Document:

exv10w30

 

Exhibit 10.30

MOTOROLA, INC. SENIOR OFFICER

CHANGE IN CONTROL SEVERANCE PLAN

INTRODUCTION

          The Board of Directors of Motorola, Inc. considers the maintenance of a sound management to be
essential to protecting and enhancing the best interests of the Company (as hereinafter defined)
and its stockholders. In this connection, the Company recognizes that the possibility of a Change
in Control (as hereinafter defined) may exist from time to time, and that this possibility, and the
uncertainty and questions it may raise among management, may result in the departure or distraction
of management personnel to the detriment of the Company and its stockholders. Accordingly, the
Board (as hereinafter defined) has determined that appropriate steps should be taken to encourage
the continued attention and dedication of members of the Company’s management to their assigned
duties without the distraction which may arise from the possibility of a Change in Control of the
Company.

          This Plan does not alter the status of Participants (as hereinafter defined) as at-will
employees of the Company. Just as Participants remain free to leave the employ of the Company at
any time, so too does the Company retain its right to terminate the employment of Participants
without notice, at any time, for any reason. However, the Company believes that, both prior to and
at the time a Change in Control is anticipated or occurring, it is necessary to have the continued
attention and dedication of Participants to their assigned duties without distraction, and this
Plan is intended as an inducement for Participants’ willingness to continue to serve as employees
of the Company (subject, however, to either party’s right to terminate such employment at any
time). Therefore, should a Participant still be an employee of the Company at such time, the
Company agrees that such Participant shall receive the severance benefits hereinafter set forth in
the event the Participant’s employment with the Company terminates subsequent to a Change in
Control under the circumstances described below.

          Notwithstanding the foregoing and Section 4.2(d), however, in the event that the Participant
is terminated by the Company (other than for Cause (as hereinafter defined)) prior to a Change in
Control, but subsequent to such time as negotiations or discussions which ultimately lead to a
Change in Control have commenced, then such termination shall be deemed to be a termination which
entitles such Participant to the severance benefits hereinafter set forth.

ARTICLE I

ESTABLISHMENT OF PLAN

          As of the Effective Date (as hereinafter defined), the Company hereby establishes a separation
compensation plan known as the Motorola, Inc. Senior Officer Change in Control Severance Plan, as
set forth in this document.

 

 

ARTICLE II

DEFINITIONS

          As used herein the following words and phrases shall have the following respective meanings
unless the context clearly indicates otherwise.

          (a) Affiliate. Any entity which controls, is controlled by or is under common control
with the Company.

          (b) Board. The Board of Directors of the Company.

          (c) Cause. With respect to any Participant: (i) the Participant’s conviction of any criminal
violation involving dishonesty, fraud or breach of trust or (ii) the Participant’s willful
engagement in gross misconduct in the performance of the Participant’s duties that materially
injures the Company.

          (d) Change in Control. The occurrence of any of the following events: a change in
control of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended (“Exchange
Act”), or any successor provision thereto, whether or not the Company is then subject to such
reporting requirement; provided that, without limitation, such a Change in Control shall be deemed
to have occurred if (i) any “person” or “group” (as such terms are used in Section 13(d) and 14(d)
of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company representing 20% or more of the
combined voting power of the Company’s then outstanding securities (other than the Company or any
employee benefit plan of the Company; and, for purposes of the Plan, no Change in Control shall be
deemed to have occurred as a result of the “beneficial ownership,” or changes therein, of the
Company’s securities by either of the foregoing), (ii) there shall be consummated (A) any
consolidation or merger of the Company in which the Company is not the surviving or continuing
corporation or pursuant to which shares of common stock would be converted into or exchanged for
cash, securities or other property, other than a merger of the Company in which the holders of
common stock immediately prior to the merger have, directly or indirectly, at least a 65% ownership
interest in the outstanding common stock of the surviving corporation immediately after the merger,
or (B) any sale, lease, exchange or other transfer (in one transaction or a series of related
transactions) of all, or substantially all, of the assets of the Company other than any such
transaction with entities in which the holders of the Company’s common stock, directly or
indirectly, have at least a 65% ownership interest, (iii) the shareholders of the Company approve
any plan or proposal for the liquidation or dissolution of the Company, or (iv) as the result of,
or in connection with, any cash tender offer, exchange offer, merger or other business combination,
sale of assets, proxy or consent solicitation (other than by the Board), contested election or
substantial stock accumulation (a “Control Transaction”), the members of the Board immediately
prior to the first public announcement relating to such Control Transaction shall thereafter cease
to constitute a majority of the Board.

 

 

          (e) Code. The Internal Revenue Code of 1986, as amended from time to time.

          (f) Company. Motorola, Inc. and any successor thereto.

          (g) Date of Termination. The effective date specified in the Notice of Termination as
of which the Participant’s employment terminates (which shall be not less than thirty (30) days nor
more than sixty (60) days after the date such Notice of Termination is given).

          (h) Disability. A condition such that the Participant by reason of physical or mental
disability becomes unable to perform his normal duties for more than one-hundred eighty (180) days
in the aggregate (excluding infrequent or temporary absence due to ordinary transitory illness)
during any twelve-month period.

          (i) Effective Date. The Effective Date shall be May 9, 2001.

          (j) Employee. Any full-time, regular-benefit, non-bargaining employee of the Company.

          (k) ERISA. The Employee Retirement Income Security Act of 1974, as amended from time
to time.

          (l) Good Reason. With respect to any Participant, without such Participant’s written
consent, (i) the Participant is assigned duties materially inconsistent with his position, duties,
responsibilities and status with the Company during the 90-day period immediately preceding a
Change in Control, or the Participant’s position, authority, duties or responsibilities are
materially diminished from those in effect during the 90-day period immediately preceding a Change
in Control (whether or not occurring solely as a result of the Company ceasing to be a publicly
traded entity), (ii) the Company reduces the Participant’s annual base salary or target incentive
opportunity under the Company’s annual incentive plan, or reduces the Participant’s target
incentive opportunity under any cash-based long-term incentive plan maintained by the Company, each
such target incentive opportunity as in effect during the 90-day period immediately prior to the
Change in Control, or as the same may be increased from time to time, unless such target incentive
opportunity is replaced by a substantially equivalent substitute opportunity, (iii) the Company
requires the Participant regularly to perform his duties of employment beyond a fifty (50) mile
radius from the location of the Participant’s employment immediately prior to the Change in
Control, (iv) the Company fails to obtain a satisfactory agreement from any successor to assume and
perform this Plan, as contemplated by Article VI hereof, or (v) the Company purports to terminate
the Participant’s employment other than pursuant to a Notice of Termination which satisfies the
requirements of Section 4.1 (and, for purposes of this Plan, no such purported termination shall be
effective).

          (m) Notice of Termination. Notice that shall indicate the specific termination
provision in this Plan (if any) relied upon and set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Participant’s employment.

 

 

          (n) Participant. An individual who qualifies as such pursuant to Section 3.1.

          (o) Plan. The Motorola, Inc. Senior Officer Change in Control Severance Plan.

          (p) Separation Benefits. The benefits described in Section 4.2 that are provided to
qualifying Participants under the Plan.

          (q) Subsidiary. Any corporation in which the Company, directly or indirectly, holds a
majority of the voting power of such corporation’s outstanding shares of capital stock.

ARTICLE III

ELIGIBILITY

          3.1 Participation. Participants in the Plan are elected officers of the Company who
are at or above the level of Senior Vice President; provided that such Participants will not be
entitled to Separation Benefits if they are not at or above the level of Senior Vice President at
the time of the Change in Control; provided, further that any reduction of a Participant’s position
prior to, but in connection with, a Change in Control shall be of no effect for purposes of this
Section 3.1. Notwithstanding the foregoing, a Participant shall not be entitled to receive
Separation Benefits (or any other benefits under the Plan), if the Participant has entered into a
change in control letter agreement with the Company which has not been waived by the Participant or
terminated by the Company.

          3.2 Duration of Participation. A Participant shall only cease to be a Participant in
the Plan as a result of an amendment or termination of the Plan complying with Article VI of the
Plan, or when he ceases to be an Employee or no longer qualifies as a Participant under Section
3.1, unless, at the time he ceases to be an Employee or no longer qualifies as a Participant under
Section 3.1, such Participant is entitled to payment of a Separation Benefit as provided in the
Plan or there has been an event or occurrence constituting Good Reason that would enable the
Participant to terminate his employment and receive a Separation Benefit. A Participant entitled
to payment of a Separation Benefit or any other amounts under the Plan shall remain a Participant
in the Plan until the full amount of the Separation Benefit and any other amounts payable under the
Plan have been paid to the Participant.

 

 

ARTICLE IV

SEPARATION BENEFITS

          4.1 Terminations of Employment Which Give Rise to Separation Benefits Under This Plan.
A Participant shall be entitled to Separation Benefits as set forth in Section 4.2 below if, at
any time following a Change in Control and prior to the second anniversary of the Change in
Control, the Participant’s employment is terminated (a) involuntarily for any reason other than
Cause, death, Disability or retirement under a mandatory retirement policy of the Company or any of
its Subsidiaries or (b) by the Participant after the occurrence of an event giving rise to Good
Reason. For purposes of this Plan, any purported termination by the Company or by the Participant
shall be communicated by written Notice of Termination to the other in accordance with Section 7.5
hereof.

