Texas Instruments 2008 Annual Report Download - page 25

TEXAS INSTRUMENTS 2008 ANNUAL REPORT [ 23 ]
The following table shows the components of acquisition-related intangible assets that are subject to amortization:
December 31, 2008 December 31, 2007
Amortization
Period
Gross
Carrying
Amount
Accumulated
Amortization Net
Gross
Carrying
Amount
Accumulated
Amortization Net
Acquisition-related intangibles:
Developed technology ................ 3–10 years $ 124 $ 60 $ 64 $ 141 $ 60 $ 81
Other intangibles ................... 2–7 years 47 20 27 58 24 34
Total ............................. $ 171 $ 80 $ 91 $ 199 $ 84 $ 115
Amortization of acquisition-related intangibles was $37 million, $48 million and $59 million for 2008, 2007 and 2006, primarily related
to developed technology. Fully amortized intangible assets are written off against accumulated amortization.
The following table sets forth the estimated amortization of acquisition-related intangibles for the years ended December 31:
2009 .............................................................................................. $33
2010 .............................................................................................. 32
2011 .............................................................................................. 16
2012 .............................................................................................. 7
2013 .............................................................................................. 3
12. Postretirement benefit plans
On December 31, 2006, we adopted the recognition and disclosure provisions of SFAS No. 158, Employers’ Accounting for Defined
Benefit Pension and Other Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and 132(R). SFAS 158 requires
us to recognize the funded status (i.e., the difference between the fair value of plan assets and the projected benefit obligations)
of our defined benefit pension and other postretirement benefit plans on our balance sheet. Previously unrecognized net actuarial
losses and prior service costs are reflected in AOCI, net of tax, and continue to be recognized in future periods as a component of net
periodic benefit cost. Actuarial gains and losses and prior service costs that arise in periods subsequent to December 31, 2006, are
not recognized as part of net periodic benefit cost in the period incurred but are recognized as a component of other comprehensive
income. These amounts are subsequently recognized as a component of future net periodic benefit cost consistent with our past
practice. We measure plan assets at fair value in accordance with SFAS 157, Fair Value Measurements.
Plan descriptions: We have various employee retirement plans including defined benefit, defined contribution and retiree health care
benefit plans. For qualifying employees, we offer deferred compensation arrangements.
U.S. retirement plans:
Principal retirement plans in the U.S are qualified and non-qualified defined benefit pension plans (all of which closed to new
participants after November 1997), a defined contribution plan and an enhanced defined contribution plan.
Both defined contribution plans offer an employer-matching savings option that allows employees to make pre-tax contributions
to various investment choices, including a TI common stock fund. Employees who remain in the qualified defined benefit pension plan
may also participate in the defined contribution plan, where employer-matching contributions are provided for up to 2 percent of the
employee’s annual eligible earnings. Employees who elected not to remain in the defined benefit pension plan, and employees hired
after November 1997 and through December 31, 2003, may participate in the enhanced defined contribution plan. This plan provides
for a fixed employer contribution of 2 percent of the employee’s annual eligible earnings, plus an employer-matching contribution of up
to 4 percent of the employee’s annual eligible earnings. Employees hired after December 31, 2003, do not receive the fixed employer
contribution of 2 percent of the employee’s annual eligible earnings.
At December 31, 2008 and 2007, as a result of employees’ elections, TI’s U.S. defined contribution plans held shares of TI common
stock totaling 32 million shares and 33 million shares valued at $494 million and $1.11 billion. Dividends paid on these shares for 2008
and 2007 totaled $14 million and $11 million.
Our aggregate expense for employees under the U.S. defined contribution plans was $56 million in each of 2008, 2007 and 2006.
Benefits under the qualified defined benefit pension plan are determined using a formula based upon years of service and
the highest five consecutive years of compensation. We intend to contribute amounts to this plan to meet the minimum funding
requirements of federal laws and regulations plus such additional amounts as we deem appropriate. The non-qualified plans are
unfunded and closed to new participants.