Company. Audit services identifies and conducts engagements utilizing an enterprise risk management model, with the engagements spanning financial, operational, strategic and compliance risks. The engagement results assist management in maintaining acceptable risk levels. The director of audit services reports directly to the Audit Committee as well as the Chief Financial Officer and meets regularly with the Audit Committee and its chairperson, including in executive session.

Additional detail regarding the manners in which the Board and its committees undertake their risk oversight responsibilities include the following:

Board

 

     

Receives updates on our business operations, financial results, and long-range plan at its regularly-scheduled meetings

 

     

Monitors overall culture and risk management environment

 

     

Receives periodic (at least annual) updates from management regarding top-identified enterprise risks

 

     

Receives annual report on political contributions made by the Company and MSIPAC, a voluntary employee-funded political action committee

Audit Committee

 

     

Reviews and considers our annual audit risk assessment, which identifies risks related to our internal control over financial reporting and informs our internal and external audit plans

 

     

Monitors independence of our external auditor

 

     

Reviews our annual audited financial statements and quarterly financial statements with management and our external auditor

 

     

Reviews risks related to regulatory and compliance matters

 

     

Reviews the use and consistent presentation of non-GAAP measures in our earnings releases and SEC filings

 

     

Considers the impact of risk on our financial position and the adequacy of our risk-related internal controls

 

     

Receives annual enterprise risk management report

 

     

Monitors and oversees ESG-related risks, including cyber-related risks, as further described below under “Board Oversight of ESG-Related Risks” and “Board Oversight of Cyber-Related Risks”

 

     

Receives quarterly report on litigation and compliance trends and an annual update on regulatory developments

Compensation and Leadership Committee

 

     

Assesses, on an annual basis, whether our compensation plans, policies, and practices encourage excessive or inappropriate risk taking by employees

 

     

Reviews risks related to talent acquisition, retention and development, as well as management succession

 

     

Monitors progress toward internal DEI goals

Governance and Nominating Committee

 

     

Conducts an annual review of our corporate governance policies and practices

 

     

Receives updates on emerging corporate governance issues and trends

 

     

Oversees annual self-assessment process for the Board and each of its committees, which includes soliciting directors’ views on our strategy and enterprise risks

 

     

Monitors and reviews our ESG strategy, initiatives and policies

 

     

Reviews quarterly expenditures for Company and MSIPAC political contributions, lobbying, and industry association memberships

 

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Board Oversight of ESG-Related Risks

The Board views oversight and effective management of ESG-related risks, particularly environmental and social issues and their related risks, as important to our ability to execute our strategy and achieve long-term sustainable growth. The Board receives periodic updates on ESG topics. In addition to oversight by the full Board, the Board has delegated primary responsibility for more frequent and in-depth oversight of our ESG strategy, initiatives and policies to the Governance and Nominating Committee. The Governance and Nominating Committee receives at least semi-annual updates on topics such as DEI, environmental stewardship, human capital management and community engagement. The Governance and Nominating Committee receives such updates from our Vice President, Legal and ESG and/or Chief Diversity Officer, one of whom is a member of our Executive Management ESG Governance Team. We formed our Executive Management ESG Governance Team in 2020 to drive decision-making on ESG strategies and initiatives, and the team is headed by two members of our Executive Committee. In addition, the Audit Committee reviews ESG-related risks as part of our enterprise risk management program, reviews our corporate responsibility report each year (along with the full Board) and receives at least semi-annual updates on ESG-related risks. In 2022, we anticipate that our Audit Committee will review our first TCFD report, which we expect to publish this year.

Board Oversight of Cyber-Related Risks

Another area which our Board views as important to our ability to execute strategy and achieve long-term sustainable growth is oversight and effective management of cyber-related risks, including risks relating to cybersecurity, information security and data privacy. Our Board has delegated to the Audit Committee the responsibility to oversee such cyber-related risks. Specifically, subject to oversight by the full Board, the Audit Committee receives quarterly cybersecurity and information security reports, as well as an annual report that includes a review of potential digital threats and vulnerabilities and our cybersecurity, information security and data privacy framework designed to protect intellectual property, confidentiality, data integrity, and availability of critical assets and information. The Audit Committee receives this information from our head of Enterprise Information Security & Cybersecurity.

Shareholder Engagement

We recognize the value of listening to and considering the perspectives of our shareholders. Developing relationships with our shareholders is an integral part of that process and we routinely engage with, and collect feedback from, our shareholders on a variety of topics, through both our investor relations team and shareholder outreach. Our senior management team maintains regular contact with a broad base of investors, including through quarterly earnings calls and other channels of communication, to understand their concerns. In addition, we have a robust shareholder outreach program, which is a recurring effort led by a cross-functional team that includes members of our investor relations, legal, executive rewards, ESG, environmental, health and safety and Office of Ethics teams, with participation from our information technology team. In 2021, we held discussions with a diverse cross-section of our shareholders. Specifically, during the spring of 2021, we contacted our top 25 shareholders (owning approximately 55% of our outstanding stock) to collect feedback, and in the fall and winter of 2021, we offered to engage again with such top 25 shareholders (owning approximately 57% of our outstanding stock). These discussions covered various ESG, compensation, operational and financial performance matters. Recent examples over the past few years of enhancements to our practices that have reflected feedback from our shareholders include creating a DEI website that includes, among other items, diversity data for our employees; adopting a proxy access provision in our Bylaws; reinforcing our pay-for-performance philosophy through the enhanced design of our incentive compensation programs; and emphasizing our commitment to high standards and ethics and accountability when participating in the political process through additional public disclosure of our controls, procedures, and oversight efforts. The additional disclosure of such controls, procedures, and oversight efforts may be found on our corporate website.

We are continuing our program of active shareholder engagement during fiscal 2022, including participation at industry and investment community conferences, analyst meetings, and select one-on-one meetings with shareholders.

In addition to direct engagement, we have instituted a number of complementary mechanisms that allow shareholders to effectively communicate with the Board and management, including the policy regarding direct correspondence with individual directors and the Board as a whole described in the section entitled “How You Can Communicate with our Board” on page 28 of this Proxy Statement, a commitment to thoughtfully consider shareholder proposals submitted to the Company, an annual advisory vote to approve executive compensation, and attendance at our annual shareholder meetings. Our investor relations website (at investors.motorolasolutions.com) features substantive information and materials for the reference of our shareholders, including earnings and conference presentations, corporate governance documents, public filings, access to our ESG webpage and news releases. The information contained in or accessed through our corporate website, as described in this “Shareholder Engagement” section, is not incorporated by reference into and is not a part of this Proxy Statement.

 

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OUR BOARD’S LEADERSHIP STRUCTURE

At the annual meeting of the Board held in May 2011, the Board combined the roles of Chairman and Chief Executive Officer and appointed Gregory Q. Brown to serve as both Chief Executive Officer and Chairman of the Board and also appointed an independent director as Lead Independent Director. The Board reappointed Mr. Brown as Chairman of the Board and an independent director as Lead Independent Director at the annual meetings of the Board held in 2012 through 2021. The Board determined that Mr. Brown’s thorough knowledge of Motorola Solutions’ business, strategy, people, operations, competition and financial position coupled with his leadership and vision made him well positioned to chair Board meetings and bring key business and stakeholder issues to the Board’s attention. Additionally, this structure with a combined Chairman and CEO and Lead Independent Director has, as evidenced by the feedback of directors over the years, provided for a highly conducive atmosphere for directors to exercise their responsibilities and fiduciary duties, and to enjoy adequate opportunities to thoroughly deliberate matters before the Board and to make informed and independent decisions.

Our Lead Independent Director, currently Mr. Denman, presides at all meetings of the Board at which the Chairman is not present, including the executive sessions of the Board; advises on Board meeting agendas, materials and schedules and assesses the quality, quantity and timeliness of the information provided to the Board by management to assist the Board in performing its oversight duties; acts as a liaison between our independent directors and the Chairman and management by, among other things, regularly consulting with the independent directors who serve as committee chairs and making recommendations to the Company when requested by the Chairman of the Board; assists the Chairman in performing Board responsibilities as requested; and leads the confidential director peer review process and the annual assessment of our CEO, as described above on page 18 of this Proxy Statement under “Board Assessment and Director Peer Review Process.” If elected at the Annual Meeting of Shareholders, Mr. Denman will continue to serve as our Lead Independent Director.

 

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COMMITTEES OF THE BOARD

To assist it in carrying out its duties, the Board has delegated certain authority to several committees. The Board currently has the following standing committees: (1) Audit, (2) Compensation and Leadership, (3) Governance and Nominating, and (4) Executive. The charters for each of the Audit Committee, Compensation and Leadership Committee and Governance and Nominating Committee are available on our website at investors.motorolasolutions.com/corporate-governance/GovDocs. Committee membership as of December 31, 2021 (except as otherwise noted), the number of meetings of each committee during 2021, the key responsibilities of each committee and independence information are described below:

 

 

    AUDIT COMMITTEE*              

   

 

Key Responsibilities

 

   Assist the Board in fulfilling its oversight responsibilities as they relate to the integrity of the Company’s financial statements and accounting policies, internal controls, disclosure controls and procedures, financial reporting practices and legal and regulatory compliance.

 

 

    2021 Meetings: 10

 

 

    Judy C. Lewent (Chair)

    Ayanna M. Howard**

    Clayton M. Jones

 

*  Gregory K. Mondre served as a member of the Audit Committee until February 15, 2022

**  Audit Committee member as of February 15, 2022

   

   Engage the independent registered public accounting firm.

 

   Monitor the qualifications, independence and performance of the Company’s independent registered public accounting firm and the performance of the Company’s internal auditors.

 

   Maintain, through regularly scheduled meetings, a line of communication between the Board and the Company’s financial management, internal auditors and independent registered public accounting firm.

 

   Oversee compliance with the Company’s policies for conducting business, including ethical business standards as specified in the Company’s Code of Business Conduct.

 

   Review the Company’s overall financial position, asset utilization and capital structure.

 

   Review the need for equity and/or debt financing and specific outside financing proposals.

 

   Monitor the performance and investments of employee retirement and related funds.

 

   Review the Company’s dividend payment plans and practices.

 

   Prepare the report of the Audit Committee included in this Proxy Statement.

 

   Review significant risk exposure as it relates to the Audit Committee’s areas of responsibilities, including ESG-related, cyber-related, financial and regulatory and compliance risk.

 

   Review the Company’s quarterly and annual SEC filings and quarterly earnings releases.

 

Financial Expertise, Independence, and Financial Literacy

 

The Board has determined that each member of the Audit Committee (as well as former member Gregory K. Mondre) qualifies as an independent director under the corporate governance standards of the NYSE, our Director Independence Guidelines and the additional Audit Committee independence requirements under the rules of the SEC. The Board has also determined that each member of the Audit Committee (as well as former member Gregory K. Mondre) qualifies as an “audit committee financial expert,” as defined by SEC rules. All members of the Audit Committee are familiar with finance and accounting practices and principles and are financially literate.

 

 

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    COMPENSATION AND

    LEADERSHIP COMMITTEE

 

 

Key Responsibilities

 

   Assist the Board in overseeing the management of the Company’s human resources, including:

 

   compensation and benefits programs;

 

   CEO performance and compensation;

 

   executive development and succession;

 

   DEI efforts; and

 

   evaluation of the Company’s senior management.

 

   Evaluate the overall performance and approve the compensation of officers subject to Section 16 of the Securities Exchange Act of 1934, as amended, and of officers who are members of the senior leadership team.

 

 

    2021 Meetings: 6

 

    Joseph M. Tucci (Chair)

    Kenneth D. Denman

    Egon P. Durban

 

 

   Determine and approve CEO compensation with the concurrence of the independent directors of the Board.

 

   Review and discuss the Compensation Discussion and Analysis (“CD&A”) with management and make a recommendation to the Board on the inclusion of the CD&A in this Proxy Statement.

 

   Prepare the report of the Compensation and Leadership Committee included in this Proxy Statement.

 

   Review significant risk exposure as it relates to the Compensation and Leadership Committee’s areas of responsibilities, including compensation risk.

 

The Compensation and Leadership Committee may, in its reasonable discretion, delegate all or a portion of its duties and responsibilities to a subcommittee of the Compensation and Leadership Committee and, solely with respect to compensation of non-executive officer employees, to management, as appropriate.

 

The Compensation and Leadership Committee is supported in its work by our independent compensation consultant, Compensation Advisory Partners LLC (“CAP”). CAP provides the Compensation and Leadership Committee with information regarding market compensation and practices, assists the Compensation and Leadership Committee in the review and evaluation of such compensation and practices, carries out competitive reviews as directed by the Compensation and Leadership Committee, and advises the Compensation and Leadership Committee on executive compensation decisions and the Governance and Nominating Committee on non-employee director compensation decisions.

 

Independence

 

The Board has determined that each member of the Compensation and Leadership Committee qualifies as an independent director under the corporate governance standards of the NYSE (including the additional Compensation and Leadership Committee requirements) and our Director Independence Guidelines. The Board has also determined that each member of the Compensation and Leadership Committee is a “non-employee director” for purposes of Section 16 of the Exchange Act.