          4.2 Separation Benefits.

          (a) If a Participant’s employment is terminated under circumstances which entitle the
Participant to Separation Benefits under this Section 4.2, then the Company shall pay to the
Participant, in a lump sum in cash within ten (10) days after the Date of Termination, the
aggregate of the following amounts which benefits, except as provided in Section 7.4 below, shall
be in addition to any other benefits to which the Participant is entitled other than by reason of
this Plan: (i) unpaid salary with respect to any vacation days accrued but not taken as of the
Date of Termination; (ii) accrued but unpaid salary through the Date of Termination, (iii) any
earned but unpaid annual incentive bonuses from the fiscal year immediately preceding the year in
which the Date of Termination occurs; (iv) the product of (A) the Participant’s target bonus for
the fiscal year in which the Date of Termination occurs (which for purposes of this Section 4.2 in
no event shall be less than the Participant’s target bonus for the fiscal year in which the Change
in Control occurs) and (B) a fraction, the numerator of which is the number of days in the then
current fiscal year through the Date of Termination and the denominator of which is 365; (v) an
amount equal to three (3) times the greater of (x) the Participant’s highest annual base salary in
effect at any time during the period commencing three (3) years preceding the date the Change in
Control occurs and ending on the date the Change in Control occurs, and (y) the Participant’s
annual base salary in effect on the Date of Termination, and (vi) an amount equal to three (3)
times the highest annual bonus, including any bonus or portion thereof that has been earned but
deferred (and annualized for any fiscal year consisting of less than twelve (12) full months or
during which the Participant was employed for less than twelve (12) full months), the Participant
received from the Company during the five (5) full fiscal years of the Company immediately
preceding the Date of Termination.

          (b) If the Participant’s employment is terminated under circumstances which entitle the
Participant to Separation Benefits under this Section 4.2, for three (3) years after the Date of
Termination, or such longer period as may be provided by the terms of the appropriate plan,
program, practice or policy, the Company shall continue health, medical, life and long-term
disability insurance benefits to the Participant and/or the Participant’s family at least equal to
those that would have been provided in accordance with the health, medical, life and long-term

 

 

disability insurance plans, programs, practices and policies of the Company immediately prior
to the Change in Control if the Participant’s employment had not been terminated on the same terms
and conditions (including any applicable required employee contributions), provided, however, that,
if the Participant becomes reemployed with another employer and becomes eligible to receive medical
or other welfare benefits under another employer provided plan, the medical and other welfare
benefits described herein shall be secondary to those provided under such other plan during such
applicable period of eligibility. If the terms of the applicable plan, program, practice or policy
do not permit the participation of the Participant or the Participant’s family, the Company shall
continue to provide the benefits described above on the same after-tax basis as if such benefits
were provided under such plan, program, practice or policy. For purposes of determining
eligibility (but not the time of commencement of benefits) of the Participant for retiree medical
benefits pursuant to such plans, practices, programs and policies, the Participant shall be
considered to have remained employed until three (3) years after the Date of Termination and to
have retired on the last day of such period (and to have attained three (3) additional years of
age), and such benefits (and the terms and conditions of such benefits) shall be no less favorable
than as in effect immediately prior to the Change in Control. Following the end of the period
during which medical benefits are provided to the Participant under this Section 4.2(b), the
Participant shall be eligible for continued health coverage as required by Section 4980B of the
Code or other applicable law, as if the Participant’s employment with the Company had terminated as
of the end of such period.

          (c) Except as provided in Section 4.2(b), the Participant shall not be required to mitigate
the amount of any payment provided for in this Section 4.2 by seeking other employment or
otherwise, nor shall the amount of any payment or benefit provided for in this Section 4.2 be
reduced by any compensation earned by the Participant as the result of employment by another
employer or by retirement benefits after the Date of Termination, or otherwise, or by any set-off,
counterclaim, recoupment, or other claim right or action the Company may have against the
Participant or others.

          (d) The provisions of this Article IV shall be applicable after a Change in Control has
occurred, but not prior thereto.

          4.3 Certain Additional Payments by the Company.

          (a) Anything in this Plan to the contrary notwithstanding and except as set forth below, in
the event it shall be determined that any Payment (as hereinafter defined) would be subject to the
Excise Tax (as hereinafter defined), then the Participant shall be entitled to receive an
additional payment (the “Gross-Up Payment”) in an amount such that, after payment by the
Participant of all taxes (and any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties imposed with
respect thereto), employment taxes and Excise Tax imposed upon the Gross-Up Payment, the
Participant retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the
Payments. Notwithstanding the foregoing provisions of this Section 4.3(a), if it shall be
determined that the Participant is entitled to the Gross-Up Payment, but that the Parachute Value

 

 

(as hereinafter defined) of all Payments do not exceed 110% of the Safe Harbor Amount (as
hereinafter defined), then no Gross-Up Payment shall be made to the Participant and the amounts
payable under this Agreement shall be reduced so that the Parachute Value of all Payments, in the
aggregate, equals the Safe Harbor Amount. The reduction of the amounts payable hereunder, if
applicable, shall be made by first reducing the payments under Section 4.2(a)(iv), unless an
alternative method of reduction is elected by the Participant, and in any event shall be made in
such a manner as to maximize the Value (as hereinafter defined) of all Payments actually made to
the Participant. For purposes of reducing the Payments to the Safe Harbor Amount, only amounts
payable under this Plan (and no other Payments) shall be reduced. If the reduction of the amount
payable under this Plan would not result in a reduction of the Parachute Value of all Payments to
the Safe Harbor Amount, no amounts payable under the Plan shall be reduced pursuant to this Section
4.3(a). The Company’s obligation to make Gross-Up Payments under this Section 4.3(a) shall not be
conditioned upon the Participant’s termination of employment.

          (b) Subject to the provisions of Section 4.3(c), all determinations required to be made under
this Section 4.3, including whether and when a Gross-Up Payment is required, the amount of such
Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be
made by KPMG LLP (the “Accounting Firm”). The Accounting Firm shall provide detailed supporting
calculations both to the Company and the Participant within fifteen (15) business days of the
receipt of notice from the Participant that there has been a Payment or such earlier time as is
requested by the Company. In the event that the Accounting Firm is serving as accountant or
auditor for the individual, entity or group effecting the Change in Control, the Company shall
appoint another nationally recognized accounting firm to make the determinations required hereunder
(which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and
expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as
determined pursuant to this Section 4.3, shall be paid by the Company to the Participant within ten
(10) days of the receipt of the Accounting Firm’s determination. Any determination by the
Accounting Firm shall be binding upon the Company and the Participant. As a result of the
uncertainty in the application of Section 4999 of the Code at the time of the initial determination
by the Accounting Firm hereunder, it is possible that Gross-Up Payments that will not have been
made by the Company should have been made (the “Underpayment”), consistent with the calculations
required to be made hereunder. In the event the Company exhausts its remedies pursuant to Section
4.3(c) and the Participant thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for the benefit of the Participant.

          (c) The Participant shall notify the Company in writing of any claim by the Internal Revenue
Service that, if successful, would require the payment by the Company of the Gross-Up Payment.
Such notification shall be given as soon as practicable, but no later than ten (10) business days
after the Participant is informed in writing of such claim. The Participant shall apprise the
Company of the nature of such claim and the date on which such claim is requested to be paid. The
Participant shall not pay such claim prior to the expiration of the 30-day period following the
date on which the Participant gives such notice to the Company (or such

 

 

shorter period ending on the date that any payment of taxes with respect to such claim is due). If
the Company notifies the Participant in writing prior to the expiration of such period that the
Company desires to contest such claim, the Participant shall:

	 	(1)	 	give the Company any information reasonably requested by the Company relating to
such claim,
	 
	 	(2)	 	take such action in connection with contesting such claim as the Company shall
reasonably request in writing from time to time, including, without limitation,
accepting legal representation with respect to such claim by an attorney reasonably
selected by the Company,
	 
	 	(3)	 	cooperate with the Company in good faith in order effectively to contest such
claim, and
	 
	 	(4)	 	permit the Company to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest, and shall indemnify
and hold the Participant harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties) imposed as a result of such representation and payment of costs
and expenses. Without limitation on the foregoing provisions of this Section 4.3(c), the Company
shall control all proceedings taken in connection with such contest, and, at its sole discretion,
may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with
the applicable taxing authority in respect of such claim and may, at its sole discretion, either
direct the Participant to pay the tax claimed and sue for a refund or contest the claim in any
permissible manner, and the Participant agrees to prosecute such contest to a determination before
any administrative tribunal, in a court of initial jurisdiction and in one (1) or more appellate
courts, as the Company shall determine; provided, however, that, if the Company directs the
Participant to pay such claim and sue for a refund, the Company shall advance the amount of such
payment to the Participant, on an interest-free basis, and shall indemnify and hold the Participant
harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or
penalties) imposed with respect to such advance or with respect to any imputed income in connection
with such advance; and provided, further, that any extension of the statute of limitations relating
to payment of taxes for the Participant’s taxable year with respect to which such contested amount
is claimed to be due is limited solely to such contested amount. Furthermore, the Company’s
control of the contest shall be limited to issues with respect to which the Gross-Up Payment would
be payable hereunder, and the Participant shall be entitled to settle or contest, as the case may
be, any other issue raised by the Internal Revenue Service or any other taxing authority.

