Good afternoon, and welcome, everybody. For those in the room, we appreciate your personal attendance, and for those on the phone, we thank you for listening in. I'm delighted to welcome you to this Annual Meeting of the Motorola Solutions Stockholders. I'm going to begin by introducing my fellow director nominees, and then Michelle Warner will preside over the formal business of the meeting. And then finally, I will rejoin you to walk through our results and take some questions. As I introduce the other director nominees, I ask that they stand as I call their name. Ken Dahlberg is the former chairman of the board and CEO of SAIC and currently serves on the board of Teledyne Technologies. Ken chairs our board's Compensation and Leadership Committee. General Mike Hayden is a principal at the Chertoff Group and was formerly the director of the Central Intelligence Agency.
We're also delighted to welcome Clay Jones, who is the former chairman of the board and CEO of Rockwell Collins, and currently serves on the boards of Deere & Company and Cardinal Health. Welcome, Clay. Judy Lewent is the former Executive Vice President and CFO of Merck, and currently serves on the boards of GlaxoSmithKline and Thermo Fisher Scientific, and Judy chairs our board's Audit Committee. Anne Pramaggiore is the President and CEO of Commonwealth Edison. Sam Scott is the former chairman, president, and CEO of Corn Products International, and currently serves on the board of Abbott Labs and the Bank of New York Mellon. Sam chairs our board's Governance and Nominating Committee. Brad Singer is a partner at ValueAct Capital and is the former Senior Vice President and CFO of Discovery Communications.
Before we move on, I want to thank and acknowledge the contributions of Dave Dorman, who served on our board for nine years, including three years as Chairman and the last four as our Lead Independent Director. Now, for the formal business of the meeting, I'd like to introduce our Corporate Vice President, Deputy General Counsel, and Secretary, Michelle Warner, who will serve as today's presiding stockholder meeting chair. Michelle?
Thank you, Greg. We will now attend to the formal business of the meeting, after which Greg will give the company report. Following Greg's remarks, the floor will be open for our general question-and-answer period. Representatives of KPMG, the company's external auditors, are also present and available to answer questions during the question-and-answer period. When you came in, you were handed a printed program, which sets forth today's agenda and includes the procedures we will follow on the back. If you do not have a program, raise your hand so we can provide you with one. I now call the 2015 Annual Stockholders Meeting to order. As a reminder, the proposals in the proxy statement are the only items of business that can be transacted at this meeting.
As we go through the agenda, any stockholder who wishes to comment on a specific proposal may do so only during the time provided for comments on that proposal. If you wish to comment on a proposal, please approach the microphone when I ask if any stockholder wishes to comment on the proposal before the meeting. When recognized, please give your name. As a matter of courtesy to other stockholders, please limit your comments to two minutes to provide everyone with a fair opportunity to participate in the meeting. There's a total time limit of 10 minutes for the presentation and comments regarding each proposal under consideration. It is my job to enforce these procedures, so I thank you in advance for your cooperation.
This meeting is being held pursuant to a notice mailed on or about March 31st, 2015, to each stockholder of record as of the close of business on March 20th, 2015. A list of the stockholders entitled to vote at this meeting has been available for the past 10 days at our corporate offices and is available at this meeting for inspection. I am pleased to report that 185,948,173 shares of the 211,273,136 shares outstanding and entitled to vote are represented in person or by proxy at this meeting. This is 88% of the outstanding shares and represents a quorum for purposes of this meeting.
We are a Delaware corporation, and under Delaware law, I am required to announce the time of the opening and closing of the polls. So at 5:07 P.M. on May 18th, 2015, I now declare the polls open for all matters of business. The polls will remain open until all items of business have been presented and discussed. If there are any stockholders present who have already voted and wish to revoke or change their votes, or who have not yet voted and wish to vote, you may do so at this time. If you need a ballot, please raise your hand. You may vote until all items of business set forth on the agenda have been introduced and discussed. At that time, I will announce the polls are closed, and we will collect your ballots.
The first matter to be acted upon is the election of directors for a one-year term. I hereby nominate as directors for the ensuing year, or until their successors are duly elected and qualified, the board's eight nominees that were listed in the company's proxy statement. They are Greg Brown, Ken Dahlberg, Mike Hayden, Clay Jones, Judy Lewent, Anne Pramaggiore, Sam Scott, and Brad Singer. Is there a second?
I second the motion.
