Motorola to Acquire Modulus Video

    SCHAUMBURG, Ill. and SUNNYVALE, Calif., May 17 /PRNewswire-FirstCall/
 -- Motorola, Inc. ( MOT) and Modulus Video, Inc., a privately-held
 company, announced the signing of a definitive merger agreement, under
 which Motorola will acquire Modulus Video. The terms of the transaction
 were not disclosed.
     Modulus Video is a leader and innovator in MPEG-4 Advanced Video Coding
 (AVC) compression systems designed for delivery of high value video content
 in the IPTV, cable, broadcast and satellite marketplace. Modulus Video has
 partnered with Motorola for over two years bringing high-quality encoding
 solutions to key customers around the world.
     This acquisition will complement Motorola's recent acquisitions of
 Broadbus, Kreatel, Tut Systems and Netopia in the creation and delivery of
 an integrated, end-to-end video delivery system for multiple network
 architectures.
     "Motorola is committed to offering an integrated, end-to-end video
 portfolio designed to meet the current and next-generation requirements of
 operators," said Dan Moloney, President, Home and Networks Mobility
 business, Motorola, Inc. "As consumers demand more high definition video
 and interactive services, the need for advanced compression technology is
 increasingly important. As part of its advanced real-time video encoding
 products, Modulus Video has a powerful architecture and product development
 framework that is well suited for continued technological advancement."
     "Through this acquisition, Modulus Video will become part of a
 world-class organization in a highly strategic market segment. Our team
 will benefit from Motorola's rich heritage and leadership of video delivery
 expertise," said Bob Wilson, Chairman and CEO of Modulus Video. "Modulus
 Video will bring to Motorola a software-centric platform that ensures
 flexibility, reduced cost and fast development time."
     Upon completion of the transaction, Modulus Video will become a wholly
 owned subsidiary of Motorola and will be integrated into the Motorola Home
 and Networks Mobility business. Motorola intends to maintain Modulus Video
 operations in Sunnyvale, California.
     The transaction is subject to customary closing conditions, including
 regulatory approvals and the approval of Modulus Video stockholders, and is
 expected to be completed in the second or third quarter of 2007.
     About Modulus Video
     Since its founding in 2002, Modulus Video has been the only company to
 focus 100 percent of its efforts on perfecting the use of the MPEG-4 AVC
 video compression standard. As a result, Modulus Video's powerful MPEG-4
 AVC encoders are now a critical component behind today's most compelling
 IPTV deployments around the world, providing the most efficient use of
 available bandwidth and delivering outstanding standard definition and high
 definition television services over new and existing broadband
 infrastructure. Its products meet the needs of the broadcast, narrowcast
 and video-on-demand markets. For more information, please visit
 http://www.modulusvideo.com.
     About Motorola
     Motorola is known around the world for innovation and leadership in
 wireless and broadband communications. Inspired by our vision of Seamless
 Mobility, the people of Motorola are committed to helping you get and stay
 connected simply and seamlessly to the people, information, and
 entertainment that you want and need. We do this by designing and
 delivering "must have" products, "must do" experiences and powerful
 networks -- along with a full complement of support services. A Fortune 100
 company with global presence and impact, Motorola had sales of US $42.9
 billion in 2006. For more information about our company, our people and our
 innovations, please visit http://www.Motorola.com.
     Forward-Looking Statements
     Certain statements contained in this press release, including the
 expected timetable for completing the proposed transaction between Motorola
 and Modulus Video, future financial and operating results, benefits and
 synergies of the transaction, future opportunities for the combined company
 and products, any other statements regarding Motorola's or Modulus Video's
 future expectations, beliefs, goals or prospects, the near-term impact of
 the transaction on Motorola's earnings per share, and any statements that
 are not statements of historical facts might be considered forward-looking
 statements. While these forward-looking statements represent managements'
 current judgment of future events, they are subject to risks and
 uncertainties that could cause actual results to differ materially from
 those stated in the forward-looking statements. Important factors that
 could cause actual results or events to differ materially from those
 indicated by such forward-looking statements, include: (i) the parties'
 ability to consummate the transaction; (ii) the conditions to the
 completion of the transaction may not be satisfied, or the regulatory
 approvals required for the transaction may not be obtained on the terms
 expected or on the anticipated schedule; (iii) the parties' ability to meet
 expectations regarding the timing, completion and accounting and tax
 treatments of the transaction; (iv) the possibility that the parties may be
 unable to achieve expected synergies and operating efficiencies within the
 expected time-frames or at all; (v) Motorola's ability to successfully
 integrate Modulus Video's operations and technology into those of Motorola
 and the possibility that such integration may be more difficult,
 time-consuming or costly than expected; (vi) revenues following the
 transaction may be lower than expected; (vii) operating costs, customer
 loss and business disruption (including, without limitation, difficulties
 in maintaining relationships with employees, customers, clients or
 suppliers) may be greater than expected following the transaction; (viii)
 the retention of certain key employees at Modulus Video; and (ix) the other
 factors described in Motorola's Annual Report on Form 10-K for the year
 ended December 31, 2006 and its subsequent reports filed with the SEC.
 Motorola and Modulus Video assume no obligation to update or revise any
 forward-looking statement in this press release, and such forward-looking
 statements speak only as of the date hereof.
     MOTOROLA and the Stylized M Logo are registered in the US Patent and
 Trademark Office. All other product or service names are the property of
 their respective owners. (C) Motorola, Inc. 2007
 
 

SOURCE Motorola, Inc.