          (d) If, after the receipt by the Participant of an amount advanced by the Company pursuant to
Section 4.3(c), the Participant becomes entitled to receive any refund with respect to such claim,
the Participant shall (subject to the Company’s complying with the

 

 

requirements of Section 4.3(c))
promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If,
after the receipt by the Participant of an amount advanced by the Company pursuant to Section
4.3(c), a determination is made that the Participant shall not be entitled to any refund with
respect to such claim and the Company does not notify the Participant in writing of its intent to
contest such denial of refund prior to the expiration of thirty (30) days after such determination,
then such advance shall be forgiven and shall not be required to be repaid and the amount of such
advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid.

          (e) Notwithstanding any other provision of this Section 4.3, the Company may, in its sole
discretion, withhold and pay over to the Internal Revenue Service or any other applicable taxing
authority, for the benefit of the Participant, all or any portion of the Gross-Up Payment, and the
Participant hereby consents to such withholding; provided, that, such withholding and payment shall
in no event place the Participant in a less favorable tax position than had such payments been made
to the Participant by the Company.

          (f) Definitions. The following terms shall have the following meanings for purposes
of this Section 4.3.

               (i) “Excise Tax” shall mean the excise tax imposed by Section 4999 of the Code, together with
any interest or penalties imposed with respect to such excise tax.

               (ii) The “Net After-Tax Amount” of a Payment shall mean the Value of a Payment net of all
taxes imposed on the Participant with respect thereto under Sections 1 and 4999 of the Code and
applicable state and local law, determined by applying the highest marginal rates that are expected
to apply to your taxable income for the taxable year in which the Payment is made.

               (iii) “Parachute Value” of a Payment shall mean the present value as of the date of the change
of control for purposes of Section 280G of the Code of the portion of such Payment that constitutes
a “parachute payment” under Section 280G(b)(2), as determined by the Accounting Firm for purposes
of determining whether and to what extent the Excise Tax will apply to such Payment.

               (iv) A “Payment” shall mean any payment or distribution in the nature of compensation (within
the meaning of Section 280G(b)(2) of the Code) to or for the benefit of the Participant, whether
paid or payable pursuant to this Agreement or otherwise.

               (v) The “Safe Harbor Amount” means the maximum Parachute Value of all Payments that the
Participant can receive without any Payments being subject to the Excise Tax.

               (vi) “Value” of a Payment shall mean the economic present value of a Payment as of the date of
the change of control for purposes of Section 280G of the Code, as

 

 

determined by the Accounting
Firm using the discount rate required by Section 280G(d)(4) of the Code.

ARTICLE V

 SUCCESSOR TO COMPANY

          This Plan shall bind any successor of the Company, its assets or its businesses (whether
direct or indirect, by purchase, merger, consolidation or otherwise), in the same manner and to the
same extent that the Company would be obligated under this Plan if no succession had taken place.
In the case of any transaction in which a successor would not by the foregoing provision or by
operation of law be bound by this Plan, the Company shall require such successor expressly and
unconditionally to assume and agree to perform the Company’s obligations under this Plan, in the
same manner and to the same extent that the Company would be required to perform if no such
succession had taken place. The term “Company,” as used in this Plan, shall mean the Company as
hereinbefore defined and any successor or assignee to the business or assets which by reason hereof
becomes bound by this Plan.

 

 

ARTICLE VI

DURATION, AMENDMENT AND TERMINATION

          6.1 Duration. If a Change in Control has not occurred, this Plan shall expire three
(3) years from the Effective Date; provided, that upon each annual anniversary of the Effective
Date (each such annual anniversary a “Renewal Date”), the Plan shall be extended for an additional
year, unless pursuant to a resolution adopted by the Board prior to the Renewal Date the Company
determines not to so extend the Plan. If a Change in Control occurs while this Plan is in effect,
this Plan shall continue in full force and effect for at least two (2) years following such Change
in Control, and shall not terminate or expire until after all Participants who become entitled to
any payments hereunder shall have received such payments in full.

          6.2 Amendment or Termination. The Board may amend or terminate this Plan at any time,
including amending the eligibility to participate in the Plan of Employees who are not existing
Participants; provided, that this Plan may not be amended or terminated in a manner adverse to
Participants as of the date of the amendment or termination without three (3) years’ advance
written notice of such amendment or termination (including modifying the eligibility of Employees
who are already Participants to participate in the Plan).

          6.3 Procedure for Extension, Amendment or Termination. Any extension, amendment or
termination of this Plan by the Board in accordance with this Article VI shall be made by action of
the Board in accordance with the Company’s charter and by-laws and applicable law.

ARTICLE VII

MISCELLANEOUS

          7.1 Default in Payment. Any payment not made within ten (10) days after it is due in
accordance with this Plan shall thereafter bear interest, compounded annually, at the prime rate
from time to time in effect at the First National Bank of Chicago or any successor thereto.

          7.2 No Assignment. No interest of any Participant or spouse of any Participant or any
other beneficiary under this Plan, or any right to receive payment hereunder, shall be subject in
any manner to sale, transfer, assignment, pledge, attachment, garnishment, or other alienation or
encumbrance of any kind, nor may such interest or right to receive a payment or distribution be
taken, voluntarily or involuntarily, for the satisfaction of the obligations or debts of, or other
claims against, a Participant or spouse of a Participant or other beneficiary, including for
alimony.

          7.3 Disputes. The Company shall upon request pay from time to time a Participant’s
reasonable out-of-pocket expenses, including legal fees and expenses, incurred by the Participant
or on the Participant’s behalf in connection with any action taken by the Participant or on the
Participant’s behalf (including any judicial proceeding) to enforce this Plan

 

 

or to construe, or to determine or defend the validity of, this Plan or otherwise in
connection herewith; provided, however, that, in the case of any judicial proceeding in which a
Participant and the Company are adverse parties or any dispute under Section 4.3 hereof, the
Company shall not be required to pay such expenses (and shall have the right to recover such
expenses from the Participant if previously advanced) with respect to any position or claim on
which the Company ultimately prevails against the Participant in all material respects. In any
judicial or other proceeding in which the Participant’s rights to, or the amount of, benefits
hereunder is disputed, the ultimate burden of proof shall be on the Company.

          7.4 Effect on Other Plans, Agreements and Benefits. Except to the extent expressly
set forth herein, any benefit or compensation to which a Participant is entitled under any
agreement between the Participant and the Company or any of its Subsidiaries or under any plan
maintained by the Company or any of its Subsidiaries in which the Participant participates or
participated shall not be modified or lessened in any way, but shall be payable according to the
terms of the applicable plan or agreement. Notwithstanding the foregoing, any benefits received by
a Participant pursuant to this Plan shall be in lieu of any severance benefits to which the
Participant would otherwise be entitled under any general severance policy or other severance plan
maintained by the Company for its management personnel. In the event of a Participant’s
termination of employment entitling the Participant to Separation Benefits under Section 4.2, any
non-competition or non-solicitation provisions applicable to the Participant with respect to the
Company or any of its Affiliates shall cease to apply as of the Participant’s Date of Termination.

          7.5 Notice. For the purpose of this Plan, notices and all other communications
provided for in this Plan shall be in writing and shall be deemed to have been duly given when
actually delivered or mailed by United States registered mail, return receipt requested, postage
prepaid, addressed to the Company at its corporate headquarters address, and to the Participant (at
the last address of the Participant on the Company’s books and records), provided, that all notices
to the Company shall be directed to the attention of the Board with a copy to the Secretary.

          7.6 Employment Status. This Plan does not constitute a contract of employment or
impose on the Participant or the Company any obligation for the Participant to remain an Employee
or change the status of the Participant’s employment or the policies of the Company and its
Affiliates regarding termination of employment.

          7.7 Named Fiduciary; Administration. The Company is the named fiduciary of the Plan,
and shall administer the Plan, acting through the Compensation Committee of the Board, or its
delegatee.

          7.8 Unfunded Plan Status. This Plan is intended to be an unfunded plan maintained
primarily for the purpose of providing deferred compensation for a select group of management or
highly compensated employees, within the meaning of Section 401 of ERISA. All payments pursuant to
the Plan shall be made from the general funds of the Company and no special or separate fund shall
be established or other segregation of assets made to assure

 

 

payment. No Participant or other person shall have under any circumstances any interest in
any particular property or assets of the Company as a result of participating in the Plan.
Notwithstanding the foregoing, the Company may (but shall not be obligated to) create one (1) or
more grantor trusts, the assets of which are subject to the claims of the Company’s creditors, to
assist it in accumulating funds to pay its obligations under the Plan.

          7.9 Validity and Severability. The invalidity or unenforceability of any provision of
the Plan shall not affect the validity or enforceability of any other provision of the Plan, which
shall remain in full force and effect, and any prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any other jurisdiction.

          7.10 Governing Law. The validity, interpretation, construction and performance of the
Plan shall in all respects be governed by the laws of Delaware, without reference to principles of
conflict of law, except to the extent pre-empted by Federal law.

