Texas Instruments 2007 Annual Report Download - page 25

TEXAS INSTRUMENTS 2007 ANNUAL REPORT 23
Concentrations of credit risk with respect to accounts receivable are limited due to the large number of customers in our customer base
and their dispersion across different industries and geographic areas. We maintain an allowance for losses based upon the expected
collectibility of accounts receivable. These allowances are deducted from accounts receivable balances. Details of these allowances
are as follows:
Accounts Receivable Allowances Balance at Beginning of Year
Additions Charged
to Operating
Results Recoveries and Write-offs, Net Balance at End of Year
2007 .......................................... $ 26 $ — $ — $ 26
2006 .......................................... $ 34 $ 2 $ (10) $ 26
2005 .......................................... $ 36 $ 1 $ (3) $ 34
8. Stockholders’ Equity
We are authorized to issue 10,000,000 shares of preferred stock; however, no preferred stock is currently outstanding.
Each outstanding share of TI common stock carries one-fourth of a stock purchase right. Under certain circumstances, each right
may be exercised to purchase one one-thousandth of a share of TI participating cumulative preferred stock for $200. Under certain
circumstances following the acquisition of 20 percent or more of outstanding TI common stock by an acquiring person (as defined in the
rights agreement), each right (other than rights held by an acquiring person) may be exercised to purchase the common stock of TI or a
successor company with a market value of twice the $200 exercise price. The rights, which are redeemable by us at one cent per right,
expire in June 2008.
In 2005, the TI board of directors authorized the repurchase of $4.0 billion of TI common stock. Since that time, the board of directors
authorized additional repurchase amounts of $10.0 billion in 2006 and $5.0 billion in 2007. No expiration date has been specified for
these authorizations. As of December 31, 2007, $5.57 billion of these authorizations remain. Treasury shares acquired in connection
with the board-authorized stock repurchase program in 2007, 2006 and 2005 were 147,645,809 shares; 173,580,794 shares; and
154,143,706 shares.
In the third quarter of 2006, the board of directors increased our quarterly cash dividend (to $0.04 per share from $0.03 per share).
In the second quarter of 2007, the board of directors doubled our quarterly cash dividend (to $0.08 per share). In the third quarter of
2007, the board of directors increased our quarterly cash dividend to $0.10 per share, and on October 18, 2007, declared a dividend at
that quarterly rate.
9. Stock-based Compensation
Information in this note is inclusive of both continuing and discontinued operations, except as noted.
Long-term Incentive and Director Compensation Plans
We have stock options outstanding to participants under the Texas Instruments 2000 Long-Term Incentive Plan, the Texas Instruments
2003 Long-Term Incentive Plan and the 1996 Long-Term Incentive Plan, but no further options may be granted under the 1996 plan.
We also assumed stock options granted under the Burr-Brown 1993 Stock Incentive Plan and the Radia Communications, Inc. 2000
Stock Option/Stock Issuance Plan. Unless the options are acquisition-related replacement options, the option price per share may not
be less than 100 percent of the fair market value on the date of the grant. Substantially all the options have a 10-year term and vest
ratably over four years. Options generally provide for the continuation of vesting after the option recipient retires.
We have RSUs outstanding under the 2000 Long-Term Incentive Plan and the 2003 Long-Term Incentive Plan. Each RSU represents the
right to receive one share of TI common stock on the vesting date, which is generally four years after the date of grant. Upon vesting,
the shares are subject to issuance without payment by the grantee.