Motorola 2011 Annual Report Download - page 26

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needed, it could negatively impact us. We rely on the experience of our senior management, who have specific
knowledge relating to us and our industry that is difficult to replace and competition for management with
experience in the communications industry is intense. A loss of the CEO, a member of senior management or key
employee particularly to a competitor could also place us at a competitive disadvantage. Further, if we fail to
adequately plan for the succession of our CEO, senior management and other key employees, the Company could be
negatively impacted.
It may be difficult for us to recruit and retain the types of engineers and other highly-skilled employees that are
necessary to remain competitive.
Competition for key technical personnel in high-technology industries is intense. We believe that our future
success depends in large part on our continued ability to hire, assimilate, retain and leverage the skills of qualified
engineers and other highly-skilled personnel needed to develop successful new products. We may not be as
successful as our competitors at recruiting, assimilating, retaining and utilizing these highly-skilled personnel. In
2012, we are planning changes to our annual stock grants, which may increase the retention risk of affected
employees.
The unfavorable outcome of any pending or future litigation or administrative action could negatively impact the
Company.
Our financial results and reputation could be negatively impacted by unfavorable outcomes to any pending or
future litigation or administrative actions, including those related to the Foreign Corrupt Practices Act and other
anti-corruption laws. See “Item 3-Legal Proceedings.” There can be no assurances as to the favorable outcome of
any litigation or administrative proceedings. In addition, it can be very costly to defend litigation or administrative
proceedings and these costs could negatively impact our financial results.
It is important that we are able to obtain many different types of insurance, and if we are not able to obtain
insurance or we exhaust our coverage we are forced to retain the risk.
We have many types of insurance coverage and are also self-insured for some risks and obligations. While the
cost and availability of most insurance is stable, there are still certain types and levels of insurance that remain
difficult to obtain. As we grow our Global Services organization we are increasingly being asked to obtain
professional liability insurance. We do not currently carry professional liability insurance as such insurance is
expensive to obtain for the amount of coverage often requested by certain customers. Natural disasters and certain
risks arising from securities claims, professional liability and public liability are potential self-insured events that
could negatively impact our financial results. In addition, while we maintain insurance for certain risks, the amount
of our insurance coverage may not be adequate to cover all claims or liabilities, and we may be forced to bear
substantial costs from an accident, incident or claim.
We are subject to a wide range of product regulatory and safety, consumer, worker safety and environmental laws.
Our operations and the products we manufacture and/or sell are subject to a wide range of global laws.
Compliance with existing or future laws could subject us to future costs or liabilities, impact our production
capabilities, constrict our ability to sell, expand or acquire facilities, restrict what products and services we can
offer, and generally impact our financial performance. Some of these laws are environmental and relate to the use,
disposal, clean up of, and exposure to certain substances. For example, in the United States, laws often require
parties to fund remedial studies or actions regardless of fault and often times in response to action or omissions that
were legal at the time they occurred. We continue to incur disposal costs and have ongoing remediation obligations.
Changes to environmental laws or our discovery of additional obligations under these laws could have a negative
impact on our financial performance.
Laws focused on: the energy efficiency of electronic products and accessories; recycling of both electronic
products and packaging; reducing or eliminating certain hazardous substances in electronic products; and the
transportation of batteries continue to expand significantly. Laws pertaining to accessibility features of electronic
products, standardization of connectors and power supplies, the transportation of lithium-ion batteries and other
aspects are also proliferating.
There are also demanding and rapidly changing laws around the globe related to issues such as product safety,
radio interference, radio frequency radiation exposure, and consumer and social mandates pertaining to use of