 

 

APPENDIX

     To the extent the Plan is deemed to constitute a nonqualified deferred compensation plan
within the meaning of Section 409A of the Code, the Plan shall be interpreted and administered, to
the maximum extent possible, in a manner consistent with said Code Section. As a result, to the
extent payments to specified employees (as defined Section 409A(a)(2)(B)(i) of the Code) must be
suspended to the six-month anniversary of a Participant’s separation from service to comply with
Section 409A, such payments shall be suspended accordingly (or, until the date of death of the
specified employee, if earlier). Any payment due within the six-month period shall paid at the
end of the six-month period.exv10w34

 

Exhibit 10.34

EMPLOYMENT AGREEMENT

     AGREEMENT by and between Motorola, Inc. (the “Company”), and Edward J. Zander (the
“Executive”) dated as of the 15th day of December 2003, as amended as of the 27th day of July, 2005
and the 2nd day of May, 2006.

     WHEREAS, the Board of Directors of the Company (the “Board”) has determined that it is in the
best interests of the Company and its shareholders to employ the Executive as the Company’s Chief
Executive Officer and to have the Executive serve as Chairman of the Board;

     WHEREAS, the Company desires to employ the Executive and to enter into an agreement embodying
the terms of such employment; and

     WHEREAS, the Executive desires to enter into this Agreement and to accept such employment,
subject to the terms and provisions of this Agreement;

     NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein and for
other good and valuable consideration, the receipt of which is mutually acknowledged, the Company
and the Executive (individually a “Party” and together the “Parties”) agree as follows:

     1. Effective Date. The “Effective Date” shall mean January 5, 2004.

     2. Employment Period. The Company hereby agrees to employ the Executive, and the
Executive hereby agrees to be employed by the Company, subject to the terms and conditions of this
Agreement, for the period commencing on the Effective Date and ending on the fifth anniversary
thereof (the “Initial Term”), provided that, on the fourth anniversary and each anniversary
of the Effective Date thereafter, the employment period shall be extended by one year unless at
least 30 days prior to such anniversary, the Company or the Executive delivers a written notice (a
“Notice of Non-Renewal”) to the other Party that the employment period shall not be extended (the
Initial Term as so extended, the “Employment Period”).

     3. Terms of Employment. (a) Position and Duties. (i) During the Employment
Period, (A) the Executive shall serve as the Chief Executive Officer, with such duties and
responsibilities as are commensurate with such positions, reporting directly to the Board, and (B)
the Executive’s principal location of employment shall be at the principal headquarters of the
Company; provided, that the Executive may be required under reasonable business
circumstances to travel outside of such location in connection with performing his duties under
this Agreement. In addition, the Company shall cause the Executive to be elected as Chairman of
the Board as of the Effective Date, and during the Employment Period, the Executive shall remain on
the Board and as Chairman of the Board, subject to Section 4(g), and shall perform his duties as a
director of the Company conscientiously and faithfully.

          (ii) The Executive agrees that during the Employment Period, he shall devote substantially all
of his business time, energies and talents to serving as the Company’s Chief Executive Officer and
Chairman of the Board, perform his duties conscientiously and

 

 

faithfully subject to the lawful
directions of the Board, and in accordance with each of the Company’s corporate governance and
ethics guidelines, conflict of interests policies and code of conduct (collectively, the “Company
Policies”). During the Employment Period, it shall not be a violation of this Agreement for the
Executive, subject to the requirements of Section 7, to (A) serve on corporate, civic or charitable
boards or committees, provided, that, without the written approval of the Board, the
Executive shall be permitted to serve on no more than one such corporate board, (B) deliver
lectures or fulfill speaking engagements and (C) manage personal investments, so long as such
activities do not interfere with the performance of the Executive’s responsibilities as the Chief
Executive Officer or as Chairman of the Board of the Company or violate any Company Policies.

          (iii) The Executive acknowledges and agrees that he shall at all times during his service with
the Company be subject to the Motorola Stock Ownership Requirements, as may be in effect from time
to time, which currently require that the Executive maintain holdings of the Company’s common stock
(“Common Stock”) in an amount at least equal to four times the Executive’s Annual Base Salary (as
defined below). In connection with such requirements, the Executive shall purchase 75,000 shares
of Common Stock on or prior to July 31, 2005, provided, that, 25,000 of such shares shall be
purchased on or prior to July 31, 2004 and another 25,000 of such shares shall be purchased on or
prior to January 31, 2005.

     (b) Compensation.

          (i) Base Salary. During the Employment Period, the Executive shall receive an
annualized base salary (“Annual Base Salary”) of not less than $1,500,000, payable pursuant to the
Company’s normal payroll practices. During the Employment Period, the current Annual Base Salary
shall be reviewed for increase only at such time as the salaries of senior officers of the Company
are reviewed generally, provided that, the Executive’s first such review shall occur no
earlier than calendar year 2005.

          (ii) Annual Bonus. For each fiscal year completed during the Employment Period, the
Executive shall be eligible to receive an annual cash bonus (“Annual Bonus”) based upon performance
targets that are established by the Compensation and Leadership Committee of the Board (the
“Committee”), provided that, the Executive’s target Annual Bonus shall be not less than
135% of his Annual Base Salary (the “Target Bonus”). Payment of the Target Bonus shall be
guaranteed for fiscal year 2004 (the “Guaranteed Bonus”). The Executive has agreed to defer
receipt of the Guaranteed Bonus pursuant to the terms of the Company’s Management Deferred
Compensation Plan until after the Executive’s Date of Termination (as defined below). However,
notwithstanding the immediately preceding sentence, the Executive shall not be required to defer
receipt of the Guaranteed Bonus beyond the first day on which the deductibility of the Guaranteed
Bonus by the Company is no longer precluded by the provisions of Section 162(m) of the Internal
Revenue Code of 1986, as amended (the “Code”), and in no event shall the Executive be required to
defer receipt beyond January 1 of the year following the year in which his Date of Termination (as
defined below) occurs.

          (iii) Mid-Range Incentive Plan. For each multi-year period (as recommended by
management and determined by the Committee) completed during the Employment Period, the Executive
shall be eligible to receive an award (“Mid-Range Incentive Plan Award”)

-2-

 

based upon performance
targets that are established by the Committee, provided that, the Executive’s target
Mid-Range Incentive Plan Award shall be not less than 250% of his Annual Base Salary.

          (iv) Long-Term Incentive Awards. As determined by the Committee, the Executive shall
be eligible for grants of equity compensation awards under the Company’s long term incentive
compensation arrangements in accordance with the Company’s policies, as in effect from time to
time. Except for grants with respect to fiscal year 2004 as set forth below, all grants of equity
compensation awards shall be made in the discretion of the Committee based upon performance of the
Executive and the Company and the Company’s compensation philosophy.

       A. 2004 Stock Option. In May 2004, the Executive shall be granted an option
(the “2004 Stock Option”) to purchase a number of shares of common stock of the Company (the
“Common Stock”) for fiscal year 2004 pursuant to the Company’s Omnibus Incentive Plan of
2003 (the “Incentive Plan”) having an aggregate Black-Scholes value of $6,250,000. The
Black-Scholes value to be calculated under this Section 3(b)(iv)(A) shall be determined on
the 2004 Stock Option grant date in a manner consistent with the methodology used by Hewitt
Associates for valuing stock options granted to employees of its publicly traded clients
during the year 2003. The 2004 Stock Option shall have a per share exercise price equal to
the closing price of a share of Common Stock on the last trading day prior to the date of
grant as reported in the Wall Street Journal (the “Fair Market Value”), a ten-year term and
a vesting schedule such that the 2004 Stock Option will become exercisable in four equal
annual installments commencing on the first anniversary of the date of grant, provided that,
the Executive remains in the employ of the Company through each such date. Except as
specifically provided herein, the terms and conditions of the 2004 Stock Option shall be
subject to the terms of the Incentive Plan and the award agreement evidencing the grant of
the 2004 Stock Option, as provided to senior executives of the Company generally.

       B. 2004 Restricted Stock Units. In May 2004, the Executive shall be granted an
award of a number of restricted stock units (the “Restricted Stock Units”) based on shares
of Common Stock for fiscal year 2004 pursuant to the Incentive Plan equal to the quotient
obtained by dividing (i) $2,000,000 by (ii) the Fair Market Value on the date of grant. The
Restricted Stock Units shall vest 10% on the first anniversary of the date of grant, 20% on
the second anniversary of the date of grant, 30% on the third anniversary of the date of
grant and 40% on the fourth anniversary of the date of grant, provided that, the
Executive remains in the employ of the Company through each such date. The Executive has
agreed to defer receipt of the settlement of any Restricted Stock Units until the later of
(i) the first day on which the deductibility of the settlement by the Company is no longer
precluded by the provisions of Section 162(m) of the Code, or (ii) the six-month anniversary
of the date of the Executive’s Separation from Service (as defined in Section
409A(a)(2)(A)(i) of the Code), if deferral to such anniversary date is required to comply
with the provisions of Section 409A of the Code. Except as specifically provided herein,
the terms and conditions of the Restricted Stock Units shall be subject to the terms of the
Incentive Plan and the award agreement evidencing the grant of the Restricted Stock Units,
as provided to senior executives of the Company generally. Not-

-3-

 

withstanding anything in this
Section 3(b)(iv)(B) to the contrary, the Executive shall be entitled to immediate settlement
of any outstanding Restricted Stock Units to the extent such Restricted Stock Units are
required to be included in the Executive’s income pursuant to Section 409A of the Code.