 

 

 

    GOVERNANCE AND              

    NOMINATING

    COMMITTEE

 

   

 

Key Responsibilities

 

   Identify individuals qualified to become Board members, consistent with the criteria approved by the Board.

 

   Recommend director nominees and individuals to fill vacant positions and to serve on committees.

 

   Assist the Board in interpreting the Company’s Board Governance Guidelines, the Board’s Principles of Conduct and any other similar governance documents adopted by the Board.

 

   Oversee the evaluation of the Board and its committees.

 

   Review the independence of directors and evaluate related party transactions.

 

   Oversee the governance of the Board and compensation of non-employee members of the Board.

 

 

    2021 Meetings: 5

 

 

 

    Kenneth D. Denman (Chair)

    Gregory K. Mondre

    Joseph M. Tucci

 
       

   Review the Company’s ESG strategy, initiatives and policies.

 

   Review significant risk exposure as it relates to the Governance and Nominating Committee’s areas of responsibilities.

 

Independence

 

The Board has determined that each member of the Governance and Nominating Committee qualifies as an independent director under the corporate governance standards of the NYSE and our Director Independence Guidelines.

 

 

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    EXECUTIVE COMMITTEE

 

   

 

   Act for the Board between meetings on matters already approved in principle by the Board.

 

   Exercise the authority of the Board on specific matters assigned by the Board from time to time.

 

 

    2021 Meetings: 0

 

 

 

    Gregory Q. Brown (Chair)

    Kenneth D. Denman

    (Lead Independent Director)

    Judy C. Lewent

    Joseph M. Tucci

 

 

Attendance at Board Meetings

The Board held five meetings during 2021. During 2021, all but one director attended 100% of the combined total meetings of the Board and the committees on which he or she served for the period for which he or she served, and one director attended 82% of such meetings. At the Board meetings, independent directors of the Company meet regularly in executive session led by Mr. Denman, the Lead Independent Director, and without management as required by the Board Governance Guidelines and NYSE listing standards. Generally, executive sessions are held in conjunction with regularly-scheduled meetings of the Board. In 2021, the non-employee independent members of the Board met in executive session five times. In addition, Board members are expected to attend the annual meeting of shareholders (virtually or in person, depending on the meeting format) as provided in the Board Governance Guidelines. All of the directors who stood for election at the 2021 Annual Meeting of Shareholders attended that meeting.

INDEPENDENCE

On March 10, 2022, the Board made the determination, based on the recommendation of the Governance and Nominating Committee and in accordance with our Director Independence Guidelines, that the current non-employee directors, Mr. Denman, Mr. Durban, Dr. Howard, Mr. Jones, Ms. Lewent, Mr. Mondre and Mr. Tucci, were independent during the periods in 2021 and 2022 that they were members of the Board. Mr. Brown does not qualify as an independent director because he is an executive officer of the Company. See “Motorola Solutions’ Relationship with Entities Associated with Independent Directors” below for further details.

Determining Independence

The Director Independence Guidelines include both the NYSE independence standards and additional independence standards the Board has adopted to determine if a relationship that a Board member has with the Company is material. We have adopted a stricter application of the NYSE independence standards requiring a lookback period of four years when assessing independence in connection with a director’s (i) status as an employee of the Company, (ii) direct compensation from the Company in excess of $120,000, (iii) relationship with our internal or external auditor, and (iv) employment with a company that has made payments to, or received payments from, the Company for property or services.

A complete copy of the Director Independence Guidelines is available on the Company’s website at investors.motorolasolutions.com/corporate-governance/GovDocs.

Motorola Solutions’ Relationship with Entities Associated with Independent Directors

When assessing independence, Ms. Lewent had a relationship with an entity that was reviewed by the Board under independence standards covering contributions or payments to charitable or similar not-for-profit organizations. In addition, each of Mr. Denman, Mr. Durban, Dr. Howard, Ms. Lewent and Mr. Mondre had relationships with entities that were reviewed by the Board under independence standards covering payments to, or received from, other entities. In each case, the payments or contributions were significantly less than the NYSE independence standards or the Director Independence Guidelines adopted by the Board, or did not constitute a disqualifying event under such standards and were determined by the Board to be immaterial.

RELATED PERSON TRANSACTION POLICY AND PROCEDURES

The Company has established a written policy for the review of certain related person transactions, including those that are required to be disclosed in this Proxy Statement, which policy the Company amended in August 2021 (the “RPT Policy”). For purposes of the RPT Policy, a “related person transaction” includes, subject to certain exceptions, a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which (i) the Company or any of its subsidiaries was, is or will be a participant, (ii) the amount involved exceeds or will exceed $120,000, and (iii) any Related Person (as defined below) has or will have a direct or indirect material interest. The RPT Policy supplements our other conflict of interest policies set forth in the Principles of Conduct for Members of the Motorola Solutions, Inc. Board of Directors, the Code of Business Conduct for employees and our other internal procedures.

 

 

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For purposes of the RPT Policy, a Related Person is defined to include directors, director nominees and executive officers of the Company since the beginning of the Company’s last fiscal year, beneficial owners of 5% or more of any class of voting securities of the Company and members of their respective immediate families. The Governance and Nominating Committee reviews all RPT Policy matters.

The RPT Policy provides that, prior to engaging in any possible related person transaction, any such transaction is to be promptly reported to the Company’s Secretary. The Secretary will assist with gathering important information about the possible related person transaction. If the Secretary determines that such transaction is a defined “related person transaction,” then the Governance and Nominating Committee will conduct a reasonable prior review of such related person transaction. There may be circumstances where ratification of a related person transaction by the Governance and Nominating Committee is warranted if such a prior review is unreasonable.

The Governance and Nominating Committee will determine whether to approve, reject or, if necessary, ratify the related person transaction, and will prohibit such transaction if it determines it to be inconsistent with the interests of the Company and its shareholders. In making its determination, the Governance and Nominating Committee may consider: (i) whether the related person transaction is in the ordinary course of the Company’s business; (ii) whether the related person transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances; (iii) the aggregate amount of the related person transactions; (iv) the types of goods and services provided; (v) the relationship of the Related Person to the Company; (vi) the extent of the Related Person’s interest in the related person transaction; (vii) whether the related person transaction involves a conflict of interest; and (viii) any other information regarding the related person transaction or Related Person that would be material to investors in light of the circumstances of the transaction.

Motorola Solutions had no related person transactions requiring approval or ratification under the RPT Policy since January 1, 2021.

HOW YOU CAN COMMUNICATE WITH OUR BOARD

All interested parties, including our shareholders, who wish to communicate with the Board of Directors as a whole, any individual director (including the Chairman or the Lead Independent Director), or the non-management directors as a group, may send written correspondence addressed to the attention of Secretary, Motorola Solutions, Inc., 500 West Monroe Street, Chicago, IL 60661 or by email to boardofdirectors@MotorolaSolutions.com. Our Secretary reviews all written communications and forwards to the Board a summary and/or copies of any such correspondence that, in the opinion of the Secretary, deals with the functions of the Board or Board committees or that she otherwise determines requires the Board’s or any Board committee’s attention.

HOW WE DETERMINE DIRECTOR COMPENSATION

The Governance and Nominating Committee recommends to the Board the compensation for non-employee directors, which is to be consistent with market practices of other similarly situated companies and takes into consideration the impact on non-employee directors’ independence and objectivity. This recommendation is based, in part, on input received from CAP, the Company’s independent compensation consultant. CAP conducts compensation benchmarking regarding compensation of non-employee directors of the Company’s peer group, which results the Governance and Nominating Committee considers. The Board has asked the Compensation and Leadership Committee to assist the Governance and Nominating Committee in making such recommendations. The charter of the Governance and Nominating Committee does not permit it to delegate director compensation matters to management, and management has no role in recommending the amount or form of director compensation.

 

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HOW OUR DIRECTORS ARE COMPENSATED

Non-employee director compensation on an annual basis is as follows:

 

 

 

Cash Compensation

 

  

 

 

Annual Compensation (paid quarterly)

 

   

Annual Cash Retainer

  

$100,000

   

Lead Independent Director Fee

  

  $40,000

   

Audit Committee Chairperson Fee

  

  $25,000

   

Compensation and Leadership

Committee Chairperson Fee

  

  $20,000

   

Governance and Nominating

Committee Chairperson Fee

  

  $15,000

   

Audit Committee Member Fee

  

  $10,000

 

 

Equity Compensation

 

 

  

 

 

Annual Compensation (paid annually)

 

 

   

Annual Equity Grant

  

$190,000

During 2021, a director could elect to receive all or a portion of his or her annual cash retainer and other cash fees in the form of (i) deferred stock units (“DSUs”) that settle when the director terminates service, (ii) DSUs that settle after one year (unless service is earlier terminated), or (iii) outright shares of Common Stock. Directors could also elect to receive the annual equity grant in the form of (i) DSUs that settle when the director terminates service, or (ii) DSUs that settle after one year (unless service is earlier terminated). These choices allow directors to engage in tax planning appropriate for their circumstances. Notwithstanding earlier settlement or receipt of shares, directors must hold all shares awarded or paid to them until termination of service from the Board.

On May 18, 2021, each non-employee director received his or her annual equity award in the form of a DSU award of 954 shares of Common Stock. The number of DSUs awarded was determined by dividing $190,000 by the fair market value of a share of Common Stock on the date of grant (rounded up to the next whole number) based on the closing price on the date of grant. For a non-employee director who becomes a member of the Board after the annual grant of DSUs, the award will be prorated based on the number of full months to be served until the next annual meeting of shareholders ($15,833.33 per month) divided by the closing price of the Common Stock on the day of election to the Board.

In February 2022, the Board approved (upon recommendation from the Governance and Nominating Committee and after considering market data from CAP) an increase to the amount of the annual equity grant for each non-employee director from $190,000 to $220,000, with such increased amount to apply to our directors’ compensation beginning with the annual equity grant that will be made in May 2022. The increase is intended to further align our director compensation with the median of the peer group used for evaluating executive compensation decisions.

Non-employee directors are not eligible to participate in the Motorola Solutions Management Deferred Compensation Plan. Motorola Solutions does not have a non-equity incentive plan or pension plan for non-employee directors. Non-employee directors do not receive any additional fees for attendance at meetings of the Board or its committees, or for additional work done on behalf of the Board or a committee. The Company also reimburses its directors and, in certain circumstances, spouses who accompany directors, for travel, lodging and related expenses they incur in attending Board and committee meetings or other meetings as requested by Motorola Solutions. Mr. Brown, who was an employee during 2021, received no additional compensation for serving on the Board.

 

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The following table further summarizes compensation paid to the non-employee directors during 2021. Dr. Howard joined the Board after the end of fiscal 2021 and therefore is not included in the table.

 

 Name

 (a)

 

 

 

Fees Earned or
Paid in Cash  ($)(1)
(b)

 

   

Stock
Awards ($)(2)(3)

(c)

 

   

All Other   

Compensation ($)(4)   
(g)   

 

 

Total ($)
(h)

 

 
       

 Kenneth D. Denman

 

 

155,000    

 

 

 

190,027    

 

 

157

 

 

345,184

 

 Egon P. Durban

 

 

0    

 

 

 

290,615    

 

 

157

 

 

290,772

 

 Clayton M. Jones

 

 

110,000    

 

 

 

190,027    

 

 

157

 

 

300,184

 

       

 Judy C. Lewent

 

 

125,000    

 

 

 

190,027    

 

 

157

 

 

315,184

 

       

 Gregory K. Mondre

 

 

0    

 

 

 

300,517    

 

 

157

 

 

300,674

 

       

 Joseph M. Tucci

 

 

120,000    

 

 

 

190,027    

 

 

157

 

 

310,184

 

 

(1)

During 2021, directors could elect to receive all or a portion of their annual cash retainer or other cash fees in the form of (i) DSUs that settle when the director terminates service, (ii) DSUs that settle after one year (unless service is earlier terminated), or (iii) outright shares (in each case, rounded up to the next whole share). The amounts in column (b) are the portion of the annual cash retainer and any other fees the non-employee director has elected to receive in cash.

