Motorola 2005 Annual Report Download - page 125

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118
The following table summarizes net tangible and intangible assets acquired and the consideration provided for
the acquisitions identified above:
Years Ended December 31
2004
2003
Tangible net assets $39 $Ì
Goodwill 178 93
Other intangibles 55 54
In-process research and development 18 32
$290 $179
Consideration:
Cash $290 $179
Stock ÌÌ
$290 $179
MeshNetworks
In November 2004, the Company acquired MeshNetworks, Inc. (""MeshNetworks''), a developer of mobile
mesh networking and position location technologies that allow customers to deploy high-performance, Internet
Protocol-based wireless broadband networks, for $169 million in cash.
The Company recorded approximately $119 million in goodwill, none of which is expected to be deductible
for tax purposes, a $16 million charge for acquired in-process research and development, and $20 million in other
intangibles. The acquired in-process research and development will have no alternative future uses if the products
are not feasible. At the date of the acquisition, a total of three projects were in process. The average risk adjusted
rate used to value these projects was 45%. The allocation of value to in-process research and development was
determined using expected future cash flows discounted at average risk adjusted rates reflecting both technological
and market risk as well as the time value of money. These research and development costs were written off at the
date of acquisition and have been included in Other Charges in the Company's consolidated statements of
operations. Goodwill and intangible assets are included in Other Assets in the Company's consolidated balance
sheets. The intangible assets will be amortized over a period of 5 years on a straight-line basis.
The results of operations of MeshNetworks have been included in the Government and Enterprise Mobility
Solutions segment in the Company's consolidated financial statements subsequent to the date of acquisition. The
pro forma effects of this acquisition on the Company's consolidated financial statements were not significant.
Force Computers
In August 2004, the Company acquired Force Computers, (""Force''), a worldwide designer and supplier of
open, standards-based and custom embedded computing solutions, for $121 million in cash.
The Company recorded approximately $59 million in goodwill, none of which was deductible for tax
purposes, a $2 million charge for acquired in-process research and development, and $35 million in other
intangibles. The in-process research and development costs were written off at the date of acquisition and have
been included in Other Charges in the Company's consolidated statements of operations. Goodwill and intangible
assets are included in Other Assets in the Company's consolidated balance sheets. The intangible assets will be
amortized over a period of 5 years on a straight-line basis.
The results of operations of Force have been included in the Networks segment in the Company's consolidated
financial statements subsequent to the date of acquisition. The pro forma effects of this acquisition on the
Company's consolidated financial statements were not significant.
Winphoria Networks
In May 2003, the Company acquired Winphoria Networks, Inc. (""Winphoria''), a core infrastructure provider
of next-generation, packet-based mobile switching centers for wireless networks, for approximately $179 million in
cash.