       C. Effective Date Stock Option. On the Effective Date, the Company shall grant
to the Executive a stock option pursuant to the Incentive Plan to purchase 1,350,000 shares
of Common Stock (the “Effective Date Stock Option”). The Effective Date Stock Option shall
have a per share exercise price equal to the Fair Market Value on the Effective Date, a
ten-year term and will vest in four equal annual installments commencing on the first
anniversary of the date of grant, provided that, the Executive remains in the employ
of the Company through each such date. Except as specifically provided herein, the terms
and conditions of the Effective Date Stock Option shall be subject to the terms of the
Incentive Plan and the award agreement evidencing the grant of the Effective Date Stock
Option, as provided to senior executives of the Company generally.

       D. Effective Date Restricted Stock Units. On the Effective Date, the Company
shall grant to the Executive 400,000 Restricted Stock Units under the Incentive Plan (the
“Effective Date Restricted Stock Units”). The restrictions with respect to the Effective
Date Restricted Stock Units shall lapse 50% on the second anniversary of the Effective Date
and the remainder shall lapse on the fourth anniversary of the Effective Date,
provided that, the Executive remains in the employ of the Company through each such
date. The Executive has agreed to defer receipt of the settlement of any Effective Date
Restricted Stock Units until the later of (i) the first day on which the deductibility of
the settlement by the Company is no longer precluded by the provisions of Section 162(m) of
the Code, or (ii) the six-month anniversary of the date of the Executive’s Separation from
Service, if deferral to such anniversary date is required to comply with the provisions of
Section 409A. Except as specifically provided herein, the terms and conditions of the
Effective Date Restricted Stock Units shall be subject to the terms of the Incentive Plan
and the award agreement evidencing the grant of the Effective Date Restricted Stock Units,
as provided to senior executives of the Company generally. Notwithstanding anything in this
Section 3(b)(iv)(D) to the contrary, the Executive shall be entitled to immediate settlement
of any outstanding Restricted Stock Units to the extent such Restricted Stock Units are
required to be included in the Executive’s income pursuant to Section 409A of the Code.

          (v) Pension Plans. During the Employment Period, the Executive shall be eligible for
participation in the qualified pension plans, practices, policies and programs of the Company, as
may be in effect from time to time, for senior executives of the Company generally.

          (vi) Other Benefits. During the Employment Period, the Executive shall be eligible
for participation in the welfare, perquisites, fringe benefit, and other benefit plans, practices,
policies and programs, as may be in effect from time to time, for senior executives of the Company
generally; provided, that, any severance payments or benefits to be received under any severance
benefit plans, practices, policies and programs shall be offset and reduced by any severance
benefits or payments received under this Agreement. The fringe bene-

-4-

 

fits and perquisites described
in the preceding sentence shall include: reasonable use of Company aircraft for personal and
business purposes (not less than 100 flight hours annually for personal use); participation in the
Company’s Elected Officer Life Insurance Program; relocation benefits on a tax-neutral basis
(including, but not limited to, providing a suitable, furnished apartment to the Executive for
transition housing for up to 12 months); and, at the level generally provided for the chief
executive officer of the Company, financial planning; an automobile allowance; personal security;
and a home security system.

          (vii) Change in Control Benefits. The Executive shall be eligible for participation
in the Motorola, Inc. Senior Officer Change in Control Severance Plan or any successor change in
control plan or program (the “Change in Control Plan”), as may be in effect from time to time, for
senior executives of the Company generally. At all times during the Employment Period, the Company
will maintain the Change in Control Plan as in effect on the Effective Date, or provide the
Executive with no less favorable benefits and protection under an alternative program or
arrangement. Additionally, upon a Change in Control (as defined in the Change in Control Plan),
all equity-based awards granted to the Executive on or after the Effective Date (including, without
limitation, the 2004 Stock Option, the Restricted Stock Units, the Effective Date Stock Option and
the Effective Date Restricted Stock Units) shall become fully vested and exercisable (or, if
applicable, all restrictions shall lapse), all performance goals shall be deemed achieved at target
levels, all Performance Stock (as defined in the Incentive Plan) shall be delivered as promptly as
practicable and all performance units, restricted stock units and other incentive awards shall be
paid out as promptly as practicable; provided, however, that the treatment of outstanding awards
set forth above (referred to herein as “Accelerated Treatment”) shall not apply if and to the
extent that such awards are assumed by the successor corporation (or parent thereof) or are
replaced with awards that preserve the existing value of such awards at the time of the Change in
Control and provide for subsequent payout in accordance with the same vesting schedule applicable
to the original awards; provided, further, that with respect to any awards that are assumed or
replaced, such assumed or replaced awards shall provide for the Accelerated Treatment if the
Executive is involuntarily terminated (for a reason other than Cause) or if the Executive quits for
Good Reason within 24 months of the Change in Control. Notwithstanding the foregoing, if the
Company adopts an equity incentive plan with Change in Control benefits more generous than the
benefits provided in this Section 3(b)(vii) or a Change in Control severance plan for senior
executives generally with more generous benefits than the Change in Control Plan, the Executive
will be entitled to those more generous benefits to the extent Executive’s awards are granted under
such plan or such Change in Control severance plan is adopted, as applicable.

          (viii) Expenses. During the Employment Period, the Executive shall be eligible for
prompt reimbursement for business expenses reasonably incurred by the Executive in accordance with
the Company’s policies, as may be in effect from time to time, for its senior executives generally.

          (ix) Vacation. During the Employment Period, the Executive shall be eligible for paid
vacation in accordance with the Company’s policies, as may be in effect from time to time, for its
senior executives generally.

-5-

 

          (x) Signing Bonus. In connection with the replacement of outstanding amounts at his
current employer that will be forfeited, on the Effective Date, the Company shall pay to the
Executive a lump sum cash payment of $600,000. In addition, on the Effective Date, the Company
shall grant to the Executive the number of restricted shares of Company Common Stock under the
Incentive Plan (the “Effective Date Restricted Stock”) determined by dividing (a) $1,400,000 by (b)
the per-share fair market value of Company Common Stock as of the close of market on the Effective
Date, rounded up to the nearest whole share. The restrictions with respect to the Effective Date
Restricted Stock shall lapse 100% on the second anniversary of the Effective Date, provided
that, the Executive remains in the employ of the Company through such date. Except as specifically
provided herein, the terms and conditions of the Effective Date Restricted Stock shall be subject
to the terms of the Incentive Plan and the award agreement evidencing the grant of the Effective
Date Restricted Stock, as provided to senior executives of the Company generally.

     (c) Other Entities. The Executive agrees to serve, without additional compensation,
as an officer and director for each of the Company’s subsidiaries, partnerships, joint ventures,
limited liability companies and other affiliates, including entities in which the Company has a
significant investment (collectively, the Company and such entities, the “Affiliated Group”), as
determined by the Company. As used in this Agreement, the term “affiliates” shall include any
entity controlled by, controlling, or under common control with the Company.

     4. Termination of Employment. (a) Death or Disability. The Executive’s
employment shall terminate automatically upon the Executive’s death during the Employment Period.
If the Company determines in good faith that the Disability of the Executive has occurred during
the Employment Period (pursuant to the definition of Disability set forth below), it may provide
the Executive with written notice in accordance with Section 9(b) of this Agreement of its
intention to terminate the Executive’s employment. In such event, the Executive’s employment with
the Company shall terminate effective on the 30th day after receipt of such notice by the Executive
(the “Disability Effective Date”), provided that, within the 30-day period after such
receipt, the Executive shall not have returned to full time performance of the Executive’s duties.
For purposes of this Agreement, “Disability” shall mean the inability of the Executive to perform
his duties with the Company on a full-time basis for 120 consecutive days or for 180 intermittent
days in any one-year period as a result of incapacity due to mental or physical illness which is
determined to be total and permanent by a licensed physician selected by the Company or its
insurers and reasonably acceptable to the Executive or the Executive’s legal representative. If
the Parties cannot agree on a licensed physician, each Party shall select a licensed physician and
the two physicians shall select a third who shall be the approved licensed physician for this
purpose.

     (b) Cause. The Company may terminate the Executive’s employment during the Employment
Period with or without Cause. For purposes of this Agreement, “Cause” shall mean:

          (i) the Executive’s willful and continued failure to substantially perform his duties under
this Agreement, other than any such failure resulting from incapacity due to physical or mental
illness, which failure has continued for a period of at least
30 days follow-

-6-

 

ing delivery to the
Executive of a written demand for substantial performance specifying the manner in which the
Executive has failed to substantially perform; or

          (ii) the Executive’s willful engagement in (A) in any malfeasance, dishonesty or fraud that is
intended to or does result in the Executive’s substantial personal enrichment or a material
detrimental effect on the Company’s reputation or business; or (B) gross misconduct;

          (iii) the Executive’s indictment for, or plea of guilty or nolo contendere to (A) a felony in
the United States or (B) to a felony outside the United States, which, regardless of where such
felony occurs, the Board reasonably believes has had or will have a detrimental effect on the
Company’s reputation or business or the Executive’s reputation; or

          (iv) the Executive’s material breach of Section 7 or Section 12 of this Agreement.