(2)

The non-employee directors received an annual grant of DSUs on May 18, 2021. With respect to the annual grant of equity, Messrs. Denman, Durban, Jones, Mondre and Tucci elected to receive DSUs that settle at termination of service, and Ms. Lewent elected to receive DSUs that settle at termination or after one year, whichever is earlier, and these amounts are included in column (c). All amounts in column (c) are the aggregate grant date fair value of DSUs computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation–Stock Compensation (“ASC Topic 718”), including dividend equivalents, as applicable. The number of DSUs or shares of Common Stock received, including quarterly fees elected to be received in equity, and the fair value on each date of grant are as follows:

 

 

 

April 2

 

May 18

 

July 2

 

October 1

 

December 31

 Directors

Common

Stock/

Deferred

Stock Units

Annual Grant of

Deferred Stock Units

Common

Stock/

Deferred

Stock Units

Common

Stock/

Deferred

Stock Units

Common

Stock/

Deferred

Stock Units

 Kenneth D. Denman

    954                

 Fair Value

  $190,027          

 Egon P. Durban

  133   954             114   107   93

 Fair Value

  $25,052   $190,027             $25,196   $25,071   $25,268

 Clayton M. Jones

    954                

 Fair Value

  $190,027          

 Judy C. Lewent

    954                

 Fair Value

  $190,027          

 Gregory K. Mondre

  146   954             125   118   102

 Fair Value

  $27,501   $190,027             $27,628   $27,649   $27,713

 Joseph M. Tucci

    954                

 Fair Value

  $190,027          

 

(3)

The aggregate number of Motorola Solutions DSU awards outstanding at December 31, 2021 includes accrued dividend equivalents or shares, and is shown below:

 

 

  Directors

 

 

 

    Deferred Stock Units    

 

  Kenneth D. Denman

 

  3,830

  Egon P. Durban

 

17,970

  Clayton M. Jones

 

12,961

  Judy C. Lewent

 

  5,407

  Gregory K. Mondre

 

18,293

  Joseph M. Tucci

 

  8,150

 

(4)

Non-employee directors are covered by insurance that provides accidental death and dismemberment coverage of $500,000 per person. The spouse of each such director is also covered by such insurance when traveling with the director on business trips for the Company. The Company pays the premiums for such insurance. The total premiums for coverage of all such non-employee directors and their spouses during the year ended December 31, 2021 were approximately $942.

 

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Director Stock Ownership Guidelines

Our Board stock ownership guidelines provide that non-employee directors are expected to own Common Stock with a value equivalent to at least five times the annual cash retainer fee for directors within five years after the date of joining the Board. In addition, directors are required to hold all shares paid or awarded by the Company until their termination of service. For the purposes of these guidelines, Common Stock includes DSUs. As of December 31, 2021, all non-employee directors were in compliance with the stock ownership guidelines.

 

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OUR COMPANY

 

 

WHO WE ARE

Organization of our Business

As a global leader in public safety and enterprise security, we manage our business across three major technologies: LMR Communications, Video Security and Access Control and Command Center Software. We have invested across these three technologies, evolving our land mobile radio focus to purposefully integrate software, video security and access control solutions for public safety and enterprise customers globally. Our strategy is to generate value through the integration of each technology into our ecosystem, uniting voice, software, video security, access control and analytics to interoperate. While each technology individually strives to make users safer and more productive, we believe we can enable better outcomes for individuals, businesses and agencies when we unite these technologies as one connected system. With our technology ecosystem, our goal is to help remove silos between systems, unify data, streamline workflows, simplify management and support evolving technologies. Across all three technologies, we offer cloud-based solutions, cybersecurity services and managed and support services.

An example of our integrated technology ecosystem in action is when our municipal governmental agency customers leverage communications, video security, analytics and cloud-based software to understand what is happening across their cities, which we believe helps to improve community collaboration and overall safety. Video security and access control solutions help users identify and understand events, find lost people and protect property. Command center software informs and assists emergency response by unifying data across the 911 workflow, including call handling, dispatch, video analytics, field reporting, records, evidence and community input. Voice and data communications connect law enforcement, fire and emergency services from different agencies and jurisdictions in an effort to improve coordination and collaboration. The end-to-end integration of these technologies assists agencies in detecting, analyzing, communicating and responding to incidents.

Our Corporate Values & Human Capital Management

At Motorola Solutions, we have a “people first” philosophy and are guided by our corporate values every day - inclusive, innovative, passionate, driven, accountable and partners. These corporate values are the fundamental beliefs that define us, guiding how we do business and the decisions we make. We are committed to a supportive, fair and equitable environment where employees feel engaged, connected to our business and invested in the collective success of our customers and communities. In 2021, we added “inclusive” as one of our corporate values, to further strengthen our commitment to fostering a culture where fairness and belonging are core to our business.

As our driving force, our approximately 18,700 employees are drawn from all segments of our global society to make a difference for our customers. We invest in their development and training at all levels, challenging them to develop and grow skills to imagine new opportunities that will keep making a difference to public and enterprise safety.

We are driving operational changes to continuously support and promote mutual objectives of both our employees and the company, enhancing our culture and impacting business results – from our hiring practices to how we interact with our customers and suppliers.

We believe our senior leadership team, whose biographies are presented below, has the experience necessary to effectively execute our strategy, maintain our corporate values and advance our technology leadership. Our Chief Executive Officer and senior management leaders have extensive industry experience and are supported by a talented management team, committed to running our business ethically, responsibly and as a good corporate citizen to the communities in which we live and serve.

 

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OUR LEADERSHIP TEAM

Our Chief Executive Officer’s team, the management Executive Committee, is comprised of the following six individuals as of March 31, 2022:

 

 

MARK HACKER

 

  

 

Mr. Hacker is Executive Vice President, General Counsel and Chief Administrative Officer of Motorola Solutions. He leads the Company’s legal, government affairs and human resources teams. Mr. Hacker is a member of both the Illinois and Pennsylvania state bars, has been a certified public accountant, and has served as an adjunct professor at Northwestern University School of Law. Mr. Hacker serves as the President and is on the board of directors of the Motorola Solutions Foundation. Mr. Hacker is also President of the board of directors of the 100 Club of Illinois and serves on the board of directors of Business Executives for National Security, Skills for Chicagoland’s Future and St. Rita of Cascia High School in Chicago. He is also a member of the President’s Advisory Council of Villanova University.

 

Previous Experience

 

Senior Vice President and General Counsel, Motorola Solutions, overseeing legal, government affairs, global marketing, communications and the Motorola Solutions Foundation; Corporate Finance Associate, Buchanan Ingersoll & Rooney; Accountant, Arthur Andersen.

 

Education

 

Mr. Hacker earned a bachelor’s degree in accountancy from Villanova University and a law degree from Villanova University School of Law.

LOGO

 

 

Executive Vice President, General Counsel and Chief Administrative Officer

 

Joined Motorola

Solutions: 2001

Age: 50

 

  

 

 

 

JACK MOLLOY

 

  

 

Mr. Molloy is Executive Vice President and Chief Operating Officer for Motorola Solutions. He leads the Company’s worldwide sales and services organization and product development of land mobile radio and video security and access control. Mr. Molloy serves on the Sales Benchmark Index Advisory Board.

 

Previous Experience

 

Executive Vice President, Products and Sales, overseeing worldwide sales and product development for land mobile radio and video security and access control; Executive Vice President, Worldwide Sales & Services, overseeing global sales, systems integration and managed and support services.

 

Education

 

Mr. Molloy earned a bachelor’s degree in marketing from Northern Illinois University and a master’s degree in business administration from Loyola University.

 

LOGO

 

Executive Vice President and Chief Operating Officer

 

 

Joined Motorola

Solutions: 1994

Age: 50

 

 

 

 RAJAN NAIK

  

 

Dr. Naik is Senior Vice President, Strategy and Ventures, for Motorola Solutions. He is responsible for the corporate strategy organization, M&A and venture capital portfolio and competitive and market intelligence. Dr. Naik serves on the board of directors for CSG Systems International.

 

Previous Experience

 

Senior Vice President and Chief Strategy Officer, Advanced Micro Devices; Partner, Technology/Media/Telecom, McKinsey & Company.

 

Education

 

Dr. Naik earned a bachelor’s degree in engineering from Cornell University and a doctorate in engineering from the Massachusetts Institute of Technology.

 

LOGO

 

 

Senior Vice President, Strategy and Ventures

 

 

Joined Motorola

Solutions: 2015

Age: 50

    

 

 

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 MAHESH SAPTHARISHI

  

 

Dr. Saptharishi is Executive Vice President and Chief Technology Officer for Motorola Solutions, a role in which he has served since November 2021. He is responsible for command center software, mobile video solutions, cybersecurity and unified communications, and leads the chief technology office. Dr. Saptharishi serves on the board of directors for Evolv Technologies Holdings, Inc.

 

Previous Experience

 

Senior Vice President, Software Enterprise and Mobile Video, and Chief Technology Officer; Chief Technology Officer & Senior Vice President, Software Enterprise; Senior Vice President, Chief Technology Officer; Chief Technology Officer, Senior Vice President of Avigilon. Prior to Avigilon, Dr. Saptharishi founded VideoIQ, a video analytics company that was acquired by Avigilon, as well as Broad Reach Security, which was later acquired by GE.

 

Education

 

Dr. Saptharishi earned a bachelor of science and a master of science degree in electrical and computer engineering, and a doctoral degree in artificial intelligence, from Carnegie Mellon University.

 

LOGO

 

Executive Vice President and Chief Technology Officer

 

 

Joined Motorola

Solutions: 2019

Age: 44

    

 

 

 JASON WINKLER

  

 

Mr. Winkler is Executive Vice President and Chief Financial Officer for Motorola Solutions, a role in which he has served since July 1, 2020. He is responsible for the Company’s financial strategy and leads all financial functions as well as supply chain operations, procurement and information technology. Mr. Winkler is a member of the executive board of the Chicago Police Memorial Foundation.

 

Previous Experience

 

Senior Vice President, Finance; Corporate Vice President, Finance, Global Sales & Services; and Vice President and Director, North America, each for Motorola Solutions. Since joining the Company in 2001, Mr. Winkler has held a number of financial leadership positions supporting investor relations, global channel management, mergers and acquisitions and product operations.

 

Education

 

Mr. Winkler earned a bachelor’s degree in business administration from Valparaiso University and a master’s degree in business administration from the University of Chicago’s Booth School of Business.

 

LOGO

 

Executive Vice President and Chief Financial Officer

 

 

Joined Motorola

Solutions: 2001

Age: 48

    

 

 

 CYNTHIA YAZDI

  

 

Ms. Yazdi is Senior Vice President, Communications & Brand for Motorola Solutions. She is responsible for supporting the Chairman and CEO of Motorola Solutions and for global communications and brand for the Company, as well as the Motorola Solutions Foundation. Ms. Yazdi serves on the board of the American Red Cross of Chicago.

 

Previous Experience

 

Senior Vice President, Chief of Staff, Marketing and Communications and Motorola Solutions Foundation. Ms. Yazdi has held a variety of leadership positions in strategy and operations roles during her 20+ year career with the Company. Prior to her role as Chief of Staff, she led product and business operations for the Asia Pacific and Middle East regions.

 

Education

 

Ms. Yazdi earned a bachelor’s degree in civil engineering from Concordia University.

 

LOGO

 

Senior Vice President, Communications & Brand

 

 

Joined Motorola

Solutions: 2000

Age: 57

    

 

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PROPOSAL NO. 2 — RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2022

 

 

The Audit Committee of the Board has appointed PricewaterhouseCoopers LLP (“PwC”) as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2022. PwC has acted in this capacity since its appointment for 2019, following a competitive proposal process that took place in 2018. We are asking our shareholders to ratify the appointment of PwC as our independent registered public accounting firm. Although ratification is not required by our Bylaws or otherwise, the Board is submitting the appointment of PwC to our shareholders for ratification as a matter of good corporate governance.

Representatives of PwC are expected to be present at the Annual Meeting and will have the opportunity to make a statement if they desire to do so and will have the opportunity to respond to appropriate questions from shareholders. In the event shareholders do not ratify the appointment, the appointment will be reconsidered by the Audit Committee and the Board. Even if the appointment is ratified, the Audit Committee in its discretion may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company and our shareholders.

Services provided to the Company and its subsidiaries by PwC in fiscal years 2021 and 2020 are described under the section of the Proxy Statement on page 91 titled “Independent Registered Public Accounting Firm Fees.”

RECOMMENDATION OF THE BOARD AND THE AUDIT COMMITTEE

THE BOARD OF DIRECTORS AND THE AUDIT COMMITTEE UNANIMOUSLY RECOMMEND A VOTE FOR RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2022. UNLESS OTHERWISE INDICATED ON YOUR PROXY, YOUR SHARES WILL BE VOTED FOR THE RATIFICATION OF PRICEWATERHOUSECOOPERS LLP.

 

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OUR PAY

 

 

 

PROPOSAL NO. 3 — ADVISORY APPROVAL OF THE COMPANY’S EXECUTIVE COMPENSATION

 

In accordance with Section 14A of the Securities Exchange Act of 1934 (“Exchange Act”), we are providing our shareholders with the opportunity to vote to approve, on a non-binding, advisory basis, the compensation of our Named Executive Officers (“NEOs”) as disclosed in this Proxy Statement. The Board has adopted a policy providing for annual “say on pay” advisory votes. Although the vote is non-binding, the Board and Compensation and Leadership Committee will review and consider the outcome of the vote when considering future executive compensation arrangements. In deciding how to vote on this proposal, the Board encourages you to read the CD&A section of this Proxy Statement below for a detailed description of our executive compensation philosophy and programs. In particular, you should consider the following factors, which are more fully discussed in the CD&A:

 

     

We actively engage our shareholders on their views and consider this input when designing our executive compensation programs.

 

     

Our programs are designed to pay-for-performance, so a majority of the NEOs’ total compensation is based on the performance of the Company and 100% of their annual long-term incentives are performance-based.

 

     

Our executive compensation program incorporates many leading practices to ensure ongoing good governance, including a “clawback” policy, anti-hedging, stock ownership guidelines and no excise tax gross-ups.

