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Filed by Motorola, Inc.
Pursuant to Rule 425 Under the
Securities Act of 1933
Subject Company: Motorola, Inc.
Commission File No. 001-07221
On February 22, 2000, Motorola, Inc., a Delaware corporation, announced its
proposed acquisition of C-Port Corporation, a Delaware corporation. The
following is a transcript of an industry analyst conference call held by
Motorola and C-Port representatives on February 22, 2000:
MS&L Global
Merrimack Conference Call
February 22, 2000
OPERATOR: Ladies and gentlemen, thank you for standing by, and welcome to the
Merrimack conference call. At this time all participants are in a listen only
mode. Later we will conduct a question and answer session. Instructions will
be given at that time. If you should require any assistance during this call
please press * 0. As a reminder this conference is being recorded.
Your guest speaker for today is Corporate Vice President & Director of Investor
Relations, Mr. Ed Gamm, and your host, Mr. Phill Grove. Please go ahead sir.
PHILL GROVE: Good morning everybody, and thanks for joining us this morning. I
am Phill Grove, the Director of Communications & Marketing for Global
Semiconductors Networking & Computing Systems Group. And with me today are Fred
Tucker, the President of Motorola's Semiconductor Product Sector and Executive
Vice President and Deputy to the Chief Executive Office of Motorola, Inc. Also
Daniel Artusi, the Corporate Vice President & General Manager for our Networking
& Computing Systems Group. And Larry Walker, the Chief Executive Officer of the
C-Port Corporation.
I am sure that most of you have seen the news release that we issued earlier
this morning about the planned acquisition of C-Port by Motorola. We will
discuss this announcement for about fifteen minutes and then turn it over to you
for questions. With that, now let me introduce Fred Tucker.
FRED TUCKER: Thanks Phill. As the world's number one producer of inventive
processors Motorola offers multiple DigitalDNA(TM) solutions which enable our
customers to create new business opportunities in a variety of markets. Nowhere
is this more true than in the communications markets. As our industry shifts
focus from the PC to the network, new challenges emerge. We need to be able to
give the network intelligence. Give it the ability to be upgraded through
software rather than through constant rewiring and equipment upgrades. Giving
products intelligence is what DigitalDNA(TM) technology is all about. Something
that we have much experience in.
That is why the acquisition of C-Port is an exciting event for Motorola. We
pioneered the communications processor business more than a decade ago, and have
been a leader since. With this acquisition we complement our portfolio with
solutions for high bandwidth datapath switching, just as the Internet can drive
the bandwidth demand at unprecedented levels.
Together, Motorola and C-Port deliver what we call the "heart of smart" in the
form of DigitalDNA(TM) technology, to the networking market. Combining
Motorola's hosts and integrated communications processors which with C-Port's
network processor means that we now offer a solution for all of the intelligent,
programmable functions inside network equipment manufacturers' products. We are
enabling smarter networks faster.
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As we've demonstrated, sometimes it makes more sense to acquire unique
capabilities for specific markets than to develop them in-house. This is
particularly true in the Internet era where time-to-market has become such a
critical competitive issue. We are building a new, much stronger Motorola. And
a tremendous part of our strength today is in the light speed environment of the
technology industry, and being able to deliver a full range of solutions to our
customers. Given the explosion of demand for broadband communications capacity,
today we are in a terrific position to ride this wave by seeking to provide
everything that our customers require to allow new services over the Internet.
And that is great for our customers, and it is also great for Motorola.
Furthermore, we see an explosion of demand for our semiconductor products tied
into this increase in Internet usage. A lot of this growth is being fueled by
the convergence of the Internet and the wireless communications devices where we
are a leader. We believe that we are at the very earliest stage of a
communications revolution that will eventually impact billions of consumers as
the entire planet gets connected. Wireless devices that deliver Internet access
only recently hit the market, but the potential size of this market is mind
boggling. We are in the best position to benefit from this revolution by
providing the semiconductors and other network elements from cable and ADSL
modems to wireless handsets. That is why the new Motorola is so exciting to us.
Now Daniel and Larry can go into more detail regarding how C-Port's products
help enable this conversion. But suffice it to say that this is one reason why
we are so delighted to welcome C-Port to the Motorola family. Now I would like
to turn over the floor to Daniel.