Does any stockholder wish to make a comment directly related to the election of directors? There being no comments on this topic, we will now move on to the next matter. The next matter to be acted upon is the non-binding advisory vote to approve the company's executive compensation. The resolutions provided in the proxy statement to be acted upon states, "Resolved that the stockholders approve, on an advisory basis, the compensation of the named executive officers as described in the compensation discussion and analysis. T he 2014 summary compensation table and other related tables and disclosures in this proxy statement." Is there a second?
I second the motion.
Does any stockholder wish to make a comment directly related to the stockholder advisory vote on executive compensation? There being no comments on this topic, we will now move on to the next matter. The next matter to be acted upon is the approval of the amendment and restatement of our Omnibus Incentive Plan. This proposal is now formally submitted for stockholder approval. Is there a second?
I second the motion.
Does any stockholder wish to make a comment directly related to the approval of the amendment and restatement of our Omnibus Incentive Plan? There being no comments on this topic, we will now move on to the next matter. The next matter to be acted upon is the approval of the amendment and restatement of our Employee Stock Purchase Plan. This proposal is now formally submitted for stockholder approval. Is there a second?
I second the motion.
Does any stockholder wish to make a comment directly related to the approval of the amendment and restatement of our Employee Stock Purchase Plan? There being no comments on this topic, we will now move on to the next matter. The next matter to be acted upon is the ratification of the appointment of KPMG LLP as the company's independent registered public accounting firm for 2015. The Audit Committee of the board has appointed KPMG as the company's independent registered public accounting firm for 2015. This appointment is now formally submitted for stockholder ratification. Is there a second?
I second the motion.
Does any stockholder wish to make a comment directly related to this proposal? There being no comments on this topic, we will now move on to the next matter. There's one remaining item of business to address, and the polls will close shortly. This year's Proxy Statement contains a stockholder proposal, which is titled Lobbying Disclosure. I will now recognize the sponsor of this resolution, who may introduce this proposal, make a brief supporting statement, and make a motion for adoption of this proposal. The proponent should limit her remarks to five minutes. In addition, please remember that a total of 10 minutes will be allowed for all speakers on this topic.
Michelle, mic working? Good afternoon. My name is Lindsay Mendoza, and I am representing Mercy Investment Services, Inc. The filer of the political spending resolution found on pages 69 and 70 of your proxy statement. I am here to move Proposal Six, Lobbying Disclosure. According to the Center for Political Accountability, also known as the CPA, political spending by 501(c)(4) groups rose from $5.2 million in 2006 to $300 million in 2012. These are kinds of organizations referred to in our resolution. Despite the Supreme Court's decision in Citizens United, allowing corporations greater freedom to spend shareholder money to influence politics, there are still no rules or procedures established to ensure that shareholders are informed of or have the right to approve decisions on spending of their money on politics.
Motorola Solutions shareholders currently have no way of knowing how much of our company's trade association payments are being used for political purposes or what those political purposes are. Furthermore, there is no indication in the policy statement contained in the Code of Business Conduct that those questions are raised with trade associations. For example, the U.S. Chamber of Commerce uses the money to speak out against healthcare for all legal residents of the United States. Complex issue and something that shareholders need to agree upon. According to the CPA, almost half of all S&P 500 companies have adopted some kind of guidelines for political giving, but the degree of disclosure varies greatly. Of several dozen companies that the CPA Zicklin Index ranks in the top tier of disclosure, most give a full accounting of their political activity.
We urge Motorola Solutions to coincide with this best practice. We believe Motorola Solutions' Board of Directors should recognize that good corporate governance today includes a political spending policy that is transparent, offers full disclosure, has board oversight, and is available to investors in its entirety on its corporate governance website section. Thanks again for having me again today.
Thank you. For the reasons stated in the company's Proxy Statement, including the fact that the company complies with all lobbying disclosure laws, our Legal and Government Affairs organization has in place policies and procedures for conducting lobbying activities. Our trade association memberships, over 50,000, are published on our website, and we believe that lobbying disclosure should apply equally to all participants in the legislative process. The board of directors recommends that you vote against the adoption of this stockholder-submitted proposal. Is there a stockholder who wishes to second this proposal to put it to a vote of the stockholders? Does any stockholder wish to make any further comments directly related to this proposal? There being no further comments on this topic, we will move on.
There are no other matters that may properly be voted on before this meeting, and I ask that you now complete your ballots and raise your hands so that we can collect them. If your broker or registered holder of your shares provided you with a legal proxy evidencing your right to vote, please be sure to turn that in with your ballot. I now declare the polls closed at 5:15 P.M. on May 18th, 2015. I will now read the preliminary results of the items acted upon at today's meeting, each as reported by the Inspector of Election. More than a majority of the shares voted in person or by proxy at this meeting were voted for the election of each director.