For the reasons discussed above, the Board unanimously recommends that shareholders vote in favor of the following resolution:

“Resolved, that the shareholders approve, on an advisory basis, the compensation of the named executive officers as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including in the Compensation Discussion and Analysis, the compensation tables and other related disclosures in this Proxy Statement.”

RECOMMENDATION OF THE BOARD

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE ADVISORY APPROVAL OF THE COMPANY’S EXECUTIVE COMPENSATION. UNLESS OTHERWISE INDICATED ON YOUR PROXY, YOUR SHARES WILL BE VOTED FOR THE ADVISORY APPROVAL OF THE COMPANY’S EXECUTIVE COMPENSATION.

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

 

   

Say on Pay Vote Results and Shareholder Engagement

 

    

 

38

 

 

 

Historical Say on Pay Results

     38  

2021 Shareholder Engagement

     38  

Board Responsiveness to Say on Pay Vote

 

    

 

38

 

 

 

   

Executive Summary

 

    

 

39

 

 

 

Named Executive Officers

     39  

Management Transition

     39  

Our Business

     39  

Company Performance

     40  

Paying for Performance

     40  

Evolution of Our CEO’s Pay Program

 

    

 

48

 

 

 

   

Process for Determining Executive Compensation

 

    

 

49

 

 

 

Compensation Philosophy

     49  

Compensation Objectives

     50  

Sound Governance Practices

     51  

Evolution of Our Executive Compensation Program

     52  

How We Plan Compensation

     52  

Performance-Based Compensation Structure

     53  

2021 Target Total Compensation Summary

 

    

 

53

 

 

 

   

2021 Annual Compensation Elements

 

    

 

54

 

 

 

Base Salary

     54  

Short-Term Incentives

     54  

Long-Term Incentives

 

    

 

55

 

 

 

   

Comparative Market Data

 

    

 

56

 

 

 

2021 Peer Group

     56  

Survey Market Data

 

    

 

57

 

 

 

   

Equity Usage Under Our Compensation Programs

 

    

 

57

 

 

 

Other Compensation Policies and Practices

 

    

 

58

 

 

 

Benefits and Perquisites

     58  

Stock Ownership Guidelines

     58  

Change in Control Policy

     59  

Recoupment of Incentive Compensation Awards Upon Restatement of Financial Results

     59  

Impact of Favorable Accounting and Tax Treatment of Compensation Program Design

     60  

Anti-Hedging Policy

 

    

 

60

 

 

 

 

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SAY ON PAY VOTE RESULTS AND SHAREHOLDER ENGAGEMENT

HISTORICAL SAY ON PAY RESULTS

The Compensation and Leadership Committee (the “Committee”) strives to ensure our executive compensation program aligns with the interests of our shareholders and adheres to our pay-for-performance philosophy. Our executive compensation program, in place since 2015, has historically received very strong shareholder support. After a low level of support in 2018, we took concrete steps to understand and respond to our shareholders’ concerns. Our shareholders appreciated the level of direct responsiveness, which resulted in approximately 92% shareholder support for each of our 2019 and 2020 say on pay (“SOP”) votes. Our SOP vote received approximately 89% shareholder support in 2021.

 

         

 

PROXY  

 

 

2017

 

 

2018

 

 

2019

 

 

2020

 

 

2021

         

SOP RESULT  

 

95.6%

 

69.1%

 

92.3%

 

91.8%

 

89.4%

2021 SHAREHOLDER ENGAGEMENT

Consistent with prior years, our shareholder engagement process in 2021 was comprehensive and continuous. Our efforts included monitoring trends, seeking input on pay practices and corporate governance, and engaging investors and shareholder groups on pay topics as well as our ESG, operational and financial performance matters. We conduct targeted outreach efforts twice a year with our largest shareholders.

Every year, our shareholders’ perspective is a critical input considered by the Committee for reviewing our pay programs and determining executive compensation. Our outreach efforts in 2021 included:

 

     

Spring: followed up with our top 25 shareholders from early 2021 (approximately 55% ownership) to collect feedback

 

     

Fall/Winter: offered to engage with our top 25 shareholders (approximately 57% ownership) to hear their perspectives

Recent examples over the past few years of enhancements to our governance practices that have reflected feedback from our shareholders include creating a diversity, equity and inclusion (“DEI”) website that includes, among other items, diversity data for our employees by gender and race; adopting a proxy access provision in our Bylaws; reinforcing our pay-for-performance philosophy through the enhanced design of our incentive compensation programs; and emphasizing our commitment to high standards and ethics and accountability when participating in the political process through additional public disclosure of our controls, procedures, and oversight efforts.

BOARD RESPONSIVENESS TO SAY ON PAY VOTE

After our SOP vote in 2018, our shareholders provided consistent feedback on how to improve aspects of our CEO’s pay and specific incentive program features. Based on this feedback, we made several changes in 2018, which continue:

 

     

Eliminated cash from CEO long-term incentives by paying any active Long Range Incentive Plan (“LRIP”) cycles in stock and, beginning in 2019, denominating future LRIP cycles in the form of performance stock unit (“PSU”) equity grants

 

     

Increased CEO stock ownership requirement from 6x to 10x base salary

 

     

Disclosed CEO goals and achievement level as it relates to pay decisions, and as reviewed by the Board

 

     

Removed the 25% cap on the Committee’s ability to reduce a payout under the LRIP and performance options (“POs”) when total shareholder return (“TSR”) is negative, thus providing the Committee with full discretion to decrease the payout

Overall, feedback from our shareholders has been positive, recognizing the significant level of Board responsiveness to shareholder views on compensation, the strength of our management team and their continued support of our performance-based programs.

 

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EXECUTIVE SUMMARY

NAMED EXECUTIVE OFFICERS

Our Compensation Discussion and Analysis (the “CD&A”) describes the Company’s executive compensation philosophy and programs, which are governed by the Committee. The CD&A includes 2021 total compensation for our Named Executive Officers (“NEOs”) who are listed below. Included in our NEOs for 2021 and whose compensation is described in this CD&A is Kelly Mark, our former Executive Vice President, Software and Services. Refer to “Management Transition” below for additional information.

 

LOGO     

GREGORY Q. BROWN

 

Chairman and Chief Executive Officer

  LOGO     

MARK S. HACKER

 

Executive Vice President, General Counsel & Chief Administrative Officer

     
LOGO     

JASON J. WINKLER

 

Executive Vice President and Chief Financial Officer

  LOGO     

MAHESH SAPTHARISHI

 

Executive Vice President and Chief Technology Officer

     
LOGO     

JOHN P. MOLLOY

 

Executive Vice President and Chief Operating Officer

   

MANAGEMENT TRANSITION

On June 1, 2021, we announced that Kelly S. Mark, Executive Vice President, Software and Services, decided to step down from his position leading the software and services segment of the Company and retire from the Company effective December 31, 2021. Mr. Mark remained employed by the Company as Executive Vice President from June 1, 2021 until his retirement on December 31, 2021 to ensure a smooth transition.

OUR BUSINESS

Motorola Solutions is a global leader in public safety and enterprise security. Our technology platforms in Land Mobile Radio Communications (“LMR” or “LMR Communications”), Video Security and Access Control and Command Center Software, bolstered by managed and support services, create an integrated technology ecosystem to help make communities safer and businesses stay productive and secure. We serve more than 100,000 public safety and commercial customers in over 100 countries and have a rich heritage of innovation focusing on advancing global safety for more than 90 years.

 

 

 

    KEY SOLUTIONS

 

       

 

 

 

LOGO

 

   

 

 

LOGO

 

   

 

 

 

LOGO

 

LMR

Communications

 

     

Video Security

and Access Control

 

     

Command Center

Software

 

 

$8.2 BILLION

   

 

18,700+ EMPLOYEES

   

 

6,400+ PATENTS

         in annual sales (2021)

 

     

in 60 countries

 

     

granted

 

$734 MILLION

    100,000+ CUSTOMERS    

13,000 NETWORKS

in R&D spending (2021)

 

   

in over 100 countries

 

   

installed across the globe

 

 

HEADQUARTERS

 

 

 

CHAIRMAN and CEO

 

 

500 West Monroe Street

Chicago, IL USA

 

 

 

Greg Brown

 

 

 

Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement   39


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COMPANY PERFORMANCE

Our TSR significantly outperformed the S&P 500 in 2021, 62% compared to 29%, and over the past three years, 147% compared to 100%. Additionally, 2021 was a record year for other key financial metrics such as revenue, operating earnings, operating cash flow and ending backlog.

 

LOGO

   LOGO

When making compensation decisions, the Committee considers specific accomplishments in 2021, as well as how those accomplishments position us to execute against our growth and expansion strategy.

PAYING FOR PERFORMANCE

CEO Framework

Annually, individual performance objectives for Mr. Brown are established collaboratively with the Board and progress towards achieving such objectives is reviewed throughout the year. When determining Mr. Brown’s earned incentives and annual target compensation opportunities, the Board evaluates performance against four main categories:

 

     

Financial – revenue, earnings per share and dividends

 

     

Operational – backlog, customer experience and key litigation

 

     

Long-Term Strategic Initiatives – expansion of product and service offerings, integrated solutions and acquisitions

 

     

People – organizational optimization, DEI achievements, talent development and succession planning

Specific accomplishments considered for 2021 with respect to these categories are listed in the “CEO Individual Performance” section of this Proxy Statement on page 41.

In recognition of the dynamic and broad-based range of Mr. Brown’s responsibilities, we do not assign a specific weight to each category. The individual performance categories do, however, reflect the Committee’s perspective that both current year results, as well as the quality of the foundation laid for future growth, are equally worthy of consideration. Additionally, the Committee reviews the momentum of the business – multiple year trajectory of key metrics – when reviewing Mr. Brown’s performance. As a result, for example, the Committee looks at annual revenue and earnings growth as well as multi-year trends of these metrics, while also focusing on the Company’s execution of pivotal acquisitions, diversity, equity and inclusion efforts and the attraction of critical talent to the Company’s growth areas.

Short-Term Incentive Plan Results

The Executive Officer Short Term Incentive Plan (“STIP”) provides annual cash incentives to executives based on a combination of objective Company-wide financial performance targets and unique individual executive performance goals. Given the broad range of strategic activities necessary to execute the transformation of our business, the Company performance factor is multiplied by an individual performance factor (“IPF”) to reward our executives for accomplishments beyond strong financial results. The IPF is based on the Committee’s subjective and thorough review of each NEO’s individual performance throughout the year.

 

40   Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement


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Company-Wide Financial Performance and Compensation Changes in 2021

In 2021, we achieved approximately 98% of our operating plan for non-GAAP Operating Earnings (“non-GAAP OE”) and approximately 100% of our operating plan for Free Cash Flow, resulting in a Company performance factor of 0.96. Even with the continuing impacts of the COVID-19 pandemic, performance targets for 2021 remained aggressive, with only a 3% decrease in non-GAAP OE from our 2020 performance target and a 5% decrease in Free Cash Flow from our 2020 performance target.

 

             

 

  COMPANY

  PERFORMANCE

  MEASURE

 

 

MINIMUM

 

 

TARGET

 

 

MAXIMUM

 

 

2021

RESULT

 

 

COMPANY

PERFORMANCE

FACTOR

 

 

MEASURE

WEIGHT

 

 

WEIGHTED

RESULT

 

             

  Non-GAAP OE1 (in millions)

$1,935 $2,150 $2,365 $2,117 0.94 65% 0.61
             

  Free Cash Flow2 (in millions)

$1,440 $1,600 $1,840 $1,594 1.00 35% 0.35
             

  TOTAL

0.96

 

1 

Non-GAAP OE is our reported GAAP Operating Earnings excluding share-based compensation expenses, reorganization of business charges, intangible assets amortization expenses, tangible and intangible asset impairments, certain non-cash pension adjustments, legal settlements and other contingencies, gains and losses on investment and businesses, Hytera-related legal expenses, the income tax effects of significant tax matters, and acquisition-related transaction fees.

2 

Free Cash Flow is a non-GAAP financial measure and is calculated as net cash provided by operating activities less capital expenditures.

CEO Individual Performance

The Committee uses the IPF in the STIP to capture key qualitative and quantitative objectives important to the execution of annual contributions to our long-term strategies. Mr. Brown’s IPF incorporates both his individual accomplishments and his role in supporting the accomplishments of his leadership team, for which he is accountable.

Mr. Brown’s 2021 IPF of 1.4 was derived from his accomplishments under the “CEO Framework” section described above. Highlights from his accomplishments in each category are provided in the table below.

 

  2021 ACCOMPLISHMENT HIGHLIGHTS

FINANCIAL

 

 

   Achieved revenue growth of 10% to $8.2 billion, a Company record

 

   Achieved Products and Systems Integration revenue growth of 9% to $5 billion

 

   Achieved Software and Services revenue growth of 13% to $3.1 billion, a Company record, resulting in the segment generating 38% of Company revenue and 54% of non-GAAP OE

 

   Achieved Video Security and Access Control revenue growth of 32% to $1.2 billion, a Company record

 

   Achieved non-GAAP OE growth of 15% to $2.1 billion, a Company record

 

   Achieved operating cash flow growth of 14% to $1.8 billion, a Company record

 

OPERATIONAL

 

 

   Achieved backlog growth of 19% to $13.6 billion, a Company record

 

   Repatriated $527 million of capital to the U.S.