DANIEL ARTUSI: Thanks Fred. This is a great day for Motorola Semiconductor
Product Sector as its network and computing systems grow. Up until now, the
process has controlled the administrative functions of the network plus the data
in software and active points in the network. The infrastructure of the network,
our communications processors run the equipment, but don't handle every packet
transported by the network. To date these are handled by proprietary ASICs,
Application Specific Integrated Circuits. ASICs can handle high-speed data, but
unfortunately this takes a long time to design and cannot be reprogrammed once
fabricated.
Thus, if a service provider wants to upgrade their equipment to provide a new
service or an added feature they have to buy new equipment for the networks.
This is expensive and time consuming. Fortunately, with the announcement that
we are making today about the acquisition of C-Port, this will soon no longer be
necessary. As you know, we have been a leader in helping customers build
networking equipment for more than a decade. Specifically, we are a leading
provider in communication processors. In fact, we have more than 600 customers
around the world, and 4000 design-wins for these processors today.
However, as noted by Fred, our customers demand an ever increasing intelligence
in the network for a variety of reasons. Fundamentally, there is a need to
deliver new service via the Internet and the network including wireless. These
services range from advanced billing, to video, to Internet telephones. That is
the major reason that we have decided to acquire C-Port Corporation. What C-
Port adds to the equation is bringing the ultimate intelligence to the network
by making it fully programmable. They have developed one of the most advanced
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network processors on the market. The keyboard is programmable. This is a
programmable network processor, and a special class communication processor
which will allow the manufacturers of the optical networking and Internet
searching equipment to provide the new services at a dramatically reduced time-
to-market. I will let Larry explain how this works in a few minutes.
It is important to note that this is a brand new market, but it is one that is
expected to expand dramatically over the next few years. In fact, the recent
Dataquest report predicted it should reach $1 billion within the next three
years. The evolution of the market suggests that this programmable network
processor will replace the ASICs used in today's networking equipment.
And so how does C-Port fit into the Motorola family? C-Port will work closely
with our Networking and Computing Systems Group. However, it will remain at its
Massachusetts headquarters and will keep its talent and management in place. We
want to preserve what has been built. We will take the talent, the systems, and
Motorola's expanded resources to help us speed up the time-to-market. It will,
therefore, compete in the market under the C-Port brand.
Also, C-Port will focus its marketing effort only on U.S. customers. We believe
there is a significant market for these processors in Europe and in Asia, and we
will utilize our sales infrastructure to market their technology on a global
scale.
What does this technology mean to Motorola? It means that we can now offer our
customer a scaleable family of solutions for the administration, vertical
processing, and datapath switching of data for the SOHO to the edge to the core
of the network. Basically, everything that makes networks smart.
Also C-Port's technology is fairly complementary to Motorola's networking
communications processor product line. In fact, C-Port supplies the class of
communication processors that we have never supplied ourselves. This will
enable us to meet our customer needs and offer them one-stop shopping, one-stop
smart.
Finally, by putting Motorola's world class resources and infrastructure behind
C-Port advanced architecture, we will be able to bring this outstanding
technology to more customers around the world and enable a faster time-to-market
than was previously possible. It will enable a smart network, faster.
At this point, I would like to introduce Larry Walker, CEO, President and
founder of C-Port Corporation.
LARRY WALKER: Thank you Daniel. This is also a great, great day for C-Port,
for our customers, and for our employees. C-Port has been on a path to radically
improve the way that network OEM's build the devices that provide the basis for
the next generation network infrastructure. We've made significant progress over
the last few years in achieving that goal, and we are thrilled by this new
opportunity to accelerate that progress through the acquisition announced today
by Motorola, a clear leader in the communications processor space.
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The pace at which C-Port's revolutionary approach which we call the C-Ware
platform has gained acceptance in the industry. It is clearly an idea whose
time has come given entirely to the intense demand in our customer space to
deliver advanced features and services to meet our customers' needs.
Well, let me take a quick step back and explain in more detail what we do at C-
Port. As you all know, the communications industry is all about time-to-market.
In the early days of networking high-end networking devices were based on
networking software riding on conventional communications processors, often
those from Motorola. This software approach made it easy for the vendors to
respond to new protocols and to add new features for solutions still used today
in SOHO and in some access applications.
Over time, however, bandwidth requirements increased exponentially leaving the
network vendors to put more and more functionality in application specific
hardware to deliver top performance. The problem with this hardware approach is
that it took on average two years to develop high-end products. That is clearly
too long and too expensive for such a dynamic marketplace. Added to the problem
is the fact that after pouring in all of this investment, products would have a
very short useful lifetime once deployed.
