Motorola 2006 Annual Report Download - page 32

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required to make larger contributions. The equity markets can be, and recently have been, very volatile, and
therefore our estimate of future contribution requirements can change dramatically in relatively short periods of
time. Similarly, changes in interest rates can impact our contribution requirements. In a low interest rate
environment, the likelihood of required contributions in the future increases.
Compliance with changing regulation of corporate governance and public disclosure may result in additional
expenses.
Compliance with changing laws, regulations and standards relating to corporate governance and public
disclosure, including the Sarbanes-Oxley Act of 2002, new SEC regulations and changes to the New York Stock
Exchange rules, has required us to expend significant resources and incur additional expenses and will continue to
do so. We are committed to maintaining the highest standards of corporate governance and public disclosure. As a
result, we will continue to invest necessary resources to comply with evolving laws, regulations and standards, and
this investment may continue to result in increased general and administrative expenses and a diversion of
management time and attention from revenue-generating activities.
The outcome of currently ongoing and future examinations of our income tax returns by the IRS.
We are subject to continued examination of our income tax returns by the Internal Revenue Service and other
tax authorities. We regularly assess the likelihood of adverse outcomes resulting from these examinations to
determine the adequacy of our provision for income taxes. There can be no assurance that the outcomes from
these continuing examinations will not have an adverse effect on future operating results.
Item 1B: Unresolved Staff Comments
None.
Item 2: Properties
Motorola's principal executive offices are located at 1303 East Algonquin Road, Schaumburg, Illinois 60196.
Motorola also operates manufacturing facilities and sales offices in other U.S. locations and in many other
countries. (See ""Item 1: Business'' for information regarding the location of the principal manufacturing facilities
for each of Motorola's business segments.) Motorola owns 41 facilities (manufacturing, sales, service and office),
21 of which are located in North America and 20 of which are located in other countries. Motorola leases 295
facilities, 90 of which are located in North America and 205 of which are located in other countries.
As compared to 2005, the number of facilities owned or leased, excluding new acquisitions, was reduced
primarily because of the optimization of space and workplace mobility programs being utilized instead of adding
sites and space. New business acquisitions closed to date have added 21 sites to the Motorola real estate portfolio
worldwide. In addition, as part of Motorola's overall strategy to reduce operating costs and improve the financial
performance of the corporation, a number of businesses and facilities have either been sold or are currently for
sale. During 2006, facilities in Rohnert Park, California and Ichon, Korea and land parcels in Elgin, Illinois and
Tempe, Arizona were sold. A facility in Deer Park, Illinois was sold as part of the sale of the automotive
electronics business. Sites at Glen Rock, New Jersey and Guangzhou, China and land parcels in Anderson, South
Carolina and Tempe, Arizona are currently up for sale.
Motorola generally considers the productive capacity of the plants operated by each of its business segments to
be adequate and sufficient for the requirements of each business group. The extent of utilization of such
manufacturing facilities varies from plant to plant and from time to time during the year.
A substantial portion of Motorola's products are manufactured in Asia, primarily China, either in our own
facilities or in the facilities of others who manufacture and assemble products for Motorola. If manufacturing in
the region was disrupted, Motorola's overall productive capacity could be significantly reduced.