 

   Increased patent portfolio by 300 to 6,400 granted patents

 

   Won legal actions against China-based Hytera increasing total civil judgment to approximately $670 million

 

LONG-TERM STRATEGIC INITIATIVES

 

 

   Launched 30 major products, including:

 

¡  MOTOTRBO Ion, next generation PCR device

 

¡  APX NEXT XN, next generation firefighter device

 

¡  M500, next-generation AI-enabled in-car video system

 

¡  L5M, next generation mobile ALPR detection camera

 

¡  WAVE PTX, mission-critical push-to-talk for public safety

 

¡  CommandCentral Suite, public safety’s first cloud-native 911 call-to-case closure solution

 

¡  Smart Transcription and Citizen Input for 911

 

¡  Openpath Video Recorder Pro, high-resolution camera with door reader form factor

 

¡  Avigilon AI Network Video Recorder, adding AI capabilities to connected video streams

 

   Closed approximately $500 million in acquisitions, strengthening our Video Security and Access Control and Command Center Software solutions

 

 

Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement   41


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  2021 ACCOMPLISHMENT HIGHLIGHTS

PEOPLE

 

 

   Added “Inclusive” to Company values

 

   Implemented DEI employee training, launched DEI webpage to provide greater transparency, held DEI listening sessions with 1,200 employees and developed global DEI action plans

 

   Appointed seven new diverse vice presidents, increasing U.S. vice president diversity to 41% versus 38% in 2020

 

   Conducted successful virtual internship program for 230 participants, increasing intern diversity to 69% from 67% in 2020

 

   Hired 3,070 new employees and acquired 270 new employees

 

   Achieved employee volunteering growth of 60% to nearly 65,000 hours, a Company record

 

   Successfully navigated COVID-19 response and federal vaccination mandates

 

   Earned several recognitions including:

 

¡  World’s Most Admired Companies (Fortune)

 

¡  America’s Best Large Employers (Forbes)

 

¡  Management Top 250 (The Wall Street Journal)

 

¡  100 Best Workplaces for Innovators (Fast Company)

 

¡  Corporate Equality Index (Human Rights Campaign)

 

¡  America’s Best Employers for Diversity (Forbes)

 

¡  Top 100 U.S. Internship Programs (WayUp)

 

¡  100 Best ESG Stocks (Investor’s Business Daily)

 

¡  Best Places to Work (Disability Equality Index)

 

¡  America’s Most Responsible Companies (Newsweek)

 

In sum, the Committee has determined that Mr. Brown’s performance warrants application of a 1.4 IPF with respect to his STIP payout.

Other NEO Individual Performance

Other NEO individual performance objectives coalesce with Mr. Brown’s objectives, as set by the Board. Mr. Brown evaluated the other NEOs’ individual performance based primarily, but not exclusively, on the same categories in the CEO framework and made the following recommendations which were approved by the Committee.

 

42   Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement


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The below table includes highlights from each NEO’s many accomplishments that contributed to the Company’s success in 2021. For the purposes of this table, accomplishments have been ascribed to a specific category, though many of them impact multiple categories.

 

 

 
  IPF   FINANCIAL AND OPERATIONAL   LONG-TERM STRATEGIC INITIATIVES   PEOPLE
  WINKLER   1.4  

  Mitigated COVID-19 pandemic-related supply chain disruptions to achieve record non-GAAP OE and operating cash flow, including:

 

¡  Grew non-GAAP OE 15% to $2.1 billion with 19% growth in Software and Services and 11% growth in Products and Systems Integration

 

¡  Grew operating cash flow 14% to $1.8 billion

 

  Established $2.25 billion 5-year revolving credit facility with improved pricing and terms

 

  Issued $850 million of 2.75% 10-year debt and redeemed $324 million of 3.50% senior notes

 

  Repatriated $527 million of capital to the U.S., increasing U.S. cash to 70% of total, further centralizing liquidity

 

  Enhanced investor relations, revamping investor presentation narrative, establishing new communication channel with CFO and launching quarterly newsletter for investors

 

  Implemented enhanced forecasting models incorporating dynamic demand and supply environment

 

  Optimized supply chain footprint with consolidation of four supply chain locations to state-of-the-art facility in Texas

 

  Reduced global pension funding deficit to less than $1 billion

 

  Increased quarterly dividend 11%

 

  Led comprehensive portfolio review and pricing updates

 

  Deployed new subscription management tools to support growing recurring revenue lines of business

 

  Launched e-commerce platforms for LMR and Video Security and Access Control

 

  Enhanced information security readiness by:

 

¡  Launching employee awareness campaign

 

¡  Implementing employee training and phishing programs

 

¡  Leading security incident tabletop exercise

 

  Expanded use of automation and digitization in audit function to drive enhanced sampling and continuous monitoring

 

  Restructured and expanded organization to include CIO and IT teams

 

  Led significant talent refresh and development, hiring over 550 employees and hosting 44 interns from 15 countries

 

  Continued to drive DEI programs including leadership listening sessions, DEI training, DEI recruiting and pay equity assessments

 

  Performed extensive compensation analyses and implemented new rewards strategies to strengthen retention of high performers

 

  Transitioned over 200 employees to new Texas facility

 

  Continued to integrate and leverage centers of excellence for efficiency and talent development

 

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  IPF   FINANCIAL AND OPERATIONAL   LONG-TERM STRATEGIC INITIATIVES   PEOPLE
  MOLLOY   1.4  

  Grew revenue 10%

 

  Grew backlog 19%

 

  Achieved record revenue for LMR systems integration

 

  Achieved record revenue for services

 

  Achieved record revenue for Video Security and Access Control

 

  Achieved $130 million in APX NEXT device orders

 

  Mitigated pandemic-related supply chain constraints through product redesigns

 

  Launched 50 new LMR products

 

  Launched 80 fixed video and access control products

 

  Launched Safety Reimagined partner program, expanding reach of our unified voice, data, video and analytics platform

 

  Launched Orchestrate, simplified cloud-based business workflow automation tool

 

  Transitioned Video Security and Access Control supply chain operations to state-of-the-art facility in Texas

 

  Acquired and integrated Openpath and Envysion to expand Video Security and Access Control portfolio

 

  Restructured and expanded organization to include global services, software sales and digital and field marketing teams

 

  Expanded hiring from underrepresented groups, increasing U.S. diversity by 3%

 

  Increased investment in rewards and development programs designed for talent retention

 

  Continued to drive DEI programs including leadership listening sessions, DEI training, DEI recruiting and pay equity assessments

 

  Sponsored programs designed to support the mental health and wellness of employees, including “The Energy Project” to address employee burnout by providing tools and techniques for managing time and energy

 

44   Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement


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  IPF   FINANCIAL AND OPERATIONAL   LONG-TERM STRATEGIC INITIATIVES   PEOPLE
  HACKER   1.4  

  Led comprehensive COVID-19 pandemic response plan to keep our employees safe and support our customers while ensuring compliance with applicable federal, state and local vaccination mandates

 

  Supported completion of key strategic acquisitions and venture capital investments

 

  Successfully advocated for legislative and regulatory outcomes that supported public safety and law enforcement at the federal, state, and local levels

 

  Continued successful execution of our global offensive litigation strategy to protect our innovation and defend our intellectual property rights, including:

 

¡  Multiple victories against Hytera for trade secret misappropriation and copyright infringement, increasing total civil judgment to approximately $670 million

 

¡  Launch of patent infringement litigation against Verkada in the U.S. International Trade Commission

 

  Strengthened ESG governance and transparency including enhanced corporate responsibility report, expanded climate and DEI initiatives, and training for employees and suppliers

 

  Continued evolution of patent portfolio to increase software and video patents, now representing 45% of patent portfolio

 

  Strengthened DEI culture, governance, and transparency through:

 

¡  Development of DEI global strategic plan

 

¡  Launch of DEI action plans tailored to each Executive Committee member’s organization

 

¡  Creation of DEI advisory council

 

¡  Launch of first-ever DEI webpage setting forth DEI commitment and workforce demographics

 

¡  Launch of mandatory DEI training for all employees

 

¡  Hosting of 63 DEI listening sessions with 1,200 employees

 

¡  Hosting of 15 diversity recruiting sessions with 1,000 employees

 

  Launched new performance management process to align goals with company values and enhance employee feedback

 

  Achieved Top 100 Internship Program award for fourth consecutive year

 

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  IPF   FINANCIAL AND OPERATIONAL   LONG-TERM STRATEGIC INITIATIVES   PEOPLE

  SAPTHARISHI

  1.4  

  Integrated cyber monitoring services into LMR and Command Center Software offerings

 

  Mobile Video

 

¡  Exceeded annual sales plan

 

¡  More than doubled body-worn camera orders, including French MOI, the largest body-worn camera order to date

 

¡  Year-over-year increase in mix of as-a-service mobile video orders

 

  Command Center Software

 

¡  Grew revenue 10%

 

¡  Expanded the number of customers utilizing two or more of our solutions to over 600 customers

 

¡  Created a path to the cloud for on-premises customers and expanded cloud adoption

 

¡  Initiated hybrid offer with subscription offerings for software suite, including on-premises or cloud-based offerings

 

¡  Increased the average population of people served by Next Generation 911 call routing by over 40% year-over-year

 

¡  2x sales growth expansion of subscription-based offerings

 

¡  Grew video software 39%, which was the fastest growing portion of our software revenue in 2021

 

  Launched cloud native CommandCentral Suite with innovative user experience across entire incident workflow

 

  Launched CommandCentral Evidence with unified search, modern evidence viewer, automated transcription and judicial sharing

 

  Launched WAVE PTX for public safety and incorporated streaming video into mission-critical push-to-talk capabilities

 

  Launched M500, first AI-enabled in-car video system

 

  Launched L5M, next generation mobile ALPR detection camera

 

  Developed improved AI capabilities for fixed video product portfolio

 

  Developed high performance and scalable next generation ALPR engine

 

  Acquired 911 Datamaster to further supplement our Command Center Software subscription offerings

 

  Restructured organization and leadership team, including addition of strong external talent

 

  Continued to drive DEI programs including leadership listening sessions, DEI training, DEI recruiting and pay equity assessments

 

  Launched successful mentor program with 470 employees participating and 2,550 hours logged

  MARK

  1.0  

  Successfully led the Software and Services organization through his retirement announcement on June 1, 2021. Mr. Mark helped achieve Software and Services revenue growth of 13% to $3.1 billion, a Company record, and he assisted with a seamless leadership transition to Dr. Saptharishi.

 

46   Motorola Solutions Notice of 2022 Annual Meeting of Shareholders and Proxy Statement


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2021 NEO Short-Term Incentive Payouts

As detailed earlier, the Committee assessed and determined that Mr. Brown and the other NEOs largely exceeded their qualitative and quantitative individual performance objectives. To recognize and reward these achievements, the Committee has approved the following IPFs and total STIP payouts.

 

           
  NEO ELIGIBLE
   EARNINGS(1)  
STIP
  TARGET (%)  
COMPANY
  PERFORMANCE  
FACTOR
INDIVIDUAL
  PERFORMANCE  
FACTOR
STIP
  AWARD ($)  
AWARD AS
  % OF TARGET  
           

 BROWN

$1,250,000 175% 0.96 1.40 $2,940,000 134%
           

 WINKLER

$650,962 95% 0.96 1.40 $831,148 134%
           

 MOLLOY

$768,269 95% 0.96 1.40 $980,926 134%
           

 HACKER

$666,346 95% 0.96 1.40 $850,791 134%
           

 SAPTHARISHI2

$482,308 77% 0.96 1.40 $501,795 134%
           

 MARK

$620,192 95% 0.96 1.00 $565,615 96%

 

  1

Eligible earnings consists of the base salary earned during the performance period from January 1 through December 31.

  2 

Dr. Saptharishi’s STIP target (%) was prorated due to his promotion to the position of Executive Vice President and Chief Technology Officer, and his corresponding compensation changes with respect to such promotion, on November 18, 2021. Dr. Saptharishi’s STIP target (%) from January 1 to November 17, 2021 was 75% and increased to 95% effective November 18, 2021.

Long-Term Incentive Plan Results

Our annual long-term incentive program (“LTI”) is 100 percent performance-based and provides awards in the form of PSUs, POs and market stock units (“MSUs”), which are earned based on either relative TSR (in the case of PSUs and POs) or change in absolute stock price (in the case of MSUs). The annual LTI not only rewards long-term stock price performance, but also ensures that our TSR outperforms the median of the S&P 500 in order to receive a target payout.

 

Long Range Incentive Plan and Performance Options

 

The 2019-2021 LRIP cycle and POs granted in 2019 were earned based on
TSR relative to the S&P 500 over the three-year performance period.

 

MSI’s three-year cumulative TSR performance of 112.6% resulted
in a 79th percentile rank versus S&P 500 companies, with awards
earned at 175% of target.

 

TSR calculation is defined in the “2021 Annual Compensation Elements”
section below.

