Texas Instruments 2014 Annual Report Download - page 114

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PROXY STATEMENT
Qualified and non-qualified defined benefit pension plans
The purposes of these plans are described on pages 95-96. The formula for determining benefits, the forms of benefit and the timing of
payments are described on pages 105-106. The amounts disbursed under the qualified and non-qualified plans are paid, respectively,
by the TI Employees Pension Trust and the company.
Survivor benefit plan
The purpose of this plan is described on page 106. The formula for determining the amount of benefit, the form of benefit and the timing
of payments are described on page 106. Amounts distributed are paid by the TI Employees Health Benefit Trust.
Deferred compensation plan
The purpose of this plan is described on page 96. The amounts payable under this program depend solely on the performance of
investments that the participant has chosen for his plan balance. The timing of payments is discussed on page 107. Amounts distributed
are paid by the company.
Equity compensation
Depending on the circumstances of termination, grantees whose employment terminates may retain the right to exercise previously
granted stock options and receive shares under outstanding RSU awards. Please see pages 102-103. RSU awards include a right to
receive dividend equivalents. The dividend equivalents are paid annually by the company in a single cash payment after the last dividend
payment of the year.
Perquisites
Financial counseling is available to executive officers in the year after retirement. Otherwise, no perquisites continue after termination
of employment.
In the case of a resignation pursuant to a separation arrangement, an executive officer (like other employees above a certain job grade
level) will typically be offered a 12-month paid leave of absence before termination, in exchange for a non-compete and non-solicitation
commitment and a release of claims against the company. The leave period will be credited to years of service under the pension plans
described above. During the leave, the executive officer’s stock options will continue to become exercisable and his RSUs will continue
to vest. Amounts paid to an individual during a paid leave of absence are not counted when calculating benefits under the qualified and
non-qualified pension plans.
In the case of a separation arrangement in which the paid leave of absence expires when the executive officer will be at least 50 years
old and have at least 15 years of employment with the company, the separation arrangement will typically include an unpaid leave of
absence, to commence at the end of the paid leave and end when the executive officer has reached the earlier of age 55 with at least
20 years of employment or age 60 (bridge to retirement). The bridge to retirement will be credited to years of service under the qualified
and non-qualified pension plans described above. Stock options will continue to become exercisable and RSUs will remain in effect, but
for grants made before 2014, the number of RSUs will be reduced as described in note * on page 103.
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Our only program, plan or arrangement providing benefits triggered by a change in control is the TI Employees Non-Qualified Pension
Plan. A change in control at December 31, 2014, would have accelerated payment of the balance under that plan. Please see page 106
for a discussion of the purpose of change in control provisions of that plan as well as the circumstances and the timing of payment.
Upon a change in control there is no acceleration of vesting of stock options and RSUs granted after 2009. Only upon an involuntary
termination (not for cause) within 24 months after a change in control of TI will the vesting of such stock options and RSUs accelerate.
Please see pages 97 and 102-103 for further information concerning change in control provisions relating to stock options and RSUs.
For a discussion of the impact of these programs on the compensation decisions for 2014, please see page 96.