Enter C-Port. We offer network equipment vendors the industry's first fully
programmable, high performance network processor. The C-5 DCP(TM), designed
specifically to run networking software for high-end network solutions. We
combined the C-5 DCP (TM) with a robust development environment, and a rich
programming interface created using open standards. Fully programmable means
the hardware, the chip itself, is independent of a physical layer of the network
infrastructure and can therefore be programmed to support a broad range of
applications the customer requires.
In fact, each C-5 DCP(TM) can support multiple protocols and applications
concurrently which is a key requirement at the edges of the network, such as at
the optical wave where requirements are constantly changing. We extend the fully
programmable concept to mean easily programmable by enabling developers to
program the C-5 DCP(TM) into ubiquitous language in the communications industry,
the C language. This is consistent with C-Port's vision to use industry standard
tools, language, and interfaces, to enable our customers to rapidly design and
deploy leading edge high-end solutions.
Together, C-Port and Motorola will work to solve more customers' problems and
deliver smart, high performance platforms ahead of our competition. C-Port's
goal two years ago was to win by helping our customers win, and together with
Motorola will continue to do exactly that.
PHILL GROVE: Well, thank you everybody for participating in this announcement.
Through the conference call facilitator we will be taking your questions in a
moment. I would like to turn it back over to them now. However, if you would
like we also have additional information posted on the Internet at
www.motorola.com/semiconductors/smartnetwork. That web site goes live at 10:30
Central Time, 11:30 Eastern Standard Time. And you can find a press release on
Business Wire.
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Thank you, and I will turn it over to the facilitator to take questions.
OPERATOR: And ladies and gentlemen, if you wish to ask a question please press
the 1 on your touch tone phone. You will hear a tone indicating that you have
been placed in queue. You may remove yourself from queue at any time by
pressing the # key. If you are using a speakerphone please pick up your handset
before pressing the numbers. One moment please for the first question. And
again, ladies and gentlemen, if you do have a question please press the 1 at
this time. And we have no questions at this time, sir. Please continue.
PHILL GROVE: Well, if there are no questions, then again, you can go to our web
site for more information. Also, we are conducting individual interviews and
those can be arranged by calling MS & L Global Technologies, Anne Marie Furie,
and the phone number is 805/494-0830.
Thank you again for joining us today, and we look forward to talking to you in
the future. Thank you.
OPERATOR: And ladies and gentlemen, this conference will be available for
replay after 11:30 a.m. Mountain Time today through Tuesday, March 14th at 12:00
midnight. You may access the AT&T Executive Teleconference Playback Service at
any time by dialing 1/800-475-6701, and entering the access code 503109.
International participants may dial 320/365-3844. Those numbers again are
1/800-475-6701 and 320/365-3844. The access code is 503109.
And that does conclude our conference for today. Thank you for your
participation and for using AT&T Executive Teleconference Service. You may now
disconnect.
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Documents relevant to the acquisition:
Motorola will be filing a registration statement containing a proxy
statement/prospectus and other relevant documents concerning Motorola's
acquisition of C-Port with the United States Securities and Exchange Commission
(the "SEC"). WE URGE INVESTORS TO READ THE PROXY STATEMENT/PROSPECTUS AND ANY
OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SEC, WHEN THEY BECOME AVAILABLE,
BECAUSE THEY CONTAIN IMPORTANT INFORMATION. Investors will be able to obtain the
documents free of charge at the SEC's web site, www.sec.gov. In addition,
documents filed with the SEC by Motorola will be available free of charge by
contacting Motorola Investor Relations at 1303 East Algonquin Road, Schaumburg,
Illinois 60196, Telephone (800) 262-8509. READ THE PROXY STATEMENT/PROSPECTUS
CAREFULLY BEFORE MAKING A DECISION CONCERNING THE MERGER.
Business Risks:
Statements about Motorola's future financial performance, the likelihood that
the transaction will be consummated in a timely manner and the financial impact
of the transaction are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. It is uncertain whether any
of the events anticipated by the forward-looking statements will transpire or
occur, or, if any of them do so, what impact they will have on the results of
operations and financial condition of the Semiconductor Products Sector,
Motorola or the price of its stock. Motorola wishes to caution the reader that
the following factors and those in its 1999 Proxy Statement on pages F-15
through F-18, in its Form 10-Q for the period ending October 2, 1999, and in its
other SEC filings could cause the actual results of Motorola or the
Semiconductor Products Sector to differ materially from those in the forward-
looking statements: the ability of the companies to successfully integrate C-
Port's business and capitalize on the combined technologies; and factors
affecting the future evolution of the communications processor market and
related technology.