     

2019-2021 LRIP

 

 

 

POs
($138.64 exercise price)  

 

     
   

 

 

RELATIVE TSR PAYOUT SCALE (S&P 500) 

 

 

 
     

 

PERCENTILE RANK

 

 

 

PAYOUT

 

 

 

TSR

 

     
   

90th - 100th Percentile

 

  250%

 

  149.2%

 

 
   

80th - 89.99th Percentile

 

  200%

 

  114.2%

 

 
   

 

MSI (79th Percentile)

 

 

 

175%

 

  112.6%

 

 
   

70th - 79.99th Percentile

 

  175%

 

  87.1%

 

 
   

60th - 69.99th Percentile

 

  150%

 

  65.5%

 

 
   

55th - 59.99th Percentile

 

  110%

 

  56.9%

 

 
   

50th - 54.99th Percentile

 

  90%

 

  50.7%

 

 
   

45th - 49.99th Percentile

 

  80%

 

  42.3%

 

 
   

35th - 44.99th Percentile

 

  50%

 

  30.0%

 

 
   

30th - 34.99th Percentile

 

  30%

 

  23.7%

 

 
   

<30th Percentile

 

  0%

 

   

 

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Market Stock Units

One-third of the MSUs granted in 2018, 2019 and 2020 were earned in 2021 based on absolute stock price appreciation. These awards were earned at 172%, 128%, and 103% of target, respectively, with corresponding stock price appreciation.

 

Grant Date: March 8, 2018
3rd of 3 Tranches Earned on
March 8, 2021

 

  

 

 

Grant Date: March 22, 2019
2nd of 3 Tranches Earned on March 22, 2021

 

  

 

 

Grant Date: March 13, 2020
1st of 3 Tranches Earned on March 13, 2021

 

 

 

Beginning stock price: $105.04
Ending stock price: $180.62

 

  

 

Beginning stock price: $140.64
Ending stock price: $179.92

 

  

 

Beginning stock price: $174.73
Ending stock price: $179.97

 

 

PAYOUT = 172% OF TARGET

 

  

PAYOUT = 128% OF TARGET

 

  

PAYOUT = 103% OF TARGET

 

EVOLUTION OF OUR CEO’S PAY PROGRAM

This section outlines Mr. Brown’s compensation since Motorola Solutions became a publicly traded company in January 2011. Additional detail for each component of pay, including changes from 2020 to 2021, and the corresponding rationale, can be found in the “2021 Annual Compensation Elements” section below.

2011-2021 CEO Compensation

The Committee reviews Mr. Brown’s compensation in an effort to deliver a competitive, but responsible, target compensation package. Throughout Mr. Brown’s 14 years as CEO, the Committee has exercised its discretion to both increase and decrease Mr. Brown’s target compensation, as it has deemed appropriate. For a detailed description of Mr. Brown’s employment agreement, please refer to the section of this Proxy Statement on page 71 titled “Employment Contracts.”

Since 2011, the Committee has decreased Mr. Brown’s short-term cash compensation and increased his long-term compensation, resulting in a net increase of 67.8% over the 11 years. During this same time, Mr. Brown has guided the Company through a significant transformation and Motorola Solutions has delivered TSR of 792.5%.

 

       

 

   PAY COMPONENT

 

 

2011

 

 

2021

 

 

% CHANGE  

 

 

COMMENTS

 

       

  BASE SALARY

  $1,200,000   $1,250,000     4.2%    

 

In 2014, Mr. Brown’s base salary was increased by $50,000 by the Committee and he received an amended employment agreement, which lowered his target incentive to 150%, resulting in an 18.6% decrease to Target Total Cash. In 2018, the Committee increased Mr. Brown’s target incentive from 150% to 175%.

 

 

  STIP TARGET %

 

  220%   175%     -20.5%  

 

  TARGET TOTAL CASH

 

  $3,840,000   $3,437,500     -10.5%  
       

  LRIP

  $3,000,000   $4,916,666      63.9%     

 

Beginning with the performance cycle that ended in 2018, Mr. Brown has received his LRIP payouts in stock, thus eliminating cash from his LTI program. Beginning with the performance cycle that started in 2019, Mr. Brown’s LRIP has been denominated 100% in PSUs.

 

       

  EQUITY

  $4,000,000   $9,833,334      145.8%     

 

In 2015, the Committee replaced Mr. Brown’s stock options and restricted stock units (“RSUs”) (containing a stock price hurdle) with POs and MSUs, improving the long-term performance orientation of the program.

 

  TOTAL LTI

  $7,000,000   $14,750,000      110.7%   
       

  TARGET TOTAL

  COMPENSATION

  $10,840,000   $18,187,500     67.8%    

 

AVERAGE ANNUAL INCREASE

OVER ELEVEN YEARS IS 6.2%

 

 

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CEO Compensation vs. TSR

Over this 11-year period, Mr. Brown’s target compensation program has been managed to provide appropriate pay levels in relation to returns for our shareholders. An even stronger relationship holds true when considering Mr. Brown’s compensation as reported in the 2021 Summary Compensation Table on page 62 of this Proxy Statement, which, for years prior to 2021, is a mix of current year compensation and payouts related to prior years’ performance.

 

 

TARGET COMPENSATION VS. TSR

 

                

 

SUMMARY COMPENSATION TABLE VS. TSR  

   

LOGO

         

LOGO

CEO 2021 LTI Pay Decisions

The Committee and our Board recognize that the retention of highly qualified leaders is critical to the Company’s continued success. Mr. Brown is a highly experienced senior leader at our Company. He joined the Company in 2003 and served in several senior executive roles before becoming CEO in 2008. Through his visionary leadership as CEO, Mr. Brown has transformed the Company into a global leader in public safety and enterprise security. He has led the Company through the successful execution of key strategic initiatives that have positioned the Company for long-term success and, in doing so, has created significant value for shareholders. As in prior years, when evaluating Mr. Brown’s 2021 long-term incentive compensation, the Committee took into consideration the fact that the Company generated TSR of 173% over the 5-year period ended December 31, 2020, outperforming the S&P 500 index by 70 percentage points.

As the Committee and the Board looked ahead, they believed it to be in the best interests of our shareholders and critical to the Company’s path forward to retain Mr. Brown as CEO. The continuing impacts of the COVID-19 pandemic in 2021 further illuminated the key role that Mr. Brown plays at our Company. We are confident in Mr. Brown’s ability to continue to make strategic investments that strengthen our portfolio and grow our expanding businesses. As such, the Board determined to increase Mr. Brown’s 2021 long-term incentive opportunity 5% from $14.1 million in 2020 to $14.8 million.

The Committee and the Board believed limiting the increase only to Mr. Brown’s long-term incentive opportunity further aligned his interests with those of our shareholders, as his long-term incentive opportunity is 100% performance-based and tied to Motorola Solutions’ stock price performance, either on an absolute basis or relative to the S&P 500.

PROCESS FOR DETERMINING EXECUTIVE COMPENSATION

COMPENSATION PHILOSOPHY

Our executive compensation program design is guided by five key principles.

 

 

 

  PRINCIPLE

 

 

 

DESCRIPTION

 

 

 

  Business

 

 

Incentives are aligned with the Company’s business goals and avoid excessive risk-taking

 

 

 

  Performance

  Differentiated

 

 

Programs designed to create an effective link between pay and performance at both the Company and individual levels

 

 

  Market

  Competitive

 

 

Total compensation package is competitive to attract, retain and motivate top talent needed to successfully execute our business strategy

 

 

  Ownership

  Oriented

 

 

Compensation is aligned with shareholder interests by delivering meaningful equity awards and maintaining robust stock ownership guidelines

 

 

  Simplicity

 

 

Engagement is driven through simple, cost-efficient plan design

 

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COMPENSATION OBJECTIVES

We built our 2021 executive compensation program upon the following objectives:

 

LOGO

 

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SOUND GOVERNANCE PRACTICES

Our executive compensation program is aligned to our business strategy and incorporates strong governance.

 

 

WHAT WE DO

 

 

 

PRACTICE

 

     

 

MSI PRACTICE

 

 
 

 

Annual Shareholder Say on Pay

 

     

 

We seek an annual non-binding advisory vote from shareholders on our executive compensation

 

 
 

 

Robust Stock Ownership Guidelines

 

     

 

Executives are required to hold stock equal to 10x salary for CEO and 3x salary for other NEOs

 

 
 

 

Transparent Disclosure

 

     

 

Robust individual performance disclosure for STIP

 

 
 

 

Pay-for-Performance and Shareholder Alignment

 

     

 

Long-term incentive program for management team, including the NEOs, is 100% performance-based with respect to annual grants

 

 
 

 

Use of Independent Advisor

 

     

 

The Committee retains Compensation Advisory Partners LLC (“CAP”) to review Company compensation programs and practices

 

 

 

 

WHAT WE DON’T DO

 

 

 

PRACTICE

 

     

 

MSI PRACTICE

 

 
 

 

No Cash in NEO LTI Program

 

     

 

Beginning in 2021, NEO LTI was 100% performance-based equity

 

 
 

 

No Excise Tax Gross-ups

 

     

 

We do not provide tax gross-ups in connection with any perquisites or in the event of any “golden parachute payment” in connection with a change in control

 

 
 

 

No Excessive Perquisites

 

     

 

We do not provide excessive perquisites to our NEOs and believe that our limited perquisites are reasonable and competitive

 

 
 

 

No Hedging of Company Securities

 

     

 

Our Insider Trading Policy prohibits directors, officers and other designated employees from directly or indirectly holding securities tied to the performance of the Company other than our Common Stock and stock options delivered directly to employees under our option and incentive plans

 

 
 

 

No Single Trigger Severance in a Change in Control

 

     

 

In the event of a change in control, all severance pay components have a double trigger (subject to certain conditions)

 

 

 
 

 

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EVOLUTION OF OUR EXECUTIVE COMPENSATION PROGRAM

The below timeline illustrates our responsiveness to shareholder feedback and the evolution of our compensation program over the past several years.

 

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HOW WE PLAN COMPENSATION

Our compensation framework is based on sound program design principles, which allow for the flexibility to competitively, but responsibly, address the dynamic labor markets in which we compete. These programs have been designed to focus executives on the achievement of our long-term business plan and shareholder value creation. Our incentive plans utilize rigorous financial goals and, with respect to awards with relative TSR goals, require above median relative outperformance for target payouts, while incorporating risk-mitigating features, such as payout caps, to ensure we reward sustainable growth.

Over the years, our executive compensation program has evolved with our business strategy, incorporated feedback from our shareholders, and maintained market competitiveness to properly incent and reward our management team. Additionally, we conduct regular risk assessments of our compensation programs and practices and review results with the Committee at least annually.

When setting annual compensation for our NEOs, the Committee balances the current state of the business with setting the stage for the future. The Committee, with assistance from its independent advisor, CAP, considers peer company pay practices for comparable positions; NEO experience, tenure, scope of responsibility and performance; internal pay alignment; and succession planning. The Committee uses the 50th percentile of our peer group and surveys as an initial guideline for establishing target total compensation opportunities for our NEOs. For 2021, on average, our NEOs were between the market 50th and 75th percentiles, with the exception of our highly seasoned CEO.

The Committee engages CAP to advise on the Company’s executive compensation strategy and program design and to provide regulatory and market trend updates. CAP carries out competitive reviews as directed by the Committee and provides input on specific compensation recommendations for our CEO and other members of management’s Executive Committee.

In 2021, the Committee continued to engage CAP as its independent compensation consultant. CAP participates in Committee meetings, including regular discussions with the Committee, without management present, to ensure impartiality on certain decisions. During 2021, the Committee also reviewed CAP’s independence using assessment criteria that aligned with the SEC and related NYSE rules. The Committee concluded that CAP was independent and had no conflicts of interest.

 

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PERFORMANCE-BASED COMPENSATION STRUCTURE

The performance-based structure for 2021 incorporates incentives that measure both short-term and long-term performance. In addition to base salary and an annual STIP award, this structure, shown graphically below (with incentives shown at their target amounts), includes an annual LTI award made up of our LRIP (which, beginning with the 2021 performance cycle, is denominated 100% in PSUs for all NEOs), POs and MSUs. The Committee believes a majority of compensation should be in the form of LTI to better drive alignment with shareholder interests and executive retention.

 

 

LOGO

2021 TARGET TOTAL COMPENSATION SUMMARY

When setting NEO compensation, the Committee first determines target total compensation and second, determines each pay component in support of the appropriate aggregate value and mix.

