Texas Instruments 2014 Annual Report Download - page 102

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PROXY STATEMENT
Employees accruing benefits in the qualified pension plan, including the named executive officers other than Mr. Templeton, Mr. Crutcher
and Mr. Anderson, also are eligible to participate in a qualified defined contribution plan that provides employer matching contributions.
The enhanced defined contribution plan, in which Mr. Templeton, Mr. Crutcher and Mr. Anderson participate, provides for a fixed
employer contribution plus an employer matching contribution.
In general, if an employee who participates in the pension plan (including an employee whose benefits are frozen as described above)
dies after having met the requirements for normal or early retirement, his or her beneficiary will receive a benefit equal to the lump-sum
amount that the participant would have received if he or she had retired before death. Having already reached the age of 55 and at least
20 years of employment, Mr. Templeton, Mr. March and Mr. Ritchie are eligible for early retirement under the pension plans.
Because benefits under the qualified and non-qualified defined benefit pension plans are calculated on the basis of eligible earnings
(salary and bonus), an increase in salary or bonus may result in an increase in benefits under the plans. Salary or bonus increases for
Mr. Templeton and Mr. Crutcher do not result in greater benefits for them under the company’s defined benefit pension plans because
their benefits under those plans were frozen in 1997. Mr. Anderson does not participate in the company’s defined benefit pension plans.
The committee considers the potential effect on the executives’ retirement benefits when it sets salary and performance bonus levels.
Deferred compensation
Any U.S. employee whose base salary and management responsibility exceed a certain level may defer the receipt of a portion of
his or her salary, bonus and profit sharing. Rules of the U.S. Department of Labor require that this plan be limited to a select group of
management or highly compensated employees. The plan allows employees to defer the receipt of their compensation in a tax-efficient
manner. Eligible employees include, but are not limited to, the executive officers. We have the plan to be competitive with the benefits
packages offered by other companies.
The executive officers’ deferred compensation account balances are unsecured and all amounts remain part of the company’s
operating assets. The value of the deferred amounts tracks the performance of investment alternatives selected by the participant.
These alternatives are a subset of those offered to participants in the defined contribution plans described above. The company does
not guarantee any minimum return on the amounts deferred. In accordance with SEC rules, no earnings on deferred compensation are
shown in the summary compensation table on page 98 for 2014 because no “above market” rates were earned on deferred amounts in
that year.
Employee stock purchase plan
We have an employee stock purchase plan. Under the plan, which our shareholders approved, all employees in the U.S. and certain
other countries may purchase a limited number of shares of the company’s common stock at a 15 percent discount. The plan is
designed to offer the broad-based employee population an opportunity to acquire an equity interest in the company and thereby align
their interests with those of shareholders. Consistent with our general approach to benefit programs, executive officers are also eligible
to participate.
Health-related benefits
Executive officers are eligible under the same plans as all other U.S. employees for medical, dental, vision, disability and life insurance.
These benefits are intended to be competitive with benefits offered in the semiconductor industry.
Other benefits
Executive officers receive only a few benefits that are not available to all other U.S. employees. The CEO is eligible for a company-paid
physical and financial counseling. In addition, the board of directors has determined that for security reasons, it is in the company’s
interest to require the CEO to use company aircraft for personal air travel. Please see pages 99 (footnote 6) and 108 for further details.
The company provides no tax gross-ups for perquisites to any of the executive officers.
Compensation following employment termination or change in control
None of the executive officers has an employment contract. Executive officers are eligible for benefits on the same terms as other U.S.
employees upon termination of employment or a change in control of the company. The current programs are described under the
heading Potential payments upon termination or change in control, beginning on page 107. None of the few additional benefits that
the executive officers receive continue after termination of employment, except the amount for financial counseling is provided in the
following year in the event of retirement. The committee reviews the potential impact of these programs before finalizing the annual
compensation for the named executive officers. The committee did not raise or lower compensation for 2014 based on this review.