A termination of employment of the Executive shall not be deemed to be for Cause unless and until
there shall have been delivered to the Executive a copy of a resolution duly adopted by the
affirmative vote of not less than a majority of the entire membership of the Board (not including
the Executive) at a meeting of the Board called and held for such purpose (after at least ten days’
written notice is provided to the Executive and the Executive is given an opportunity, together
with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board,
the Executive is guilty of the conduct described in one or more of the clauses of Section 4(b)
above, and specifying the particulars thereof in detail.

     (c) Good Reason. The Executive’s employment may be terminated by the Executive for
Good Reason if (x) an event or circumstance set forth in the clauses of this Section 4(c) below
shall have occurred and the Executive provides the Company with written notice thereof within 15
days after the Executive has knowledge of the occurrence or existence of such event or
circumstance, which notice shall specifically identify the event or circumstance that the Executive
believes constitutes Good Reason, (y) the Company fails to correct the circumstance or event so
identified within 30 days after the receipt of such notice, and (z) the Executive resigns within 90
days after the date of delivery of the notice referred to in clause (x) above. For purposes of
this Agreement, “Good Reason” shall mean, in the absence of the Executive’s written consent (and
except in consequence of a prior termination of the Executive’s employment), the occurrence of any
of the following:

          (i) a reduction by the Company in the Executive’s Annual Base Salary or a reduction in the
Executive’s Target Bonus as a percentage of the Executive’s Annual Base Salary; or

          (ii) a material reduction in the aggregate level of employee benefits made available to the
Executive when compared to the benefits made available to the Executive at any time during the
Employment Period, unless such reduction is applicable to senior executives of the Company
generally; or

          (iii) the failure of the Executive to be appointed as Chief Executive Officer or Chairman of
the Board or, except as required by applicable law or regulation, his re-

-7-

 

moval from either of such
positions (other than pursuant to Section 4(g) or pursuant to a termination of the Executive’s
employment for death, Disability or Cause); or

          (iv) the failure of the Company to elect or reelect the Executive to the Board; or

          (v) a material diminution in the Executive’s duties or responsibilities (other than as
required by applicable law or regulation or as a result of the Executive’s physical or mental
incapacity which impairs his ability to materially perform his duties or responsibilities as
confirmed by a doctor reasonably acceptable to the Executive or his representative and such
diminution lasts only for so long as such doctor determines such incapacity impairs the Executive’s
ability to materially perform his duties or responsibilities) as Chief Executive Officer of the
Company; or

          (vi) except as required by applicable law or regulation, a material change in the Executive’s
reporting relationship so that the Executive no longer reports solely to the Board in his position
as Chief Executive Officer; or

          (vii) the Company requiring the Executive’s principal location of employment to be at any
office or location more than 35 miles from the principal headquarters of the Company (other than to
the extent agreed to or requested by the Executive).

     (d) Voluntary Termination. The Executive may voluntarily terminate his employment
without Good Reason (other than due to death, Disability or retirement), and such termination shall
not be deemed to be a breach of this Agreement.

     (e) Notice of Termination. Any termination by the Company for Cause, or by the
Executive for Good Reason, shall be communicated by Notice of Termination to the other Party hereto
given in accordance with Section 9(b) of this Agreement. For purposes of this Agreement, a “Notice
of Termination” means a written notice which (i) indicates the specific termination provision in
this Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the Executive’s employment
under the provision so indicated and (iii) if the Date of Termination (as defined below) is other
than the date of receipt of such notice, specifies the termination date (which date shall be not
more than thirty days after the giving of such notice). The failure by the Executive or the
Company to set forth in the Notice of Termination any fact or circumstance which contributes to a
showing of Good Reason or Cause shall not waive any right of the Executive or the Company,
respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such
fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.

     (f) Date of Termination. “Date of Termination” means (i) if the Executive’s
employment is terminated by the Company for Cause, or by the Executive for Good Reason, the date of
receipt of the Notice of Termination or any later date specified therein within 30 days of such
notice, as the case may be, (ii) if the Executive’s employment is terminated by the Company other
than for Cause or Disability, or if the Executive voluntarily resigns without Good Reason, the date
on which the terminating Party notifies the other Party of such termination, (iii)

-8-

 

if the
Executive’s employment is terminated by reason of death, the date of death of the Executive, (iv)
if the Executive’s employment is terminated by the Company due to Disability, the Disability
Effective Date, or (v) if the Executive’s employment is terminated by the Executive or the Company
as a result of a Notice of Non-Renewal, the end of the applicable Employment Period.

     (g) Resignation from All Positions. Notwithstanding any other provision of this
Agreement, upon the termination of the Executive’s employment for any reason, unless otherwise
requested by the Board, the Executive shall immediately resign as of the Date of Termination from
all positions that he holds or has ever held with the Company and any other member of the
Affiliated Group (and with any other entities with respect to which the Company has requested the
Executive to perform services), including, without limitation, the Board and all boards of
directors of any member of the Affiliated Group. The Executive hereby agrees to execute any and
all documentation to effectuate such resignations upon request by the Company, but he shall be
treated for all purposes as having so resigned upon termination of his employment, regardless of
when or whether he executes any such documentation.

     5. Obligations of the Company upon Termination. (a) Good Reason; Other Than for
Cause. If, during the Employment Period, (1) the Company shall terminate the Executive’s
employment other than for Cause, death or Disability, or (2) the Executive shall terminate
employment for Good Reason:

          (i) the Company shall pay to the Executive in a lump sum in cash within 30 days (except as
specifically provided in Section 5(a)(i)(A)(3)) after the Date of Termination the aggregate of the
following amounts; provided that, part or all of such lump sum payment shall be deferred until the
six-month anniversary of the date of the Executive’s Separation from Service, if deferral to such
anniversary date is required to comply with the provisions of Section 409A of the Code:

       A. the sum of (1) the Executive’s Annual Base Salary and any accrued vacation pay
through the Date of Termination, (2) the Executive’s business expenses that are reimbursable
pursuant to Section 3(b)(viii) but have not been reimbursed by the Company as of the Date of
Termination, and (3) the Executive’s Annual Bonus for the fiscal year immediately preceding
the fiscal year in which the Date of Termination occurs if such bonus has been determined
but not paid as of the Date of Termination (at the time such Annual Bonus would otherwise
have been paid); and

       B. the amount equal to the product of (x) two and (y) the sum of (I) the Executive’s
Annual Base Salary and (II) the Target Bonus; and

          (ii) for two years after the Executive’s Date of Termination (the “Continuation Period”), the
Company shall continue medical and life insurance benefits to the Executive and, if applicable, the
Executive’s family at least equal to those that would have been provided to them in accordance with
the plans, programs, practices and policies of the Company if the Executive’s employment had not
been terminated; provided, that the Executive continues to make all required contributions;
provided, however, that, if the Executive becomes re-employed with another employer
and is eligible to receive substantially equivalent health or life insurance

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benefits under another
employer-provided plan, the health benefits or life insurance described herein, whichever is
applicable, shall no longer be provided by the Company; and

          (iii) the 2004 Stock Option, the Effective Date Stock Option, the Restricted Stock Units, the
Effective Date Restricted Stock Units, the Effective Date Restricted Stock and all other
outstanding equity-based awards granted to the Executive on or after the Effective Date shall
continue to vest and, with respect to stock options and other awards that are not immediately
exercisable, become exercisable pursuant to their respective terms on the applicable scheduled
vesting dates, so long as the Executive complies with the provisions of Section 7 of this Agreement
and any other applicable provisions of the applicable award agreement and the Incentive Plan (other
than continued service). Subject to the immediately preceding sentence, all such awards shall
remain exercisable by the Executive following vesting until the earlier of (A) eighteen months
following the later to occur of (x) the applicable vesting date of such award or (y) the
Executive’s Date of Termination or (B) the expiration of the scheduled term of such award, as
applicable; and

          (iv) to the extent not theretofore paid or provided, the Company shall timely pay or provide
to the Executive any other amounts or benefits required to be paid or provided or which the
Executive is eligible to receive under any plan, program, policy or practice or contract or
agreement (other than any severance plan, program, policy or practice or contract or agreement) of
the Company and its affiliates (such amounts and benefits, the “Other Benefits”) in accordance with
the terms and normal procedures of each such plan, program, policy or practice, based on accrued
benefits through the Date of Termination.

Except with respect to payments and benefits under Sections 5(a)(i)(A)(1), 5(a)(i)(A)(2) and
5(a)(iv), all payments and benefits to be provided under this Section 5(a) shall be subject to the
Executive’s execution and non-revocation of a release substantially in the form attached hereto as
Exhibit A.

     (b) Cause; Other than for Good Reason. If the Executive’s employment shall be
terminated for Cause or the Executive terminates his employment without Good Reason during the
Employment Period, or the Executive’s employment terminates by reason of either Party providing to
the other Party a Notice of Non-Renewal, this Agreement shall terminate without further obligations
to the Executive other than the obligation to pay or provide to the Executive an amount equal to
the amount set forth in clauses (1), (2) and (3) of Section 5(a)(i)(A) above, and the timely
payment or provision of the Other Benefits, in each case to the extent theretofore unpaid, and
provide to the Executive the opportunity to continue to exercise outstanding equity awards, granted
on or after the Effective Date, to the extent vested on the date of such termination, pursuant to
the provisions of the applicable award agreement.