 

     

  NEO

 

  BASE SALARY  

 

  TARGET  
STIP %

 

TARGET
  TOTAL CASH  

      

TARGET LTI(1)

      

TARGET TOTAL
  COMPENSATION  

 

YEAR-OVER
  YEAR CHANGE  

 

LRIP

 

PO/OPTION

 

MSU/RSU

       

  BROWN

 

$1,250,000

 

175%

 

$3,437,500

 

  $4,916,666  

 

  $4,916,667  

 

  $4,916,667  

 

$18,187,500

 

3.7%

       

  WINKLER

 

$675,000

 

95%

 

$1,316,250

 

$1,066,666

 

$1,066,667

 

$1,066,667

 

$4,516,250

 

96.8%2

       

   MOLLOY3

 

$775,000

 

95%

 

$1,511,250

 

$1,133,334

 

$1,133,333

 

$1,133,333

 

$4,911,250

 

5.8%

       

  HACKER

 

$675,000

 

95%

 

$1,316,250

 

$750,000

 

$750,000

 

$750,000

 

$3,566,250

 

7.1%

       

   SAPTHARISHI4

 

$600,000

 

95%5

 

$1,170,000

 

$327,171

 

$548,750

 

$746,250

 

$2,792,171

 

N/A

       

  MARK

 

$625,000

 

95%

 

$1,218,750

 

$838,334

 

$838,333

 

$838,333

 

$3,733,750

 

4.6%

 

  1

Options and RSUs in this “Target LTI” column apply solely to Dr. Saptharishi, who was not yet eligible for the 2021 LTI program at the time of grant (with respect to POs and MSUs). See also footnotes 4 and 5 below.

  2

Mr. Winkler’s year-over-year change is primarily due to his 2021 LTI, which is significantly greater than the LTI granted to him in 2020, the year of his promotion to Executive Vice President and Chief Financial Officer.

  3 

Mr. Molloy’s target LTI and target total compensation for 2021 excludes a recognition grant received in June 2021 for his leadership in the sales and services organization.

  4 

Table only reflects Dr. Saptharishi’s compensation as an NEO; therefore, the “Year-Over-Year Change” column is not applicable.

  5

Dr. Saptharishi’s target STIP % was prorated to 77% due to his promotion to the position of Executive Vice President and Chief Technology Officer, and his corresponding compensation changes with respect to such promotion, on November 18, 2021. Dr. Saptharishi’s target STIP % from January 1 to November 17, 2021 was 75% and increased to 95% effective November 18, 2021.

 

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2021 ANNUAL COMPENSATION ELEMENTS

BASE SALARY

As the only fixed compensation element in our program, base salary is used to provide what we believe to be a baseline level of stability required to be market competitive. Salaries are reviewed and adjusted by the Committee as needed. Annual increases are not guaranteed or automatic.

In March 2021, the Committee reviewed base salaries for our NEOs and applied market adjustments, where applicable. Mr. Brown has not received a base salary increase since 2014 and did not receive a base salary increase in 2021.

 

       
   NEO  

  2020 BASE  

  SALARY RATE  

 

  2021 BASE  

  SALARY RATE  

    YEAR-OVER-  
  YEAR CHANGE  
 

  2021 ACTUAL  

  SALARY  

     

  BROWN

 

$1,250,000

 

$1,250,000

 

0.0%

 

$1,250,000

     

  WINKLER

 

$550,000

 

$675,000

 

22.7%

 

$650,962

     

  MOLLOY

 

$740,000

 

$775,000

 

4.7%

 

$768,269

     

  HACKER

 

$630,000

 

$675,000

 

7.1%

 

$666,346

     

  SAPTHARISHI1

 

 

$600,000

 

N/A

 

$482,308

     

  MARK

 

$600,000

 

$625,000

 

4.2%

 

$620,192

  1

Dr. Saptharishi is an NEO because he was elevated to the Company’s Executive Committee on June 1, 2021 and promoted to Executive Vice President and Chief Technology Officer on November 18, 2021. Table only reflects Dr. Saptharishi’s compensation as an NEO.

SHORT-TERM INCENTIVES

The STIP is an annual cash incentive award based on the Company’s achievement of financial performance and an executive’s individual performance. The Committee sets the target value for STIP as a percentage of an executive’s base salary.

Incentive Targets

There were no changes to individual target award percentages in 2021. Our CEO, Mr. Brown, continued to have an individual target award percentage of 175%, and all other NEOs’ target percentages continue to be 95%.

Payout Formula

Actual STIP awards are based on the executive’s target incentive opportunity, the Company’s achievement of performance results (“Business Performance Factor”) and IPF assessment. The payout opportunity for both the Business Performance Factor and the IPF ranges from 0% to 140%, resulting in a total plan maximum payout opportunity of 196% of target. The incentive target opportunity for each NEO was determined based on a market evaluation.

 

 

LOGO

Metric Selection

For 2021, the Business Performance Factor was based on achievement of non-GAAP OE (weighted 65%) and Free Cash Flow (weighted 35%) goals. Non-GAAP OE measures our profits from sales and Free Cash Flow measures the cash available after capital expenditures. These are common performance measures both inside and outside of our industry and are fundamental inputs we use to measure profitability, business liquidity and rates of return for the business. We believe non-GAAP OE and Free Cash Flow appropriately measure our annual business performance and ultimately drive our long-term shareholder value over time.

 

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LONG-TERM INCENTIVES

Our LTI program, implemented in 2015, was designed with the specific intention of aligning the largest component of NEO pay to the achievement of exceptional and sustainable value creation for our shareholders. To achieve this, we have purposefully created an integrated technology ecosystem to support public safety and enterprise security, evolving from our LMR focus to integrate command center software, video security, analytics and access control solutions. The annual LTI program is designed to achieve this alignment through:

 

     

100% performance-based vesting with respect to our regular annual grant under the LTI program (i.e., no time-based vesting or guaranteed value)

 

     

The program metrics being 100% aligned to creating more value for our shareholders

 

     

The majority of the total award value requiring TSR performance above the median of S&P 500 companies in order to receive a target payout

Determining Target Award Values

The Committee reviews LTI target award values annually by first determining a target total compensation value appropriate for the size and complexity of the NEO’s role and then determining the appropriate LTI value based on our philosophy of delivering the largest percentage of total compensation in LTI. The Committee also considers the 100% performance-based nature of our annual LTI program and how our Company’s potential future performance has been impacted by the groundwork that has been set in the prior year. As we continue to execute our long-term strategy through our Company’s transformation, the Committee believes it is critical that each NEO’s target opportunity appropriately reflects their contribution.

When setting LTI target awards for 2021, the Committee considered the significant impact of Mr. Brown’s decisions and actions on our longer-term business strategy.

The Committee approved total target 2021 LTI at its March 2021 meeting.

 

           
  NEO  

TOTAL TARGET  

2020 LTI

  2021 LRIP   2021 POs/
Options
  2021 MSUs/
RSUs
  TOTAL TARGET
2021 LTI
  YEAR-OVER-
  YEAR CHANGE  
           

 BROWN

 

$14,100,000

 

$4,916,666

 

$4,916,667

 

$4,916,667

 

$14,750,000

 

5%

           

 WINKLER

 

$1,222,441

 

$1,066,666

 

$1,066,667

 

$1,066,667

 

$3,200,000

 

162%1

           

 MOLLOY2

 

$3,200,000

 

$1,133,334

 

$1,133,333

 

$1,133,333

 

$3,400,000

 

6%

           

 HACKER

 

$2,100,000

 

$750,000

 

$750,000

 

$750,000

 

$2,250,000

 

7%

           

 SAPTHARISHI3

 

 

$327,171

 

$548,750

 

$746,250

 

$1,622,171

 

N/A

           

 MARK

 

$2,400,000

 

$838,334

 

$838,333

 

$838,333

 

$2,515,000

 

5%

  1

Mr. Winkler’s 2020 LTI award was granted prior to and at the time of his promotion; his 2021 LTI award reflects his new role as Executive Vice President and Chief Financial Officer.

  2 

Mr. Molloy’s total target 2021 LTI award excludes a recognition grant received in June 2021 for his leadership in the sales and services organization.

  3

Dr. Saptharishi, who was elevated to the Company’s Executive Committee in June 2021 and promoted to Executive Vice President and Chief Technology Officer in November 2021, received an annual equity grant in March 2021, a recognition grant for an expanded role in May 2021, and a promotion grant in November 2021, all comprised of time-vested stock options and RSUs. Dr. Saptharishi also received a grant in November 2021 for a prorated LRIP target. Table only reflects Dr. Saptharishi’s compensation as an NEO; therefore, the “Year-Over-Year Change” column is not applicable.

LTI Components

The 100% performance-based annual LTI program includes the LRIP, POs and MSUs, each of which comprise one-third of the total LTI mix.

 

     

Both the LRIP (which, beginning with our 2021 performance cycle, is now denominated 100% in PSUs for all NEOs) and POs are based on three-year TSR relative to the S&P 500. The payout scale for the LRIP and POs requires our performance over a three-year period to exceed median performance of the S&P 500 companies before earning a target payout.

 

     

The 2021-2023 LRIP cycle is denominated 100% in PSUs for each NEO. The LRIP and POs utilize a three-year performance period and, consistent with earned POs, earned PSUs will settle on the third anniversary of the grant.

 

     

With new LRIP cycles denominated in equity, the 2021 Summary Compensation Table on page 62 of this Proxy Statement will show LRIP awards in two places for each of 2019, 2020 and 2021: (1) LRIP earned from the 2017-2019 cycle, 2018-2020 cycle, and 2019-2021 cycle (with amounts paid in cash and stock), will be reflected in the Non-Equity Incentive Plan column, and (2) target PSU grants for the 2019- 2021, 2020-2022, and 2021-2023 LRIP cycles will be reflected in the Stock Awards column (with grant date fair value of the new LRIP PSUs at target).

 

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If our TSR over the performance period is negative, but would still result in a ranking that would provide a payout, the Committee has unlimited discretion to reduce the calculated LRIP payout (and number of POs vesting).

 

     

The TSR calculation uses a three-month average stock price at the beginning (three months preceding performance cycle start) and end (final three months in performance cycle, plus the value of reinvested dividends) of the period for measurement purposes. This approach minimizes the impact of a single beginning and ending point stock price for each performance cycle.

 

     

MSUs are based on absolute stock price appreciation/depreciation and provide a vehicle to further align with our shareholders and support retention of our NEOs.

 

     

Each 1% increase/decrease in stock price results in a 1% increase/decrease in the number of MSUs earned at the end of the performance period, with a maximum payout at 100% stock price appreciation and a threshold of 40% stock price depreciation, below which no MSUs are earned.

 

     

The MSUs are earned and vest based on stock price appreciation/depreciation at the first, second, and third anniversaries of the date of grant with respect to one-third of the grant for each of the three concurrent performance periods.

 

 

LOGO

COMPARATIVE MARKET DATA

When setting compensation for our NEOs, the Committee reviews comparative market data from our peer group companies, as well as survey market data.

2021 PEER GROUP

Our peer group is used by the Committee to compare pay levels, pay mix and alignment of pay with our performance, as discussed in the “How We Plan Compensation” section above on page 52 of this Proxy Statement.

Peer Selection Criteria

To ensure meaningful comparisons, the Committee, with the assistance of the Committee’s independent consultant, reviews the peer group annually and makes updates as necessary. Specifically, as we continue to extend our leadership in public safety and enterprise security by expanding our technologies within each of our Products and Systems Integration and Software and Services segments through strategic investments and acquisitions, the Committee continues to include software and services companies in its review.

 

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To create a sufficiently sized peer group with whom we compete for executive talent, the Committee considers a combination of primary criteria and secondary criteria, including those listed below:

 

     

Primary Criteria: Publicly traded securities listed on a U.S. stock exchange, revenues and/or market capitalization within 1/3x to 3.0x of that of Motorola Solutions, and relevant Global Industry Classification Standard (GICS) sub-industry segments across the communications, information technology, and industrials sectors

 

     

Secondary Criteria: Companies that list Motorola Solutions as a peer, companies named as peers by shareholder advisory firms, companies listed as peers by current peers, and companies with comparable revenue growth, TSR, and business mix

Changes to the 2021 Peer Group

In early 2021, the Committee approved the following changes:

 

     

Removals: Ingersoll Rand PLC (n/k/a Trane Technologies) and Raytheon Company (merged with United Technologies Corporation in April 2020 to form Raytheon Technologies Corporation)

 

     

Addition: Fortive Corporation (size-appropriate; industry competitor)

At the time of approval, in February 2021, Motorola Solutions was positioned at the 71st percentile for revenue and the 33rd percentile for market capitalization among the resulting 13 company peer group.

2021 Peer Group Companies

 

   

Agilent Technologies, Inc.

  

Illinois Tool Works Inc.

  

Roper Technologies, Inc.

   

Autodesk, Inc.

  

Intuit Inc.

  

ServiceNow, Inc.

   

Citrix Systems, Inc.

  

L3Harris Technologies, Inc.

  

Trimble Inc.

   

Dover Corporation

  

Parker-Hannifin Corporation

    
   

Fortive Corporation

  

Rockwell Automation, Inc.

    

SURVEY MARKET DATA

To supplement our peer group data, the Committee also considers compensation surveys that include data from companies of similar size and business segments to the Company. For 2021, similar to prior years, the Committee considered data from the Radford Global Technology Survey, Willis Towers Watson High Tech Executive Survey and the IPAS Global High Technology Survey.

EQUITY USAGE UNDER OUR COMPENSATION PROGRAMS

In 2012, we reduced our overall share usage (equity grants as a percentage of common shares outstanding) from our prior granting practices to more effectively manage our stock-based compensation expense and overall shareholder dilution. The expense from grants prior to 2012 made to a broader population was fully recognized by 2016. Our share granting practices have again evolved to meet the changing needs of our business and drive our growth. The Committee has also delegated authority to the most senior human resources executive to make off-cycle equity grants to newly hired or promoted employees, in recognition of outstanding achievement or for retention. These types of grants are made on the first trading day of each month.

