Google’s announcement of its $12.5 billion Motorola buy blindsided the tech and Wall Street press this morning, suggest it either kept the deal very tightly under wraps–which the Goog is not known for being good at–or it happened very quickly. But Motorola started hinting at an acquisition as far back as March, according to SEC filings dug up by the fine print experts at Footnoted, in which the company started playing with its severance packages in the event of a “change in control,” suggesting serious talks with Google may be months old.
Just over two weeks ago, the handset-maker filed a severance plan attached to its quarterly report that alluded to “the possibility of a Change in Control,” effective February 15. The 10-K that Motorola filed on February 18 had a lot of other employment-related agreements appended, Footnoted notes, suggesting the company was considering the possibility of an acquisition much earlier than anyone suspected–and today’s news suggests a Google buy may have been the alluded-to “change in control.” Perhaps the 800 lb. gorilla can walk softly after all?
“The Company recognizes that the possibility of a Change in Control (as hereinafter defined) may exist from time to time,” the filing begins obliquely, “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.”
The specifics of how Motorola planned to compensate its management and provide for employees in the event of redundancies were not declared until two weeks ago, however, although there was a brief description filed of the plan in a March 15 proxy. Among other provisions, Chairman and CEO Sanjay Jha stands to make more than $90 million, although the benefits for new executives were reduced “from a 3-times severance multiple to a 2-times severance multiple” after three years.