     (c) Death. If the Executive’s employment is terminated by reason of the Executive’s
death during the Employment Period, this Agreement shall terminate without further obligations to
the Executive’s legal representatives under this Agreement, other than the obligation to pay or
provide to the Executive’s beneficiaries an amount equal to the amount set forth in clauses (1),
(2) and (3) of Section 5(a)(i)(A) above, the vesting of each stock option, restricted share and
restricted stock unit award that is outstanding as of the Date of Termination and continued
exercisability of each stock option by the Executive’s beneficiaries until the earlier of (i)

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one
year after the Date of Termination or (ii) the end of the scheduled term of such option (the “Stock
Benefits”).

     (d) Disability. If the Executive’s employment is terminated by reason of the
Executive’s Disability during the Employment Period, this Agreement shall terminate without further
obligations to the Executive, other than the obligation to pay or provide to the Executive an
amount equal to the amount set forth in clauses (1), (2) and (3) of Section 5(a)(i)(A) above, the
provision of the Stock Benefits and the timely payment or provision of Other Benefits, including
any applicable disability benefits.

     6. Full Settlement. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable to the Executive
under any of the provisions of this Agreement and such amounts shall not be reduced as a result of
a mitigation duty whether or not the Executive obtains other employment. To the extent permitted
by applicable law, the Company shall pay directly to the Executive all reasonable legal fees and
expenses reasonably incurred by the Executive in connection with the negotiation and preparation of
this Agreement, subject to a maximum of $50,000, and the Company shall reimburse the Executive for
all legal costs and expenses reasonably incurred (and documented in invoices) in connection with
any dispute under this Agreement, so long as the Executive prevails in such dispute on at least one
material issue. In addition, the Company shall indemnify and hold the Executive, harmless on an
after-tax basis, for any income tax, and all other applicable taxes imposed as a result of the
Company’s payment of any legal fees contemplated herein in connection with the preparation and
negotiation of this Agreement.

     7. Covenants.

     (a) Confidential Information. The Executive shall hold in a fiduciary capacity for
benefit of the Affiliated Group, all secret or confidential information, knowledge or data relating
to the Affiliated Group and its businesses (including, without limitation, any proprietary and not
publicly available information concerning any processes, methods, trade secrets, research or secret
data, costs, names of users or purchasers of their respective products or services, business
methods, operating procedures or programs or methods of promotion and sale) that the Executive
obtains during the Executive’s employment by the Affiliated Group that is not public knowledge
(other than as a result of the Executive’s violation of this Section 7(a)) (“Confidential
Information”). The Executive shall not communicate, divulge or disseminate Confidential
Information at any time during or after the Executive’s employment with the Affiliated Group,
except with prior written consent of the Company, or as otherwise required by law or legal process
or as such disclosure or use may be required in the course of the Executive performing his duties
and responsibilities as the Chief Executive Officer and Chairman of the Board of the Company.
Notwithstanding the foregoing provisions, if the Executive is required to disclose any such
confidential or proprietary information pursuant to applicable law or a subpoena or court order,
the Executive shall promptly notify the Company in writing of any such requirement so that the
Company or the appropriate member of the Affiliated Group may seek an appropriate protective order
or other appropriate remedy or waive compliance with the provisions hereof. The Executive shall
reasonably cooperate with the Affiliated Group to obtain such a protective order or other remedy.
If such order or other remedy is not obtained prior to the time the Executive is required to make
the disclosure, or the Company waives compliance with the provisions hereof,

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the Executive shall
disclose only that portion of the confidential or proprietary information which he is advised by
counsel in writing (either his or the Company’s) that he is legally required to so disclose. Upon
his termination of employment with the Company for any reason, the Executive shall promptly return
to the Company, all records, files, memoranda, correspondence, notebooks, notes, reports, customer
lists, drawings, plans, documents, and other documents and the like relating to the business of the
Affiliated Group or containing any trade secrets relating to the Affiliated Group or that the
Executive uses, prepares or comes into contact with during the course of the Executive’s employment
with the Company, and all keys, credit cards and passes, and such materials shall remain the sole
property of the Company and/or the Affiliated Group, as applicable. For purposes of the preceding
sentence, the term “trade secrets” shall have the meaning ascribed to it under the Illinois Trade
Secrets Act or, if such act is repealed, the Uniform Trade Secrets Act (on which the Illinois Trade
Secrets Act is based). The Executive agrees to represent in writing to the Company upon
termination of employment that he has complied with the foregoing provisions.

     (b) Non-Recruitment of Affiliated Group Employees. The Executive shall not, at any
time during the Restricted Period (as defined in this Section 7(b)), without the prior written
consent of the Company, directly or indirectly, solicit, recruit, or employ (whether as an
employee, officer, agent, consultant or independent contractor) any person who is or was at any
time during the 120 days prior to Executive’s termination of employment, an employee,
representative, officer or director of any member of the Affiliated Group and who possesses
confidential information of the Affiliated Group. Further, during the Restricted Period, the
Executive shall not take any action that could reasonably be expected to have the effect of
directly encouraging or inducing any person to cease their relationship with any member of the
Affiliated Group for any reason, except for terminations of employment in the ordinary course of
business. This Section 7(b) shall not apply to (i) recruitment of employees for the Affiliated
Group, (ii) the Executive’s personal administrative staff who perform secretarial-type functions or
(iii) the hiring of any person (in the absence of a solicitation or recruitment by the Executive)
unless (A) the person was one of the Executive’s direct reports, (B) the Executive had material or
frequent contact with such person in furtherance of the performance of the duties of such person or
the Executive, or (C) the Executive, prior to the Date of Termination, actively participated in the
recruitment or hiring of such person at the Company other than merely approving any of the terms of
such person’s employment. Additionally, a general employment advertisement by an entity of which
the Executive is a part will not constitute solicitation or recruitment. The “Restricted Period”
shall mean the period of the Executive’s employment with the Company and its subsidiaries through
the second anniversary of the Date of Termination for any reason.

     (c) No Competition — Solicitation of Business. During the Restricted Period, the
Executive shall not, either directly or indirectly, compete with the business of the Company by (i)
becoming an officer, agent, employee, partner or director of any other corporation, partnership or
other entity, or otherwise render services to or assist or hold an interest (except as a less than
3-percent shareholder of a publicly traded corporation or as a less than 5-percent shareholder of a
corporation that is not publicly traded) in any Competitive Business (as defined below), or (ii)
soliciting, servicing, or accepting the business of (A) any active customer of any member of the
Affiliated Group, or (B) any person or entity who is or was at any time during the previous twelve
months a customer of any member of the Affiliated Group, provided that such business is competitive
with any significant business of any member of the Affiliated Group.

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“Competitive Business” shall
mean any person or entity (including any joint venture, partnership, firm, corporation, or limited
liability company) that engages in any principal or significant business of the Company or any of
its subsidiaries as of the Date of Termination for any reason (or any material or significant
business being actively pursued as of the Date of Termination that the Company or any of its
subsidiaries enter during the Restricted Period).

     (d) Assistance. The Executive agrees that during and after his employment by the
Company, the Executive will assist the Affiliated Group in the defense of any claims, or potential
claims that may be made or threatened to be made against any member of the Affiliated Group in any
action, suit or proceeding, whether civil, criminal, administrative, investigative or otherwise (a
“Proceeding”), and will assist the Affiliated Group in the prosecution of any claims that may be
made by any member of the Affiliated Group in any Proceeding, to the extent that such claims may
relate to the Executive’s employment or the period of the Executive’s employment by the Company.
The Executive agrees, unless precluded by law, to promptly inform the Company if the Executive is
asked to participate (or otherwise become involved) in any Proceeding involving such claims or
potential claims. The Executive also agrees, unless precluded by law, to promptly inform the
Company if the Executive is asked to assist in any investigation (whether governmental or
otherwise) of any member of the Affiliated Group (or their actions), regardless of whether a
lawsuit has then been filed against any member of the Affiliated Group with respect to such
investigation. The Company agrees to reimburse the Executive for all of the Executive’s reasonable
out-of-pocket expenses associated with such assistance, including travel expenses and any
attorneys’ fees and shall pay a reasonable per diem fee for the Executive’s service. In addition,
the Executive agrees to provide such services as are reasonably requested by the Company to assist
any successor to the Executive in the transition of duties and responsibilities to such successor.
Any services or assistance contemplated in this Section 7(d) shall be at mutually agreed to and
convenient times.

     (e) Remedies. The Executive acknowledges and agrees that the terms of Section 7: (i)
are reasonable in geographic and temporal scope, (ii) are necessary to protect legitimate
proprietary and business interests of the Company in, inter alia, near permanent
customer relationships and confidential information. The Executive further acknowledges and agrees
that in addition to all other remedies at law and/or equity, (x) the Executive’s breach of the
provisions of Section 7 will cause the Company irreparable harm, which cannot be adequately
compensated by money damages, and (y) if the Company elects to prevent the Executive from breaching
such provisions by obtaining an injunction against the Executive, there is a reasonable probability
of the Company’s eventual success on the merits. The Executive consents and agrees that if the
Executive commits any such breach or threatens to commit any breach, the Company shall be entitled
to temporary and permanent injunctive relief from a court of competent jurisdiction, in addition
to, and not in lieu of, such other remedies as may be available to the Company for such breach,
including the recovery of money damages. The Parties further acknowledge and agree that the
provisions of Section 7(a) below are accurate and necessary because (A) this Agreement is entered
into in the State of Illinois, (B) as of the Effective Date, Illinois will have a substantial
relationship to the Parties and to this transaction, (C) as of the Effective Date, Illinois will be
the headquarters state of the Company, which has operations nationwide and has a compelling
interest in having its employees treated uniformly within the United States, (D) the use of
Illinois law provides certainty to the Parties in any covenant litigation in the United States, and
(E) enforcement of the provision of this Section 7 would not violate any fundamental public policy
of Illi-

-13-

 

nois or any other jurisdiction. If any of the provisions of Section 7 are determined to be
wholly or partially unenforceable, the Executive hereby agrees that this Agreement or any provision
hereof may be reformed so that it is enforceable to the maximum extent permitted by law. If any of
the provisions of this Section 7 are determined to be wholly or partially unenforceable in any
jurisdiction, such determination shall not be a bar to or in any way diminish the Company’s right
to enforce any such covenant in any other jurisdiction.

