Texas Instruments 2007 Annual Report Download - page 26

24 TEXAS INSTRUMENTS 2007 ANNUAL REPORT
Under the 2000 Long-Term Incentive Plan, we may grant stock options, including incentive stock options, restricted stock and RSUs,
performance units and other stock-based awards. The plan provides for the issuance of 120,000,000 shares of TI common stock. In
addition, if any stock-based award under the 1996 Long-Term Incentive Plan terminates, then any unissued shares subject to the
terminated award become available to be granted under the 2000 Long-Term Incentive Plan. No more than 13,400,000 shares of
common stock may be awarded as restricted stock, RSUs or other stock-based awards (other than stock options) under the plan.
Under the 2003 Long-Term Incentive Plan, we may grant stock options (other than incentive stock options), restricted stock and RSUs,
performance units and other stock-based awards to non-management employees. The plan provides for the issuance of 240,000,000
shares of TI common stock. Executive officers and approximately 225 managers are ineligible to receive awards under this plan.
Under our 2003 Director Compensation Plan, we may grant stock options, RSUs and other stock-based awards to non-employee
directors, as well as issue TI common stock upon the distribution of stock units credited to deferred-compensation accounts established
for such directors. The plan provides for the grant of a stock option to each non-employee director once per year in the period from
January 2004 through 2010. For the years 2001 through 2006, each grant is an option to purchase 15,000 shares with an option
price equal to fair market value on the date of grant. Under the plan, we also make a one-time grant of 2,000 RSUs to each new
non-employee director of TI. The plan provides for the issuance of 2,000,000 shares of TI common stock. Effective in 2007, the plan
reduced the annual stock option grant to 7,000 shares and included an annual grant of 2,500 RSUs to each non-employee director.
Stock option and RSU transactions under the above-mentioned long-term incentive and director compensation plans during 2007 were
as follows:
STOCK OPTIONS RESTRICTED STOCK UNITS
Shares
Weighted
Average Exercise
Price per Share Shares
Weighted
Average Grant-Date Fair
Value per Share
Outstanding grants, December 31, 2006 ............. 218,771,948 $ 28.81 4,740,368 $ 26.37
Granted ....................................... 9,909,839 28.57 4,127,738 29.46
Vested (RSUs) .................................. — — (707,880) 17.25
Forfeited ...................................... (4,587,482) 35.30 (448,819) 28.24
Exercised ...................................... (38,126,974) 18.36 — —
Outstanding grants, December 31, 2007 ............. 185,967,331 $ 30.78 7,711,407 $ 28.75
The fair values of RSUs are determined based on the price of TI common stock on the date of grant. Compensation expense associated
with RSUs, which was all in continuing operations, totaled $49 million, $29 million and $18 million in 2007, 2006 and 2005.
The weighted average grant-date fair value of stock options granted during the years 2007, 2006 and 2005 was $9.72, $11.82 and
$10.07 per share. The weighted average grant-date fair value of RSUs granted during the years 2007, 2006 and 2005 was $29.46,
$31.36 and $24.42 per share.