At the 2015 annual meeting of shareholders, shareholders approved the Motorola Solutions 2015 Omnibus Incentive Plan, which was an amendment and restatement of the Motorola Solutions Omnibus Incentive Plan of 2006 (the “Omnibus Plan”). This reduced the total number of shares reserved and approved for issuance by approximately 7 million shares, to 12 million shares. We continued to closely manage our equity-granting practices to ensure our share usage and stock-based compensation expense remains in line with competitive levels. At this Annual Meeting, the Company is presenting Proposal 4 to our shareholders, to approve the Amended and Restated Omnibus Incentive Plan of 2015, which, among other items, would increase the total number of shares reserved and approved for issuance by 4,650,000 shares. For additional information regarding Proposal 4, please refer to the section titled “Proposal No. 4 – Approval of the Amended and Restated Omnibus Incentive Plan of 2015” on page 82 of this Proxy Statement.

In 2021, we continued to have acquisition activity and, in an effort to preserve enterprise knowledge and align our new employees’ interests with those of our shareholders, we issued equity either as part of an acquisition or made retention grants under the Omnibus Plan. The shares issued as part of an acquisition were granted outside of our standard compensation programs and do not count against our shares available for future issuance. The information below for 2019, 2020 and 2021 only includes share usage as a percentage of common stock outstanding as of

 

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December 31 for each year and aggregate value of equity granted under our compensation programs and excludes 0.27% share usage and $56 million value of equity granted as part of acquisitions for 2019, 0.03% share usage and $9 million value of equity granted as part of acquisitions for 2020, and 0.09% share usage and $33 million value of equity granted as part of acquisitions for 2021.

 

LOGO

We do not structure the timing of equity awards to precede or coincide with the disclosure of material non-public information. All equity grants made to Section 16 officers and other members of the management team are approved by the Committee, with concurrence by the Board for grants to Mr. Brown.

OTHER COMPENSATION POLICIES AND PRACTICES

BENEFITS AND PERQUISITES

To enhance our ability to attract and retain talented executives in a highly competitive talent market, we provide the benefits and perquisites detailed in the following table:

 

     
  BENEFIT OR PERQUISITE   NAMED
        EXECUTIVES        
   OTHER EXECUTIVES
AND MANAGERS
   

    ALL ELIGIBLE    

    FULL-TIME    

    EMPLOYEES    

     

  Retirement1, Saving and Stock Purchase Plans

 

 

LOGO

 

  

 

 

LOGO

 

 

 

 

LOGO

 

     

  Health and Welfare Benefits2

 

 

LOGO

 

  

 

 

LOGO

 

 

 

 

LOGO

 

     

  Deferred Compensation3

 

 

LOGO

 

  

 

 

LOGO

 

 

 

   
     

  Financial Planning Counseling4

 

 

LOGO

 

  

 

 

Vice Presidents

 

 

 

   
     

  Executive Physicals

 

 

LOGO

 

  

 

 

Senior and Executive VPs

 

 

 

   
     

  Security System Monitoring

 

 

CEO

 

            
     

  Personal Use of Corporate Aircraft Service5

 

 

CEO

 

            

1 Pension provided to U.S.-based eligible employees hired prior to January 1, 2005. For a detailed description of our retirement plans, please refer to the section of this Proxy Statement on page 70 titled “Retirement Plans.”

2 Includes medical, dental, vision, group life insurance, business travel accident insurance, short- and long-term disability and work life programs.

3 For a detailed discussion of the Motorola Solutions Management Deferred Compensation Plan, please refer to the section of this Proxy Statement on page 69 titled “Nonqualified Deferred Compensation in 2021.”

4 A financial wellness coaching program is also offered to all U.S. employees.

5 In limited circumstances, and as approved by the CEO, other employees (including our NEOs) are permitted to use our corporate aircraft service for personal purposes.

STOCK OWNERSHIP GUIDELINES

To ensure strong alignment of our senior management with the interests of our shareholders, the Company maintains stock ownership guidelines for our senior executives, including each of our NEOs. The Committee reviews compliance with the ownership guidelines annually. In the Committee’s last review, it was determined that all NEOs had met their stock ownership requirement or are within the five-year achievement period.

 

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Our stock ownership requirements are expressed as a multiple of base salary as shown below:

 

EXECUTIVE GROUP   

    MULTIPLE OF    
    BASE  SALARY    

    2021    

  Chairman and Chief Executive Officer

  

10x

  Executive Vice Presidents and Executive Committee Members

  

3x

  Senior Vice Presidents

  

2x

  Corporate Vice Presidents

  

1x

Executives subject to the guidelines must meet their ownership requirement within five years from the date they first become subject to their applicable ownership requirement. Executives who do not meet their stock ownership requirement within five years must hold 100% of net shares acquired (net of tax withholding) on the exercise of stock options and the vesting of RSUs or MSUs until compliance with the stock ownership requirement is achieved. Shares counted toward guideline achievement include directly owned shares, unvested RSUs and target MSUs.

CHANGE IN CONTROL POLICY

The Company maintains the Senior Officer Change in Control Severance Plan (the “CIC Severance Plan”), which the Board has the ability to amend or terminate with at least one year’s notice to participants.

The CIC Severance Plan covers our NEOs (except for Mr. Brown, whose employment agreement contains change in control provisions) and our other senior executives. The Board considers the maintenance of an effective and stable management team essential to protecting and enhancing the value of the Company for the benefit of our shareholders. To that end, we recognize that the possibility of a change in control may exist and that this possibility, along with the uncertainty and questions it may raise for certain senior executives, may result in the distraction, and potential departure, of senior management employees to the detriment of the Company and our shareholders. The CIC Severance Plan helps to encourage the continued attention and dedication of our senior management to their assigned duties without the distraction that may arise from the possibility of a change in control event.

The CIC Severance Plan employs a “double trigger” in order for severance benefits to be paid, meaning that both a change in control event must occur and an executive must be involuntarily terminated without “cause” or must leave for “good reason” within 24 months following the change in control.

The table below highlights key provisions of the CIC Severance Plan. For a detailed description of the CIC Severance Plan, please refer to the section of this Proxy Statement on page 72 titled “Change in Control Arrangements.” Additionally, for a detailed description of our 2011 Executive Severance Plan, amended and restated in 2014, please refer to the section of this Proxy Statement on page 73 titled “Executive Severance Plan.”

 

 

CIC PROVISION

 

CIC SEVERANCE PLAN

 

  Eligibility

 

 

Executive and Senior Vice Presidents

 

  Cash Severance Multiple

 

 

 

Two times sum of base salary and target bonus

 

  Medical Benefit Continuation

 

 

Two years

 

  LRIP and Equity Treatment

  (Provision in Omnibus Plan)

 

  Equity and LRIP subject to “double trigger” unless awards are not assumed or replaced by acquirer. If not assumed or replaced, equity and LRIP provide for accelerated treatment with performance at target.

 

  Excise Tax Gross-Up

 

 

 

None. Participants receive “best net” after-tax position of either participant’s paying the excise tax or a reduction in severance benefits to a level that eliminates the imposition of excise tax.

RECOUPMENT OF INCENTIVE COMPENSATION AWARDS UPON RESTATEMENT OF FINANCIAL RESULTS

If, in the opinion of the independent directors of the Board, the Company’s financial results require restatement due to the misconduct by one or more of the Company’s executive officers (including the NEOs), the independent directors may seek a number of remedies, all of which are subject to a number of conditions, including (i) whether the executive officer engaged in intentional misconduct, (ii) whether the bonus or incentive compensation to be recouped was calculated based upon the financial results that were restated, and (iii) whether the incentive compensation calculated under the restated financial results is less than the amount actually paid or awarded. The independent directors review whether to require one or more remedies by directing the Company to recover all or a portion of any incentive compensation received by the executive as a result of the misconduct, as well as cancel all or a portion of the outstanding equity-based awards held by the executive

 

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(commonly referred to as a clawback policy). In addition, the independent directors may also seek to recoup any gains realized by the executive with respect to their equity-based awards, including exercised stock options and vested RSUs, MSUs or PSUs, regardless of when they were issued.

IMPACT OF FAVORABLE ACCOUNTING AND TAX TREATMENT ON COMPENSATION PROGRAM DESIGN

Favorable accounting and tax treatment of the various elements of our total compensation program was an important, but not the sole, consideration in its design. Section 162(m) of the Internal Revenue Code limits the deductibility of certain items of compensation paid to the CEO and certain other highly compensated executive officers (together, the “covered officers”) to $1,000,000 annually, but in years prior to 2018 there was an exception to such limit for compensation that qualified as “performance-based compensation.” Beginning in 2018, the Tax Cuts and Jobs Act amended Section 162(m) to, among other things eliminate the exception for performance-based compensation, except for certain qualifying arrangements in place as of November 2, 2017.

The Committee reserves the right to provide for compensation to executive officers that may not be deductible pursuant to Section 162(m). In addition, because of the continued development of the application and interpretation of Section 162(m) and the regulations issued thereunder, we cannot guarantee that compensation intended to satisfy the requirements for deductibility under Section 162(m), as in effect prior to 2018, would or will in fact be deductible.

ANTI-HEDGING POLICY

We have adopted, as part of our insider trading prohibitions policy, prohibitions on directors, officers (including our NEOs) and certain other designated employees from directly or indirectly holding any security tied to the performance of Motorola Solutions other than our Common Stock and stock options delivered directly to employees under our equity incentive plans.

Our broader insider trading prohibitions policy is applicable to all employees who may have access to inside information and is designed to ensure compliance with all applicable insider trading rules.

 

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COMPENSATION AND LEADERSHIP COMMITTEE REPORT

 

THE FOLLOWING REPORT OF THE COMPENSATION AND LEADERSHIP COMMITTEE ON EXECUTIVE COMPENSATION AND RELATED DISCLOSURE SHALL NOT BE DEEMED INCORPORATED BY REFERENCE BY ANY GENERAL STATEMENT INCORPORATING THIS PROXY STATEMENT INTO ANY FILING UNDER THE SECURITIES ACT OF 1933 (THE “SECURITIES ACT”) OR UNDER THE EXCHANGE ACT, EXCEPT TO THE EXTENT THAT THE COMPANY SPECIFICALLY INCORPORATES THIS INFORMATION BY REFERENCE, AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER SUCH ACTS.

On May 18, 2021, Joseph M. Tucci was again appointed the Chair of the Compensation and Leadership Committee (the “Committee”). Each of Joseph M. Tucci, Kenneth D. Denman and Egon P. Durban was a member of the Committee throughout 2021.

The Committee has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with Company management. Based on such review and discussions, the Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference into Motorola Solutions’ Annual Report on Form 10-K for the year ended December 31, 2021.

Respectfully submitted,

Joseph M. Tucci, Chair

Kenneth D. Denman

Egon P. Durban

 

 

COMPENSATION AND LEADERSHIP COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Joseph M. Tucci, Director and Chair of the Committee, Kenneth D. Denman, Director, and Egon P. Durban, Director, each served on the Committee throughout 2021. No member of the Committee was, during the fiscal year ended December 31, 2021, an officer, former officer, or employee of the Company or any of our subsidiaries. We did not have any compensation committee interlocks in 2021.

 

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NAMED EXECUTIVE OFFICER COMPENSATION

 

2021 SUMMARY COMPENSATION TABLE

The following table sets forth the total compensation of each of the Company’s NEOs, for the years ended December 31, 2021, 2020 and 2019, as applicable.

 

Name and

Principal Position

             (a)

 

Year

(b)

   

Salary

($)(1)

(c)

   

Bonus

($)(2)

(d)

   

Stock

Awards

($)(3,4)

(e)

   

Option

Awards

($)(4)

(f)

   

Non-Equity

Incentive

Plan

Compensation

($)(5)

(g)

   

 

Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings

($)(6)

(h)

   

All Other

Compensation

($)(7)

(i)

   

Total

($)(8)

(j)

 

 

 Gregory Q. Brown

 Chairman and Chief Executive Officer

 

 

                 

                                         

    2021       1,250,000       0       10,501,466       4,916,617       2,940,000           6,602           365,954           19,980,639  
                 
      2020       937,500       1,421,875       9,399,711       4,699,939       6,250,000           21,004           370,825           23,100,854  
                 
      2019       1,250,000       0       7,408,181       3,704,137       10,966,875           35,151           309,641           23,673,985  

 

 Jason J. Winkler

 Executive Vice President and Chief Financial Officer

 

 

                 
      2021       650,962       0       2,278,145       1,066,655       1,310,210           188,611           58,343           5,552,926  
                 
      2020       456,077       242,291       449,799       449,971       386,728           153,045           57,843         2,195,754  

 

 John P. Molloy

 Executive Vice President and Chief Operating Officer

 

 

                 
      2021       768,269       0       2,612,075       1,333,291       1,710,093           141,343           94,644           6,659,715  
                 
      2020       686,808       435,861       1,599,820       1,066,601       1,333,332           176,743           48,924           5,348,089  
                 
      2019       703,769       0