     (f) The covenants in this Section 7 apply in the countries in which Executive has physically
been present performing work for the Company at any time during the two years preceding termination
of his employment.

     8. Successors. (a) This Agreement is personal to the Executive and without the prior
written consent of the Company shall not be assignable by the Executive other than by will or the
laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable
by the Executive’s legal representatives. This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns.

     (b) The Company shall cause any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all or a substantial portion of its business
and/or assets to assume expressly and agree to perform this Agreement immediately upon such
succession in the same manner and to the same extent that the Company would be required to perform
it if no such succession had taken place. As used in this Agreement, “Company” shall mean the
Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which
assumes and agrees to perform this Agreement by operation of law, or otherwise.

     9. Miscellaneous. (a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Illinois, without reference to principles of conflict of laws. The
Parties hereto irrevocably agree to submit to the jurisdiction and venue of the courts of the State
of Illinois, in any action or proceeding brought with respect to or in connection with this
Agreement. The captions of this Agreement are not part of the provisions hereof and shall have no
force or effect. This Agreement may not be amended or modified otherwise than by a written
agreement executed by the Parties hereto or their respective successors and legal representatives.

     (b) All notices and other communications hereunder shall be in writing and shall be given by
hand delivery to the other Party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

If to the Executive:

At the most recent address on file for the Executive at the Company.

With a copy to:

Larry Sonsini, Esq.

John Aguirre, Esq.

Wilson Sonsini Goodrich & Rosati

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650 Page Mill Road

Palo Alto, CA 94304

If to the Company:

Motorola, Inc.

1303 East Algonquin Road

Schaumburg, IL 60196

Attention: General Counsel

With a copy to:

Michael S. Katzke, Esq.

Wachtell, Lipton, Rosen & Katz

51 West 52nd Street

New York, New York 10019

or to such other address as either Party shall have furnished to the other in

writing in accordance herewith. Notice and communications shall be effective when

actually received by the addressee.

     (c) The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.

     (d) Notwithstanding any other provision of this Agreement, the Company may withhold from any
amounts payable or benefits provided under this Agreement any Federal, state, and local taxes as
shall be required to be withheld pursuant to any applicable law or regulation.

     (e) Subject to the provisions of Section 4(c), the Executive’s or the Company’s failure to
insist upon strict compliance with any provision of this Agreement or the failure to assert any
right the Executive or the Company may have hereunder, shall not be deemed to be a waiver of such
provision or right or any other provision or right of this Agreement.

     (f) From and after the Effective Date, this Agreement shall supersede any other employment
agreement or understanding between the Parties, provided that, notwithstanding any other provision
of this Agreement to the contrary, in the event of a Change in Control (as defined in the Change in
Control Plan), the Change in Control Plan shall supersede this Agreement; provided, that, the
provisions in Section 3(b)(vii) will continue to apply.

     (g) The Company may not issue a press release or otherwise publicly disclose the Executive’s
employment or potential employment with the Company without Executive’s consent as to the content
and timing of such disclosure, which approval shall not be unreasonably withheld.

     10. Director’s and Officer’s Insurance. The Company shall provide the Executive with
reasonable Director’s and Officer’s insurance coverage that is at least as favorable

-15-

 

as the
coverage provided to other directors and officers of the Company. Such insurance coverage shall
continue in effect both during the Employment Period and, while potential liability exists,
thereafter.

     11. Indemnification. The Company shall indemnify the Executive and hold him harmless
to the fullest extent permitted by law and under the by-laws of the Company against, and in respect
to, any and all actions, suits, proceedings, claims, demands, judgments, costs, expenses (including
reasonable attorney fees), losses and damages resulting from the Executive’s good faith performance
of his duties and obligations with the Company.

     12. Representations. The Executive hereby represents and warrants to the Company that
the Executive is not party to any contract, understanding, agreement or policy, whether or not
written, with his current employer (or any other previous employer) or otherwise, that would be
breached by the Executive’s entering into, or performing services under, this Agreement. The
Executive further represents that he has disclosed to the Company in writing all material
threatened, pending, or actual claims that are unresolved and still outstanding as of the Effective
Date, in each case, against the Executive of which he is aware, if any, as a result of his
employment with his current employer (or any other previous employer) or his membership on any
boards of directors. Executive agrees that he has not, will not and cannot rely on any
representations not expressly made herein and the only consideration for signing this Employment
Agreement are the terms stated herein and no other promises or representations of any kind have
been made by any person or entity whatsoever to cause him to sign this Employment Agreement.

-16-

 

     IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from its Board of Directors, the Company has caused these presents to be executed in
its name and on its behalf, all as of the day and year first above written.

	 	 	 	 	 
	 	 	 
	 	 /s/ Edward J. Zander
 	 
	 	EXECUTIVE 	 
	 	 	 
	 
	 	MOTOROLA, INC.

 	 
	 	By:  	Samuel C. Scott III
 	 
	 	 	Title:  	Chair, Compensation and Leadership Committee 	 

-17-

 

	 	 	 	 	 

EXHIBIT A

Form of Release

     (a) In consideration for the payment of the severance described in the Executive employment
agreement with the Company (the “Employment Agreement”), dated as of [ ], the Executive for
himself, and for his heirs, administrators, representatives, executors, successors and assigns
(collectively “Releasers”) does hereby irrevocably and unconditionally release, acquit and forever
discharge the Company, its subsidiaries, affiliates and divisions and their respective, current and
former, trustees, officers, directors, partners, shareholders, agents, employees, consultants,
independent contractors and representatives, including without limitation all persons acting by,
through under or in concert with any of them (collectively, “Releasees”), and each of them from any
and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies,
damages, remedies, actions, causes of action, suits, rights, demands, costs, losses, debts and
expenses (including attorneys’ fees and costs) of any nature whatsoever, known or unknown, whether
in law or equity and whether arising under federal, state or local law and in particular including
any claim for discrimination based upon race, color, ethnicity, sex, age (including the Age
Discrimination in Employment Act of 1967), national origin, religion, disability, or any other
unlawful criterion or circumstance, which the Executive and Releasers had, now have, or may have in
the future against each or any of the Releasees, including under the Illinois Law Against
Discrimination (collectively “Executive/Releaser Actions”) from the beginning of the world until
the date hereof.

     (b) The Executive acknowledges that: (i) this entire Release is written in a manner
calculated to be understood by him; (ii) he has been advised to consult with an attorney before
executing this Release; (iii) he was given a period of twenty-one days within which to consider
this Release; and (iv) to the extent he executes this Release before the expiration of the
twenty-one day period, he does so knowingly and voluntarily and only after consulting his attorney.
The Executive shall have the right to cancel and revoke this Release by delivering notice to the
Company pursuant to the notice provision of Section 9 of the Employment Agreement prior to the
expiration of the seven-day period following the date hereof, and the severance benefits under the
Employment Agreement shall not become effective, and no payments or benefits shall be made or
provided thereunder, until the day after the expiration of such seven-day period (the “Revocation
Date”). Upon such revocation, this Release and the severance provisions of the Employment
Agreement shall be null and void and of no further force or effect.

     (c) Notwithstanding anything herein to the contrary, the sole matters to which the Release do
not apply are: (i) the Executive’s rights of indemnification and directors and officers liability
insurance coverage to which he was entitled immediately prior to ___with regard to his
service as an officer of the Company; (ii) the Executive’s rights under any tax-qualified pension
or claims for accrued vested benefits or rights under any other employee benefit plan, policy or
arrangement (whether tax-qualified or not) maintained by the Company or under COBRA; or (iii) the
Executive’s rights under Section 5 of the Employment Agreement which is intended to survive
termination of employment.

     (d) This Release is the complete understanding between the Executive and the Company in
respect of the subject matter of this Release and supersedes all prior agreements relating

 

 

to the
same subject matter. The Executive has not relied upon any representations, promises or agreements
of any kind except those set forth herein in signing this Release.

     (e) In the event that any provision of this Release should be held to be invalid or
unenforceable, each and all of the other provisions of this Release shall remain in full force and
effect. If any provision of this Release is found to be invalid or unenforceable, such provision
shall be modified as necessary to permit this Release to be upheld and enforced to the maximum
extent permitted by law.

     (f) This Release shall be governed by and construed in accordance with the laws of the State
of Illinois, without reference to principles of conflict of laws.

     (g) This Release inures to the benefit of the Company and its successors and assigns.

	 	 	 	 	 
	 	 	 
	 	  	 	 
	 	 	EXECUTIVE

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