As a result, the 8 persons who have been nominated for election have been duly elected as the directors of the company, each to hold office for a one-year term. Approximately 97% of the votes cast were voted for the approval of the company's executive compensation. Approximately 96% of the votes cast were voted for the approval of the amendment and restatement of our Omnibus Incentive Plan. Approximately 98% of the votes cast were voted for the approval of the amendment and restatement of our employee stock purchase plan. Approximately 99% of the votes cast were voted for the ratification of the appointment of KPMG as the company's independent registered accounting firm for 2015. Approximately 24% of the votes cast were voted for the resolution on lobbying disclosure. As a result, this stockholder proposal has not been approved by the stockholders.
We will report the official results of the stockholder vote with respect to each proposal on a Form 8-K within four days of this meeting. I now declare the formal portion of the meeting adjourned. It is my pleasure to turn the meeting over to Greg Brown, who will report to you on the company's business and open the floor for a general question-and-answer period.
Good afternoon. Just to give you a couple of minutes quick snapshot of your company, we are now 87 years old. We sell in 100 countries. We have physical employee presence in 60 countries. We have the strongest intellectual property portfolio in mission-critical communications, and we're the worldwide market leader in public safety systems, mission-critical systems for commercial markets, as well as public safety LTE. We started reporting the organization in two different segments, products and services. Both are very important to us. Products is about $3.8 billion last year in revenue. Services is $2.1 billion. Both are important to our growth, but you'll see us emphasize even more going forward on the services aspects of that segment. Last year, revenue declined just under 6%.
Having said that, we generally held market share, and that decline was primarily driven by an acceleration of purchases in North America through a regulatory phenomenon called narrowbanding. That was the primary driver. Even though we had a contracted revenue in 2014, in this past quarter, revenue was flat, so it was an improvement, and on a constant currency basis, it grew 3%. As we've become a more focused company, we've been aggressively taking operating expenses out. We removed $205 million of expenses last year, and as you may know, we're on track to remove another $150 million-$175 million, while simultaneously redirecting research and development dollars more toward some of the growth initiatives around services, Smart Public Safety, and Public Safety LTE.
We sold our enterprise business last year for $3.45 billion, all cash. We've returned the majority of those proceeds back to shareholders. We've taken steps to de-risk the pension. Motorola used to be a very large company. We're much smaller, but we carry the remaining liability of the pension. So I think Gino and Rob O'Keefe and the finance department did responsible steps to de-risk that with not affecting pension benefits at all. And lastly, we returned $2.9 billion in either share repurchases or dividends in 2014. Since we separated the company, we've returned about $8.7 billion of capital. We've contracted the share base 36%, and we've had a total shareholder return of just over 92%, outpacing the S&P.
Now, that said, the most important thing for this company is to return to sustainable growth, and I have every confidence we'll be able to do that. It's also a positive sign that last year, we exited the year with a record level of backlog, and backlog, again, as you may know, is that what's sold, but that not converted yet to revenue. So that, I think, is a positive indicator of the business. We still believe that this business is a low-to-mid single-digit growth business. We have a great intellectual property portfolio.
I think the best product portfolio we've ever had in devices and infrastructure, in software and in services, and this is how we think about the business, the product growth, the services growth, and then the more rapid growth around double-digit growth of Smart Public Safety, things around software and things in the Command Center, as well as next-generation Public Safety LTE or broadband, which we again view as additive to the Land Mobile Radio business. In summary, I would say, I'm very proud of where we are in terms of giving back to the community. We are steadfast in our commitment to give back to the communities that we serve.
Last year, we gave about $13 million across public safety, public safety grants, STEM, science and engineering, and disaster recovery in 36 countries, impacting 1.1 million, either students or teachers or community members or first responders. You'll always see Motorola Solutions be proud and give back in the communities where we are. Then lastly, I'm proud to say that we were among the Fortune's Most Admired Companies. We were third, second year in a row. We moved up a notch, and we're number three in the category that we compete, with only Qualcomm and Cisco ahead of us. I think there's a lot of consistent demand for our products and services. We continue to attract and retain some of the best people in the industry.
Our competitive position is getting stronger, and we remain committed to reinvesting in growth and innovation. With that, I'll close and open it up if you had any questions or anything on your mind. Okay, hearing none, thank you for coming to our shareholder meeting. Thank you for being owners of our business. I'm proud of our company, I'm proud of our team, proud of the board, and look forward to a successful 2015 and beyond. Thanks for coming.